Irish Bank Resolution Corporation Ltd and Others v Quinn and Others

• Jurisdiction: Ireland
• Judge: Mr. Justice Fullam
• Judgment Date: 03 March 2015
• Neutral Citation: [2015] IEHC 175
• Court: High Court
• Docket Number: [2011 No. 5843 P & 2012 No. 120 COM]
• Date: 03 March 2015

Irish Bank Resolution Corporation Limited & Ors v Quinn & Ors

BETWEEN

IRISH BANK RESOLUTION CORPORATION LIMITED & ORS

PLAINTIFFS

AND

SEAN QUINN & ORS

DEFENDANTS

[2015] IEHC 175

[5843P/2011]

THE HIGH COURT

Discovery and disclosure of information – O.31 r. 12 of the RSC – Electronic discovery – Predictive coding

Facts: The plaintiffs sought an order for approval for use of technology assisted review method in determination of discovery of the relevant documents.

Mr. Justice Fullam granted approval to the plaintiffs for use of technology assisted review combined with predictive coding. The Court found that the plaintiffs had met its obligations under o.31 r.12. The method proposed by the plaintiffs was time and cost savvy, transparent and would be carried out by the experts.

1 1. This application concerns a novel but inevitable discovery issue in this jurisdiction involving electronic documentary evidence.

2 2. In essence the plaintiffs are seeking the court's approval for the use of a process known as Technology Assisted Review ("TAR") which combines predictive coding (a technology which produces a relevance score for documents using algorithms) with human expertise.

3 3. The plaintiffs claim that TAR will save time and be more cost effective compared to the traditional manual/linear method of discovery.

Background

Proceedings

4 4. IBRC Limited is the successor to the former Anglo Irish Bank which is in liquidation. The defendants comprise of two groups, the personal defendants and the Senat defendants.

5 5. In the proceedings the plaintiffs claim that the defendants conspired to wrongfully convert assets to the value of €455 million, the property of the former Anglo Irish Bank.

Discovery

6 6. On the 19 ^th March, 2014, the commercial court (Kelly J.) ordered inter partes discovery but deferred setting a discovery timetable until the plaintiffs conducted a scoping exercise on the retrieval of potentially relevant electronic documentation and reported back to the court.

7 7. On 18 ^th June, the plaintiffs sought the defendants' consent for the use of TAR in making their discovery as set out in the affidavit of their expert Dr. Damir Khadvezic.

8 8. On 23 ^rd June, the plaintiffs informed the court that they wished to proceed with the predictive coding approach to discovery having regard to the very large volume of documents, the resources required and the costs involved. The application was grounded on the affidavit of the plaintiff's solicitor Ms. Karyn Harty. The court adjourned the matter to allow the plaintiffs provide a clearer estimate of the time required. That estimate depended on whether the defendants consented to the carrying out of predictive coding discovery.

9 9. Initially the defendants' legal representatives and the sixth defendant, Ms. Aoife Quinn, engaged with the process. A joint meeting was held on 7 ^th July at which the plaintiffs' expert attended and provided explanations in relation to the search terms used, issues of transparency, cut off, and the possibility of documents being overlooked. The meeting was followed by letter dated 9 ^th July from Ms. Harty addressing all the issues raised at the meeting and enclosing the search terms (tailored for each specific data-set) on a confidential basis.

10 10. Ultimately, the defendants' position was one of opposition, basically on the ground that TAR did not comply with O.31 r.12 of the RSC.

11 11. On the 9 ^th September the court (Kelly J.) directed a hearing to determine the following issues:

(1) Whether technology assisted review and predictive coding complied with the rules of the Superior Courts for discharging a party's discovery obligation; and

(2) If so, to determine the most appropriate methodologies to be used.

Evidence

12 12. The plaintiff's initial scoping exercise involving a key word search yielded 1.7 million potentially relevant documents. By September, following removal of duplicates (deduplication) and documents in other languages, that number had reduced to 680,809 documents suitable for predictive coding. Mr Crowley would expect that less than 10% of the 680,809 documents would need to be reviewed if predictive coding is employed. Ms. Harty estimated that a traditional linear review, using a team of 10 experienced reviewers, would take 9 months at a cost of €2 m leaving supervision and technology costs aside, whereas, the use of predictive coding would enable the plaintiffs to make discovery within a much shorter timeframe and at substantially lower cost. Mr Crowley suggests "at a fraction of the cost".

Dr. Mee, the defendants' expert suggests that a linear review using 10 reviewers could be completed in 113 days at a cost of €220,000.

13 13. Counsel advised the court that the search terms provided by Ms. Harty were wider than they appeared, as they incorporated a "Boolean search" flexibility which captured documents containing not only the specific words of the search terms but also any words connected to them.

14 14. The defendant's solicitors inquired about having a written protocol along the lines proposed in the US case of Da Silva Moore (11 CIV.1279(ALC)(AJP) which was the first instance of a US federal court accepting the use of predictive coding in discovery. The defendants suggested that the key-word search without the defendants' input left the TAR process "vulnerable to any oversight". Ms Harty indicated that while the defendants' request for input into the keyword search was "very late", she would be prepared to have a dialogue on it and that she had no objection in principle to a written protocol but said that the Da Silva Moore protocol was inappropriate for this jurisdiction.

15 15. On 30 ^th July, Ms. Harty provided a draft "Protocol for TAR" for discussion to Messrs Arthur McLean, the personal defendant's solicitors, explaining that once the Training Set (T1) and the Control Set (C1) were completed the next training phase would not commence until either agreement had been reached between the parties or the Court approved a protocol for the use of TAR and predictive coding.

16 16. The court had the following affidavit evidence;

(1) Ms. Karyn Harty on 19 ^th June, which referred to the expert evidence of Dr. Khadvezic in his affidavit of 18 ^th June.

(2) Ms. Aoife Quinn on behalf of the personal defendants dated 1 ^st August.

(3) Ms. Vivien Mee, an IT forensic expert, on behalf of the Senat defendants dated 12 ^th August.

(4) Ms. Harty's replying affidavit of 2 ^nd September which referred to the affidavits of two experts of the same date, namely a supplemental affidavit from Dr. Khadvezic and an affidavit from Mr. Conor Crowley, a US attorney specialising in electronic discovery.

General Description TAR Methodology Using Predictive Coding

17 17. (1) Technology Assisted Review is a methodology for identifying relevant electronic documents using a combination of technology based on predictive coding, and expert human input. The TAR methodology narrows the universe of a party's electronic documents to discoverable relevant documents in two stages.

1 the universe of data is narrowed to data that is potentially responsive to a discovery request relevant; and

2 the potentially responsive data is narrowed down to what is in fact responsive by means of manual review.

18 18. In his judgment in Da Silva Moore delivered on February 24 ^th, 2012, Judge Peck explained the methodology as follows at page3:

By computer-assisted coding, I mean tools (different vendors use different names) that use sophisticated algorithms to enable the computer to determine relevance, based on interaction with (i.e., training by) a human reviewer. Unlike manual review, where the review is done by the most junior staff, computer-assisted coding involves a senior partner (or small team) who review and code a "seed set" of documents. As the senior reviewer continues to code more sample documents, the computer predicts the reviewer's coding. (Or the computer codes some documents and asks the senior reviewer for feedback.)

When the system's predictions and the reviewer's coding sufficiently coincide, the system has learned enough to make confident predictions for the remaining documents. Typically the senior lawyer (or team) needs to review only a few thousand documents to train the computer.

Some systems produce a simple yes/no as to relevance, while others give a relevance score ( say.0 to 100 basis)that counsel can use to prioritise review. For example, a score above 50 may produce 97% of the relevant documents but constitutes only 20% of the entire document set.

Counsel may decide, after sampling and quality control tests, that documents with a score of below 50 are so highly likely to be irrelevant that no further human review is necessary. Counsel can also decide the cost-benefit of manual review of the documents with scores of 15-50.

Judge Peck pointed out "that every person who uses email uses predictive coding, even if they do not realise it. The "spam filter" is an example of predictive coding,"

Predictive coding is based on a modelling framework called Predictive Analytics which encompasses a variety of techniques from statistics, data mining, and game theory that analyse current and historical facts to make predictions about future events.

19 19. The plaintiffs' expert evidence was that TAR using predictive coding is accurate and cost effective for data sets of 500,000 documents but is most cost effective for data sets in excess of 1 million.

20 20. The exercise involves a number of stages;

(1) The preliminary identification of potentially relevant documents by the application of search words to all electronic documents held by a party.

(2) Training the computer

The expert group selects a first seed-set/training-set of documents, usually...