Many IBOR remediation projects raise a basic question: How do you find, collect, review, and remediate the right contracts? A company might have thousands of contracts that need to be repapered, and those contracts might be scattered throughout electronic file systems and hardcopy records.
Fortunately, litigators have spent the past few decades wrestling with very similar questions, which crop up in the discovery process in any large-scale modern litigation. As the number of discoverable electronic documents exploded over time, litigators began developing sophisticated processes for finding, collecting, and reviewing them so that they could be produced to opposing counsel or used at trial. Those time-tested e-discovery techniques can be applied to IBOR remediation projects.
An important distinction, however, is that while discovery and IBOR remediation involve many similar techniques, the two differ in their goals. In discovery, one of the primary goals is (unsurprisingly) to comply with discovery obligations. Those obligations do not hold litigators to the standard of perfection. Instead, a party is generally required to produce all the responsive documents that turn up with a “reasonable inquiry.” Thus, the overall measure of a document production is “reasonableness” as opposed to a Platonic ideal of “perfection.”
Not so with an IBOR remediation. There, we strive for a higher level of accuracy. Ensuring this high level of accuracy requires added diligence at all stages of the project. For example, when trying to locate all contracts that need to be amended, it typically will be better to err on the side of over-identification, even if that means that the review population includes a relatively high percentage of documents that do not contain IBOR provisions. As we explained in our prior blog post, IBOR: A New Frontier for Digital Contract Management, employing a modern contract-management tool also can be expected to increase accuracy. Finally, when contracts actually are amended, the related remediation workflow should have sufficient safe-guards in place (such as a rigorous Quality Control process) to ensure that mistakes are avoided.
With the cessation of LIBOR on the horizon and thousands of contracts at stake, we expect the decades of experience of litigators with e-discovery tools to be very helpful in aiding the transition.