Receiving notice of litigation can set off alarms within an organization. What information do we need to provide? Who needs to be providing that information? How can we organize everything before the deadline arrives?
A good legal hold notice is essential. It helps ensure that everyone keeps all important information safe for court cases or investigations. Missteps in drafting or communicating this notice can lead to data loss, legal penalties, and adverse outcomes. To prevent this, we created a complete guide on how to write and share a clear legal hold notice.
What is a Legal Hold Notice?
A legal hold notice is a document created by in-house lawyers. Companies use it when they face a lawsuit, a government investigation, or an audit.
When the organization reasonably anticipates litigation, it must implement a litigation hold. The company sends this notice to employees and outlines their responsibility to preserve all relevant information, documents, data, and records. It gives important explanations and aims to protect all relevant evidence. This helps ensure the evidence is available for the discovery process in court cases.
The organization can issue a litigation hold internally, or an attorney can send a litigation hold letter. Not following litigation hold orders can lead to severe penalties. These can include:
- Large fines
- Reimbursement of the opponent’s legal costs
- Negative assumptions against the party failing to meet discovery obligations
Key Elements of an Effective Notice
A comprehensive legal hold notice is crucial because it helps preserve all relevant information. This safeguards the organization against potential legal pitfalls while also demonstrating its commitment to legal compliance and diligence.
By clearly defining the scope, custodians, and preservation instructions, the notice reduces confusion. It also improves accountability and lowers the risk of data loss or destruction. This can help avoid serious legal issues and financial penalties.
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Clear Identification of the Case:
Begin by clearly identifying the case or investigation that necessitates the hold. Include the case name, number, and a brief description of the matter.
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Scope of the Hold:
Outline the type of information that you need to preserve. This can include documents, emails, electronic records, physical files, and any other relevant data. Being explicit is important to avoid any uncertainty.
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Custodian Identification:
Identify who is responsible for preserving the information. This typically includes employees, departments, or external or third-party partners who may have relevant data.
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Preservation Instructions:
Provide detailed instructions to all custodians on how to preserve the required information. Emphasize the prohibition of the deletion or alteration of documents and outline the steps to secure electronic data.
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Compliance Deadline:
Clearly outline the deadline by which recipients must comply with the hold notice. This helps ensure timely action and prevents inadvertent data loss.
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Contact Information:
Provide contact details for the person or department in charge of the legal hold. This allows custodians to ask questions or get clarification.
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Consequences of Non-Compliance:
Emphasize the potential consequences of failing to comply with the legal hold notice. This underscores the importance of adherence and helps custodians take the process seriously.
Best Practices for Drafting Your Notice
Now that you know what to include in your legal hold notice, it is important to follow best practices when drafting it.
Consider the following when drafting your legal hold notice:
- Clarity and Precision: Use clear and concise language to avoid any confusion. Uncertainties may result in non-compliance and possible legal consequences.
- Consistency: Ensure consistency in the information provided across all communications. Conflicting instructions can create confusion and hinder compliance.
- Tailored Instructions: Customize the notice for different departments or individuals if necessary. Different custodians may require specific instructions based on the type of data they handle.
- Legal Review: Have the notice reviewed by legal to ensure it meets all requirements and covers all relevant information.
- Technology Integration: While manual processes can suffice, integrating technology can streamline the process. Legal hold software can automate notifications, track compliance, and manage data preservation more efficiently.
Communicating the Legal Hold Notice
Communicating the legal hold notice is just as crucial as drafting it. It starts by sending the first notification through different channels, like email and printed copies, to reach everyone. To help employees understand their responsibilities, provide training sessions or informational materials.
Regular follow-ups with custodians are essential. They remind them of their duties and check if they are following the rules. Periodic reminders keep everyone aware.
Keeping detailed records of all communications about the legal hold notice is important. This helps demonstrate compliance if someone questions the hold.
Leveraging Best Practices and Technology for an Effective Legal Hold
An effective legal hold process is a bit like insurance — if you don’t invest in it now, you’re sure to need it later (and not having it could be costly).
Drafting and communicating a legal hold notice is the first step in the critical process. By including all necessary elements and following best practices, organizations can meet their legal obligations. This helps them avoid the problems of non-compliance.
While this guide provides a solid foundation, leveraging technology can further streamline the process. Legal hold software, for instance, can automate notifications, track compliance, and manage data preservation more efficiently, offering an additional layer of assurance and ease in handling legal holds.
