eDiscovery Nightmare:  Creeping Client Data

Your Worst NightmareOne of the most overlooked issues in eDiscovery happens AFTER the case is over — law firms and clients are so relieved the case is finished that they forget the necessary cleanup of what I call client data creep. After years of litigation, the client’s data is spread across a firm’s IT systems.  (Note:  We are talking about client’s actual produced data for discovery, NOT case file materials.) This is a widespread problem, and one that can have potentially expensive and serious implications.  On the plus side, there are simple solutions.  Put them on your radar.

Here’s the scenario:  Client has provided data to law firm for use in a case.  The lawyers on the case have that data stored on the firm’s IT systems in multiple places — lawyers exchange emails with documents, there’s a review platform with data, individual lawyers have email folders with client info on their desktop computers, and maybe there’s a client portal sharing info among firms or with the client.  We’ve even seen lawyers who save “hot docs” for a case to their hard drives or on Dropbox to access on a mobile device.  The list can go on and on.

The case is then resolved, and law firm closes the file and stores it according to the state’s requirements for how long it needs to be kept — let’s say 7 years (that’s a normal requirement for most states).  To further complicate matters, no firm wants to charge a client for culling the file after the case is resolved, and no client wants to pay for it.  So, less is done than otherwise would be.

Sometimes parties will have a protective order saying that all information should be destroyed or returned within x number of days after resolution, but that rarely happens.  And, if it does, only the large production files are returned or purged.  Rarely have we seen a law firm undertake an effort to gather and cull all client data from its systems.  So, all of the client’s discovery sits on the law firm infrastructure.  And a complete copy of it gets stored with the case file for at least 7 years.

Two years later, a new matter arises for that client that implicates most of the data from the earlier case that’s closed.  The client has systems in place that have purged most of the data that would be responsive (think email as your primary concern).  But the law firm still has the data.

Is that data at the law firm still in the custody or control of the client?  You bet.  And now you have to pay another firm (if you have different counsel for the new case) to go to your other firm and work with them to get the data out of their systems.

BLECH.  We’ve done it, and I can tell you, it’s painful for everyone.  Most clients won’t be happy paying a firm to sort out their data they feel should have been kept better in the first place.

Ethical rules require attorneys to keep case files for a certain period of time, but a case file need not include ALL of the client data provided for discovery in the case.  That can be returned to the client or purged — and the client then returns to their normal procedures for retaining data. It’s up to the client.  For a good discussion of the ethical requirements in maintaining electronic files, check out Tim Pierce’s article from the Wisconsin Lawyer.  Tim discusses ethics opinions from multiple states.

What’s the solution?  Every case will be different, of course, but here are some good general guidelines for how to combat this issue of creeping client data:

  • Law firms need to talk with their attorneys about how and where to store client data to avoid data sprawl throughout the organization.
  • Law firms need to have a process in place — think of it as an exit interview for your client’s data — to identify where client data exists and pull it all from the day to day systems for storage or return to the client.
  • The law firm’s process also needs to include verifying the purging of data from any third party vendor that it contracts on behalf of the client.
  • Law firms need to put language in their engagement letters with clients AND DISCUSS IT WITH THE CLIENT at the outset of the matter explaining the exit interview for data process.  Consider a flat fee for the client to cull data and close the file down that includes the information/discovery management piece.
  • Clients need to require their law firms to follow the above guidelines to manage their cost and risk when new matters arise.
  • Managing information needs to be included on a file closing checklist for law firms and clients.

Creeping client data has two potential downsides:  increased expense with more data, and spoliation potential.  If you have data that you would be under a duty to preserve at your law firm,  you better be managing that with the firm.  If you don’t, and the other side gets wind of it, you could face a motion for spoliation and sanctions that could undermine the merits of your case very quickly.

Be smart — plan for and avoid creeping client data.  Nightmares ruin your whole day.

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