Why Is eDiscovery Important? Understanding the Significance

In legal proceedings, the discovery process provides the opportunity for parties to obtain data to support a case, such as employee testimony or product records. Now that so many businesses store records in digital format, law firms around the country are encouraging clients to implement eDiscovery procedures. With eDiscovery, the potential evidence available includes electronically stored information: emails, PDF files and other communications.

Why is eDiscovery important for modern industries?

Table of Contents

• Why Is eDiscovery Important in Legal Fields?
  • The eDiscovery Process
  • The Important of eDiscovery for Lawsuits and Settlements
• Why Is eDiscovery Important to a Company?
• Why Is eDiscovery Important Where Technological Advanced Are Concerned?
• Why Is eDiscovery Important for Modern Industries?

Why Is eDiscovery Important in Legal Fields?

Lawsuits are won or lost — or settled — based on the strength of the evidence legal teams present. In the past, cases often hinged on finding a cooperative witness or combing through company records in search of key data. Keeping copies of contracts was vital to show when the other party had breached an agreement.

These days, the “smoking gun” often comes from documents in electronic formats:

• Email communications
• Text messages or chats on internal messaging systems
• Digital agreements with e-Signatures
• CAD blueprints or proposals
• Images and videos
• Databases

The right document or email can heavily sway the outcome of a trial. It’s essential for large organizations, like yours, to implement email archiving to help with this process.

The eDiscovery Process

To understand why eDiscovery is important, first it’s necessary to know how it works. The process follows nine steps collectively known as the Electronic Discovery Reference Model:

1. Information governance: Putting into practice the procedures and policies that determine how communications and data are handled and stored
2. Identification: Determining which data is most likely to be relevant to the case and where it is stored
3. Preservation: Securing the data so it remains intact and unchanged in preparation for legal needs
4. Collection: Tasking forensic examiners to gather and preserve the requested data from all selected sources
5. Processing: Removing duplicate data and converting stored information to compatible formats for reviewing
6. Review: Checking the selected data to ensure relevance to the legal proceedings and identify other valuable information
7. Analysis: Reviewing the remaining data more thoroughly in search of key individuals, topics or patterns that may further strengthen the case
8. Production: Converting data to readily usable electronic formats and sharing the information with the opposition as required by law
9. Presentation: Displaying the key data at trial or presenting the evidence to regulators

The EDRM framework provides a good structure for legal organizations getting started with eDiscovery.

We’ve written more about this process, here.

The Importance of eDiscovery for Lawsuits and Settlements

It may be possible to show liability or gross negligence using the other party’s own words from text messages to co-workers. Electronic documents have metadata, which identifies exactly which user sent the message, who received it, and when and where the exchange happened. Used correctly, relevant data can make witness testimony even stronger or put key arguments in clear focus. Strong corroborating evidence can provide significant leverage in arbitration, negotiations and settlements.

Why Is eDiscovery Important to a Company?

Investing in eDiscovery isn’t a luxury for corporations; it’s an essential technology for protecting a company’s financial interests, public and professional reputation, and ongoing business operations. There are several good reasons why eDiscovery is important in today’s quickly evolving digital landscape.

Data Technology Provides Benefits for Modern Businesses

High-tech software delivers tangible benefits for large businesses:

• Simplifying data preservation: Sift through a huge volume of records in record time, disposing of unnecessary records and saving important data.
• Increasing work efficiency and productivity: Follow scalable, repeatable data storage procedures instead of getting tied down in confusing red tape.
• Streamlining regulatory compliance: Ensure personnel comply with government regulations by implementing a technology solution.
• Supporting internal investigations: Locate emails, chats and other evidence for HR investigations and safeguarding trade secrets.
• Revealing opportunities for improvements: Use eDiscovery software to look for trends in customer service responses, organizational communications and other aspects of business operations.

Company Data Is a Valuable Asset That Needs Protecting

Even where businesses aren’t legally required to save data, deleting information isn’t a smart move, at least, not before analyzing it. Hidden in the huge wealth of emails, reports, studies, tests and other electronic documents is proprietary data that is exceptionally valuable. Trade secrets don’t just involve new technology; they also include specific ways of doing things that enhance the organization’s productivity, customer satisfaction, profitability and growth.

Why is eDiscovery important for data storage? It helps businesses identify which data needs preserving and where. Some information should be kept exceptionally secure against intrusions, with limited personnel having access.

Some Businesses Are Required by Law To Preserve Communications

The laws regarding communications records are strict in the case of financial businesses, including lenders and investors. Publicly traded companies may also need to follow careful regulations by the SEC and other bodies.

Following incorrect procedures by accident isn’t an excuse. In 2021, JPMorgan Securities had to pay fines worth $200 million to several government agencies because employees had been using personal smartphone apps to carry out sensitive company business. Without clear eDiscovery policies in place, it’s all too easy for employees and managers to run afoul of regulatory guidelines.

Regulations and requirements for large organizations vary a lot. We’ve written more about that here.

Any Business Can Face Lawsuits

Businesses around the world are no strangers to litigation. According to a survey in 2017, over 75% of businesses experience at least one lawsuit a year, and nearly 50% face between six and 20 lawsuits annually. Approximately one in four businesses have to deal with more than 20 legal proceedings each year.

Some of these lawsuits come from competitors trying to get in the way of market dominance. Anti-trust cases often involve troves of communications. Other potential lawsuits come from end consumers, clients, disgruntled employees or suppliers.

Why Is eDiscovery Important Where Technological Advances Are Concerned?

The role of eDiscovery software in data preservation, legal proceedings and business management isn’t going to shrink: If anything, this technology will only get more important as time goes on. In 2020, businesses and individuals created more than 64 billion terabytes of data, and this number increases significantly every year.

With such a high volume of electronic content, analyzing records manually simply isn’t an option. Even employees don’t have time to read through all the messages they receive in their inboxes. Legal teams and organizational reviewers don’t have the manpower or the budget to sift through all of the phone calls, texts, videos, chats and operating data accumulated over months and years.

Fortunately, artificial intelligence can lend a hand. AI advances make it possible to narrow down the scope of data linked to eDiscovery. That way, human professionals only have to sift through the most important items.

Why Is eDiscovery Important for Modern Industries?

The growing volume of business data can be an important tool for modern industries in legal matters and company operations. Why is eDiscovery important for navigating this mountain of information? AI-driven software solutions can lower review costs and make high-value evidence stand out. At Cloudficient, we use this next-gen tech to implement enterprise data migration that follows legal hold requirements. Learn how our compliance migration services support eDiscovery.