Lawsuits happen every day, and the best way to cover yourself is to keep meticulous records. Those records can cost you extra time and money, however, if come time to use them, they are hard to find.
A real-world example of this is a case where an employer tried enforcing a non-compete agreement.
An employee left the company to work for a business that didn’t compete with the former company, but it did compete with the former company’s customers. The plaintiff had to build a case that its customers’ business would suffer, and in turn, hurt the plaintiff’s business.
To build a case, the people had to search through dozens of boxes of documents that went back three years. They searched for manufacturing records, product design review notes, internal correspondence, specifications, manufacturing instructions, and quality records of all applicable products. This team of people had to find anything and everything they could to prove that what the former employee knew could help the defending company and hurt the plaintiff.
The employee’s legal team also spent weeks searching boxes of documents. They needed to know how secret the “trade secrets” were and who else had non-compete agreements. Both sides of the case wasted a lot of time searching through boxes of paper. Had everything been in a searchable electronic format, it would have saved everyone heaps of time and money.
Feeling that the interpretation of the agreement was too broad, the judge did rule in favor of the employee. Of course, no amount of documentation would have changed the verdict.
Regardless of the case, any lawsuit is a costly ordeal. Opposing sides in litigation will try any number of tricks to discredit each other. Sometimes a tactic is to “bury” the other side with requests for information.
Businesses can get dragged to court for a number of reasons, like:
- Sexual harassment
- Wrongful termination
- Workman’s comp
- Constructive discharge
- Many more
This isn’t to say that company should digitize all its paper documents just in case it ever goes to court. The idea should be considered, though, when weighing out whether converting to electronic data is right for your company.