Creating a Legal Event Team

This article is intended to provide an overview of how to create an effective Legal Event Team, including who should be on that team, what the team's primary responsibilities should be, and how that team should generally operate. As you will see, a well-designed and well-managed team can ensure not only that an organization isn't consumed with litigation activities, but more importantly, can provide the best and most powerful defense against the types of problems that can lead to sanctions, bad publicity and other adverse events.

Creating Your Legal Event Team

The primary responsibility of the Legal Event Team is to protect the corporation as it is drawn into the legal process. A well-formed Legal Event Team typically includes members from the C-suite, legal, information technology, and human resources departments, as well as outside counsel and discovery consultants or vendors.

The diverse nature of the internal Legal Event Team members is designed to ensure that the entire scope of a legal event can be effectively and efficiently managed. Having C-suite members on the team ensures that it has ready access to and support from the senior-most managers, who not only control resources and budgets, but also often know more than others about operations across the entire company. Members from the organization's legal team, such as the General Counsel or a legal liaison, provide direct legal oversight and serve as the most effective conduit with outside legal and related resources.

Members of the organization's information technology teams, whether employees or outsourced contractors, are essential in helping ensure that the Legal Event Team understands the digital landscape of the corporation, including where and how most employees use and store all forms of electronically stored information. The IT team members also can readily identify and understand more esoteric data resources such as CRM databases, product development and complaint systems, cloud-hosted services and much more.

Human Resources individuals are key to helping identify which employees may be involved in any given action, as well as helping identify employees and even outside contractors for legal hold and data preservation purposes. But beyond that, HR team members can help design and implement educational programs to prepare the organization for a legal event, and help manage any inquiries that may come in during a legal event. And let's not forget that HR is often the first to hear about potential legal matters.

Finally, outside resources are key to ensuring that your Legal Event Team doesn't create and live within an isolated bubble. Outside counsel, consultants, and vendors can provide insight into the plans and practices of other organizations, generally accepted industry practices, new and changing legal standards and much more.

Your Legal Event Team's First Assignment: A Legal Hold Plan

The single most effective action a Legal Event Team can take is to create a legal hold plan. In many organizations, legal hold plans are created only after the first legal event takes place, if then. That has remained true despite the fact that most e-discovery sanctions are the result of a failure to issue and enforce effective legal holds (and the resulting failure to preserve data). Unfortunately, many a case has been lost on spoliation claims alone, without the merits of the case ever seeing the light of day.

Thus, if your Legal Event Team assumes no other role (at least to start), the development, implementation and management of a comprehensive legal hold plan must be its paramount task. Indeed, a good legal hold plan can, by itself, create remarkable efficiencies, significantly reduce costs, nearly eliminate employee disruptions, and, most importantly, protect the organization from a common source of sanctions and other adverse findings.

Before a legal event occurs, the Legal Event Team should focus on creating a comprehensive legal event protocol and workflow. One important consideration, all too often overlooked, is a thought experiment at heart: identifying likely potential sources of triggering events within the organization. This is a function where the diverse makeup of the Legal Event Team especially pays off, as each member brings their knowledge of a separate part of the organization, as well as outside experience and expertise, to bear.

Such brainstorming sessions, along with looking at historical legal events within the company and similar market competitors, can help the Legal Event Team identify the most likely sources for potential legal actions. Understanding where an organization's legal events are most likely to arise will help the team create processes and protocols designed for the early detection of events that may develop into legal issues and trigger the legal hold process.

The Legal Event Team should also decide early on how legal hold notices will be created, issued and managed. The creation of legal hold notices is usually done in conjunction with outside counsel when an event occurs, but in many organizations, coming up with a template for common types of cases can help reduce the costs and speed the actual issuance of the notice. The team should also assign responsibilities in advance about how the legal holds will be issued and managed, whose primary responsibility it will be to identify custodians (often a blend of General Counsel and Human Resources, working with appropriate internal team managers), and how the holds will be issued and managed.

While many organizations still use emails and spreadsheets to manually issue and manage legal holds, software solutions are available at a fraction of historical costs. Those solutions can significantly reduce the overall costs and drastically increase the defensibility over manual processes. If an organization elects to utilize a software solution, it is best to vet, select and implement the solution (and train the team on that solution) well before the need arises.

The Team should also become familiar with the organization's key potential information resources, data storage systems, paper record-keeping practices, and common storage locations for both digital and paper-based information that may be implicated in a legal event. Often, the systems and data resources involved are not readily obvious. A properly prepared and routinely refreshed team and plan can help an organization quickly and easily avoid such problems.

For example, when one thinks of collecting corporate information in a legal matter, email, patent records, and financial information are some of the data types that readily come to mind. But, depending on the nature of the litigation, the types of data implicated might be much different. In product liability matters, data might include design and manufacturing systems, complaint tracking databases, and others. In intellectual property matters, it might include identification of the origin of the IP, by whom and why the IP was created, and steps taken to protect the IP, all of which may be stored in systems not routinely considered.

The team must become familiar with the organization's routine data deletion or destruction policies — from routine email deletions to how exiting employee data is handled — so that they can design data preservation steps to prevent those actions from inadvertently destroying data that otherwise should have been preserved (another common sanction source).

Finally, the Legal Event Team should create educational events within the organization so that managers and other appropriate personnel are aware of what might trigger a legal hold obligation, how to notify the team when such a potential event occurs, how the organization's legal hold notification process works, and what's expected of employees in the event of a legal hold. Such training should be made a part of employee onboarding, and should be a routine annual or semi-annual training event for all managers and other employees. A simple half-hour training session once or twice per year can help ensure that your employees fully understand their obligations, and it will go a long way in helping defend against a rogue employee's actions should someone ignore or purposefully violate a legal hold notice.

When a Legal Event Occurs

Once a legal event is triggered, the Team's role becomes much more focused on a single overriding goal: ensuring that potentially responsive information is not intentionally or inadvertently deleted or altered by people, processes, or routine computer operations. A great first step is to assign an individual as a Legal Event Manager (LEM) to be responsible for managing that particular legal event from onset to conclusion. While each member of the Legal Event Team plays a role, having a single person coordinate and oversee a given legal hold process helps ensure that nothing is overlooked.

Whether a LEM is assigned, or the team collectively takes on the role of managing a given legal hold process, the steps are generally the same. While counsel generally takes on the task of drafting a legal hold notice, others on the Legal Event Team should start identifying employees, contractors, and others who may have been involved in the event, or who may have information related to the event. Those individuals, usually called custodians, should then be notified of the legal hold and asked to identify any potential information resources, including computers and other data storage locations, as well as other individuals who they think may also have information relevant to the event.

In other words, don't simply send out a legal hold notice. Leverage the investment the organization has made and use the process to help refine the scope of the legal hold and ensure that no essential individuals or resources have been inadvertently overlooked — and that those who are included in the process should be. Once those resources are identified, bring any additional people into the legal hold notice process, and make sure that any automated data destruction or other routine processes that may result in data loss in identified data resources are suspended. And don't forget to include any third parties, such as contractors or third party providers, who may hold company information, but over which the company — often by contract — retains ownership and control.

Once the data is identified, your team should take steps to actually preserve (and eventually collect) all identified data in a defensible manner. Remember that preservation and discovery is generally an ongoing obligation throughout a litigation or other legal event. Your team should routinely remind custodians and other appropriate team members (such as the IT team responsible for maintaining and recycling equipment) of the obligation to preserve data throughout the course of the litigation. Most automated legal hold systems have solutions that make that reminder process automatic.

Beyond the notice, preservation and data collection activities, a Legal Event Team can also take an active role in the remaining steps of the litigation, such as utilizing tools to filter collected data and eliminate clearly irrelevant data, and to reduce the amount of data leaving the organization (often greatly reducing later costs of advanced processing and analytics, hosting, review, and production). In fact, several software solutions on the market today are designed not just to help an organization with the legal hold management process, but also to help with the other primary steps that an organization's Legal Event Team often also controls: data collection, preservation, filtering and early case assessment tasks, and more.

A well-formed, functioning and experienced Legal Event Team (properly equipped and supported) can also greatly help an organization better anticipate the potential scope, cost and overall impact to the organization of legal matters much earlier on. That allows the organization's management to better evaluate new legal events, and to more quickly determine the best course of action in pursuing or otherwise resolving a new legal event. With very little investment in terms of both time and money, a Legal Event Team can return significant benefits to the organization, such as immediate discovery cost savings (which can reach into the millions in larger organizations), sanction-avoiding benefits, and the elimination of internal disruptive chaos and employee productivity losses.

*****
Brian E. Schrader is President and co-founder of Business Intelligence Associates (BIA), a legal information management company. Barry Schwartz is a BIA client-facing adviser. This article also appeared in Corporate Counsel, an ALM sibling publication of this newsletter.

The best way to create a successful business process is to start by identifying the people who are key to both creating and managing that process, and then bringing those people together to do just that. This is especially true when it comes to critical business processes such as disaster recovery, business continuity, data breach detection and response — all events for which organizations routinely form teams and create action plans to address.

Yet, even though legal events are often as unavoidable an eventuality as those mentioned above, and at least as disruptive as any of those events, most organizations fail to prepare and plan for legal events until the organization is knee-deep in the event and scrambling to react. That remains true, even though in many businesses today it is not if, but when, corporate counsel will need to guide the organization through a legal event. Organizations are well advised to think about and prepare for legal events in advance, and to take an approach similar to that used to address other processes.

The most effective action you can take to prepare your organization is to create a Legal Event Team that has the mandate to prepare for legal events, and to act when a legal event occurs or might occur. The primary purpose of a business continuity plan, for example, is to help ensure that an organization can quickly recover from a business interruption event, minimizing losses to employee productivity, revenue generation, shareholder value, and other operations. A Legal Event Team serves a nearly identical primary purpose: to help ensure that a legal event is handled in an orderly fashion, with as little impact to operations, costs, and employee productivity as possible.

This article is intended to provide an overview of how to create an effective Legal Event Team, including who should be on that team, what the team's primary responsibilities should be, and how that team should generally operate. As you will see, a well-designed and well-managed team can ensure not only that an organization isn't consumed with litigation activities, but more importantly, can provide the best and most powerful defense against the types of problems that can lead to sanctions, bad publicity and other adverse events.

Creating Your Legal Event Team

The primary responsibility of the Legal Event Team is to protect the corporation as it is drawn into the legal process. A well-formed Legal Event Team typically includes members from the C-suite, legal, information technology, and human resources departments, as well as outside counsel and discovery consultants or vendors.

The diverse nature of the internal Legal Event Team members is designed to ensure that the entire scope of a legal event can be effectively and efficiently managed. Having C-suite members on the team ensures that it has ready access to and support from the senior-most managers, who not only control resources and budgets, but also often know more than others about operations across the entire company. Members from the organization's legal team, such as the General Counsel or a legal liaison, provide direct legal oversight and serve as the most effective conduit with outside legal and related resources.

Members of the organization's information technology teams, whether employees or outsourced contractors, are essential in helping ensure that the Legal Event Team understands the digital landscape of the corporation, including where and how most employees use and store all forms of electronically stored information. The IT team members also can readily identify and understand more esoteric data resources such as CRM databases, product development and complaint systems, cloud-hosted services and much more.

Human Resources individuals are key to helping identify which employees may be involved in any given action, as well as helping identify employees and even outside contractors for legal hold and data preservation purposes. But beyond that, HR team members can help design and implement educational programs to prepare the organization for a legal event, and help manage any inquiries that may come in during a legal event. And let's not forget that HR is often the first to hear about potential legal matters.

Finally, outside resources are key to ensuring that your Legal Event Team doesn't create and live within an isolated bubble. Outside counsel, consultants, and vendors can provide insight into the plans and practices of other organizations, generally accepted industry practices, new and changing legal standards and much more.

Your Legal Event Team's First Assignment: A Legal Hold Plan

The single most effective action a Legal Event Team can take is to create a legal hold plan. In many organizations, legal hold plans are created only after the first legal event takes place, if then. That has remained true despite the fact that most e-discovery sanctions are the result of a failure to issue and enforce effective legal holds (and the resulting failure to preserve data). Unfortunately, many a case has been lost on spoliation claims alone, without the merits of the case ever seeing the light of day.

Thus, if your Legal Event Team assumes no other role (at least to start), the development, implementation and management of a comprehensive legal hold plan must be its paramount task. Indeed, a good legal hold plan can, by itself, create remarkable efficiencies, significantly reduce costs, nearly eliminate employee disruptions, and, most importantly, protect the organization from a common source of sanctions and other adverse findings.

Before a legal event occurs, the Legal Event Team should focus on creating a comprehensive legal event protocol and workflow. One important consideration, all too often overlooked, is a thought experiment at heart: identifying likely potential sources of triggering events within the organization. This is a function where the diverse makeup of the Legal Event Team especially pays off, as each member brings their knowledge of a separate part of the organization, as well as outside experience and expertise, to bear.

Such brainstorming sessions, along with looking at historical legal events within the company and similar market competitors, can help the Legal Event Team identify the most likely sources for potential legal actions. Understanding where an organization's legal events are most likely to arise will help the team create processes and protocols designed for the early detection of events that may develop into legal issues and trigger the legal hold process.

The Legal Event Team should also decide early on how legal hold notices will be created, issued and managed. The creation of legal hold notices is usually done in conjunction with outside counsel when an event occurs, but in many organizations, coming up with a template for common types of cases can help reduce the costs and speed the actual issuance of the notice. The team should also assign responsibilities in advance about how the legal holds will be issued and managed, whose primary responsibility it will be to identify custodians (often a blend of General Counsel and Human Resources, working with appropriate internal team managers), and how the holds will be issued and managed.

While many organizations still use emails and spreadsheets to manually issue and manage legal holds, software solutions are available at a fraction of historical costs. Those solutions can significantly reduce the overall costs and drastically increase the defensibility over manual processes. If an organization elects to utilize a software solution, it is best to vet, select and implement the solution (and train the team on that solution) well before the need arises.

The Team should also become familiar with the organization's key potential information resources, data storage systems, paper record-keeping practices, and common storage locations for both digital and paper-based information that may be implicated in a legal event. Often, the systems and data resources involved are not readily obvious. A properly prepared and routinely refreshed team and plan can help an organization quickly and easily avoid such problems.

For example, when one thinks of collecting corporate information in a legal matter, email, patent records, and financial information are some of the data types that readily come to mind. But, depending on the nature of the litigation, the types of data implicated might be much different. In product liability matters, data might include design and manufacturing systems, complaint tracking databases, and others. In intellectual property matters, it might include identification of the origin of the IP, by whom and why the IP was created, and steps taken to protect the IP, all of which may be stored in systems not routinely considered.

The team must become familiar with the organization's routine data deletion or destruction policies — from routine email deletions to how exiting employee data is handled — so that they can design data preservation steps to prevent those actions from inadvertently destroying data that otherwise should have been preserved (another common sanction source).

Finally, the Legal Event Team should create educational events within the organization so that managers and other appropriate personnel are aware of what might trigger a legal hold obligation, how to notify the team when such a potential event occurs, how the organization's legal hold notification process works, and what's expected of employees in the event of a legal hold. Such training should be made a part of employee onboarding, and should be a routine annual or semi-annual training event for all managers and other employees. A simple half-hour training session once or twice per year can help ensure that your employees fully understand their obligations, and it will go a long way in helping defend against a rogue employee's actions should someone ignore or purposefully violate a legal hold notice.

When a Legal Event Occurs

Once a legal event is triggered, the Team's role becomes much more focused on a single overriding goal: ensuring that potentially responsive information is not intentionally or inadvertently deleted or altered by people, processes, or routine computer operations. A great first step is to assign an individual as a Legal Event Manager (LEM) to be responsible for managing that particular legal event from onset to conclusion. While each member of the Legal Event Team plays a role, having a single person coordinate and oversee a given legal hold process helps ensure that nothing is overlooked.

Whether a LEM is assigned, or the team collectively takes on the role of managing a given legal hold process, the steps are generally the same. While counsel generally takes on the task of drafting a legal hold notice, others on the Legal Event Team should start identifying employees, contractors, and others who may have been involved in the event, or who may have information related to the event. Those individuals, usually called custodians, should then be notified of the legal hold and asked to identify any potential information resources, including computers and other data storage locations, as well as other individuals who they think may also have information relevant to the event.

In other words, don't simply send out a legal hold notice. Leverage the investment the organization has made and use the process to help refine the scope of the legal hold and ensure that no essential individuals or resources have been inadvertently overlooked — and that those who are included in the process should be. Once those resources are identified, bring any additional people into the legal hold notice process, and make sure that any automated data destruction or other routine processes that may result in data loss in identified data resources are suspended. And don't forget to include any third parties, such as contractors or third party providers, who may hold company information, but over which the company — often by contract — retains ownership and control.

Once the data is identified, your team should take steps to actually preserve (and eventually collect) all identified data in a defensible manner. Remember that preservation and discovery is generally an ongoing obligation throughout a litigation or other legal event. Your team should routinely remind custodians and other appropriate team members (such as the IT team responsible for maintaining and recycling equipment) of the obligation to preserve data throughout the course of the litigation. Most automated legal hold systems have solutions that make that reminder process automatic.

Beyond the notice, preservation and data collection activities, a Legal Event Team can also take an active role in the remaining steps of the litigation, such as utilizing tools to filter collected data and eliminate clearly irrelevant data, and to reduce the amount of data leaving the organization (often greatly reducing later costs of advanced processing and analytics, hosting, review, and production). In fact, several software solutions on the market today are designed not just to help an organization with the legal hold management process, but also to help with the other primary steps that an organization's Legal Event Team often also controls: data collection, preservation, filtering and early case assessment tasks, and more.

A well-formed, functioning and experienced Legal Event Team (properly equipped and supported) can also greatly help an organization better anticipate the potential scope, cost and overall impact to the organization of legal matters much earlier on. That allows the organization's management to better evaluate new legal events, and to more quickly determine the best course of action in pursuing or otherwise resolving a new legal event. With very little investment in terms of both time and money, a Legal Event Team can return significant benefits to the organization, such as immediate discovery cost savings (which can reach into the millions in larger organizations), sanction-avoiding benefits, and the elimination of internal disruptive chaos and employee productivity losses.

*****
Brian E. Schrader is President and co-founder of Business Intelligence Associates (BIA), a legal information management company. Barry Schwartz is a BIA client-facing adviser. This article also appeared in Corporate Counsel, an ALM sibling publication of this newsletter.