Act Two: Graham Smith & William Bice

In LTN's April cover story, we profile two entrepreneurs who accomplished the dream of 99% of legal technology vendors: to create a product and/or company that caught the eye of one of the industry giants, and to see it for a lot of money. In most cases, the principals cash the check and head for exotic locations.

But at LegalTech 2012, two men who hit the jackpot decided they weren't done with our community. William Bice, founder of ProLaw practices management software, and Graham Smith, founder of LiveNote litigation support software, came back for "act two" after selling to Thomson Reuters (then, Thomson West). Both launched new web-based products that compete with their original offerings -- Bice's LiquidPractice (and a second product, Exemplify, that is a document creation and comparison tool for transaction lawyers), and Smith's Opus Magnum, with integrates with other EDD software and helps uses develop their cases after they have processed their data collections.

Will they triumph twice? Check it out here.

 

Guidance Buys CaseCentral

Pasadena, Calif.-based Guidance Software has announced its acquisition of CaseCentral, bringing customers software and services from collection to review in an end-to-end e-discovery platform, report LTN's Sean Doherty and Brendan McKenna.

Before it bought CaseCentral, Guidance had used third party vendors during trial preparation to conduct further review and analysis of its customers' collected data. With San-Francisco-based CaseCentral's focus on hosted review, Guidance can now analyze, cull, and review collected data, de-NISTed using EnCase Forensics, it says.

Guidance will acquire CaseCentral for $17 million under the terms of the agreement and anticipates the acquisition will add $10 million in software-as-a-service growth in 2012.

Read the story, "Guidance Buys CaseCentral to Make End-to-End E-Discovery Platform."

Logos courtesy of Guidance and CaseCentral

Product News Brief #12118

This week's Product News Briefs includes two EDD listings:

• Nextpoint has launched customization features for its document coding and review tools.

• Symantec Buys LiveOffice for $115M and is expected to use the softwarea to put EDD applications in the cloud.

HP to Buy Autonomy? Details Tonight ....

Bloomberg is reporting that Hewlett-Packard is acquiring e-discovery giant Autonomy for $10 billion, and that the news will be announced in HP's third-quarter earnings call at 5:00 ET / 2:00 PT today. Autonomy confirmed that it is "in talks" with HP. Assuming the Bloomberg story is correct, then it's HUGE news for the legal technology industry, and it automatically makes we media types wonder what's next -- as we here at LTN have already done. This news dwarfs the Symantec deal for Clearwell at a now-meager $390 million. Stay tuned!

Editor's Update: Here is Evan's Friday report. —M.B. 

"Predictive Coding" is Not a Registered Trademark

Confusion around usage of the term "predictive coding" arose this week after Recommind commented on its patent situation. The skinny: Recommind obtained a patent on predictive coding technology and methods, but the San Francisco company does not have a registered trademark on the term itself, and so anybody can use it freely. Patents and trademarks are completely unrelated to each other.

Recommind applied for a registered trademark on the term a couple of years ago and began using the ^TM symbol. A half-dozen of the many examples are here, here, here, here, here, and here.

"We did it because we anticipated that we would soon change the ^TM to an ®, which turned out not to be the case," said Recommind's general counsel and vice president of marketing Craig Carpenter told me today, following his related remarks yesterday to Christopher Danzig at AboveTheLaw.com and Barry Murphy at eDiscoveryJournal.com. 

Reasons Emerge for E&Y's Cataphora Acquisition

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.

Image: Clipart.com

E&Y Buys Cataphora

LTN's Evan Koblentz will be filing an article shortly about Ernst & Young acquiring Cataphora.

For now, here's the  press release.

Image: Courtesy Cataphora

Symantec Buys Clearwell for $390M

Law Technology News' recently-hired staff reporter, Evan Koblentz, picked up on the news that information management giant Symantec is in the process of buying e-discovery specialist Clearwell Systems for $390 million -- another significant move in the EDD consolidation game. It follows the news from earlier this week that Autonomy will acquire Iron Mountain's digital service products.

Read the Symantec-Clearwell story on the LTN website.

Autonomy Acquires Iron Mountain EDD assets

Announced today: Autonomy has agreed to buy Iron Mountain's online backup and recovery, digital archiving, and e-discovery assets.

(Note: Weil Gotshal is counsel to Iron Mountain Incorporated in the sale of its online backup & recovery, digital archiving and eDiscovery products for $380 million in cash to Autonomy) 

Here is the un-edited press release: 
 
Iron Mountain Continues to Advance Its Strategic Agenda by Signing Definitive Agreement to Sell Certain Digital Solutions

Boston, MA – May 16, 2011 –  Iron Mountain Incorporated (NYSE: IRM), the information management company, continued to advance its strategic agenda with today’s announcement that it has entered into a definitive agreement with Autonomy Corporation plc (LSE: AU. or AU.L) under which Autonomy will acquire Iron Mountain’s online backup & recovery, digital archiving and eDiscovery solutions for $380 million in cash.  The acquisition is subject to regulatory review and customary closing conditions and is expected to close within approximately 45 to 60 days.

Reed Smith Raids K&L Gates for New EDD Team

Man oh man, I'm offline on a six-hour flight to LA (for LegalTech West Coast) and land to tons of news!

First, Reed Smith snagged 14 professions and formed a new e-discovery and records practice. See next post for #2.

Jamie Moss brings us the 411 about Reed Smith (unedited): (Link to press release here)

"Reed Smith LLP today announced the addition of 14-members to its new e-Discovery practice.  The group will work from the firm’s Global Customer Care Center in Pittsburgh. A majority of the group begins  working today, the remaining members are wrapping up current projects and  facilitating the transition and are expected to be in-house shortly."

"The  Practice Group is led by David R. Cohen, who joined Reed Smith in early May  from K&L Gates, where he formerly co-founded and served as co-chair of  that firm’s e-Discovery Analysis and Technology Practice. Cohen has more  than 25 years of complex commercial litigation experience, with a long-term  focus on e-discovery, automated litigation support and records management  issues All members of the team were formerly  part of the e-Discovery Analysis & Technology (e-DAT) Group at K&L  Gates in Pittsburgh.

Yeah, Right: EDD Took Down Howrey

Our former ALM colleague, Ashby Jones, has been tracking Howrey's implosion for the Wall Street Journal on its Law Blog. A recent post caught my eye, with the headline "CEO Ruyak Partly Blames Contingency-Fees, Discovery Vendors, for Howrey's Fall."  Whaaaaat? 

Jones reports that his colleague Vanessa O'Connell interviewed Robert Ruyak (right) last March, shortly before the firm voted to dissolve. The firm, at its peak, had a roster of about 750 lawyers, and used the slogan "In Court Every Day," to frame itself as a "go-to" lit and IP practice in the U.S. and Europe, she reported.

Ruyak said the slowdown in the litigation market in 2008-09 brought swings in firm profits, triggering defections, and with clients looking to trim costs, the firm tok on more contingency cases, she noted. Another factor was the rise of third party EDD specialists offering lower rates. With the firm's urban operations, it couldn't compete, he told O'Connell.

Commenters weren't kind:

"Shouldn't the Journal be analyzing some of these answers? If what he says in true, every big firm would be collapsing."  —dc

"Funny, I thought it was these big firms that hired the e-discovery consultants." —Utilto

Mary Mack Joins ZyLab

Mary Mack, considered by many to be the "face" of Fios, has defected to join ZyLab, as its "enterprise technology counsel," and becomes part of its leadership team charged with developing their North America business. She will work from the company's California  offices, and start her new post on  November 7,  after more than a decade with the Portland, Ore.-based e-discovery provider as its corporate technology counsel. In addition to working with Fios' clients, she wrote the influential blog, Sound Evidence, and was a frequent speaker on the legal technology circuit. 

TR Buys Serengeti Law, Launches GRC unit

Thomson Reuters has acquired Serengeti Law and has launched a new Corporate, Risk, and Compliance business unit. 

The new GRC unit is housed within the Thomson Reuters Legal division, and lead by David Craig, who assumes the title of president. He previously served as TR's chief strategy officer. 

The new unit brings together several existing brands and products, including Complinet, Paisley, Westlaw Business, West's Capitol Watach, Oden, and Westlaw Compliance Advisor. It targets financial institutions, insurance, and related firms, providing tools designed to integrate business transactions, strategy, and operations, the company says. Services address global regulatory and securities intelligence; business law research; contract and deal-drafting tools; internal policy management; e-learning, anti-money laundering; and audit, filing, board of director, and disclosure. 

Darwin Watch: DTI Acquires Daticon EED

Document Technologies Inc. has acquired Daticon EED, a Seattle-area e-discovery company. The company will now be known as "EED, a DTI company," based in Atlanta.

Effective immediately, it will act as the operating unit supporting current Daticon EED clients. John Davenport Jr., currently president and CEO of DTI, will continue in that role. The terms of the deal "are not, and will not be disclosed," said publicist Amy Juers, of Edge Legal Marketing.

DTI says it now has annual revenue of more than $130 million, including $70 million-plus from discovery services. It operates six large data centers in Atlanta, Chicago, New York, Seattle, Washington, D.C., and Norwich, Conn.  The former EDD Daticon offices in Kirkland, Wash. will be used as a regional technology center.

IE Discovery Buys Majority Interest in eDirect Impact

IE Discovery reports that it has purchased a majority interest in eDirect Impact, the creator of eManage EDD workflow management software.

The investment will provide eDirect Impact with additional funding for development of that software, and gives IE Discovery an exclusive license to offer eManage to corporate and government markets, the companies explain.

Based on Microsoft's SharePoint software, eManage helps organizations connect and integrate disparate EDD products and review tools, including IE Discovery's discovery software, InfoDox.

Release here.

Thomson Reuters Acquires CaseLogistix from Anacomp

Darwin Watch: In what signals a significant move into the e-discovery market, Thomson Reuters has purchased CaseLogistix from San Diego's Anacomp. Terms of deal were not announced. 

CaseLogistix offers document review, data ingestion, and production tools to help litigation teams manage the electronic discovery review process, says TR. "The acquisition is a critical next step in furthering the Thomson Reuters litigation strategy," says Allison Guidette, TR Legal's vice president and general manager of litigation (and formerly an executive with Merrill Corp.) The CaseLogistix team will be under her umbrella.

Tom O'Connor, a long-time member of LTN's Editorial Advisory Board, served as an independent consultant for CaseLogistix from 2006-2009, writing white papers, and conducting webinars and focus groups about e-discovery processes. The acquisition, he says, shows that there's been no slow-down in the efforts of large companies aquiring small EDD firms, in order to create "end-to-end" offerings. "More specifically, this signals to me that TR is serious about that market, and is finally taking steps to counter the immense EDD and litigation support market presence of LexisNexis." 

Unify & Daegis Merging

Unify, a data management and migration software vendor, and Daegis  an e-discovery and litigation support consultancy, are in the process of merging. The new entity, yet to be named, will focus on data archiving, information governance, and EDD, they say.

Under the accord, Unify will pay $38 million in a combination of cash, seller financing, and stock. So far, Unify has paid $24 million in cash, delivered $6.2 million in convertible promissory notes, and issued approximately 2.1 million shares of its common stock to Daegis shareholders.

CT Summation & AccessData Morph into AccessData Group

Darwin Watch: Wolters Kluwer's CT Summation and AccessData have just announced that they have signed the paperwork to merge into a single company: AccessData Group.
   The new company will offer a cradle-to-grave electronic data discovery offering, they report. Currently, AccessData's namesake e-discovery software helps users address litigation holds, automated collection, processing, and analysis prior to attorney review. CT Summation's roster includes litigation workflow and e-discovery products: iBlaze, CaseVault, and Discovery Cracker.
   AccessData CEO Tim Leehealey told Law Technology News that he will remain on as CEO, with his current management team, which includes Brian Karney (COO) and Erick Thompson (founder/CTO), among others. Whether CT Summation leaders will participate on the management team is unsettled at this time, he said. 

Darwin Watch: AccessData, CT Summation

Wolters Kluwer's CT Summation and AccessData have just announced that they have signed the paperwork to merge into a single company: AccessData Group.

The new company will offer a cradle-to-grave electronic data discovery offering, they report. Currently, AccessData's namesake e-discovery software helps users address litigation holds, automated collection, processing, and analysis prior to attorney review. CT Summation's roster includes litigation workflow and e-discovery products: iBlaze, CaseVault, and Discovery Cracker.

AccessData CEO Tim Leehealey told Law Technology News that he will remain on as CEO, with his current management team, which includes Brian Karney (COO) and Erick Thompson (founder/CTO), among others. Whether CT Summation leaders will participate on the management team is "unsettled" at this time, he said.

More on Kroll Acquisition

From yesterday's Law Technology News website:

By Monica Bay

Altegrity today announced plans to acquire Kroll from Marsh & McLennan Companies, in an all-cash transaction valued at $1.13 billion the companies announced. Kroll offers a range of security and technology services, including investigations, financial advice and intelligence, and more.

Altegrity is owned by Providence Equity Partners, a global private equity firm. The transaction is expected to close by September, assuming the usual approvals. Altegrity's CEO Mike Cherkasky served as president/CEO of Kroll from 2001-2004. MMC turned to Wachtell, Lipton, Rosen & Katz for legal counsel; Debevoise & Plimpton aided Altegrity and Providence.

Among Kroll's entities is Kroll Ontrack, which offers a range of services, software, and consulting to help legal, corporate, and governmental entities (and consumers) deal with data, including data recovery services. Kroll Ontrack has a high profile in the e-discovery community; it ranked as a top 5 overall services provider in the final Socha/Gelbmann e-discovery survey in 2008. In the same survey, it ranked in the 11-15 category for its software.

Iron Mountain Acquires Mimosa

From the press release:

Iron Mountain, an information management services company, has acquired Calif.-based Mimosa Systems, [which offers] content archiving [systems], for approximately $112 million in cash, subject to closing adjustments. The deal provides Iron Mountain with an integrated archive for e-mail, SharePoint data and files, and gives the company an on-premises archiving option to complement its existing cloud-based archives.

What do you call someone who gets the lowest passing grade on the Bar exam?

Guest lecturing at an e-discovery class at UT Law School today left me feeling a tad discouraged.  I'd covered the fundamentals of data storage, the broad components of an enterprise IT environment, Unicode and a bit about keyword search.  In 50 minutes, there's only so much I can do, and with little depth or nuance.  Afterward, a third-year student in the class confided that he'd thought I'd gone pretty far "into the weeds" and wondered if he would really need to know this stuff.  He asked why he couldn't just hire someone to handle the e-discovery issues in his cases.

Anacomp Executive Purge?

We are tracking down strong rumors that there has been a major purge of executives at Anacomp by its board of directors. Once we get confirmations and details we'll post more 411.

411: We tracked the rumor down. In fact, Howard Dratler, Anacomp CEO, got right back to us to set the record straight. There were never any plans to unseat him as CEO. But Dratler did hire Scott Winkler to be the general manager of Anacomp's CLX business. According to Dratler, "Winkler's initial focus will be on better alignment of our Development, Product Management and Marketing organizations with the goal  of building on/accelerating the strong progress we have made over the past several years and taking our eDiscovery and Litigation Support business to the next level."

Cloud BURST!

There's been a lot of chatter about cloud computing, and I've certainly touched on the risks.  Now, we have a concrete example of what can go horribly wrong.  T-Mobile users of the Sidekick smartphone may have lost all of their personal data when master copies were affected by a server outage.

Microsoft, you got some explaining to do!

EMC To Acquire Kazeon

EMC Corp. has announced that it will acquire e-discovery provider Kazeon Systems. Kazeon will become a part of EMC's content management and archiving division upon completion of the acquisition. Full release here.

Deacon & Reichenbach Land New Gigs

Babs Deacon has joined Integreon, Mark Reichenbach's aboard Capital Legal Solutions. 411 here

The End of Lawyers?

Keep your seatbelt fastened!  Richard Susskind's latest book, "The End of Lawyers?", is a must read.  While its scope is much broader than issues surrounding electronic discovery, it discusses the profound impacts that technology is having in the practice of law.  Rapid and disruptive change is underway; how will we adapt?

#LTNY: Darwin Watch: The Day After Christmas

I am out of the office today, so didn't see this until now when Craig Ball, LTN's trusty EDD columnist, brought it to my attention: Onsite3 has filed for Chapter 11 and plans to be absorbed by Integreon.

"You know how ailing retailers hang on until Christmas before deciding to throw in the towel?  Well, for the thinning ranks of e-discovery vendors, LegalTech New York is Christmas, and you can bet that anyone hitting the skids who didn't manage to save face through a fire sale acquisition negotiated in the halls of the Hilton is running out of options." 

 

"In 2009, some will be able to buy their EDD service provider for what they paid for services in 2008, and those who thought me a Cassandra in the February LTN column "What Lies Beneath" will soon wonder why I didn't ring the bell louder."

As for Onsite3's woes, the press release is available here.

Cliff's Notes version:

"Onsite3... today announced that it has filed for reorganization under Chapter 11 ... and that it plans to be acquired by Integreon (www.integreon.com).... The Company also announced today that Integreon has completed the acquisition of Onsite3's outstanding pre-bankruptcy secured debt and has agreed to provide debtor-in-possession financing to assure Onsite3's continued operation throughout the reorganization process."

What Lies Beneath?

With he news of layoffs at two EDD providers (i365/Metalincs and SPi), I thought you might want a sneak preview of Craig Ball's column "What Lies Beneath."

Ball warns us to be sure we have considered how to protect our firms and clients should a vendor evaporate.

View it here or download it here: Download Ball_In_Your_Court

Layoffs at SPi

The grapevine is humming about layoffs at SPi -- and possible reorganization (jettisoning EDD work) -- but no official statements yet. Will keep you posted as we hear more.

Autonomy to Acquire Interwoven

Breaking news: http://www.autonomy.com/content/News/Releases/2009/0122.en.html

1/26 Update: According to the company:

• Interwoven stockholders will receive $16.20 in cash for each outstanding Interwoven share, representing a premium of 36.8% to the closing share price of $11.84 on January 21, 2009, and a premium of 36.2% to the average closing share price over the 30 days through January 21, 2009.

Interwoven Buys Discovery Mining

One SF Bay Area company has gobbled up another: Peninsula-based Interwoven Inc. has announced that it will acquire Presidio (SF)-based Discovery Mining:

EED Buys Daticon

Electronic Evidence Discovery Inc. has announced that it has reached a definitive agreement to purchase Daticon, LLC. (Daticon was earlier purchased by Minnesota's Xiotech.) Press release here.

Aptara Sells Lit Support Division to Ivize

Ivize, a legal document services firm, has purchased Aptara Inc.'s litigation support business. To find out more, download the release and read Rob Robinson's commentary here.

Seagate acquires MetaLincs

Today, Seagate Services, which provides backup, recovery, and e-discovery, has signed an agreement to purchase MetaLincs, an EDD company. Find out more about the acquisition here.

Iron Mountain acquires Stratify

Iron Mountain Inc. has paid approximately $158 million to acquire Stratify Inc. To read more, visit the press release.