Legal Ethics and Technology: What You Need to Know to be Technologically Competent. Model Rule 1.1. Diffusion of Innovation 10/11/2016

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1 Legal Ethics and Technology: What You Need to Know to be Technologically Competent Michael Downey Downey Law Group LLC October 2016 Model Rule 1.1 A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation. Comment: Maintaining Competence [8] To maintain the requisite knowledge and skill, a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology, engage in continuing study and education and comply with all continuing legal education requirements to which the lawyer is subject. 2 Diffusion of Innovation 3 1

2 Rules That Matter Rules to duties owed to clients, even inadvertent ones Rule duty of confidentiality Rules and concurrent and former clients Rule prospective clients Rule Destroying or concealing evidence Rule Extrajudicial comments Rule Candor to third parties Rule Dealing with inadvertent productions of privileged material Rule Unauthorized and multijurisdictional practice Rules to "advertising" rules Rule no false or misleading communications about a lawyer or lawyer's services Rule regulation of advertisements Rule regulation of targeted communications Rule limit on "specialist" advertising Rule no fraud, deceit, or misrepresentation 4 Technology and Ethics 1. Client Marketing 2. Client Information (Confidentiality) 3. Client Information (Preservation) 4. Third Party Information (Discovery) 5. Firm Operations Supervision and (virtual) practice Payment systems 6. Professionalism Concerns 5 Client Marketing Advertising and Solicitation 2

3 Early Regulation of Advertising Arizona Disciplinary Rule DR 2 101(B): "A lawyer shall not publicize himself.... or any other lawyer affiliated with him or his firm, as a lawyer through newspaper or magazine advertisements, radio or television announcements, display advertisements in... telephone directories or other means of commercial publicity, nor shall he authorize or permit others to do so in his behalf." 7 Bates Opened Door for Lawyer Advertising Lawyer advertising is constitutionally protected It cannot be completely banned But may be subject to reasonable restrictions regarding "time, place, and manner" 8 Post Bates First Amendment Decisions Ohralik v. Ohio State Bar Ass'n, 436 U.S. 447 (1978), permitted a state to ban in person solicitation of personal injury and wrongful death cases Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985), held a state could not ban advertisements for specific types of claims Shapero v. Kentucky Bar Ass'n, 486 U.S. 466 (1988), rejected a complete ban on targeted solicitation letters Peel v. Attorney Registration & Discipline Committee of Illinois, 496 U.S. 91 (1990), allowed a lawyer to truthfully state he is a member of National Board of Trial Advocacy Florida Bar v. Went for It, Inc., 515 U.S. 618 (1995), allowed state to impose 30 day blackout period before lawyers could solicit disaster or accident victims 9 3

4 Summary of Constitutional Limitations Constitutional Protection for Communication Invasiveness of Communication Shapero directed letter Direct, real time solicitation Advertisement 10 Ethics Rules for Advertising and Business Development Rule (All Communications) False and misleading communications including private communications and advertising about a lawyer or the lawyer's services are prohibited. Rule (Advertisements) Establishes additional restrictions for lawyer print, radio, and television advertisements, and prohibits the payment of referral fees to non lawyers for referring work to a lawyer (except in limited circumstances). Rule (Direct solicitations) Prohibits in person and real time solicitation of clients except lawyers and persons with whom the lawyer had a family, professional, or close personal relationship. Also imposes additional restrictions on direct mail solicitations to prospective clients known to need a particular type of legal service. Rule (Specialties) Restricts how and when a lawyer may claim to be an expert or specialist in a particular area of the law. 11 Advertising Regulations Rule Any Communication Rule Advertisements Rule 4 7.3(a) "solicit" real time 12 4

5 Missouri Rule All Communications A lawyer shall not make a false or misleading communication about the lawyer or the lawyer's services.a communication is false if it contains a material misrepresentation of fact or law.a communication is misleading if it: (a) omits a fact as a result of which the statement considered as a whole is materially misleading; (b) is likely to create an unjustified expectation about results the lawyer can achieve;( (c) proclaims results obtained on behalf of clients, such as the amount of a damage award or the lawyer s record in obtaining favorable verdicts or settlements, without stating that past results afford no guarantee of future results and that every case is different and must be judged on its own merits; (d) states or implies that the lawyer can achieve results by means that violate the Rules of Professional Conduct or other law; (e) compares the quality of a lawyer's or a law firm s services with other lawyers' services, unless the comparison can be factually substantiated; (f) advertises for a specific type of case concerning which the 379 lawyer has Words neither experience nor competence; (g) indicates an area of practice in which the lawyer routinely refers matters to other lawyers, without conspicuous identification of such fact; (h) contains any paid testimonial about or endorsement of the lawyer, without conspicuous identification of the fact that payment has been made for the testimonial or endorsement; (i) contains any simulated portrayal of a lawyer, client, victim, 11 scene, Sub Parts or event without conspicuous identification of the fact that it is a simulation; (j) provides an office address for an office staffed only part time or by appointment only, without conspicuous identification of such fact; or (k) states that legal services are available on a contingent or no recovery no fee basis without stating conspicuously that the client may be responsible for costs or expenses, if that is the case. 13 Missouri Rule (a) Subject to the requirements of Rule 4 7.1, a lawyer may advertise services through public media, such as a telephone directory, legal directory, newspaper or other periodical, outdoor advertising, radio, or television, or through direct mail advertising distributed generally to persons not known to need legal services of the kind provided by the lawyer in a particular matter. 14 Rule also Imposes Record keeping requirements Conspicuous Disclaimer "The choice of lawyer is an important decision and should not be based solely upon advertisements." "Tombstone" Exception ads that only include name, firm name, contact information, fields of practice, bar admissions 757 Words 20 Sub Parts 5

6 Rule Solicitations This Rule applies to in person and written solicitations by a lawyer with persons known to need legal services of the kind provided by the lawyer in a particular matter for the purpose of obtaining professional employment. 819 Words 18 Sub Parts 16 (a) In person solicitation. A lawyer may not initiate the in person, telephone, or real time electronic solicitation of legal business under any circumstance, other than with an existing or former client, lawyer, close friend, or relative. (b) Written Solicitation. A lawyer may initiate written solicitations to an existing or former client, lawyer, friend, or relative without complying with the requirements of this Rule 4 7.3(b). Written solicitations to others are subject to the following requirements: (1) any written solicitation by mail shall be plainly marked ADVERTISEMENT on the face of the envelope and all written solicitations shall be plainly marked ADVERTISEMENT at the top of the first page in type at least as large as the largest written type used in the written solicitation; (2)... (3) each written solicitation must include the following: Disregard this solicitation if you have already engaged a lawyer in connection with the legal matter referred to in this solicitation. You may wish to consult your lawyer or another lawyer instead of me (us). The exact nature of your legal situation will depend on many facts not known to me (us) at this time. You should understand that the advice and information in this solicitation is general and that your own situation may vary. This statement is required by rule of the Supreme Court of Missouri; 17 Rule A lawyer may communicate the fact that the lawyer does or does not practice in particular fields of law. Any such communication shall conform to the requirements of Rule Except as provided in Rule 4 7.4(a) and (b), a lawyer shall not state or imply that the lawyer is a specialist unless the communication contains a disclaimer that neither the Supreme Court of Missouri nor The Missouri Bar reviews or approves certifying organizations or specialist designations. 18 6

7 Summary Rule Say it only if you would swear to it... And could prove it. Rule Include the Choice of Lawyer disclaimer if more than (plain) business card Rule Beware soliciting non lawyer strangers Rule Expert! and special! require caution (and a disclaimer) 19 Missouri Rule 4 7.2(c) A lawyer shall not give anything of value to a person for recommending the lawyer's services, except that: (1) a lawyer may pay the reasonable cost of advertising or written communication permitted by this Rule 4 7.2; (2) a lawyer may pay the reasonable cost of advertising, written communication, or other notification required in connection with the sale of a law practice as permitted by Rule ; and (3) a lawyer may pay the usual charges of a qualified lawyer referral service registered under Rule or other notfor profit legal services organization

8 What Heightens Scrutiny (Sample) Claims about skill Claims of specialization Discussing past results Client (or other) testimonials Legal advice Client related information Lack of disclaimers 22 In re Dickey (SC 2012)

9 SEO and SEM SEO Search Engine Optimization SEM Search Engine Marketing ( PAY PER CLICK ) 25 SEM SEM SEO "Old" Results 26 Internet Advertising Pay per month/year OKAY Pay per view/click OKAY Pay per lead LIKELY OKAY Pay per client NOOOOO!!!! Percentage of fee earned is particular problem if shared with a non lawyer 27 9

10 28 Client Information (Confidentiality) Duty of Confidentiality Rule A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation, or the disclosure is permitted by Rule 4 1.6(b)

11 Duty of Confidentiality Missouri Rule Information from any source Relating to representation Limit on "revelation" Limit on "use" in Rule 1.8 Media reports Pleadings Client Lawyer Opposing counsel Third party Adverse party 31 The Myth of Privacy "There can be no reasonable expectation of privacy in a tweet sent around the world." People v. Harris (N.Y. Crim. Court 2012) 32 Internet vs. Privacy: "Helpful Venn diagram" The Internet Privacy By David Hoffman, available at

12 34 Protecting Information Model Rule 1.6(c): "A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client." 35 What Are "Reasonable" Protections? 36 12

13 Evaluation of Safeguards Factors to be considered in determining the reasonableness of the lawyer s efforts include, but are not limited to, the sensitivity of the information the likelihood of disclosure if additional safeguards are not employed the cost of employing additional safeguards the difficulty of implementing the safeguards (and) the extent to which the safeguards adversely affect the lawyer s ability to represent clients (e.g., by making a device or important piece of software excessively difficult to use) 37 Where Is the Data? 38 The "Cloud" 39 13

14 "Data Farms" 40 Terms of Service Google Docs (6/2015) 41 Terms of Service Dropbox (6/2015) 42 14

15 Data Lifecycle 43 Rule 1.6(c) Two More Caveats A client may require the lawyer to implement special security measures not required by this Rule or may give informed consent to forgo security measures that would otherwise be required by this Rule. Whether a lawyer may be required to take additional steps to safeguard a client s information in order to comply with other law, such as state and federal laws that govern data privacy or that impose notification requirements upon the loss of, or unauthorized access to, electronic information, is beyond the scope of these Rules. 44 What This Means? You need to protect client related information Even if it may help you market your practice... You should also consider extra steps for sensitive information Identifiers (social security number, etc.) Health Financial 45 15

16 Negative Review Someone posts negative (and false) information about Law Firm on Google Places Avvo Yelp What can Law Firm do in response? 46 Streisand Effect 47 LA County Bar Association Opinion 525 Therefore, under these circumstances, Attorney may respond to Former Client's internet posting, so long as: 1) Attorney's response does not disclose confidential information 2) Attorney does not respond in a manner that will injure Former Client in a matter involving the former representation; and 3) Attorney's response is proportionate and restrained

17 Client Information (Preservation) File Ownership The client s files belong to the client, not to the attorney representing the client. The client may direct an attorney or firm to transmit the file to newly retained counsel. In the matter of Cupples, 952 S.W.2d 226, 234 (Mo. banc 1997). 50 Missouri Rule A lawyer shall not: (a) unlawfully obstruct another party's access to evidence or unlawfully alter, destroy, or conceal a document or other material having potential evidentiary value. A lawyer shall not counsel or assist another person to do any such act; 17

18 Consequences of Spoliation In re Matthew B. Murray, (Virginia State Bar June 9,2013) lawyer was sanctioned $722K by trial court and suspended for 5 years Advised client to delete photos Withheld s instructing client to delete content 52 Ethical Guidance on Removal New York County Lawyers' Association Ethics Opinion 745 (2013) lawyer may advise his client to remove such postings from his social media website so long as the lawyer follows the law and ethics rules in regard to spoliation of evidence 53 Philadelphia Bar Ethics Committee (2014) Competence extends to advising and reviewing a client's social media account and settings as they relate to legal matters and litigation Lawyer must preserve a copy of postings that are relevant to litigation 54 18

19 Threats CryptoLocker Cybercriminals use social engineering to trick users to open certain attachments (which is actually CryptoLocker) Once opened, the CryptoLocker encrypts data and holds it hostage The owner then receives a ransom note telling the owner they will have to pay the cybercriminal (usually in Bit Coin) in order to un encrypt the data 55 Data Defenses Understand your data lifecycle Make good, frequent backups Train everyone regarding risks to data Maintain updated data protection systems (firewalls, anti virus programs, etc.) 56 Third Party Information (Discovery) 19

20 Accessing Information Rule (a) In representing a client, a lawyer shall not use means that have no substantial purpose other than to embarrass, delay, or burden a third person or use methods of obtaining evidence that violate the legal rights of such a person. (b) A lawyer who receives a document relating to the representation of the lawyer's client and knows or reasonably should know that the document was inadvertently sent shall promptly notify the sender. 58 "Passive" Viewing of Social Media Lawyers may access social media information available to general public NYSBA Opinion 843 (2010) SDCBA Ethics Op "Friending" a Represented Party May violate "Anti Contact" Rule Lawyer can't "friend" high ranking executives of represented corporation (SDCBA Ethics Op ) 60 20

21 Anti Contact Rule Rule In representing a client, a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or a court order. 61 Friending and Candor Hi. I m opposing counsel. Will you be my friend? Candid and OK Hi. Don t worry, I am not opposing counsel. (Cough) Will you be my friend? Deception and not okay Hi, I am Sally the (innocent) Secretary. Will you be my friend? (NYC Bar Okay; Philadelphia Bar Not okay) 62 Candor Obligations Rule In the course of representing a client a lawyer shall not knowingly: (a) make a false statement of material fact or law to a third person; or (b) fail to disclose a material fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by a client, unless disclosure is prohibited by Rule

22 No Deception Rule It is professional misconduct for a lawyer to: (a) violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another; (b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness, or fitness as a lawyer in other respects; (c) engage in conduct involving dishonesty, fraud, deceit, or misrepresentation.... (d) engage in conduct that is prejudicial to the administration of justice; 64 In re Eisenstein (Mo. 4/5/2016) Eisenstein represented Husband in divorce Husband accessed Wife's without permission, and gave Eisenstein documents including questions Wife's attorney had prepared for direct examination Eisenstein did not produce the documents received from Wife's , until giving them to opposing counsel as exhibits during trial 65 Consequences in Eisenstein Eisenstein was found to have used improperly obtained information (violating Rule 4 4.4) and concealing documents with evidentiary value (violating Rule 4 3.4) Eisenstein received an indefinite (minimum 6 month) suspension 66 22

23 Researching Jurors Communicating with Jurors (Rule 4 3.5(a)) ABA Opinion 466 (2014) Passive viewing is okay, but communicating is not "Unreasonable" for court to prevent lawyer from researching jurors on line during voir dire Carino v. Muenzen (N.J. 2010) 67 Firm Operations * Supervision * Payment Systems Virtual Law Practice Forbes: A virtual law office (or VLO) is "a law firm, run by a lawyer or group of lawyers, that meets the legal needs of its clients securely over the internet and through other technological tools." 69 23

24 VLO and Ethics #1 Candor about the practice VA Bar v. Sriskandarah (VSB 2012) reprimanded lawyer for claiming associates (really independent contractors) had specialties (with no focused practices) 70 VLO and Ethics #2 Admission in Appropriate Jurisdiction Where is work generated (where is client located)? Where is lawyer's "office"? 71 VLO & Ethics #3 Verification of client authority CA Opinion : "Whether Attorney must take additional steps to confirm the prospective client's identity will depend on the circumstances of the representation and initial communications, and the information Attorney obtains from the prospective client." 72 24

25 VLO & Ethics #4 Provision of competent services. Rule 4 1.1: "A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation." 73 VLO & Ethics #5 Adequate client communications. Missouri Rule requires a lawyer to keep a client reasonably informed about a matter. California Opinion : special issues in virtual practice At outset, does client understand legal matter adequately? Is client actually receiving information? 74 VLO & Ethics #6 Protection of Confidences Model Rule 1.6(c): "A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client." 75 25

26 The "Cloud" 76 VLO & Ethics #7 Adequate supervision of subordinates Missouri Rule and CA Opinion warns supervision can be quite challenging "if Attorney and her various subordinate attorneys and employees operate out of several different physical locations." 77 VLO & Ethics #8 Back up of data becomes critical Computer records may be only records 78 26

27 Credit Card Payments 79 Options for General Processor Receive only payments for past work (paid into operating account) OR Track fees deducted from operating account by processor... carefully 80 Problem Client deposits $1500 into trust account Then Bank withdraws $50 as its fee Client rejects charge ( chargeback ) Now only $1450 for Client in trust account 81 27

28 Legal Industry Processors Usually allow deposits in two accounts: Operating account (normal) Trust account (with all chargebacks and fees deducted from operating account) 82 Professionalism Concerns 28

29 85 The Rant of a Clerk 86 Tweet by KS Court Research Attorney Herr "Naughty, naughty boy "Why is Phil Klein (sic) smiling? There is nothing to smile about, douchebag." I predict that he will be disbarred for a period not less than seven years

30 Public Statement by Herr "I didn t stop to think that in addition to communicating with a few of my friends on Twitter I was also communicating with the public at large, which was not appropriate for someone who works for the court system." Disciplinary hearing panel found that Herr: engaged in conduct involving dishonesty, fraud, deceit or misrepresentation; engaged in conduct that is prejudicial to the administration of justice; and stated or implied an ability to influence improperly a government agency or official. 88 Thank You Michael Downey Downey Law Group LLC (314) (844) toll free mdowney@downeylawgroup.com 30