By Robert Smallwood, edited by Paula Lederman, MLS
With limited resources, today’s legal counsel, compliance managers, and records man- ager are faced with an onslaught of increasingly pressing and complex compliance and legal demands. At the core of these demands is the ability of the organization to demonstrate that it has legally defensible records management practices that can hold up in court.
Organizations can legally destroy records—but will have a greater legal defensi- bility if:
■ The authority to destroy the records is identifi ed on a retention schedule.
■ The retention requirements have been met.
■ The records are slated for destruction in the normal course of business.
■ There are no existing legal or fi nancial holds.
■ Al records of the same type are treated consistently and systematically.
The foundation of legally defensible records management practices is a solid IG underpinning, where policies and processes, supported and enforced by IT, help the organization meet its externally mandated legal requirements and internally mandated IG requirements for handling and controlling information.
A complete, current, and documented records retention program reduces stor- age and handling costs and improves searchability for records by making records
easier and faster to fi nd. This reduced search time and more complete search capability improves knowledge worker productivity. It also reduces legal risk by improving the ability to meet compliance demands while also reducing e-discovery costs and improving the ability to more effi ciently respond to discovery requests during litigation.
Most large organizations maintain records retention schedules by business unit, department, or functional area. Some organizations, particularly smaller ones, may establish organization-wide IG programs that call for the developing, updating, and improvement of an enterprise or master retention schedule. This is a tall order and is almost never accomplished—but it is possible with a determined, sustained effort. Developing enterprise-wide records retention schedules requires consultation with stakeholder groups that have valuable input to contribute to the overall development of the IG effort and to specifi c schedules for retaining record collections and their planned disposition. Consultation by the records manage- ment department, senior records offi cer , or records team must take place with representatives from the business units that create and own the records as well as with legal, compliance, risk management, IT, and other relevant stakeholder groups.
Meeting Legal Limitation Periods
A key consideration in developing retention schedules is researching and determin- ing the minimum time required to keep records that may be demanded in legal actions. “A limitation period is the length of time after which a legal action cannot be brought before the courts. Limitation periods are important because they de- termine the length of time records must be kept to support court action [including subsequent appeal periods]. It is important to be familiar with the purpose, prin- ciples, and special circumstances that affect limitation periods and therefore records retention.”34
Legal Requirements and Compliance Research
As stated at the beginning of this chapter, legal requirements trump all others. The reten- tion period for a particular records series must meet minimum retention requirements as mandated by law. Business needs and other considerations are secondary. So, legal research is required before determining retention periods. Legally required retention periods must be researched for each jurisdiction (state, country) in which the business operates, so that it complies with all applicable laws.
A limitation period is the length of time after which a legal action cannot be brought before the courts. Such a period must be factored into retention policies.
In order to locate the regulations and citations relating to retention of records, there are two basic approaches. The fi rst approach is to use a records retention citation service, which publishes in electronic form all of the retention-related citations. These services usually are bought on a subscription basis, as citations are updated on an an- nual or more frequent basis as legislation and regulations change.
Another approach is to search the laws and regulations directly using online or print resources. Records retention requirements for corporations operating in the United States may be found in the Code of Federal Regulations (CFR), the annual edition of which:
is the codifi cation of the general and permanent rules published in the Fed- eral Register by the departments and agencies of the federal government. It is divided into 50 titles that represent broad areas subject to federal regulation.
The 50 subject matter titles contain one or more individual volumes, which are updated once each calendar year, on a staggered basis. The annual update cycle is as follows: titles 1 to 16 are revised as of January 1; titles 17 to 27 are revised as of April 1; titles 28 to 41 are revised as of July 1, and titles 42 to 50 are revised as of October 1. Each title is divided into chapters, which usually bear the name of the issuing agency. Each chapter is further subdivided into parts that cover specifi c regulatory areas. Large parts may be subdivided into subparts. All parts are organized in sections, and most citations to the CFR refer to material at the section level. 35
There is an up-to-date version that is not yet a part of the offi cial CFR but is updated daily, the Electronic Code of Federal Regulations (e-CFR) . “It is not an offi cial legal edition of the CFR. The e-CFR is an editorial compilation of CFR mate- rial and Federal Register amendments produced by the National Archives and Records Administration’s Offi ce of the Federal Register (OFR) and the Government Printing Offi ce.”36 According to the gpoaccess.gov Web site:
The Administrative Committee of the Federal Register (ACFR) has authorized the National Archives and Records Administration’s (NARA) Offi ce of the Fed- eral Register (OFR) and the Government Printing Offi ce (GPO) to develop and maintain the e-CFR as an informational resource pending ACFR action to grant the e-CFR offi cial legal status. The OFR/GPO partnership is committed to presenting accurate and reliable regulatory information in the e-CFR edito- rial compilation with the objective of establishing it as an ACFR sanctioned publication in the future. While every effort has been made to ensure that the e-CFR on GPO Access is accurate, those relying on it for legal research should verify their results against the offi cial editions of the CFR, Federal Register and List of CFR Sections Affected (LSA), all available online at www.gpoaccess.gov.
Until the ACFR grants it offi cial status, the e-CFR editorial compilation does not provide legal notice to the public or judicial notice to the courts.
The OFR updates the material in the e-CFR on a daily basis. Generally, the e-CFR is current within two business days. The current update status is displayed at the top of all e-CFR web pages.
What Is a Records Retention Schedule?
A records retention schedule delineates how long a (business) record series is to be retained, and its disposition after its life cycle is complete (e.g., destruc- tion, transfer, archiving); the schedule also contains “lists of records by name or type that authorize the disposition of records.”37 Retention schedules apply to all records regardless of their format or media (e.g., physical or electronic). Retention schedules are developed for records not individually but rather by records series, categories, functions, or systems. Ideally, they include all of the record series in an organization, although they may be broken down into smaller subset schedules, such as by busi- ness unit.
Retention schedules may be maintained separately for electronic records, or they may be included in a combined schedule that includes both e-records and paper or other physical records.
Corporate records retention schedules are increasingly being maintained online, where users and also IT, legal, risk, and records management personnel can view and reference them. Electronic data and documents can easily reference these schedules and initiate a process based on a trigger event so that the life cycle of the electronic document can be automated and managed in a consistent manner. Retention schedules are basic tools that allow an organization to prove that it has a legally defensible basis on which to dispose records.
Retention schedules in large organizations typically are broken down and by business function. A functional retention schedule groups record series based on business functions, such as fi nancial, legal, product management, or sales. Each func- tion or grouping also is used for classifi cation. Rather than detail every sequence of records, these larger functional groups are less numerous and are easier for users to understand.
Some organizations are able to reach the ultimate retention goal: to keep an enterprise-wide master retention schedule, which includes the retention and
Retention schedules are developed by records series, category, function, or system—not for individual records.
Retention schedules are basic tools that allow an organization to prove that it has a legally defensible basis on which to dispose records.
A complete, current, and documented records retention program reduces storage and handling costs and improves searchability for records by making records easier and faster to fi nd.
disposition requirements for records series that cross business unit boundaries.
The master retention schedule contains all records series in the entire enterprise.
An enterprise-wide retention schedule is preferable because it eliminates the possibility that different business units will follow confl icting records retention periods. For example, if one business unit is discarding a group of records after 5 years, it would not make sense for another business unit to keep the same records for 10 years.
Benefi ts of a Retention Schedule
According to the U.S. National Archives and Records Administration, developing and maintaining a records retention schedule provides the following benefi ts. The reten- tion schedule: 38
1. Reduces legal risk and legal liability exposure.
2. Supports a legally defensible records management program.
3. Improves IG by enforcing uniformity and standardization.
4. Improves search quality and reduces search time.
5. Provides higher-quality records information to improve decision support for knowledge workers.
6. Prevents inadvertent, malicious, or premature destruction of records.
7. Improves accountability for life cycle management of records on an enter- prise-wide basis.
8. Improves security for confi dential records assets. 39 9. Reduces and minimizes costs for maintaining records.
10. Determines which records have historic value.
11. Saves hardware, utility, and labor costs by deleting records after their life span.
12. Optimizes use of online storage and access resources.
A formal approach to records management has been around since the mid-1900s, so a great deal of guidance is available before embarking on developing or updating your records retention program. Models and guides can be used to assist in the devel- opment of records retention schedules for your organization, including the interna- tional standard for records management, ISO 15489—Part 1 and 2:2001, “Information and Documentation—Records Management”; the ISO 15489 standard was written to address all kinds of records. Additional guidance may be obtained by referencing national standards, such as those in Canada, Europe, Australia, and other countries. 40 Often, in the public sector, retention guidelines are published by an authority such as the offi ce of the national, state, or provincial archivist. Some additional insights may be gleaned from ISO 16175–1:2010, “Information and Documentation—Principles and Functional Requirements for Records in Electronic Offi ce Environments—Part 1: Overview and Statement of Principles,” which establishes fundamental principles and functional requirements for software used to create and manage digital records in offi ce environments. 41
A records retention schedule is an essential part of an overall IG program. Due to the fact that a concerted IG program standardizes and enforces uniformity and
control, the entire organization benefi ts in terms of productivity, reduced risk, and improved compliance and e-discovery processes. These overarching goals and benefi ts should be championed by senior management in words and deeds. This means making the IG effort visible and providing the proper budgetary resources in terms of money and employee time to achieve its aims.
More detail on retention schedules can be found in Chapter 9 on IG and RIM functions.
The master retention schedule contains all records series in the entire enterprise.
CHAPTER SUMMARY:
KEY POINTS
■ Legal functions are the most important area of IG impact.
■ IG serves as the underpinning for effi cient e-discovery processes.
■ ESI is any information that is created or stored in electronic format.
■ The goal of the FRCP amendments is to recognize the importance of ESI and to respond to the increasingly prohibitive costs of document review and pro- tection of privileged documents.
■ The amended FRCP reinforce the importance of IG. Only about 25 percent of business information has real value and 5 percent are business records.
■ The Big Data trend underscores the need for defensible deletion of data debris.
■ In the landmark case Zubulake v. U.B.S. Warburg, the defendants were se-g verely punished by an adverse inference for deleting key e-mails and not producing copies on backup tapes.
■ The E-Discovery Reference Model is a planning tool that depicts key e-discovery process steps.
■ Implementing IG, inventorying ESI, and leveraging technology to implement records retention and LHN policies are key steps in e-discovery planning.
■ LHN management is the absolute minimum an organization should imple- ment to meet the guidelines, rules, and precedents.
■ Predictive coding software leverages human analysis when experts review a subset of documents to “teach” the software what to look for, so it can apply this logic to the full set of documents.
■ Many technologies assist in making incremental reductions in e-discovery costs, but only fully integrated predictive coding is able to completely trans- form the economics of e-discovery.
■ TAR, also known as computer-assisted review, speeds the review process by leveraging IT tools.
■ In TAR, there are three main ways to use technology to make legal review faster, less costly, and generally smarter: rules driven, facet driven, and propa- gation based.
■ It is important to have the right people in place to support the technology and the work fl ow required to conduct TAR.
■ A defensible disposition framework is an ecosystem of technology, policies, procedures, and management controls designed to ensure that records are created, managed, and disposed of at the end of their life cycle.
■ A better approach is for organizations to move away from a reactive “keep- everything” strategy to a proactive strategy of defensible deletion.y
■ Organizations can improve disposition and IG programs with a systemized, repeatable, and defensible approach.
■ A limitation period—the length of time after which a legal action cannot be brought before the courts—must be factored into retention policies.
■ A complete, current, and documented records retention program reduces storage and handling costs and improves searchability for records by making records easier and faster to fi nd.
■ Retention schedules are developed by records series, not for individual records.
■ Retention schedules are basic tools that allow an organization to prove that it has a legally defensible basis on which to dispose of records.
■ The master retention schedule contains all records series in the entire enterprise.
■ “Records retention” defi nes the length of time that records are to be kept and considers legal, regulatory, operational, and historical requirements.
■ Disposition means not just destruction but can also mean archiving and a change in ownership and responsibility for the records.
■ For most organizations, e-mail is the most common information source to begin deleting according to established retention policies.
CHAPTER SUMMARY:
KEY POINTS
(Continued)
Notes
1. Linda Volonino and Ian Redpath, e-Discovery for Dummies (Hoboken, NJ: John Wiley & Sons, 2010),s p. 9. This material is reproduced with permission from John Wiley & Sons, Inc.
2. “New Fed. Rules to Civil Procedure,” www.uscourts.gov/FederalCourts/UnderstandingtheFederalCourts/
DistrictCourts.aspx; (accessed November 26, 2013).
3. Ibid.
4. Ibid.
5. Volonino and Redpath, e-Discovery for Dummies, p. 13.s 6. Ibid., p. 11.
7. “New Fed. Rules to Civil Procedure.” www.uscourts.gov/FederalCourts/UnderstandingtheFederalCourts/
DistrictCourts.aspx; (accessed November 26, 2013).
8. “The Digital Universe Decade—Are You Ready?” IDC iView (May 2010).
9. Deidra Paknad, “Defensible Disposal: You Can’t Keep All Your Data Forever,” July 17, 2012, www.forbes .com/sites/ciocentral/2012/07/17/defensible-disposal-you-cant-keep-all-your-data-forever/
10. Sunil Soares, Selling Information Governance to the Business (MC Press Online, Ketchum, ID, 2011), p. 229. s 11. All quotations from the FRCP are from Volonino and Redpath, e-Discovery for Dummies , www.dummiess
.com/how-to/content/ediscovery-for-dummies-cheat-sheet.html (accessed May 22, 2013).
12. Linda Volonino and Ian Redpath, e-Discovery for Dummies (Hoboken, NJ: John Wiley & Sons, 2010), p. 13. s 13. Case Briefs, LLC, “Zubulake v. UBS Warburg LLC,” www.casebriefs.com/blog/law/civil-procedure/
civil-procedure-keyed-to-friedenthal/pretrial-devices-of-obtaining-information-depositions-and-dis- covery-civil-procedure-keyed-to-friedenthal-civil-procedure-law/zubulake-v-ubs-warburg-llc/2/ (ac- cessed May 21, 2013).
14. Amy Girst, “E-discovery for Lawyers,” IMERGE Consulting Report, 2008.
15. ECM2, “15-Minute Guide to eDiscovery and Early Case Assessment,” www.emc.com/collateral/
15-min-guide/h9781-15-min-guide-ediscovery-eca-gde.pdf (accessed May 21, 2013 16. Barry Murphy, telephone interview with author, April 12, 2013.
17. Email to author August 16, 2012.
18. Recommind, “What Is Predictive Coding?” www.recommind.com/predictive-coding (accessed May 7, 2013).
19. Michael LoPresti, “What Is Predictive Coding?: Including eDiscovery Applications,” KMWorld, January 14, 2013, www.kmworld.com/Articles/Editorial/What-Is-…/What-is-Predictive-Coding-Including- eDiscovery-Applications-87108.aspx
20. “Predictive Coding,” TechTarget.com, http://searchcompliance.techtarget.com/defi nition/predictive- coding, August 31, 2012 (accessed May 7, 2013).
21. “Machine Learning,” TechTarget.com http://whatis.techtarget.com/defi nition/machine-learning, accessed May 7, 2013.
22. “Predictive Coding.”
23. LoPresti, “What Is Predictive Coding?”
24. Ibid.
25. “What Does Predictive Coding Require?” Recommind Corp., www.recommind.com/predictive-coding (accessed May 24, 2013).
26. Ibid.
27. Barry Murphy, e-mail to author, May 10, 2013.
28. Ibid.
29. Ibid.
30. “The digital universe in 2020: Big Data, Bigger Digital Shadows, and Biggest Grow in the Far East,”
www.emc.com/collateral/analyst-reports/idc-the-digital-universe-in-2020.pdf (accessed November 26, 2013).
31. Council of Information Auto-Classifi cation, “Information Explosion” survey, http://infoautoclassifi cation .org/survey.php (accessed November 26, 2013).
32. Ibid.
33. Maura R. Grossman and Gordon V. Cormack, “Technology-Assisted Review in E-Discovery Can Be More Effective and More Effi cient Than Exhaustive Manual Review.” http://delve.us/downloads/Tech- nology-Assisted-Review-In-Ediscovery.pdf (accesssed November 26, 2013).
34. Government of Alberta, “Developing Retention and Disposition Schedules,” July 2004, p. 122, www .rimp.gov.ab.ca/publications/pdf/SchedulingGuide.pdf
35. U.S. Government Printing Offi ce (GPO), “Code of Federal Regulations,” www.gpo.gov/help/index .html#about_code_of_federal_regulations.htm (accessed April 22, 2012).
36. National Archives and Records Administration, “Electronic Code of Federal Regulations,” October 2, 2012 http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&tpl=%2Findex.tpl
37. U.S. Department of Energy, Records Retention Schedule Defi nition, https://commons.lbl.gov/display/
aro/Records+Retention+Schedule+Defi nition (accessed July 30, 2012).
38. National Archives, “Frequently Asked Questions about Records Scheduling and Disposition,” updated June 6, 2005, www.archives.gov/records-mgmt/faqs/scheduling.html#whysched
39. Government of Alberta, “Developing Retention and Disposition Schedules.”
40. National Archives, “Frequently Asked Questions about Records Scheduling and Disposition.”
41. International Organization for Standardization, ISO 16175-1:2010, “Information and Documentation—
Principles and Functional Requirements for Records in Electronic Offi ce Environments—Part 1:
Overview and Statement of Principles,” www.iso.org/iso/catalogue_detail.htm?csnumber=55790 (accessed July 30, 2012).