Legal Document Review

What is Legal Document Review?

Legal document review is a pre-production phase in the litigation process where attorneys and paralegals determine which documents to submit to a court. It involves detailed examination and document analysis to identify relevant information in the context of legal cases, due diligence, investigations, or regulatory compliance.

The legal document review process begins with attorneys exchanging large volumes of documents and evidence to be presented at trial. The basic steps involve collecting, examining, identifying, preserving, processing, reviewing, and analyzing all documents, including electronically stored ones.

Not all documents are produced during the case, but legal professionals need to review all of them. Privileged documents and those deemed “too sensitive” are withheld from production.

Modern contract management software automates and expedites this process. It allows companies and legal professionals to search through vast amounts of documents, categorize and label them, and search for keywords, phrases, and clauses within them in seconds.

Synonyms

• Legal discovery process
• Electronic discovery
• E-discovery
• Compliance review

Purpose of Legal Document Review in Legal Processes

The purpose of legal document review in legal processes is multifaceted. Since it is a pre-trial phase, its primary aim is to prepare attorneys for the legal battle ahead while staying compliant with the rules of evidence and civil procedure.

More specifically, it serves the following functions:

• Relevance determination — Identifying which documents are relevant to a case and helping attorneys understand the available evidence to formulate their legal strategies​​​​.
• Legal obligations fulfillment — Ensuring attorneys meet their legal obligations by reviewing and producing documents requested by the opposing party during litigation, as required by laws and regulations​​.
• Privilege and confidentiality protection — Reviewing documents to determine which are privileged or contain confidential information, protecting sensitive data​​​​.
• Evidence preparation — Preparing evidence to be used in legal proceedings, including depositions and trial.

It’s worth mentioning that legal document review is not a one-time process. As the case progresses, new evidence may come to light, which would require further analysis and review.

Key Concepts in Legal Document Review

Legal Documents

The legal team analyzes various types of legal agreements for their relevance, privilege, and compliance with laws and regulations.

Here are the key documents your legal team will review during the process:

1. Contracts — Agreements between two or more parties that outline obligations and the consequences of failing to meet those obligations. They range from simple transactions to complex business arrangements​​.
2. Wills — These documents express an individual’s wishes regarding the distribution of their assets after death, serving as a crucial element in estate planning to ensure assets are distributed as intended​​.
3. Deeds — Used to convey property ownership from one party to another, deeds contain details about the involved parties, the property, and the terms of transfer​​.
4. Patents — Governments grant these to inventors (individuals and companies). They give the creator exclusive rights to their inventions and intellectual property for a certain period​​.
5. Court filings — These include pleadings filed with the court to initiate or respond to litigation, affidavits (written statements confirmed by oath, often used as evidence), and legal briefs (detailed written arguments filed in court proceedings)​​​​.

In business, you’ll rarely see wills, as they relate to personal matters. You’ll see all types of contracts, though — sales contracts between vendors and customers, channel sales partnerships, profit sharing and stock options agreements, and dozens more.

You’ll also see patents quite frequently in industries like AI, healthcare, and biotech, where innovation is key to maintaining a competitive edge.

Review Process

The main goals of the review process should be to (a) ensure the protection of confidential information and attorney-client privilege, (b) determine which documents are relevant to the case, and (c) categorize and label documents for easy retrieval during litigation.

Here’s how the review process typically unfolds:

1. Collection — Thoroughly searching for and gathering relevant documents that contain the information or evidence needed.
2. Processing — Converting physical documents to electronic format for easier management, redacting sensitive information, indexing (coding), and storing the documents in a review platform.
3. Reviewing — Analyzing each document for relevance, privilege, confidentiality, and basic factors (e.g., date of creation).
4. Analysis — Summarizing key points and drawing conclusions from the reviewed documents to inform legal strategies.

Generally, stakeholders involved include law firms or a company’s in-house legal team, company execs and representatives, and sometimes, specialists like subject matter experts or forensic accountants.

The total phases involved and the timeline for each varies wildly depending on the case’s scale and complexity. Document volume, review objectives, the required level of detail, and technology involved all affect the timeline for process completion.

Methods and Technologies for Legal Document Review

Traditional Methods

Traditional legal document review methods require manual work from a team of lawyers, paralegals, and specialists to review documents and extract key information manually. In most cases, this requires hours or even days of work.

Generally, the method involves line-by-line review, where reviewers look for specific key terms or phrases within a document to determine relevance. Often, they do this by hand or with the aid of basic software tools like spreadsheets and databases.

Technology-Assisted Review

Today, businesses and legal teams always use legal document review software to speed up the process and eliminate the risk of human error.

eDiscovery tools automate tasks like indexing, OCRing (optical character recognition), and document retrieval. You can use them to identify relevant documents, apply tags, and even detect near-duplicates and email threads.

AI-powered document review software — namely, contract lifecycle management (CLM) platforms — also help with contract review. They streamline document management tasks, like templating, contract versioning, and storing electronic signatures.

With natural language processing (NLP), CLM also analyzes document language to identify key points relevant to the legal team’s case. Rather than requiring team members to sift through thousands of pages of documents, they can use CLM to extract relevant information quickly and accurately.

Importance of Legal Document Review in Legal Cases

Role in Litigation

Since the main goal is to identify which documents you’ll produce in court, legal document review’s role in litigation is paramount. It’s also (generally) the most expensive and time-consuming part of electronic discovery.

However, given the significance of documents as evidence in legal cases, proper review is essential. You’d be hard-pressed to find a successful legal case that didn’t involve thorough document review.

Compliance and Regulatory Requirements

Various laws dictate the handling, production, and protection of certain types of documents to ensure privacy, security, and compliance with legal standards.

For instance:

• The Health Insurance Portability and Accountability Act (HIPAA) protects patient information, which influences the types of documents that can be produced in legal cases involving medical records​​.
• The Sarbanes-Oxley Act (SOX) requires publicly traded companies to document and retain financial records for a certain period.
• In the financial industry, the Dodd-Frank Wall Street Reform and Consumer Protection Act and PCI DSS regulate transparency, accountability, and security in financial transactions.
• The Federal Information Security Management Act (FISMA) and GDPR protect digital data, particularly consumer information in databases and software.

Like everything in the legal field, these vary significantly across industries. In general, they aim to protect stakeholders, which include employees, consumers, and the public. The other overarching goal, of course, is to maintain integrity in commerce and business processes.

Risk Mitigation and Legal Strategy

Besides identifying and producing relevant documents, the review process also helps attorneys develop case strategies. The data extracted from the documents helps them understand the case’s strengths and weaknesses, determine which witnesses to depose, and identify potential challenges in court.

Legal Document Review Challenges and Solutions

Common Challenges in Legal Document Review

The average legal spend among companies has risen 30% over the last few years. And it’s largely due to the inherent complexity legal proceedings entail.

• Data volume, compounded by the variety of data sources (including emails, social media, instant messages, and cloud storage, each with its unique format and metadata)
• Cultural and language barriers in cases involving multinational corporations or global legal issues
• Managing reviews over multiple jurisdictions with differing legal standards, discovery protocols, and document production requirements
• Technological challenges like cross-platform compatibility, data integrity, and the need for continuous updates and training on eDiscovery tools
• Privacy and data protection laws at state, federal, and international levels
• Subject matter expertise (or, rather, how challenging it is to find it)
• Ensuring consistent judgment and application of review criteria across a team of reviewers
• Security risks, particularly when outsourcing reviews to third-party law firms or sharing them with new attorneys and support staff

All these factors prolong the review process, inflate legal fees, and risk compromising the case outcome.

Innovative Solutions

Maybe it goes without saying, but software is the primary solution to managing challenges in legal document review.

• Document review software has features like predictive coding and AI-assisted review to automate the data collection, organization, and analysis processes.
• CLM software keeps every business document in a searchable, secure, cloud-based contract repository so you can easily retrieve (and narrow down or abstract) anything you need.
• Integrations like e-signature and digital transaction management solutions make contracts and other legal documents more efficient.
• Smart contracts eliminate the risk of human error or malicious activities (and, by extension, discrepancies that lead to legal issues) altogether in some instances.

Beyond this, addressing the multifaceted issues associated with document review requires internal changes to your manual processes (yes, there will always be a manual element).

Start by adopting a good information governance strategy. This includes:

• Defining document retention policies and regularly purging outdated document versions
• Establishing a consistent document naming convention and metadata protocols for easy indexing
• Setting up secure, centralized storage in CLM and access permissions for users
• Training staff on data privacy, cybersecurity, and compliance (including data destruction procedures)
• Having an in-house eDiscovery team or working with an outsourced vendor that specializes in legal document review

Best Practices in Legal Document Review

Efficient Workflows

Of course, software and system integration will go a long way in helping you maximize efficiency. But change needs to happen from within. You need a team that runs like a well-oiled machine, so software is more like their superpower than a crutch they rely on.

It would also help to develop an internal repository of case studies, legal precedents, and review guidelines that reviewers can access. Treat it as a living document that serves as a valuable reference tool for complex and uncommon legal issues they encounter during reivew.

Quality Control Measures

QC filters before production, random reviews of completed work to check for consistency, and peer reviews (where different reviewers swap batches of documents and measure each other’s performance against defined review guidelines) are all essential quality control measures.

One idea is to implement quality control circles, a concept borrowed from manufacturing, where small groups of reviewers regularly discuss challenges, share best practices, and propose improvements to the review process. This way, you can continuously improvise and iterate your review processes.

Collaboration Strategies

Tackling the legal document review process as a team requires a solid collaboration strategy.

Establish a system for continuous feedback that allows reviewers to report challenges and suggest improvements. Hold regular discussions on ethical dilemmas and compliance challenges faced during reviews. And adopt project management methodologies to plan, execute, and monitor the review process.

Future Trends

Integration of Advanced Technologies

Every day, technology is increasingly integrated in the legal sector, and document review is no exception. In addition to predictive coding, contract AI, NLP, smart contracts, and document review/management platforms (which are already in use), a few other emerging technologies will play a huge role in the future of legal document review.

• Legal design. This involves using human-centered design principles to improve legal services’ and products’ usability and accessibility.
• AI-driven analytics. AI software is increasingly able to provide in-house counsel with insights about predictions about contract risks and outcomes of a lawsuit.
• No-code and low-code process automation. The ability to create workflows and cross-software automations without coding makes it easier for in-house teams to streamline the legal document review process.
• Blockchain technology. Blockchain is already revolutionizing data security and privacy practices in tons of industries by eliminating risks from centralized storage systems.
• Legal project management tools. Advanced tools for budget tracking, workflow automation, and resource allocation are making it easier to align objectives with business outcomes.

Globalization and Remote Review

It sounds counterintuitive that something as sensitive as document review would happen in any setting besides face-to-face. But with globalization, outsourced legal document review is now commonplace. The rise of virtual law firms (and remote work in general) means that there’s also an increasing demand for remote legal document review.

This presents several advantages and challenges. On one hand, it reduces overhead costs, offers access to a diverse pool of professionals, and eliminates geographical barriers. On the other, it poses challenges in terms of secure data transfer and storage, maintaining quality, and ensuring the security and privacy

Continuous Improvement in Processes

As technology advances and global competition becomes more intense, the legal profession will only become more demanding. As such, it’s essential to have continuous process improvement strategies in place.

The key is to establish a culture of ongoing learning and development. Encourage your team members to stay up-to-date with best practices to stay on top of specialized areas of legal document review.

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