E-discovery: 4 tips on cost effectively responding to a litigation hold

Lessen the financial burden imposed on your company while avoiding monetary and other court imposed sanctions

In today’s modern economy, corporations are faced with many challenging new issues, not the least of which is minding their bits and bytes. Most of us, if not all, by now, have been confronted with a litigation hold and the challenges they can generate. But in case you are just awakening from a Rip Van Winkle-like nap, a litigation hold is a written notice advising corporations and custodians of electronically stored information (ESI) to preserve potentially relevant records and information that pertain to pending or anticipated litigation.

So with that refresher, the important question is: How do you cost effectively respond to a litigation hold? After all, litigation, especially electronic discovery in hotly contested litigation, can become quite expensive. As in-house counsel, you are responsible to effectively manage these costs and the company’s exposure. Below are a few tips to help you in this regard and at the same time assist in preserving the company’s bottom line:

4. Involve Others. Receipt of a litigation hold is, at a minimum, an obligation to preserve documents, and more likely, is notice of an impending lawsuit. Accordingly, you should immediately advise your liability insurer of possible litigation to avoid notice issues. Furthermore, inform your legal counsel, as he or she can help you frame the scope of potentially relevant information, respond to the party that sent the litigation hold, and assist you in documenting the steps you need to take to preserve relevant ESI. Finally, if your company is small or you do not have an IT professional who can be responsible for litigation holds, consider hiring a qualified ESI consultant. While the upfront cost of ESI consultants sometimes deters small companies from being proactive when faced with a litigation hold, such consulting costs have proven to represent a fraction of those costs and penalties that await the company that fails to take the necessary steps to comply with a litigation hold.

In sum, be proactive, not only in responding to a litigation hold, but in your day-to-day operations. When you are not subject to a litigation hold, review and update your company’s document retention policy, be efficient in your records retention practices, ensure your company’s policies and procedures are routinely followed, and have a plan to handle litigation holds, including designating a team to be responsible for litigation holds.

Contributing Author

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William T. Eveland

William T. “Toby” Eveland is a partner at Arnstein & Lehr LLP’s Chicago office. His practice focuses on business and class action litigation, premises and...

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Contributing Author

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Christopher S. Naveja

Christopher S. Naveja is a partner at Arnstein & Lehr, LLP’s Chicago office, is the Co-Chair of the firm’s Consumer Finance Litigation Practice Group, and...

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