DR 18 Griffith Hack Lawyers'
21 January 2011

DISCOVERY COSTS QUESTIONNAIRE - RESPONSE BY GRIFFITH HACK LAWYERS
 
1.    In which jurisdiction(s) is your experience of discovery of documents in civil litigation largely based? Please also specify, for example, the particular courts and registries.
 
Australia; mostly the Federal Court, however we have also experienced discovery in  the  Federal Magistrates Court, Supreme Court of Victoria and Supreme Court of NSW. 
 
2.    In what kinds of litigation or types of proceedings is your experience of discovery largely based? Please also specify, for example, any particular court list, such as the Fast Track.
 
Intellectual Property law (Intellectual Property list).  We also have experience with discovery in the Fast Track list.
 
3.    In your experience, what proportion of the total litigation expense for your clients do discovery costs generally represent? Where possible, please provide examples or illustrations of discovery costs relative to the total cost of litigation. 
 
Discovery costs are routinely in the order of 10 - 20 per cent of the total cost of the litigation. These costs can be even higher where there are protracted disputes regarding scope and confidentiality. 
 
An example of discovery costs from some recent litigation in the Federal Court Cost was approximately $375,000 (made up of $274,000 professional fees and $101,000 disbursements mostly comprising counsel fees) where the total cost of the litigation was approximately $2.7million.  These discovery costs only include those involved in receiving and reviewing documents as the party we represented did not itself provide discovery.
 
In another case which settled before trial and where discovery was only provided to the other side and we did not review the discovered documents received, the discovery costs were approximately $180,000 where the total cost of the litigation was 1.7 million.
 
4.    How do the range and/or complexity of the issues in dispute in a proceeding (prior to any narrowing by the court) affect the cost of discovery of documents? Where possible, please provide examples or illustrations of the cost of discovery relative to the range or complexity of the issues in dispute.  
 
The costs of discovery is generally not affected by the range and/or complexity of issues in dispute.  Indeed, discovery does not necessarily even ensure critical documents are disclosed in a timely manner. More often it is a process of documents en mass, often with considerable duplication and with little correlation between volume of documents and the live / critical points of dispute between the parties. 
In a matter with a large range of issues in dispute (in respect of patent validity), the cost of discovery of documents was high, with over 1 million pages of documents discovered by the patentee (over 200,000 documents).  Discovery was ordered in categories, with 4 categories of documents.
5.    How does the value of what is at stake for the parties in the proceeding affect the cost of discovery of documents? Where possible, please provide examples or illustrations of the cost of discovery relative to the value of what is at stake for the parties. [The ALRC seeks to explore commentaries which suggest that high discovery costs are more likely to occur in cases with high stakes, and to examine concerns that the costs of discovery can be disproportionate to the stakes in the litigation.] 
Discovery is usually more vast / expensive when the stakes are high as distinct from being a fair barometer of the complexity of the issues in play.  In our experience the scope and cost of discovery rise exponentially when the stakes are high. 
In a recent case, the size of the market being protected by the patentee's monopoly was in excess of AU$100 million annually.  The cost of discovery of documents (driven by the number of documents discovered by the patentee) was high. 
6.    In your experience, where the issues in dispute in a proceeding are narrowed or clarified after discovery, what proportion of discovered documents are typically used in resolving some of the issues in dispute, and generally to what extent are the issues in dispute in a proceeding narrowed through the discovery process?Where possible, please provide examples or illustrations of the proportion of discovered documents used to resolve some of the issues in dispute in a proceeding and the impact that discovered documents had in resolving those issues, as well as an indication of the extent to which the issues in dispute were narrowed through the discovery process. 
Discovery rarely resolves issues entirely between the parties. It may crystallise some parameters of the dispute or refine the emphasis of a party's case. Usually critical documents number less than 10 regardless of the number of documents discovered. This has been our experience even when millions of documents have been discovered.
In a recent case, the issues in dispute were essentially not narrowed following discovery.  One key issue was clarified, relying on approximately 5 (out of over 200,000) documents discovered. 
7.    In your experience, where cases settle after discovery, what proportion of discovered documents are usually relied upon during settlement negotiations or other alternative dispute resolution processes, and generally to what extent are those documents influential in the settlement of disputes?  Where possible, please provide examples or illustrations of the proportion of discovered documents relied upon in an alternative dispute resolution process and the impact that discovered documents had on the settlement of the dispute, as well as an indication of the proportion of discovered documents that were not used in the settlement of the dispute. 
We generally have not experienced matters settling due essentially to discovered documents, although they have been found to assist in mediation. Where there is NO bifarcation order discovery assists in providing some guide to settlement quantum - however, damages would need to be significant to justify cost of discovery.
In the recent example, the case did not settle following discovery.
In a case which did settle, discovery had no bearing on the settlement negotiations.
8.    In your experience, where cases proceed to judgment after discovery, what proportion of discovered documents are typically brought before the court for the determination of a dispute, and generally to what extent are those documents determinative in the court’s judgment?   
Where possible, please provide examples of the proportion of discovered documents admitted into evidence in a proceeding and the impact that discovered documents had on the court's judgment, as well as an indication of the proportion of discovered documents that were not relied upon at trial in the proceeding.

Very few discovered documents are ultimately admitted into evidence. Those over and above the critical documents (usually less than 10) are often used for background / chronology submissions and rarely feature in the judgment.

In the recent example, around 50 (out of over 200,000) discovered documents were admitted into evidence (and brought before the court).  The discovered documents were referred to in the judgement by way of background, but were not determinative in the judgement.