1. When can you safely release records from legal/preservation holds so they are not stuck in an indefinite/permanent limbo?
This is a question that goes to the heart of a successful legal holds program, and one that my clients ask constantly. There is no easy answer to this question. To release the legal holds, you will need input from your counsel. The holds become candidates for release once a case has settled. This should occur 80-90% of the time. Settlements offer a very clear finite date for release of the hold (i.e., when the settlement agreement is signed after court approval and/or final payment made on the settlement). Otherwise, a hold can be released once the case has been resolved through verdict or court dismissal of the case. In those minority scenarios, you will need to work closely with counsel to determine the likelihood of appeal and whether all or only some of the documents at issue may become relevant in the appeal. The documents determined relevant will need to remain on hold until counsel announces conclusion of the case (e.g., verdict on appeal or settlement during appeal). Once a hold has been released, the records then go back to their normal retention schedule. If retention periods have expired, they should be disposed immediately. If not, the records need to return to their lifecycle. Both of these scenarios assume the records at issue are not relevant to other pending or anticipated litigation. Diligent watch of legal hold release is key to avoid the indefinite limbo. Be especially vigilant of changes in scope during the litigation, when issues may be dismissed, settled or abandoned, thereby resulting in other documents to release even during litigation. Stay in close contact with counsel for updates. For more details on this issue, please check out my book 7 Steps for Legal Holds of ESI and Other Documents, published exclusively by ARMA International.
2. Why can’t Corporate Legal Counsel’s office maintain chain of custody?
Chain of custody is a complex issue, particularly in the electronic arena. Think of it as Electronic Crime Scene Investigation (E-CSI). Having corporate counsel maintain chain of custody would be akin to having the perpetrator keep her own hair sample intact to present it as evidence against her at trial. This is, of course, an exaggerated metaphor. The fact is that in-house counsel is by most accounts an interested party, and in fact the attorney-client privilege does not always ascribe to her work for the organization. In-house counsel often wears the hat of both corporate officer and of legal counsel. The former makes her an interested party. At its core, the issue for chain of custody boils down to the duty of the organization to produce information as it is ordinarily maintained during the course of business, assuming adequate authentication measures are in place. Once litigation ensues, counsel for the organization (which likely will not be in-house counsel in large, sensitive or complex matters) should come to agreement with opposing counsel for how information should be preserved and produced for discovery and at trial.
3. Why does it seem like Corporate Attorneys fail to practice what they preach when it comes to good Records Management?
In defense of in-house attorneys, I would have to say that many records maintained in the legal department are frequently copies of records owned by someone else within the organization. For example, contracts may be owned by the business unit that generates it, and legal may simply keep a copy of it. This may result in the attorney’s cavalier attitude towards her copies. Conversely, some records maintained by legal tend to have retentions tied to the life of the organization, such as corporate bylaws or articles of incorporation. Therefore, keeping track of a retention schedule for these records is not paramount. That said, as a general rule, attorneys are usually the last adopters of technology, which makes it hard enforce electronic initiatives within their departments. Related to that, many senior attorneys were taught with old school methods involving bound books, legal pads and pens. We prefer to preserve all of our notes and previous drafts of work done as reference materials. No one likes to re-invent the wheel when a similar contract type or other transaction document comes around for a second time. As a result, we tend to be very conservative hoarders, especially when many of us feel we do not have anything to hide. As the new generation of tech-savvy lawyers continues to climb the corporate ladder, while witnessing more senior lawyers getting walloped by poor recordkeeping practices, I suspect we will see more RIM-compliant corporate attorneys.
John Isaza is a California-based attorney and founding partner of the Howett Isaza Law Group, a law firm that specializes in electronic information governance, records management and overall corporate compliance. He may be reached at Jisaza@HiLawGroup.com or follow him on Twitter and LinkedIn.
John J. Isaza
Howett Isaza Law Group LLP
465 Forest Avenue, Suite H
Laguna Beach, CA 92651
Check out my 7 Steps for Legal Holds book at: http://tinyurl.com/mo722k
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Web page: www.HiLawGroup.com