“The Vue ”: Managing Rising Defense & E-Discovery Costs

“The Vue”: Managing Rising Defense & E-Discovery Costs

TheVue

Personalities HOST: • Jennifer Rothstein, Esq.,JD, Insurance Discovery Specialist, ACT Litigation Services, Inc. SPECIAL GUESTS: • Andrew Forstenzer, Esq., Executive Vice President & General Counsel, Crump Group, Inc. • Tony Glenn, MBA, Senior Vice President, U.S. Casualty and Specialty Casualty Claims, Liberty International Underwriters • Bruce Meckler, Esq., Partner, Meckler Bulger Tilson Marick& Pearson LLP • Patrick O’Doherty, RPLU, Vice President & Managing Director, Excess & Surplus Lines, ProAssurance Companies

Hot Topics • Defense costs are increasing and can erode policy limits • Factors contributing to increase: • Increase in litigation (D&O class actions; employment litigation; coverage litigation) • Expert witness costs • Discovery costs • Exponential growth of electronic documents (types of cases with largest volumes of documents) • Underwriting the risks • Questions from the audience

Litigation Trends • Bankruptcy, class actions, and regulatory actions are up – especially in the financial sector • 40% of respondents have seen an increase in wage & hour, multi-plaintiff labor and employment since 2008 • Effects of the economy: • 80% of companies surveyed have seen litigation budgets stay the same or increased since 2008 Source: Fulbright’s 6th Annual Litigation Trends Survey Report

Expert witness costs • Vary by discipline • Vary by venue • Creative solutions

Discovery v. e-Discovery • Discovery - “the pre-trial phase of a lawsuit in which each party can request relevant evidentiary information through depositions, interrogatories, requests for admissions and requests for documents.” • Electronic discovery - any process in which electronic data is sought, located, secured, and searched with the intent of using it as evidence in a civil or criminal case • Examples of electronic data • What makes electronic data different? • Types of litigation generating highest costs • Large carriers have cited 45% to 75% of defense costs for D&O claims now come from e-Discovery

e-Discovery Costs • Types of litigation generating highest costs • 93% of all corporate documents are created electronically • Predictability • Hidden costs • Techniques to mitigate or manage • Can anyone control this? Who? Source: University of California Berkeley, 1999

e-Discovery • Trends • Will e-Discovery affect lawsuits settling versus going to trial? • Risk management measures • Effective and defensive management of costs and risks

Controlling the Costs • Improved and earlier claims notification by insured to carrier • Increased involvement by claims professionals in eDiscovery cost and process oversight • Greater use of alternative dispute resolution • Ongoing review of document retention policies • Improved discovery readiness • Alternative billing practices • Outsourced review

Underwriting The Risks • Can these exposures be effectively underwritten? • Identifying risks with greater than average vulnerabilities • Changes needed in risk selection process? • Impact to rate making – when does the other shoe drop?

Questions from the audience?

Follow the “Vue”… • Jennifer Rothstein – jrothstein@actlit.com • Andrew Forstenzer – andrew.forstenzer@crumpins.com • Tony Glenn – tony.glenn@libertyiu.com • Bruce Meckler – bruce.meckler@mbtlaw.com • Patrick O’Doherty – podoherty@proassurance.com

“The Vue ”: Managing Rising Defense & E-Discovery Costs