E-discovery costs are high for the unprepared
Once local governments are notified that a lawsuit might be filed against them, or if they reasonably anticipate litigation, they are required by federal law to preserve all documents and electronic data that pertains to the case in a “litigation hold.” The process for gathering electronic data, known as “e-discovery,” is complex and costly, so experts say cities and counties should create e-discovery plans in advance because poor preparation could add to the expense.
E-discovery can be a protracted and expensive process, says Stephen Craig, former assistant chief counsel for Phoenix. A moderately sized litigation hold for common lawsuits, such as police action and employment cases, might involve about one terabyte of data and could cost at least $500,000, Craig says. The costliest part of a litigation hold is contracting with a third-party vendor to store the information, and that cost depends on the amount of data.
E-discovery plans should first involve the creation of a response team comprised of IT, legal and departmental representatives, Craig says. After determining whether litigation is actually likely, the team must decide what information must be preserved. He recommends requesting very specific information from the party filing the complaint to avoid spending money saving unrelated data.
The likelihood that a city or county is planning for e-discovery depends on its size and sophistication, as well as its level of involvement in litigation, says Washington-based International Municipal Lawyers Association (IMLA) Executive Director Chuck Thompson. “Some of the larger cities that are more litigious are probably already being forced to recognize the [need to plan ahead for e-discovery],” he says.
