Social Media, Cloud Computing Top e-Discovery Challenges for 2011

2011 will be a transformative year for electronic discovery, as social media becomes more common and cloud computing raises new concerns over the control and security of data.

According to Fulbright & Jaworski's annual Litigation Trends Survey, 13 percent of respondents say they've been required to produce electronically stored information from social media as part of discovery. “This number isn't going to go down,” Brett Burney, founder and principal of Burney Consultants, said during a recent Webcast on e-discovery trends.

In employment litigation defense, social media discovery is “very powerful evidence,” and is being used more and more, said Ralph Losey, a partner of law firm Jackson Lewis and chair of its electronic discovery practice group. “We have a general rule of thumb: Thou shall Google,” he said. “Go out there and find out what you can. It's free discovery.”

Since neither the Federal Rules of Evidence nor the Federal Rules of Civil Procedure specifically address social networking sites as a form of evidence, courts are left to debate how much privacy—if any—people have on social media sites like Facebook and Myspace.

In one recent case, Romano v. Steelcase, the New York Supreme Court ruled in September that Facebook and Myspace messages that aren't publicly visible are not protected information under the Stored Communications Act (SCA), which prevents communication services from divulging private information to certain entities and individuals. Therefore, the court said, the records can be subpoenaed for use in civil litigation.

The case involved claims brought by an employee, Kathleen Romano, who sued her employer Steelcase, alleging she suffered neck and back injuries after falling from an office chair. As part of its defense, Steelcase issued a subpoena to Facebook and MySpace, seeking public and private portions of Romano's profile

Facebook objected to the request on the basis that private messaging was protected under the SCA. But the court disagreed, finding that sharing personal information with others “is the very nature and purpose” of social networking sites, and by joining, Romano consented to the possibility that her personal information would be shared with others.

But not all courts have agreed. In a similar case, a California district judge ruled in May that private Facebook and other social network messages are protected information under the SCA.

Jennifer Hamilton, senior attorney of Deere & Co., stressed that companies must spell out policies for how employees should be using social media when representing the company.

Cloud Computing

Another e-discovery trend that legal experts believe will come to the forefront in 2011 is the growing popularity of “cloud” software and data storage, where applications are run and data is stored online rather than on a company's own equipment. “It is becoming a mainstream delivery model,” Burney said.

Legal departments still struggle to find the proper comfort level for cloud computing. “We're lawyers,” Burney said. “We're taught to be skeptical of most things, especially when they're new, and they're not completely tested.”  

“We're lawyers. We're taught to be skeptical of most things, especially when they're new, and they're not completely tested.”

—Brett Burney,

Founder,

Burney Consultants

Cloud computing raises some ethical dilemmas for attorneys on the handling of privileged information. Burney cited Rule 1.6 of the American Bar Association's Model Rules of Professional Conduct as an example.

That rule states: “When transmitting a communication that includes information relating to the representation of a client, the lawyer must take reasonable precautions to prevent the information from coming into the hands of unintended recipients. This duty, however, does not require that the lawyer use special security measures if the method of communication affords a reasonable expectation of privacy.”

Following that rule can be difficult with these new technologies. “None of us really have any control over where our e-mails bounce around over the Internet,” Burney said—but at the same time, Rule 1.6 still holds, regardless of the technology. “The same duty applies,” he said.

Several states are addressing the issue now and developing new ethical and technical standards every day. Courts in Nevada and New York, for instance, have ruled that lawyers can store confidential client information on external data storage systems without client consent, as long as they exercise reasonable care that confidentiality is maintained.

New York and Arizona case law goes further, ruling that lawyers there have an obligation to stay aware of technology advancements, to assure that whatever systems they use still have minimal risk exposure.

 “I fully believe that, as legal professionals come on board and become more comfortable with this idea, we will start to see this as an absolutely secure and confidential method for delivering information over the cloud,” Burney said.

Legal, IT Coordination

E-DISCOVERY & CIVIL ACTIONS

Below are two charts from Fulbright & Jaworski's 2010 Litigation Trends Survey.

Respondents to the litigation trends survey where asked if the U.S. Rules of Civil Procedure should be modified to limit e-discovery in civil actions:

Source: Fulbright & Jaworski.

Legal experts also expect the division between IT and legal departments to narrow in coming years. E-discovery touches all aspects of the business, making a team approach to electronic discovery and information management particularly important, Losey said.

IT departments look at information management strictly as an IT responsibility, “and a lot of times, frankly, they're aggravated that the lawyers have to even get involved in some of those responsibilities,” Burney said. It's important to look at the matter from both an IT and legal perspective, however, “if for nothing else, to better understand where the two departments are going to clash heads, or where they can come to some agreement,” he said.

Losey said the legal department should inform policies governing information that could become part of e-discovery. How long must employees save their emails? Do the senior executives of the company need to keep their emails longer than lower-level employees? Should automatic deletion procedures be put in place? Those are the kinds of questions the information management and e-discovery team must answer when working together, Losey added.

In-house counsel must also collaborate with outside counsel (not always an easy task) for the sake of gaining greater visibility into the organization. If only outside counsel is left in charge, in-house counsel won't be aware of the all the legal costs and processes that are involved, Hamilton said.

By working together, in-house and outside counsel can develop a litigation strategy aligned with corporate objectives not just to keep costs down, but also to establish appropriate timeframes and litigation strategies to win the case.

One way this can be achieved is to create as much transparency as possible, Hamilton said. In-house can explain to outside counsel: “‘Here's how things generally work. Let's figure out what this case requires, what additional information you need,'” she said.