I remember attending a four-hour “corporate sensitivity” training session at a previous company back in 2005.  The entire company dreaded the session, which was intended to make us aware of how we should (and should not) behave, as they viewed it as wasting four hours telling them things they should already know…be sensitive to others, no pornography, respect those of another gender/religion/race/body type, no flame email messages, etc.   Not surprisingly, the session was led by an attorney well-versed in labor law who did a very good job of telling everyone how badly things could turn out if they behaved inappropriately.  He seemed to spend a disproportionate amount of time focused on email, explaining how misguided email messages could sink not only our company but our careers.  His parting admonishment, which I thought was so compelling that I have repeated it at countless eDiscovery events, was as follows: assume every email you write could end up on the front page of the Wall Street Journal or New York Times.

To those who have litigated in the past ten years or have supported such litigation, the fact that email is the most common form of evidence is so commonplace as to be cliché.  The reasons are fairly simple: authentication of email is straightforward in most cases, absent fraud it is clear who “said” what, to whom and when, and the written word is capable of multiple interpretations – especially cryptic messages, like Twitter…but don’t get me started on that.  And email has the wonderful ability to make a witness testify against themselves (“So Mr. Smith, are you really trying to convince us that this message sent by you on December 10th at 4 PM does not actually say what we are all looking at on the screen in front of us?!”).

So it was with no small amount of irony that the first story I saw in today’s Wall Street Journal – “Emails Show Fed’s AIG Angst”, under a picture of Treasury Secretary Timothy Geithner – focused on an alleged effort by the New York Fed to hide particularly unsavory details about the Fed’s bailout of AIG last year.  Not to be outdone, Corporate Counsel magazine wrote an article on the same topic yesterday which was picked up by ALM (“E-Mails Show New York Fed Lawyers' Push to Hide AIG Details”).  But while the power of email evidence remains the same, the behavior – especially of people ostensibly leading our economy who should know better – may be the most surprising element of the story.  Tim Geithner is about as sophisticated and educated as one can get, and even he fell victim to the quicksand that is email.

Back in 2005, we thought everyone knew email was something to be used carefully and with scrutiny…yet here we are five years later watching one of our most important financial leaders being forced to explain why he allegedly tried to hide something, tripped up by his own hand.  I guess the more things change the more they stay the same.

Not wanting to be left out of the “predictions party” that always seems to take place every December – yet trying to be at least a little bit different – we thought we’d wait until the first week of 2010 to try on our predictions for the year.  And rather than making outlandish predictions about what will/won’t happen in this year of recovery, we felt it more appropriate to focus on several key trends we see dominating the information and risk management spaces…which include at least to some degree eDiscovery, enterprise search/KM, records management, GRC (Governance, Risk, Compliance) and email archiving.

Out with the old, in with the new - automated eDiscovery goes mainstream

Despite all the technology involved in eDiscovery, the process has always included a critical – and costly – human element: linear review. In a typical case, roughly 70% of the cost is generated by the tedious, error-prone and stupendously inefficient phase of “document review,” which involves platoons of contract attorneys reviewing and tagging individual documents one at a time -- and billing an average of $75-$100 per hour to do it, but in some cases as high as $300 per hour.  This legacy, paper-based process being used in a digital world is known as “linear” review…and is about to become obsolete.

In late 2009, several trends converged to bring about a sea change in eDiscovery:

• Predictive Coding™ technology is now accurate enough to take the place of contract reviewers – with superior results
• The technology is now fully defensible thanks to random sampling of the automated output
• Judges have demonstrated that they consider automated review acceptable, and in many cases perhaps event preferable, giving corporations and law firms the confidence to use the technology on a day-to-day basis

Now that the obstacles to automated eDiscovery have disappeared, the financial argument becomes irresistible. Some of the world’s largest law firms are saving millions of dollars per case through automated review, and the rest are sure to follow. Starting in 2010, automated review will steadily replace the linear model, which will soon seem as outdated as typing pools and punch-card data entry.

Corporations will flock to the novel notion that ECA technology must assess a case “early”   

The most important word in “early case assessment” (ECA) has always been the first one. But ironically, “early” is what most ECA tools fail to deliver.

ECA technology and vendors promise to  quickly and accurately determine eDiscovery risks before litigation gets underway; counsel can then formulate a litigation budget and decide whether the potential benefits of a proceeding outweigh the likely risk and costs of discovery. The strategy only works, however, if ECA happens at an early stage. Too often it doesn’t. Most early case assessment tools are incapable of assessing anything until ESI has been 1) identified by the legal department, 2) preserved by internal staff, 3) collected by internal staff and/or outside consultants, 4) sent to a third party to be processed before 5) being ingested again into an ECA or review tool. Typically, this takes weeks, if not months, after an event begins, negating the advantage ECA is supposed to deliver.  And vendors have for the most part exacerbated this phenomenon as they, in essence, offer culling tools masquerading as ECA tools.

Nevertheless, the benefits of ECA are real, if it takes place from an event’s outset – at or before preservation and collection and long before ingestion, culling and processing. Recognizing this, companies will increasingly look for specialized ECA technology that can assess cases from the outset of an eDiscovery or regulatory event, allowing them to formulate strategy before they spend millions of dollars on collection, processing and review.       

IT will look for ways to go beyond “spring cleaning” with content

The problem of uncontrolled and disorganized content growth will continue to command attention thanks to  1) mounting storage costs from file shares, email archives, and even tape, 2) seemingly insurmountable records management issues, 3) stringent regulatory response requirements, and/or 4) continuously growing eDiscovery risks and costs. 2010 will be the year when the costs and risks posed by information start outweighing the tendency to “keep everything”, leading to an evolving IT mindset with respect to content.  As with ECA, we will see a trend toward using automated categorization and other analytics proactively, earlier in the information lifecycle – in this case, regularly culling data the company has no reason or obligation to store.  As part of this conversation (perhaps even the focal point), many will start to realize that email can and should be organized…for all of the aforementioned reasons plus far greater employee productivity.  In fact, this conversation has already begun…

Advanced eDiscovery technology will improve large law firms’ business models

With ongoing sluggishness in the economy, law firms, consulting firms and litigation support providers are under tremendous pressure to demonstrate value, and deliver lower, more predictable costs (for instance, through Alternative Fee Arrangements such as fixed-cost contracts). This pressure may well represent a “new normal” that will persist even after the economy recovers. Yet firms are reluctant to do anything that will reduce their profitability (aka annual partner bonuses). Advanced technology will allow them to have their cake and eat it too. With automated eDiscovery, for example, these firms can reduce their own eDiscovery costs by 50-80%, in turn allowing them to pass on some/most/all of these savings to clients.  This in turn allows them to become far more aggressive in pitching new business in the form of lower rates or fixed-fee arrangements.  The billable hour may not be dead or even dying, but it is certainly under attack.

In the ramp-up to recovery, enterprises will rediscover expertise location

Leery of hiring during a slow recovery, corporations always want to extract more productivity from the employees they already have. This time around, many will turn to expertise location software to make their organizations much “flatter” and more efficient. With  experts on any topic only a mouse-click away, employees can quickly come up to speed on unfamiliar topics—something that will also help companies hire quickly when the upturn finally arrives.