Two-Thirds of Respondents Are Concerned About E-Discovery Challenges Posed by Social Media

Companies Need Legal and IT Teams to Communicate More Effectively to Tackle Challenge

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Jun 16, 2010, 10:24 ET

NEW YORK, June 16 /PRNewswire/ -- Roughly two-thirds (62 percent) of respondents surveyed who expressed an opinion say their company is concerned about e-discovery challenges posed by online social media forums, according to a survey commissioned by the Deloitte Forensic Center.

During the next three years, 49 percent of respondents expect their companies' information technology department to increase e-discovery efforts; 44 percent expect e-discovery challenges to increase; and 39 percent expect to devote more resources to e-discovery. However, of respondents with an opinion, 61 percent expect their companies to be only somewhat effective or not effective at all in dealing with e-discovery challenges three years from now.

One-quarter of respondents indicated their companies are unprepared to handle e-discovery requests pertaining to business-related use of social media, and an additional 36 percent indicated their companies are only somewhat prepared. Beyond social media platforms, only 9 percent of companies are well prepared to capture electronically stored information on third-party platforms, such as information stored in the cloud or used in software-as-a-service (SAAS) applications.

"The demands of e-discovery are clearly growing. Facebook and Twitter have not only become more prevalent in employees' personal lives, but have also become more accepted in the workplace, as companies are beginning to leverage social media platforms throughout the corporate environment," said Jeff Seymour, leader of the northeast analytic & forensic technology practice for Deloitte Financial Advisory Services LLP. "With electronically stored information rapidly rising in volume, avoiding e-discovery missteps requires cooperation from two corporate functions that typically have little in common and often don't speak the same language: legal and IT."

Communication challenges between legal and IT teams seem to be admitted by both sides. Only 23 percent of those who work in compliance, risk assessment or the legal department, and who have an opinion, say their IT department understands legal requirements for e-discovery very well. Coincidentally, only 23 percent of IT respondents with an opinion said their legal department understands very well the limits of what IT can do to support e-discovery.

"The predominant lack of effective communication between legal and IT functions can have serious repercussions including sanctions, lost cases and severe fines," said Toby Bishop, director of the Deloitte Forensic Center. "This communication challenge should be overcome if the risk of e-discovery missteps is to be mitigated. Cross-functional e-discovery training can help IT personnel understand what the legal team needs from them, and to help the legal team understand what IT can and cannot accomplish with the skills and resources they have."

The complete survey report is available at www.deloitte.com/forensiccenter

About the Survey

The Deloitte Forensic Center commissioned the Economist Intelligence Unit to conduct a survey of 337 U.S. IT, legal, risk and compliance professionals in the U.S. regarding the e-discovery challenges facing corporate America. Among the 167 IT executives participating in the survey, 43 percent were at the director level or above. Of the 170 respondents in legal, risk and compliance, 22 percent were C-suite executives. Participants were surveyed during September and October of 2009.

About the Deloitte Forensic Center

The Deloitte Forensic Center is a think tank aimed at exploring new approaches for mitigating the costs, risks and effects of fraud, corruption and other issues facing the global business community. The Center aims to advance the state of thinking in areas such as fraud and corruption by exploring issues from the perspective of forensic accountants, corporate leaders and other professionals involved in forensic matters. The Deloitte Forensic Center is sponsored by Deloitte Financial Advisory Services LLP.

About Deloitte

As used in this document, "Deloitte" means Deloitte Financial Advisory Services LLP and Deloitte Services LP, separate subsidiaries of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.

SOURCE Deloitte