As corporate counsel, you have important matters to contend with every day. You likely feel like there’s never enough time to manage everything. On top of that, you shoulder the burden of issuing, executing, and ensuring compliance with legal holds in the event of anticipated litigation, regulatory request responses, internal investigations, and due diligence activities.

The consequences of noncompliance can be severe. Failing to adequately preserve electronically stored information (ESI) for eDiscovery can cause irreversible damage including crippling legal sanctions. This is why it is critical that you master the proper execution of legal holds.

Unfortunately, the legal hold process can feel daunting and cumbersome. Instead of guiding corporate strategy and advising on directional growth opportunities, you spend time and energy: 

• Hounding unresponsive custodians
• Monitoring overlapping legal holds in multiple cases
• Updating spreadsheets to track custodians
• Communicating with IT to ensure the preservation of relevant data
• Stressing over missing data
• Worrying about the defensibility of your legal hold process

But there’s good news. While implementing legal holds requires preparation, the right legal hold software can lighten your workload, giving you time to focus on high-value strategic matters.

Here’s what you need to know about legal holds and legal hold software. 

Contents: 

Creating a defensible legal hold process
Implementing a legal hold
Sourcing appropriate legal hold technology
Seven things to look for in a legal hold solution
1. Is it secure?
2. Can it automate communications?
3. Is it user-friendly?
4. Can it track responsiveness?
5. Can it, where necessary, preserve data by collecting and uploading it seamlessly?
6. Does it create an audit trail?
7. Does it come with training and support?

Let's dive in!

Creating a defensible legal hold process 

A legal hold (also known as a litigation hold) directs employees to preserve certain records and information that may be relevant to a pending or anticipated lawsuit or investigation. The duty to preserve information dictates that information not be modified, destroyed, or deleted. Any of these could lead to the permanent loss of data, which is commonly referred to as “spoliation.” The duty to preserve information extends to both physical evidence such as paper documents and all forms of ESI. 

Spoliation can easily result in eDiscovery sanctions. In 2003, Judge Shira Scheindlin penned the seminal decision in Zubulake v. UBS Warburg IV, which has become black-letter law regarding legal holds. Judge Scheindlin wrote, “Once a party reasonably anticipates litigation, it must suspend its routine document retention/destruction policy and put in place a ‘litigation hold’ to ensure the preservation of relevant documents.” 

Federal Rule of Civil Procedure 37(e) gives the courts the authority to penalize parties for allowing or causing the spoliation of discoverable information. Under Rule 37(e), if the loss of ESI harms a party, the court can order curative measures. But, regardless of harm, if the court determines that a party intentionally destroyed discoverable information, it may instruct the jury that it should assume the evidence was unfavorable to the party that destroyed it. This adverse inference instruction could have a devastating effect on the outcome of the case. Moreover, the court may go further, dismissing the action or ordering a default judgment as a sanction for intentional spoliation. 

A legal hold is the first line of defense to protect your organization against possible spoliation of evidence and attendant sanctions. 

Implementing a legal hold 

Organizations need to engage in significant planning to craft defensible legal holds. Law departments must establish a legal hold process that they can implement quickly and consistently because time is of the essence when litigation is anticipated.

The first step to defensible legal holds is to implement a data retention policy and practice good data hygiene. A retention policy enables organizations to minimize the amount of data they hold—and the less data you have, the less you need to worry about preserving.

Next, be sure to act quickly. Once litigation is reasonably anticipated, you must send out a legal hold notice and suspend your routine data retention policies. The legal department sends the legal hold order to individuals who may have relevant data (the “data custodians”), directing them to maintain their data from that moment forward. Suffice it to say, it’s the implementation where things get thorny.

Unfortunately, you can’t assume that data custodians will promptly see your legal hold and take the necessary action. To create a defensible process that will withstand judicial scrutiny, you’ll want to have data custodians acknowledge their receipt and compliance of the hold—and you’ll want to deal proactively with any unresponsiveness.

Lifting a legal hold is almost as important as implementing it. When you’re confident that the matter has concluded, communicate clearly and precisely how to lift the legal hold and reinstate your standard data retention policy. It sounds easy, but this is where you earn your keep. The devil is in the details.

There are many excellent resources for more information about legal holds, including the Sedona Conference Commentary on Legal Holds and our white paper, The Ultimate Guide to Defensible Legal Holds. 

Sourcing appropriate legal hold technology 

Legal hold software solutions can simplify this process. They can automate routine tasks, minimize your manual work, and help you manage the legal hold process strategically and defensibly. Legal hold software creates efficiencies in: 

• Issuing holds
• Interviewing custodians
• Preserving relevant information
• Sending out automatic reminders and notifications
• Monitoring compliance
• Creating thorough tracking and audit trail reporting

The right legal hold software can make a massive difference in the implementation and defensibility of your legal hold process. 

Seven things to look for in a legal hold solution 

As you consider potential legal hold solutions, evaluate their suitability by asking these seven questions. 

1. Is it secure? 

Security is paramount in the legal hold process. Before you entrust any software provider with your organization’s data, do your due diligence. You’ll want to get the go-ahead from the IT department for your software of choice. Make their work easier by ensuring that the solution you’re considering features end-to-end encryption, two-factor authentication, customer isolation through network security, permission-based user and access roles, and virus scanning and malware detection measures. 

2. Can it automate communications? 

Your ideal solution will automate and manage communications with any number of custodians across multiple cases. Templated messaging (emails), questionnaires, and scheduled automatic reminders make communication seamless, thus saving time and mitigating risk. 

3. Is it user-friendly? 

An easy-to-use, intuitive interface means everyone will feel comfortable using the software, which increases the odds of full software adoption. This goes a long way to ensuring custodian responsiveness and compliance, as custodians will know what is expected of them and will know how to comply. 

4. Can it track responsiveness? 

You’ll want reporting functionality that shows which custodians have responded to your hold requests and tracks the number of holds per custodian and holds per attorney, as well as the overall status of all legal holds. You want to be able to see the big picture at a glance so you can escalate and address any noncompliance. 

5. Can it, where necessary, preserve data by collecting and uploading it seamlessly? 

Data comes in a vast range of formats from various repositories and systems. You need a legal hold solution that can preserve data in place in all imaginable file formats. Where in-place preservation isn’t possible, you’ll want the ability to collect data easily and quickly. This means you’ll want direct connectivity with various online repositories, including Microsoft 365, Google Workspace, and social media, with drag-and-drop uploading and cloud uploading for Microsoft Exchange and Google Gmail.

6. Does it create an audit trail? 

If an opponent should challenge your preservation of ESI, the best way to demonstrate the defensibility of your legal hold process is through a complete and accurate audit trail. Make sure that any software you’re considering for legal holds can create full audit trails that show when you implemented a hold, issued hold notices to custodians, sent reminders, and more. 

7. Does it come with training and support? 

Even the fanciest features are no good if the software you’ve chosen crashes or is hard for your team to use. The best legal hold software comes with complete onboarding support and ongoing training, customer support, and technical assistance. 

Why you need a smart legal hold solution 

Smart legal hold solutions can ease the burden of managing multiple and voluminous preservation matters, improve the defensibility of your preservation efforts, and free up your valuable time for more strategic work. 

[View source.]