Reducing eDiscovery Costs vs. Law Firm Profits

I have spent the better part of the last two (2) weeks talking with top litigators from AM 100 Law Firms, eDiscovery service providers, eDiscovery consultants and the General Counsel from corporations that are either currently involved in cases with major eDiscovery costs or have recently complete a case with major eDiscovery costs.

What has been interesting is watching the ongoing battle between the General Counsels trying to reduce the overall costs of eDiscovery and the Partners from the AM 100 Law Firms trying to maintain their profits margins.

I have posted several extensive articles on the cost of eDiscovery and therefore I am not going to go over the details again.  As a review, Businesses and other organizations spent more than $2.7 billion on electronic data discovery last year, and spending on eDiscovery will grow to more than $4.6 billion by 2010, according to consultants George Socha and Tom Gelbmann, who presented their Sixth Annual Socha-Gelbmann Electronic Discovery Survey in a report published earlier this year on Law.com.  And, according to well know legal technology Blogger, speaker and general industry expert, Brent Barney, in a posting on law.com titled, "Subdue the Costs of Document Review", document review can account for 50 percent to 90 percent of the costs involved in a litigation matter.  And at $150 - $400 per hour, the classical docuemnt review portion of the eDiscovery process is a very large profit center for the AM 100 Law Firms. 

However, with the emergence of the discipline of Early Case Assessment (ECA) and associated technologies from legal technology vendors such as Clearwell Systems and earlyCASE,  designed to dramatically reduce the amount of Electronically Stored Information (ESI) or Electronically Stored Evidence (ESE), profits from document review are beginning to dwindle. And, the law firm partners that I have talked to are not very happy about it.  As a result, they are investigating whether or not they should be jumping into the ECA technology waters and setting up computer forensic practices to offset the loss in profits from document review.

Interestingly enough, and really the point of my article, is that the General Counsel and their associated Information Technology (IT) departments that I have talked to are also looking into whether or not they should be jumping into the ECA technology waters and setting up either internal computer forensic practices or partnering with independent third party computer forensic partners and third party ECA service providers to dramatically reduce the amount of ESI/ESE before it is sent to their outside counsel for review.    This investigation by both parties to this issues is shaping up to be a classical market paradigm shift and one that I and most of the eDiscovery world will be watching with great interest.

Please note that I will be attending LegalTech in New York February 2-4, 2009 and will post any and all additional opinions and data points that I can gather regarding this topic.

Labels: AM 100 Law Firms, Brent Barney, Clearwell, Clearwell Systems, Early Case Assessment, earlyCASE, eDiscovery, ESI, LegalTech New York 2009, The Cost of eDiscovery

posted by Charles Skamser @ 11:25 AM 0 Comments

New SaaS Player in Early Case Assessment (ECA) for eDiscovery

With the increased legal burden introduced by the changes to the Federal Rules of Civil Procedure driving the litigation market to contain costs related to eDiscovery, Early Case Assessment (ECA) solution providers such as Clearwell Systems have gained a tremendous following. However, at a cost of $150 per gigabyte to assess your case and/or develop strategies for Rule 26(f) meetings, there is still plenty of room for new and less expensive solutions.

And, it appears that Level 9, a software development firm out of Atlanta, GA has come up with a solution called earlyCASE to fill the demand for a lower cost ECA.

earlyCASE is a SaaS based eDiscovery application which uses an on-demand deployment model (runs on your local PC) and analyzes the ESI that your computer can access in-place without the data ever leaving your computer or network. earlyCASE allows you to quickly see and understand all of your data before it is sent on to Electronic Data Discovery (EDD) and document review. It supports multiple languages, extracts metadata, generates hash values, detects duplicates, email conversation threads and creates a local inventory database of documents and emails. earlyCASE allows users to make informed discovery decisions and easily cut down the size of data sets through filter and culling rules before going into the meet and confer, discovery processing and document review.

earlyCASE is offered in three versions, a Basic (FREE) version, a Professional version for a small flat rate charge, regardless of the amount of data you analyze, and an enterprise edition. The Basic version offers 28+ high-quality eDiscovery reports, one which estimates your processing and review budget while providing an immediate understanding of your data. With the Professional version, Lotus Notes and EnCase images are processed, a 26(f) report for meet and confer is available to help clients reduce legal risk exposure by offering a necessary view of the legal case information—custodians, context, third parties, and more.

earlyCASE provides you the tools and results to best understand, define and memorialize the ESI going into the meet and confer. Duplicate document detection, container processing (zip, rar, arc), Lotus Notes NSF’s and EnCase images are the primary reasons most people use the Professional version of earlyCASE.

earlyCASE basic is available for FREE, earlyCASE Professional is priced at $198 per run (unlimited data), and earlyCASE Enterprise licenses start at $8,000.

Having tested earlyCASE on my laptop, I found it to be extremely easy to load, easy to use and fast. It generated a reasonable quote of how much it was going to cost to process the data that I identified, provided an adequate number of standard reports for analysis and review and because it sits on an MS Access Database, I was able to build several custom reports that met my specific reporting requirements. All in all, I identifed and analyzed almost 20 gigabytes of data and it only costs $198 as opposed to the $3,000 it would have cost for the same basic information using other ECA tools.

earlyCASE is not an EDD tool. But, it seems to have filled the void for a lower cost ECA and hopefully has opened the door for more lower cost and easy to use SaaS based eDiscovery solutions.

Labels: Clearwell, Early Case Assessment, earlyCASE, ECA, eDiscovery, EnCase, FRCP, FRCP Rule 26(f), Lotus Notes NSF

posted by Charles Skamser @ 8:08 PM 4 Comments