OK people, this is probably the last post before the Christmas/New Year break (as we call it in the UK – for our North American readers Happy Holidays and for our German readers, enjoy the 'Silent Season') so seasons greetings to everyone. If there are any breaking news stories between now and 2009, you can be certain we will see them reported here first.

In the meantime, here is a quick catch-up of random news & developments – both serious, less serious and downright frivolous...

• Oracle (yes, this is the first time in several years that we've heard them taking a direct interest in the legal vertical market) have published a new white paper on electronic data discovery – a copy of the white paper is attached. We also hope to have news in the New Year about SAP's activities.

• We're hearing suggestions about a new legal tech networking event that could replace some of the present conferences and events – more news on that in 2009.

• We're planning a further extension of our news coverage in 2009 – so you shouldn't need to go anywhere else for legal IT news than the Insider/Orange Rag stable of publications.

• If someone buys you an Amazon Kindle for Christmas (OK, this is for American readers as the Kindle is unlikely to become widely available in the UK until the spring) and you are wondering what to do with it – well worry no more as you can subscribe to and read the Orange Rag blog on a Kindle.

• Finally, we've been asked by some horizontally challenged legal ITers if we could encourage them in their slimming activities. More than happy to do so – let's call it the Orange Rag dIeT – and we'll devise some prizes (not boxes of chocolates) for those of you who make the biggest impact on your BMIs over a six month period. We think dieting is an excellent idea – not only does some moderate weight loss do you good – but you also then need to buy replacement clothes in a smaller size, which is going to benefit the wider economy. (Well perhaps it doesn't benefit the restaurants you no longer visit but two out of three ain't bad.)


Happy Holidays, Christmas, Silent Season or whatever festivities you celebrate at this time of the year – and that includes you pagans who celebrated the Yule winter solistice yesterday.

The December edition of the Legal Technology Insider newsletter (issue 215) is now out. The digital version hit desktops during the past 15 minutes and the hard copy version will be arriving (subject to the Christmas post) from Thursday onwards.

Top stories include two pieces on the rise of 'cloud computing' plus the results of the latest readers poll – Reasons to be Fearful. We started out by asking whether firms had significantly amended their IT strategies since 1st September 2008. 35.5% of those responding said ‘yes’ they had – the remainder said ‘no,’ which means they are either oblivious to the recession or else revised their plans earlier this year. There again 58.1% of those responding said they had postponed, delayed or deferred IT projects since 1st September; 36% said they had cancelled IT projects; and, 60% said they had delayed, postponed, deferred or cancelled decisions on future IT procurement projects.

On an even more sombre note, nearly one third of respondents (32.3%) said they had already made IT staff related redundancies and lay-offs since 1st September and 41.9% were actively considering lay-offs. In other words, we could be seeing IT related job losses in nearly three quarters (74.2%) of law firms over the next few months.

In total, a mere 35.5% of firms said their current IT procurement plans were continuing unchanged – which suggests 2009 could be a very lean year for the legal IT industry. Asked why, 12.9% cited difficulties is securing credit to fund IT projects; 22.6% said they were reluctant to be seen spending money on IT at a time when they were laying off staff; and, 77.4% their prime motivation for cutting back on IT was continuing uncertainty about the economy and its impact on their firms’ business.

Commenting on the company's performance this year, Aderant's president & CEO Michael Kohlsdorf said "the outstanding performance in 2008 sets the stage for the introduction in early 2009 of the next-generation of the company's business management application suite – the Aderant Expert Golden Gate Release." This new release will leverage Microsoft .NET Framework 3.5 technologies, including Windows Workflow Foundation, to deliver workflow-enabled file opening and enhanced time entry capabilities as well as provide users with contextual access to tasks, information, and collaboration tools.

"Aderant is taking advantage of Windows Workflow Foundation and other Microsoft .NET Framework technologies in the Golden Gate release of Aderant Expert, which can deliver strong business solutions to Microsoft customers around the world," said Paul Andrew, senior product manager for Microsoft. "We are confident Aderant's incorporation of Microsoft .NET technologies can provide organisations with even more cutting-edge functionality and capabilities while potentially lowering their costs."

"There is no doubt that we have made great strides in 2008," added Kohlsdorf. "We remain committed to providing the best products, services, and support to our clients and this commitment will continue to drive our organisation in 2009."

High-end international legal, tax and strategy consulting firm, Nishith Desai Associates, based in Mumbai, Bangalore and Palo Alto, has successfully gone live with 3E, the next-generation financial and practice management software system from Elite. Milind Mundankar, chief technology officer at Nishith Desai Associates, said  “The firm had been successfully billing clients using a legacy system for the past ten years. We were looking for a system that would centralise the time billing and accounting functions and that offered inbuilt conflict check and pending collection modules. Most impressive was the way in which the implementation was handled by Elite. The transition was smooth with minimal disruption to fee-earners and, since go-live earlier this month, a number of valuable training programs have already been successfully completed by Elite.”

• Nishith Desai Associates specialises in cross-border transactional work with a focus on the financial services, IT and telecom, pharma and life sciences, media and entertainment, and infrastructure sectors. Key practice areas include international finance and tax, corporate and securities, intellectual property as well as litigation and dispute resolution. The firm practices Indian law from its overseas offices in co-operation with local law firms in a wide variety of jurisdictions.

by Tracey Stretton, legal consultant, Kroll Ontrack

The economic downturn has damaged corporate performance and as a consequence companies are more carefully analysing expenses as budgets become more constrained. Like other expense centres in a corporation, the litigation budget is under continual scrutiny. However, as most general counsel know the risk of litigation and the corresponding cost of electronic disclosure does not diminish in a downward economy. In fact, many corporations are facing even more risks today – especially those in highly regulated and litigious industries such as finance, banking, pharmaceuticals, transportation and manufacturing. No company, large or small, is exempt from litigation or from the increasingly complex conundrum known as electronically stored information (ESI) disclosure.

Awareness and Policy
Research commissioned by Kroll Ontrack found there has been a vast growth in ESI awareness and policy enactment over the past 12 months. This demonstrates that high profile sanctions cases and education regarding ESI have been a real wake up call to corporations and their legal teams. However, UK companies are lagging behind their US counterparts in their readiness to cope with the risks involved in legal actions, where huge volumes of computer-stored information plays a crucial role. Many companies are failing to appreciate the legal and logistical issues involved in responding to requests for often sensitive information from regulatory bodies and ensuring that they can provide details of anything that qualifies as electronic information.

The study found that whilst 70% of US companies have policies in place to deal with ESI in a litigation process (compared with 40% in 2007), only 53% (compared with 43% in 2007) of those in the UK can boast similar preparedness. Both figures represent an improved awareness of the need for policy relative to 2007, but they also suggest that the US is still outstripping the UK. In the UK, policy development is up only 10% compared to an increase of 30% in the US. The fact that companies in both the US and the UK are improving their understanding of ESI is positive, and at the same time very necessary. However, given the financial crisis, litigation is, for some, an increasingly necessary option and all companies need to be prepared in order to meet obligations in terms of data disclosure. 

Responsibility
While more companies have an ESI readiness policy, there has been a marked decline in the number of organisations that included top executives in the policy’s creation and enforcement. This, paired with the fact that respondents believe the company’s top executives should bear responsibility if their policy is called into question during litigation or an investigation, represents a worrying disparity for organisations.  Furthermore, companies are increasingly looking to IT departments to shoulder some of the ESI burden.

Though companies are increasingly looking beyond the boardroom in developing strategy for ESI, there remains a belief that CEOs and board directors should ultimately be accountable for shaping policy and its smooth functioning. This is particularly evidenced in the UK where 54% of companies say that their CEOs and board directors should be held accountable if their respective ESI policies result in governmental fines, court imposed sanctions or reputational damage. This is despite the fact that only 20% of UK companies allocate actual responsibility for policy development to such senior figures.

However, the shift in responsibility for development and enforcement can be seen to represent a more mature, collaborative approach to ESI and policy development. The undoubtedly complicated and technical nature of ESI requires a close alliance between legal and IT to ensure ESI strategies are legally compliant, all-encompassing and feasible. But, policy discussions should also include CEOs, so they are fully informed and supportive of the policy. If and when a policy is called into question is no time to play catch-up

Drivers
The huge growth in the number of companies in the US who say they have an ESI policy has been driven by the introduction of the new Federal Rules of Civil Procedure a couple of years ago, which has led to a number of high profile cases.  Fewer companies have a policy in place in the UK and the number of organisations in the US with a policy is soaring ahead.  This can be attributed to the number of cases that people have read about in the US and the fines that were involved (such as the Morgan Stanley and Qualcomm cases).

What’s interesting is that last year, there were a whole host of barriers to successfully executing ESI policies cited by respondents. This year, one third of companies claimed that a lack of time and resource was preventing them from implementing any ESI policy successfully.   

In the UK there are slightly different drivers. There have been fewer cases involving ESI, but companies will act when they see a threat from the regulators, or when they have faced a difficult case themselves and realise that they need to be better prepared. In the UK, there has been a slower progression and this can also be attributed to a lack of time and resources. Inhouse counsel believe that the judiciary is becoming increasingly well-informed about the importance of ESI in dispute resolution. In the UK there has also been a formal call by the Commercial Court for increased corporate responsibility in disclosure in an effort to control litigation costs. Judges are talking about the need for companies to have clear policies in place to justify their actions – if documents are missing and there is no plausible explanation, the Court will draw adverse inferences.

Challenges
While gaining information and education regarding ESI was a legal team’s greatest challenge in 2007, the greatest worry this year in both the UK and the US, is the growing volume of ESI. Furthermore, most companies are increasingly looking to IT departments to shoulder some of the ESI burden – ESI management is no simple task and a true partnership between legal and IT is required to make a company’s policy a success.

The issues surrounding ESI have assumed a higher priority on the business agenda as the financial crisis threatens to trigger legal actions. With litigation and the amount of electronic data requested in disclosure on the rise, coupled with tightening corporate budgets and regulation, corporations cannot afford an ESI misstep. Putting a policy in place, ensuring the executive board is part of policy creation and enforcement, and understanding your digital data landscape is critically important to risk management for the foreseeable future. Litigation is an increasingly necessary option and companies need to be prepared in order to meet data disclosure obligations.

To end the week on a light note... as it is that time of the year when we reach for the mouse and start shopping online (well those of us who don't have a branch of Woolworths to pillage) here's a little YouTube clip on the perils of using eBay – although I appreciate that is where a lot of unwanted gifts will be heading on Boxing Day...

Responsibility for the UK Statute Law Database transfers today from the Ministry of Justice to The National Archives where it will be brought together with the existing official legislation publishing responsibilities of Her Majesty’s Stationery Office (HMSO). The merger brings together within one organisation all the responsibilities for publication of UK legislation. It will integrate official legislation services from across the UK providing a single point of entry for the user, including access to primary legislation both in the form it was enacted and increasingly as it is revised; secondary legislation; Church Measures; and supporting documents. The service is designed for a wide range of audiences – members of the public, lawyers, professional users, law students, academics and officials.

The UK Statute Law Database is currently available at www.statutelaw.gov.uk and the HMSO legislation service at www.opsi.gov.uk/legislation/about_legislation – the National Archives is at www.nationalarchives.gov.uk

What a difference a year makes. Visitor figures for The Orange Rag blog have hit a new high. The total number of visitors (measured as distinct URLs) has increased by 40% from 11,000 in November 2007 to 15,500 in November 2008. And the site traffic (measured as page views) has increased by a massive 140% from 100,000 in November 2007 to 240,000 in November this year. On weekdays the average number of page views is 10,000 a day – hitting 16,000 a day when major news stories break. We'd like to thank all our regular visitors – and of course Vin Murria, IRIS and LexisNexis – for making this all possible.

The Legal Software Suppliers Association (LSSA) has announced an agreement with the Legal Services Commission (LSC) to govern how changes in LSC policy will be communicated to – and implemented by – LSSA members.
 
"I think that it's fair to say that the LSC has not always prioritised the impact of change on software vendors. Any changes in policy – including those which might seem relatively minor to the LSC – will potentially have a big impact on software providers," said LSSA chair Dominic Cullis. "However, following a recent Working Group meeting with representatives from both organisations, we are feeling much more optimistic about the LSC's ability and willingness to keep its promises with regard to how future changes will be rolled out to members of the LSSA."
 
A key element of this newfound partnership rests on the formation of this Software Vendor Working Group, a body which will help to create a formal channel for two-way communication between software vendors and the LSC. Cooperating at this level will allow the LSC to hear the views of software vendors first-hand, and to take account of these concerns when implementing change. The Working Group will also ensure that a representative range of vendors will now be brought into discussions at an earlier stage in the planning of policy implementation.
 
"We are very much aware of the impact of change on LSSA members, and recognition of this issue has reached the top level of our organisation," said  John Binks, Head of Provider Readiness at the LSC. "The Provider Readiness Team has implemented a sign-off procedure for all change requests where an impact on vendors is likely. This way, we can take the opportunity to seek the views of vendors on proposed changes, gain a better understanding of the impact they may cause, and factor that into the sign-off process. With this approach, we can ensure that the LSC understands the impact of change on software providers from the beginning, and factor into our plans proper provisions for making technical information available to vendors, along with sufficient time to prepare for change."
 
According to LSSA, even trivial changes can have a big impact on software vendors, as suppliers will need to review and understand the new specification, write and test the new code, make any necessary design changes, communicate the changes to clients, distribute the updated software, organise additional training, and then respond to any queries they receive about the changes from clients. As such, following the most recent meeting of the Working Group, both sides have agreed that any changes affecting case management software will only be requested by the LSC for implementation at two set dates in a year, in April and October. Furthermore, the LSC has promised that a clear description of the transitional arrangements – as well as requirements for access to old data – will be supplied, and that software vendors will be provided with all appropriate changes in reasonable time to allow for the development process.

BSI British Standards has published BS 10008: Evidential weight and legal admissibility of electronic information – Specification. The standard sets out the requirements for the implementation and operation of electronic information management systems, including the storage and transfer of information, and addresses issues relating to authenticity and integrity of information.   
 
Legal admissibility concerns whether or not a piece of evidence would be accepted by a court of law. To ensure admissibility, information must be managed by a secure system throughout its lifetime (which can be for many years). Where doubt can be placed on the information, the evidential weight may be reduced, potentially harming the legal case. BS 10008 ensures that any electronic information required as evidence of a business transaction is afforded the maximum evidential weight. The process is based on the specification of the requirements for planning, implementing, operating, monitoring and improving the organization’s information management systems.

Specific areas covered by the standard include:
 
• The management of electronic information over long period, including through technology changes, where information integrity is a vital business requirement
• How to manage the various risks associated with electronic information
• How to demonstrate the authenticity of electronic information
• The management of quality issues related to document scanning processes
• The provision of a full life history of an electronic object throughout its life.
 
BS 10008 combines some of the content of the BSI guides, BIP 0008-1, BIP 0008-2 and BIP 0008-3.  BIPs 0008-1,2,3 are still current and can be used in parallel to BS 10008. BS 10008 is now available from www.bsigroup.com/BS10008