Legal Ethics Forum

Cloud Computing for Lawyers - New York City Bar Issues Report

Cloud computing raises numerous ethical issues that can confound and confuse even the most sophisticated lawyer.  A new report by the Small Firm Committee of the New York City Bar Association discusses the practical, economic and ethical implications of using the cloud.  A section of the report contains a round-up of the various ethics issues that lawyers should consider before using the cloud.  The main thrust of the report is that lawyers must take reasonable steps when using cloud services to ensure that they comply with their ethical obligations, including the duties of confidentiality, competence, supervision, communication, and record-keeping. In addition, the report contains a number of suggested guidelines, including:

• Use reliable and established cloud providers
• Perform your own due diligence on cloud providers
• Review provider contracts
• Focus on key contractual terms, such as ownership of data, back-up practices, data storage, locations, access to data, security, breach notifications, subpoena notices, and more
• Get client consent, where appropriate
• Understand the technology to the extent reasonable
• Ensure that data stored in the the cloud is encrypted
• Establish data management policies and procedures

The ultimate conclusion is that cloud computing is ethically permissible, but lawyers must exercise reasonable care when using the cloud.

 

No-poaching rule in ethics code of music teachers draws FTC's attention

This story in the Wall Street Journal about the FTC's crackdown on a small non-profit association brings back memories of Goldfarb v. Virginia (i.e, in both cases, ethics codes contained provisions affecting price). The article is has a strong anti-FTC viewpoint, but for me the matter brought to mind Adam Smith's famous quote: "people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."

Well into the story we learn that the FTC wanted the non-profit group to hire an antitrust compliance monitor who was a lawyer -- bringing to mind the recent articles Veronica Root has written about the new monitor-client relationship.

"Trustee Liquidating Dewey & LeBoeuf Seeks $21.8 Million"

Wall Street Journal carries the story. Excerpt:

The trustee liquidating failed New York law firm Dewey & LeBoeuf LLP filed a $21.8 million complaint Wednesday against two of the firm's leaders, former Executive Director Stephen DiCarmine and former Chief Financial Officer Joel Sanders.

The complaint outlines a number of alleged financial irregularities at the firm—whose management is the focus of an ongoing criminal investigation—including $1.2 million loans to Mr. DiCarmine and Mr. Sanders. The suit seeks to claw back lavish compensation packages the pair received in the years leading up to Dewey's 2012 collapse.

According to the complaint, filed in bankruptcy court in Manhattan, "payments under the Employment Contracts to DiCarmine and Sanders totaled $15,900,000 over six years—with an opportunity for unlimited discretionary bonuses—an astronomically generous arrangement for law firm administrators, and far in excess of the reasonably equivalent value of the services contracted for or provided."

A Signal Honor

The lead item in the first issue of the eJournal that was sent to me (vol. 13, no. 51) features an article responding to an article of mine.  My article is “The Use of Unethical and Unconstitutional Practices and Policies by Prosecutors’ Offices,” 52 Washburn L. Jour. 1 (2012).  The response is by Charles E. Maclean,  "Anecdote as Stereotype:  One Prosecutor's Response to Professor Monroe Freedman's Article 'The Use of Unethical and Unconstitutional Practices and Policies by Prosecutors' Offices'."  Allow me a brief reply.

I illustrate those unethical and unconstitutional policies and practices with actual cases defended by prosecutors’ offices and with public statements by prosecutors’ offices (including the U.S. Dept. of Justice).  Professor Maclean refers to those cases and public statements as “a few anecdotes.”  He then claims – with no empirical evidence at all – that most prosecutors “selected their prosecutorial career path to do good works, to serve the public, to seek justice, and to protect the defendant as much as the victim and society.”

I also relied on a 2001 computerized study by Fred Zacharias showing that there have been only 100 federal and state disciplinary cases against prosecutors in the previous century.  Maclean responds that the reality of sanctions today is “starkly different,” noting that from 2001 to 2012, at least thirty prosecutors have been disbarred or forced to resign and retire.  However, Maclean’s supporting footnote shows that at least half of those cases involve conduct that have nothing to do with the subject of my article, which is improper prosecutorial conduct directed against criminal defendants.  Rather, Maclean’s cases include conduct such as obtaining controlled substances by deceit; embezzling funds from the Connecticut Association of Prosecutors;  conviction of criminal extortion; conviction of “sexual impositions on staff members” of his office; conviction for extortion; soliciting, accepting, and extorting bribes to fix criminal cases (4 different cases); prosecuting a judge without probable cause; sexually assaulting two women under color of law; embezzling traffic fines for personal use; practicing as a prosecutor without a license; distributing over $42,000 in witness vouchers to unauthorized persons; and repeatedly stealing cocaine from an evidence locker and replacing it with flour.

It's possible that there has been some increase in disciplinary proceedings against prosecutors – prompted in major part by Innocence Projects that have exposed prosecutorial abuse – and if so, it is a welcome development.  But it hardly justifies the kinds of ethical and constitutional abuses of defendants’ rights that I have documented, and which show little if any signs of diminishing.

[links added by JJS]

California appellate court recognizes exception to rule against assignment of legal malpractice claims

The first few sentences explain:

There is a general rule in California barring the assignment of a cause of action for legal malpractice. In this case, we recognize a narrow exception to that rule. Specifically, a cause of action for legal malpractice is transferable when (as here): (1) the assignment of the legal malpractice claim is only a small, incidental part of a larger commercial transfer between insurance companies; (2) the larger transfer is of assets, rights, obligations, and liabilities and does not treat the legal malpractice claim as a distinct commodity; (3) the transfer is not to a former adversary; (4) the legal malpractice claim arose under circumstances where the original client insurance company retained the attorney to represent and defend an insured; and (5) the communications between the attorney and the original client insurance company were conducted via a third party claims administrator.

White Mountains Reinsurance Co. of Am. v. Borton Petrini, LLP, C071365, 2013 WL 6181126 (Cal. Ct. App. Nov. 26, 2013)

James A. Johnson, "CUMIS Counsel"

Article. (Note: this is a very short article that collects citations from a variety of states.) Abstract:

CUMIS Counsel or independent defense counsel is a term that comes from the seminal conflict of interest case in California, Navy Federal Credit Union v. Cumis Ins. Society Inc. This case holds that a liability insurance carrier must pay for independent counsel and not use its own selected counsel where coverage issues are reserved that create a conflict of interest between the carrier and the policyholder.

This article sets out the current law regarding a conflict of interest in a reservation of rights context in New York, Texas, California, Michigan, Ohio, Indiana, Illinois, Minnesota, Wisconsin, Kentucky, Tennessee, Connecticut and Massachusetts.

A number of ethical issues arise for an attorney advising a client who has received a reservation of rights letter from its liability insurance carrier. The case law of the 50 states differ widely. However, an attorney in all jurisdictions who advises a client has an ethical obligation to educate that client as to his rights, obligations, conflicts and risks in demanding cumis counsel or choosing his own attorney.

"Bringing the Disruption of the Legal Services Market into the Law School Classroom"

Bill Henderson, at Legal Whiteboard, recounts his students' presentations on the new generation of legal services providers.

Facebook rants leads to reversal of administrative decision against registered offender

For reasons that will soon be obvious, I'm doing this post in Arial font.

Hat tip to Eric Goldman, who carries a story about a hearing examiner whose Facebook rants about registered sex offenders (and about using the Arial font) led to a re-hearing for an offender. Excerpt of the rants:

a. “it’s always awkward when I see one of my pervs in the parking lot after a hearing”;
b. he (the hearing examiner) “likes taking motions under advisement, but gets greater satisfaction denying them”;
f. he “can’t trust someone who drafts a letter in arial font!”;
g. he “thinks attorneys should know that arial font is not appropriate for motions” followed up with “I might be biased. I think arial is inappropriate for most things”;
i. he “had to lay some smack down on some crazy attorney!!”;
k. The entry above was followed by: he “just sat through a 2.5 hour direct examination! Hearings generally last an hour”;
l. he “is off to jail for the day! Let’s hope he doesn’t get shanked”;

Beyond Moral Pluralism, Part I

I recently re-read David Luban's review of Brad Wendel's Lawyers and Fidelity to Law, in which Luban comments that academics of roughly my generation have an abiding concern with moral pluralism and tend to criticize moral philosophers for giving too little weight to the political dimension of legal choices and roles.

I think this observation is fair as far as it goes but, speaking only for myself, I'd add one more: Skepticism about the payoffs to lawyering that seeks to advance a general moral view, such as proper treatment of the poor or criminal defendants. 

Prof. Amsterdam on Legal Education

A few days ago I came across a 1985 lecture by Anthony Amsterdam concerning legal education.  Download Prof. Amsterdam - AGA's Cambridge Speech  It is well worth reading now.  It is available elsewhere on the Internet but it is not easy to find unless you are looking for it.  As we have been discussing the future of legal education, I thought it might be useful to post here.  

DM