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NATL61_054 03/08/2007 09:55 AM Page 54 Litigation An ounce of prevention Remember these rules for the effective management of litigation. ffective litigation management demands things they would never put in a report or make the communications privileged. In Emore than containing the costs of memorandum.But e-mail leaves a perma- fact, doing so can destroy the privilege. outside counsel. It requires the identifica- nent record which, except for communi- Make sure you understand the reach of tion, prevention and management of eco- cations with counsel for the purposes of solicitor-client and litigation privilege. nomic, strategic and reputation risk, in obtaining legal advice, is producible in its much the same way these risks are man- entirety – and often has the same eviden- Responding to litigation aged in business. tiary impact as formal documents. The practicalities of litigation are foreign Litigation will require companies to E-mail pitfalls are particularly acute in to most businesspeople, so provide them demonstrate their policies and practices engineering, manufacturing and product with a description of time frames and on issues ranging from records retention, development environments, where the processes upfront. Ask counsel for a sum- privacy, electronically stored information impulse to theorize about problems, caus- mary overview in memorandum form,and (ESI), whistle-blowing, compliance with es and solutions is strong. Similar issues immediately develop an inventory of the disclosure requirements in securities laws, occur in the financial industry. Have sen- key players likely to have relevant evidence. conformity with accounting standards ior personnel been schooled in e-mail use Understand the evidentiary landscape governing financial statements, best prac- in the context of high-risk issues? Do you before your client commits to a version of tices, and codes of ethical conduct. have a protocol to govern e-mail in high- events.The late discovery of an e-mail or A discussion of all aspects of litigation risk situations? document that undermines a position management is beyond the scope of this already taken can be devastating. article. However, some of the important Electronic evidence And finally,have outside counsel gener- trigger points in an effective management Preserve and control electronic evidence. ate a litigation plan for the organization strategy can be identified. In December 2006, the United States and for the use of evidence generated Federal Rules of Procedure were amend- in the investigation phase. Develop a liti- Policies and procedures ed to address electronically stored infor- gation communication protocol and How solid and reliable are your policies mation. Canadian discovery rules also ensure that individuals in business units and procedures governing records reten- provide for extensive production of elec- understand that all communications need tion, including ESI, record hold memo- tronic information. to be vetted. randa, privacy, and compliance with stan- The sources of ESI can be overwhelm- Litigation is an unpredictable, adversar- dards governing preparation of financial ing. They include networks, servers, ial process controlled by strangers who statements, continuous disclosure require- archives, software, laptops, personal com- do not have your client's interests at ments under securities laws and ethical puters, handheld wireless devices, disaster heart. Effective litigation management codes of conduct? Keep in mind that the recovery systems, tapes, disks, drives, car- will introduce an element of control and necessity and content of such policies will tridges,Internet data,digital devices,voice- predictability into the process and, to the vary depending on the size and nature of mail, mobile phones and paging devices. greatest extent possible, vest decision- your business. Consider designating an IT person to making control in the hands of your work with counsel to capture information client. E-mail and manage analysis and production. The impact of e-mail on litigation cannot Jonathan Lisus is a partner with McCarthy be overstated. An errant, intemperate or Solicitor-client privilege Tétrault in Toronto. He has a broad business misguided e-mail can lose an otherwise Simply including corporate counsel in disputes practice specializing in shareholder good case. People often treat e-mail as communications with people inside and disputes, oppression remedies, class actions, off-the-record conversations, e-mailing outside the company does not automatically product liability and professional liability. 54 CCCA Canadian Corporate Counsel Association MARCH 2007