Accounting giant Ernst & Young has announced its acquisition of the electronic discovery division of Cataphora for an undisclosed amount. The deal better equips E&Y to market to the legal field, differentiate itself from its competition, and upsell additional services, the consulting company said in the release.
Industry observers were quick to assess the move:
"If the threat of Dodd-Frank's impact on international business comes to pass (for example), it could be boom times ahead for the Big Four accounting firms in responding to global regulatory investigations from whistle-blowers," said Katey Wood, an e-discovery analyst for Enterprise Strategy Group, in an interview by e-mail today. The consultancy is based in Milford, Mass.
"What you have here is a services-based organization buying what is primarily a software shop," observed George Socha, of Minnesota's Socha Consulting (and a member of Law Technology News' Editorial Advisory Board. "It probably means that if you want to use Cataphora's software, you are going to be buying Ernst & Young's services as well. Depending on your perspective that could be a good thing or a bad thing," Socha added. (Consultants Socha and Tom Gelbmann offer Apersee software that helps users evaluate EDD vendors.)
The deal closed on May 27 and represents the third significant e-discovery deal in three weeks, said E&Y. Autonomy acquired Iron Mountain's digital division on May 16 and Symantec bought Clearwell Systems on May 19.
E&Y told us they'll have much more to say Wednesday (6/1) morning, so be sure to check back on our main site at www.lawtechnologynews.com and here!
Update 6/1: Full story is available here.