A multi-part series on achieving effective legal holds, including relevant case law, content to include, processes to employ, best practices to follow, available tools to leverage, and more
In the first Part of this series, we reviewed an assortment of recent cases illustrating the potential dangers associated with ineffective or nonexistent legal holds. In the second Part, we reviewed the duty of preservation and the triggers to that duty and hold issuance. In the third Part, we reviewed the standard elements of an effective legal hold. In the fourth Part, we reviewed the importance of defined hold processes and policies and the first two legal activities that benefit from them. In this Part, we turn our attention to the remaining three activities: recipient identification, compliance monitoring, and hold release.
The next activity for which a repeatable process is essential is the identification of the appropriate hold recipients. Even a timely and well-written hold will not be effective if it does not reach everyone it needs to reach. So, who does it need to reach? Does it need to go to the entire company? To a particular department? To specific individuals? What about executive management? Who is responsible for relevant enterprise information systems? Are there outside, third-party recipients that need to be added too?
Since Zubulake V in 2004, the phrase “key players” has been used to describe the essential recipients of a legal hold within an organization. Key players are those with the direct knowledge of the underlying events or those most likely to have relevant information or materials. This is often, but not always, managers and executives. Even plant-level employees have been deemed key players when they had relevant knowledge.
It is not always possible to identify all key players in the abstract; you will need to communicate with some or all of the key players and ask for referrals to others. Depending on the sequence of events, this may mean sending the hold to additional recipients after the initial distribution, as you learn new details. Other common pitfalls include:
Ongoing compliance monitoring after hold issuance is the activity for which it is most important to have a consistent, documented process. As made clear in case after case, failure to check if individuals are actually complying or to remind them as needed can be just as consequential as failing to issue the hold in the first place. See e.g. Pension Committee of the University of Montreal Pension Plan v. Banc of America Securities, LLC, Case No. 05 Civ. 9016 (S.D.N.Y. Jan 15, 2010); Chin v. Port Authority, Nos. 10-1904-cv(L), 10-2031-cv(XAP) (2d Cir. July 10, 2012).
Common steps to ensure ongoing compliance with the hold include:
As we noted in Part 1, a legal hold is not itself preservation, and if it is not followed by the other steps necessary to ensure actual preservation takes place – like ongoing compliance monitoring, then whether or not a hold was issued doesn’t really matter.
Finally, it is valuable to have a standardized process, documented in a policy, for the release of legal holds after a matter has concluded. The Sedona Conference Commentary on Legal Holds includes this in Guideline 11:
Any legal hold policy, procedure, or practice should include provisions for releasing the hold upon the termination of the matter at issue so that the organization can adhere to policies for managing information through its useful lifecycle in the absence of a legal hold.
Having a consistent standard and a defined process for the review of when to release a legal hold can do a lot to demonstrate good faith in your preservation efforts. The three key factors to consider before deciding to release a legal hold are:
If there are no applicable orders, no reasonably foreseeable future litigation, and no reason to preserve for other matters, then a hold can be released and an organization can revert to its default management, retention, destruction, and recycling policies for documents and devices.
Upcoming in this Series
In the next Part of this series, Tools You Can Use for Legal Holds, we will review some of the tools you can use for the execution of these legal hold activities.