Closing The Loop

Why is litigation so expensive these days? eDiscovery costs bear a good amount of the blame. Over the past decades, the growth of eDiscovery has been a major contributor to ballooning litigation costs, with discovery making up to 50 percent of all costs in federal civil litigation. A large amount of those costs is due to eyes-on review by lawyers and paralegals, but eDiscovery vendors and service providers also make up a major cost center in the discovery process.

To make matters worse, not only are discovery costs often high, they’re highly unpredictable. Vendors often treat their pricing as trade secrets, leaving buyers (and courts) in the dark as to how their cost structure compares to the rest of the market.

To help you make sense of the mess, Logikcull has put together an eDiscovery cost calculator, allowing you to quickly and easily compare eDiscovery costs across platforms.


Why eDiscovery Costs Can Be So Hard to Pin Down

The cost of eDiscovery should be transparent and predictable, but that is rarely the case. Hidden costs—exorbitant fees for “rush” tasks, add-ons for customer support, $55 for a single DVD—can quickly pile up, pushing projects well over budget.

Take, for example, the $13 million in eDiscovery costs that Samsung ran up in one of its lawsuits with Apple. And that $13 million excludes attorneys’ fees—the vast majority of the costs went to data processing, production, and online hosting. Samsung’s vendor bills, 399 pages in total, included more than 1,500 individual charges, from 20 cents per line item to several thousand dollars. The company spent hundreds of thousands of dollars in per-GB license fees and thousands on reviewer training, along with several “hibernated subcollection fees” (what?) of more than $20,000.

Certainly, Samsung’s eDiscovery costs go well beyond those in most litigation and Samsung's vendor bills are several years old at this point. But they are not wholly atypical. More recent eDiscovery costs, like those revealed in a cost-recovery motion by H&R Block, show how $100-per-GB data ingestion fees, coupled with $250-per-GB data enrichment charges, rounded up with $25-per-GB hosting and $250-an-hour project management costs can quickly drive discovery costs north of six figures.

Whether with a traditional service provider or a cloud-based vendor, unpredictable costs can be hard to escape. Old-school eDiscovery vendors typically include costs for data loading fees, advanced analytics fees, minimum invoicing fees, and more. "Vendors in the cloud" aren't much different, with charges for services such as "data reduction," hosting overages, admin seats, and more.

 

How Much Will Your eDiscovery Project Cost?

Logikcull’s new eDiscovery Cost Calculator helps take some of the unpredictability out of eDiscovery pricing. All you need are three pieces of information: your data volume, the expected duration of your discovery process, and the number of users needed. The calculator then breaks down costs by data fees, matter creation fees, and user fees, giving you an estimated total cost for Logikcull’s cloud-based Discovery Automation, cloud vendors, and traditional service providers.

A 25-GB case, for example, with discovery lasting six months and requiring 10 users, would result in the following cost estimate:

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As you can see, there’s quite a range in possible costs: $6,000 at the least expensive, $38,100 at the most. In addition to running calculations online, you can download a more detailed breakdown of eDiscovery costs for additional insight.

Reducing the burden of eDiscovery is essential to ensuring the effectiveness of our justice system. Transparency in costs is a key part of this. We hope this calculator helps.

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This post was authored by Casey C. Sullivan, who leads education and awareness efforts at Logikcull. You can reach him at [email protected] or on Twitter at @caseycsull.

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