In the age of Facebook, more and more litigants will document their life online and through social media. This opens up a plaintiff’s social media accounts, like Facebook, for discovery, especially if he or she makes an emotional distress claim. A recent decision by the United States District Court for the District of Vermont reinforces this principle by applying the liberal discovery rules to the changes and advances of social networking and online interactions.  

In Lewis v. Bellows Falls Congregation of Jehovah’s Witnesses, Bellows Falls, Vermont, Inc. et al., 2016 WL 589867 (D. Vt. Feb. 11, 2016), the Vermont federal district court granted broad discovery access to a plaintiff’s private Facebook account in a case involving claims of emotional distress and loss of enjoyment of life.  The district court’s decision in Lewis appears to be one of the first decisions in the state or federal courts of Vermont, if not the first, addressing this issue, but is consistent with the conclusion of numerous courts throughout the country that non-public content on a social networking site can be highly probative evidence of a plaintiff’s mental, emotional, and physical state.  

The issue in Lewis was whether a plaintiff could shield the non-public contents of her Facebook account from discovery in a case where she claimed to suffer emotional distress, embarrassment, loss of self-esteem, disgrace, humiliation, and loss of enjoyment of life arising out of allegations of sexual abuse.  The plaintiff claimed that by availing herself of Facebook’s privacy settings, she had an expectation of privacy that precluded discovery in civil litigation irrespective of her damages claims.  Defendant argued that by filing suit and claiming emotional distress and loss of enjoyment of life, the plaintiff had placed her mental and emotional state directly at issue and any information posted by plaintiff or a third-person to plaintiff’s online account concerning any emotion or feeling was material and relevant to the defense.  Defendant also argued that disclosure of the non-public contents of plaintiff’s Facebook account was not a violation of her right to privacy. Facebook, argued defendant, is like a diary of one’s life – but with a very important distinction:  unlike a diary, a Facebook user intends for other people to see their writings and postings.

Agreeing with defendant, the court concluded that there is no legitimate expectation of privacy with email and other internet transmissions including social networking.  Although the plaintiff had used privacy settings to limit viewings of her Facebook postings to certain “friends,” plaintiff had over 200 such “friends” and “had no justifiable expectation that [her “friends”] would keep her [Facebook posts] private.”  Lewis, 2016 WL 589867 at *2.  The court further recognized that the defendant’s need for access to the private Facebook information outweighed any privacy concerns, because Facebook information is “circumstantial evidence that offers a reasonable prospect of corroborating or undermining [plaintiff’s] claims.”  Id. (quoting Zakrzewska v. New School, 2008 WL 126594, *2-3 (S.D.N.Y. Jan. 7, 2008).  

Although the court stopped short of granting “unfettered access” to defendant, it nonetheless issued an order that plaintiff produce seven broad categories of non-public Facebook information.  Among the discoverable information is any post that “reveal[s], refer[s] or relate[s] to any emotion, feeling, or mental state” of plaintiff and all photographs and videos depicting the plaintiff or her activities.  Lewis, 2016 WL 589867 at *3.

In many lawsuits, what a plaintiff is doing on a day-to-day basis; what activities a plaintiff is engaging in; how a plaintiff is behaving; and a plaintiff’s emotional state, are all relevant to the claims they are making.  Facebook can reveal all of these things, and will do so with increasing frequency in litigation as the numbers of users continues to grow.  For example, a plaintiff might be asserting in the lawsuit that they are no longer capable of feeling joy, no longer enjoy the company of other people, and prefer to stay home.  Yet their Facebook postings, or their friends’ postings, show plaintiff socializing or even at a club, dancing.  Under the circumstances, it is entirely reasonable for defendant to assume that the “private” section of a plaintiff’s Facebook page will reveal even more information that contradicts the claims in the lawsuit.  The cases, like Lewis, show that the courts will order discovery of these “private” sections.      

Attorneys have been using social media and Facebook for years to obtain information.  Lewis and other recent cases highlight the ongoing significance of social networking discovery as a powerful tool to obtain an unmatched portrayal of a plaintiff’s everyday life.  

Jennifer McDonald is an associate in the Litigation Group at DRM, Vermont’s largest law firm, and represents the Defendant in the Lewis case cited above.


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This is a relatively new legal subject, so there isn’t much law out there.  In December, 2011, a Pennsylvania federal court answered this question in the negative.  In the case of Eagle v. Morgan, Linda Eagle, the founder of a company, Edcomm, had developed a significant LinkedIn presence closely connected to Edcomm. In 2010, Edcomm was purchased.  In 2011, she was terminated and Edcomm took over her LinkedIn account. She sued Edcomm.  Shortly thereafter, she regained control of her LinkedIn account and refused to return it to Edcomm. Edcomm counterclaimed against her in her lawsuit, contending that by regaining control of the LinkedIn account and refusing to return it to Edcomm, she had misappropriated Edcomm’s trade secrets.  She moved to dismiss Edcomm’s misappropriation claim. With little analysis, the court dismissed the claim, stating that the LinkedIn contacts on the Eagle/Edcomm account were “generally known . . . or capable of being easily derived from public information.”

In March, 2012, a Colorado federal court came to a different conclusion. In Christou, et al. v. Beatport, LLC, a nightclub company sued an ex-employee for stealing the company’s MySpace “friends” list.  The ex-employee moved to dismiss the lawsuit, arguing that a MySpace “friends” list couldn’t be a trade secret.  The court denied the ex-employee’s motion, holding that a company’s MySpace profiles and friends list can be a trade secret because, online, a MySpace profile contains a lot more information than just the “friend’s” name.  It gives the owner of the profile the “friend’s” personal information, including interests, preferences, and contact information that can have commercial value. It allows the “friend” to be contacted and advertised to.  This information goes beyond what is publically available. Duplicating all the information available from the “friends” list would be time-consuming and costly. The public can see the names of the company’s “friends” online, but the public does not have all the other information that the company gets by virtue of having these “friends.”  

In September, 2014, another federal court held that LinkedIn contacts could be a trade secret.  In Cellular Accessories For Less, Inc. v. Trinitas, LLC, a company sued an ex-employee who had left to form a competing company and taken his LinkedIn contacts with him. The ex-employee moved for dismissal of the lawsuit.  The court denied his motion, holding that the LinkedIn contacts that he had developed while working for his former company could be the company’s trade secret. The company had encouraged the employee to develop LinkedIn contacts during the employment.  The court said that the LinkedIn contacts may – or may not – have been viewable by other LinkedIn users; the ex-employee’s motion papers did not say whether the contacts were publically viewable.  Since they may not have been publicly viewable, they could be the company’s trade secrets.  

There you have it. What do you think?


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In his recent article in City-Journal, Northwestern University Law Professor John McGinnis hypothesizes that recent and impressive technological advances will have an increasingly disruptive impact on the legal profession.  McGinnis notes that “law schools are in crisis,” “solo practitioners have been hurting for a decade,” “attorney job growth has been flat,” and “the going rate for associates, even at the best firms, has stagnated since 2007.”  Though the economic downturn has certainly played a part in the current state of the legal industry, the advances in information technology will be the determining factor in the future.  McGinnis predicts that “five key areas of law now face encroachment by this machine intelligence.”  

The first, e-discovery, is already well on its way to changing (and limiting) opportunities for some lawyers.  Most notably, junior litigation associates used to be profit centers for big firms by spending late nights and weekends on hefty document review projects.  With predictive coding, the speed and accuracy of this work is improved and the need for bodies in the office is decreasing.  

The second key area is legal research, which as McGinnis notes, has largely “depended on typing in the right specific keywords.”  As computer technology improves, machine intelligence will be able to recognize concepts rather than just words with the result being more efficient research limiting lawyers’ “traditionally enjoyed leverage over the laity.”

McGinnis’ third area, legal forms, is already replacing many of the tasks traditionally performed by solo practitioners and small firms: trusts, estates, basic corporate documents, etc.  Businesses like Legal Zoom and Kiiac specialize in drafting estate documents and contracts, while “Nevada’s secretary of state has pioneered online registration for small businesses, which can comply with regulations by following the steps of simple computer programs.”  

McGinnis also predicts computers may one-day play a stronger role in a fourth traditional lawyer task: drafting briefs and memos in simple litigation.  Though McGinnis notes “an experienced lawyer could easily shape a computer generated draft into a more polished product” there’s no denying that “once programs start being useful, they get more effective over time.”  Ultimately, computers may be playing the role of entry-level associate in some cases.  

Finally, McGinnis hypothesizes that computers will bring “moneyball” to law.  The term “moneyball”, made famous by Michael Lewis’ bestselling book about the change in baseball statistics and analytics, generally refers to a method of predicting results based on raw data and statistics.  For lawyers, the use of “moneyball” in the law means that computers predict a client’s chance of success in litigation, as opposed to a lawyer’s hunch or gut feeling. To some extent, legal moneyball is already in place.  Legal support companies already track numerous statistics about potential jurors and past jury verdicts in forums across the country. The question is, how much progress can be made using legal moneyball?

Right or wrong, McGinnis raises some interesting points about the changing role of computers and technology in the law.  In a world where lawyers are constantly competing with each other for the next case and the next deal, perhaps the most successful lawyers will be those that are prepared to compete with and for the best legal technology.  Indeed, as MIT’s Eric Brynjolfsson and Andrew McAfee have advised in their recent book Race Against the Machine, “The key to winning the race is not to compete against machines, but to compete with machines.”

You can read the entirety of McGinnis’ article here. 

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An administrative law judge (“ALJ”) writing on behalf of the National Labor Relations Board (“NLRB”) reviewed the social media/on line communications policy of The Kroger Co. of Michigan, a retail grocery chain, in the context of an unfair labor practices complaint.  In the decision issued on April 22, 2014, the ALJ ruled that portions of Kroger’s policy were unlawfully broad and in violation of Section 7 of the National Labor Relations Act.

 What was the offending language?

If you identify yourself as an associate of the Company and publish any work-related information online, you must use this disclaimer: “The postings on this site are my own and do not necessarily represent the postings, strategies or opinions of The Kroger Co. family of stores.”

It is fairly common for employers to establish policies requiring that employees use disclaimers of this nature when posting on line.  The ALJ, however, stated that “there is no question but that this rule implicates much Section 7 activitiy.  While not all work-related information is potentially protected by Section 7, a great deal of it is.”

The ALJ conceded that an employer has a legitimate interest in stopping unauthorized employees from speaking on behalf of the company and even from being perceived as speaking on behalf of the company.  He determined that in evaluating the employer policy, it was necessary to consider what the risk is that, in the absence of a disclaimer, section 7 activity, i.e. discussing the terms and conditions of employment, would be mistaken for employer sanctioned speech.  The ALJ concluded that a disclaimer is problematic under the Act if it is likely to chill legitimate and protected employee speech.

In striking down the disclaimer language the ALJ stated that “Given the breadth of online communications to which the rule applies, it would be extremely burdensome to have to post the disclaimer in each instance or on each new page, and this would have a reasonable tendency to chill Section 7 activity in this regard.”  The Decision itself is worth the read in that it gives startling insight into the reasoning of at least this one ALJ.

This blog was originally posted on May 10 on the Employment Law Business Guide. Click here to read the original entry.  

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LinkedIn has been recognized by numerous sources as a useful tool for marketing and networking within the legal community.  The social networking site has nevertheless recently raised the concerns of a number of state bar associations, including Florida and New York.  LinkedIn counsel recently met with Florida Bar Association officials to address the Florida bar’s concerns regarding the social networking site’s use of descriptors such as professional "specialties" and third party recommendations.  While Florida may have among the most stringent advertising rules in the country, the Florida bar’s expressed concerns  have echoed questions across the country pertaining to the regulation of attorney advertising generally, the need to prohibit false or misleading claims about attorneys or the services they render, and how those rules operate in a world of social media.  State bar associations across the United States are making every attempt to keep up with the constantly evolving social media age and the fundamental changes respecting the methods by which how attorneys may advertise.  With such attempts, the state bars are seeking a balance between protecting their lawyer members and the lawyers’ potential clients.   But some argue such protection is overbroad, and imposed at the cost of an attorney’s first amendment rights.  Indeed, one Florida law firm has filed a federal lawsuit against the Florida State Bar alleging violations of the firm’s First Amendment rights.  

Some attorneys may not fully appreciate the ethical limitations imposed on attorney advertising, as some aspects of social media may require closer examination regardless of where you practice.  For example, do “professional specialties” mean an attorney is board certified by a particular state? Could it be perceived that way by a potential client? When does a third party recommendation equate to an unethical endorsement of an attorney’s skills?  Even a cursory consideration of these questions shows why LinkedIn might be willing to discuss the concerns of state bar associations and to work with those state bars  to ensure appropriate mechanisms are in place which would allow attorneys to have informational content in their profile useful to advertise their practice, but at the same time do so in compliance with the ethical rules of their state, while also allowing them to monitor and revise that content..  As attorneys continue to use and expand their use of social media, it is important to remember the standard advertising rules apply, even though the media may be ever changing. 
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In today’s connected society, it’s difficult to escape the necessity of joining the world of social media networking. For attorneys, social media may provide fast, easy, and economical means of reaching clients and potential clients and advertising their services. “Victory in court today! Contact me for a free consultation,” and “Just won a million dollar verdict! Tell your friends to check me out,” are examples of common social media postings utilized by attorneys to spread the word of their success and appeal to clients. But are such postings subject to the Rules of Professional Conduct regarding advertising? This was the issue recently decided by The State Bar of California Standing Committee on Professional Responsibility and Conduct.

The Rules of Professional Conduct and the Business and Professions Code place numerous requirements and restrictions on attorney advertisements and communications. Rule 1-400 of the Rules of Professional Conduct entitled “Advertising and Solicitation” provides detailed requirements with which attorney advertising must comply. However, despite its title, it speaks in terms of “communications” rather than specifically “advertisements.”  The rule defines a “communication” as “any message or offer made…for professional employment…directed to any former, present, or prospective client.”  Furthermore, the Business and Professions Code defines an advertisement as any “communication…that solicits employment of legal services.” Therefore, when it comes to social media postings, because such postings are technically communications, they must be carefully analyzed to ensure that the rules are complied with. Despite the fact that these rules do not specifically refer to Facebook or Twitter postings, “there is little doubt that the restrictions [of the rules] indeed apply to computer-based communications.” (The State Bar of California Standing Committee on Professional Responsibility and Conduct, Formal Opinion no. 2012-186.) In light of the foregoing, it was determined by the Standing Committee that the real issue when determining whether a Facebook or Twitter posting constitutes a communication within the meaning of the rules is whether the statement “concern[s] the availability of professional employment” of an attorney. (Rule 1-400(A).)

For example, a Facebook posting stating, “Case finally won! Celebrating tonight,” does not seek employment by the attorney. Whatever the attorney’s subjective intent when making the statement, it does not constitute a communication for purposes of the rules. In contrast, the statement “Victory in court today! My client is delighted. Contact me for a free consultation,” suggests the availability of professional employment and is therefore subject to the rules. This statement furthermore violates Rule 1-400(E), Standard 2 by containing a client testimonial (“[m]y client is delighted!”) without an express disclaimer.

Any social media posting that seeks professional employment and is therefore subject to the rules must comply with the advertising requirements that apply to such communications. Rule 1-400, Standard 5 requires that the communication bears the word “advertisement” or “newsletter”, or other words to that effect. Additionally, any such communication must be retained by the attorney for two years; this rule has been specifically extended to include “electronic media” by Rule 1-400(F). 

While the social media outlets may provide personalized, informal contact with friends and business contacts, it should be remembered by all attorneys that the informal arena does not relieve the attorney of his or her ethical obligations. So, before you press “send” on your tweet, don’t forget to check your statements to ensure they are in compliance with the Rules of Professional Conduct.

*This was originally posted on May 7 on Jampol Zimet LLP’s Insurance Defense Blog. Read the original post here

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Authority without accountability is dangerous. Accountability without authority is agonizing. Such agony is manifest in two ediscovery sanction awards making the rounds recently. Peerless has commentators warning us not to pass to the buck to our ediscovery vendor. While Branhaven has raised questions of how much outside counsel can rely on their client when certifying discovery responses (in addition to reaching questionable conclusions re PDF vs. TIFF productions).

The commentary on both cases has been excellent. Much it has focused, understandably, on the division of responsibility – who is accountable for what. Outside counsel, it seems, can trust only themselves – not the vendor (Peerless); not their own client (Branhaven). Nor, of course, can anyone rely on custodians to comply with hold instructions (as we learned in Samsung), let alone self-collect

In holding the parties accountable both rulings suggest some implicit assumptions about authority that are worth exploring. Specifically, Branhaven assumes that outside counsel will, if she chooses, have visibility into a client’s efforts to assemble documents; while Peerless assumes that a domestic party can supervise document collection efforts at a foreign affiliate. 

In Branhaven, outside counsel appears to have little idea as to what his client, Branhaven, was actually doing. Counsel forwarded requests for production to Branhaven. Counsel then certified written responses to requests representing that responsive documents would be produced. Counsel based his certification on his “understanding” that Branhaven was assembling the responsive documents. But, as the District Court in Maryland found and sanctioned, Branhaven’s effort in identifying and assembling responsive documents was lacking. In what appears to be a first, the court also sanctioned outside counsel for failure to make a “reasonable inquiry” into his client’s process and progress—or lack thereof, as it turned out.

I don’t know enough about the specific facts underlying Branhaven to pass judgment on counsel’s behavior. But I do feel a general sympathy for outside counsel whose queries are met with “we’re handling it”—whatever “it” happens to be. Further inquiry may be required as a matter of professional necessity. But pressing in-house counsel for additional information is risky from the perspective of positional power and relationship maintenance. 

Many in-house counsel are under enormous pressure to keep costs down and are therefore inclined to do as much work themselves as they can manage. Discussions with outside counsel about that work are just another cost to be avoided. Further, many in-house counsel are offended at the thought of outside counsel questioning their work, judgment, process, etc. because….well, because being the boss can go to one’s head (sorry if I am shocking anyone’s delicate sensibilities here). Finally, regardless of the motivation, what can outside counsel really do if in-house counsel is not inclined to share? There are options, few of them good – e.g., quit, send CYA memos.

A similar dynamic exists between affiliated entities. In Peerless, the vendor on whom too much reliance was placed was responsible for collecting documents from defendant’s non-party, Chinese affiliate. The Northern District of Illinois sanctioned the defendant, Crimson for having an insufficient basis to support its assertion that all responsive documents in the possession of its non-party, Chinese affiliate, Sycamore, had been produced.

The Peerless court had previously ruled that defendant Crimson was able to obtain documents from Sycamore and must therefore do so. Crimson subsequently produced documents provided by Sycamore via a vendor. In conjunction with the production, Crimson represented that all responsive documents had been turned over. The court, however, was unimpressed with Crimson’s “hands-off approach” to managing discovery at Sycamore. Rather than passive recipients of their foreign affiliate’s documents, the court found that Sycamore had a duty to directly “contact individuals at Sycamore and play a role in obtaining discovery.”

Again, I don’t pretend to know the particulars of Peerless. But I possess considerable sympathy for a domestic entity that is responsible for collecting documents from a foreign affiliate. Affiliates do not always play nice with each other. A request for assistance can run into (a) company politics, sibling rivalries, internecine conflicts, etc., (b) a genuine sense of we work at different companies, don’t tell me what to do, (c) busy people who have no time or incentive to worry about your problem, (d) a colorable conclusion that this ediscovery stuff is a bit daft; or (e) all of the above. 

The challenges are only more daunting when the affiliate is in a different country where geographic distance, language barriers, cultural differences, and variations in IT infrastructure are only the most obvious obstacles. These dynamics can become particularly untenable when the requesting entity is a small subsidiary of a large, foreign parent from whom the documents are needed. What is a domestic, in-house attorney supposed to do when a VIP at the mothership proves unresponsive to pleas for assistance? There are options; few of them good – e.g., CYA memos; try to go above the VIP.

I am not suggesting that either case was wrongly decided. Courts also face authority constraints. Their power is often limited to those who appear before them – i.e., lawyers and the parties they represent. It is unsurprising who was held accountable in Branhaven and Peerless. But it is still unsettling. Those of us who remain unconvinced of our own omnipotence can easily imagine ourselves in either position regardless of our experience, effort, acuity, etc. 

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Trade secrets are aspects of your company that, if discovered/used by a competitor, could significantly impact your bottom line or your ability to compete in the marketplace.  Recently, a federal court in Colorado held that even something that appears to be publicly known – in this case, a business’s Myspace® profiles and “friends” lists – can be trade secrets.  It is, so far, the only court known to do so.

In this post, I will explore the trade secrets misappropriation claims related to the plaintiff’s social networks within a larger antitrust and unfair competition case.

Plaintiff Regas Christou owns several trendy nightclubs in Denver. Each club has an online presence, including a Myspace site. Defendant Bradley Roulier is a former employee of Christou.  One of Roulier’s responsibilities as an employee of Christou was to develop the social networking profiles for Christou’s clubs.

In 2003, while still employed by Christou, Roulier founded Beatport, an online marketplace for downloading electronic dance music. Christou lent Roulier money to establish Beatport, and promoted and advertised for Beatport on his nightclub websites.  By 2005 Beatport was a commercial success as theonline source for electronic dance music.  Roulier entered into negotiations to buy one of Christou’s clubs, but instead, while the negotiations were ongoing, opened his own competing club, Beta, in 2008. Christou, on behalf of himself and his nightclubs, alleges in his lawsuit that Roulier used his ability to control DJs, through Beatport, to coerce them to play only at Beta and not at any of Christou’s clubs.  Christou’s lawsuit makes numerous antitrust and unfair competition claims against Roulier, Beatport and Beta, in addition to the trade secrets misappropriation claim.  The defendants made a motion to dismiss all of Christou’s, et al.’s, claims.

How Can a Public List Be Considered a Trade Secret?
According to Christou, et al., Roulier and the other defendants misappropriated plaintiffs’ log-in information for the clubs’ profiles on Myspace; lists of plaintiffs’ Myspace “friends”; lists of cell phone numbers and email addresses for DJs, agents, and promoters; and customer lists.  In analyzing whether to dismiss plaintiffs’ claims, the court looked to the eight factors used by many courts to determine whether trade secrets exist.

Roulier, et al., argued that a list of Myspace “friends” cannot, by definition, be a trade secret because it is broadcast to the world.  But the court noted that Christou, et al., had limited the access to the Myspace profiles, via passwords, to prevent access by anyone other than those personnel requiring access.  (Related post: How Much Secrecy is “Required” to Protect Trade Secrets?)  The court noted that social networking “friends” are more than simple lists of potential customers.

When a user of a social network “friends” a business, such as one of Christou’s nightclubs, that user allows the business access to the user’s personal information, including interests, preferences, contact information, and a built-in means of contact.  Like a customer list, the friends are a database of contact information for people (customers) who are already confirmed to be interested in one or more businesses (Christou, et al.’s nightclubs).

The court determined that the trade secret is not merely the friends’ names, but also their email addresses, their permission to be contacted, and the ability to notify them and promote directly to them via their Myspace accounts.  This information, according to the court, simply cannot be compiled from publicly-available sources.  The court found that Christou, et al., expended at least some effort and cost to develop the social networking aspect of its business (operating nightclubs) and the list of friends.

Lastly, the court considered whether Roulier, et al., could easily duplicate the list of friends.  The court found that any effort to duplicate Christou, et al.’s friends list would be theoretically possible, but time-consuming and costly, as it would require Roulier, et al., to individually contact each of the thousands of friends and ask for permission to “friend” them.

In sum, the court concluded that a business’s online lists of friends can be a trade secret.  Since this decision came in the context of the defendants’ motion to dismiss the claim before trial, the court did not conclude that Christou, et al., had proven that the friends list is a trade secret, but only that Roulier, et al., had not proven that the list could not be a trade secret.  Thus, the court allowed the claim to proceed.

What do you think – should a company’s social media “friends” list be considered a trade secret?

*This post can be found here on "The IP Blog," originally posted on August 1, 2012 by Walter E. Judge, Jr.*   

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Insurance Coverage and Cyber Crimes

Posted on September 13, 2012 07:56 by Brenda K. Wallrichs

A recent report indicated there have been almost 200 high profile data breaches this year, resulting in the exposure of over 13 million records.  Among the information released was social security numbers, bank account numbers, patient and medical information, and other personal data.  In addition to these large scale breaches, breaches on a smaller scale occur daily, from employees accessing and misusing electronic information stored by their employers to students utilizing Facebook posts to bully.  These breaches clearly raise privacy concerns and cause headaches and in some cases heartache for the individuals whose information was disseminated.  But the breaches also create serious liabilities for the entities that were entrusted to secure the information and for the persons who accessed it.

An emerging and evolving issue concerning data breaches and other cyber crimes is the availability of insurance coverage for the persons bearing responsibility for the release and improper use of the information.  Courts struggle with applying traditional CGL policies to cyber losses, and insurers are responding with a variety of new products. The availability of coverage, both under traditional policies and under more recently developed policies, is a topic that will be discussed at the DRI Insurance Law Committee’s Insurance Coverage and Practice Symposium.  Please join us in New York City, December 6-7, for more discussion about this topic.

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Ethics 20/20: The Impact of Technology

Posted on August 30, 2012 03:19 by J. Logan Murphy

Every day, we see the impact of technology on the practice of law. Blogs, social networking, electronically stored information, and other legal resources create enormous economies and unprecedented depth in our field. But with these advantages come unrecognized perils. The transparency and mobility of electronic information creates significant risks to clients, unless properly controlled. As part of the project to rein in technology in the practice of law, the American Bar Association launched an ambitious multi-year project called Ethics 20/20. One of the major goals of Ethics 20/20 was to modernize the rules of ethics and bring them into congruence with the state of technology.

At its most recent meeting, the ABA passed multiple resolutions amending the Model Rules of Professional Responsibility to reflect the evolution of technology in the practice of law. This article provides a brief overview of those amendments. Those who are more interested in the details of the amendments can click here to read the reports online.

Confidentiality When Using Computers
Resolution 105A makes changes to help lawyers understand how to protect client confidences when using new technology, including cloud computing, tablets, and smartphones. Though small, one of the most significant changes is included in Comment 6 to Rule 1.1 (Competence). The Rule now includes a requirement that “a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology.” No longer can attorneys simply ignore developments in favor of staid methods of practice. To be competent, an attorney must work effectively with technology and keep alert to technological improvements and changes.

The amendment to Rule 1.6 (Confidentiality of Information) is probably the largest and most impactful rule change related to confidentiality. Now, Rule 1.6(c) requires attorneys to “make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating the representation of a client.” The comments make it clear that attorneys are required to utilize reasonable safeguards to protect confidential information. These changes are geared toward the protection of electronic data, especially given the innumerable bits of sensitive information flying around every day.

Using Technology for Marketing
Resolution 105B was designed to help lawyers understand how the principles of attorney advertising already incorporated into the Rules are affected by the growth of Internet-based marketing and social networking. This particular resolution accomplishes three main goals. First, changes to Rule 1.18 offer guidance on how to market online without inadvertently forming an attorney-client relationship. Recent cases have demonstrated confusion on behalf of the general public regarding whether an attorney-client relationship is formed when the potential client emails the attorney or fills out a communication form on the attorney’s website. The amendments to Comment 2 of Rule 1.18 address the concern by stating that a person becomes a prospective client by “consulting” with a lawyer. While the existence of a consultation depends on the circumstances, the Comment eliminates potential passive liability to prospective clients. A consultation “does not occur if a person provides information to a lawyer in response to advertising that merely describes the lawyer’s education, experience, areas of practice, and contact information, or provides legal information of general interest.” But, if the lawyer actively invites information about a possible representation, the lawyer is probably stuck with a prospective client.

Second, the Rules contain a prohibition against paying others for a “recommendation,” and this Resolution modifies that prohibition to account for online lead generation services through chances to Comment 5 of Rule 7.2. Lawyers may now pay others for generating client leads, as long as the Internet-based lead generator does not “recommend” the lawyer. The lawyer is also responsible for the representations of the lead generator, with Comment 5 placing the onus on attorneys to ensure that the lead generator is not making statements that are inconsistent with the rules.

Finally, amendments to Rule 7.3 assist attorneys in determining when communications on the Internet, particularly through social networking sites, may constitute a “solicitation.” Only a “target communication initiated by the lawyer” directed to a “specific person” that “offers to provide” legal services is a solicitation. Communications to the general public, including Internet banners, are not solicitations, so feel free to jump on that Facebook advertising spot.

Outsourcing
Lawyers have been slow to adopt the economies of scale that outsourcing can provide, in part because of the perceived ethical dilemmas presented in outsourcing. Outsourcing can endanger confidential client information and presents a quandary over legal work being performed by attorneys not licensed in the United States. Resolution 105C encourages attorneys to ensure the efficiency, competence, and ethics of any outsourcing process. An entirely new comment is added to Rule 1.1, requiring the informed consent of the client to contract with any lawyer outside of the lawyer’s own firm. And, lest we forget, lawyers are always charged with supervising non-lawyers; that requirement does not abate simply because work is being outsourced to a foreign country. Comments 1 and 3 to Rule 5.3 incorporate this concept and apply the general rule to all non-lawyers outside of the lawyer’s own firm. The basic gist of the changes in Rule 105C is to encourage lawyers to keep a sharp eye on professionals hired from outside their own firm, and to work closely with clients in determining the proper scope of outside contracting and supervision. No surprise there—constant communication with the client is a harbinger of a durable and responsible attorney-client relationship.

Mobile Lawyers
A prevalent by-product of an informationally small, but geographically large, practice is the tendency of lawyers to move their practice. The world does indeed get smaller every year. No longer do lawyers move down the street; more and more, attorneys are moving their practice to different jurisdictions, and virtual law offices are sprouting in all states. The remaining resolutions that passed enable attorneys to establish a practice in another jurisdiction—subject to stringent information protection requirements—while pursuing admission in that jurisdiction. Resolutions 105D and 105E address the ABA Model Rule of Practice Pending Admission and the ABA Model Rule on Admission by Motion, respectively. With a few states signaling their intent to adopt a uniform bar exam, these model rules and their amendments continue the progress toward a more uniform practice of law. In case you have never encountered these model rules, or their state versions, their purpose is to allow experienced lawyers who have moved into a different jurisdiction to continue to practice while awaiting an expedited admission to the Bar. 

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