brought to you by

Back in the good old days, lawyers produced paper to use as evidence in litigation. This process is called discovery. Most companies and institutions kept their papers in relative good order, making the discovery process simple and straightforward.

These days, though, corporate and institutional records are handled in a fast-moving variety of electronic records, from e-mail to Voice Over Internet Protocol voice mails to Word documents to spreadsheets to some forms of text messaging. Some of these records evaporate from computer systems quickly. Others persist for years -- or decades. And it can all be hauled into court.

And new federal court rules that went into effect Dec. 1, 2006 put an obligation on companies and organizations to preserve this electronic information when they know or "reasonably should know" of pending litigation.

"That's a huge change in the rules, this affirmative duty to preserve," said Brian Ziff, team lead of the e-discovery practice group at the Detroit law firm Clark Hill PLC.

Ziff said companies and organizations should respond to this new rule in two ways: First, by establishing a policy on the retention of electronic records and ensuring that it's followed, and second, by establishing a policy on how to obtain and organize electronic records in the event of a lawsuit.

And just because the rule has been established only in federal court, not Michigan's state court, "you're not off the hook in state litigation," Ziff said. "My experience in Michigan is that some judges will look to the federal rules for guidance ... so it makes good business sense and good risk management sense to get out in front of e-discovery and have policies in place to help you anticipate the day you get sued."

Ziff said many clients have policies that delete non-business-critical e-mails after 30 days. Exceptions are made for information that has a regulation or law attached to it -- seven years for accounting information, for example -- and electronic documents or e-mails concerning critical intellectual property.

"The art is crafting a policy that can be upheld and makes it efficient for your company," Ziff said. "We see a lot of companies tha don't have efficient and effective e-discovery policies. A lot of companies have e-mail policies but no idea what to do with that e-mail once they get into litigation -- how to gather it, how to put your finger on electronic information when you need it. That's where we come in, pre-litigation management."

Ziff said he's been on both sides of e-discovery disputes. One client, he said, had a policy in place and was able to quickly respond to e-discovery requests wtih the help of Clark Hill and an outside tech vendor. "I won't say it was cheap but it was efficient and we only had to go through the process one time," Ziff said.

In another case, Ziff represented a party suing a company that aggressively deleted e-mails once the suit got filed. "They were sanctioned by the court ... the judge read an adverse jury instruction, in which the jury was told that every single piece of missing electronic evidence could be assumed to be beneficial to us," Ziff said. "We won a jury trial and millions and millions of dollars in compensation. The other side did it all wrong and got nailed for it."

Ziff said he believes Detroit Mayor Kwame Kilpatrick's text message scandal has more of his clients thinking about e-discovery.

"I hope so, anyway," he said. "One thing people also need to remember is that when we talk on a Voice Over IP phone system, the voice mail you leave me is treated by our server just like an e-mail. It's going to be saved on a backup tape and one day will be discoverable."

With more and more PDAs, home computers and other devices floating around with corporate information on them, a policy is more critical than ever, Ziff said.

More at www.clarkhill.com. To contact Ziff, e-mail bziff@clarkhill.com.