Electronic discovery poses fresh legal risks

As companies store more information on their computer systems, the costs and possible sanctions stemming from court orders demanding electronically stored documents can become a major issue, observers say.

But having an e-discovery policy and a task force, among other measures, can mitigate, if not eliminate, many of the risks, observers say.

Companies' effectiveness in this area has been mixed, say observers.

Gilbert S. Keteltas, a partner with law firm Howrey L.L.P. in Washington, said there are firms with significant litigation dockets “who have prepared for electronic discovery for years,” while others “wrestle with electronic discovery issues for the first time when faced with litigation.”

Failure to properly preserve and produce electronic documents can lead to court-imposed sanctions totaling millions of dollars and even jail terms for company executives, say observers. In addition, improper document retention also has forced firms to settle cases “long before the merits of the case are ever visited,” said Peter G. Gronvall, managing director of Washington-based consulting firm AdamsGrayson Corp.

In addition, failure to produce documents can lead to an adverse inference ruling, in which a jury is instructed to view the missing material in a light favorable to the plaintiff, experts say.

To Continue Reading: Click Here
-----------------------------------------------
Source: businessinsurance.com
By: Judy Greenwald