The Cross-Border eDiscovery Challenge & The Possible Accountable Systems Solution

Posted by K Krasnow Waterman on Thu, Jun 18, 2009 @ 13:06 PM
Cross-border eDiscovery is a hot topic this year. The decreased cost of storage has resulted in nearly everyone retaining massively greater quantities of information. Email and the Web have driven a shift in data to less formal, less structured records and files. And, globalization of business has caused the relevant information for an increasing number of lawsuits to be spread among multiple countries. Courts have instituted new rules for how parites will engage in discovery related to this digital evidence. And, these new rules are putting some lawyers in the cross-hairs of other governmental digital control activities. Lawyers, by and large, are not technologists and the challenges arising from handling this mass of distributed data are proving daunting. Technology vendors are offering significant assistance but still more is required.

Discovery, at its simplest, is the concept that one party to a lawsuit can learn what the opposing party knows that is relevant to the resolution of the case. In the US, this had long been accomplished through gamesmanship and strategy (think, hide-and-seek meets go-fish) while, for example, the UK had moved on to affirmative disclosure, the idea that each side needs to identify the truly relevant and provide it. In either case, the parties have needed to decide what data to preserve and how to search it. For a variety of reasons, corporations are adding and deleting data all the time -- doing things like updating client or supplier addresses, changing prices, adding sales, marking deliveries. So, typically, one needs to select a moment in time that's relevant to the issues in a lawsuit and look at all data from that time or up until that time. This is no easy task, as the challenges of selecting the moment, deciding how to save the data, and which tools will provide the best search result are all subject to debate.

Handling a case that involves data in multiple countries compounds the challenge. The EU has had detailed and tightly controlling rules about the handling of information about people by commercial entities for nearly thirty years. By comparison, the US historically has had a comparatively limited concern about the privacy of people whose identities appear in commercial files. For example, in many cases EU rules prohibit making the sort of "moment in time" copy of entire systems described in the last paragraph and have rules that as a practical matter prohibit sending data about people out of the country. Recently, these rules have come into head-on conflict with courts in the US requiring that certain information be turned over in discovery. The decision not to violate the EU rules has resulted in some significant financial penalties being imposed by US judges, while the decision to violate the EU rules and provide the data in the US has resulted in some equally significant financial penalties being imposed by European judges, leaving litigators between a rock and a hard place.

Much discussion is ongoing about ways to resolve this problem. For example, governmental, public policy, and commercial bodies are discussing possible changes to their rules. New forms of insurance may be offered to indemnify parties caught in the current situation. At the same time, there is a quiet march forward of new technologies which may resolve some of the issues. For example, systems that track each data transaction at a very granular level and account for their compliance with rules, called "accountable systems", are in development. Such systems would make it possible to understand the data in the system at a particular moment in time without requiring a "copy" to be made. And, they would be able to recognize competing data rules and apply the correct ones, wherever the resolution of a rules conflict is possible.  In theory, this technology might also make it possible to transfer the substantive portions of the information without the personal information, so that the parties could define very small subsets that are relevant and actually required to be disclosed, thus limiting the release of personal information to subsets so small that requirements, like notice to the individuals in the data, could reasonably be met.

While this new type of technology offers promise for resolving some of the cross-border eDiscovery challenges without requiring any jurisdiction to change its rules, it has drawn relatively little attention in this context to date.  Perhaps this is because the technology needs to be refined and then implemented in the day-to-day digital business practices of organizations before it can be capitalized upon to address this issue.  How long it will be before this occurs will be driven by how quickly people recognize the problems this technology can solve.

Topics: access control, technology implementing law, privacy technology, technology for lawyers, accountability, knowledge discovery for litigation, information management, data protection, digital evidence, technology for business managers, global outsourcing, information security, digital rights, privacy, eDiscovery, forensics