Ediscovery providers' obligation to disclose potential conflicts

This is probably a good time to remind you that I am employed by Fios as Technology Counsel, and that the opinions expressed here are my own and not those of Fios, Inc.

The news is full of Amici's undisclosed connection to Boies Schiller around the Aldelphia case, surrounding the attorneys' duty to disclose a conflict. According to Law.com,

Amici is partly owned by four of Boies' children, three of whom are also lawyers at Boies Schiller. The family of another partner at the firm, Nicholas Gravante, also owns an interest....Both Rule 1.8(a) of the Model Rules of Professional Responsibility and New York's DR 5-104 require that lawyers seeking to do non-legal business with clients must disclose their interest, apprise their client of other alternatives and obtain written consent. Lawyers in bankruptcy proceedings must also submit statements attesting to their non-interest.

The Rocky Mountain News details the complicated relationship between the Boies family and Amici:

The Amici connection was raised in court July 26 by an attorney for the Bank of Montreal, an Adelphia creditor. In an Aug. 11 affidavit, Korologos said that Boies' son David Boies III has an investment in Legal and Scientific Systems LLC, which in turn owns half of Datamine LLC, which owns a 51 percent stake in Albany, N.Y.-based Amici. David III is not a member of the Boies Schiller firm.

Boies' children Christopher, Caryl and Jonathan Boies, who also have ownership interests in Legal and Scientific Systems, are lawyers at Boies Schiller, Korologos said in the filing.

In the ediscovery world, conflicts are handled differently from provider to provider and there are no clear standards except what is demanded by a particular client. In this case, Amici was being used as what is commonly described as a "neutral third party repository". Both the requesting parties and the producing parties needed a level of trust that their work product and strategies would not be compromised.

I believe that there should be conflicts standards for ediscovery providers and that Amici had a responsibility to disclose its connection to Boies Schiller.

In my experience, some potential clients will request a conflicts check for a particular matter, others will ask for all named parties no matter what the matter and others will not even ask for a conflicts check.

Fios (where I am employed) proactively requests conflicts information early in the sales process so that we nor our potential client waste time or incur risk.

The details necessary to scope a potential assignment could put the potential client at a disadvantage should we be engaged by the other side first. In addition, if we have helped scope the data universe for a client, we do not want to find ourselves on the other side in another matter without being aware, making an informed judgement about whether to pursue an opportunity. The pursuit would include making the proper personnel precautions and client communications. This policy has cost us some short term business, but we find that our clients appreciate our bringing potential conflicts to them with our broad interpretation of what constitutes a conflict.

There are arguments to be made that electronic discovery is a commodity service:

A legal ethics professor who asked to remain unnamed because he had been in contact with parties involved in the matter, said he thought the whole dispute was "dopey."

Though Boies Schiller lawyers' interests in Amici could be imputed to the firm, he said it was nonetheless noteworthy that none of the lawyers directly involved in representing Adelphia had any direct interest in Amici. The professor also said his impression was that Amici provided an essentially commodity service.

. However, even if the only service provided was to provide a platform for review, in my experience, there will be training for the review administrator which will include some strategic consulting. Should there be a document by document review? Should there be keyword searching? What search terms are used? Which documents are considered "hot docs"? Which documents will be introduced into evidence?

With Boies Schiller attorneys, related to the name partner, as owners of an ediscovery firm, I agree with Cravath that there should have been disclosure.

In a Sept. 6 letter to Southern District Bankruptcy Judge Robert Gerber, Cravath partner Max Shulman said his firm, which is representing accounting firm Deloitte & Touche in litigation adverse to Adelphia, found Amici "substandard" and said his client, which, like other Amici users, is paying a monthly $.06 per page storage charge, had been "vastly overcharged."

Shulman said the database was filled with extraneous, irrelevant materials. In a Sept. 9 follow-up letter to the judge, he described Amici as a "miserable system" and said users had been charged "for millions of pages of garbage -- and the fee for each of those garbage pages enriches the family of David Boies." He said the disclosure of the family interests "would have caused us to reject Amici in a heartbeat."

Pricing, performance and evidence content aside, in my opinion, the attorneys on the other side had the right to know the connection between the firm and Amici. Adelphia and the Trustee had the right to know as well. To say nothing of the other partners at Boies Schiller.

Last interesting note, the Boies Schiller website (under lawyer profiles) states that in May 1997 David Boies resigned his partnership at Cravath and founded the predecessor of Boies, Schiller & Flexner.


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