Six months after new federal e-discovery rules took effect in the U.S., some businesses are still unclear on what they have to do to comply.

Under the Federal Rules for Civil Procedure (FRCP), which took effect Dec. 1, 2006, businesses need to have policies in place on how they will produce electronic documents they hold in the event of a federal court lawsuit.

But an analyst with the research firm Gartner Inc. says it may take "many more years" for companies to come fully into compliance.

"Some of them are lured into a kind of false sense of security," said John Bace, senior vice president of research at Gartner. "They think, 'We have only had to do e-discovery one or two times in the last 10 years so I don't know if we need to go through all of this rigamarole.''

Large enterprises usually have systems in place because they get sued a lot, said Bace. While some firms are diligently implementing changes, others aren't paying enough attention to these issues.

Xiotech Corp., a vendor of file management technology, said that in a survey of 166 businesses conducted in March and April, only 39 percent said they had a system in place for document "holds," a demand that they protect important information from being deleted. Less than 25 percent said they had taken steps to comply with the new FRCP rules.

But companies can be hit with an e-discovery order regardless of their size. Forty-seven percent of U.S. companies with 20,000 or more employees, and 56 percent of those with between 1,000 and 4,999 employees, received document discovery orders in 2006, according to Enterprise Strategy Group.

When crafting their FRCP policies, companies need to delineate how they store and retrieve electronic documents, including e-mail messages, voicemails and even instant messages. If hit with a lawsuit requesting e-documents, companies have to meet soon after the filing to present an inventory of what electronic documents they have that may be relevant and say how quickly they can produce them.

Burgess & Niple Inc., a civil engineering firm in Columbus, Ohio, is "close" to reorganizing all its digital records, said Fred Mau, the firm's chief technology officer.

Mau, who began streamlining the company's data storage long before the new rules took effect, realized he needed a better way to organize e-mail.

The IDG News Service is a Network World affiliate.