Electronic Data Records Law | How to Win E-Discovery

Archive Twitter Official Business Records

Twitter Legal Compliance Policy

Many enterprises and professionals are using Twitter* for official business.  One local government example is the City of Raleigh, North Carolina.  The Raleigh municipal government appears to be using Twitter to broadcast public service messages.

For legal purposes, many professionals and enterprises are wise to archive some or all of their Twitter (or Foursquare) communications.  Records may be needed for such purposes as subpoenas, e-discovery (EDD), public records law and the like.  

How does one record Twitter for long-term storage?  In practice it is difficult for an enterprise (or an individual professional) to manage electronic records –-Twitter or otherwise -- for long periods of time. This difficulty motivates records managers to focus their attention and resources.

I argue that electronic mail should normally be the cornerstone for archiving electronic business records.  My feeling is that e-mail is the first digital place the legal system expects to find important records.  When records managers tackle electronic records, e-mail is the logical first place for to focus attention and resources.  Every business person has an e-mail account, through which he or she exchanges important messages.

Thus, as a business professional adopts social media like Twitter and Facebook for serious communications, a practical approach to archiving those communications is to capture them in the professional's email account.  Services like Twitter and Facebook come and go.  They are hot this year, but something else may replace them next year.  The professional's email account, however, is fairly permanent and stable.  The email account is the unified, timeless place to store all important communications.

I've previously suggested how to use a business email account to capture Facebook messages.  Native Facebook provides tools for exchanging many kinds of FB messages via email.

I've looked for similar tools at Twitter.com.  However, native Twitter does not appear to support email as much as FB does.  Instead, Twitter supports SMS*.  SMS is normally associated with cell phones. 

Twitter's support for SMS gives me ideas for simple record-keeping.  It is relatively easy to integrate SMS with email for the purpose of capturing messages in an e-mail account.  I offer some simple examples here. I'll bet even better ways exist. 

For some professionals, the easiest way to submit a tweet* to Twitter via SMS, while also saving a copy in a business email account, is with a cell phone.  Many cell phone services such as Sprint allow the user to send an SMS message to a mobile number (such as the mobile number that Twitter supports) and, at the same time, to an e-mail address.  Accordingly, a user could use SMS on his Sprint phone to send a tweet to Twitter, with a copy to his business e-mail account, where it can be archived like all his other email.

In the alternative, the professional can subscribe to a paid service like ipipi.com to act as a gateway between email and SMS.

If the professional uses Microsoft Outlook for e-mail, she could exchange SMS message from her email client using the Outlook Mobile Service.  The service works via an SMS account with a provider like your cell phone carrier, and thus might involve special charges.  Using the Outlook Mobile Service, the user could send an SMS tweet to Twitter, and her Outlook account would keep a record just as it normally would keep a record of an outgoing email.

Here is a screenshot of a tweet sent from a Sprint phone.




What do you think of these ideas, Gentle Reader?

Update:  Apparently there is a twitter gadget for gmail that will store your tweets in gmail so they can be archived like email.

Another update:  Apparently Twitter, and search engines that search Twitter, lose much of the tweet conversation quickly.  Although Twitter keeps tweets indefinitely, it is unable to search for features like hashtags, which organize ongoing conversations, such as #iranelection.  Similarly, LinkedIn seems not to display public conversations more than a couple of weeks.

Third update:  The Broward County Sheriff's Department has created its own Twitter-like service, called CyberVisor, to broadcast messages about crimes and emergencies as they develop.  Presumably the Sheriff's Department can control and record this service better than something on Twitter.

–Benjamin Wright

Mr. Wright teaches e-discovery, records management and cyber security law at the SANS Institute.


* What is Twitter? Twitter is a popular social media service that allows users to broadcast and read short messages.  The little messages are normally stored on Twitter’s web site (in the form of a so-called micro-blog), and are often transmitted to other places such as cell phones and widgets on other web pages.

* What is SMS?  SMS means short message service.  It is best known as the standard for exchanging text messages among cellular and mobile phones.

* What is a tweet?  A tweet is a short text message, no more than 140 characters, broadcast or micro-blogged from a user's account in Twitter.

Cull ESI

Search Costs in E-Discovery and E-Disclosure

Does the cost of filtering attorney-client communications from legal disclosures justify a policy of skimpy retention of email?

To understand that question, we need background:  If an enterprise possesses records, it must be prepared to disclose them when required to do so by law.  Disclosure entails effort to find and compile the relevant records.  If the records are paper, the searching and compiling are performed manually.  But if the records are electronic, automated methods for searching and compiling may be available.

For records of electronic mail, modern archival technology enables easy searches, even if the number of records is large.  Search engines can make finding/compiling records rather low cost.  From a policy perspective, those low costs help to justify more complete and lengthy retention of e-mail within an enterprise.

But wait. Some say those low costs are offset by the expense of screening out attorney communications when law requires that the enterprise disclose records.

Is that true?  Let’s analyze the topic.

When the owner of e-mail records such as a public agency must release records under e-discovery or freedom of information act (FOIA), the owner may normally withhold those records protected by attorney-client privilege.  Why?  The law wants to encourage open communication between counsel and client and to enable lawyers to create work product outside the scrutiny of adversaries.

Given this right to withhold, a record holder naturally wants to cull out any protected attorney communications before it discloses records.  If performed manually, this detection and sifting can involve much time and expense.  Some therefore argue the holder would have been wiser in the first place not to have retained the records.  They advocate deleting e-mail records as soon as possible.  If the holder does not possess the records, they say, the holder avoids the eventual cost of filtering out the protected records.

That argument, however, ignores how rapidly search engines are advancing.  Advanced search engines employing artificial intelligence and other techniques can (so their promoters claim) outperform lawyers when examining copious records. See, Daniel Fisher, “The Data Explosion,” Forbes, October 1, 2007.  I courageously predict search engine advances will accelerate as better search methodology and algorithms are developed.

As search technology improves, the need for expensive, manual screening for protected communications diminishes.

Sure, search engines can make mistakes. A lady from a government agency reminded me that if a privileged e-mail slips out in a FOIA disclosure, the law provides no way to claw it back.  So her agency tediously examines e-mails before divulging them.

My reply:  people make mistakes too.  Moreover, the risk of an occasional privilege slip-up is small reason for a government agency to adopt a policy of early e-mail destruction.  While I respect the agency’s need for confidentiality with its lawyers, many other considerations suggest the agency is wise to keep generous electronic mail records.

Another point:  is it really in the public’s interest for a government agency to place colossal emphasis on protecting its lawyer records?

As the costs drop for implementing pretty-good automated measures for screening out protected records, the argument for minimizing the size of email archives drops too.

–Benjamin Wright, JD

 

Documentation for Swap Contracts

Electronic Records of OTC Derivatives Contracts

New financial regulations, when coupled with advancing technology, will force the retention of massive electronic commerce records.  Hear what the authorities are saying about the regulation of financial derivatives:

First:  Famed economist Hernando de Soto says poor documentation for $1 quadrillion worth of financial derivatives is wreaking havoc on the world economy. "Toxic Assets Were Hidden Assets," Wall Street Journal, 3/25/09, pA13.  He calls for much better documentation of derivatives contracts.

Second:  Former SEC Chairman Harvey Pitt recommends much new record-keeping and reporting by entities like hedge funds that have not previously been regulated. “Former SEC chief says gather, share more data,” USA Today, 3/27/09 p3B.

Third:  To prevent more of the “toxic” assets poisoning today’s financial system, Treasury Secretary Geithner says, “We will require that all non-standardized derivatives contracts be reported to trade repositories and be subject to robust standards for documentation and confirmation of trades, netting, collateral and margin practices, and close-out practices.”

What’s the definition of a “non-standardized derivatives contract?”  It’s really just a negotiated contract that allocates risk between two or more parties.  It can cover most any kind of risk or possibility, from the risk of a lawsuit to the potential for rain in the Australian Outback.  (A derivative can even be "embedded" in an routine commercial contract, such as a sale agreement or a mining agreement.)  The scope of this field is breathtaking.  Non-standardized derivatives contracts have become a very large, thinly-monitored part of our financial world. 

So what’s a complete record of one of these derivatives contracts look like?  Would it be a stack of paper, stapled together, with signatures at the end?  It could indeed be such a stack of paper. 

But . . . let’s think deeper about how contracts are documented these days.  As the methods for written business communication – letter, telex, fax, e-mail, instant message and so on -- have grown progressively more cheap and easy, the challenges for documenting complex contracts have risen.

If the derivatives contract were entered in the 1970s, using the practices of the day, a stack of paper, stapled together, would most likely be the form it would have taken.  It might have been supplemented with a few paper letters and, once-in-a-blue-moon, a telex or two.  (Some court cases enforced telex similar to paper correspondence.)

Then in the 1980s faxes became popular, and the contract might have been a stack of stapled paper, supplemented or amended by several faxes. (We learned years ago that faxes can be legally-binding records, just like paper-written letters.)  

Next, in the 1990s e-mail started to become a common form of business communication.  Numerous judicial decisions have held e-mail to be legally-binding “signed writings” essentially equivalent to paper letters.  

See JSO Associates, Inc. v Price (informal e-mails can constitute signed writings agreeing to hire a broker to sell securities and pay a commission) and Cloud Corp. v. Hasbro (formal paper contract that says it can be amended only by a signed writing is amended by informal e-mails).

The e-mails in a contractual relationship can be very numerous.  And they often are not as clearly written as old-fashioned, formal paper contracts were.

Today non-standard derivatives contracts (a.k.a. "swaps," or "custom," "customized," "tailored," "bespoke" or "bilateral" derivatives) can be negotiated, documented, amended, supplemented and interpreted by a dizzying array of electronic communications.  Fax and e-mail are probably most common, but instant messages, phone text messages, chat rooms, message boards, social networking channels and voicemail-converted-to-text are rising in usage among busy traders.  (Dedicated online marketplaces like Agora-X and 360T provide organized electronic environments for communication and negotiation of over-the-counter derivatives instruments.  A brochure for 360T says its secure marketplace supports "Real-time online chat with any requesting counterparty individual.")

In the derivatives world, "novation" (substitution of one counterparty for another) commonly occurs by e-mail.

All this communication can be critical to full documentation for a modern financial contract.  In the Lehman Brothers bankruptcy, for example, the administrator digs through mountains of e-mail to figure out what the firm’s rights and obligations were in the over-the-counter derivatives market.