In this excerpt from Chapter 15 of Information Nation Warrior: Information Management Compliance Boot Camp, authors Randolph A. Kahn, ESQ and Barclay T. Blair explain the Legal Hold process and provide a checklist of items to address when issuing a Legal Hold notice.
The Legal Hold Process
Organizations should employ a process designed to notify employees of the need to preserve information related to a lawsuit, investigation, or audit. This process is commonly referred to as a "Legal Hold," "Document Hold," "Litigation Hold," or "Records Hold." The process should be described in a written policy.
Warriors should develop a Legal Hold process that includes:
- A policy specifically for the Legal department regarding their responsibility to provide a Legal Hold notice to the rest of the organizations' employees and the circumstances and timing of providing such notice.
- A separately written company policy outlining employee
responsibilities and preservation procedures. What the lawyers
are required to do in the context of a lawsuit, audit,
or formal investigation will be different from what the
rest of the employees will have to do. So don't confuse the
employees by melding both policies in one.
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- A standardized method for providing the Legal Hold notice
to employees. Legal Hold notifications should be as clear as
possible and stated in plain English so that all employees
will understand what is required. Refrain from legalese to
the extent possible.
- A statement from executive leadership in operations or
training manuals that clearly expresses the company's commitment
to records and information management compliance.
In policy, training, and on a periodic basis through
other mediums, it is prudent to remind employees of their
further obligation to preserve any information that is
even potentially relevant, even if it hurts the company. If
employees are going to "listen" to anyone they are likely to
listen to executives, so make sure the executives "speak" on
this topic often.
- A training program to educate employees about their preservation
and retention responsibilities, with updates on
new legal and regulatory requirements, and their responsibilities
relative to these changes.
- Audit or spot check procedures to make sure employees are following the policies. Recent court cases make clear that just sending out one notice to employees to preserve may not be sufficient. In addition to sending reminder notices, you need to check that employees are doing what they are supposed to.
When writing and issuing the Legal Hold notice, the Warrior should address the items in this checklist:
Send the Legal Hold notice to employees likely to have
responsive materials. Unless the matter impacts the whole
company don't send the notice to everyone. The "shot
gun" approach to distribution can undermine the process
by overwhelming employees with so many notices that
when they need to take some action they fail to.
Spell out what's required of employees in plain English. For example, "Do NOT destroy, revise, alter, hide (by encrypting or otherwise), or move company records."
Be specific about which records need to be preserved— records, documents, and drafts (paper or electronic) created within a specific time period that are about a particular product, customer, or business deal. Clarify the need to preserve relevant documents normally scheduled for disposal according to standard retention guidelines.
Do not include any privileged information or a lawyer's analysis about the merits of the matter as it could undermine the Attorney-Client Privilege.
Provide the responsible lawyer's contact information in the notice so any questions can get addressed immediately.
Contact affected business unit leadership as they will likely know who may have information that needs to be preserved or know how to get it.
Communicate directly with key players responsible for discoverable information on a consistent basis—a blanket statement to all personnel may no longer be sufficient.
Retain evidence of having sent a clear message describing legal obligations and employee responsibilities to show good faith efforts on the part of the organization.
When the matter is concluded, send employees a Notice of Termination of the Legal Hold and indicate that regular record keeping rules once again apply. Remember that information may be subject to more than one Legal Hold so verify if other pending matters require the information to still be preserved. Above all else, never rush to destroy, no matter what.
Read the rest of Chapter 15 from Information Nation Warrior: Information Compliance Boot Camp.
This was first published in September 2005
This was first published in September 2005