The very foundations of legal practice were adjusted earlier this year with the introduction of the Federal Court's Practice Note 17. The time is now, writes Red Bolton, for lawyers to learn their new responsibilities around eDiscovery
29 January 2009 was a wonderful day for article clerks around Australia.
Most were probably oblivious to the effect Chief Justice Black's updated Federal Court Practice Note 17 will have on their lives, but those who have been before them will understand.
No longer will the young legal eagles have to ask themselves why, after five years of study, they are called upon to do the job of carting hundreds of boxes of discovered documents into court for a hearing. But before you older lawyers lament losing the opportunity of assigning this 'character building' task, it might be worth considering what new challenges you can give your young up-starts, because under this new regime, there's sure to be a few.
What is now expected of lawyers?
On the face of it, the expectations of Practice Note 17 on lawyers are minimal. In fact, the note actually goes to particular lengths to try and simplify the whole electronic discovery process.
The Court calls for efficient document management practices supported by simple technology, such as Microsoft Excel spreadsheets and PDF documents. This means that lawyers have to list their discoverable documents in an Excel spreadsheet and then submit the documents in PDF format. And if that's too difficult, the Practice Note even includes the creation of eRegistrars in each registry, these being registrars charged with the specific task of providing advice and assistance in relation to the implementation of the Practice Note. While this all may sound easy and simple, producing the documents is only one part of the bigger e-discovery process.
Understand how the client's data management systems work
As pointed out by a Federal Court spokesperson contacted by Lawyers Weekly, one of the goals of Practice Note 17 is to encourage lawyers to be efficient in their document management practices and to "capture only those documents that are specifically relevant to the dispute". This is where things start to get a little tricky.
Discovery is no longer as simple as going through your clients' filing cabinets. Instead, discovery is now a complicated process involving mountains of data - requiring lawyers to know where the data is stored, and just how it's accessed. "We see even small entities generating reams and reams of data daily and stored daily and it's stored in places most people wouldn't even think to have a look," says Paul McCann, litigation partner and leader of the legal technology solutions division at Corrs Chambers Westgarth. McCann adds that there is no doubt the new Practice Note expects lawyers to have a sound understanding of the legal environment and the technical environment in which data is stored. "If you're going to turn up [to court], you're going to be expected to answer questions on this," he says.
Beth Patterson, director of the applied legal technology department at Allens Arthur Robinson says technologies have been developing at the "rate of knots," over the past five years, meaning lawyers are dealing with a phenomenal amount of data.
Patterson uses words such as "e-duplication", "near-e-duplication", "key-word searching", "concept searching", and "cross-functional teams". She speaks of a nexus between lawyers and technologists. It's a learning curve on both sides of the fence, she explains, with technologists starting to understand the legal side and lawyers beginning to better understand the technology. "For example," says Patterson, "five years ago I would guess that there weren't many partners in our firm that would know what "e-duplication" meant in terms of electronic discovery, now it's a strategy they ask us to employ."
The need for early preparation
Another goal of the Practice Note is for lawyers to identify documents relevant to the dispute as early as possible. This creates an obligation on the lawyers to get their act together early, says Susan Bennett, a partner at Sparke Helmore. "The courts are looking for the parties to have, at the time the discovery orders are made, already looked at what documents are going to be discovered, the scope of the documents to be discovered, and any issues likely to arise," she says.
Bennett's advice is that if you are contemplating commencing proceedings or if you're on notice that proceedings are likely to soon be commenced against your client, that you immediately begin looking at the scope of documents that are likely to be required.
This new regime places greater pressure on lawyers to be on top of their discovery - but as Bennett points out; there are benefits that flow on from this. It provides an opportunity for parties to have a more focused discovery and limit the amount of documents needed to be produced. At the same time, it helps set up a dialogue on discovery which can be used as a mechanism for dealing with issues later down the track.
Particular demands on in-house lawyers
In-house counsel plays a particular role in setting up a focused means for discovery. "In-house counsel are quite often going to find themselves being the interface between the IT side of the company and the external lawyers," says Michael do Rozario, a senior associate at Corrs Chambers Westgarth, and a QUT graduate in information technology. "There are potential difficulties in that situation, particularly if in-house counsel are not equipped or do not understand the questions that are coming from the opposing lawyers or from their own IT section."
Patterson agrees that lawyers must now have a strong understanding of their client's IT systems. "I think with in-house counsel they need to be more proactive in planning what their preservation strategy would be," she says. "For example, if they were litigated against, where does their data reside and how would they collect it? And particularly for big corporations and multinationals that have offices worldwide, that's significant because if litigation is underfoot, they're the ones in the firing lines that have to make it work."
Use of external providers
One of the changes expected as a result of these e-discovery demands is an increase in the use of external providers. Patterson cites the Socha-Gelbmann Electronic Discovery Survey, which predicts the US legal technology business market to grow from $2.8 billion in 2007 to $4.6 billion in 2010, off the back of increased demand for third-party e-discovery experts. do Rozario refers to the US Fannie Mae Securities Litigation, where a US government body spent $6 million on e-discovery and still found itself in contempt, as an example of what can go wrong.
"If you don't understand your client's computer systems, you have to provide the court with someone who does," says do Rozario, who believes the development of Australian law in this area is likely to closely follow that of the US.
Consequences of failing to comply
While there might be a greater use of external e-discovery experts in the future, lawyers should not fall into the trap of thinking that they can outsource their discovery duties, says do Rozario. "This is still part of the old fashioned discovery process," he says.
"And at the end of the process your client is going to have to swear a list of documents and the lawyers are going to have to certify the fact that they provided proper instructions to the client in relation to the list of documents. So this set of rules doesn't let either the law firm or the client escape from their general discovery obligations to produce all the relevant documents in the litigation."
As with any discovery, failure to comply can have serious consequences. do Rozario says that there have been a range of cases in the US where people have tried to manipulate the discovery process and been caught. One particular case he mentioned was the Qualcomm Incorporated case where some 46,000 emails were not produced in discovery when they should have been. The company was ordered to pay $8.5 million in costs and the lawyers were referred to the relevant bar association. "The sorts of penalties in the US are not inconceivable in Australia," says do Rozario. "Doing this wrong could, in the worst case scenario, potentially cost you your practising certificate."
What lawyers can do
The first thing lawyers can do to ensure they comply with the new rules is to actually understand what the rules are trying to achieve, says do Rozario. "Just being knowledgeable about what it entails is very important. In doing that you'll become aware of where the limitations in your expertise are, and where you're going to have to find yourself help."
Patterson suggests lawyers attend industry conferences, read articles and engage experts, while also ensuring that they are aware of, and making use of, the eRegistrars. "I think it's clearly significant that the court has created a new position (eRegistrars) to support and to understand that there's a learning curve out there for the industry as well as for the court themselves," she says.
The Federal Court spokesperson recommends lawyers start by reading Practice Note 17, and then continue to monitor the Federal Court's website for updates to the "related materials".
As for senior lawyers concerned they will not have any menial tasks to assign their slaves, sorry article clerks, never forget about the much needed coffee run.