Time to Update
(Or Create) Your Litigation Readiness Plan
Just how confident are you that your company is prepared to tackle whatever litigation comes your way? If your answer is less than “highly confident,” you’re not alone.
In its 2022 Global Disputes Forecast, law firm Baker McKenzie reported that 35 percent of respondents to their fifth annual survey expressed a high level of confidence in their litigation preparedness. While 36 percent expressed a moderate level of confidence, 20 percent said they were “slightly confident” or had “low confidence” in their preparedness.
Companies with higher annual revenues tended to answer that they were more confident in their preparedness, Baker McKenzie noted.
The Role of a Litigation Readiness Plan
Litigation readiness planning informs an organization as to how it will respond in the event it has a reasonable anticipation of litigation.
No two companies are alike in their current needs, technology, history of litigation and prospects of litigation. This means litigation readiness plans are unique to the individual company developing them.
There are several notable upsides to preparing a litigation readiness plan:
- it puts your company in a better position to determine whether it should settle or litigate claims;
- reduces stress and litigation costs; and
- prevents lost data, lost time and lost tactical advantage.
Think your company is too small to have a plan in place? Consider another upside to litigation readiness planning: it can make your company more attractive to investors. Companies that have documented litigation readiness plans have a lower overall risk profile, which can help boost their attractiveness on the market.
How to Create a Litigation Readiness Plan
With all the upsides associated with litigation readiness plans, it’s easy to see why they are so vital to an organization. If you don’t have one, it’s not too late to develop one. Litigation readiness plans take thought and effort to prepare but that work pays off in dividends.
Here’s how we recommend approaching planning.
1. Develop a Data Map
At its most basic, a data map is a concept map that identifies where your company’s data, also referred to as electronically stored information, or ESI, resides.
The importance of knowing where your data is housed and having the ability to access it quickly during litigation cannot be understated. If you don’t know where your data is or who has it, it can be difficult, if not impossible, to issue a legal hold preserving it for discovery. Additionally, knowing where your data is located aides in your ability to efficiently produce it and keep eDiscovery costs down.
At Array, we recommend that data maps not only include data location, but also reflect who is responsible for maintaining the data inside and outside of the company, and where the data backs up, if backups are made.
2. Determine Your Legal Hold Triggers
Under the Federal Rules of Civil Procedure, a company’s duty to preserve data begins at the point at which it reasonably anticipates litigation. If that sounds vague, it’s because it is: the reasonable expectation of litigation can vary greatly from company to company and situation to situation.
Some in-house attorneys rely on their judgment and gut feeling to determine whether they should start preserving data for potential litigation, but that approach comes with pitfalls, including potentially not preserving data as early as one should.
Rather than taking the “I’ll know it when I see it” approach, in-house counsel should work to identify legal hold triggers based on their team’s perspective and company’s historical need for them.
Such triggers can include the moment when it becomes clear that the company can no longer settle a demand or an incident occurring that is similar to a prior recent litigation trigger.
Proactively defining your company’s litigation hold triggers is protective in the long run because it can provide documentation as to the company’s policies and protocols. Having such documentation protects against opponents who assert your company should have started preserving data earlier.
3. Talk With Other Departments
Creating a litigation readiness plan should extend beyond your company’s legal department to include stakeholders from departments across the company, including human resources, compliance, information technology, records, communications and management teams.
In-house counsel should talk with their peers across the company about their unique litigation risks and how the organization plans to respond to litigation.
Engaging HR is especially important, because disputes involving HR dominate litigation across companies and can be especially costly to litigate. Working with HR before litigation occurs to refine dispute resolution workflows and determine when preservation should be triggered can help reduce litigation costs.
Likewise, coordinating litigation readiness with your company’s IT function is invaluable when it comes to accessing and preserving data.
Don’t make assumptions as to your IT department’s capabilities in terms of capturing information or their preparedness to do so — part of putting your plan together for litigation readiness includes defining their role, knowing their capabilities and providing training so that they’re ready to respond to a legal hold.
Coordinating with IT in advance can also help you avoid the tendency to over collect data with the intention of filtering it later, which can be costly.
Working closely with IT is also crucial in terms of being prepared to preserve data during computer system changes or the adoption of new technologies as a company. Changes in technology can quickly make old plans obsolete.
4. Develop Workflows and Document Their Use
The next step is to develop workflows for processing legal holds.
After defining your legal hold triggers, you can move on to drafting a legal hold notice that will serve as notification to individuals and departments in your company that they need to preserve ESI in anticipation of litigation.
Once your in-house team believes that litigation will occur, it will need to send the notice to the appropriate individuals as well as IT, keep track of employees’ acknowledgements and answer their questions, work to preserve ESI that’s subject to the litigation hold, follow up with custodians of the data to periodically remind them of the hold, audit their compliance, and, eventually, release the litigation hold.
Once developed, train staff in the workflows and ensure they’re adhering to the processes set out in the plan and documenting their work. Consistently adhering to the plan will help defend your organization in court, should an opponent challenge your ESI preservation decisions. If employees routinely diverge from documented policies, it can create risk for your company.
5. Create and Train on ESI Protocols
Lastly, we recommend that, as part of your litigation readiness planning, you develop ESI protocols and workflows and train employees on them.
Frequently, we see companies respond to requests for production of discovery by pulling data without regard to ESI or the specific needs of the discovery request. To be responsive to the request, data might need to include certain metadata fields or be organized in a particular way, for example.
Without a workflow, pulling data at random can end up a waste of time for in-house legal teams if they realize later on that they did not complete the job properly and must now do it again. Nobody wants to end up in the position where you’ve done the work, but it wasn’t completed in the way that it needed to be.
Updating Your Litigation Readiness Plan
If you have a litigation readiness plan in place, but haven’t updated it recently, there’s no time like the present to consider reviewing it to make sure it is still meeting your organization’s needs.
With ever-changing technology and disruption in the workplace brought on by the COVID-19 pandemic, it’s worth reconsidering your plan in light of how employees work now, whether by working remotely or using applications for routine intra-office communications like Slack and Microsoft Teams.
There’s no hard and fast rule for when your organization should revamp your litigation readiness plan. We recommend reviewing your plans on a quarterly basis to ensure the plan’s language is up to date and reflects the technology your company is presently using.
That doesn’t mean you have to change your entire plan that often, but elements like your data map may need updating as new technologies come online.
Revisiting the plan on a quarterly basis is also helpful for maintaining your company’s privilege list — a list of employees in your legal department whose communications are privileged and should not be handed over to opposing parties.
Don’t Go It Alone
Feeling overwhelmed by the process of litigation readiness planning? eDiscovery vendors can be an invaluable source of information as you work to prepare your litigation response plans. Not only do they provide consulting services, like helping you assemble your data maps and keeping them updated, they also frequently provide technology solutions that can help you identify potential litigation very early on.
For example, Array offers a solution that can scan company emails in real time for text, raising red flags internally for issues like sexual harassment.
eDiscovery vendors have seen the good, the bad, and the ugly when it comes to litigation, and can provide clients guidance on avoiding common pitfalls. Engaging an eDiscovery vendor before litigation strikes can help boost your confidence in your company’s ability to take on whatever comes its way.