GOLDILOCKS AND BUSINESS RECORDS TOO MANY, TOO FEW, OR JUST RIGHT?

Transcription

1 GOLDILOCKS AND BUSINESS RECORDS TOO MANY, TOO FEW, OR JUST RIGHT? BUSINESS AND LITIGATION PERSPECTIVES ACC Mid-America Chapter February 2014

2 Mark Sableman Thompson Coburn Partner Rebecca Perry Jordan Lawrence CIPP/US/G Director of Professional Services

3 MR. DATA GOES TO COURT Hypothetical a corporate IT manager, Mr. Data, and how he and his company handles electronic discovery Two scenarios: Less than Optimum and Better Here s the beginning we will tell the rest of the story in the second part of the seminar

4 BACKGROUND Less than Optimum corporate planning

5 LESS THAN OPTIMUM CORPORATE PLANNING VIDEO SEGMENT #1

6 BACKGROUND Better corporate planning

7 BETTER CORPORATE PLANNING VIDEO SEGMENT #2

8 GET THOSE OLD RECORDS OFF THE SHELF OVER-RETAINING RECORDS & INFORMATION IS RISKY BUSINESS Rebecca Perry

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10 ABC Company s Retention Schedule DOOM

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12 THE CORNERSTONE PROCESSES WHERE RETENTION WHAT Records DataMap SENSITIVITY

13 Engage the business They have the knowledge

14 RECORDS Accounts Payable Records Advertising Records Audit Records & Reports Brand Strategy Benefit Records Budget Records Contracts & Agreements Coupon Records Credit Card Reconciliations Customer Complaints Design Sketches Import Documentation Inventory Records Personnel Files Sales Records

15 BUSINESS AREAS Accounting Credit Card Operations Customer Service Distribution e-commerce Inventory Planning & Control Human Resources Legal Loss Prevention Merchandising Quality Risk Management Shipping Store Operations Quality

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17 BUSINESS NEEDS REGULATIONS SENSITIVITY Department of Labor EPA HIPAA OSHA Payroll State Privacy Laws Worker s Comp Corporate Sensitive Personal Financial Government IDs Intellectual Property PII Bio Metric Patient Health Info.

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21 ACTIONABLE RETENTION SCHEDULE

22 DEVELOP RETENTION RULES & STRATEGY for NON-ESSENTIAL COMMUNICATION INBOX = 180 DAYS SENT ITEMS = 180 DAYS DELETED ITEMS = 2 DAYS BUSINESS REFERENCE VALUE 18 MONTH RETENTION VALID BUSINESS RECORDS 6 YEAR RETENTION BENEFITS 7 YEAR RETENTION LEGAL 7 YEAR RETENTION TAX DISABILITY RECORDS 6 YEARS

23 LEVERAGE TECHNOLOGY RECORDS NON-RECORDS 6 Years 3 Years 18 Months

24 ELIMINATE OBSOLETE PAPER RECORDS 44% of Boxes Eligible for Immediate Destruction Remaining Boxes 56% Destroyed Boxes 44%

25 TRAINING ABC COMPANY S RECORDS MANAGEMENT TRAINING

26 BUILD YOUR AUDIT TRAIL Require regular policy attestation Records Retention Policy

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28 E-DISCOVERY: BEST PRACTICES IN THE POST-ZUBULAKE ERA Mark Sableman Thompson Coburn LLP

29 TODAY S FOCUS ON EDISCOVERY Proliferation of Electronically Stored Information (ESI) Centrality of ediscovery in most contemporary business litigation

30 DOING E-DISCOVERY RIGHT Take seriously the duty to find and preserve electronic evidence Develop smart document retention policies and good document creation disciplines from the outset Use technical experts Ask probing questions internally, to prepare for the tough questions in litigation

31 THE PRE-LITIGATION PERIOD Your timeline: no pressure from litigation Opportunity to proactively take control of: Records you create Records you save How you organize your records

32 THE E-DISCOVERY PROCESS Collection of Relevant Materials Production Litigation Hold Review, Sorting, Analysis Discovery probing adequacy of hold, collection and production

33 THE LITIGATION HOLD DUTY Recognized in pre-ediscovery law Heightened importance now More information involved Greater possibility of loss of large amount of relevant data Technical knowledge needed Zubulake and other decisions put burden on clients, lawyers and IT personnel Post-Zubulake decisions are sanctioning noncompliance

34 THE LITIGATION HOLD DUTY RECENT CASES Related Claims can give rise to companywide hold obligation. In re Pradaxa Prod. Liab. Lit, 2013 WL (S.D. Ill Dec. 9, 2013). The hold/search process of is fair game in discovery and not necessarily privileged. Ruiz- Bueno v. Scott, 2013 WL (S.D. Ohio Nov. 15, 2013). Parties have an affirmative obligation to meet and discuss search protocols. Banas v. Volcano Corp., 2013 WL (N.D. Cal. Oct. 4, 2013).

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36 A LITIGATION STORY How should companies and their law firms handle e-discovery?

37 MR. DATA: TWO SCENARIOS Mr. Data is IT manager for Saminilla, Inc., a peanut processor/supplier Class action alleged tainted peanut butter Adequacy of company s safety inspections are a key issue

38 CLASS V. SAMINILLA The Safety Inspection Issue Saminilla s inspector, Morse, gathered and analyzed data from a computer in the plant He retained data on a USB drive Did not or share data with corporate Provided corporate only with summary reports Plaintiffs want the raw data... And even more, want to allege company misconduct in destroying or failing to retain data

39 CAST OF CHARACTERS Class action counsel Mr. Data Saminilla's information officer Saminilla s outside counsel Saminilla s general counsel

40 PRE-LITIGATION STEPS: BEST PRACTICES Good document organization isn t legally required Less than Optimum scenario was OK legally But consider the benefits once litigation occurs Do you consider it a desirable best practice for your company?

41 PREPARING FOR DISCOVERY Scenario One: Less than Optimum call by outside counsel to Saminilla

42 SCENARIO ONE LESS THAN OPTIMUM VIDEO SEGMENT #3

43 PREPARING FOR DISCOVERY Scenario Two: Better meeting between outside counsel and Mr. Data, Saminilla s Chief Information Officer

44 PREPARING FOR DISCOVERY VIDEO SEGMENT #4

45 PREPARING FOR DISCOVERY: BEST PRACTICES Brief phone calls are rarely adequate The Better Scenario Meeting was with Mr. Data, who fully understood Saminilla s practices and records Counsel cross-examined his own witness, and talked through problem areas At times, we bring out own technical expert, to better probe technical issues geek to geek

46 DISCOVERY CONFERENCE WITH OPPOSING COUNSEL Scenarios One and Two

47 DISCOVERY CONFERENCE WITH OPPOSING COUNSEL VIDEO SEGMENT #5

48 DISCOVERY CONFERENCE WITH OPPOSING COUNSEL: BEST PRACTICES COMMENTS E-discovery is always top of mind Counsel requesting documents often has two objectives: Get all of the key evidence Set the other side up for a spoliation claim

49 DEPOSITION OF MR. DATA Scenario One: Less than Optimum

50 DEPOSITION LESS THAN OPTIMUM VIDEO SEGMENT #6

51 DEPOSITION OF MR. DATA Scenario Two: Better

52 DEPOSITION BETTER VIDEO CLIP #7

53 DEPOSITION OF MR. DATA: BEST PRACTICES COMMENTS The facts are the same in both scenarios Better is better because of preparation Everything was probed at the outset Mr. Data wasn t caught by surprise Mr. Data explained not only the facts, but the reasonableness of the company s actions Business procedures at the time Preservation and gathering of records and data for discovery

54 BEST PRACTICES REVIEW Loose, non-specific we trust you notice clearly inadequate today Better, involving careful inquiries about electronic records, with client s IT experts Best, using e-discovery experts to help attorneys question and work with clients

55 Mark Sableman Thompson Coburn Partner Rebecca Perry Jordan Lawrence CIPP/US/G Director of Professional Services