Posted by Mark Swansiger on October 6, 2008 4:01 PM |Permalink|TrackBacks (0)

Dear Friends,

This issue of The Expert Advisor contains valuable advice from two Round Table Group experts with vast experience in e-discovery and 3D exhibits. Our Featured Expert, Johnette Hassell, Ph.D., a national consultant and expert witness in computer forensics and e-discovery, explains how to use the 2006 e‑discovery amendments to the Federal Rules of Civil Procedure to your advantage. 

An article authored by Jeff Drake, principal of Drake Exhibits, explains how 3D exhibits can document and demonstrate the physical aspects of cases involving a variety of catastrophic events. He details the ways in which a Demonstrative Evidence Specialist works in tandem with the legal/expert team to create a visual strategy for use in presenting a case.

A third article discusses a recent federal district court order in a patent infringement case striking out those portions of an expert witness's report that were based on secret government studies.

The Expert Advisor is dedicated to providing our readers with assistance in locating, preparing, and utilizing experts. Please send your ideas for upcoming themes or articles to mswansiger@roundtablegroup.com.

Regards,

Russ W. Rosenzweig, CEO
Round Table Group, Inc

Posted by Chris Crone on October 2, 2008 4:35 PM |Permalink|TrackBacks (0)

By Johnette Hassell

 

Johnette Hassell, Ph.D., a national consultant and expert witness in computer forensics and e-discovery, has been on Round Table Group's list of experts since 2005. She is the founder and CEO of Electronic Evidence Retrieval, L.L.C.,[1] a full-service computer forensic and e-discovery firm that provides litigation support from initial case investigation, through discovery, and into trial.  Dr. Hassell is a highly acclaimed national speaker on e-discovery and computer forensics.

 

In this article, Dr. Hassell explains how to thread the e-discovery maze created by Rules 26-37, Federal Rules of Civil Procedure.

 

You Know You Need E-Discovery Help When ...

 

• You believe the other side is not giving you all that you are entitled to
• You know the opposition has a massive information infrastructure and you want to prevent them from burying you in discovery production  
• You have proof that the other side has not produced everything
• You have just received a production of 50,000 e-mails and 500,000 documents

Have any of these circumstances occurred in your practice? Or in the practice of anyone you know? The 2006 e‑discovery amendments to the Federal Rules of Civil Procedure place powerful tactics in the hands of litigators, tactics that you can use to address each of these issues, and many others.

 

Here's how e-discovery and computer forensic consultants and experts can help you when you encounter any of these situations.

 

You Believe They Are Not Giving You All That You Are Entitled To

You have requested the production of e-mail communications between two relevant parties. After much stalling, the other side produced a few printed e-mails, saying that's all they have. You suspect that many more messages exist. In a 30.b.6 deposition, you ask the deponent how she communicates with her secretary, particularly when she is traveling. She replies, "We use e-mail." You follow up with questions about e-mail servers and document retention and destruction policies, perhaps reminding the deponent about the serious sanctions (such as $1.6 billion) imposed for deleting and not producing relevant e-mails.

 

What are your options when the other side continues to resist? You can go to the court and get an order that the e-mails be produced, which often results in only a few more messages. Or, as I recommend, you can obtain an order allowing an e-discovery expert to examine the opposing side's computers and servers, and search for existing and deleted e-mails responsive to your request. If you take the latter tactic, you'll meet resistance in the form of claims of privilege, confidential information, trade secrets, copyrights, and so on. Fortunately, there is a viable solution to this problem. The e-discovery expert can extract e-mails and other materials that satisfy your selection criteria and provide a copy to the opposing party for review. The opposition would then produce responsive, non-privileged results and provide you with a privilege/redaction log. The e-discovery expert, of course, would retain the original materials and log--just to keep everything honest.

 

You Know the Opposition Has a Massive Information Infrastructure and You Want to Prevent Them from Burying You in Discovery Production

The opposition is large, perhaps multinational. You know there is going to be a lot of discovery produced, perhaps thousands of boxes of paper documents. In one of my cases (before enactment of the e-discovery amendments), the defendant produced 8,000 e-mails; however, he generated them "electronically" by printing and then scanning them into a fax-like format. The scanned files could not be searched for recipients, subjects, key words, or other criteria. To review an e-mail, someone had to open each file, read it, and enter it into a document-tracking system.

 

This is the type of situation in which having an experienced e-discovery expert on your team really pays off. The amendments call for very early discussions of e-discovery, specifically directing attorneys to address the form of electronically stored information (ESI) production at the Rule 26 "Meet and Confer." Furthermore, counsel are directed to produce a list of persons with custody and control of ESI and a list, "by location and category," of all the ESI they expect to rely on in their case--and to produce this list at least 21 days before the Rule 26 conference. You need to be ready by knowing all that the amendments allow in e-discovery.

 

Specifying the Form of Production

As a default, the e-discovery amendments provide for the production of electronic documents in the form in which they are normally kept and used. The amendments also give you the right to request the form in which the results are to be produced; thus, your first step in protecting against the paper blizzard is to inform opposing counsel that you will request electronic production. Each discovery request should specify the form in which it should be produced. I usually suggest native form--the form in which the documents or information was originally created and stored.  Courts have been inconsistent, but at least one (Autotech Techs. Ltd. P'ship v. Automationdirect.com, Inc.) held that if you did not initially request the production in electronic form, you cannot go back and obtain it in electronic form after it was produced in a reasonably useful, albeit paper, form.

 

If you are the producer and the requester did not specify the form, the amendments require you to describe the form you will use. In contrast to Autotech, another court (White v. Graceland Coll. Ctr. for Prof'l Dev. & Lifelong Learning, Inc.) required the producer to produce e-mails a second time, in electronic form, after producing only printed e-mails in the first production.

 

The amendments specifically state that if the producing party can search the documents, the receiving side must also have that ability. They also allow native format to be converted into some "reasonably usable" form. In my case with the 8,000 e-mails, after I complained about the form of the initial delivery, the next production came in a specialized .pdf format that was not searchable. You can thwart this type of obstructionist tactic by stating in your request that any searchability in the original format must be maintained.

 

I believe that such searchability is important in discovery management. If documents can be searched, they can be electronically analyzed and organized, thereby reducing your time and your client's costs. I will discuss some specific electronic analysis later in this article.

 

Formulating Your Request for Production

Your second chance at preventing an over-inclusive production lies in carefully crafting selection criteria in your discovery request. Attorneys used to request "all documents relating to the contract between...." People went through their files and pulled what seemed to be responsive. Now, because of the sheer volume of ESI, we want to use electronic tools to identify responsive electronic documents.

 

The challenge is in answering the question, "What criteria do the tools use?" Initially, we used simple search terms such as "All files containing any of the following words: MySecretSauce, Mr. Bad Guy, Big Competitor, Smith Contract." But that approach often yields too many or too few hits. If, for example, "MySecretSauce" appears in the company's e-mail banner, every corporate e-mail would yield a hit.  Furthermore, a search for "Smith Contract" may yield too many hits if Mr. Smith is a party to many contracts, most of them unrelated to your litigation. Also, an e-mail might refer to the Smith "matter," "agreement," or "issue," and never use the word "contract."

 

While there is no magic bullet in this situation, it is a good time to call in an experienced e-discovery consultant.

 

In recognition of these issues, judges are calling for collaboration between the parties in developing selection criteria and, importantly, testing those criteria. In fact, the e-discovery amendments specifically provide for such testing.

 

Some judges, for example Magistrate Judge John Facciola in U.S. v. O'Keefe and Equity Analytics v. Lundin and Magistrate Judge Paul Grimm in Victor Stanley, Inc. v. Creative Pipe, Inc., are getting savvy about selection criteria, with Judge Grimm famously saying "all keyword searches are not created equal."

 

You Know That They Have Not Produced Everything

You have a copy of a relevant, responsive document or e-mail that the opposing side has not produced. You included search criteria in your production request that should have gotten a hit, but the item has not been produced.

 

This is another situation in which you need to call for a complete forensic examination of the opposition's computers and servers. As indicated earlier, such a request will probably be met with great resistance. But a forensic examination can recover a wealth of evidence not otherwise available, such as deleted files, file fragments that demonstrate the prior presence of files, attempts to thwart discovery by the use of secure overwriting software, and more.

 

You Have Just Received an Electronic Production of 50,000 E-Mails and 500,000 Documents

 

Your approach to reviewing this production may well depend on the size of the case. Consider two situations:

 

First, suppose you have a huge case involving hundreds of millions of dollars. There are well-known electronic e-discovery tools that process e-mails, attachments, and documents and allow you to view the data in many ways. They can identify e-mail conversations, shared documents, common-term usage and much, much more. Such tools can cost several hundred dollars per gigabyte for processing the discovery and may be cost-prohibitive for smaller cases. These tools are also valuable in the case-assessment phase to help attorneys understand the nature of their client's data.

 

Second, consider a case whose value does not justify an expenditure of the millions of dollars needed for the services described above. In such situations there are ways to significantly reduce the cost of analysis. Note that employees within a company frequently have multiple copies of the same documents and e-mails (each has his/her own copy of a document; each may have multiple versions of the same document, etc.). Thus, a first step in reducing the size of the production is to identify duplicate copies of the same information, a process known as deduping. Obviously, you only have to review a duplicate document once; however, the mere presence of a duplicate may be relevant to your case. For example, it may be of great interest that an unauthorized employee has a copy of a proprietary design document.

 

There is also an emerging technology that identifies near-duplicate documents. Near-duplicate documents are similar within a certain percentage threshold, such as two similar MS Word documents (the original and an edited version), or an e-mail and the response to that e-mail. Organizing electronic files into sets of near-duplicates reduces the time needed to review the documents and helps assure consistency in their analysis. It also provides insight into the evolution of documents and their various changes along a timeline. Typical charges for near-duplicate analysis are cents per document analyzed.

 

Because of forwarding, "cc:-ing," and replying, an e-mail collection has a more complex structure than a collection of other documents. E-mail thread analysis is used to organize e-mails into meaningful groups, such as a chain of e-mails in which each one contains its predecessor. Again, the reviewer saves time and gains consistency by reviewing a thread as an entity, rather than each e-mail individually. Attachments remain associated with their e-mail message, facilitating a "who-knew-what-when" analysis. An additional benefit is that missing e-mails can be identified, often leading, as it did in one of my cases, to the "smoking gun."  As with near-duplicate analysis, typical charges are cents per e-mail analyzed.

 

Summary

 

The e-discovery amendments address many more issues, some involving legal theory and others dealing with such practical concepts as metadata and information architectures.

Posted by Chris Crone on July 17, 2008 9:13 AM |Permalink|TrackBacks (0)

Prof. Douglas M. Branson, the W. Edward Sell Chair in Business Law at the University of Pittsburgh and a permanent Senior Fellow of the University of Melbourne School of Law (Australia), has been on Round Table Group's list of experts since 1996, consulting and testifying in corporate law, corporate governance, and securities regulation cases.

As an expert witness in many high-profile cases[1] and a consultant/lawyer with respect to hundreds of major business transactions and securities offerings, Doug is an authority on the attributes that lawyers should look for when retaining experts. His tips for avoiding impeachment attempts to provide timely guidance on prepping experts prior to depositions and trial.

 

This Top 10 presentation, á la David Letterman, is a valuable checklist for litigators to follow:

10.  Make sure that your experts minimize the number of written drafts by editing their work product electronically whenever possible. In this way, the opposition will be unable to call attention to differences in drafts, changes in wording, and so on in an attempt to waste precious deposition time trying to make your witnesses look bad.

9.    Direct your experts to honestly relate their credentials or experience. Any good lawyer will detect embellishments and portray the witness as untruthful at trial. Knowledgeable, but inexperienced, witnesses will quickly build up experience; exaggeration of their qualifications is unacceptable.

8.    Caution your witnesses to remain calm and cool, regardless of potentially abusive conduct on the part of the opposition. 

7.    Tell your experts that although a sense of humor is acceptable at a deposition, they should never be flippant or sarcastic. Direct them to be pleasant, answer the questions, and go no further; it's not their place to argue with the opposition.

6.    Understand that experts, after repeated provocation, may push back with a show of anger against the opposition. Advise your witnesses to revert to calm and cool as quickly as possible after an outburst. Although the ostensible reason for discovery is to produce information, many lawyers are bullies who pride themselves on their ability to intimidate and embarrass. Occasionally, witnesses have to show their tormenters that they are made of firm stuff.

5.    Clarify that it is not the experts' job to win the case for your side; they are merely cogs in a wheel. Make sure that your witnesses have a well-defined role in the proceedings and that they stick to that role.

4.    Advise your experts that you will steadfastly defend them in the proceedings. Reassure them that you will request recesses when it appears to be necessary or ask that the proceedings end for the day if they seem to be tiring. Make it clear that you will be actively representing them and will stick up for them whenever possible.

3.    Direct your experts to be modest, but to push the envelope on their opinions to the extent possible. Discuss tactics before the deposition.

2.    Coach your experts to be effective teachers when testifying at depositions or in court. They must explain things in clear and simple terms and provide the jury with a comfort level in a field that is otherwise alien to them. This may be their highest and best use in the litigation.

1.    Finally, work with your experts to ensure that they will clearly present their opinions. Advise them to remain strong, stay firm on what they agreed to say, and stick to it. There is nothing worse than a wishy-washy expert witness.

When screening possible experts, attorneys should look for witnesses with firm opinions and insight into how they can aid in the development of the case. If they lack familiarity with an area or sub-area, they should tell you outright, rather than "faking it until they make it."

Using an expert who has done exactly what your case entails (for example, a proxy contest at a large bank or an IPO for a biotech company) may be counterproductive because many parties with personal experience in a given area may not want to be witnesses or experts for your side. You're better off finding somebody who has a good overall experience level and is honest with you, rather than someone who is second rate but "spot on."

Meet Doug Branson

Our Featured Expert, Prof. Branson, graduated cum laude from Northwestern University School of Law and later pursued a Master of Laws at the University of Virginia, where he specialized in corporate and securities law and finished first in his class. After teaching for 22 years at Seattle University, he was recruited by the University of Pittsburgh in 1996. He authored the first U.S. treatise on corporate governance,[2] as well as 10 books on corporate law.[3]  He wrote numerous law review articles for prestigious legal periodicals in the United States, Europe, Singapore, Hong Kong, and Australia. Doug is generally considered to be among the top U.S. scholars on corporate governance and securities regulation.

Branson has served as a visiting professor at Cornell University, the University of Oregon, and Washington University. He has been the Charles Tweedy Distinguished Visiting Professor at the University of Alabama, a Fulbright Scholar at the University of Ghent, and the Paul Hastings Distinguished Professor at the University of Hong Kong. He has lectured in numerous venues around the world. Additionally, he was a U.S. State Department-sponsored consultant on corporate governance and capital markets law four times in Indonesia, twice in Ukraine, and in Slovakia.  

Posted on June 13, 2007 3:47 PM |Permalink|TrackBacks (0)

by Lisa Fields

"There are securities salespeople out there who prey on clients by not telling them the whole truth. People can be bilked quite readily," says Pete Pfeffer, an expert witness for Round Table Group and a partner at the Chicago-based Walsh, Pfeffer & Co., which provides litigation support in securities-related disputes.

Growing a securities practice

Pfeffer advises attorneys who want to grow their securities practice to "talk to CPAs and accountants, because people who have substantial assets to invest usually don't do their own taxes."

A good working relationship with CPAs can mean greater access to a steady stream of securities cases. Pfeffer encourages attorneys to speak at local CPA associations' meetings to garner exposure. His advice: Let accountants know they can call with securities-related questions, especially if a client has had significant losses.

Common scenarios for securities-related disputes

Often, CPAs and accountants raise the red flag for clients who invest substantial amounts of money by recognizing the possibility of fraud with losses tied to securities, commodities and foreign exchange trading (FOREX), Pfeffer says.

According to Pfeffer, common scenarios for such disputes include:

• Billions of dollars of variable annuities get sold every year, many inappropriately. Variable annuities can be okay investments--but not when sold to people at or near retirement age, or into already tax-deferred IRA accounts.
• Recently, much arbitration followed the bear market that ran from 2000 through 2003, Pfeffer says. Many clients who lost money in the stock market claimed their brokers were to blame, particularly if the percentage of loss was significantly greater than the market drop.
• There's nothing wrong with investing money when you think the Euro, the British pound, the Japanese yen or other currencies will gain or lose on the U.S. dollar, but some salespeople don't disclose the very high degree of risk in FOREX.
• There's a possibility for fraud when a client trades on margin: A client purchases $20,000 worth of stock but only pays $10,000; the brokerage firm loans him the other $10,000. For every dollar the market may drop, the client loses two dollars, explains Pfeffer. This can be problematic if the client doesn't understand the risks of trading on borrowed money--because no one explained those risks to him.

After they've learned about a client's losses from his or her schedule of capital gains or losses, CPAs or accountants should recommend that an attorney review the case, says Pfeffer. "The CPA won't know if the loss was due to market investments or fraud, but it would be in his--and his client's--best interest to find out."

The attorney then needs to enlist the services of an expert specializing in securities matters, to determine whether fraud seems likely, says Pfeffer. The Round Table Group can provide expert witnesses who match the specific needs of varied cases.

Determining fraud

"The questions to be asked are: 'What did the client know?' 'Could he make informed decisions?' 'Was he misled?' 'Was the risk fully and fairly disclosed?'" says Pfeffer.

If the expert finds that a case has merit and fraud seems likely, he'll recommend that the attorney file a claim.

About half of all cases settle before they're heard by a panel of arbitrators, says Pfeffer, adding: "Frequently, they settle because the attorney can demonstrate that he has amassed sufficient ammunition from a consulting expert witness, and is prepared to testify."

CPA Professional Associations

• The American Institute of Certified Public Accountants
• AGN International-North America
• American Accounting Association
• American Society of Women Accountants
• Association of Certified Fraud Examiners
• Financial Management Association International
• Independent Accountants International

Posted on March 28, 2007 9:58 AM |Permalink|TrackBacks (0)

by Lisa Fields

The global energy market is changing. Attorneys who seek witnesses for oil and natural gas litigation, or consultants to help compose jargon-heavy contracts, will need access to experts with up-to-date, specialized knowledge. The Round Table Group can help locate an ideal expert for either situation.

"They're very careful when screening people," says oil and natural gas policy expert Kent Moors, PhD, director of the Energy Policy Research Group at Duquesne University, who has been involved with several Round Table Group projects during the past three years. "Giving attorneys access to experts for ongoing client support services, not just litigation, is filling a real need in particular segments that are expanding quickly."

It is difficult for attorneys unfamiliar with the industry to find advisors who have direct access to relevant energy markets and who can provide timely, accurate intelligence and analysis, according to Moors.

"The expert has to be able to say, 'Based on what happened yesterday, here's what you need to consider in the next two months,'" he says. "Don't rely on someone who gets his information from books instead of the current marketplace." Potential experts should be authorities on the following market changes, says Moors:

• The emergence of a new international oil market: In the last year and a half, there have been significant changes to the oil market, especially how fields are operated, how companies are structured and how finance is secured and packaged.
  
  The holding structures that control all aspects of the oil extraction process, from well heads to refineries and retail markets, are also going through significant changes in a number of jurisdictions worldwide.

• The rise of liquefied natural gas: Recently, in some markets, natural gas has been cooled to a liquid state and put in tankers to be shipped anywhere. Previously, the gas was limited to destinations served by pipelines.
  
  This development has the potential to transform the energy market. Right now, liquefied gas is used most frequently in Japan and South Korea, but there are 18 terminals open or in development in the U.S. In 20 years, 15 percent of our market will likely be devoted to liquefied natural gas.

• Changes to oil financing: For decades, all oil contracts worldwide have been paid in U.S. dollars, but that will soon change. Because the European Union has emerged as a strong player in the world energy market, transactions are expected to soon be paid in euros.

If oil or natural gas companies are among your clients and these changes sound overwhelming, choose the right firm to locate someone who can help: the Round Table Group.

For more of Professor Moors' insights, read his article.

Lisa Fields can be reached at Lisa.F@BeTuitive.com.

©BeTuitive Publishing

Posted on March 16, 2007 9:22 AM |Permalink|TrackBacks (0)

by Kent Moors

The market for legal services in the oil and gas sector is expanding--and not as a result of an increasing number of traditional projects or contracts.

Several significant changes are emerging in the manner whereby parties are designing contract and holdings structures. These developments are certain to increase in the market for a variety of hydrocarbon supply, demand, pricing and sourcing reasons.

In addition, the rise of what I have often referred to as NIOM (the "New International Oil Market") will impact how we service even the traditional oil and gas proprietary, financing, operational and flow-through projects, both upstream (wellhead, field) and downstream (refinery, transport, retail).

All of this directly translates into revisions in how we approach much of the corresponding litigation and contract support demanded.

Three trends that will provide a robust sector requiring a full range of legal services

1. Within the last 18 months, the market has been moving from the well-recognized holdings controlling process and facilities to new approaches controlling product and access.

Intermediary leverage entities, often domiciled offshore, are occupying a greater position in access to crude oil and oil products, tanker leasing, refinery capacity control, hawser management, oil field servicing, and related areas, as well as a range of accompanying finance and fiduciary considerations.

2. Arbitraging control of product and market access is intensifying.

This emerges in several distinct ways. We are witnessing acceleration in swap transactions among energy types. This is enhanced in those markets where trading in carbon and other emission quotas is established.

However, the rise of liquefied natural gas (LNG) will have a decisive impact in transforming the market. LNG is the most significant change to occur in global energy in a generation.

As the volume begins to increase over the next several years, it will profoundly change the arbitrage market, the regional swing of contract and deliveries, and the kinds of litigations and recoveries sought.

In addition, arbitrage among traditional energy supplies is on the rise, with profits now often generated more from the price differential or trading spread than from the actual delivery of product.

Finally, with the phase-in of novel sources of crude (oil sands, oil shale), replacements for oil products (e.g., ethanol or biodiesel) or alternative energy sources, the arbitrage market will undergo further change.

3. All manner of oil finance, traditional and new, is about to change.

Apart from the rise of new derivative and mezzanine paper associated with a range of deals, the currency factor is shortly to undergo a fundamental revision. This may well comprise the largest single change in the oil market near-term, and it will have a decisive impact on how we structure legal support in response.

All global oil contracts have been transacted in US dollars. This has meant a considerable amount of US currency at any given time is off the table, remaining in foreign banks as petrodollars to secure consignments and finance future contracts.

This is equivalent to an interest-free loan to the American economy. So long as the dollars remain out of circulation, they cannot contribute to inflation in North America.

But all of this is about to change. Given the weakness of the US dollar and the emergence of the European Union as a major unified energy player, pressures are building to denominate contracts in euros.

Both Iran and Russia have given notice that they will introduce new benchmark crude rates, along with new oil exchanges. Those contracts will be in euros, not dollars. A few OPEC consignments sold on the Dubai Exchange have already gone forward in euros.

A de facto euro discount is already in force. Reviewing the past two years of sales, crude oil has increased 84 percent in dollar terms but only 71 percent in euro terms. The market is already factoring in the strength of the euro and the likelihood of euro-denominated oil contracts.

When these emerge in regular transactions, fewer petrodollars will remain in foreign banks. The dollars will be exchanged back to the US to fuel a significant resurgence of inflation. That inflation, in turn, will affect every energy contract in force or negotiated.

What New Opportunities Require

Providers of legal services need to understand that the oil and gas sector is changing and quickly. The new opportunities require a flexible response that relies upon expert service provisions to support what the law firm provides to a client.

Kent Moors, Ph.D., is an internationally recognized expert in global oil/natural gas policy and finance, cross-border capital flows, emerging market economic and fiscal development, political, financial and market risk assessment, as well as new techniques in energy risk management. He has been an advisor to the highest levels of the US, Russian, Kazakh, Bahamian, Iraqi and Kurdish governments, a consultant to private companies and law firms in sixteen countries and appeared over 500 times as a featured television and radio commentator in North America, Europe and Russia. A prolific writer and lecturer, his six books, more than 400 professional and market publications, and more than 150 private/public sector policy presentations and workshops have appeared in 38 countries.

Dr. Moors is President of ASIDA, Inc., an international consulting firm specializing in Russian, CIS, Caspian, and other developing market hydrocarbon and financial strategies, and Executive Managing Partner of Risk Management Associates, International, LLP, a full service global management consulting and executive training firm. He is a contributing editor to the two current leading post-Soviet oil and natural gas publications (Russian Petroleum Investor and Caspian Investor), monthly digests in Middle Eastern and Eurasian market developments.

Professor in the Graduate Center for Social and Public Policy at Duquesne University, where he also directs the Energy Policy Research Group, Dr. Moors has developed international educational programs, run training sessions for agencies of the US government, and served as an external implications consultant to ongoing policy areas having high levels of uncertainty.