Cosgrove Consulting Group


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Forensic services have two meanings in software engineering consulting practice. The first is the engineering support provided to the legal system, usually as an expert witness or consultant in litigation. The second meaning is the concern that all software professionals should have for the forensic (i.e., litigation potential) implications of their work. CCG offers forensic consulting in both areas.
Forensic support involving litigation usually fits into the following categories:

Project Disputes
- Contractual or requirements dispute
- Cost/schedule overrun
- Unacceptable performance or quality
Disputes Involving Computers

Key issues involving complex technology – Explaining the unexplainable
Critical evidence resident in computer
Computer-related human or economic loss

In order to avoid potential litigation, a noted researcher, H. W. Lawson, (reference 4 in the Software Engineering and Litigation article below) proposed a method to define the engineering processes used to develop software-intensive, safety-critical systems. Simply stated, the method assumes -- a priori -- that legal action has been brought against the product about to be produced. Then “all reasonable steps” must be present in the engineering activities to defend against the action. Demarco & Lister (reference 1 in the Software Engineering and Litigation article below) suggest a similar strategy in that “the things done to win a litigation … also are … the principle things that should be done to avoid litigation.”

For more discussion on either type of forensic support or for a longer treatment on the subject of Software Engineering and Litigation, refer to the following article:
	Software Engineering and Litigation – Offers a specific framework to include in the development process which minimizes the risk of litigation. (PDF, 46KB)
For examples of an actual document produced in support of litigation see the following:
	Exemplar Deposition Questions – Shows how questions are proposed for examining counsel preparing for deposition involving technical issues. (PDF, 14KB)
	Exemplar Summary Points – Shows how an opinion summary prepared prior to an expert’s deposition’s can clarify issues for entry into the record. (PDF, 14KB)
	Exemplar – Report showing results of source code comparison to determine reuse of software intellectual property (PDF, 121KB)
	Proposed Model Rule on Electronic Discovery – Draft guidelines for discovery of computer-resident evidence (PDF, 373KB)
	OBA E-Discovery Guidelines - Ontario Bar Association overview of electronic discovery guidelines, published in the Sedona Principles. (PDF, 189KB)
	Sedona Principles EDiscovery - Principles for electronic discovery. (PDF, 643KB)

Software/Intellectual Property Valuation
The need for establishing a reasonable business valuation of intellectual property occurs frequently in litigation. It is becoming common in many other business transactions as well such as mergers and acquisitions. Clearly, establishing a fair market value is critical whether one is a buyer or a seller.

The estimate of the business value of software-intensive property is based on the economic model described in Software as Capital – An Economic Perspective on Software Engineering, IEEE Computer Society Press, 1998, by Howard Baetjer. an Economics professor at Towson University in Maryland.

Methodology
Software business value is derived from the following factors:

Change in customer revenue
Change in customer cost
Number of potential customers
Additions to developers’ working capital – e.g., additions to organization’s skills

Development Cost
Not all of the factors apply in any given instance but all must be considered. Note that “customer” can be any user of the software product, not necessarily the actual purchaser. The valuation can only be an Estimate because it depends on an uncertain future.

Additionally, the following factors modify any estimate:

Subjective nature of value – value to whom?
Tolerance of capital to change – how efficiently can the knowledge asset be evolved in response to change in business environment?
Current market valuation environment – relative favor of this type of business as judged by capital markets

Refer to the following white paper for more information:
	Software Value Estimate – Description of economic model and methods used to estimate business value of software-intensive intellectual property (PDF, 46KB)
For a more information about determining the value of software, refer to the following article:
	Towards Estimating Software Value – Paper presented by Howard Baetjer to the Los Angeles Software Process Improvement Network, Center for Software Engineering, University of Southern California, 10/25/2000 (PDF, 475KB)

Computer Data Extraction and Analysis
Computer data which may be used as evidence requires special handling or the evidence may be found to be invalid or unreliable. Accordingly, the following rules are carefully followed in all computer handling and analysis:

Preserve one or more copies of disk contents using methods, which faithfully reproduce the original version of the entire contents of storage media -- used or not. This requires specially configured examination computers and software tools to avoid using the original computer system to provide access to evidentiary media. CCG uses specialized evidence capturing software, i.e., EnCase (see EnCase information), used to capture a valid evidentiary copy. Once obtained, this copy cannot be modified without detection.\

Maintain records (chain-of-control) and backup copies of original to allow recreation of all steps used in preparation of evidence.

Provide clear contextual and explanatory material in non-technical terms for all computer-based evidence. See the Exemplar Internet Activity Report

For a more complete description, refer to the following white paper:
	Computer Examination Methods - Description of methods used in examination of computer resident data which may be evidence (PDF, 16KB)
For examples of an actual document produced in support of litigation see the following:
	Exemplar Internet Analysis Report – Shows how complex data resident on evidentiary computer is prepared for submission to the court as understandable, objective evidence (PDF, 154KB)
For a more information about Encase software, refer to the following articles:
	EnCase Case Study – Article from IEEE Computer Society magazine (PDF, 264KB)
	Electronic Evidence Discovery – Article from Federal Discovery News (PDF, 21KB)
	EnCase Legal Journal - Discussions about computer evidence, forensic acquisition, and the legal challenges EnCase has withstood (PDF, 1.7MB)

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