money circles

 

While e-discovery once seemed like the new frontier of technology, today it has become a routine part of practicing law. What's not routine, however, is e-discovery pricing. Despite the fact that the practice has been around for several years at this point, budgeting for e-discovery and predicting your needs throughout the life cycle of a matter haven't gotten much easier. From per-user fees to per-gigabyte rates, creating an accurate e-discovery budget can seem like an impossible task. The good news, though, is that by understanding the various charges and all the steps of the process, you'll be well on your way toward predicting costs that previously seemed unpredictable.

Common E-discovery Charges

Chances are, if you've managed a large e-discovery matter, you've been handed an invoice of varying charges that take a fair amount of time to sort through. The first step in budgeting for e-discovery is understanding the different types of charges you might encounter. The following are the most common.

  • Per gigabyte: When you're dealing with data, you'll typically be charged by the gigabyte. Data ingestion, processing, production, hosting and analytics are usually billed at a per-GB rate. Because the size of document productions varies widely, so do the total per-GB charges from case to case.
  • Per user: Depending on the database your service provider offers, you may be charged a user fee for every person accessing the data.
  • Per hour: Ongoing functions performed by your service provider, such as database support or data management, are usually charged out at hourly rates.
  • Per page/per document: Several e-discovery functions are billed on either a per-page or per-document basis, including productions, OCR, Bates stamping and certain analytical offerings.

With any given e-discovery project, you'll see a mix of each of these kinds of charges on your monthly invoice. One of the things that makes predicting costs so difficult is that these amounts can vary widely throughout the course of the project. For example, you might know how many gigabytes of data you're bringing into the case, but it's often much less clear how much of it will be culled out, which greatly impacts your ultimate processing, hosting and production costs.

Per-user fees can be equally unpredictable at the outset, as the number of reviewers might change over time as things like the volume of data or deadlines evolve. You also need to keep in mind the different price points of your staff if you're trying to predict attorney fees—first-level review, partner review and QC work all likely get billed out at different rates. There's also a common tendency to underestimate support costs. You may think you understand your database and need very little in terms of support, but there will inevitably be nuances that you didn't foresee, don't understand and need assistance with.

While all this may sound discouraging, it doesn't have to be. Thankfully, there are things you can look for and questions you can ask that will make it much easier for you to anticipate your total charges and create e-discovery budgets going forward.

Getting the Information You Need to Make an Accurate Budget

The biggest thing you can do to make budgeting for e-discovery easier is to ensure you understand all the possible charges before you go in. When you understand every line item that might show up on your invoice and what the functions of each are, there won't be any surprises at the end of the month.

All of these fees should be discussed in detail before you sign on with a vendor. This is the time when you can and should ask as many questions as you want. Request a breakdown of all the fees the vendor charges for various aspects of the project and how and when those charges are incurred. Ask what your options are if your case is stayed, settles or ends: Are there fees for different kinds of storage? What happens to your data when the project ends? Both during and after the case, where is your data being stored?

The overriding goal is to avoid any surprises as the project progresses. By walking through the entire life cycle of a case with your vendor and pinning down how every aspect is billed, from initial ingestion to conceptual analytics to post-case storage, you'll gain the knowledge necessary to break down a budget based on the characteristics of your individual project.

What to Avoid

Answers to your questions are your best budgeting weapon. While the intricacies may be complicated, the answers themselves should be straightforward. If you're speaking to a vendor who won't give you clear answers, or if the answers you're getting just leave you with more questions, that should be a huge red flag to find a different service provider. You should walk out of your meeting understanding exactly what charges will or will not appear on your invoices going forward.

You also want to avoid paying for data you'll never use. May providers will charge a per-GB ingestion rate just to cull your data down. While the fees may sound nominal at the outset, if you manage to cull the vast majority of the data you initially turn over, your client just got charged for things that you'll never even look at.

Tackling the Actual Budget

Armed with all the necessary information, you're now in a much better position to hash out an accurate budget. The only way to find the best prices is to come up with a comprehensive picture of your project that you can present to every potential service provider. This involves sitting down with your litigation support and case teams to draw out in detail all the steps of the e-discovery process, from how much data will be gathered and how much is likely to be culled to how many reviewers and how much support time you anticipate needing, so you can make educated assumptions to work off of. You can then take those assumptions to your service providers as a basis for price quotes.

Many e-discovery vendors have different pricing models, which makes it difficult to perform an apples-to-apples comparison. However, if you give them all the same information going in, you can at least do a true comparison of their quoted prices based on the overall estimated project cost. Even if your assumptions end up changing, budgeting for e-discovery no longer has to be a myth, but can be a quantifiable reality.

 

Chris Esposito, a Relativity Certified Sales Professional, is a Senior Litigation Consultant with The MCS Group (www.themcsgroup.com).