A legal hold notification plan is “nice- to-have,‟ but not legally required.

In our era of e-mails and electronically- stored information (“ESI”), all companies must have a plan for storing and preserving ESI, particularly when faced with litigation. The risks of not having a well-established legal hold plan can be severe, including creating undue leverage for the opposition, in- creased settlement costs, greater risk of sanctions and losing cases. Notifying record custodians in writing of their duty to preserve data is now a requirement of reasonableness and good faith, and the courts are continuing to affirm this practice by sanctioning those who fail to do so. Additionally, the courts are looking for detailed audit trails about the hold implementation and affirmative custodial responses of compliance. The Sedona Conference® Commentary provides the basic frame- work for proper legal hold implementation. These Guidelines pertain to the implementation of a legal hold plan with some general guidelines. Guide- line 8 provides that a hold is most effective in written form “in a manner that ensures the recipients will receive actual, comprehensible and effective notice of the requirement to preserve information.” Furthermore, organizations are advised to “consider requiring confirmations of compliance with legal hold notices as a means of verifying that recipients understand their preservation duties and obligations.”