Unprecedented Fraud and Large Fines Highlight Compliance Requirements for Unified Communications

BELMONT, CA--(Marketwire - March 6, 2008) - FaceTime Communications, the leading provider of solutions that secure Web and unified communications (UC) in the enterprise, has seen growing concern among large organizations over the past several weeks, examining their ability to log, archive and retrieve instant messages.

The recent concern is fueled in part by news reports related to $7.1 billion in losses caused by a rogue trader at Société Générale, a large French bank. Earlier this month, instant messages reportedly exposed a new twist in the scandal surrounding the record losses. Other cases also have brought e-discovery to the news forefront in recent months, including a patent infringement trial involving Qualcomm Inc. and Broadcom Corp. that resulted in fines to Qualcomm in excess of $9 million due to its untimely response to e-discovery requests.

Among the changes to the Federal Rules of Civil Procedure which took effect December 1, 2006, is a broad new definition of what constitutes discoverable electronically stored information. Companies need to keep track of all the e-mails, instant messages and other electronic documents they store -- whether or not they define them as business records -- and, if involved in litigation, be able to produce their "electronically stored information" according to specific requirements as part of the litigation discovery process. Put in simple terms, if the communication is saved electronically it is subject to the e-discovery rules.

Most companies have implemented solutions to archive and monitor their e-mail systems, but fewer companies have established archiving systems for instant messaging, Web conferencing and other real-time communications used by office workers.

The problem is widespread. Only 68 percent of IT managers are at work locations where there are specific guidelines and policies that govern the archiving and storage of instant messages, e-mail and chat communications, according to the survey Greynets in the Enterprise: Third Annual Survey of Greynet Trends, Attitudes and Impacts, conducted by NewDiligence Market Research and commissioned by FaceTime. Further, 45 percent of IT managers would be unable to produce a record of a specific employee's instant message communications if required to do so for legal purposes, and just 55 percent of IT managers surveyed have received guidance from their corporate counsel concerning the archiving and storage of e-mails, instant messages, chats and other employee communications. For more information on the Greynets Survey, visit: http://www.facetime.com/solutions/greynets.aspx.

"Though the law does not grant an expectation of privacy to an employee communicating over a work PC or network, most employees still assume that their IM conversations are private and unmonitored," said Frank Cabri, vice president of marketing and product management for FaceTime Communications. "At this point in time, it appears that they are largely correct. However, recent cases emphasize the importance of monitoring and archiving electronic communications and their ramifications on businesses when not implemented."

With the rapid rise of real-time communications channels like instant messaging, IT managers are faced with decisions about what to block and what to allow. According to the Greynets Survey, 45 percent of IT managers are at work locations where enterprise instant messaging or unified communications are deployed. Even at these locations, 74 percent report that public instant message networks are also used by employees. Put another way, employees at up to one-third of work locations use both enterprise and public instant messaging.

Société Générale Instant Messages Archived and Retrieved

In the case surrounding Société Générale, the international press reported that the review of thousands of pages of instant message conversations revealed that the rogue trader may not have acted alone, and alleviated concerns that bank managers had knowledge of the trader's activities. Press reports noted that much of the trading scheme was discussed over instant messaging, as opposed to more traditional e-mail channels.

Société Générale's ability to retrieve these instant messages provided a clear trail for investigators. This is not surprising, as the financial sector has long led the way in policy and technology to ensure compliance of electronically transmitted and stored information.

Qualcomm Fined for Not Producing ESI

Perhaps the most visible recent case involving e-discovery was last year's patent infringement suit between Qualcomm and Broadcom. According to news reports, Broadcom sought electronic documents that would prove Qualcomm's early involvement in an industry trade group, which would mitigate its right to file for patent infringement.

As described in the March 1, 2008, issue of Corporate Counsel Magazine, important electronically stored information of Qualcomm was not discovered until the time of trial and by the time it was produced, it was too late. The article reports judge Rudi Brewster of San Diego ordered the company to pay Broadcom's legal fees and costs in the amount of $9.26 million, ruled that the two Qualcomm patents were unenforceable and referred the matter for possible disciplinary procedures.

FaceTime's IMAuditor Insures Management, Security and Compliance

IMAuditor™ is the leading enterprise-class solution for the security, compliance management and control of instant messaging and other real-time communication applications. The growing use of both public and enterprise instant message applications in the enterprise is posing both inbound and outbound security threats that can result in security breaches, productivity loss and information leakage.

IMAuditor supports all public and enterprise instant messaging clients, including Microsoft Office Communications Server and IBM Lotus Sametime, as well as industry-focused instant message communities such as Reuters and Bloomberg, and Web conferencing applications such as WebEx. Deployed behind the firewall, it provides a single enterprise-wide instant message management solution that gives IT visibility into and control over all real-time communications through a single interface.

About FaceTime Communications

FaceTime Communications enables the safe and productive use of instant messaging, Web usage and Unified Communications platforms. Ranked number one by IDC for four consecutive years, FaceTime's award-winning solutions are used by more than 900 customers -- including nine of the 10 largest U.S. banks -- for security, management and compliance of real-time communications. FaceTime supports or has strategic partnerships with all leading public and enterprise IM network providers, including AOL, Google, Microsoft, Yahoo!, Skype, IBM, Reuters and Jabber.

FaceTime is headquartered in Belmont, Calif. For more information visit http://www.facetime.com or call 888-349-FACE.

FaceTime, FaceTime Communications, IMAuditor, RTGuardian, GEM, Facetime Enterprise Edition, FaceTime Security Labs, IMPact Index, SpywareGuide.com and the FaceTime logo are registered trademarks and trademarks of FaceTime Communications, Inc. Other trademarks and registered trademarks are the property of their respective owners.

Contact Information: FaceTime Contact: Emily Chamberlin A&R Edelman 650-762-2945