Office E Mail: It Can Zap You In Court

Casual messages can come back to haunt companies

Bill Gates has discovered what CEOs around the globe are just starting to grasp about E-mail: It can--and will--bite. E-mail messages dashed off years ago by the Microsoft Corp. chairman and his top lieutenants now figure prominently as digital "smoking guns" in the Justice Dept.'s landmark antitrust case against the software giant. Trustbusters say electronic messages, perhaps more than any paper document, could help them prove that Microsoft sought to crush competitors and monopolize access to the Internet. "E-mail discovery has got everybody really scrambling," says Nina Bondarook, a Microsoft spokesperson.

And not just at Microsoft. As more and more businesses use E-mail to revolutionize their links to clients, suppliers, and customers, they're facing a whole new Information Age challenge: how to take advantage of vast new levels of communications without getting tripped up by the informal, candid, and sometimes inflammatory missives it can foster. Just last March, for example, Morgan Stanley Dean Witter & Co. agreed to settle a discrimination suit brought by two of its employees. The smoking gun: an E-mailed joke, playing on stereotypes about African-American speech patterns, that a colleague had zapped around the office.

This could be just the beginning of what businesses can expect. In the past two years, the growing use of E-mail has made it easier for workers, clients, disgruntled business partners, and regulators to file lawsuits in cases alleging everything from sexual discrimination to stolen trade secrets. Already, some 66 million people use E-mail in U.S. corporations, and that's expected to explode to 100 million by 2000, according to International Data Corp.

Combine this with data that show many companies have yet to recognize their E-mail vulnerability, and it's a recipe for a surge in litigation, experts say. A November, 1997, survey of 800 corporate human resource managers found that barely half, or 52% of the companies polled, had written policies governing E-mail use--and, of these, only a quarter actually were enforcing them. Just 51% are training workers in appropriate use of E-mail. And fewer still, roughly 15%, are treating E-mail the same way they do paper documents when it comes to saving and retrieving information. Says Barry Lawrence, a spokesman for the Society for Human Resource Management, a trade group in Arlington, Va.: "We've got to instruct people, from the boardroom to the mailroom, but I'm not sure we're there yet."

PURGES. Indeed, there are no rules of the road for handling E-mail--yet. Experts say, however, that until guidelines are established the best advice is for companies to deal with E-mail the same way they do paper--keep important material and purge the rest. "About the best you can say is that courts don't want the E-mail about where you want to meet a co-worker for lunch today," says Internet law expert Leo L. Clarke, a partner at the Seattle office of Gordon & Polscer LLP. "But E-mail that helps to describe new product development or answer how something was designed might be what you want to keep."

But how long must you keep it? There is no surefire answer there, either. Some firms are dumping E-mail every 30, 60, or 90 days, while others are stashing everything. Some companies are instead printing out E-mails they think might be important. But even paper copies may not be adequate as a legal record: Printouts don't provide enough tracking information and can be taken out of context.

Deleting E-mail is no solution, either. Backup tapes are often kept that contain information that's been sent to your electronic trash bin. Moreover, judges are increasingly ready to penalize companies they think haven't done enough to save or uncover E-mail. In a patent lawsuit against Sprint Corp., the company was penalized for "spoilation of evidence"--for not keeping E-mail and other documents that were relevant to its business practices.

The result: Many companies, including Microsoft, keep much of their E-mail--with no way to manage it all. Says Bob Williams, president of Cohasset Associates Inc., a Chicago consulting firm: "My clients describe the management of their E-mail to me in one word: chaos. Managing E-mail is just not happening at most firms today, and it's creating enormous risks."

So what's keeping companies from tackling the E-mail monster? Part of the problem may be cultural. Companies worry that monitoring E-mail will trigger employee complaints of Big Brother in the workplace. Tech companies especially tend to view their open E-mail environments as critical to their creativity and are loath to regulate it in any way. "E-mail is fundamental to the way we do business," says Jeffrey S. Raikes, a Microsoft vice-president. "I don't think twice when I'm writing E-mail. In fact, if I start looking over my shoulder every time I think about putting new stuff into the software, then we'll fail."

The cost of managing E-mail may also be an obstacle. Large firms can spend months, and hundreds of thousands of dollars, setting up whole new records management systems, policies, and organizational structures to handle their growing E-mail influx, says Internet law expert Clarke. As expensive as that is, though, it may be cheap compared with the alternative. Some ill-prepared companies have spent upwards of $1 million or more to comply with E-mail discovery requests, according to Joan Feldman, president of Computer Forensics Inc. in Seattle, a five-year-old company that helps attorneys mine computerized data in litigation.

Part of the problem may be that companies simply don't know where or how to begin. "What E-mail is appropriate? What isn't? How long do you keep it?" asks Mary Hodges, a spokeswoman for the Association of Records Managers & Administrators Inc., a group of more than 8,000 industry and government data experts.

Hodges' group is scrambling to devise national standards. Due this fall, the guidelines will offer ways to cope. Included in a draft copy is a suggestion that companies might "wish to destroy magnetic media on which E-mail is stored, in order to preclude the recovery of highly sensitive deleted messages" and a warning: "E-mail systems are subject to the same requirements as any of the other records of an organization."

DIGITAL GOSSIP. In the meantime, some corporations are turning to employee training programs and drafting their own strict E-mail policies. At Prudential Insurance Co., for example, workers are prohibited from using company E-mail systems to share jokes, photographs, and nonbusiness information of any kind. The company enforces the policy by auditing message traffic. Merrill Lynch & Co. requires each employee to sign off on the company's E-mail policy and hosts informal meetings with employees to go over basic use guidelines intended to counteract people's natural tendency to think their E-mail is confidential. "Despite years of telling workers their E-mail isn't private, we're still seeing the kind of conversation that used to take place by the water cooler and in the bathroom and over lunch and in the elevator or inside someone's private executive office now taking place via E-mail," says Howard A. Besser, an information management professor at the University of California at Berkeley.

Other companies are turning to software for help. Citibank, Lockheed Martin, and General Electric have installed Cipher Logics Corp.'s SecureDelete electronic shredding program on thousands of laptop computers in the field. Others use E-shredders with such names as SecureDisk, Burn-It, and Terminator to obliterate E-mail that could haunt them later. Hughes Hubbard & Reed LLP, a New York law firm, is developing software called MailCop that uses artificial intelligence to issue warnings over workers' computer screens, alerting them when they have written or received E-mail that could violate company rules. Says Carol Basri, executive director for the American Corporate Counsel Assn. in New York: "MailCop is like having your mom with you, right there, telling you not to say bad words."

There is an added incentive to destroy superfluous E-mail: Without routine message-purging, some companies find their computer systems clogged to the point of disruption. A Gallup Poll in May found that a typical office worker sends and receives an average of 60

E-mails a day. "Multiply that by 4,000 workers, and factor in that kind of volume for a month, and you're talking about a major glut here," says Paul Saffo of the Institute for the Future, the Menlo Park (Calif.) technology think tank that commissioned the study.

The print message here: If companies fail to manage their electronic messages, today's digital headaches will become tomorrow's migraines. Just ask Bill Gates.

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