Gregory P. Bufithis, Esq.  Founder/CEO

20 April 2012 – “When you are up to your arse in alligators, it is difficult to remember that your initial objective was to simply drain the swamp.”  Or so goes a very old saying from the Mississippi Delta region in the U.S.  Ah, yes.  Unintended consequences.  Much on the mind of the IMF, and the global banking community.  In its Global Financial Stability Report (GSFR), published on Wednesday, the IMF warned that European banks looked set to shrink their balance sheets by $2.6tn (€2tn) and that unless officials improved their policy response, the IMF said, European banks would dump almost 7 per cent of their assets by the end of next year. 

And call me a glutton for punishment, but I actually enjoy reading the GSFR.  It is the economist still lurking within, after all those years on Wall Street as a currency trader before law school.  I even read all the “Tables” and the “Graphs” in the GSFR.  But honestly, the content is great.  The section on “Indebtedness and Leverage in Selected Advanced Economies” is best.  Global Economic 101. 

There is nothing in this that the IMF has not, in general terms, said before. What’s new is the comrehensive scale of the assessment of European banks’ deleveraging and the risks it poses, including in emerging Europe.  A drastic contraction of European bank balance sheets during the next 18 months could jeopardise financial stability and economic growth in Europe and beyond, according to the IMF.  

And it is all due to the IMF and global banking regulators who wanted the continent’s 58 largest banks to boost their capital ratios, suggesting they shed unprofitable businesses and cut their reliance on wholesale funding.  But now the IMF says “the deleveraging process would be more severe than previously anticipated”.  Oh, dear.    While acknowledging that balance sheets needed to shrink after the financial excess seen in the run-up to the crisis, the IMF warned that the risk of a “synchronised and large-scale deleveraging” could spark financial instability and hit economic growth.  The fund now thnks that better policies — such as a consideration of more easing by the European Central Bank and further structural reforms, as well as progress on bank restructuring and resolution — would prompt a smaller contraction in banks’ balance sheets, which would boost euro-area growth by 0.6 per cent by their estimation. 

And there are assets … and then there are assets.   Elsewhere in the report, the IMF warns of the risks presented by an ever-decreasing stock of “safe” assets. “The number of sovereigns whose debt is considered safe is declining – taking potentially $9tn in safe assets out of the market by 2016, which is roughly 16 per cent of the projected total.” It expects this trend to inflate prices for the few remaining assets deemed to be safe.

But this deleveraging also helps to explain the spike in due diligence reviews, M&A reviews and regulatory reviews across Europe (and the U.S.) that have teams of temporary attorneys employed to assist in the process.  There are no less than 10 such reviews now in progress across Europe alone. 

The regulatory component is significant.  Call it globalization in reverse.  There is already a dramatic deglobalisation going on. In the past few weeks, Goldman Sachs has sold down its stake in Industrial & Commercial Bank of China, HSBC has started trying to sell operations in Pakistan and South Korea, Citi has sold stakes in banks in India and China, and is looking to sell a stake in Turkey.

Which is all due to the other side of the coin, the regulatory bit.  Part of the impetus for some of these are new rules at the international Basel committee that are punitive for banks holding stakes in other banks. The regulation is global – the impact is that groups become more national.

And so the new ugly word in modern banking:  “subsidiarisation”.  Which is organizing global banks into separate national operations. 

Which actually may lead to MORE work for attorneys.  As Citigroup said in a disclosure in its annual report: “We could be required to create new subsidiaries instead of branches in foreign jurisdictions … which would, among other things, increase Citi’s legal, regulatory and managerial costs, negatively impact Citi’s global capital and liquidity management and potentially impede its global strategy.”

This comes from the difficulty of agreeing rules for winding down a cross-border megabank. If the UK and Iceland can come to blows over Kaupthing and Landsbanki, what happens if a really big bank needs to be resolved? Many officials think more national organization and ringfencing are inevitable.

Taken to the extreme this could be an existential crisis for banks such as Citi and HSBC, who see themselves as more global than national. It is also bad news for other widely spread banks such as Barclays and Deutsche Bank, whose management will find life less exhilarating if they have to spend less time globetrotting and more time thinking about branches in Dagenham or Düsseldorf.

And other issues creep in.   The U.S. is planning to prohibit proprietary trading at its banks and capping their exposure to single counterparties.  Well, apart that is, from US government debt – load up on that, boys: we have a deficit to fund! 

Why is deleveraging across the Eurozone so hard, so challenging?  Good questions.  Thanks for asking.  In a nutshell (well, a series of bullet points):

1. The continued volatility in euro area financial markets has kept the spotlight on sovereign debt burdens.  In many countries, however, high public debt is but one aspect of strained balance sheets in the broader economy. Across the euro area, these strains can be traced to a convergence process that induced many private and public borrowers to ramp up debt during the first decade of the monetary union. Unprecedented low interest rates and ample credit supply, including from foreign lenders, fueled lending booms often centered on real estate.

2.  And so rising asset prices flattered net asset positions, boosted economic performance, and concealed an erosion of competitiveness, allowing households, firms, and sovereigns to borrow and spend freely until … bang, the tide turned.

3.  And let’s not be fooled.  Credit-fueled booms were not limited to the euro area. Rather, lax lending standards and the secular fall in real interest rates caused sharp increases in household debt in several other countries, notably the United Kingdom and United States. When the credit cycle went into reverse, economies were left with severe threats to financial stability: borrower net worth declined and cash flows shrank, inflicting large losses on lenders that were themselves overleveraged and reliant on fragile funding structures.

4.  Although the most acute phase of the crisis may have passed (we hope), high debt burdens persist as a dangerous chronic condition. To be sure, countries differ significantly in their individual debt problems.  Ireland and Spain are examples of a private debt overhang weighing down the sovereign, whereas in Italy and Japan high public debt is balanced by strong household balance sheets.  Weak external positions further compound the challenges facing Greece, Ireland, Portugal, and Spain. 

5.  Aggregate data inevitably convey only a partial sense of financial vulnerabilities in the crosssection of households or companies. There also are no firm general limits on how much debt any given sector or entity can sustain. Indeed, when you look at the numbers provided by the IMF stats (“Figures” and “Tables” galore!) you see high household debt levels in several countries that have not suffered a crisis, such as Australia and Norway. Nonetheless, highly indebted agents face a continuous risk of reaching hard credit constraints that leave no choice butto reduce debt. In other cases, stretched borrowers will resolve to deleverage even before they are forced to do so by market pressures.

6.  This deleveraging process offers a path to healthier financial positions over the medium term but poses significant challenges during the transition.  Two points:

7.  First, deleveraging in the household or government sector weighs on growth insofar as it entails an extended period of spending below revenue levels.  During this period, overall growth must be underpinned by stronger spending in other sectors. Yet, a smooth “handover” is difficult when several domestic sectors are under strain simultaneously.  Foreign demand also may not provide an immediate offset, as external rebalancing often requires improvements in competitiveness that take time. Moreover, many large economies are currently weighed down by high debt, leaving few sources of robust external demand.

8.  Second, simultaneous belt tightening across sectors may reinforce financial vulnerabilities. Recessionary tendencies generate asset quality problems, which may worsen financial sector health and lead to further tightening of credit conditions. Meanwhile, weak income growth and real depreciation of the exchange rate, both of which are necessary to restore competitiveness, also increase the real debt burden.  In the worst case, downward price dynamics might become entrenched, tipping the economy into debt deflation … which historical experience suggests is likely to be a drawn-out process.  The experience from three historical deleveraging episodes in advanced economies — Finland, Japan,and Sweden — underscores the drawn-out nature of debt cycles.  In each case, household debt as a share of GDP took between 6 and 10 years to reach a bottom that was 10 to 35 percent below peak levels. GDP growth during the intervening years tended to be weak.

And therein lies today lesson in finance and economics.

19 April 2012 -  We are almost half-way through and 2012 is shaping up to be a very significant year for eDiscovery in the UK and Europe.  We have the new requirements under Practice Direction 31B, formal cost management in litigation, the new EU Data Privacy Directive and new streams of evidence through social media – all coupled with unprecedented economic pressures, data proliferation and an ever increasing number of regulatory investigations in a heightened risk management environment.  So, as the eDiscovery and eDisclosure pundits have been saying:  it’s time to ensure you have airtight information governance and eDiscovery/eDisclosure strategy in place that protects your organization’s immediate and future legal, regulatory and operational requirements.

What better way then to attend Legal IQ’s 7^th Annual Information Governance & eDisclosure Summit and Exhibition which is the UK’ largest and most comprehensive eDiscovery show.  To get an idea of the comprehensive nature of this event just check out the full program which you can access by clicking here. 

The event is next month and the details as follows:

7th Annual Information Governance & eDisclosure Summit and Exhibition
14 -16 May, 2012
Millennium Gloucester Hotel & Conference Centre, London, UK
Website: www.informationretention.co.uk
Email: enquire@iqpc.co.uk
Tel: +44 (0) 207 036 1300

And we are offering a special discount to our members, the details further below in this post.

The conference brings together over 35 international speakers including judges, regulators and top-level industry experts that will give you the information that you need to:

• Use the latest project and cost management techniques to hold eDisclosure to standards of cost-efficiency like any critical business process
• Leverage technology to gain control of the eDisclosure process
• Identify the practical implications of US and European regulatory enforcement activities
• Deal with increased judicial management and the role of technology in the dispute resolution process
• Improve information management to support your organisation’s immediate and future regulatory, legal, risk and operational requirements 

Hear from Legal, IT and Document and Records Management experts as they tackle current litigation trends, regulatory challenges and the imposed constraints eDiscovery teams are facing.

In addition, join us at the Information Governance & eDisclosure Exhibition to enjoy a series of keynote presentations with industry experts ranging from key eDiscovery technology experts to Q&As with our international panel of judges and regulators.

All Project Counsel members are invited to get a special VIP Conference Pass* at only £149 +VAT which you can apply today by simply going to the website  www.informationretention.co.uk/projectcounsel-register.  When you register please quote ProjectCounsel.

In addition, if you just want to see/meet with all the eDiscovery vendors that will be there you can obtain a Exhibition Visitor Pass** which is free and all you need to do is simply register online at a special web site: www.informationretention.co.uk/projectcounselpasses. 

To access complimentary and regularly updated Articles, Speaker Interviews, Videos and Presentations, etc. visit the Information Governance & eDisclosure Download Centre for complimentary and regularly updated Articles, Speaker Interviews, Videos and Presentations.  You can also join the Information Governance & E-Disclosure group on LinkedIn at http://www.linkedin.com/groups/Information-Governance-EDisclosure-2571255, and follow the event on Twitter @InfoGovSummit.  

Plus, the Project Counsel Media team will be covering the event.

*NOTE:  Discounts are not valid in conjunction with any other offer. Please note discount is off full price registration only. Reduced tickets offered by IQPC are non-transferrable between organisations and only transferrable between individuals within the same organisation where written permission is obtained from IQPC in advance. Reduced tickets are available to corporate practitioners only. The offer does not extend to any company whose main or partial business is the provision of products or services of any kind to the aforementioned company type. IQPC reserves the right to revoke or refuse issue of reduced tickets

**NOTE:  Exhibition passes are only available to Corporates and Law Firms (maximum of 70 passes for Law Firms).This is for entry to the Exhibition and sessions taking place within the Exhibition only. The Exhibition Free Visitor Pass does not include access to conference sessions.

28 March 2012 – Google Apps for Business announced today new features for data archiving, retention policies, and litigation holds of email and instant messaging.  Analysts said the move was on par with its rival Microsoft whose product Office 365 has had similar features since its launch in summer 2011.   For the official announcement from Google click here.   

The announcement from Google is no big surprise.  And it is much more than the presence of Mira Edelman, Discovery Counsel for Google, at LegalTech 2012 this past February.  Google had made clear it had set its sights on the e-discovery market (see our post last year), emphasized even more this year at MWC2012.  When they scooped up Jack Halprin, Autonomy’s ex-vice president for e-discovery and compliance, the direction was set.   As we said last year, Eric Schmidt and Larry Page have always emphasized that Google will get in — and hopefully dominate (anti-trust alert!!) — every aspect of search, and the phrase “information governance” was used extensively at last year’s developers’ conference Google I/O 2011 as well as the numerous “unconference” events we have attended.   Larry Page loves to talk about new technologies that require scalability, simple interface, and complex search technology organically developed, handling any amount of data — massive amounts of data.  Like e-discovery technology.

As we said last year in the post cited above, when Google released that famous database of 500 billion words published in 5.2 million books over two centuries, and then applied its “culturomics” and text analytics that analyzed trends, provided quantative and qualitative analysis … bang, you knew what was coming.

And we are reminded of what Nick Patience told us last year at one of the 451 Research conferences (before he jumped to Recommind): as the e-discovery market matures it is only a matter of time until the “goliaths” come to dominate it.   EMC, Hitachi, IBM, Symantec.  They are all building their share.

By Project Counsel Group staffers:  Gregory P Bufithis, Esq. ;  Juan Di Luca, Esq. ;  Darius Champion, Esq. 

28 February 2012 – In Barcelona, the digital onslaught has begun.  Mobile World Congress 2012 opened yesterday.  To give you an idea of the size, it runs for 4 full days and this year some 60,000+ people are registered to attend.

It’s our third year in a row here and we have a ball.  So far the talk of the town is NOT digital.  It’s transit.  At the last minute the threatened dispute, which would have shut down the metro network, was called off.  And if you know the layout of the city you know that the hotels are spread out and most folks take the metro and not taxis.  But in all fairness, Microsoft and Nokia put on a nice presentation yesterday on their new phones and OS.

We normally attend via our digital/intellectual property company EAM Capital Partners because all of our telecom clients are here.  But this year we are wearing a second hat, as Project Counsel Media.   There are a lot of legal vendors and law firms attending the Congress and we are working with MWC to add an e-discovery component next year.

E-discovery vendors are here already.  Not presenting but attending.  Last year we encountered 3.  This year at least 12+.  Last year was rather cool because we had an off-the-floor presentation of how an ediscovery/forensics expert breaks out a mobile phone and extracts the data.  We hope to see more “lessons” this year.

All in all, this event is about revenue-building strategies for mobile-phone operators, financial services in a mobile world and how to capture more of the connected consumer’s time and money, convergence and the battle for dominance across a range of other telecoms-sector-related channels from smartphone operating systems.  We’ll be reporting on that post-conference on our EAM Capital Partners site.  That will include some chats with IBM and Symantec, two of the vendors here with substantial e-discovery assets and some pretty big staffs here at the show.

And the big gorilla not in the room is Apple (who just announced their new iPad presentation date).    The  smartphone and tablet poster child will stay the course with its tradition of eschewing the trade-show circuit and not make an appearance in Barcelona.

But it leads us to a point we made in our extensive LegalTech 2012 review (click here) and why so many e-discovery vendors are here:

 “Mobile First”.   At LegalTech this year we saw two e-discovery data processing/data review presentations on iPads.  The future.  One of the technology trends that can no longer be ignored is the rise of the Apple platform across all enterprises, a trend I wrote about in January (click here). In one of the conference sessions at this year’s LegalTech, the sentiment from the floor was that the Apple iPad was now the device of choice for attorneys.  And we encountered e-discovery vendors who have developed a niche product line dealing with data collections from Apple products.

No surprise.  It’s a “mobile first” world.  As the folks from Forrester said at their presentation “companies need to realize that mobility is the new front end for engagement systems. Apps are increasingly context aware, fed by the cloud, sensors, history and social data. That requires companies to reconsider how they deploy apps for customers, partners … but especially employees around this enhanced form of engagement”.  Bravo.  Mobile apps from companies can’t just log data, they need to harness all the power of mobile and social to help people get specific jobs done in any particular industry. 

And so it will be for e-discovery applications based on the “industrial strength” presentations we saw.  All you need to see is Microsoft’s purchase of Skype, Google’s acquisition of Motorola Mobility and Deloitte’s acquisiton of Ubermind to realize that technology’s next phase will be those firms that boast the most compelling ecosystems of devices and cloud-based services.  And it also explains why e-discovery vendors last year attended the Mobile World Congress and learn more about technolgy, platforms and “industrial strenth” apps.

Apple has had something of a head start in this race thanks to the visionary Mr Jobs, and they are clearly winning hearts and minds in the enterprise, but Amazon, Google and a host of other companies are now hard on its heels.

But this marvelous convergence of diverse technologies and applications and the “what is possible” makes attendance at events like the Mobile World Congress mandatory.

My most excellent trip

By:  Gregory P. Bufithis, Esq.   Founder/CEO   

24 February 2012 – I journeyed to LegalTech 2012 a few weeks ago from my home base in Belgium.  This past year I have eschewed the usual e-discovery circuit.  My  Posse List and Project Counsel conference teams  did  attend various e-discovery conferences in the U.S. and Europe because it is good to keep up with the details of the industry — new document review dashboards, predictive coding, legal holds, preservation, data privacy, social media, “legal-not-talking-to-IT-and-visa-versa”, etc.

But I do make an exception for LegalTech because in one spot I can meet the vendors that our e-discovery review unit works with in Europe and Asia (we just opened an in-country document review center in China), as well as the several law firms we work with.  And being a native New Yorker, it’s nice to come home now and again.

Information technology and information management has advanced to such a high degree these past two years, and I have become more involved with a private equity group making investments in information management technology, so I changed the priorities of how I cover these changes.   I have learned more, I think, about e-discovery, information management, etc. from the ”Big Picture” high-tech events I have had the opportunity to attend this past year such as The 451 Group technology conferences, the IQPC and Gartner enterprise information management conferences plus the IBM/MIT innovation and technology conferences.  Oh, and the stellar EMC “Big Data” conferences.  Brilliant events.  Lots of contacts.

Because as we all know, data is the new asset class on so many levels.  As the Gartner Group, McKinsey and DealLogic have reported, venture capital and private equity firms have invested something like $5 billion last year in companies built around big data, information management, database management and data processing.  

Side note:  But that is all just a “junior partner” in the data world.  The new “Big Think” is not machine data.  The volume of data we’re generating now from machines pales in comparison to the volume of data we’ll soon generate (are generating) from our own bodies.  My brain waves, my temperature, my pulse, my heart rate variability, my galvanic skin resistance, the number of steps I take, what I eat, what I breathe, who I talked to, my hormone levels, how happy I was, my brain’s efficiency at any time, and anything else I can think of stored in a very large, very secure, very friendly cloud analytics application.  Shared anonymously with any researcher who is doing something cool.  Or my physician.  That’s the big vision.  The new consumer-grade medtech offerings and other technologies  already out there, and in development, are  astounding.  The human body is a blank slate.  There is limitless data to gather about electrical, chemical, and physiological states, as well as about behavior and location.  In every human body roughly ten trillion cells—brainless units of life—come together to work as a unified whole.  And the data they spit out is enormous. Most analysts have tagged this as the “quantified self” movement (for some background information click here) and there was a great presentation by MIT  just across town after LegalTech which  I had the chance to attend with some IBMers and other LegalTech chums  who stayed in NYC  for the whole week.  More on that further below in this post.

So my trip to LegalTech was keyed to several presentations being made to our private equity group by companies seeking funding, or who were just out right “on the block”.  And although technology vendor suite reservations at The London and The Warwick and The Hilton were  down from last year (ask the concierge desk or the bellhops for the scoop; they know everything going on at a hotel) that was probably off-set a bit by the army of VCs and PE folk and analysts who certainly increased in number this year.

But the REAL fun feature of my trip to LegalTech was to test a very cool app called The Mashup App which was developed by our chief technology advisor, Zaid Al-Timimi (http://TheMashupApp.com).   The app (5 years in development and 3 years in beta) is now available on the Apple iTunes App Store (you can access the app by clicking here) is a vision for the future of the web: a web where we control our personal information and curate our digital data — from memories to knowledge– all from our personal device(s).  Mine were the iPad and iPhone.

The Mashup App is built on a few very simple concepts:

1. A personal database in which we save our digital data. We can save all types of data including web, PDF, images, video, audio, location, and time data. Since your personal database is on your device, you can save everything that is important to you – in this case, a log of every place I visited during my 3 days at LegalTech, and the  3 days after in NYC at client meetings.  It is brilliant.  Unlike a file name, we can describe the data using full sentences in multiple languages. This helps a person to remember their data.  And unlike folders, we can aggregate — or mashup– the data into multiple categories. This allows us to create knowledge from the data by providing context and commentary.  You will see what I mean in a minute.  Since categories help organize related data, you can easily mashup web content with video or any other type of data saved in your database (I did a mashup of our video interviews, the accompanying PDF presentations, related articles, etc.).  Furthermore, you can associate calendar events and address book contacts with data in your personal database providing seamless access to your data from your device’s built-in apps (I did a mashup of all my receipts for each day, at each location I visited, meetings I had… to each calendar event. This provided me with total recall).
2. Once done, you can easily search your personal database even if it is very large and contains gigabytes of data.  Unlike a key-word web search, you can search for your own descriptions of the data.  And since you can store location and time data, you can search your personal database by time, location, and other related data.  And unlike the web, you can sequentially browse your personal database so that you refresh your recollection of events, remember important data, and relive old memories (although I did delete all memory of that infamous Recommind party)
3. After searching or browsing your personal database, you can see your results using 3D visualization, listen to it using text-to-speech, or use augmented reality to project the data onto your device’s camera or map.
4. Best of all:  we can share our data not only using email, Twitter, and SMS text messages but also with RSS feeds.  For me, I had The Mashup App generate a report of my LegalTech coverage with a table of contents allowing me to write this blog post.  Once we curated the raw video data, speaker content, and our conference notes, we created higher level “meta” categories based on topics and themes across all the speakers.  We then exported these knowledge-bases in the form of self-contained databases and shared them with our whole team. Now, we have complete knowledge transfer of individual speaker content and our specific analysis, our aggregated analysis across all speakers at LegalTech 2012, and our “meta” analysis on industry themes, trends, and topics inclusive of LegalTech 2012 and all our public and private sources.

So let’s take a look at this app vis-à-vis my most excellent adventure at LegalTech (note:  just click on any graphic to make it larger).

▪  LOCATION, TRACKING AND DAY-BY-DAY DIARY

I flew from Brussels to D.C. the weekend before LegalTech for staff meetings.  So we start with the app’s Vicinity Alert which automatically displayed my train ticket information when I approached Washington DC’s Union Station, e-ticket at the ready.

Vicinity Alerts

Location Visualization: Remembering your trips

Each pin represents a location I was near (based on GPS, cell tower triangulation or Wi-Fi base station location). To ensure the location logging does not drain the device’s battery, The Mashup App intelligently monitors battery and power usage. The tradeoff is that the location log will not be completely accurate and may require a few taps and drags to ensure better accuracy. (Sometimes you need to delete or “adjust” stray locations when you realize it placed you at a scandalous bar).  Amazingly, I did not see any noticeable depletion of the battery level.

Intelligent sensor management

I am sure that many of you might be concerned with the logging of location data. Once you realize that The Mashup App only stores this information in your personal database which you can encrypt, you should be able to enjoy memorializing your trips.

From this I could generate a “diary” of my day, or my week and I could also associate any document — such as a PDF or a restaurant receipt or dry cleaning bill — I had to that “pin” location and/or day.

Location Log

Suggestion:  Get the app for your accountant.  He or she will kiss you.  Your whole trip, catalogued, in one place.

Another suggestion:  Get an AirStash USB.  It streams files via Wi-Fi to your iPads and other devices, without USB ports.  It’s available on Amazon and costs about $150 for an 8 gigabyte model.  Ok, pricy but it will increase the storage capacity of a base iPad by 50 percent.

And what was incredibly helpful was the ability to add location data to a picture, document, or video.   Yes, I know.  Most devices can automatically add location data when you take a picture with the built-in camera.  But I was able to add location data to my photos and videos – it can be added to any item in your personal database — PDF, web, audio, and video content — to identify who I met, why, salient notes, etc.   

▪  THE REALLY COOL PART: VIDEO MANAGEMENT AND INTEGRATED ANALYSIS

But the most thrilling part for me was the video mashup.  Our video crews shot 50+ videos at LegalTech.  I was able to load all of them onto my iPad and create categories containing all the videos as well as accompanying PDFs or other material of the folks we interviewed.  I was then able to review, edit and clip from each video the appropriate piece to illustrate my LegalTech analysis (which you will see farther down below) via the interface:

Ralph Losey at LegalTech 2012

And to help you remember the context of the video clip, you can choose the most appropriate video frame and make it the poster image. The Mashup App handles all of the video’s time index details.  And you can export in any format you require.

A poster image captures a memorable moment

Warwick Sharp at LegalTech 2012

I cannot even begin to detail all this app can do in the photo and video regard but among one of its very cool features is the integration with the built-in Photo app which most people use to synchronize videos and photos from their computer or created with the device’s camera.  I used The Mashup App to manage our video assets. Whether we used our professional cameras for the formal interviews or our iPhones and our Canon Vixia HFR20s swing cameras to capture a spontaneous moment, I knew that I could save the video content into my personal database and create my own video archive.

My video archive

PDF management: Large document support

Because of this innovation, everyone in the legal profession can now manage and organize their case documents based on themes and topics rather than simple file and folder names.

And our Project Counsel teams, being multi-lingual, can now share their case analysis in their native languages even though the underlying source documents may be in a non-English language — an added function of The Mashup App.

Categories: Group your data by providing context and commentary

You can also annotate time and location data to describe where and when a document was authored, signed, or destroyed.  And The Mashup App manages the electronic page count and printed page numbers to minimize the differences between digital and printed PDF content and to foster content collaboration.

If you attended LegalTech, you know there were 20+ sessions and off-the-floor presentation dedicated to predictive coding and technical assisted review.  I used the various functions in the app to mashup the predictive coding/technical assisted review presentations made by Deborah Baron, Maura Grossman, David Katz and Ralph Losey with the video interviews and then organize them into “meta” categories.

Meta Categories: Amalgamate concepts to create knowledge

Meta categories allow me to group content at a higher level of abstraction. For example, I want to organize my analysis of the topics of predictive coding and TAR. So I created two meta categories: one for “predictive coding and TAR at LegalTech 2012” and another all inclusive “predictive coding and TAR” which includes other sources such as Judge Peck’s article on TAR from Law Technologies News October 2011 issue plus the myriad articles published on the subject by such sources as Metropolitan Corporate Counsel.

PDF data visualization: Better than a file name

▪  ANNOTATING THE WEB

As The Mashup App has only been publicly available for a few months, it is missing a few features.  One of those is the ability to highlight individual lines within a PDF page. Annotating web pages on the other hand is fully supported. I can highlight, delete, and format any part of a web page and then save it to my personal database.  All of the images, fonts, and styles are saved with the page into my personal database so I don’t have to worry if the web page is taken down… pixel-for-pixel magic.

A mashup of annotated web content with related PDF content from multiple sources

▪  And once you’re all done mashing up ….

And once you’re all done, you can share individual data items as well as categories of data via email and through web feed and report generation—and you can also share your personal database. Each personal database is implemented as a single file which makes sharing simple.  I was able to distribute to all team members a complete, integrated, annotated file on LegalTech – videos, content, analysis.

Very cool stuff, indeed.  Ok, it does take some practice.  But you will find it is quite easy and you learn something new each time you use it.  But we are all in a high-tech industry and most of us promote the grandeur of our tech ability, our tech products.  So “cutting edge” is a piece of cake.  And to get  you started, we are giving out 50 copies of the app.  You will find full details at the end of this post.  But first, just a few comments on LegalTech.

LEGALTECH 2012 ▪  THOUGHTS AND TAKEAWAYS

▪  Technology!  Oh, the places you’ll go! (apologies to Dr Seuss)

As noted at the beginning, I have spent the past year at the ”Big Picture” high-tech events such as The 451 Group conferences, the Gartner enterprise information management conferences and plus the IBM/MIT innovation and technology conferences.

This “industrial revolution of data” with vast amounts of digital information being created, stored and analyzed has given rise to a demand for tools and people that can both analyze and visualize the information. And my take-away from the past year’s events:  we ain’t seen nuthin’ yet.   My view is that the future of e-discovery and data management will involve such a development of information technology and corresponding uptake across the entire legal profession that such things as automated production of documents and intelligent e-discovery systems will become staggeringly more efficient.  And less costly than even the lowest-paid lawyers.

The technology is faster, better, cheaper.  And this strikes me as a logical life cycle of humans always striving to make our existence less and less laborious.  And cheaper.  The person who correctly figures out the next step in the cycle will surely be the big winner.  But this is the great disruptor in the e-discovery market, especially the contract attorney sector.  Not that physical jobs are disappearing into India.  It is the technology, not India, driving the change.

And the drivers will be a mix of the “usual suspects” plus some up-and-comers.  The future of ediscovery will be driven by companies like Autonomy (now owned by Hewlett-Packard), Digital Reasoning, EMC, IBM, Logik, and ZyLAB.  These companies combine big data know-how with analytics expertise, seeking to make sense of massive amounts of historical and newly collected data for business operations, overall information management and e-discovery.  We saw some of this software in action at LegalTech, two such programs on iPads.   In general these are text analysis platforms and media analysis platforms (mobile phone data, photos, audio, etc.) that ingest large volumes of unstructured text/media data, identify the entities and relationships within it and then store the resulting data in its knowledge base as so-called “knowledge objects”.   One can even create amazing Venn diagrams.

Side note:  “Mobile First” -  Those two presentations we saw on iPads.  The future.  One of the technology trends that can no longer be ignored is the rise of the Apple platform across all enterprises … a trend I wrote about in January (click here). In one of the conference sessions at this year’s LegalTech, the sentiment from the floor was that the Apple iPad was now the device of choice for attorneys.  And we encountered e-discovery vendors who have developed a niche product line dealing with data collections from Apple products.

No surprise.  It’s a “mobile first” world.  As the folks from Forrester said at their presentation “companies need to realize that mobility is the new front end for engagement systems. Apps are increasingly context aware, fed by the cloud, sensors, history and social data. That requires companies to reconsider how they deploy apps for customers, partners … but especially employees around this enhanced form of engagement”.  Bravo.  Mobile apps from companies can’t just log data, they need to harness all the power of mobile and social to help people get specific jobs done in any particular industry.  And so it will be for e-discovery applications based on the “industrial strength” presentations we saw.  All you need to see is Microsoft’s purchase of Skype, Google’s acquisition of Motorola Mobility and Deloitte’s acquisiton of Ubermind to realize that technology’s next phase will be those firms that boast the most compelling ecosystems of devices and cloud-based services.  And it also explains why so many e-discovery vendors last year attended the Mobile World Congress with more scheduled to attend this year.

Apple has had something of a head start in this race thanks to the visionary Mr Jobs, and they are clearly winning hearst and minds in the enterprise, but Amazon, Google and a host of other companies are now hard on its heels.

But as a software program grows in size and complexity, the software can become a cruel maze.  As Jason Lanier has written when discussing large-scale software “it will feel like a labyrinth … even the best software development groups periodically find themselves caught in a swarm of bugs and design conundrums”.   And let’s face it:  much of the “high tech” e-discovery software we use day-to-day in review rooms is deficient despite the sales pitch at such venues as LegalTech.   Last December in D.C., at a major law firm’s document review, we saw a “state-of-the-art” document review software “crash and burn” due to a myriad of tech failures … not scalable, suffering from “lock-in” (poor integration of different pieces of an enterprise software that do not function well together) coupled with poor supervision by the firm’s staff attorneys whereby the review was summarily dismissed while the law firm “rethought” its options.  But we get reports on these tech burnouts on a regular basis via contract attorney membership who provide ongoing feedback on almost all the document review platforms.

And it will get more complicated as we move more and more toward unified information access platforms … let’s turn THAT into a LegalTech buzz word … which are platforms that integrate large volumes of unstructured, semi-structured, and structured information into a unified environment for processing, and analysis.

 A typical unified information access platform

This is an area in which companies like EMC, IBM and ZyLAB excel.  Especially IBM and its business analytics information software.  These platforms are highly scalable, hybrid archtectures that combine elements of database and search technologies.  And the data visualization features (not used in e-discovery so much but in business intelligence applications) are incredible.  We had a chance to see IBM software in action about a year ago (click here).

It can all be a bit overwhelming for the average corporate client, even law firm.  And there is often a disconnect, a feeling that there is a lack of transparency on the return of investment despite all that sizzle and new-fangled tech.  We spoke to Scott Holec, co-founder and President of eTERA Consulting, about these issues.  Here is a snip from that interview:

Video interview of Scott Holec

Note:  we’ll have a full post next week on eTERA Consulting which will feature  our full video interview with Scott.

▪  Cyborgs attack!!  Predictive coding and technology assisted review

Predictive coding.  Technology assisted review.  Technology that is faster, better, cheaper.  This strikes me as a logical life cycle of humans always striving to make our existence less and less laborious.  And cheaper.  The person who correctly figures out the next step in the cycle will surely be the big winner.  But this is the great disruptor to the e-discovery market.   We had a great conversation about this with Warwick Sharp of Equivio.  Here is a clip from that interview:

Video interview of Warwick Sharp

There were 5,198 sessions dedicated to it at LegalTech (or so it seemed).  The concepts behind it are not new, and actually quite familiar.  Last year I had a chance to see the neuroscience and software architecture behind it and wrote a few notes (for that post click here).

The problem with all of this is that it resembles “Linsanity”.  We have been pummeled with predictive coding and technology assisted review these last two years and with 21^st-century attention spans that can grow weary of anything after two weeks, it can be mind-numbing.  And with vendors battling over who invented what first, who has the patent, etc. it can resemble a combination of mud wrestling, roller derby and pillow fight.

The simplest analogy to explain it is just look at our regular life on the web.  Algorithms will find correlations between the posts you open, the links you click and suggest purchases, or link to a romantic adventure, or suggested travel.  In fact Ralph Losey, the preternatural oracle of e-discovery culture, makes this very analogy in his explanation of predictive coding and the science behind it:

Video interview of Ralph Losey

And, he continues, the beauty of predictive coding is what it can do, and its contribution to trial preparation:

Video interview of Ralph Losey

But Ralph emphasizes, there is still a role for the human eye:

Video interview of Ralph Losey

But … there is always a but … are things going to change that much?  Nobody has covered the whole area of predictive coding and technology  assisted review (TAR) as well as The 451 Group.  We had a chance to catch up with David Horrigan, an attorney and analyst for The 451 Group  E-Discovery and Information Governance unit.  He led a panel on the whole TAR area and provides some key take-aways … and a feeling that fundamentally things aren’t going to change all that much:

Video interview of David Horrigan

Note:  full versions of all three interviews … David Horrigan, Ralph Losey, Warwick Sharp … will post next week when we publish “Where To Learn About Predictive Coding“.   Vendors, law firms and e-discovery pundits have flooded us with source material and we’ll publish the above video interviews plus boatloads of and links.  And to get you going here is a link to Ralph’s excellent series “Secrets of Search” (click here).

Data privacy.  Dead?   Well, kinda.  But you might get fined.

In late November 2010, we attended in Paris (along with 300+ privacy professionals) the inaugural IAPP Europe Data Protection Congress.  Yes, the event featured “thought-provoking discussion” and “engaging debate” on the European data protection community.  But there was a feeling that the horse had escaped the barn, that in our Internet connected world any sense of privacy (data or otherwise) was gone.  Viktor Mayer-Schönberger lectured us on “the virtue of being forgotten in the Digital Age” but in most cases it fell on deaf ears.  And a Facebook representative … clearly caught off guard in the coffee line … stated what we all knew: “Well, we sell data.  That’s what we do”.  We know.  We aren’t a customer of Facebook.  We are a product.

And the analytical technology out there is certainly … well … revealing.  At a RAS security conference last year, we were asked to participate in an experiment.  Totally voluntary.  At breakfast we wrote down our name and country of residence and handed it to a vendor.  Not terribly private about it.  That information was on the registration list.  At one of the morning sessions a slide went up … showing our name, full address and where applicable an ID number: social security number, tax ID, driver’s licence, other confirmatory information, etc.   Partially redacted, of course, so the full information was not revealed to the entire audience.   Information searched via some very common, off-the-shelf software.  Yes, it took some tweaking but the level of IT knowledge required was not that sophisticated.

I had written about this last year after Davos 2011 when I said we are moving/having moved towards a “Web of the world” in which mobile communications, social technologies and sensors are connecting people, the Internet and the physical world into one interconnected network.  Data records are collected on who we are, who we know, where we are, where we have been and where we plan to go.  Mining and analyzing this data give us the ability to understand and even predict where humans focus their attention opportunity will resemble a living entity and will require new ways of adapting and responding. All manner of firms collect and use this data to support individualized service-delivery business models that can be monetized.  Simply put:  data has become the new asset class.  For that full post click here.

And let’s be brutally frank about privacy.  Last week Google was being roasted for bypassing the privacy settings of those using Apple’s Safari Web browser, which unlike other major browsers blocks third-party cookies by default. Google, like just about every other online company, relies on cookie files to improve ad relevancy, to identify users, and to deliver online services.

But ask any IT person involved in the TMT (technology, media and telecommunications) sector and he/she will tell you that if you REALLY wanted privacy you would turn off JavaScript, block ads, and browse in privacy mode through an anonymous proxy. But we would rather not do that to have free services. We rely on free services like Gmail while insisting on “privacy,” a term that we probably can’t even define to our collective satisfaction. We accept terms of service contracts and privacy policies that explain in excessive detail how we will not get privacy, how our information will be used, and then we object.

So instead of privacy, let’s talk about control. You do have some of that, still. Make some choices about how your information will be used–because it will be used–instead of accepting default settings. If you object to the way Google does business, use ad-blocking software.

And let’s not even START on the gladiator competition in the TMT market and where it has taken privacy concerns.  Last year I attended the GRC conference on antitrust, competition, technology and IP — a mashup of competition lawyers, TMT counsel and IT mavens, IP experts, analysts, etc.  Brilliant stuff.   I learned that in July 2011, when Apple released its new operating system Lion, it came with Safari 5.1 which included for the first time third-party cookie blocking by default.  Could Apple’s decision to block third-party cookies by default have been influenced by its competition with Google, a company that depends on advertising and cookies?  As John Battelle (a TMT pundit and guru who has written about Google for years) recently wrote “might it be possible that Apple is using data as its weapon, dressed up in the PR friendly clothing of “privacy protection’ for users?”  No way!  (To keep up on the nuts & bolts of the “IP Wars” … besides my brilliant posts on www.eamcap.com … I suggest you follow Florian Mueller at http://fosspatents.blogspot.com)

Making the rounds at LegalTech this year you could not help but notice that the new data analytic technologies have weakened the effectiveness and reliability of anonymization, one of the primary mechanisms available to litigants to navigate cross border discovery conflicts.  It simply emphasized even more the Hobson’s Choice facing U.S. litigators: violate foreign law and expose themselves to enforcement proceedings that have included criminal prosecution, or choose noncompliance with a U.S. discovery order and risk U.S. sanctions ranging from monetary costs to adverse inference jury instructions to default judgments.

Chris Dale does a masterful job (you expected less from The Sage of Oxford?) in summarizing the key points and attitudes on cross-border discovery.  For his post click here.

I suspect we’ll have some major “test case” on privacy in Europe and it will probably come from the raft of IP litigation across Europe, most of it in Germany.  There’s not as much discovery as in the U.S. (we did 3 document reviews in Germany and based on Posse List/Project Counsel membership feedback there were 12 German-based reviews in total last year) but litigation there is comparatively inexpensive, the bench is highly sophisticated, damages are substantial and the process moves quickly.   IP action is heating up all across the globe … Japan, Korea, China, Australia and Spain .. because there is this whole new level of intensity, and global players are looking for forums where they can put pressure on.  At last year’s GRC conference which I referenced above, in-house counsel spoke about how they were stretched to understand how these different forums globally interrelate, in terms of speed and outcome … and all these EU data protection rules.

But just a few lines about social plug-ins, such as the popular Facebook ‘Like’ button, which got some attention on one of the LegalTech panels on privacy and with which we have been involved in Germany on one of our IP litigation reviews.  It is a good example of the data privacy issues involved, and some of the regulatory issues facing litigants.

German data protection authorities have expressed their concern about the plug-ins non-compliance with German data protection and media laws. In the case of non-compliance, administrative fines of up to €50,000 may be imposed. But what especially ticked off the authorities in our case was the transfer of website users’ personal data to the U.S., pointing out that submitted personal data might be combined and used in the form of user profiles.  In our case, that information was being used in a litigation in the U.S. whereas such information would not have been available for use in a German litigation.  And all the litigants were German.  Such collection, transfer and processing of users’ personal data via social plug-ins is contrary to German data protection and media laws.   The German laws are quite explicit:

- there is no valid user consent based on the terms and conditions of Facebook and other social media

- a legally required notice on the right to object is not provided

-  user consent (opt-in) must be obtained in order to install cookies on users’ browsers

No surprise here.  There are already several German rulings that the implementation of Facebook’s ‘Like’ button may be problematic with respect to data protection law.  It is comparable to the use of Google Analytics – a service that has been held as non-compliant with German data protection laws in the past.

According to several “techies” we chatted with at LegalTech there are work-arounds, such as an option for website providers to include the respective content as their own data and not as an iFrame in their websites. This would at least ensure that the mere loading of a website containing a social plug-in would not entail the transfer of personal data to the provider of the respective social media service.

But technical work-arounds are rife with issues, such as whether such a solution comply with the respective licenses granted by the social media service providers, and it still does not provide the data subject with the right to object (which would require technical modifications by the social media service itself).

Beyond my payscale to address.  And it stands to get worse with this new EU data protection scheme as detailed in a thoughtful piece by this week by  Catherine Dunn in Corporate Counsel (click here).

▪  GRC?  Governance? Risk? Compliance? Governance + Risk + Compliance? No, just really risk and compliance.  Oh, that thing.  Whatever.

There was not a lot of direct session chat on the GRC front although there were a lot of vendors selling products to address it.  Which was kind of strange because just on the finance side the global economic crisis created a wave of legislation designed to mitigate risk and protect the financial system from shocks, although as we have seen they are slowly succeeding in skirting many of the big issues (click here).

The surge in regulation across all industries and business models is driving people … well, nuts.   Just taking the health sciences industry as another example, regulation and compliance are a way of life.  It governs the entire product life-cycle – from compound development to clinical trials and approval; from raw ingredient procurement to packaging and tracking through the distribution channel; and more recently (in the U.S.) in documenting the amount of marketing dollars expended on individual healthcare providers.

In an increasingly regulated world, IT plays a crucial role in storing data, organizing that data, and ensuring compliance.   Banks, pharmaceutical companies, and manufacturers and service industries across all lines are devoting a significant proportion of their IT budgets to compliance.

But to the rescue was the crackerjack team of KPMG to put things in a bit of perspective.  And this was sort of a run-up to their just released “The Convergence Evolution”, subtitled “Global survey into the integration of governance, risk and compliance”.  It makes an excellent case for convergence between risk, compliance and governance functions such as strategy and performance.  For a copy click here.

I learned a ton of stuff at LegalTech from KPMG, such as:

*During the financial crisis, organizations were fearful about their longevity and the ramifications of non-compliance with regulatory demands. This environment led to a surge in risk and compliance activities that were costly and had an uncoordinated approach

*Before the financial crisis, 10 percent of respondents took risk and compliance extremely seriously. Today, this proportion has risen to about 40 percent.

*Although many COOs recognize the benefits of improved convergence, only 49 percent label it a priority for their organization. Most are still at a fairly early stage of maturity in their convergence activities.

*Many organizations continue to have a fragmented and overlapping approach to their GRC (sometimes only referred to as risk and compliance) obligations.

*Key tidbit:  more than one-half of respondents surveyed by KPMG said it is difficult to know who has responsibility for specific functions, and it seems to be getting worse.  Oh, dear.  Call in the Venn diagram department!

*And the biggie:  companies still have silos and fragmentation in risk and compliance functions, and KPMG was dying to tell me which ones but kind of fudged with “prominent organizations”.

But … but, but, but … KPMG agreed with me:   not all companies and industries are clueless.  Some are really out front and would very much disagree with the flood of webinars and presentations and their drumbeat of “the gap” between IT and legal in matters of e-discovery demands, be it litigation, regulatory compliance or internal investigations.

Project Counsel has had the benefit of working with companies that “get it”.  Almost all of our clients are in the TMT (technology media telecommunications) industry where technology and information are the lifeblood of the business.   Within these industries we know that IT, legal and information officers work together to manage, document, and streamline their regulatory compliance and litigation initiatives.   We have seen remarkable performances (and technology) where businesses in these industries have unified IT infrastructure for analytics so it covers compliance and risk and performance management as well as e-discovery as a regular business process.   As the general counsel of Samsung told us at a recent event “it is a matter of providing relevant and ‘actionable information’ and improving reporting capabilities across the entire enterprise and delivering detailed insight when required”.  It is, as Gartner has reported in numerous studies, why chief information officers and legal officers and IT professionals in these industries have established a more wide-ranging approach to risk management and compliance and litigation.

We’ll have more later this year when our video crews visit Gartner to interview Deborah Logan, Doyenne Extraordinaire in these areas.

Which takes me to ….

▪  Information governance.  E-Discovery. Together again.  For the first time.

Funny thing information governance.  Go to an e-discovery conference and information governance as a discipline is in its infancy.  Go to an information governance conference and e-discovery is the tail trying to wag the dog.  I am certainly not saying that organizations cannot apply the lessons learned from e-discovery to accelerate their path towards a sophisticated information governance framework.  And as one panelist at LegalTech told me “we aim at the great unwashed and educate them.  Most who come to LegalTech come for education, and are composed of folks across a pretty wide level of experience … but mostly inexperience as regards information governance”.  Well said.  I think.

I suppose I am fortunate, then, that most of my client base come from the TMT, financial services and pharmaceutical industries where a holistic approach to GRC is pretty much in place simply due to high level of regulatory issues they face, and a highly litigious marketplace.  In-house counsel and compliance professionals have the knowledge of the interplay of those related disciplines.  As the roles of the GC and CCO broaden and impact the strategic direction of the business, the importance of integrating GRC technologies has increased along with the value added of high-quality (but lower cost) attorneys to improve ROI.

There were scores of vendors selling products for the “information governance cycle” and it was tough to choose who to interview.  But to get a nice overview of such topics as information lifecycle governance,  content analytics and defensible disposal here is an insightful clip from Michelle Kersey of IBM’s Information Lifecycle Governance Solution (ILGS):

Video interview of Michelle Kersey

Note:  next week we are off to the IBM Information Governance conference in Maryland so … more to come.

▪  New models of review and managed services

There has been a notable shift to what I’ll call a higher level of managed services, both from law firms and vendors.  Not everybody.  But a large number of ediscovery players (vendors, law firms and corporate clients) have developed a new “paradigm” (sorry; we hate that word, too) given the McDermott, Will & Emery malpractice case plus the technology advances in the market.  It is the utilization of “data swat-teams” comprised of contract attorneys who possess the tech skills + the analysis ability with a greater emphasis on data search specialists who have the ability to conduct complex searches, analyze information and generate reports.   Joe Kanka and the folks at eTERA Consulting have sort of pioneered of this approach and we’ll detail it next week in our special post about them.

But several law firms have also adopted the model.  Here is Steve Berrent, managing director of WilmerHale Discovery Solutions, talking about the WilmerHale model:

Video interview of Steve Berrent

And WilmerHale makes an investment in its people:

Video interview of Steve Berrent

We’ll have the full interview with Steve shortly when we post more about this model.

Meanwhile, in London, a few vendors have made themselves a cut above the rest taking managed services to a new level.  Most prominent among them: UNIFIED.  And they’ve taken the model straight through from data collection and processing to review to production.  Paul Mankoo, CEO of UNIFIED, explains:

Video interview of Paul Mankoo

▪  Ah, the cloud.  The cloud.

You know something?  This cloud thing?  It just might catch on.  Or as our buddy Alex Woodie has said “when terminology from the IT department breaks through into the mainstream culture, you know you’re onto something really hot”.  This is the case with the term and the concept behind “cloud computing,” which has spread like a west Texas prairie fire.   In fact we got so excited we devoted a whole website to it called The Cloud and Ediscovery where we try to keep you informed all cloud characteristics (storage, broad network access, resource pooling, rapid elasticity, etc.) and the infrastructure behind the cloud (data centres, IT environments, virtualization, etc.).  We also post about the financial/investment aspects of the cloud, plus news briefs on cloud “gadgets”, etc.  And we post about all aspects of “Big Data” and its visualization, and its contribution to new ways of understanding human patterns, new kinds of business intelligence.

To put it all in perspective, here is Steve D’Alencon, Chief Marketing Officer of CaseCentral, who puts predictive coding and technical assisted review in the context of cloud computing:

Video interview of Steven D'Alencon

Steve went on to discuss what technologies CaseCentral has developed in this new cloud computing milieu:

Video interview of Steven D'Alencon

And here is Mary Mack,  Enterprise Technology Counsel for ZyLAB, putting cloud computing and e-discovery in perspective:

Video interview of Mary Mack

And Facebook?  Well, it’s really a cloud platform:

Video interview of Mary Mack

Note:  we’ll have the full interviews with Steve  and Mary in an upcoming piece on “the ediscovery cloud” which we will post on our cloud site mentioned above.

▪  Asia and E-Discovery:  coming of age

The surge of e-discovery work in Asia is due, no doubt, to the global shift of the industrial supply chain from West to East.  Last year Ernst & Young published an excellent piece explaining this shift of supply officers, CIOs, etc. to the East … along with their servers.   So that shift, coupled with the increasing expansion of Asian-based technology firms (and litigation) has led to ”Elvis has not left the building”:  the data collection and processing stays local.   Singapore was the first Asian jurisdiction to specifically address the discovery of electronic material, after the American, U.K. and Australian courts have made various moves toward doing so.

One of the major players in the Japanese market is Ji2 and in this clip Chad Kime,  Business Development Manager for Ji2, talks about Ji2’s operations in Japan and their attorney document review base:

Video interview of Chad Kime

And Ji2 works with numerous document management software companies:

Video interview of Chad Kime

But it is the Chinese side that is growing by leaps and bounds but with a twist: it is still 80% paper.  We had a chance to chat with Beom Chin, Business Development Director for Data Management Corporation in Hong Kong, DMC, on that aspect as well as his thoughts on ediscovery in Asia:

Video interview of Beom Chin

 Note:  we’ll have the full interviews with Chad and Beom in two upcoming pieces: an overall look at Asian e-discovery, and a special post on e-discovery and litigation in China.

▪  A concluding note on IBM, Watson, Big Data and exponential technologies … plus The Mashup App Give Away 

Last week we had a chance to attend FutureMed, a health-care program that is part of Singularity University, a networked organization dedicated to exploring how disruptive technologies can sweep across whole industries and society.  The subject was the high-tech future of health care. The technologies on display were impressive, often inspiring — like the wearable-robots, or mechanical exoskeletons, made by Ekso Bionics, to enable people with spinal cord injuries to walk again; or IBM’s Watson question-answering computer that is being morphed into a doctors’ smart assistant.  It is just a series of fast-changing technologies including biotechnology, nanotechnology, robotics, artificial intelligence — all due to the surge in analytics surrounding “Big Data”.   Or as Dr. Daniel Kraft, executive director of the FutureMed program, said:  “There are exponential technologies are all around us”.

Dr. Martin Kohn, chief medical scientist at IBM research, sketched out the future path in health care for the technology behind Watson, the computer that last year outwitted the best human players of Jeopardy!   Quote that brought the crowd to tears of laughter: “You’ll not be surprised to learn that the executive leaders of IBM fairly quickly decided that playing Jeopardy! was not a long-term business model.”

It was at Text Analytics World last year where we saw two brilliant presentations by IBM.  One was on their Watson project and the work they are doing on analyzing vast volumes through natural language processing (NLP), and information retrieval (IR) for applications in business intelligence, enterprise knowledge management, e-discovery, etc..  The second was on the algorithms at the heart of predictive analytics for NLP and IR (which they noted have been around for years) that are moving into the mainstream and how they are successfully applying it to all levels of analysis at the enterprise level: financial, legal and BI.

And at FutureMed it was more of the same (the core transferable technology) albeit at a higher level.  Dr. Kohn explained that it was the artificial intelligence software that made it possible for Watson to read and understand 200 million digital pages, and deliver an answer within three seconds. In health care, Dr. Kohn said, “we are overwhelmed by information. And we’re only as good as what we know.”  No, Watson is not going to make diagnoses (afterall, we have Dr House for that) but will make suggestions, recommendations and determine probabilities. The more information Watson is fed, Dr. Kohn said, the more it learns and understands, in its way.

And it’s “star” turn:  medical complexity.  Determining treatment regimens for patients with more than one chronic condition (such patients account for a large share of the nation’s health care costs).  We have well-defined treatment guidelines for individual conditions like heart disease, diabetes, asthma and emphysema. But the guidelines are far less helpful for patients with more than one condition.  For example, a beta-blocker drug is good for heart disease, but bad for asthma, Dr. Kohn noted. What are the trade-offs and what are the probabilities?

The key, the powerful tool that is Watson?  making more decisions based on data and a surer grasp of the relevant scientific evidence — so-called evidence-based medicine — instead of experience and intuition.  Brilliant technology and we’ll have more on it over at www.eamcap.com.

▪  The Mashup App give away

We are giving away 50 copies of The Mashup App which I profiled at the beginning of this post.  I think it is a brilliant app and you will discovery how incredibly useful it can be.  Zaid and I decided that we’ll choose the 50 from those that Retweet this post with the hashtag #TheMashupApp, plus those that email a request to media@projectcounsel.com.  Social Media Operators are (virtually) standing by.

23 January 2012 -  This week (January 25, 26 and 27) Brussels will be host to the 5th International Conference on Computers, Privacy & Data Protection (CPDP 2012).  And the timing could not be better.  The European Commission will on Wednesday propose far-reaching changes to rules dictating how companies handle any personal information, the first time EU regulations first crafted in 1995 are updated. The proposals will impose a single set of privacy standards in the EU’s 27 countries for the first time, overriding often divergent national rules.

Note:  one of our media partners, the Financial Times, has seen a draft of the proposal and a copy was also fed to Reuters.  Our notes come from those two sources plus a friendly mole we met at the Digital Life Design tech industry conference in Munich this week,  and where we are writing this now (best presentation at DLD so far: Yoko Ono.  Very classy and very digital/media savvy).

And … CPDP 2012 is particularly noteworthy this year because one of our colleagues in this industry, Monique Altheim (learn more about her by clicking here) has organized and is moderating a panel at CDP 2012, the panel titled “Principles of eDiscovery in US Civil Litigation” which will discuss the general principles of the U.S procedure of discovery of electronically stored information (ESI) in civil litigation.  Panelists include Chris Dale (e-Disclosure Information Project), Amor Esteban (Shook, Hardy & Bacon), and George Rudoy (Integrated Legal Technology LLC and the Advanced E-Discovery Institute at Georgetown Law Center).

Yesterday at DLD we heard from the vice-president of the European Commission Viviane Reding who said that present EU rules on data protection and privacy are too cumbersome and that this fragmentation is actually costing businesses €2.3bn a year.  She noted that while the new data protection rules are expected to be issued on 25 January, the legislative process may mean that internet companies won’t be expected to comply until 2014 at the earliest.

But businesses have long been been bracing for a radical overhaul of European Union privacy rules.  They have been the subject of much debate and discussion, especially at GRC’s “Law Leaders Conference” in Brussels this past November.   Though watched particularly keenly by technology companies such as Google and Facebook, who store large amounts of personal data, the new EU privacy rules will impact the entire corporate landscape.

Any company maintaining databases that include personal information – be that customer records, internal human resources directories or any other list – will have to comply with the new rules, and be able to show how and why they are using personal data.

Businesses have long called for a single EU data protection structure, but many fear the new standards coming into force are far more stringent than those currently in place at national level.  Said Ron Zink, Microsoft Europe’s chief operating officer and associate general counsel: “We have been pushing for harmonisation of privacy laws for several years, but we are concerned that these proposals may be too prescriptive”.

A draft of the privacy proposals seen by the Financial Times calls for companies to be fined up to 2 per cent of their global turnover if they breach the new guidelines, leaving global multinationals facing bills worth hundreds of millions of euros. Viviane Reding had originally pushed for fines to be set at 5 per cent, but the proposal was watered down just days ahead of its launch.

But … unleash the hounds!!!  … the lobbyists are in full battle mode and are already looking to amend the privacy provisions as the proposal goes to the European Parliament and national governments for adoption, a process that is expected to take well over a year.

The biggie?  The need for companies to get the explicit consent from the people whose data they are processing. The head of the European Telecommunications Network Operators’ Association, a lobby group, warned in a letter to Reding last week that “those rules need to be … adapted to the online world, but we fear that requiring explicit consent will hinder the development of innovative online services and products”.

Companies offering online services are expected to question aspects of a newly created “right to be forgotten” which forms part of the proposal. This will force social networks such as Facebook and LinkedIn to allow users to delete information they have posted online, even after having previously given their consent for it to be public.

The EU’s proposals will include an obligation for companies that misplace any personal information to immediately notify both the authorities and the concerned parties, a rule which is currently in place only for telecoms providers. All companies with more than 250 employees will have to appoint a privacy officer to ensure data protection rules are being followed.

The law will for the first time apply to non-EU companies if they pitch their services to European consumers, a clause which has already been met by opposition from the US authorities.

But perhaps the most tangible impact for companies is that all their privacy issues in the EU will now be tackled by a single EU data protection regulator, which will be that of the country in which they have their main European operations.  A new European Data Protection Board, made up of the EU’s 27 national regulators and the EC, will co-ordinate cross-border cases, such as the one faced last year by Google’s Street View service, which prompted separate investigations in a dozen EU countries.

The impact of the new rules will be felt more in countries which have relatively lax data protection regimes than those where the rules are already tight.  So, EU-wide regulation will hit British companies the hardest, as the UK privacy regime is currently one of the most lenient in Europe.

And new data portability rights will allow people to easily transfer their personal information between different companies and services.

As regards one aspect of all this … the conflict of litigation discovery rights and European individual privacy rights … at the heart of this challenge are the different priorities that different nations place upon an individual’s right to litigate disputes and an individual’s right to privacy.  We have written about it at length.  For a previous post click here.

 

By:  Gregory P Bufithis, Juan Di Luca, Eric Fell and Alexis Gambetta

20 January 2012 -  One of the side-benefits to having The Posse List as one of our Group members is that we receive almost weekly feedback from members, law firms and corporations on the good, the bad and the ugly on almost every document review software and information management software out there in Technology Land.   In any given week, on average, there are contract attorneys and staff attorneys reporting back on 15-20 technologies.  In addition, our beta teams (when permitted under their NDAs) report on various software.  Plus our own learning on our projects here at Project Counsel.

And two software vendors gaining more and more market share are Nuix and kCura (Relativity).  And not just among law firms, accounting firms and corporations.  As we have reported, Nuix has been in beta at DG COMP in Brussels, and both at the S.E.C. in Washington.  More on what government is doing via review, analytics and (scream!) Big Data in a post next week.  

But we have discussed a basket of vendors with corporate counsel and law firm counsel.  This past year our focus has been at the top table corporate counsel and law firm events such as the IQPC Corporate Counsel Exchange, the Association of Corporate Counsel annual meeting, and the International Bar Association technology events — all of which seem to be attracting more and more information management vendors.   Recurring questions to us?  What technologies do you see out there, what are you using, what’s been brought in-house.

So we’ll start with “What are the main differences between Nuix and Relativity, and how are you using them?”   The following is based on our experience via Project Counsel, plus feedback from our corporate and accounting firm partners. 

NOTE:  we have no relationships with either Nuix or Relativity and our guess is they may dispute a few of these points    but hey … just call it a report from the e-discovery war zone.

The two technologies can be best explained by looking at the Electronic Discovery Reference Model (“EDRM”):

Nuix is strong on the left side of the EDRM. Nuix addresses parts of the collection and excels in processing (and indexing) large volumes of data at high speeds.  With regards to review, Nuix is excellent for “early case assessment” (ECA) and ad-hoc searching and “exploring” the data.  There is some built-in “linear review” capability within Nuix (which we used several times this year) but this is pretty basic.  Production and especially redaction can be a wee bit difficult in Nuix but not impossible. 

Relativity on the other hand is focussed more on the right side of the EDRM (review, redaction and production).  It has no processing capabilities, so you cannot ingest raw data (office files, e-mail boxes, etc) as-is into Relativity. You will have to do an intermediate step for this.   A number of clients we work with use Nuix for ingestion, processing, indexing and the creation of so-called “Load Files” via the Concordance legal export function within Nuix.  These “Concordance Load Files” are then used to ingest the data into Relativity.

The review advantages of Relativity are that it is extremely scalable.   Last year we were  were involved with a project that started with 5 reviewers and ramped up in one day so there were 75 concurrent reviewers.  Not a hitch.  

Relativity has review and production features that Nuix is lacking.  It for example can track who has reviewed which document for how long, etc. Also, what you can do and where you can click in Relativity can be entirely defined by the administrator. In Nuix, every reviewer has access to everything. 

We propose the following: 

Nuix (for processing AND review)

-          If you expect a simple and straightforward project

-          If you do not exactly know what you are looking for (ie. there are no keywords yet available, you need to explore the data, etc.)

-          If there are no redaction needs and if you expect an “easy” production (ie, few cycles of production, no or simple bates stamping, etc.)

-          If the number of reviewers are limited … <15

-          If you have a very good e-discovery project manager (a lawyer with good IT skills, or IT expert with legal knowledge; we are told Project Counsel has the best)

-           If the reviewers are more experienced and IT savvy

-          If the budget is rather limited 

Nuix (for processing) + Relativity (for review)

-          If you expect a project growing in complexity and with several phases

-          If you expect lots of additional data to be added during the project

-          If you expect more than 15 reviewers to be needed

-          If you expect important redaction and production needs

-          If you will have inexperienced and IT-illiterate staff in the review

-          If you have a larger budget 

As is the case for any project, do your homework.  Before you start “shopping” and comparing pricing and working a budget you need to determine if your project is being run behind the firewall of the ultimate client (are you the law firm or the end client?).   And the reality is that most clients cannot really estimate the volume of data you will end up with (compressed/uncompressed, new custodians, new data sources, extra data, etc.) leading mostly to negative surprises.  So you need to do that homework.  Because a vendor (any vendor) will need to know:

-          Estimated duration of the project

-          Number of reviewers expected

-          First estimate of data volumes

-          Type of data (e-mails, server data, computer images, etc.)

-          The need for advisory and project management from the e-discovery vendor side; will the vendor be actively involved in the project?  At Project Counsel, we always work closely with the vendor and the law firm client or corporate client, advising and assisting them and always looking for opportunities to improve productivity and efficiency where possible.  [End of promotional plug]

We’ll finish with two video interviews we did last year at LegalTech with Nuix and Relativity.

The first is a chat with Morgan Sheehy, CEO of Nuix, about how the company started, e-discovery, early case assessment, and more:

12 de ENERO de 2012 – Este artículo se dirige a todos los abogados que son Legal Project Manager sin saberlo. Ya es hora de aprovechar vuestra experiencia, vuestros conocimientos y de vuestras habilidades.

Definís objetivos, manejáis costes y tiempo, gestionáis recursos económicos y humanos, coordináis equipos, comunicáis con los clientes y con todos los actores involucrados en un asunto jurídico que os han encargado. Sois abogados. Pero también sois project manager, mejor dicho, legal project manager.

Aunque parezca sorprendente, manejar un asunto jurídico no es fundamentalmente diferente a manejar un proyecto de construcción, una actividad de investigación farmacéutica o un programa de desarrollo.

Para introduciros al concepto de Legal Project Management, debemos dar respuesta a tres preguntas básicas:

• qué es el Legal Project Management
• por qué deberíamos utilizar este enfoque y
• cómo podemos implementarlo en nuestra actividad diaria.

¿Qué es el Legal Project Management?   clic aquí

 21 December 2011– One of the perils of being involved in the e-discovery business (ok, nowadays any business) is being bombarded with more reports, studies and treatises than it is possible to read.  It is at the very least advisable though to skim what one has received.  However  our inbox runneth over with “too much information”.  Sometimes you just want to sit and listen to people who will just put it all in perspective for you.

So it was refreshing to attend the launch of ZyLAB Universe 2011 (we hope it shall be an annual event) that brought together a multitude of legal, e-discovery and information management professionals.  It featured keynote presentations from Gartner analyst Debra Logan and Barry Derksen, research director of the Business & IT Trends Institute plus Johannes Scholtes, Chief Strategy Officer of ZyLAB.

In the afternoon participants were able to select from a variety of thematic break-out sessions, hosted by Daan Lunsingh Scheurleer, partner with NautaDutilh, Gartner analyst Debra Logan and Gonzalo de Cesare of the European Union who shared their vision, best practices and point out industry trends. 

It was a brilliant one-day event that provided the attendee an overview (with quite a bit of detail) of the multitude of issues — legal, IT and otherwise — concerning e-discovery and information management.   Let’s start with  Johannes Scholtes, Chief Strategy Officer of ZyLAB, who we caught after the event to put the day’s themes in perspective:

▪ Pieter Varkevisser with an overview of ZyLAB

Pieter Varkevisser, President and CEO at ZyLAB, provided an overview of the company, and its impressive reach.  It was founded in 1983 in Chicago, now with offices worldwide with 120 employees and was the first company to develop full-text search on the PC platform.   It is a leader in information access, e-discovery and records management.  It’s international presence is enormous with more than 9,000 installations and 1.7 million users world-wide, with offices in the U.S., Europe and the Asia Pacific.

Among its 120 professionals are experts from many different fields.  Some have NATO Top Secret Clearance, some are members of the Sedona Conference and ACEDS, Board Members of AIIM, OLP & NFPA and former consultants from Top Advisory Firms.  And ZyLAB is one of the few companies to be positioned as a Leader in Gartner’s “Magic Quadrant for Information Access Technology” for three following years.  Gartner has also been given ZyLAB the highest rating (“Strong Positive”) in its “MarketScope for E-Discovery and Litigation Support Vendors” and a “Visionary” rating in its 2011 “Magic Quadrant for E-Discovery Software. 

And, as is well known, the presidential administration of George W. Bush and now Barack Obama use ZyLAB to secure their data archiving and access. 

It recently added Samsung as a client.   ZyLAB will be their enterprise-wide standard for in-house e-discovery and will use ZyLAB for early case assessment, targeted collection, processing and machine assisted review for all IP matters.

Note:  we met with Samsung last month and in early 2012 we will have a video interview with Samsung’s general counsel which covers the “patent wars”, the mobile telecom industry, e-discovery and more).

For ZyLAB, Samsung is yet another member of its formidable client base:

▪  Debra Logan of Gartner

It is always a joy attending a presentation of Debra Logan and ZyLAB Universe was no exception.  She cuts to the chase and tell you want you need to know.  Debra is a vice president and distinguished analyst in Gartner Research.  She is the doyenne of information governance, e-discovery, legacy information management and strategic information management, along with new and emerging roles in the digital economy.  Her current work includes information archiving, information retention management, strategic information management and e-discovery market trends.

Her morning presentation consisted of debunking “The 5 Myths of E-Disclosure”:

She covered a lot of territory so we’ll just summarize her main comments.  Her starting points:

* Information is fundamental to the functioning of every legal and regulatory system.

* The recent huge increases in the amount of information have stressed legal and regulatory regimes in all jurisdictions.

* Governments, lawyers, legislators, regulators and businesses are struggling to cope. We must ask how our systems should adapt to these new forms of information life.

Most interesting were her comments about her research showing how governments across all jurisdictions are becoming very involved in information governance, as well as the growing stream of ediscovery revenues coming from Europe and Asia.  She noted Jason R. Baron of the U.S. National Archives and his research into Bush Administration emails using ZyLab software.

Note:  Jason R. Baron is the Director Litigation at the U.S. National Archives and we have interviewed him on numerous occasions.  He is responsible for overseeing all litigation-related activities confronting the National Archives, including complex Federal court litigation involving access to Federal and Presidential records in the National Archives’ custody.  He is presenting a “master class” at LegalTech next year on law in the age of exabytes. 

And that growing stream of ediscovery revenues coming from Europe and Asia.  There has been a shift, with U.S.-based revenues moving from 92% of the total to 89% of the total due to a massive shift in e-discovery software adoption in the EU and Asia.  We have certainly seen it in the EU this past year as we have experienced a significant spike in our e-discovery work on site as corporations have adopted e-discovery software and brought that work in-house.

 Debra urged companies to establish an e-discovery/e-disclosure profile because “it is often a matter of who you are, not where you are”.   She made the following points based on her research and surveys with corporations:

1.  On average, the Legal or GRC budget is >0.5%  of revenue
2.  Companies do have a reliance on larger law firms but are also doing a lot themselves
3.  For most companies, multijurisdictional issues abound
4.  Biggest complaint:  regularly subject to new regulation
5.  There are frequent high-stakes cases, frequent regulatory investigations
7.  There are more than 10 matters per year
8.  Spending is in excess of $100,000 on e-disclosure services
9.  There is a duplication of terabytes of data for legal and regulatory matters
10. If you are in the pharma, high tech, petrochemicals, insurance, or FMCG industries you are most likely to be investigated
 
And social media?  Well, no big surprise: social networking content archiving grows faster than SharePoint archiving.  Organizational requirements for archiving social networking content will surpass requirements for archiving SharePoint data in 2013 (she also made a comment that she thinks SharePoint is a bit out of control because there is no taxonomy).  Her points on social networks and SharePoint:
 
•Organizations continue to prohibit use of social networking applications due to difficulty managing data and defining policies
•SharePoint content is requested more frequently as part of e-discovery activity
•Archiving becomes the accepted mechanism for managing SharePoint data growth
•FINRA Notice 10-06 mandates capture and supervision
•E-discovery costs and penalties associated with this content will increase dramatically
•Archiving becomes the predominant technology for management of this content
 
Oh, and she mentioned a few social media channels:

 

 

 

As regards “the cloud” she provided this interesting graphic:

 

 

Much of her cloud presentation was based on Gartner’s 2012 tech trend outlook and their new Magic Quadrant for cloud, the latter published subsequent to ZyLAB Universe 2011.  You can read them via the following links.  They are chock full of fascinating information:
 
*  Gartner introduces the new Magic Quadrant for Public Cloud IaaS  (click here)
*  Tablets, Cloud, Big Data Are Top Tech Trends for 2012: Gartner (click here)
 
As regards one of this year’s most frequent webinar topic (“Legal and IT do not have to work together to solve e-Discovery problems: discuss”) she made the following points based on her research:
 
• CLOs (chief legal officers) who communicate regularly with CIOs (chief information officers) have higher satisfaction
•  CLOs are finding CIOs to be an important resource in legal strategy and corporate policy formulation
•  Emerging legal technology is not covered well by IT
•  Increased focus on Data Retention and Risk Management
•  IT is not considered in Mergers and Acquisitions
 
And she summarized why legal and IT are natural allies with this graphic:

 

 

She completed her presentation with a discussion of new roles and  ”hybrid” roles developing across corporations to deal with the volume, velocity, variety and complexity of information:

 

 

 

 

Many of these roles are a combination of legal, IT and information management functions.   She sees security professionals being retrained in the law, and legal people receiving IT training, plus the development of Legal IT degree programs.   

For some related Gartner research on the various topics Debra discussed:

 

 

NOTE:  in 2012 we’ll have a video interview with Debra discussing information governance, e-discovery, legacy information management and the new and emerging roles in the digital economy.

 

 

 

▪ Barry Derksen, research director of the Business & IT Trends Institute 

Barry gave us the IT “big picture”.  He has an extensive background having worked with KPMG Information & Risk Management  as an advisor, auditor, and interim manager for various governmental and commercial organizations.   He focused his presentation on how IT can (and must) collaborate effectively with business and legal departments.  Goal?  to make a company more competitive and to reduce costs and risk. He also spoke about how IT should operate by proactively aligning legal, business and IT interests.  As he said “IT needs to cross the chasm” – understand the business, see how IT can add value, and do its part to implement governance and compliance programs”. And that alignment is coming via the cloud:

 

 

 

He is a very entertaining (and informative) speaker and as he spoke we could only think of this cartoon (we hope he does not mind):

 

 

 

His comments on the global picture for IT:

 

 – State of IT is Resilient

 

– Progressing Towards Pre-Recession Levels

 

– Cautious Improvements in IT Spending

 

– Judicious Increases in Hiring & Salaries; Minimum Downsizing

 

– Working Effectively With Business Partners?

 

– HR Not a Major Focus Area

 

– Do IT Professionals Possess the Right Skills?

 

– Offshore Outsourcing and Cloud Trending Upward

 

And in the Netherlands:

 

– Cautious Improvements in IT Spending

 

– Àlignment number 1 management concern

 

– Poor IT value measurements

 

– Cloud & Business Intelligence are THE investment areas

 

-  Security and reliability are the hot topics

 

-  New worlds of work (a typical Dutch thing)

 

 

He sees consumerization as the driving force behind (internal) IT department meltdown.  The cloud and “apps” are the train to catch.  (He told an amusing story of a business exec coming into his office with an app “he wanted now”.  Heartburn all around). 

But to get IT back on board that train he says “IT needs to market itself”.  His coda was simple:

 • Eliminate the old mantra “If we can’t convince them, we’ll confuse them”

• Start effective communication

• Understand the business (they don’t have to understand you)

• Qualify the stakeholders

• Bring your boss

• Get a business coach

• And, yes, accept the iPad.  And social media is great

• Everyone in IT is a  communicator 

He concluded with two thoughts (and graphics):  where is your IT department in the value chain …

 

 

 

…. and where are you in that chain:

 

 

 

 

▪ Johannes Scholtes, Chief Strategy Officer of ZyLAB

 

The problem with trying to report on the presentation of a polymath is you get so absorbed in his/her presentation you stop taking notes.  It tends to be full of fascinating material and can often be quite overwhelming.   Such is the case when you listen to Johannes Scholtes. 

We will give you a few points from the presentation, and include some graphics he kindly provided.  He went through a series of  e-discovery and information management issues we face today, and how ZyLAB products can address and solve those issues. 

He started from a basic premise:  most organizations are ill-prepared for litigation because their records management policies and e-discovery processes are misaligned. IT professionals need to prepare for the special demands created by e-discovery.  And e-discovery is everywhere:

•US Civil cases and US class acts  (US-FRCP)

•US-FCPA (Foreign Corruption Practice Act) and Dodd-Frank related investigations: if a non-US company bribed an official in West Africa, the US can sue this company in the US for this.

•UK Bribery act: you are already guilty if you have not taken counter measures!

•US Export Control. The US does not allow export to countries such as Sudan, Cuba, Syria, and a few others. If a non-USA company does business with these countries, the US subsidiary may be sued for this.

•UN, EU and US Sanction Programs•Extraterritorial influence US antitrust laws: if a non-USA company sets pricing with another non-USA company and US consumers are hurt by this, then the US can sue both companies for this, even if all illegal activities were done outside of the USA.

•EU antitrust investigations.

•S-Ox non-compliance for companies with a US listing.

•EU regulatory investigations.

•National regulatory investigations.•Internal investigations and audits to prevent all of the above

And the information overload is just ongoing: 

 

He then discussed how “pro-active” e-discovery needs to be the approach and he discussed in detail the various elements of the ZyLAB platform and how it can search for risky data combinations.  We cannot capture the delight of his presentation  so let us provide some of the graphics:

 

 

And we have only skimmed the surface of his presentation.  But let’s sum up by saying that Johannes belief is that e-discovery preparedness requires technical and project-management core competencies that are specific to e-discovery but complementary to proper information-management and records-management core competencies.  A well-prepared IT professional can serve as a trusted advisor to business managers and lawyers regarding e-discovery costs, production effort, and risk management.And with the proper e-discovery/information technology you have multiple applications.   Not only can you address an FCPR issue, or deal with a litigation issue along the EDRM or an internal investigations or law enforcement issue but also: 

•Legacy Information Clean-up

•Pro-Active eDiscovery

•Real-time Data monitoring

•Enterprise Information Archiving for legally risky archives: faster discovery and disclosure.

•Identification of potential PII (redaction need and disclosure and DPA/Privacy risks)

 

 ▪ Gonzalo de Cesare, Political Advisor with the European Union Police Mission in Bosnia & Herzegovina

Gonzalo de Cesare  shared his presentation “Enabling Prosecution of the Unspeakable” where he discussed the challenges faced by the UN Information Management team in the Office of the Prosecutor of the war crimes tribubals, which were exceptional in scale and often gruesome in content. 

We have been working with Mr de Cesare for a year and we had the opportunity to interview him at LegalTech earlier this year where he discussed the UN’s process for managing some of the largest and most complex cases in the world (the Khmer Rouge trials, the criminal tribunals for Rwanda, the trial involving Slobadan Milošević, etc.) with information management and e-discovery management software from ZyLAB.  

When you spend time with Mr de Cesare you realize human rights are not a vague or general ideal as far as he is concerned.  Promoting them, pursuing them means defending each individual victim.  For our full post and video interview click here.

 

He had some time after ZyLAB Universe to chat a bit more.  In the first video clip he talks about the ZyLAB technology in general as applied to war crimes investigations.  In the second he talks about about how the ZyLAB technology was used in the Kosovo war crimes investigations.

NOTE:  the interviews are in Spanish but you activate English subtitles.  When you start the video simply click the red button ”CC” (closed caption) on the bottom menu bar, right-hand side. 

In 2012, we will be working with Mr de Cesare, the United Nations and The Hague on various war crime investigations.  We will be providing Project Counsel attorneys and other e-discovery/IT professionals.

And we’ll have more next year from ZyLAB.  We have been invited back for some detailed chat with both Pieter and Johannes and we’ll take along our film crew. 

For more about The Project Counsel Group please click here.

20 December 2011– The global economic crisis created a wave of legislation designed to mitigate risk and protect the financial system from shocks.    This in turn has transformed the relationship between regulators and regulated.   And that just concerns financial regulation.   The surge in regulation across all industries and business models is driving people … well, nuts.   Just taking the health sciences industry as another example, regulation and compliance are a way of life.  It governs the entire product life-cycle – from compound development to clinical trials and approval; from raw ingredient procurement to packaging and tracking through the distribution channel; and more recently (in the U.S.) in documenting the amount of marketing dollars expended on individual healthcare providers.

In an increasingly regulated world, IT plays a crucial role in storing data, organizing that data, and ensuring compliance.   Banks, pharmaceutical companies, and manufacturers and service industries across all lines are devoting a significant proportion of their IT budgets to compliance.   As Sanjay Bhandari of Ernst & Young has told us several times when we have met at the IQPC Exchanges on compliance and regulation ”regulators used to come visiting, now they live with our clients and have access to all their systems.   That means they see everything.  From an IT standpoint, the cost impact is being felt in storing and managing extra data; system and process updating; and, particularly, the added frequency and rigor of IT audits”.

Financial services organizations today seem especially hard hit, facing a wave of regulation, whether from Basel III globally or from Dodd-Frank in the U.S. or the UK Bribery Act or the FCPA.   These regulations are requiring them to change the way they look at and assess risk, to say nothing of the way in which they reserve and allocate capital.

Note:  in the U.S.  federal regulators working under the Dodd-Frank Act have already issued 4,870 pages of proposed or final rules affecting banks.  And according to the American Bankers Association, banks have on average 1.2 employees on compliance for every one focused on lending and bringing in business.

And we haven’t even touched upon data privacy legislation that can affect where and how companies store information or what actions they are subject to if security is compromised.

So … needless to say .. all these new rules on compliance, regulation and how a businesses should be governed (behave?) is always good news for suppliers of information management and e-discovery products which have the delightful task of searching corporate information systems for evidence in a regulatory inquiry or legal case.  Which begets “the technology question.”   Many companies at the receiving end of regulatory investigations fail to recognize that hunting down that information (often to tight deadlines) can be both time-consuming and costly.  As a result, the tendency is not to deal with the issue until an e-discovery order arrives on your desk.   Or even to think about the technology to use.  So they are often clueless on what must be done to produce data, such as an email or instant messaging exchange quickly, if they receive a legal e-discovery request.

Enter Dean Gonsowski, Vice President of E-DiscoveryServices at Clearwell Systems, a part of the information management group at Symantec.   Note:  we have used Clearwell Systems software on diverse projects for our corporate clients in Geneva, Luxembourg and Paris.

Dean’s mantra:  the answer lies in making e-discovery a “repeatable business process” rather than a one-off response to a request.  How?  We caught up with Dean in Munich at the recent IQPC Information Retention and eDiscovery Exchange to discuss that very issue:

We also had a chance to chat with Sigrid Sjöstedt, Legal Counsel for Volvo Car Corporation and a Clearwell Systems client, on lessons learned on making e-discovery a “repeatable process”:

For Mark Surguy, a partner at Eversheds, it means establishing company-wide rules on electronic information, governing what should be deleted or retained, applying those rules and using e-discovery software to retrieve information quickly.  As he has said “regulatory investigations are on the increase. There are more organizations out there with the power to demand that companies produce evidence of their business dealings, both in the form of industry-specific regulators and law enforcement agencies.  It’s now widely recognized by these authorities that, in such cases, the bulk of evidence is likely to be found in digital formats.  Even if your organization doesn’t know exactly what information it holds or how to identify relevant electronic evidence, you should be worried that the opposing side will know.”

How deep can this get?  We had an opportunity to interview Mark earlier this week at Eversheds headquarters in London.  It was simply a “master class” on multi-disciplinary, complex and commercially sensitive cases and how to face large data reviews:

To be fair, not all companies and industries are clueless.  In the last year we have seen a flood of webinars and presentations proclaiming the gap between IT and legal in matters of e-discovery demands, be it litigation, regulatory compliance or internal investigations.  Companies are clueless, unaware.

But not everybody.  Project Counsel has had the benefit of working with companies that “get it”.  Almost all of our clients are in the two most exciting industries today: the mobile telecom industry and the digital media industry, where technology and information are the lifeblood of the business.   Within these industries we know that IT, legal and information officers work together to manage, document, and streamline their regulatory compliance and litigation initiatives.   We have seen remarkable performances (and technology) where businesses in these industries have unified IT infrastructure for analytics so it covers compliance and risk and performance management as well as e-discovery as a regular business process.   As the general counsel of Samsung told us at a recent event “it is a matter of providing relevant and ‘actionable information’ and improving reporting capabilities across the entire enterprise and delivering detailed insight when required”.  It is, as Gartner has reported in numerous studies, why chief information officers and legal officers and IT professionals in these industries have established a more wide-ranging approach to risk management and compliance and litigation.   

We’ll have more early next year when our video crews visit Amazon, Orange, Samsung and other technology companies including information technology powerhouses IBM and ZyLAB.