e-Book: Chapter 4 - ESI Datamap: Managing Litigation Risk
The Digital Age has brought with it new challenges in the courtroom. Changes to the Federal Rules of Civil Procedure that went into effect in December 2006 allow electronically stored information, known as ESI, to be requested during the discovery process in court. The new rules were meant to bring into line the practices managing ESI to improve consistency, but they have also had an impact on the bottom line.
It's easy to figure out why: The average corporation today is facing between 30 and 40 ongoing lawsuits. For larger companies, the number of lawsuits can exceed 500 per year. At the same time, the amount of electronic information is growing. Market analysis firm IDC estimates that more than 161 billion gigabytes of information is being produced by businesses annually. As a result, the requirements and costs associated with the production and review of electronically stored information have become staggering.
The consequences for businesses that do not meet the new requirements can also be substantial. Many recent cases have shown the high cost of sanctions for those companies that destroyed ESI or could not produce it. IT shops will play a central role in helping to manage litigation risk by understanding and preparing for requirements related to e-discovery. And the sooner companies develop a comprehensive litigation plan, the faster they will be on track for compliance with the new e-discovery rules. Preparing for e discovery is not an easy task. To put together a plan, both the legal department and the IT staff should assess their current capabilities for executing e-discovery requests and implementing litigation holds. They should also review the company's related record retention policies and procedures.