I referred in my last post (see The Last Lap) to the law firms which lie below the very biggest and which have the potential to be the standard-bearers for a new approach to managing litigation. Many of their lawyers have come from the big firms, with all that that brings in terms of skills. They have a lower cost-base which goes through into their charging rates. They have the quality of work, the incentive in practice development terms and the flexibility to adapt to new ways of working. One of the factors which distinguishes them from the city giants is that they do not have large teams of people to allocate to heavy e-disclosure jobs which means that they must either find other ways to handle large volumes or avoid document-heavy cases (they could just do them badly or unprofitably, of course).
The majority of their lawyers’ case-loads are not big budget ones with hundreds of thousands of documents, so they have not seen the need or opportunity to develop either a process or the skills to manage a large electronic disclosure exercise. They do have such cases, however, and another could turn up tomorrow, particularly as clients shop around to make their litigation budgets go further.
I am hearing from an increasing number of such firms – all names which you would know in a litigation context and which, despite variations in size and specialisation, have much in common in terms of the civil litigation work which they do. Most of them lie in the top 100, with one or two of them in the range 100 to 200 as defined by The Lawyer. Their Lawyer ranking does not necessarily define the size of the litigation which they handle. Their motivation for showing interest in e-disclosure varies: sometimes it comes with a particular matter in which they are instructed; they may have missed the cases which are reported as significant (Digicel v Cable & Wireless or Earles v Barclays Bank for example), but they may have seen the ones which attracted publicity in the press (Shoesmith v Haringey, Ofsted and the Secretary of State for Education, the OFT’s withdrawal of its price-fixing prosecution against BA and Virgin) which point up the risk of getting it wrong; they may have heard of the pending practice direction and electronic documents questionnaire and of Master Whitaker’s judgment in Goodale v the Ministry of Justice; they may sense a practice development opportunity.
In the last few weeks, this group has seen Halliwells (No 25) crash and burn whilst Shoosmiths (No 28) reported a profits increase of 70% on a 9% fall in income. If neither of these is representative of a trend, these extremes show that anything is possible. If fear of failure (whether on a grand scale like Halliwell’s or by having an ignominious role in a judgment) is not a sufficiently compelling motive, then Shoosmiths’ experience suggests that there is money to be made by a different approach to handling the work. Profit per case is not the only measure here; a visible commitment to reducing costs helps firms retain clients and win new ones, always a more attractive proposition for lawyers than merely hearing suggestions for reducing their billable hours. For a government department, the obligation to do more for less has become extreme; most of their litigation is not optional, much of it is substantial, and public bodies have had more than their share of the very public disclosure failures.
The motivation therefore falls into two broad categories – risk avoidance and increased efficiency. The main development at the moment, however, is the pending e-disclosure practice direction and electronic documents questionnaire and it was that, I think, which led to an invitation from Nigel Murray of Trilantic to go with him and speak to a London firm on Friday. My role was to talk about the background to the practice direction and questionnaire and its implications for lawyers. The most important message (and one on which I will be expanding in a future article) is that the carefully-drafted wording of the practice direction will ensure that completion of the questionnaire will only be required in cases where that is appropriate. My theme, familiar to those who come here often, is that better information makes proportionate decisions possible – you cannot decide to limit custodians, date ranges or whatever until you have some idea of what the totality is, what the value might be of any components, and what the costs are of extracting data from any one source. That is a very different approach from either just disclosing everything which might be considered disclosable or overlooking sources altogether, neither of which accords with the the rules or the clients’ objectives. The questionnaire is an aid to such thinking in an appropriate case. The skill of both the lawyers and the judges lies in deciding which cases will benefit from use of the questionnaire and which will not.
Nigel Murray took up the theme at the next stage on from there. Having identified sources worth collecting from and captured them, what is the fastest and most cost-effective way of sorting the sheep from the goats, that is, the relevant from the irrelevant? Everything else, including the major expense of review, follows from those choices.
This is what Equivio>Relevance is designed to do. Nigel explained how Equivio>Relevance takes input from a senior lawyer who looks at successive batches of documents, each refined by reference to decisions already made, until the system is ready to rank documents by a relevance score derived from the lawyers’ input. That ranking can be imported into a review tool along with other information about documents and used to decide what seniority of lawyer is applied to which categories of documents in what order. In Nigel’s example, the reviewable volume was reduced by 60%. Given the review cost per document, that represented a significant saving – and if that has the most impact over very large volumes of documents, it was not to be sneezed at in relation to smaller volumes. There are, of course, cases too small to warrant such attention, but the threshold is much lower than one thinks. The only way to find out what the costs and potential savings are is to do the sums in advance. If your quotation for disclosure is £X and your rivals can do it for 60% of £X then the clients will know where to go, whatever the value of X.
Inevitably, and rightly, a questioner wanted to know how he could satisfy himself that he had fulfilled his duties by using such software to make so big a reduction in the volumes. If part of the answer to this lies in the close lawyer input at the outset, another major component is the ability to review the output and to take samples from both those categorised as relevant and those discarded as irrelevant. If sampling suggested that an error had been made one way or the other, then the inputs could be adjusted.
Another question was on a point which is easily overlooked as we hasten to explain the benefits of culling and filtering. How do you start? You are instructed on a new matter and realise that you need to look at electronic documents; how do they get from the clients’ systems and into yours? The short answer is that every firm ought to have relationships with at least two companies whose business includes the collection of electronic documents. The slightly longer answer is that there is a set of skills involved which enable the lawyer to engage in discussions with the client, immediately if that is appropriate, and to identify what sources exist which might possibly be relevant. Even in a case where the questionnaire is unlikely to be imposed under the new practice direction, it acts as a good check-list for those discussions.
I am always keen to take opportunities such as this, whether in tandem with a technology provider or not. Professor Dominic Regan and I, with Senior Master Whitaker when he can, will be doing more of the sessions which the three of us did in London and which Dominic and I did in Liverpool. They might be at law firms, in government departments or in public events – all have been under discussion today with a view to fixing Autumn dates.
Quite apart from anything else, such invitations give an opportunity to find out what the perceived issues are at these places. I use the word “perceived” deliberately, because quite a lot of them come down to things which are easily clarified and which, once understood, are usually less expensive than one might imagine. Imagination is not a valuable component in an assessment of cost and proportionality, and no substitute for facts.