At a Judge’s Direction in EORHB, Technology-Assisted Review Series Part 6

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Seven years after it first rose to prominence in eDiscovery, technology-assisted review remains an important, and at times controversial, tool in the eDiscovery practitioner’s toolkit

In “Still Crazy after All These Years,” we discussed the slow but steady growth in the importance of TAR.  In “In the Beginning Was da Silva Moore,” we discussed the first case to address TAR.  In “Questions of Choice in Kleen Products,” we discussed an attempt to force the use of TAR, and in “Reported Results in Global Aerospace,” we discussed the first instance of reported TAR results.  In “A Negotiated Protocol in In Re: Actos,” we discussed a successfully negotiated TAR protocol.  In this Part, we review the EORHB case.

The next newsworthy TAR case was EORHB, Inc. v. HOA Holdings LLC (Del. Ch. Oct. 15, 2012), which was “a complex multimillion dollar commercial indemnity dispute” before the Delaware Court of Chancery, the oldest business court and one of the most respected business courts in the country.  The case arose out of the 2011 sale of the Hooters restaurant chain.

On the Judge’s Own Motion

In October 2012, in a hearing in this case, the Judge brought up the subject of technology-assisted review – here referred to as predictive coding – on his own, explained why this is a good case for it, and directed the parties to use it or show cause why they shouldn’t:

The Court: . . .  This seems to me to be an ideal non-expedited case in which the parties would benefit from using predictive coding.  I would like you all, if you do not want to use predictive coding, to show cause why this is not a case where predictive coding is the way to go.

. . .

One thing I don’t want to do – one of the nice things about most of these situations is once people get to the indemnification realm, particularly if you get the business guys involved, they have some interest in working out a number and moving on.  The problem is that these types of indemnification claims can generate a huge amount of document.  That’s why I would really encourage you all, instead of burning lots of hours with people reviewing, it seems to me this is the type of non-expedited case where we could all benefit from some new technology use.  [emphasis added]

Both because this was the first reported instance of a Judge directing the parties to use TAR, and because this occurred in the preeminent business court, this order made news throughout the industry.

For Good Cause Shown

Ultimately, the Defendants agreed to proceed with a TAR approach, and the Plaintiffs successfully showed cause why they should not.  As the Judge explained in the order:

WHEREAS, the parties have agreed that, based on the low volume of relevant documents expected to be produced in discovery by [the Plaintiffs], the cost of using predictive coding assistance would likely be outweighed by any practical benefit of its use

. . .

NOW THEREFORE, this –––– day of May 2013, for good cause shown, it is hereby ORDERED that:

. . .

(iii) Plaintiffs may conduct document review using traditional methods[emphasis added]

Upcoming in this Series

In the next Part of this series, we will review the Biomet case, in which questions of TAR process design and transparency were explored.

About the Author

Matthew Verga

Director of Education

Matthew Verga is an electronic discovery expert proficient at leveraging his legal experience as an attorney, his technical knowledge as a practitioner, and his skills as a communicator to make complex eDiscovery topics accessible to diverse audiences. A fourteen-year industry veteran, Matthew has worked across every phase of the EDRM and at every level from the project trenches to enterprise program design. He leverages this background to produce engaging educational content to empower practitioners at all levels with knowledge they can use to improve their projects, their careers, and their organizations.

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