knowledge 3 August 2016 |

Technology-Assisted Review: Who Pays?

Judge Andrew Peck, a US judge known as a judicial advocate for the use of technology-assisted review (“TAR”) in appropriate cases, has refused to make orders requiring a defendant to use TAR to make discovery. The decision establishes a pattern of the US courts stepping back from dictating the methods that parties should use for discovery, much as they would like parties to co-operate. This makes sense in a jurisdiction in which parties bear their own costs. However, in Ireland, where costs follow the event, is there a more compelling case for court intervention?

The Decision in Hyles

The courts in Ireland, the US and the UK have recognised that TAR can be an effective and appropriate method to make discovery, which is more accurate than traditional linear review and can save significant costs. Parties can now access a variety of systems aimed at reducing the time and cost of making discovery. A constant theme running through the court decisions in these jurisdictions is a desire on the part of the courts that parties co-operate in relation to discovery. In litigation, co-operation does not come easily and there are cases in which a common approach to discovery just can’t be achieved.

So it was in Hyles v New York City1, a discrimination claim in which the defendant planned to use key-word searching across a number of custodians but the plaintiff sought to have the court require the defendant to use TAR. The defendant had not yet committed any significant funds to discovery, so the methodology for discovery was still wide open. It appears that the plaintiff was concerned that key-word searching might miss relevant documents, while the defendant was not convinced that it would be possible to achieve the co-operation that would be required to develop a seed set for the TAR process: it could have used TAR, but it presumably didn’t want to run the gauntlet of the inevitable interlocutory applications if the parties couldn’t co-operate.

Judge Peck was blunt in his refusal to direct the defendant to use TAR, even though “TAR is cheaper, more efficient and superior to keyword searching” and “the best and most efficient search tool.” In a pithy summary of the US case law on TAR to date, the Court referred in particular to the decision in Dynamo Holdings Ltd P’ship v Comm’r of Internal Revenue2 in which the issues were reversed. In Dynamo there was an objection to the respondent using TAR to make disclosure and the tax court said it was not “in the business of dictating to parties the process that they should use when responding to discovery”.

So also in Hyles, where the court would have liked the defendant to use TAR but would not force it to do so. Judge Peck also pointed out that technology now available (under the so-called TAR 2.0 model) eliminates issues about the seed set.

Analysis

A key issue for clients when assessing how to make discovery is cost. TAR can achieve reductions of up to 40% on traditional discovery methods but a party unfamiliar with TAR may end up with the wrong system, or paying hosting fees which may reduce the economy of using TAR in the first place. In a jurisdiction in which costs follow the event, parties run significant risk of having to pay for the discovery methodology adopted by the other side.

Therefore a party seeking discovery has a vested interest in whether the party making discovery avails of the best available methodology. This all assumes that the right technology is being used on economic terms and that the documents requiring review are susceptible to TAR.

  1. No 10 Civ 3119 (SDNY Aug 1, 2016)
  2. 143 TC 9, 2014 WL 4636526 at *3 (2014)

This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.