“Timely detection”, “rapid and current” disclosure, “conduct a reasonable investigation to promptly determine ...”, “the most expedient time possible and without unreasonable delay”, and “immediate and appropriate corrective action.” These are just a few of the phrases used by legislation, regulation, and the U.S. Supreme Court to describe the time-sensitive requirements for effectively investigating a complaint, responding to a discovery request, governance, or preparing a compliance report.

Internal investigations usually require senior management to drop everything. Harassment and privacy cases may need immediate response. Sarbanes-Oxley responses have tight deadlines.

However, the need for fast response time conflicts with another major trend — the growing use of email as evidence. Most corporate investigations involve an analysis of email. One report in the National Law Journal states that at least 50% of the evidence presented in court cases is from email.

The reasons are clear. Email is the de facto journal of business activities. It is an uncensored, contemporaneous record of events and thoughts. Therefore, relevant messages can yield a gold mine of information for both sides in an investigation.

Unfortunately, finding relevant emails can be time consuming. Email files tend to be stored by date, not sender or topic. Therefore, even routine investigations may take days or weeks.

Companies may be penalized for delays or failure to produce timely information. Some recent high profile cases include the following:

		A jury awarded $800-million in punitive damages when Morgan Stanley repeatedly failed to produce emails in a timely manner,. The judge stated that “efforts to hide its emails” were evidence of “guilt.” (Coleman Holdings v. Morgan Stanley)
		A jury awarded $29.2-million in the largest single sex discrimination verdict in U.S. history after UBS Warburg could not produce copies of relevant emails. The jury was instructed to “infer that the [missing] evidence would have been unfavorable” to the defendant. (Zubulake v. UBS Warburg)
		The SEC imposed a fine of $10-million on Banc of America Securities, the brokerage arm of Bank of America, after they “repeatedly failed promptly to furnish” email and gave “misinformation.”

Companies also have good reasons to respond quickly. Executives, CFOs, audit committees, corporate counsels, HR professionals, and compliance managers all have a stake and usually just a few days or weeks to act.

Fortunately, systems can help and there are mistakes you can avoid to ensure speedy investigations
and effective responses.

Retention Policy

The new Federal Rules of Civil Procedure (effective December 1, 2006) apply to any company that may find itself in federal court. For example, it applies to interstate contract disputes. The FRCPhas serious implications regarding which records are retained for internal investigations.

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