In Exchange 2010, you can place a mailbox on retention hold or legal hold. Both holds serve a different purpose. It's important to understand the functionality provided by both.

Retention Hold: As the Messaging Records Management page in the EMC suggests (see Figure 1), retention hold is used to halt retention policy, which means the Managed Folder Assistant (MFA) does not move or delete items from the mailbox. It's typically used when a user may not have mailbox access for an extended duration, for example, when the user's on vacation. You can also use retention hold during the initial phase of MRM deployment and remove it as users become more comfortable with MRM functionality.

Should users access their mailbox when it’s on retention hold, they may notice that items aren’t being deleted or moved to archive. Mailbox size increases as more email accumulates and you may need to raise the user's mailbox quotas to ensure mail flow to and from the mailbox isn’t interrupted.

The mailbox owner or any user (or process) with mailbox access can delete messages when the mailbox is on retention hold. Deleted messages are not treated any differently when a mailbox is on retention hold. Deleted items are retained until the deleted item retention period (14 days by default) and then deleted permanently. See the Retention Hold section in Understanding Retention Tags and Retention Policies for more details.

When placing a mailbox on retention hold, you can specify a start date and an end date. This allows you to configure retention hold in advance, and have it end at a predetermined date. Takeaway: retention hold is for planned activity, suspends move or delete actions taken by the MFA. If you haven't deployed either MRM feature (Retention Tags or Managed Folders), retention hold is unnecessary.

Note: When you archive-enable a mailbox, the Default Archive and Retention Policy is automatically applied to the mailbox if it doesn't have a retention policy.

Litigation Hold: Litigation hold, also known as legal hold, is used to preserve mailbox items for discovery before and during legal proceedings, investigations or similar events. The goal is to preserve mailbox items from inadvertent or purposeful modification or deletion by the mailbox owner or any user with mailbox access, and also automated deletion by processes such as the MFA. Unlike retention hold, you can’t configure litigation hold to start and end at a specified date – it’s either enabled or not. Until the hold is removed, deleted items are not purged from the mailbox database. If mailbox items are modified, a copy of the original item is also retained. These are returned in Discovery searches performed when the mailbox is on litigation hold. See Understanding Litigation Hold for more details.

When you place a mailbox on litigation hold, Exchange also populates the LitigationHoldDate and the LitigationHoldOwner properties, which can be useful for tracking purposes. Note that an administrator can modify the LitigationHoldDate and LitigationHoldOwner properties. Admin audit logging is the best place if you're looking for reliable audit trail of admin actions.

Tip: You can run a litigation hold report from the Exchange Control Panel by going to Roles & Auditing > Auditing > Run a litigation hold report....

Read the complete blog at http://blogs.technet.com/b/exchange/archive/2011/08/16/retention-hold-and-litigation-hold-in-exchange-2010.aspx

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