Anyone who watches TV has likely seen the Microsoft ad for its AI technology. It wasn't long ago that artificial intelligence was considered so difficult to understand—and confined in its usage to highly specialized pursuits—that experts sighed at the thought of having to “dumb it down” to explain it in to consumers and no one thought of it as a selling point.

What, then, does it signify that AI has gone from not being talked about to the widely advertised? Certainly it indicates that, at a minimum, consumers are, generally speaking, somewhat knowledgeable consumer users, as AI would have no meaning to those not knowledgeable regarding computer usage. It may also indicate that consumers are at least minimally comfortable with the generalized issues of AI. Information security, for example, and who has a right to access the personal data of a user or the subject of a digital communication, are issues that have always existed, but have become far more the hot topic with the increase in the number of locations data can be stored (the user's workstation, a server at a business, Cloud servers and backup servers), and with that increase came the rise in hacking and the number of laws enacted to try to protect such data.

And consumers in the legal world are more and more discussing one of the biggest issues pertaining to their involvement with computer usage: electronic discovery. Should AI be used in e-discovery review? Should firms bring e-discovery in-house and no longer rely upon e-discovery vendors? In this month's article, we will analyze how to try to answer those questions.

Increased Discussion of IT Issues

Many factors have led to the increased discussion of esoteric IT issues, and it is hard to determine which factors are the cause or the result of other ones. The integration of digital media into all aspects of our personal and professional lives is certainly one factor. Personal conversations now are quite frequently a combination of in-person, telephone, email and text messaging, with the latter two types of conversations leading to a large increase in stored digital files. Hand-written documents that became typed documents are now usually digital documents from the start. And because it is much easier to label each version of a digital document and save it in case you want to return to an earlier version than it was to keep numerous paper versions of the same document, the volume of digital documents has grown. That volume has further been increased by the fact that new types of digital documents now exist due to the ease of creating and saving them as well as because of their value to the user. Survey or response documents, with check boxes to yes or no or limited answer questions and areas to provide narrative responses, are routinely sent by firms in innumerable businesses, to get information pertaining to specific matters, to get feedback from a customer as to whether a service was provided to the customer's satisfaction, and for many more reasons.

All of these new digital document types have increased the volume of e-documents in any given e-discovery matter. With the increase in volume has come an increase in the number and size of locations where such documents are stored. Years back, e-documents were stored on the sender's, recipient's or creator's hard drive. Now, in most businesses contending with any volume of e-documents, they typically reside on the sender's/recipient's/creator's hard drive, a server kept either in-house by the business or in the Cloud, and on a back-up server for the in-house or Cloud server. With the increase in data volume and locations, we have seen a large increase in data breaches, as well as the creation of laws (from local to international) specifying what type of data is considered private and what steps someone in possession of another's data must take to protect that data. Organizations such as the International Organization for Standardization, or ISO, produce data protection standards; inspectors review the data protection a client has in place and then certify the client as ISO compliant or provide the client with a list of steps to take to reach compliance (and re-inspect if the client informs the inspector that it has taken such steps). Inspection standards include both those set forth in all applicable laws and those promulgated by the inspecting organization.

As well, the growth of e-discovery, IT security concerns and younger lawyers as a percentage of the total number of lawyers practicing has led to an increase in interest in and understanding of digital technical issues by attorneys. The days of, “I'm a lawyer; I don't know anything about these newfangled computers,” are disappearing quickly and will continue to disappear as older attorneys retire and new ones, who grew up with digital devices, pass the bar.

Given all of these factors, it is hard to say whether the discussion of esoteric IT issues is the result of the increase of the volumes of data users now possess, IT storage, the number of hacks or attempts to hack into IT systems, the laws enacted to address privacy and data protection issues or of the knowledge of and interest in computers by attorneys. Ultimately, it does not really matter whether the chicken or the egg came first, given that both are entities which must be addressed carefully.

Addressing the Cost of Compliance

 One factor the discussion of which continues to grow at a dizzying pace is whether clients—in particular here, law firms—should bring e-discovery in-house. More yes votes for that proposition are to be counted every day, but it is by no means clear that that is the direction e-discovery will take, as it is far easier to advocate for bringing e-discovery in-house than actually to do so.

Bringing e-discovery in-house seems appealing when the price the vendor charges seems either disproportionate to the value of the matter or simply so high that the client balks at retaining the law firm or going forward. That price, however, may be the most economical one, regardless of how high it may seem, when one considers in a realistic manner all of the factors involved in bringing e-discovery in-house.

The cost of retaining a vendor is most likely to seem too high when an e-discovery matter is straightforward, regardless of whether the cost is low in a relatively small case or high in a large one. If data is collected and placed in a database for review, and the review results are then produced in a digitally printed format, e.g., PDF, how would that differ, for example, from collecting facts and cases, placing them in a file for review, emerging with a resulting brief and, digitally printing the brief and then submitting it to the court and distributing it to opposing counsel? As the latter task has become the daily work of attorneys, the question of why e-discovery is still outsourced had grown.

The answer to that question may lie in whether it is proper to characterize the e-discovery matter as “straightforward” or only “appearing to be straightforward.” The source of materials in writing the brief will be e-documents the attorney already possesses, i.e., the ones which contain the facts discussed in the brief or laws, rules and case law which the attorney will readily obtain from well-known and widely used law library databases. The cost of the e-documents will be, relatively speaking, nothing to counsel, inasmuch as the client has already been charged for collecting them was part of hourly fees charged by counsel (e.g., the notes taken during a client interview are an e-document that the client pays for when paying counsel's fees for the interview), while storing and accessing them is part of the overall cost of the IT system the law firm must possess and use to operate.

The cost of producing the e-discovery, however, results from services and expertise almost none of which are already a part of the firm's makeup. The raw data from which the e-discovery e-documents will be extracted, reviewed and produced must be collected forensically from multiple sources. The firm will either have to have on staff data-collection experts or (more likely) outsource this service to a vendor. Usually several terabytes of data will be collected, since the forensic collection of the source data will mean forensically duplicating the hard drives of each user's computer, as well as of the server, even if only a fraction of the hard drive contains the data relevant to the matter. The cost of obtaining and maintaining servers to house collected data will be great, as will the cost of providing IT security for this data, now within the control of the firm. In addition to providing online security, the firm will have to train all personnel in implementing security protocols, audit its work to ensure that such protocols are followed, and take many more steps to protect the data it has collected or has had forwarded to it by the data-collection vendor.

As well, the firm will then have to have trained data processors deploy licensed applications to search the collected data for responsive data and make sure there are no duplicates. The costs of these applications and the expert data processors will be considerable. Additional costs will result when the demand for such services goes up and down over time, as is usually the case. When the demand is high, and deadlines cannot be extended, additional data processors may need to be brought on quickly and additional licenses for processing and search applications will have to be obtained, usually at an annual fee even if they are not needed (or only some of their services are needed) for that long of a period. When the demand is low, the firm pays licensing fees for unused applications and wages to bored data processors who take long lunches. In total, then, it is at best unclear, and at worst emphatically not true, that bringing e-discovery in-house is the best way for a firm to obtain such services.

Conclusion

I live in Philadelphia, and frequently drive on, or observe, Interstate 76, also known as the Schuylkill Expressway, which cuts through the city. During the work day the road is very busy, with traffic often coming to a standstill, while at night and overnight traffic is scarce. It is easy at those busy times to berate the commonwealth for not having made the road wider or narrower. These criticisms are flawed for the obvious reasons: Widening the road would simply invite more traffic until the wider road was jammed, while narrowing the road would lead to traffic jams on numerous other roads.

The same issues arise when a law firm considers whether to bring e-discovery in-house. It is so easy to ask why a firm (truly, the firm's client) must pay a vendor to house data that is infrequently looked at after discovery has been produced, or only small parts of are looked at when the truly disputed contentions of the matter are litigated, but no one asks such questions at litigation “rush hour” when terabytes of data must be forensically collected, processed, searched and reviewed, and the final product produced to opposing counsel. Attorneys today have a far better understanding of that process than they did when e-discovery came upon the scene 20 or so years ago, but they still lack the expertise of those who collect, process, search and produce the data. The increased understanding by attorneys of digital applications and issues gives them the ability to focus properly, and as economically as possible, on the steps that must be taken to produce e-discovery, but the digital world still has well too many factors, and unknowns, to make bringing e-discovery in-house a good idea. That reality may, of course, well change; indeed, the discussions now may be the beginnings of such a change. When it does change, law firms will move quickly, but until it does, they serve their clients and themselves best by continuing to narrow the gap between what they and the experts at e-discovery and related companies know.

Leonard Deutchman is a legal consultant recently retired from one of the nation's largest e-discovery providers, KLDiscovery, where he was vice president, legal. Before joining KLDiscovery, he was a chief assistant district attorney at the Philadelphia District Attorney's Office, where he founded the Cyber Crime Unit and conducted and oversaw hundreds of long-term investigations involving cybercrime, fraud, drug trafficking and other offenses.