Using Technology and e-Disclosure

Introduction

E-disclosure – or the production of electronically stored information (ESI)^[2] – is increasingly prevalent in international arbitration. More and more information is being transmitted and stored in electronic and technological form: drafts of contracts are exchanged via email; key communications are sent via text message, Slack or Microsoft Teams; and hearings and high-stakes negotiations take place exclusively on Zoom. This has led arbitration practitioners to seek, and tribunals to order, substantial amounts of e-disclosure. The availability and prevalence of e-disclosure in international arbitration has been both confirmed and perhaps encouraged by the International Bar Association’s Rules on the Taking of Evidence in International Arbitration (the IBA Rules), which, starting in 2010, have made express reference to the production of ‘documents maintained in electronic form’.^[3]

E-disclosure and the production of ESI present both opportunities and challenges for international arbitration practitioners.

In terms of opportunities, production of ESI can encourage a more thorough search for and examination of relevant evidence in a case; can be more efficiently searched and managed using available technologies; and often has a reduced ecological impact compared with the mountains of paper documents used in years past.

In terms of challenges, ESI is generally found in significantly greater quantities than paper documents, and is likely to exist in duplicate forms across multiple locations. It is more easily manipulated and modified from its original form by technology and can be very burdensome and costly to produce. As the rising costs of international arbitration continue to be a ‘hot topic’, the techniques that underpin e-disclosure will, and should, be increasingly scrutinised.

An additional challenge present in international arbitration arises from cultural differences in the evidentiary traditions of practitioners and tribunal members: those from the United States and the United Kingdom, where e-disclosure practices are more developed, may tend to engage more frequently in complex and extensive production of ESI, whereas those from the civil law, inquisitorial tradition may do so on a more limited scale. This can at times lead to disagreements and disequilibrium about the scope of production of ESI and the steps counsel must take to locate and produce responsive ESI.

As information becomes increasingly electronic, producing some amount of ESI is probably inevitable in most international arbitrations. The focus of this chapter is threefold:

• to summarise the current state of play in international arbitration on production of ESI;
• to identify potentially useful practices from jurisdictions where e-disclosure is particularly developed; and
• to identify and analyse helpful technological tools and strategies that international arbitration practitioners can use to produce ESI efficiently and effectively.

Current state of play on production of ESI

Unlike domestic courts, which are largely constrained by established evidentiary and procedural rules, international arbitral tribunals have wide discretion over the production of documents in international arbitration. For instance, under the UNCITRAL Rules,^[4] ‘[a]t any time during the arbitral proceedings the arbitral tribunal may require the parties to produce documents, exhibits or other evidence within such a period of time as the arbitral tribunal shall determine’.^[5] The ICSID Convention^[6] likewise provides that ‘[e]xcept as the parties otherwise agree, the Tribunal may, if it deems it necessary at any stage of the proceedings, . . . call upon the parties to produce documents or other evidence’.^[7] The 2021 ICC Rules^[8] provide that ‘[a]t any time during the proceedings, the arbitral tribunal may summon any party to provide additional evidence’.^[9]

As with document production generally, tribunals largely have wide discretion over the use of technology and broad-based e-disclosure during arbitral proceedings, and there has historically been limited guidance on production of ESI. This reflects a key difference between document production in arbitration, which typically occurs after the parties have submitted their first round of pleadings, rather than at the outset of the case, as with US discovery. Therefore, by the time document production occurs in arbitration, parties have already submitted their primary evidence to the tribunal, and should, in principle, be less reliant on document production for material in support of their primary case than a party in a US-style litigation. This, along with other cultural factors, has historically resulted in a smaller document universe at issue in international arbitration than in US-style litigation, and consequently less need for the efficiency gains and other benefits that technology can bring to the document production process.^[10]

More recently, the availability of technology and the proliferation of ESI has, in practice, led to significant increases in the volume of documents at issue in international arbitrations. As international arbitration counsel become more familiar with technological tools used in e-disclosure, those tools often become a normalised part of the document production process, which can contribute to ‘mission creep’ during document production. Given the different functions that document production serves in international arbitration, and other procedural differences between the practice and US-style litigation, default to this kind of broad-based e-disclosure practice may not always be appropriate. When utilising e-disclosure tools in international arbitration, therefore, it is important to keep in mind the specific function of document production in the case at hand, and the actual timescale in which the document production phase must occur.

General arbitral practice has neglected a full debate and engagement with the topic of e-disclosure.^[11] However, the increasing relevance of ESI to any form of document production has led arbitral institutions to begin issuing some limited guidance about best practices for e-disclosure, including reasonable limits on its scope and the application of technological tools.

Leading arbitral institutions that have commented on the subject of e-disclosure and the concurrent increase in the volume of documents note that ‘the advent of electronic documents should not lead to any expansion of the traditional and prevailing approach to document production’^[12] in international arbitration. These institutions, and the relevant commentary, encourages arbitration practitioners to always adopt efficient procedures that safeguard against the more costly and burdensome e-disclosure practices that have been adopted in jurisdictions such as the United States.^[13]

Increasingly, updated institutional rules, particularly those applicable to commercial arbitrations, have sought to address this as well. For example, the ICDR Procedures (as amended in 2021)^[14] include in their notable features that they ‘[a]llow tribunal[s] to manage the scope of document and electronic document requests and to manage, limit, or avoid U.S. litigation-style discovery practices’.^[15] The Commentary to the 2020 IBA Rules similarly notes: ‘Expansive American—or English—style discovery is generally inappropriate in international arbitration.’^[16]

Although e-discovery and the increased availability of more advanced review platforms can certainly lead to more efficiencies in arbitration, particularly during the discovery phase, this should still be considered through the lens of arbitration, and should not be seen as an invitation for more wide-ranging requests for electronic documents. Similar to requests for production of paper documents, requests for electronic documents should remain limited in scope and tailored to the circumstances of the case.^[17]

The relationship between the admissibility and assessment of evidence and e-disclosure can be seen particularly in the application of Article 9 of the IBA Rules to document production requests for ESI.

Article 9 sets out various objections that a party may raise in response to a document production request, including:

• lack of relevance to the case or materiality to its outcome (Article 9(2)(a));
• legal impediment or privilege (Article 9(2)(b));
• unreasonable burden (Article 9(2)(c)); and
• considerations of procedural economy, proportionality, fairness or equality (Article 9(2)(g)).

If a party has the technology and e-disclosure tools (as discussed further below) potentially available to it, the relative salience of these objections may shift.^[18]

For instance, if a document production request is directed at ESI and contains targeted search terms, time frames and custodians, there may be a greater likelihood of the request identifying material that is relevant and material to the outcome of the case.^[19] At the same time, running Boolean searches on documents in a party’s possession, custody or control requires collecting that ESI from custodians, uploading them to a discovery platform and potentially hosting them for several months or even years, all of which can be costly. Moreover, because the volume of ESI is typically greater than for hard copy documents, the document universe for such searches may be in the tens, if not hundreds, of thousands of documents. Accordingly, although e-disclosure can certainly improve the efficiency of document production, it also can increase the final burden on the producing party.^[20]

This tension between e-disclosure and burden may also arise with documents that are legally privileged. Larger volumes of ESI can make it more difficult to review and accurately identify legally privileged documents, particularly because privileged content can sometimes be found in metadata^[21] or in comment bubbles or tracked changes, which are not always visible on a document review platform.^[22] In addition, although review platforms offer various methods of applying partial or full-page redactions to ESI, the act of applying redactions is not without cost, as attorneys will often need to review all or a subset of redactions to ensure that they are being applied correctly, a process that can be both costly and time-consuming. Thus, if the availability of e-disclosure encourages requesting parties to cast a wider net for documents than they otherwise would, the burden on producing parties may also increase, prompting an objection under the IBA Rules.

The Rules on the Efficient Conduct of Proceedings in International Arbitration (the Prague Rules) also set out guidelines for the use of ESI and e-disclosure, although they take a markedly less pro-document production stance overall. Pursuant to Article 4.2 of the Prague Rules, ‘[g]enerally, the arbitral tribunal and the parties are encouraged to avoid any form of document production, including e-disclosure’. Nevertheless, in those cases where document production is necessary, Article 4.5 provides that a party may request ‘a specific document which: a. is relevant and material to the outcome of the case; b. is not in the public domain; and c. is in the possession of another party or within its power or control’. Under Article 4.7 of the Prague Rules, documents produced ‘shall be submitted or produced in photocopies and/or electronically’.

Overall, the aim of guidance offered by arbitral institutions is to avoid allowing e-disclosure to alter the key principles that make arbitration potentially attractive to businesses, namely to provide more efficient and cost-effective means to resolve disputes.

E-disclosure practices from other jurisdictions

Although e-disclosure practice is relatively new to international arbitration, it is well developed in other jurisdictions – the United States and the United Kingdom, in particular, have developed numerous strategies for limiting the scope of production and ensuring equality of arms during e-disclosure. Some of these practices address challenges that are unique to discovery that takes place at the outset of a case, which, as noted above, would be less relevant to document production that takes place after the first round of pleadings in international arbitration. Others, however, address issues common to e-disclosure in the contexts of both domestic litigation and arbitration.

The scope of e-disclosure in the United States and the United Kingdom is generally far broader than that in international arbitrations. Nevertheless, both jurisdictions consider two factors in their proportionality analysis that are not expressly contemplated by the IBA Rules: namely, that e-disclosure be proportionate to (1) the overall importance of the case as a whole (including the amount in dispute) and (2) the financial resources of the producing party. The US Federal Rules of Civil Procedure require that any production of ESI be proportionate to, inter alia, ‘the importance of the issues at stake in the action’ and ‘the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery out-weighs its likely benefit’.^[23] The UK’s Practice Direction 51U likewise permits broad-based e-disclosure only in ‘an exceptional case’^[24] and considers, inter alia, ‘the importance of the case, including any non-monetary relief sought’ and ‘the financial position of each party’ when determining whether such discovery is appropriate.^[25]

To encourage efficiency and reduce later disputes, both the United States and the United Kingdom also require that counsel meet and confer at the outset about how ESI will be produced.

Both jurisdictions encourage parties to present carefully crafted search terms to limit the review burden on the producing party. US courts have ordered parties to agree on search terms for production of ESI.^[26] The United Kingdom likewise encourages parties to consider limiting e-disclosure to only ‘documents responsive to specific keyword searches, or other automated searches’.^[27] Although, for the reasons stated above, keyword searches may be less appropriate for document production in international arbitration, in which documents must generally be both relevant to the case and material to its outcome, parties faced with substantial ESI document sets might wish to agree on certain search terms to limit their overall review burden. Indeed, this possibility is expressly anticipated by the IBA Rules.^[28]

Both jurisdictions also encourage the use of technology to lessen review burdens. The Sedona Principles,^[29] which are frequently cited by US federal courts, identify ‘the potential use of search technology and other methods of reducing the volume of ESI to be preserved or produced’ as a key topic to be discussed during pre-disclosure meetings.^[30] The United Kingdom, likewise, requires parties to discuss how to reduce the cost and burden of e-disclosure, including whether to use technology-assisted review (TAR)^[31] or coding strategies to reduce duplication.^[32] UK courts may also order parties to use software or analytical tools, de-duplication software^[33] or data sampling to reduce the burden of review.^[34] The suitability of these tools to document production in international arbitration is discussed further below.

Meet-and-confers about e-disclosure in the United States also involve discussions about the types of documents that counsel are obliged to identify, preserve and produce during a case.^[35] This could be particularly relevant to international arbitration, in which there is often variance in the domestic legal ethics requirements for counsel concerning e-disclosure, as this can produce disequilibrium concerning whether and to what extent counsel will feel obligated to produce ESI beyond emails (e.g., whether text messages or chat logs in applications such as Slack, Skype or Microsoft Teams must be preserved and produced).^[36]

Finally, the United States has devised several solutions for the increased risk of inadvertent disclosure of privileged information associated with e-disclosure addressed above.

First, US practitioners often agree at the outset that production of ESI made without an intent to waive privilege can be clawed back at the request of the producing party, thereby largely precluding the receiving party from claiming waiver because of inadvertent production of privileged information in e-disclosure.^[37] A ‘claw back’ agreement could also be used as a ‘sword’ in international arbitration against any party claiming undue burden under Article 9(2)(c) of the IBA Rules in respect of producing ESI that may contain privileged information.

Second, US practitioners also often use search terms or TAR to locate hidden privileged information within documents, and to auto-populate privilege logs for voluminous ESI populations.^[38] These tools are discussed further below.

In sum, although many aspects of e-disclosure in the United States and the United Kingdom are inapplicable to document production in international arbitration, practices such as more detailed proportionality analyses, initial meet-and-confers, robust claw-back agreements, and the use of technological solutions to reduce burden on the parties might be useful tools for arbitrations in which there are large volumes of ESI.

Technological solutions and strategies

As noted above, technological tools, such as review platforms and TAR, are often considered a way to lessen the burden of e-disclosure. As e-disclosure becomes an increasingly common feature of international arbitration, and as ESI continues to be generated in larger and larger quantities by clients,^[39] it is important for counsel to familiarise themselves with such tools, to conduct their reviews efficiently while still maintaining high standards.

E-disclosure market solutions are all generally similar in offering.^[40] A product, or database,^[41] hosts the data set provided by a party, including documents received from a client or productions received from opposing parties. After the data is ingested into the platform, the data processing phase begins and key underlying components (such as document date, author and file type) are generally extracted and mapped onto applicable fields to facilitate searching.^[42]

At this stage more powerful tools such as de-duplication^[43] and email threading,^[44] can be applied, and the database begins to take shape. If documents are collected and processed in their native form,^[45] attachments can then be extracted^[46] and relationships between documents can be established.^[47] Thereafter, practitioners generally have access to a fully searchable database and are able to search for documents through keywords or extracted metadata fields. Counsel can then also create their own coding forms that deal with particular issues or themes relevant to a case, thereby creating an organisational structure within the database.

This section discusses considerations for making the decision to initiate a platform, some of the general pros and cons associated with these platforms, and finally the reliability of analytical tools that can be leveraged.

Initiating a technology solution

At the outset of an arbitration it can be useful to set up a document review and storage platform. Even though ESI volumes are usually relatively small at this point, loading available ESI onto a review platform allows practitioners to search documents efficiently and effectively during initial fact development for the first round of submissions.^[48] It also ensures that the platform is set up and organised in advance of receiving additional volumes of ESI from the client in response to counsel requests during the first round of submissions, and well in advance of any document production phase.^[49]

As soon as documents come into counsel’s possession, the decision-making process on review platform vendors and databases can begin (if in-house solutions are not available).^[50] The choice of which platform to introduce is an important strategic consideration in any e-disclosure process and is quite case-specific. A checklist of considerations for selecting a platform – including the format and volume of data, the complexity of the review required, and the client’s ability to pay review-related costs – is included at the end of this chapter.

Successful use of a review platform depends on the client’s and practitioners’ understanding of how to use the platform and the e-disclosure process generally. It is vital for counsel and support staff to attend any training sessions offered about the review platform and for them to spend some time on their own familiarising themselves with the review functionalities available, as well as the process by which data is collected and uploaded to the platform. Counsel can then better explain how the e-disclosure process works, ensuring a more focused document collection that captures the most relevant information for the case. By familiarising themselves with this technology early on, counsel teams can reduce costs and set up more efficient collection and review workflows.^[51]

Pros and cons

As discussed above, most international arbitrations involve some form of ESI and, therefore, may benefit from use of a document review platform to store and manage this data. Arbitrations that involve large volumes of ESI, or particularly complex document productions, might benefit from additional technology solutions such as TAR or predictive coding,^[52] or communications mapping. These tools, as well as strategies such as keyword searches, can also assist counsel with understanding and culling the initial data set before it is moved onto a review database, to reduce hosting costs and to ensure that the document set on the platform is as relevant as possible.^[53]

The benefit of these tools is that they can minimise recurring obstacles that arise with paper-only review or with saving ESI onto local drives. For example, de-duplication tools available on most review platforms can quickly eliminate duplicate documents that counsel might otherwise spend substantial time reviewing and re-reviewing. Review platforms also provide opportunities for greater collaboration and communication between teams, as reviewers can generally make responsiveness determinations and provide comments about documents within the review platform itself, which other team members can later consult as needed. Tools such as TAR, email threading and other analytics that help demonstrate patterns in the document set can be further utilised to increase efficiencies and save costs.^[54]

However, there are some drawbacks with this technology. First, these tools are only as good as their users. Historically, counsel have had a distrust of technology, and it can be difficult to convince teams to embrace new technological solutions, particularly in disputes where time is often of the essence. If counsel teams do not take the time to learn and master these technological tools, they may become more of a hindrance than a help during the course of an arbitration.

In addition, the fact that these tools facilitate the collection, processing and review of electronic documents is a double-edged sword. Because ESI is easier to store and back up, it tends to be more voluminous than paper documents, and is often hosted in multiple locations within a company’s data storage system, and across multiple custodians. Although the tools discussed above can facilitate a review of a commensurately larger universe of documents, this can come at a high cost in vendor fees, which can vary depending on the size of the data set. These fees can become unpredictable when counsel are grappling with a large and diffuse ESI data set, and they must be closely managed to avoid unpleasant surprises. The costs associated with such e-disclosure techniques are likely to be scrutinised further as scrutiny of costs becomes increasingly prevalent in international arbitration.

Nevertheless, counsel should avoid short-term thinking about the costs of e-disclosure solutions. Although initial ingestion and processing costs for ESI in review platforms can seem high, and the amount of time needed to set up platforms and train TAR processes may seem daunting, they may ultimately pale in comparison to the costs attributable to attorney review time.^[55] One study has shown that in large-volume cases, review-related activities accounted for 73 per cent of the total cost of e-disclosure,^[56] whereas 19 per cent was associated with processing and only 8 per cent with collection.^[57] Taking advantage of culling tools offered by review platforms such as de-duplication and email threading, as well as more advanced TAR software, allows counsel to hone in on the relevant documents more quickly, significantly reducing the size of the data to be reviewed and, therefore, the amount of time and money that needs to spent on review.^[58]

Accuracy and predictability

Practitioners are often concerned that analytical tools such as TAR will introduce substantial error into a review process, requiring much attorney time to remedy. This fear is largely misplaced. There is strong evidence to support the position that employing analytical tools such as TAR ‘yield[s] higher recall and/or precision than an exhaustive manual review process’ and with much lower effort, debunking the notion that manual review of large sets of data is the only way to ensure accurate results.^[59] Studies have found that TAR software outperforms human review in accurately identifying responsive documents, which ultimately reduces the number of documents an attorney must then review to only a fraction of what is in the collection, leading to obvious benefits in saving costs and time as well as more accuracy in the human side of review as well.^[60] These are some of the reasons that, as noted above, UK and US practice encourages the application of TAR.^[61]

However, these tools are not 100 per cent accurate. Rigorous quality control by counsel is particularly important when using tools such as TAR, to ensure accuracy in document productions. Counsel should check both responsive and non-responsive documents coded by software throughout the course of the review phase, and should provide feedback to the vendor when there are significant and recurring errors. Interfacing with TAR in this way can reduce the burden (and inaccuracy) of counsel reviewing large volumes of ESI themselves, while ensuring that counsel have strategic input and the last word on any document production.

Database checklist

The following checklist^[62] of questions can assist in determining the need for a database and which solution to choose.

Sources and format of ESI

• Where are the documents currently located?
• Who or what are the potential sources (the custodians) of the data?
• Is the ESI collected in its original native documentation (i.e., the format used by the application that created the document)?^[63]
• Are there hard-copy^[64] documents that are physically stored, or that have been previously scanned into a new electronic document?
• Does the ESI extend to communications across social media, and mobile communications (e.g., WhatsApp, LinkedIn, Facebook)?
• Are foreign language documents anticipated?^[65]

Collection

• Does the client have an in-house litigation specialist who is familiar with preservation practices and managing forensic data collection?^[66]
• Will the provider^[67] need to assist with the collection process, either remotely or on site?
• What are the potential locations of ESI (i.e., is the data domestic or abroad?) and are there any data protection laws that need to be taken into consideration for the jurisdiction you are collecting from?
• What is the volume of ESI that is expected to be collected, reviewed and produced?^[68]

Case analysis and platform capabilities

• What types of keywords might be required to limit the scope of review?
• What kinds of analytical tools are anticipated; for example, will optical character recognition and de-duplication suffice, or will more advanced features, such as email threading and predictive coding, be required?
• Do the procedural rules of the case require that documents be produced in a certain format or any other specifications regarding production?

Project management and contract attorney needs

• Does your firm have in-house e-disclosure specialists that can assist with questions from the team regarding crafting searches, for example, and who are equipped to address any potential issues that arise with the document set?
• Is the preference to have the e-disclosure provider staff a project manager who can be available to assist with any questions from the team?^[69]
• Is counsel experienced with the e-disclosure platform, or will they require significant training?
• Are there enough resources available to conduct a document review, or will you need to engage with third-party contract attorneys?^[70]

Clients

• Do they have an existing relationship or reduced rates with a particular provider?
• Do they have an in-house platform they already use?
• What is expected to be the general level of participation by the client during the e-disclosure phase?
• Are there any particularly sensitive documents, which may require additional restrictions within the database?

Costs

• What is the value of the case?
• What is the budget for the e-disclosure phase?
• If there is hard-copy documentation?
• Have costs for unitisation and objective coding been factored in?^[71]

Notes