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Practical Advice for Effective eDiscovery in Japan

Asian Briefings

With multinational companies spreading throughout the world, it is increasingly likely that foreign companies will face litigation in US courts that requires the gathering of evidence abroad. With language differences, cross-border discovery in support of US litigation has always been difficult. Adding to the complexity is the discovery of foreign-language electronically stored information (ESI), particularly information recorded in non-Romanized languages, such as Chinese, Japanese and Korean. Companies gathering evidence from businesses in these countries face a host of technical, procedural, business and even cultural issues. Not much practical information is available for corporate counsel in the United States to navigate the thickets of Asian eDiscovery.

A new book by Masahiro Morimoto, President and CEO of UBIC, Inc., and Chairman and CEO of its US subsidiary, UBIC North American, Inc., attempts to fill the void of information about Japanese eDiscovery. The book is entitled "eDiscovery – Japan: A Pathway for U.S. Attorneys to Do Business with Asian Corporations," and was published by Global Try in February 2014. The book focuses in particular on gathering ESI in Japan and the challenges associated with it. The primary audience is US attorneys and law firms, and the purpose of this article is to summarize some of the key points made in Morimoto's book.

Challenges for eDiscovery in Japan

The most obvious challenge for gathering electronically stored information in Japan is the fact that most ESI is likely to be in Japanese. eDiscovery in Japan is difficult in part because the process of collecting and translating Japanese-language computer-based ESI is more complex than copying and translating Japanese text in paper form.

First, the encoding of Japanese characters for machine storage, processing and display is more complicated than that for Romanized languages. A simple example is the fact that the letter "a" in English is one byte of data. By contrast, translating a Japanese character may take two or more bytes. Adding to the complexity is the fact that Japanese writing has three types of symbols — the hiragana and katakana syllabaries, and Chinese characters. Each must be encoded for use with computer systems. A failure to encode Japanese text in a standardized way, or in the process of collecting information, or the failure to use the right tools, may result in the garbling of Japanese-language characters when they are reviewed or translated. In addition, it is sometimes difficult to distinguish separate words in Japanese. Again, the result may be garbling characters upon collection, review or translation.

Second, the practical question will arise as to whether it is best to conduct a relevance review of ESI that might be responsive to a request for production before translation to English, or to translate to English first in order to review for relevance. Morimoto strongly recommends review in Japanese before translation. His point is that translating the entire universe of potentially responsive ESI incurs the costs of unnecessary translation, greatly increasing eDiscovery costs. If the relevance review is conducted in Japanese before translation, only the responsive documents need to be translated, greatly reducing cost. Moreover, relevance review in Japanese reduces the risk that a bad translation leads an English-language reviewer to identify irrelevant documents that might harm the client's case as responsive or fails to identify relevant documents that are responsive.

In addition to the challenges from the difference in language, Morimoto mentions a number of technical issues. The eDiscovery support industry generally lacks technology tools that are specifically tailored for the Japanese language. He makes the point that the use of English-language tools is not effective for Japanese eDiscovery. Furthermore, he identifies a problem that would not be obvious to US attorneys — the fact that Japanese companies commonly develop their own software applications for internal use instead of using standardized off-the-shelf software. Imagine in the US eDiscovery context if support service providers had to account for the fact that a large percentage of their customers don't want to use Microsoft Word, and therefore, have developed and use their own word processing software. With a diversity of custom, non-standard software comes a large diversity of file structures and formats.

Not only do technical issues pose an obstacle to Japanese eDiscovery, the Japanese business context also presents its own set of challenges. Morimoto talks about the general lack of knowledge about eDiscovery among Japanese businesspeople and, in particular, the unfamiliarity with the litigation process generally. The Japanese legal system does not have procedures for pretrial discovery equivalent to that in the US courts, and even the concept of a "trial" is very different from that in the United States. This lack of familiarity with US-style litigation also creates misperceptions about US attorneys, especially given news stories and perceptions concerning scorched-earth litigation tactics. Another business concern is the lack of familiarity in Japan with procedures taken to protect the confidentiality of sensitive business information. You may find that your Japanese colleagues are unfamiliar with both procedural controls and technology used to prevent unauthorized access or disclosure to sensitive ESI.

Practical recommendations for effective eDiscovery in Japan

At a high level, Morimoto recommends, first, working with an eDiscovery service provider that can effectively support Japanese-language eDiscovery. Second, he stresses that US attorneys should understand the business and social customs of Japanese companies. As discussed in the next section, he provides some specific criteria to use when choosing a Japanese-language eDiscovery support firm. He also provides some information about the Japanese social context and customs, which is useful even outside the eDiscovery context.

Morimoto makes a series of specific recommendations concerning effective eDiscovery in Japan. First, he talks about conducting preparatory steps before the eDiscovery process begins to organize and streamline the process. He talks about understanding the company's IT systems and infrastructure, the company's information security practices and technology, and its use of Japanese-language data encoding software. In addition, he recommends a pre-preservation meeting to discuss how best to preserve potentially responsive Japanese-language ESI.

Second, Morimoto talks about the use of eDiscovery tools and associated procedures. For instance, he mentions Japanese-language capable forensic tools as an important element of effective ESI identification. In addition, he describes effective keyword searching in Japanese. The use of native Japanese speakers to develop lists of keywords will make the keyword-searching process more efficient and less costly. Attorneys attempting to create their own keywords without the assistance of native Japanese speakers may result in flagging large numbers of irrelevant ESI or missing responsive ESI. Accordingly, the support of an effective eDiscovery service provider with Japanese-language capabilities is crucial.

Third, Morimoto discusses managing the ESI review process in a Japanese-centric way. Many US service providers can provide cost-effective English-language relevance and privilege review operations. In Japan, however, it is important to recruit Japanese-language reviewers with the ability and experience to conduct ESI reviews, and train them about the litigation process and the importance of maintaining the confidentiality of the ESI being reviewed. It is important to monitor and assess reviewers as the review is taking place in order to ensure effective and efficient work. Reviewers should have a comfortable working environment. Finally, Morimoto recommends having Japanese ESI reviewed in Japan, rather than the United States. Reviewing ESI in Japan makes it easier to recruit the requisite number of native speaker reviewers, which sometimes number in the hundreds on big cases. Moreover, a Japanese-language relevance review also means that irrelevant ESI can be culled before translating begins, thereby reducing the universe of ESI that needs to be translated and driving down costs.

Fourth, Morimoto discusses other suggestions for effective eDiscovery in Japan. In addition to eliminating unnecessary translation costs, he talks about the need for reviewers and the eDiscovery support team to respond quickly to the needs of the client and its litigation counsel. Litigation is fast moving. Accordingly, deadlines come up, instructions from litigation counsel may require a fast turnaround, and instructions may change. Further, service providers will need to handle multiple data formats that they may encounter in the Japanese business context, especially given the plethora of custom applications. Moreover, US attorneys should be aware of the increasingly demanding environment in which clients seek to contain costs and may even seek the reduction of fees from outside service providers. Morimoto emphasizes how counsel and service providers should seek to inform clients about solutions they can bring to bear that would hold down the costs involved with eDiscovery. Demonstrating the value and quality of services will also improve client understanding about the level of fees and costs.

Finally, Morimoto devotes a chapter to developing good relations with Japanese businesspeople to enhance cultural understanding, which he hopes will help attorneys provide better services for their Japanese business clients. He talks about Japanese business and social customs that may affect US service providers. For example, he talks about the differences in communications style between businesspeople in Japan and the United States. Businesspeople in the United States may sometimes speak directly and assert their positions, even if it causes a disagreement. By contrast, Japanese businesspeople may seek to use indirect or roundabout communications, in part to avoid the appearance of conflict.

Morimoto mentions the lack of preparedness and experience with litigation US service providers may encounter among Japanese businesspeople. People in the United States may also need to educate their Japanese counterparts about the need and means for protecting sensitive business information. In addition, they may need to help Japanese businesspeople overcome the uncertainty and fear about litigation. US attorneys, in particular, may face some preconceptions about what lawyers in the United States are like. Morimoto even offers advice about conducting business and social meetings with Japanese counterparts to promote cultural understanding and, therefore, conduct business more effectively.

Morimoto envisions a strong partnership between an eDiscovery service provider and US attorneys supporting litigation in the United States. A service provider specializing in Japanese-language eDiscovery can provide more effective and less costly service than a more general service provider. He even sees a Japanese service provider as a means of building a bridge between US-centric attorneys and their Japanese clients.

Choosing an eDiscovery support services provider

A business with operations in Japan facing the prospect of producing ESI for American litigation should undertake a due diligence process when selecting an eDiscovery support services provider. It should keep in mind that a service provider's advertisement of general "multilanguage capability" does not always translate into effective Japanese-language eDiscovery capabilities. Furthermore, an eDiscovery service provider cannot simply use English-language tools for Japanese-language ESI in a "one size fits all" approach.

Morimoto identifies several criteria for judging Japanese eDiscovery service providers. First, a service provider should have experience in handling discovery from Japanese companies. You should ask your potential service providers about their experiences in collecting, reviewing, translating and presenting Japanese-language ESI. Second, a service provider should have the requisite technical competency with services specific for Japanese companies. For instance, it should have effective forensic skills to collect and preserve Japanese-language ESI. Also, a service provider should be able to support the collection and processing of data from a wide variety of custom applications. A service provider may need to provide custom programming to handle different file formats. Third, you may be able to tell a lot about a potential service provider by seeing whether or not its representatives ask you the right questions about your technology and business systems and procedures.

Fourth, a service provider should be able to provide Japanese-centric services. Some of the factors to consider include:

  • the degree to which the service provider understands Japanese culture and works well with Japanese clients, especially the discovery manager handling the project;
  • whether the service provider's support specifically focuses on the needs of Japanese businesses;
  • whether the service provider can host ESI and perform all processing and review work entirely in Japan, perhaps to help meet regulatory concerns about the privacy of ESI, such as data received from the client's Japanese customers; and
  • whether the provider can handle encoded Japanese-language files efficiently and effectively.

Asking about prior case experience with specific examples (subject to the need to protect the service provider's client confidences) will help you gather information about these factors. Morimoto also touches on the topic of emerging automation technologies that will provide value for companies conducting Japanese eDiscovery in future projects. In particular, technology-assisted review (TAR) has the potential of saving the cost of human review of ESI. TAR uses a process known as predictive coding, which enables an ultra-high-speed review of ESI. According to Morimoto, TAR is estimated in some cases to be 4,000 times faster than human review. Some studies show that TAR is even more accurate than human review. Given the effectiveness of TAR, Morimoto predicts that TAR will dramatically change the management of ESI review in the future. The lesson here is that you should also ask your service provider about Japanese-language TAR capabilities in planning future eDiscovery projects.

Lessons for in-house counsel

Morimoto provides specific advice to US outside lawyers providing litigation services to clients required to conduct Japanese eDiscovery. Much of his advice, however, can assist US in-house attorneys as well. For instance, in-house attorneys managing Japanese eDiscovery projects should be aware of the challenges for eDiscovery in Japan. They can help to manage eDiscovery projects more effectively if they know the technology and business issues entailed by Japanese eDiscovery. In-house attorneys can also facilitate the communications process with Japanese colleagues. Your Japanese colleagues will likely trust you, as in-house counsel, more than litigation counsel, given your ongoing relationship with the client and the familiarity that relationship entails.

Further, in-house attorneys can instruct and direct litigation counsel in choosing an eDiscovery support services provider and managing the project. Specifically, they can work with litigation counsel to ensure that Morimoto's criteria for effective service providers become part of the due diligence checklist when it comes time for hiring a service provider. His advice would suggest becoming intimately involved in the hiring process. A hands-on approach will help decide on an appropriate service provider.

Finally, in-house attorneys can work with litigation counsel to manage projects in a Japanese-centric fashion and not simply hand projects to litigation counsel with the assumption that counsel will handle it in the most efficient way. In-house counsel for companies with a Japanese connection are more likely to know Japanese culture well. Accordingly, they can work together with a service provider and litigation counsel to bridge cultural gaps and ensure optimal management of the process. The partnership that Morimoto envisions between US litigation counsel and the service provider should also encompass in-house counsel. In-house counsel can assist in the management of a service provider when it collects and processes Japanese-language ESI, assist in the recruitment and management of reviewers, oversee the security and hosting of ESI in Japan, and work together on production with litigation counsel.

In sum, Morimoto's book provides vital insights for US attorneys supporting Japanese eDiscovery projects. He presents information about the technical, business and cultural obstacles to eDiscovery. He provides recommendations on increasing the efficiency and effectiveness of eDiscovery management, while managing eDiscovery costs. Morimoto talks about how a Japanese-centric eDiscovery service provider can add value, especially in promoting good working relationships between US attorneys and their Japanese clients. Finally, he touches on technology-assisted review and the potential for automation to increase accuracy and cut costs. With increasing globalization, his advice is timely and helpful for multinational companies seeking new ways to manage their US litigation effectively while cutting costs.

About the Authors

Paul Starrett is Counsel and Chief Global Risk Officer at UBIC, North America, Inc.
Stephen S. Wu is Senior Counsel at Chevron.


The information in any resource collected in this virtual library should not be construed as legal advice or legal opinion on specific facts and should not be considered representative of the views of its authors, its sponsors, and/or ACC. These resources are not intended as a definitive statement on the subject addressed. Rather, they are intended to serve as a tool providing practical advice and references for the busy in-house practitioner and other readers.