Using discovery agreements to your advantage

Using discovery agreements to your advantage
Canadian lawyers continue to adapt to new rules in various jurisdictions that require or permit meet-and-confer conferences or discovery agreements. Proponents say that discovery agreements let parties limit the scope — and therefore cost — of documentary discovery. Litigation procedures are streamlined by narrowing issues early, circumscribing “relevance,” and limiting interlocutory procedural motions.
However, detractors say a mandatory discovery agreement procedure raises litigation costs and delays the parties’ ability to prosecute litigation effectively. Because the meet-and-confer process is conducted early, parties are often unable to determine the most relevant issues. Further, delays in getting past discovery can result in justice denied.

While meet-and-confer conferences have their place, they must be used well. Because litigation is an art, as well as a science, discovery agreements are a function of the effort put into them. Having consulted on hundreds of discovery agreements, I have observed they are only as effective as the willingness and creativity of counsel to use them to strategic advantage. I have been involved in meaningful and tough negotiations that have measurably reduced discovery costs both for my clients and overall.

However, I have also seen parties fail to tailor the model discovery agreements to the requirements of their case. When parties spend weeks concluding such a pro forma agreement, they can justifiably complain about this new step — and even more so when the other side’s productions are unreadable!

Where parties can agree on the material issues to explore during oral discovery, they can use robust preservation provisions, with collection proceeding in a phased way so that review occurs first on the documents deemed most essential to the disposition of issues in the litigation. Using both strong preservation requirements and phased production can, in appropriate circumstances, streamline documentary and oral discovery.

Similarly, attention to search methodology in discovery agreements yields benefits. I often see parties rush to list keywords without taking time to understand the context in which those keywords will operate. One common error is that parties will agree to keywords without understanding whether and how their — or their opponents’ — systems can be searched. Another error is to presume all electronic documents are searchable within their native systems.  They are not. These errors can be costly, as failure in keyword searching can lead to under- and over-inclusion in collected documents. Often, these errors are compounded in developing search terms aimed at e-mail systems. Most e-mail systems are not built to permit keyword searches within attachments (except the subject line); yet most keyword lists are aimed at “discovering” text within attachments. Counsel should discuss the limitations of the information management systems being searched and adapt search strategies and keywords accordingly.

Meet-and-confer conferences can also prevent technical issues from becoming a sideshow, but only if parties discuss those issues before production. Failure to do so can result in unviewable and dropped images, indecipherable descriptions of documents, or surprise costs at a later stage of the litigation.

Counsel often use different software to review and store documents (while some do not use any review software at all, which carries its own challenges for proper documentary exchange). Therefore, counsel should discuss the technical formats for the exchange of electronic documents, as not all load file formats are compatible, and designate a technical contact in order to address such non-legal issues. By identifying what information should be handled by technical experts, rather than counsel, parties can lower costs associated with documentary exchange.

I often see parties failing to consider the format in which they will produce documents, and therefore receiving data of marginal use. For example, while most parties continue to exchange documents in image format (either tiff or pdf), some are opting to exchange certain file formats natively. Excel spreadsheets are frequently produced in native format, as are audio- and video-file formats, and complex graphical formats such as AutoCAD drawings. This is a useful development in many circumstances, as there is better quality information available in the native file format, and exchanging these documents in native format can lower production costs.

Another “technical” issue often overlooked in meet-and-confer conferences is the format, nature, and character of information within Schedule A. Although this information is often specified by practice directions, many no longer strictly conform to how electronic documents are processed and what information can be made available at a low cost. As more parties collect documents electronically, they have the option to exchange extractable metadata rather than hand coding all documents, agree how to treat documents that have no extractable metadata, or hand code only a limited number of documents. For large collections, decisions about what information to hand code into Schedule A can have a big financial impact. I have also seen parties agree to hire a single vendor to code Schedule A-related information (following a privilege and relevance review) by pooling data to lower costs. However, there are limitations to the utility of extractable metadata that counsel should consider.

Other technical items to consider, including in discovery agreements, include: detailing processing instructions, as processing can affect presentation of data; the exchange of exception reports; metadata date stamp and treatment, including the effect of daylight savings time and multiple time zones; and the need for escrow provisions where data is held by third-party service providers. It may be that none of these factors affects that data in your case, but it’s important to think about each one throughout the meet-and-confer process.

Finally, I have seen effective use of stipulations through the meet-and-confer process. In discussing the nature of the parties’ information management systems and the data contained within them, counsel are frequently electing to stipulate information about these systems, particularly where this is not material to the issues in the litigation. Such stipulations can also provide comfort to certifying counsel, particularly where the discovery agreement includes provisions stating that the authenticity and admissibility of electronic evidence is not in issue in the litigation.

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