First published by Inside Legal Thought Leaders Digest (TM), College of Law Practice Management Issue, released in connection with COLPM’s Futures Conference, Oct 2011
I have been doing e-discovery, nee litigation support, since 1989. In the last few years, I have seen the legal market diverging into two new worlds of electronic data and discovery (EDD). How does each look and what does it mean for its inhabitants?
Ignorance and Denial World
Many lawyers and law firms seem unfamiliar with e-discovery. I wish I could say “uncomfortable” but discomfort suggests a degree of familiarity that in this instance is absent.
I regularly talk to EDD professionals, who report stories of lawyers who are shockingly unaware both of the legal rules and practical issues of EDD. At conferences, the handful of judges known for their grasp of and decisions on EDD say many litigants (and judges) are clueless about EDD. For example, in October, I attended the Masters Conference, an EDD event. In the session More on E-Discovery Certification, the panelists bemoaned how many lawyers and other legal professionals lack even basic EDD know-how.
I offer two hypotheses to explain this world. One is ignorance. It’s hard imagining, however, a lawyer missing the hundreds if not thousands of articles, conferences, and advertisements about EDD over the last half-dozen years. Even general legal publications and mainstream media cover it. If, in fact, more than a few lawyers have missed all this, perhaps we as a profession have an even bigger problem to fix
Another possibility is denial. Some lawyers seem to think digital data is unimportant or that the rules of civil procedure regarding EDD somehow do not apply to them. The willing suspension of disbelief is fine when enjoying a movie, but not for professional pursuits.
Inhabitants of these worlds take a big risk, namely judicial sanctions and malpractice. And let’s not forget ethics: Model Rule 1.1 requires competent representation. Failure to at least consider the role of EDD in a contentious matter arguably violates the rule.
Education is the cure. It is readily and widely available. Now, persuading this world’s inhabitants that they need it… well, that goes beyond my expertise.
The Real World
Fortunately, many lawyers and law firms live in the real world where they know about and regularly engage in EDD. However, inhabitants may not yet have noticed that after a period of rapid evolution, their world is entering a new, slower phase.
EDD became a big deal around 2002 or 2003. I characterize its early days as the Wild West. Technology debates loomed large, for example: file formats (TIFF, PDF, or native); review systems (hosted or in-house); and productions (include metadata or not). Litigators and commentators alike hung on every word of the few judicial decisions. The Federal Rules were up for review and were amended in 2006. Vendors came – and they came and they came, from copy shops, Silicon Valley, and points in between. Smart law firms saw opportunity and built document review empires, generating huge profits, while others put their heads in the sand and ignored EDD. Corporate law departments struggled with information governance and retention policies.
Two events in October caused me to realize that this world has vastly slowed down. EDD today has matured; it has become a business battle. Of course, not every debate is resolved, but the areas of contention have narrowed considerably.
First, when I was at the Masters Conference, I had many private conversations with EDD experts, some leaders in the field. They confirmed my sense that the market is maturing and consolidating, even if it is still growing. The action today seems more in the realm of marketing than of solving fundamental problems. The Wild West has been tamed. Now, it’s a matter of case law development and convergence on a few technologies and processes.
And second, days after the conference, thumbing through the October issue of Corporate Counsel magazine, I stumbled on a two-page ad spread for WilmerHale’s Discovery Solutions offering, at <a href=”http://bit.ly/nAfR8N”>www.wilmerhalediscoverysolutions.com</a>. This site describes in some detail, including pricing, the firm’s approach to e-discovery and document review. The reference to the firm’s low-cost (relative to Washington, New York, or Boston) Dayton service center is via a listing of lawyers in Dayton. The site is substantively impressive; more importantly, it reflects that marketing and positioning have become primary.
WilmerHale competes for e-discovery and document review with other large firms and vendors. Case in point, an “unaided recall” list (ones I happen to remember) of firms with dedicated e-discovery practices includes:
- King & Spalding
- Morgan Lewis
- LeClair Ryan
- Hughes Hubbard
- Ryley Carlock & Applewhite
Yet law firms have no lock on this business. In fact, in the Wild West days, the vendors dominated. I first started seeing a change in 2007: my blog post Coming E-Discovery Battle between Vendors and Firms noted the emergence of law firms with their own EDD capabilities. I even encouraged this trend with my white paper that year called 4 Ways an eDiscovery Attorney Can Make Your Firm More Successful, suggesting that law firms consider hiring lawyers specializing in EDD.
Law firms listened. They built EDD capabilities. Yet they still compete, first, with growing corporate law department EDD capabilities and second, with a still-long list of vendors. So as I see the EDD market, the real action is no longer fundamentals, but a battle for market share based on pricing and feature mixes.
One of my recent Twitter exchanges helps makes the point. I asked re WilmerHale “Do other firms have dedicated #eDiscovery sites?,” to which leading UK EDD expert Chris Dale responded “any firm not doing something similar within 2 years is dead for #ediscovery work.” I think Chris is right.
Any firm that litigates will need not just understand e-discovery, but have the capability to do it. Owning is one option, outsourcing another. Either way, firms will have to position themselves as having expertise and capabilities.
Many lawyers are “outstanding”. Clients take that for granted. They also take for granted decent technology and process. So law firms need to persuade ever-more-sophisticated clients that the firm can do the EDD work cost effectively. Go ahead, tweak your process, tune your technology, but make sure you have the right business strategy and marketing.
As EDD capabilities grow and converge toward standards, competitive differentiation is increasingly hard. Price, service, and marketing become the keys to winning. Okay, I am forward thinking. We may not be quite there yet but, to paraphrase Churchill, we are way past the end of the beginning.