Competence in e-discovery and document review has become a persistent and resounding theme throughout global litigation and regulatory investigations. Failures to preserve and produce relevant evidence in a timely manner have made headlines across the U.K., Europe and the U.S. in the past year, often with severe consequences.
In merger clearance reviews, which often require large-scale managed document reviews, deal approval and on-time closing may hinge on the organisations’ ability to disclose accurate, thorough, timely discovery. For example, in late January of this year, EU antitrust regulators stopped the clock on their investigation into a significant proposed acquisition, due to failure “to provide, in a timely fashion, an important piece of information that the Commission has requested from them."
In another regulatory investigation in Europe, our team was brought in to support the matter after the client received pushback from authorities relating to poor e-discovery and document review decision making. The regulators weren’t satisfied with the initial phases of the investigation prior to our team’s involvement, which led to additional time, cost and potential risk for the client.
Likewise, in high profile litigation, a legal team’s discovery aptitude and quality can make the difference between a successful resolution or large fines.
In a February 2023 ruling in the U.S., a judge ordered a $2.5 million sanction for defending counsel’s discovery failures, which the judge deemed as causing “cataclysmic” consequences for the case. Among the failures cited in the ruling included, “counsel’s failure to learn from the client that there were highly relevant emails residing in the cloud; counsel’s failure to timely disclose to the Court that relevant information had been destroyed; counsel’s use of relevant documents not previously produced in support of a motion for summary judgment;” and many others. A separate case in the U.K. in late 2022 had similar issues and outcomes, and in another U.S. case, the defendant’s delays and failures in producing key documents contributed to case terminating sanctions.
These breakdowns can happen for numerous reasons, but often, they occur because corporations are under extreme time pressure when selecting their e-discovery provider. Key considerations aren’t always fully addressed, and the quality of the outside team isn’t always closely examined. Unfortunately, oversights that an inexperienced team may perceive as minor can cause significant problems for a high stake, high pressure, time-sensitive case.
Conversely, when experts are involved, workflows for discovery and document review can be structured in a straightforward but sophisticated manner, so that efficiencies are built into the process, without undermining the quality and defensibility of the review.
Quality and defensibility are critical in every investigation, but there are certain characteristics that can exponentially increase the risk involved. These types of matters may face more scrutiny by outside parties, include nuances that increase the odds for mistakes to be made during review, or face more severe penalties in the event of a misstep. They include:
- Investigations under strict timelines, such as merger clearance and Second Requests.
- Cartel investigations.
- Multi-jurisdiction matters in which agencies from multiple countries are separately scrutinizing a regulatory issue, whistleblower accusation or other major violation.
- Circumstances in which cost is not the primary focus; in other words, critical matters that carry high value or high risk of financial penalty.
- High complexity situations, such as privilege sensitivity, data privacy concerns, cross-border data transfer requirements, simultaneously disclosing to multiple authorities, presence of emerging data sources, etc.
- End-to-end needs, from digital forensics and preservation to processing and early case assessment, to e-discovery analytics, document review and post-production activities.
Our global teams have encountered many matters where we’ve been brought in to rescue or completely redo reviews that were begun by providers with limited experience and capability in the kind of large scale, complex cases for which we are highly specialised. It’s important for counsel to remember to take the time needed to select the right team for the job at the outset to avoid mistakes that may later be called out as “cataclysmic” by a judge or regulator.
The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, its management, its subsidiaries, its affiliates, or its other professionals.