alt.legal: My Overreaction To Potentially Sane Discovery Policies

What will the impact of "proportional" discovery be on the legal industry?

The $400 billion legal industry — literally, an entire industry made from the practice of law — both enables and obstructs access to justice, especially when it comes to discovery. So when new policies start to change how things are done, everyone gets real nervous. Objectively, we do have to assume positive intent when it comes to legislators and policy makers (quis custodiet ipsos custodes, a principle best portrayed here, IMO). We all know how unbiased Congress is, right?

So what are our objective, reasonable tribunes up to these days? Proportionality in discovery, which is about to become codified in the Federal Rules. The impact?  A ripple effect like you wouldn’t imagine.

Better (?) trial lawyers. Restricted evidence. Advantages for both plaintiff and defense bars. Bolder litigants ready to do battle. Liberty and justice for all. I don’t know, maybe a wormhole that opens near Saturn that can save humanity.

Am I the only one that is jumping out of my skin? No. The principle of proportionality is driven by the massive electronically stored information (i.e., Big Data), and I think that’s a big deal. This federal judge agrees with me, so there.

Now is the part where I offer wild speculation on the impact of “proportional” discovery on the legal industry. Keep reading, nerds…

First, what is proportionality? Currently, Rule 26(b)(2) sets the scope for discovery to be anything “reasonably calculated to lead to the discovery of admissible evidence.” Translation: really super broad. In 1983, the Committee thought they had addressed disproportional discovery by adding a cost-benefit analysis, limiting discovery when the burden or expense outweighs its likely benefit. As it turns out, not really. So the new Rules will instead narrow the scope even more to only discovery “proportional to the needs of the case.” Factors to weigh for proportionality to include:

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  1. the amount in controversy,
  2. the importance of the issues (talk about subjective!),
  3. the parties’ resources,
  4. the importance of the discovery in resolving issues (again, says who?), and
  5. the old cost-benefit test of burden vs. benefit.

Some judges have already started incorporating proportionality into their opinions, and now, the amendments to the Rules will make it the law of the land.

Who benefits more, the defense or plaintiff bar? At first blush, a policy of proportionality may lead defense firms to better defend against overly broad discovery requests. Plaintiff firms can no longer engage in punitive discovery tactics, designed to bend a defendant into settling. But discovery is a veil for both sides sometimes, and if discovery techniques are becoming scalably smarter (through managed services and technology) as well as more focused, it may be that plaintiffs could gain from having more straightforward discovery. Also, proportional discovery doesn’t necessarily mean “less” discovery — proportionality could very well support more discovery when, for instance, a putative class action has hundreds of millions of dollars in potential damages. However, it appears that the plaintiffs’ bar tends to be against the amendments.

What does this mean for Biglaw? Less discovery means a lot of things. For one thing, it means even less large law firm work. We already know that Biglaw growth is nearly flat and the pie for them is shrinking. Instead of throwing more associates at discovery (and throwing more money into partners’ pockets), voluminous document review has already been outsourced to legal services, and advances in legal technology like predictive coding help mitigate the task. Now, with scope limited even further, litigators cannot continue to hide behind massive discovery.

Without a constant fire hose of discovery, what is everyone going to do? Let’s start with alternative legal services. I have always been of the opinion that outsourcing and legal technology are forces that focus discovery to mitigate the crazy growing volumes of data in e-discovery. So the net effect on alternative legal services providers won’t be huge, especially as the industry moves higher up the value chain. In fact, it’s likely that arguments estimating the cost of proportional discovery will include the new normal of legal services costs.

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But chin up, Biglaw — most of that was and will continue to be outsourced anyway. Hustle hard! You can still get that legal spend.

How? More proportional discovery means more legal spend on practice on the merits. Great news, right? Well, being able to write a decent brief is not uncommon, but being able to argue the motion, being able to win at summary judgment, being able to win at trial… these are not skills found quite as widely. And again, that’s true on both sides of the bar. Not to knock all my litigator friends, but be honest, Biglaw litigators: what percentage of your billable hours relate to relatively unimportant, even totally irrelevant, documentary electronic evidence? Are you up to the challenge of being the real litigator, in the business of winning for your clients?

More liberty and justice for all? So less expensive, more focused discovery, leading to more aggressive corporate legal departments and more litigators who try cases. What does that mean for the litigants?

We’ll have to wait and see, I guess. When coupled with the principle of cooperation, the new Rules seem to envision shiny happy people getting to the truth of the matter. But make no mistake: this is a flat-out narrowing of discovery. The number of depositions, the length of oral depositions, the number of interrogatories, and a limit to requests for admission… the amendments propose for all of them to be reduced. Is less discovery good for individual claimants or civil rights groups? Generally, no.

While the hope is that litigation will move towards the merits, it’s entirely possible that “proportional” discovery means evidence getting missed and defendants clamming up on the scope of what they collect. I believe a more transparent and robust market of cost-efficient discovery options will prevent the defense bar from taking advantage of narrower discovery and hold them accountable without too much wasted energy on both sides.

I mean, that’s the goal, anyway. I’m probably overreacting.


Ed Sohn is a Global Director at Thomson Reuters’ award-winning legal outsourcing company, Pangea3, which employs approximately 1,000 full-time attorneys globally. After five and a half years as a Biglaw litigation associate, Ed spent over two years in New Delhi, India, managing hundreds of Indian attorneys and professionals in delivering high-value managed legal services. He now focuses on developing integrated technology and outsourced legal solutions. You can contact Ed about e-discovery, managed legal services, theology, chess, Star Trek The Next Generation, or the Chicago Bulls at edward.sohn@thomsonreuters.com.

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