Legal Hold

In its simplest form, Legal Hold or Litigation Hold describes the concept of issuing official notification to "custodians" instructing them to not destroy or otherwise modify any document they might have that pertain to the matter in scope.
With the advent of electronic communications and electronic record keeping, Legal Holds have changed from a "do not shred" order to a do not delete order. Indeed Legal Hold is now understood to primarily apply to Electronically Stored Information (ESI). 
Legal Hold is a critical piece of the eDiscovery flow and a flawed Legal Hold process can, in some circumstances and in some jurisdictions, lead to sanctions or case to be rejected altogether.
The process of Legal hold is fairly simple:
- identify parties that might have in their "control" ESI relevant to the case - these are often knows as Custodians (for example business people who are normally responsible for that information)
- identify the scope of data to be put under legal hold: a specific matter or business project (the Barista pipeline project) or any specific activity (the Hiring of John S.), appropriate dates
- issue them an official notification, ordering custodians to not modify or delete any documents (ESI or not) relevant to the scope of the Legal Hold
- receive notifications
- review Legal hold: the scope might increase or on the other hand, the matter might close and the Hold will decease
There are however additional aspects to consider:
- Legal hold and systems-based records management policies.
In an effort to keep the volume of ESI under control, many systems will automatically archive and then delete emails for example. Legal departments should be aware of such policies and ensure Legal Holds can also be sent to "systems custodians" who should alter the deletion policies for the scope of the legal hold. 
- a fluid employee landscape:
what is company is sued with regards to a business deal but all the "custodians" have left the company? Who is then responsible for ensuring safe custody of the information? In response to these concerns, most Legal hold systems are able to either track the "history" of custodians or integrate with Corporate HR systems. 
- Managing Legal Holds:
Sending the initial notification might be relatively straight forward. However, tracking responses, updating custodians, modify scope etc can become very difficult, especially for large matters involving custodians in multiple offices or countries. Managing a set of legal hold in a way that is defensible can often become a "project management" exercise and if the company is a serial litigatant or under intense regulatory scrutiny, will need a dedicated Holds Management system. 
Further reading & useful links:
The GCOC (Compliance, Governance and Oversight Council) website has great resources and information:
The CGOC aims at providing a framework for all aspects described above, not just the E-discovery portion.
The Electronic Discovery Reference Model (EDRM) website has a wealth of content for the E-discovery specific aspects of Litigation management: