Disclosure of documents in disputes and regulatory investigations is hugely time consuming and capable of giving rise to inefficiencies and costly errors. The example of Atheer Telecom Iraq Ltd v Orascom Telecom Iraq Ltd [2014] underlines the importance of ensuring that disclosure is carried out in a structured, recorded and defensible manner. Disclosure may seem administrative and even dull, but getting it wrong can hit you hard.
The cost of cutting corners
Giving disclosure can be expensive, particularly if the data set is large or the exercise is not effectively project managed. However, disclosure risk can be exacerbated if data collation and review is not carefully documented and it is later scrutinised by the other side or the Court. There is much to think about in the post-Jackson world of disclosure: completing Disclosure Reports; providing EDQs; budgeting disclosure costs accurately; making an appropriate choice from new 'menu' of disclosure options (often all before document review has even started).
Few companies are willing to pay for a gold plated service. So it is not surprising that, in seeking to do the job economically, one thing that often gets overlooked is the benefit of ensuring that the disclosure process itself is clearly structured, well recorded and forensically defensible. However, unless it is, the whole case can be fatally weakened.
Atheer v Orascom: a cautionary tale
Atheer had given standard disclosure and had certified that it had carried out reasonable searches for all relevant documents in its possession or control. Atheer gave no further information about what those searches were. Following Orascom expressing concerns about Atheer's disclosure, the Court ordered Atheer to file and serve an 'organogram' identifying the relevant departments in its company, the relevant individuals within those departments, what sources of documents had been searched and how.
From recent experience, judges are now showing an increasing willingness to make orders of this sort (and not just in the TCC). So it pays to maintain a clear and accurate picture of the processes undertaken. Providing disclosure to the required standard may not be enough if under scrutiny you cannot convince the court you have met that standard. Equally, being able to explain and justify your disclosure process when questioned may see off an application for further or specific disclosure.
Conclusions
Keeping track of the disclosure process can be complex. Properly done that process should be managed using an effective and appropriate system which is based upon an early assessment of the necessary scope of review, proper engagement of technical solutions and ongoing monitoring/reporting on quality, documents and emerging costs. Part of that project management should include details and a record of how documents were located and identified and what decisions were taken about why certain documents or categories were excluded. Such questions arise regularly in any complex document recovery process.
An organisation may be based across several sites. It may have gone through IT migrations or mergers. It may operate legacy systems alongside new IT infrastructure. There may be active servers, archive servers and back-up tapes. There may be complex IT architecture of shared drives, individual spaces and restricted access areas. The difficulties of such structures and the legal decisions taken on how to conduct a proportionate search of them are compelling reasons to keep track of exactly what has been searched and how.
Judges are getting savvy and apparent complexity is unlikely to be accepted as a valid excuse if you cannot demonstrate how you have performed reasonable searches. You need to be ready to justify the process: why certain locations were excluded, why some spaces were searched by keyword, why some had to be manually reviewed.
How much of that information you chose to divulge in a Disclosure Report, List of Documents or in correspondence may be a tactical decision. However, both senior finance colleagues and the Judge are likely to be unimpressed if excessive costs are incurred in retracing the disclosure process. If the Court orders preparation a witness statement explaining the full extent of your searches, are you prepared to comply?
The author Lloyd Nail is a member of Burges Salmon's commercial disputes team working with Chris Jackson who regularly leads project teams on large scale disputes to deliver efficient outcomes for commercial clients.