Technology
has made it easier and easier to store incredible amounts of information
indefinitely, with instant online backups and seemingly endless storage capacities. With all of this added data comes the risk of
enormous costs to review and produce documents if a lawsuit should ever
arise. In litigation, parties typically request
and often obtain a wide range of documents, including years of financial
records, emails, and other files, in both paper and electronic form. Companies
with years of backup tapes are often shocked to learn the costs just to restore
those tapes – before even reviewing them – could be in the tens or hundreds of thousands
of dollars.
The need to
maintain key company documents has to be balanced against costs of storage,
review, and production, as well as the possible harm in a lawsuit. The time to act is before any litigation is
imminent, because the obligation to preserve all potentially relevant documents
prevents any file deletion once a dispute arises.
Companies
use many techniques to reduce their information overload: automatically deleting emails after a certain
time, limiting the storage capacity for each employee, requiring regular review
and destruction of outdated files, and others.
There is no single approach that works for every firm, so managers, I.T.
staff, and counsel should work together to tailor the best solution.
Your lawyer
should review your company’s technology and backup policies to ensure that the
company keeps what it really needs for business and compliance purposes and then
filters out the rest. Doing so can save
a great deal in storage costs now and potentially much more in litigation costs
and headaches later on.
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