Nelson Mullins Encompass


Technology: Defensible Disposal Should Minimize Risks and Improve Litigation Readiness

May 31, 2013

Reprinted with permission of Inside Counsel

Hanging on to data unnecessarily can be risky and expensive. Data that is kept beyond legal or business retention obligations can become subject to a legal hold. The costs associated with preserving, collecting, reviewing and producing this data can be substantial. Increased exposure to compliance risks is another problematic potential result, particularly in business sectors that maintain sensitive customer information.

A “keep everything” approach may have been an effective and prudent strategy in the past; however, the reality going forward is that most companies generate too much data for this to remain a viable approach. While it is true that the cost of storing data is decreasing, most experts agree that the exponential pace of data accumulation will greatly outpace any storage cost savings. If everything is kept, companies facing litigation may be forced to review and address all their data, including data that was stored unnecessarily. In addition to driving up litigation costs and slowing discovery responsiveness, it also may increase the chance that unfavorable evidence that could have otherwise been deleted long ago may fall into the hands of an adversary.