What can a guy who lived in China in the fifth century B.C. teach us about e-discovery? A lot, as it turns out.

Sun Tzu was an ancient Chinese military general, strategist, and philosopher who wrote the Art of War. Not only is this book influential on military strategy, it is now widely read for its insights on business strategy. The lessons of The Art of War are simple, but have deep and fundamental ramifications. These lessons relate not only to military strategies and tactics, but to all facets of life. The Art of War is organized by lessons. The first lesson is "Be Prepared" and is especially important for businesses who have become entangled in the morass of e-discovery.

Specifically, in Lesson 1, Sun Tzu writes, "The art of war teaches us to rely not on the likelihood of the enemy's not coming, but on our own readiness to receive him; not on the chance of his not attacking, but rather on the fact that we have made our position unassailable."

The same is true for businesses dealing with e-discovery. The question is not if you will have to deal with e-discovery, but when.

Employers should determine their e-discovery capabilities and sources of information. If you have already been sued or expect to be sued in the near future, do so immediately. Ideally, the prepared employer will perform this self-examination before litigation ever arises. To be prepared, determine where electronically stored information (ESI) is located, whether the company backs up data, and who has access to ESI. Seize the advantage by getting your own house in order before pursuing e-discovery aggressively from the other side.

Working with its counsel, employers should then create a plan for the collection of potentially relevant data:

  • First, identify all potential players, and prioritize key players. Players are those individuals, referred to as "data custodians," who may have key information stored on electronic sources. Reviewing the key players' data first may uncover critical information and assist in developing new strategies.
  • Second, interview potential players and IT Staff. Understand how the company network is structured and how each individual creates and saves his or her data. Be aware that, no matter how good your IT staff is, it will likely lack the capabilities to manage your e-discovery needs. Employers must know the capabilities of its IT staff, as well as those areas where outside help is needed.
  • Third, determine where the data is physically located. Data can be located on site, at multiple office sites, or at storage locations. Cloud computing adds an additional level of complexity; the company's IT department should know where all company data is stored. It can be helpful to develop a "data map" listing and describing the locations where the company's data is stored, the IT chain of command, and the types of devices the company uses to store data.
  • Fourth, create a chain of custody to document where, when, and how each piece of ESI was discovered. This will help ensure that metadata is preserved and not inadvertently altered. Outside counsel and third-party vendors can help immensely with this process.

A critical component of the e-discovery process is the issuance of a litigation hold. Taking the following steps helps ensure an effective litigation hold:

  • Implementing litigation hold policies and procedures before issuing a hold actually is necessary.
  • When a party becomes reasonably aware of anticipated litigation, it should issue the litigation hold. Actually issuing the litigation hold involves suspending routine document and data destruction. In this step, parties also should save or suspend recycling of back-up tapes. Parties then should notify archival facilities to suspend destruction and to preserve ESI. Again, the prepared employer's IT department will know where the data is located and will have procedures in place for implementing the requirements of the hold.
  • Parties cannot implement a successful litigation hold unless they monitor compliance and send periodic reminders and updates. Remind custodians that a litigation hold is in place, and describe the consequences for failing to comply with the hold. Send written documentation of the hold to custodians every few months to ensure that, in the event data preservation efforts are questioned, evidence of compliance efforts is available.
  • Employers should also consider getting bit-stream images for key and departing employees; obtaining certifications from IT personnel to establish chain-of-custody; and, for larger companies, forming an ESI discovery/document-retention team.
  • Notify custodians and players of the members on the team. For consistency and accuracy, direct all questions and inquiries to the team.

Applying Sun Tzu's first lesson to e-discovery can save employers time, money, and a major headache if they are prepared in advance of litigation. An employer confident in its e-discovery readiness and procedures gains an immediate advantage over an adversary in litigation, and can often use that advantage to leverage a more favorable settlement or to win the case outright.

As Sun Tzu wrote, "He who is prudent and lies in wait for an enemy who is not, will be victorious."

www.cozen.com

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