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Predictive Coding: Three Things You Need to Know About This Year's Biggest Legal Tech Trend

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Predictive coding. While it sounds like it could be the latest breakthrough in the Human Genome Project, predictive coding is, in fact, one of the most discussed legal technology trends of the year. Not only does it have the potential to decide winners and losers in lawsuits, but the time and money businesses save on predictive coding may be as transformative as the iPad and iPhone have been to business communications.

Earlier this year, a judge green-lighted the use of predictive coding to recover relevant electronically stored information and, just within the last couple of weeks, predictive coding played a pivotal role in deciding which party would win a landmark case. Predictive coding, also known as technology-assisted review, involves utilizing software that enables attorneys to retrieve relevant documents and information using computer algorithms they define. It is an iterative process, where, with attorney input, each new set of algorithms produces a more carefully defined subset of relevant information. Documents are organized in a manner that supports highly targeted information analysis and the ability to discern more clearly relevant information patterns.

The growth of predictive coding will fundamentally change the discovery process in cases where massive volumes of documents are reviewed and could conceivably save businesses millions of dollars. Here's why:

• Discovery is by far the most expensive phase of the legal process. In a study released last Spring by the Rand Corporation, 73 percent of e-discovery costs were attributed to document review. Predictive coding can significantly reduce these costs, enabling businesses and their attorneys to focus on what matters most -- developing the best strategy to achieve the desired legal outcome.

• Predictive coding drastically reduces attorneys' hours spent poring over documents. It doesn't eliminate this process, it just makes it smarter. As a result, the time from the beginning to the end of a legal matter can be dramatically reduced.

• According to the Richmond Journal of Law and Technology, in an analysis of research on document review found that humans identified an average of about 60 percent of relevant documents, while predictive coding uncovered an average of 77 percent. Simply put, predictive coding helps reduce human error.

Predictive coding is light years ahead of the days in the not-too-distant past when armies of lawyers sat in backrooms going through boxes and boxes of documents. While it is not appropriate for every case, intelligent application of this process, coupled with strategic counseling, can result in significant savings of time and money for businesses involved in information and document intensive lawsuits.


Scott Vernick is an attorney at Fox Rothschild LLP. He provides counsel to Fortune 1000 companies on complex commercial litigation matters, including corporate privacy and data security. He is regularly featured in national online, print and broadcast media outlets discussing breaking cyber technology news issues.

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