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Articles in this Series Disclosure for litigation or regulator
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Disclosure, Litigation Readiness and Document RetentionThe Pyramid of PreparednessÅ This is one of a series of five linked articles on this subject Æ 3. Litigation ReadinessOne step back from actual Disclosure in a real case, is "litigation readiness" – the state of being prepared for all litigation or regulatory inquiries which are reasonably foreseeable. This is a mixture between a project and a set of procedures. As a project, its scale will depend (obviously) on the number of documents and document sources you have, but also on whether you have behind it a document retention policy. If you have no document retention policy, then litigation readiness involves getting prepared for any likely or possible litigation by making sure (at the simplest level) that all relevant documents are kept where they can be found and retrieved. What is relevant? This is not necessarily as straightforward as may appear, even at the simplest level. What is going to be "relevant"? The word "relevant" no longer appears as part of the primary English definition of a disclosable document for standard Disclosure. Rule 31.6 of the CPR refers to documents which a party relies on, which adversely affect his case, or which adversely affect or support another party's case. The scope may be widened by an order for specific Disclosure which, in practice, means that any class of documents may be deemed disclosable if your opponent can persuade the court (or the court decides for itself) that the interests of justice and proportionality require that they be produced. That takes us towards the US model, where the scope of Discovery becomes a battle-ground of competing claims as to the materiality of documents, sometimes dwarfing the primary subject-matter of the claim. There are guidelines and precedents to follow, and arguments as to accessibility and the cost of production relative to their likely evidential value, quite apart from the particular facts of the case. The key difference between the English and the US rules lies in the potential scope of the demand for the identification of potential document sources. Whilst an English order for specific disclosure may take you beyond the tight definition of Standard Disclosure, the courts will still want to be satisfied as to the relevance of the demanded sources and will discourage "fishing". The US rules, however, do the opposite, and in express terms. Rule 26(5)(b)(1) says that "Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.". You may like to measure your knowledge of your own document sources against that standard, and in a hurry. At least know what you have got and where Where does this leave a company trying to slim its document collection down to those which might have to be produced in as-yet unthreatened litigation? The prudent course, one might think, is to keep everything, and limit the scope of a litigation readiness exercise to simply identifying all the data silos. That at least limits the scope for a claim for spoliation – the accusation that documents were destroyed to prevent their exposure in forthcoming litigation. That is to misunderstand the nature of a spoliation claim and, indeed, the concept of forthcoming litigation. I will deal with both at more length elsewhere, but neither should be a bar to a prudent cull of documents as part of a litigation readiness programme. The key to any such cull is that it should be documented and defensible in the context both of the business and the likelihood of litigation. A scale of materiality Think of a "scale of materiality" which has, at one end, a contract for the supply of radio-active material and the testing data which preceded it and, at the other, an e-mail from Joe to Fred suggesting a drink after work. There is little difficulty, on the face of it, in deciding that the first must be kept, probably for ever, and that the last is unlikely ever to be required by anybody for any purpose (unless, of course, Fred works for a competitor and the mere fact that Joe is in touch with him raises questions). In between these black and white positions are innumerable shades of grey. The problem is not really in deciding whether any one document is to be kept or destroyed, but in the fact that you have 1.3 million of them in multiple forms and containers. You also have a cupboard full of back-up tapes in which overlapping incremental backups include material of all kinds. Furthermore, the collection includes some personal data and covered by tight EU regulations, some which may be privileged, parts which you would prefer to keep out of the hands of certain US Federal Agencies, and some with longer limitation periods than others. Lastly, the fear of litigation or of the regulator's knock are not the only factors – there may be ordinary business purposes which justify the survival, and the accessibility, of certain kinds of documents. Need I say more? I have said enough. I think, to illustrate the mountain which may have to be climbed. Before you knock the subject off the agenda and into the long grass, however, consider two things: firstly, if this is a problem when you are able to take a long view, how much more of a problem will it be when litigation appears out of the blue? Secondly, if only 10% of your document population gets knocked out at this round, that is 10% fewer documents for the lawyers to pore over at x hundred pounds per hour. It is worth repeating two things said above. The first is that if the subject is ignored or deferred, it must be done advisedly, after considering the costs and the risks, with such advice from lawyers and consultants as is needed to form a proper view. The second is that the exercise must be documented and defensible – spoliation claims are rarely pursued if a party can show a reasoned business case for document destruction which took account of all relevant factors, including the likelihood of the litigation, and which was followed.
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