You have a case involving a number of documents that will likely be too time-consuming for your in-house team to manually collect. You find yourself in a situation where you need the assistance of an eDiscovery vendor, but you may be concerned about the costs involved. Even though eDiscovery is often an essential part of litigation, many firms cite budget concerns as one of the major challenges within the industry. The good news is that there are ways to recover costs associated with eDiscovery by viewing them from a business perspective and understanding how to effectively manage them.
Is It Appropriate to Generate a Profit from eDiscovery?
While it may be common to recover eDiscovery costs, you may be wondering whether it is ethical to generate a profit from these services. The best way to view this is by understanding that eDiscovery usage is a business decision, not an ethical decision. It is appropriate to bill clients for this work so long as firms develop a reasonable cost recovery approach and communicate it to the client in advance or within a reasonable time of beginning representation.
eDiscovery services are likely benefitting your client in collecting the facts for their case, and you are incurring these costs for the sole purpose of most effectively representing them. Adding on eDiscovery services to your litigation isn’t a cash grab from your clients, it is a method for significantly improving the outcome of their case. In fact, you may even find that you are able to add on an extra fee for eDiscovery services so long as the costs meet the reasonableness standard and are transparently communicated to the client. Keep in mind, this is only applicable if the work and skills required are comparable to the costs that are being charged.
How Firms Can Effectively Recover eDiscovery Costs
There are many costs associated with running a business, and as a law firm, eDiscovery services are likely always going to be part of these expenses. Whether you decide to add an extra charge for these services, or simply want to recover the costs, the most important factor is the need to be transparent as you present them to your client.
There are a few different ways that you can present these costs, depending on the number and types of cases that your firm manages. For example, you may bill these services based on the volume of cases, volume of data, or the amount of users for your services. It is up to your team to determine the best way to define the costs associated with your services, but typically eDiscovery vendors provide pricing that assists with making these strategic decisions.
Billing Made Easy
As you begin working with an eDiscovery vendor, they will be able to provide you detailed, line by line pricing associated with the amount of data you are collecting. When you communicate these costs to clients, it is crucial to outline them as clearly as possible, as well as explaining how these services support them in their matter. If you are to apply a surcharge for the time and effort associated with these services, be sure to explain your reasoning and inform your client of the complexity of these services.
You want to ensure the trust of your clients while making effective business decisions for your firm. By being transparent with your pricing, you not only can provide effective representation, but also create a successful partnership between your firm, your clients, and your eDiscovery vendor.
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Acorn is a legal data consulting firm that specializes in AI and Advanced Analytics for litigation applications, while providing rigorous customer service to the eDiscovery industry. Acorn primarily works with large regional, midsize national and boutique litigation firms. Acorn provides a high-touch, customized litigation support services with a heavy emphasis on seamless communications. For more information, please visit www.acornls.com.