Feb 03
The costs of preserving, searching and reviewing information in litigation can be staggering. What costs a dollar to store on a hard drive can easily cost hundreds of thousands of dollars to search and review for a lawsuit. Ignoring or destroying salient information prior to or during a lawsuit can lead to losing a case—regardless of the merits of the actual claim—and spending a small fortune litigating the issue of whether you have met your discovery obligations. The solution? Take steps to budget, hire and manage information properly on the front end; corral discovery costs; and avoid Luddite lawyers.

A bevy of published articles bemoan the escalating costs of discovery — the process during litigation in which the parties are required to exchange information. Given the informational nature of discovery, the CIO should help effectively manage information and control the associated costs.

The discovery process can be obscenely expensive if you and your data are not ready for it. Your company can spend handsomely on legal and vendor costs to muck through the preservation, search, review and production of vast swaths of electronically stored information (and occasionally spending a fortune litigating the issue of whether your company correctly preserved, searched, reviewed, and produced information). Reported cases and legal periodicals are full of horror stories of discovery costs run amok—such as more than $6 million spent to comply with a third-party subpoena in the In re Fannie Mae Securities Litigation case.

So, how do you help your company avoid hemorrhaging money on discovery costs?

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