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Alvarez & Marsal unveils discontent with Disclosure Pilot Scheme

In litigation, data matters more than ever, but the way disclosure is now being handled is causing some concern within the legal sector. New research from Alvarez and Marsal (A&M) highlights serious questions on the part of senior legal professionals as to whether the pilot is fit for purpose.

Firstly, a recap on the Disclosure Pilot Scheme

The Disclosure Pilot Scheme (DPS) was introduced in 2018 by the Disclosure Working Group, in response to concerns that the existing framework for document disclosures in legal cases needed a significant overview.

The DPS has been active in the Business and Property Courts in England and Wales since January 2019. The pilot was designed to mitigate some of the “excessive costs, scale and complexity”1 experienced by parties under the previous set of standards for disclosure.

The pilot has introduced new processes and choices for legal practitioners, and other relevant stakeholders, in an effort to make the disclosure process more “proportionate and efficient,” in the words of the Disclosure Working Group (DWG).

The DPS was originally designed to run for two years, up to January 2021. In 2020, Professor Rachael Mulheron of Queen Mary University of London published a Third Interim Report,2 which recommended a 12-month extension to the duration of the pilot. As such, the pilot is presently set to run to the end of 2021.

Perceptions of the pilot scheme as it stands

With the scheme having been live for more than two years, A&M interviewed 250 senior lawyers at UK law firms in early 2021 to better understand the impact of the pilot scheme on the legal sector.

The views of the legal profession reflect dissatisfaction with the pilot as things stand. 70% of respondents judged that the scheme is not fit for purpose, with almost all respondents (97%) expressing dissatisfaction with aspects of the pilot.

Meanwhile, bringing more choice into the disclosure process may have created new problems. 58% of respondents said that opposing parties agreed on which model to use for disclosures less than half the time. Parties having very different ideas as to what should and should not be disclosed early on does not exactly establish an open and conciliatory tone in the litigation process. Indeed, almost three-quarters (74%) of survey respondents agreed with the statement that the DPS had exacerbated the adversarial litigation environment.

The importance of technology in disclosure

A&M’s survey also highlighted aspects of positive change being driven by the pilot. A healthy majority of respondents reported engaging with models that had not been available prior to the pilot. A new approach to disclosures also led to more involvement with technology experts: 68% of respondents used technology experts from the start of the disclosure process. Access to technology helped determine the choice of disclosure model for 85% of respondents.

Assessing the results of A&M’s research, Phil Beckett, Managing Director and Head of Disputes & Investigations for Europe and the Middle East, says: “It is heartening to see that technology and expert advice is part and parcel of completing disclosure requests quickly and efficiently. All the same, there is a danger that rather than making it easier for parties to agree on the right way to deal with relevant documentation, the scheme may instead be placing further barriers between parties in the crucial early stages of disputes.”

Dan Wyatt, a partner at RPC, also commented on A&M’s findings, stating: “The benefits of using technology in disclosure have been obvious for many years. This survey result shows that lawyers acknowledge that, and that technology is playing an influential part in how disclosure is conducted.”

Conclusions

Although the DPS has helped open up more choice for parties dealing with disclosure requests, Alvarez & Marsal’s survey of senior lawyers with experience using the scheme has highlighted inadequacies and frustrations.

It is worth questioning whether a model-based approach to disclosure is the right one given the inherently adversarial litigation environment. Certainly, a high proportion of respondents agreed that litigation is being made more confrontational, not less, by the creation of an additional decision- making stage concerning model selections.

Another factor that needs to be considered is whether the DPS has had enough time to become a fully integrated part of the disclosure culture within the legal sector. Although the scheme has already been extended once, COVID-19’s effects may have hampered adoption of the scheme’s best practices and principles.

The Civil Procedure Rule Committee itself said that the pilot was “intended to effect a culture change”, and it is fair to question whether remote working has prevented the DPS from taking full effect.

Regardless of this, a majority of respondents stated that as things stand, the DPS is not fit for purpose. The clock is ticking to resolve these issues, and something needs to change.

 

 

Law, News

70% of legal professionals deem Disclosure Pilot Scheme “not fit for purpose”

Leading global professional services firm Alvarez & Marsal (A&M) has today released new research from its Disputes & Investigations practice around the effectiveness of the Disclosure Pilot Scheme (DPS). The survey of 250 senior legal professionals* revealed that 97% of senior lawyers are frustrated with aspects of the pilot as it stands – with 70% deeming the scheme unfit for purpose.

The survey, and associated report, highlights several key insights from senior lawyers around the effectiveness of the scheme currently being trialled in the U.K. Business and Property courts. With 74% of respondents judging that the DPS has exacerbated the adversarial environment in the litigation process, it seems that the pilot has some way to go for the scheme to win the fulsome support of the legal profession.

The survey also highlighted the importance of technology in the disclosure process, with a comfortable majority of respondents (85%) stating that access to technology is a determining factor when parties decide on their disclosure model. The report demonstrates that the objectivity that technology brings to complex cases should be taken into account as the pilot continues to evolve, with 77% of respondents believing that more effective use of technology could contribute to transforming the scheme for the better.

Richard East, Senior Partner at Quinn Emanuel Urquhart & Sullivan UK LLP, comments: “As the role of technology has become more central to disclosure exercises, law firms are acknowledging that experts are needed early in the process to help accelerate work and serve clients better. It is important that experts are fully integrated into the team as trusted advisors, and are not just used to address ad hoc technical challenges, but to add value right the way through the disclosure process.”

Other survey insights:

  • 68% of respondents use technology experts from the start of disclosure process;
  • Most respondents find themselves agreeing with the opposing side on which model to use less than half the time. Whilst a significant proportion of respondents (14%) state that parties are often two models or more apart at the start of a disclosure process.**
  • 68% of respondents changed their approach to engage with disclosure models that were not previously available pre-pilot;

Phil Beckett, Managing Director and Head of Disputes and Investigations at A&M in Europe and The Middle East, explained: “The pilot scheme has unquestionably got people thinking about eDisclosure more thoroughly and earlier in the process; and created more options for lawyers and other court users when it comes to disclosure processes and it is also heartening to see that technology and expert advice is part and parcel of completing disclosure requests quickly and efficiently. All of these points are great to see, but all the same, the lawyers we surveyed highlighted some significant flaws in the pilot scheme as things stand. There is a danger that rather than making it easier for parties to agree on the right way to deal with relevant documentation, the scheme may instead be placing further barriers between parties in the crucial early stages of disputes. Whilst we are aware more changes came into force in April 2021 to hopefully combat this, we will be interested to see how they play out.”

Ben Sigler, Partner at Stephenson Harwood, comments: “Unfortunately, in my experience, the DPS has significantly driven up the costs of disclosure, thereby exacerbating the main problem which it purported to address. What is most regrettable is that, in my view, none of the changes which it introduced were even necessary, as: (1) CPR 31 already provided scope for the Court to actively manage the scope of disclosure (rather than simply to order standard disclosure); and (2) technology assisted review already provided an effective solution to delivering disclosure at proportionate cost in cases involving substantial volumes of potentially disclosable data.”

Hugo Plowman, Partner at Mishcon de Reya LLP, on the other hand takes a more balanced view: “It seems to be reasonably certain that the DPS is here to stay despite the known teething problems that practitioners have experienced to date. There is a concern about front-loading of costs and creating new room for argument about the form and content of the DRD. Recently introduced changes are likely to assist in resolving some of this, but more is needed.”

Beckett concludes: “With months to go before the DPS currently expires, and with yet more changes just recently come into play (April 2021) we truly hope that with further modifications and simplifications of the scheme’s structure and more robust guidance on best practices and enforcement, the DPS will benefit lawyers and their clients long term.”