Securities Enforcement Tips

Securities Act

For firms involved in securities act cases, there are many documents to review prior to sending them out in response to discovery requests. Certain documents are protected by confidentiality rules, especially documents that are considered attorney-client privileged. Attorney-client privileged documents are documents between the attorney and the attorney's client and are not discoverable.

If a document that is not discoverable is inadvertently provided to opposing counsel, it opens the door for requests for other confidential documents related to the document sent.

Document review is a time consuming process. Attorneys hire temporary attorneys that are provided by legal staffing agencies. The attorneys are experienced in securities act cases. They are trained in document review procedures, and can review many documents in an expeditious manner, thus saving the firm hours of time and allowing the firm to spend time on other aspects of the case or with other clients.

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Insider Trading and Securities Fraud Enforcement Act

The Insider Trading and Securities Fraud Enforcement Act (ITSFEA) re-codified the Insider Trading Sanctions Act of 1984 to make it Section 21A of the Exchange Act. Under the ITSFEA, a monetary penalty of up to three times the amount of the gained profit that was gained or the loss that was avoided during the sale of a security while the seller was in possession of material that was considered to be non-public in nature.

In 1988, the ITSFEA was amended to make the penalties applicable to controlling persons and also to include people who violate the Act by disseminating the information.

Law firms that are involved in insider trading and securities fraud cases are inundated with a large amount of documents during the discovery phase. Discovery requests must be responded to, but before any document (electronic or otherwise) leaves a law firm, it must be checked for confidentiality and privileged information. Since this can be a time consuming task, many attorneys retain experienced, temporary document review attorneys. The temporary attorneys are provided by legal staffing agencies and are experienced in the needed field (such as the insider trading and securities fraud field) and in document review.

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Litigation Support Company

A litigation support company provides litigation support in the form of document review services for securities enforcement cases. Prior to the discovery phase, the attorney must review all documents for confidentiality issues and for documents that fall under attorney-client privilege rules.

The document review attorney reviews the documents and, under the supervision of the lead attorney on the case, separates the confidential documents. If it is a large case, a document review manager and team might be assigned to the case. The document review team organizes and reviews the documents that are being sent in response to discovery requests.

The litigation support company might also be retained to review incoming discovery documents. These documents are in response to the attorney's request for production, interrogatories, depositions, and requests for admissions. The document review attorney reviewing incoming discovery looks for confidential documents inadvertently provided by opposing counsel.

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Legal Process Outsourcing Services

A legal recruiting firm provides legal process outsourcing services in legal fields including securities enforcement. Law firms often use temporary legal help when they are hired by entities for large lawsuits, whether for defense or plaintiff work. Firms may also hire temporary legal help when an employee is on sick leave, family leave or vacation.

Securities enforcement cases often involve extensive documents. To make working with these cases easier, a legal document and outsourcing services firm can digitize documents. Staff, including temporary staff then easily finds documents required for discovery, interrogatories, admissions, settlement negotiations, hearings and trials. The documents are assigned keywords and indexed.

Documents are also reviewed by legal process outsourcing services personnel. The documents can be marked as discoverable or as falling under attorney-client privilege and not discoverable. If needed, documents can also be reviewed by a forensic document reviewer for inconsistencies and forgeries.

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Forensic Document Services

A legal staffing agency provides forensic document services for securities enforcement. Forensic document services includes checking documents for alterations in pages or sections (addition or removal), forged signatures or adding in a document with an original signature that belongs to another documents, among other things that show a document is forged. Forensic document examiners that provide forensic document services are trained before being dispatched on each job in order to provide the best service for each client.

Forensic document examiners are trained to look for specific discrepancies in securities enforcement and other legal fields. If a forensic document examiner finds one or more altered documents, all documents pertaining to that particular case should be checked, even documents provided by your own client to ensure there are no other discrepancies that will throw a surprise at you during settlement negotiations, hearings, or the trial.

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