Skyrocketing Costs and the Impact of E-Discovery

Skyrocketing Costs and the Impact of E-Discovery


The pain of electronic discovery continues to impact both the top and bottom lines for companies. Consider:

  • Studies indicate that nine out of 10 U.S. companies are pulled into lawsuits.
  • On average, an organization can spend more than 70 percent of its entire legal budget on litigation and regulatory actions.
  • In a lawsuit, the discovery phase alone can represent more than 50 percent of the total litigation costs, with e-discovery consuming over half of that budget.

As economic and market constraints intensify, exposure to litigation and investigations increases. Furthermore, courts continue to hold organizations accountable for how they handle (or mishandle) document productions. There have been multiple instances where a single failure of legal discovery compromised a company’s legal position, undermining its cost savings and compliance efforts. However, despite these significant expenditures and growing risks, six out of 10 organizations have no formal program in place to manage their legal discovery risks effectively.

Challenges and Opportunities

The cost of compliance as well as the serious consequences of noncompliance are growing substantially. Recent court cases show that many organizations continue to struggle with demonstrating good faith efforts and reasonable practices when compelled to preserve and produce potentially relevant and responsive information. The result has been serious sanctions and, in some cases, presumption of wrongdoing by the party unable to comply properly with requests for discovery.

Although companies cannot avoid or defer e-discovery requirements, there are immediate opportunities not only to better manage the risks, but also to realize positive hard-dollar returns.

Our Point of View

Companies should seek and demand a better answer to their e-discovery needs.

  • E-discovery is a business process, not a product or a project.
  • Litigation readiness does not always translate to effectiveness – just taking a more proactive approach is not enough to meet growing demands.
  • Best practices are not always required. In certain cases, they may result in setting standards and expectations too high, overspending (particularly with IT solutions) and unanticipated operational demands.
  • Current market trends and technology advancements offer considerable opportunities to address the risks and challenges of e-discovery effectively.
  • Companies that are tired of explanations (or excuses) for discovery lapses and are serious about addressing the exorbitant costs and unpleasant surprises related to e-discovery need to get beyond the “who, what and why” and focus on the “how, here and now.”

From a risk management perspective, improving current business processes by embedding e-discovery capabilities and capacity (rather than vice versa) not only eliminates significant time and cost burdens, but also creates value for organizations through better effectiveness, efficiency and risk reduction.

How We Help Companies Succeed

We help organizations set and sustain the right capabilities and capacity in-house. Protiviti delivers the necessary e-discovery and process expertise to make your existing investments in technologies, people and methodologies work. Protiviti’s focus on process integration and risk management not only provides immediate and direct benefit to bottom-line costs, but also delivers dependable and defensible results. We offer our global services in a full spectrum, from event-driven to process-driven environments.

  • In response to litigation: Getting ahead by reducing costs and consequences – When faced with a lawsuit or regulatory action, the ability to respond quickly and decisively is critical to protecting enterprise value. From the outset, our certified e-discovery specialists provide just-in-time resources with deep, relevant skills to the aspects of the e-discovery process that cause the most surprises – namely, the proper identification, preservation and collection of data. Working with in-house and outside counsel, Protiviti can help establish and execute:
    • Litigation and incident response
    • E-discovery strategies (defense and offense)
    • ESI metrics and metadata analysis
    • Methodology to identify, preserve, collect, analyze, process and produce ESI
    • Document review protocols and staffing
    • On-demand e-discovery process and project management
    • Discovery response certification
    • Requirements for expert testifying services
  • Process-driven: Staying ahead by driving sustainability – The ability to sustain improvements in business processes is critical to enhancing enterprise value. Establishing defensible processes in routine operations goes beyond responding to e-discovery demands on a project or event-driven basis. Organizations need to get risk management, controls and compliance right.

Protiviti helps organizations institute a systematic and disciplined approach to evaluate and improve their e-discovery capabilities. Our global team of professionals brings the necessary mix of industry and subject-matter experience, compliance and governance expertise, and technology skills that are critical to driving sustainability. Working with key business units and stakeholders, Protiviti can help evaluate and implement:

  • Discovery risk management program
  • Litigation readiness and effectiveness program
  • E-discovery readiness and effectiveness program
  • E-discovery technology and process integration
  • In-house, co-sourced and outsourced e-discovery functions
  • Records retention and disposition programs
  • Data security and governance programs
  • Incident response program
  • Ongoing compliance monitoring, training and change management programs
  • High-value audits (e-discovery and records retention)

Our integrated risk solutions in e-discovery help you identify, prioritize and manage risks so that you can enhance performance and, ultimately, business value.


Frank H. Wu
Jonathan Wyatt (London)

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