Thursday, March 28, 2013

New Roundtable Meetings Set for Los Angeles & San Francisco (Joining Atlanta, Philly & Houston Sessions)


We've announced locations and dates for two more Risk Roundtable sessions. This particular series of sessions is focused specifically on information governance and security, and will aim to discuss the following questions:
  • What technologies can firms adopt to manage risk without compromising collaboration?
  • What processes and policies should firms implement to comply with client mandates and government regulations?
  • What techniques can risk stakeholders adopt to foster security and risk awareness amidst lawyers and staff while preserving firm values and culture?
Sessions are currently scheduled for:
  • Atlanta, April 9th
  • Houston, April 10th
  • Philadelphia, April 11th
  • Los Angeles, April 30th
  • San Francisco, May 1st
To read summaries from past events, visit: RiskRountable.com.

Attendance is by invitation only and is limited to qualified law firms and personnel. Please contact info@riskroundtable.com for more details.

Tuesday, March 26, 2013

Risk News: Patents, Conflicts and Advanced Waivers

New updates of interest. Via Bill Frievogel comes:

Philadelphia Bar Association Ethics Opinion 2012-11 (issued Jan, 2013) -- "Co. A, a client of Law Firm, asks Law Firm to write an opinion letter to Co. B stating that Co. A's product does not infringe Co. B's patent. Co. B is a client of Law Firm on matters unrelated to the product. In this opinion the committee held that writing the opinion would be directly adverse to Co. B. The committee cited Va. Op. 1774 (2003) and Andrew Corp. v. Beverly Mfg. Co., 415 F. Supp. 2d 919 (N.D. Ill. 2006), the only authorities known to us on this subject."

Galderma Labs., L.P. v. Actavis Mid Atl. LLC, 2013 U.S. Dist. LEXIS 24171 (N.D. Tex. Feb. 21, 2013) -- "This is a patent infringement case. Law Firm represents Defendant. At the time this case was filed, Law Firm was doing employment work for Plaintiff. Plaintiff's in-house general counsel had signed an advanced waiver agreeing that Law Firm could take on unrelated matters adverse to Plaintiff. Plaintiff moved to disqualify Law Firm in this case. In this opinion the court denied the motion. The opinion is a comprehensive discussion of many of the authorities dealing with advance waivers. Most significantly, the court specifically disagreed with a contrary holding with very similar circumstances in Celgene Corp. v. KV Pharm. Co., 2008 U.S. Dist. LEXIS 58735 (D.N.J. July 29, 2008)."

Additionally, our friends at the Legal Ethics Forum hosted interesting discussion on the advance conflicts waivers piece we posted last week. See the complete thread for more detail --
  • John Steele: "...I've seen some of the OCGs get more and more expansive and have wondered when the case law and ethics opinions would start looking at how far they can go... I have an intuition that at some point the OCG restrictions are troubling from the point of view of creating other conflicts, reducing independence, and being agreements that the two parties don't really intend to live up to. I'd agree that the first line of resistance to any over reaching OCGs should be the law firms refusing to sign them."
  • Stephen Gillers: "Or the opposite. The OCG can make the demand because the firm wants the business, often because there's a lot of it. So the firm agrees. Who would decline to be outside GC for Apple if the condition was never to work for a competitor on anything so long as Apple was a client? Anyway, even if the OCG does not request the restriction but then firm begins to represent a competitor, the OCG can let it be known that the company is prepared to change counsel and the reason. The firm will quickly view the competitor's work as a business conflict, assuming it did not anticipate that at the outset."

Monday, March 25, 2013

Ethical Walls (Information Barriers) and "Commercial/Business" Conflicts

A reader sent word of an interesting story of the use of ethical walls/information barriers in a non-ethical, business/commercial conflicts scenario:

"Ithaca-Valiant legal fees near £1.5m as Herbies, Pinsents erect Chinese walls" --
  • "CMS Cameron McKenna and Herbert Smith Freehills (HSF) are the chief recipients of nearly £1.5m in fees from a £203m energy takeover that saw two law firms put up Chinese walls to prevent potential conflicts."
  • "Pinsent Masons advised Ithaca on banking arrangements, putting forward Edinburgh partner Iain Macaulay. He worked on the other side of a Chinese wall from Glasgow corporate partner Rosalie Chadwick, who led the firm’s due diligence role for Valiant. Ithaca’s UK headquarters are in Aberdeen."
  • "The barrier was put up as an extra precaution to avoid what could have been perceived as a commercial conflict, but the fact that Pinsents was not Valiant’s main corporate adviser meant the risk of improper practice was low."
  • "Valiant’s main corporate adviser was HSF, which also put up a Chinese wall due to a dual role for the target and Ithaca’s lenders... HSF was able to take the double role after negotiating the Chinese wall with Valiant and the banks. It took most of the £860,000 fees paid by Valiant, with some going to Bennett Jones, the Canadian counsel to the company."

Thursday, March 21, 2013

Law Firm Conflicts & Disqualification Attempts

Several recent conflicts stories of note:

"Steptoe & Johnson beats disqualification request made by Verizon" --
  • "The law firm Steptoe & Johnson won’t be disqualified from representing a group of former Verizon workers in class action lawsuits against the company... Verizon had argued that Rector’s previous representation of two plaintiffs and his intent to use evidence filed under seal during their lawsuits on subsequent lawsuits presented a conflict of interest."
  • "'At issue are the obligations imposed upon Steptoe by the agreed protective orders and confidential settlement agreements entered in the Rowh and Radcliff cases,' Davis wrote... 'However, Verizon has not demonstrated that Steptoe has violated either of these provisions, and the terms of these documents simply do not restrict Steptoe’s representation of subsequent clients in substantially related matters... Neither do they prohibit Steptoe, in the current litigation, from requesting the same information through discovery that Verizon disclosed in the prior cases or from obtaining a new protective order to protect this information once it has been disclosed within the confines of the case.'"
"Lawyer at Phoenix Sinclair inquiry found in conflict" --
  • "A Winnipeg law firm could be on the hook for costs associated with the latest delay in the Phoenix Sinclair inquiry. The inquiry was put back on hold Tuesday morning after commissioner Ted Hughes ruled on lawyer Kris Saxberg's conflict of interest."
  • "On Tuesday morning, Hughes blamed Saxberg and his law firm, D'Arcy Deacon, for not taking a good look at the client load to determine possible conflicts... Hughes said Saxberg created the conflict by taking so many retainers, and the inquiry will consider billing the law firm for costs arising from the conflict and its delays."
"Law firm is disqualified for impermissible concurrent conflict of interest" --
  • "Defendant moved to disqualify plaintiff’s lead counsel asserting, inter alia, that, at the time litigation was initiated, plaintiff’s counsel was serving as defendant’s opinion counsel. The motion was granted. The six-year history between defendant and plaintiff’s counsel wherein three opinion letters were prepared was sufficient to instill in defendant a reasonable belief that it would not be sued absent some sort of prior notice terminating the attorney-client relationship."

Wednesday, March 20, 2013

Advance Conflict Waivers: Opinions & News

A few interesting waiver related stories in the news:

"Advance Conflicts Waiver in Retainer Allows Firm to Represent One Client Against Another" --
  • "A general, open-ended advance waiver of future conflicts in a law firm's retainer agreement with a sophisticated client represented by in-house counsel makes it permissible for the firm to represent the client's opponent in unrelated litigation, the U.S. District Court for the Northern District of Texas concluded Feb. 22, denying a disqualification motion (Galderma Laboratories LP v. Actavis Mid Atlantic LLC, N.D. Tex., No. 3:12-cv-2038-K, 2/22/13)."
  • "Three types of disclosure by the law firm support a finding that the broad waiver language in the engagement letter provided enough information to allow the client to provide informed consent, he ruled."
  • "In analyzing the conflicts issue, Kinkeade chose to apply the national standards as embodied in the Model Rules, which prohibit lawyers from representing a current client's opponent even in unrelated matters except with the client's informed consent, rather than Texas's more permissive conflicts rules, which allow firms to oppose current clients in most unrelated matters without having to obtain the client's informed consent."
"It’s Not Easy to Limit Representation So That Another Client Will Waive Conflict" --
  • "Outside counsel for a corporate client may not freely go along with restrictions that the company wants to impose as a condition of waiving conflicts of interest involving the lawyer's other clients, according to a Jan. 28 opinion from the Michigan bar's ethics committee (Michigan State Bar Comm. on Professional and Judicial Ethics, Informal Op. RI-358, 1/28/13)."
  • "The lawyer must not agree to a limitation the corporate client demands if it would preclude her from disclosing to the other client information necessary to pursue the objectives of the representation, the committee made clear."
  • "The opinion sets out a multiple-step process for lawyers to follow in determining whether they can limit a prospective or current client's representation to accommodate another client's conditions for granting a conflict waiver."

Tuesday, March 19, 2013

HIPAA for Law Firms -- Webinar Recording Now Online

For those who missed the live presentation and panel discussion, we have a recording of our recent webinar on HIPAA for Law Firms.

The 2013 HIPAA Omnibus Rule raises the stakes for firms. Under the new rules, firms that interact with protected health information (PHI) are directly liable for compliance with the entire HIPAA Security Rule and select provisions of the Privacy Rule.
In this session, a panel that included speakers from Hunton & Williams and Carlson & Wolf reviewed how firms can best respond. Topics included:
  • Analysis of key regulation changes that impact law firms
  • Explanation of HIPAA Security Rule requirements
  • Overview of breach notification requirements
  • Assessment of penalties for non-compliance
  • Overview of technologies available to remediate compliance gaps
  • Best practices for information security

Wednesday, March 13, 2013

Upcoming Risk Roundtable Events: Atlanta, Houston, Philadelphia, San Francisco


We've announced locations and dates for several upcoming Risk Roundtable sessions. This particular series of sessions is focused specifically on information governance and security, and will aim to discuss the following questions:
  • What technologies can firms adopt to manage risk without compromising collaboration?
  • What processes and policies should firms implement to comply with client mandates and government regulations?
  • What techniques can risk stakeholders adopt to foster security and risk awareness amidst lawyers and staff while preserving firm values and culture?
Sessions are currently scheduled for:
  • Atlanta, April 9th
  • Houston, April 10th
  • Philadelphia, April 11th
  • San Francisco, May 1st 
Attendance is by invitation only and is limited to qualified law firms and personnel. Please contact info@riskroundtable.com for more details.

Sunday, March 10, 2013

Reminder: New HIPAA Rule Impact on Law Firms

Our webinar this week features a panel that will review recent HIPAA rule updates that create new requirements for law firms. If your firm provides services to the healthcare or insurance industry, or has practices that manage qualified protected health information, this session is for you.

The 2013 HIPAA Omnibus Rule raises the stakes for law firms. Under the new regulations, firms that interact with protected health information (PHI) are directly liable for compliance with the entire HIPAA Security Rule and select provisions of the Privacy Rule.

Our speakers will review how key rule changes affect law firms and how law firms can best respond. Topics will include:
  • Analysis of key regulation changes that impact law firms
  • Explanation of HIPAA Security Rule requirements
  • Overview of breach notification requirements
  • Assessment of penalties for non-compliance
  • Overview of technologies available to remediate compliance gaps
  • Best practices for information security
Speakers:
We're pleased to feature several speakers, including Lisa Sotto from Hunton & Williams, who has been rated as the #1 privacy expert for three consecutive years by Computerworld magazine.


Date: Wednesday, March 13
Time: 9 am Pacific / 12 pm Eastern
Duration: 75 minutes

CLE CREDIT: As a certified as a CLE approved educator by the State Bar of California, we are able to provide California certificates to attendees upon request. (Attendees are responsible for confirming CLE reciprocity in their particular jurisdiction. We are happy to provide additional information required to receive credit outside of California, bttendees are responsible for researching and identifying information for their local jurisdictions and filing any necessary paperwork.)

Attendance is by invitation only. For more information, please contact: info@riskroundtable.com.

Wednesday, March 6, 2013

Professional Responsibility & Rule Setting

Hat tip to John Steele at the Legal Ethics Forum for calling out a few artilces of interest:

Douglas R. Richmond: "Watching Over, Watching Out: Lawyers' Responsibilities for Nonlawyer Assistants" --
  • "Lawyers depend on the support of many different non-lawyer assistants in order to practice successfully. Unfortunately, these assistants sometimes err and are occasionally guilty of deliberate misconduct. Either way, courts and professional authorities may hold the employing or supervising lawyers responsible under Model Rule of Professional Conduct 5.3 and state analogs, as well as tort and agency law principles."
  • "But if lawyers’ supervisory responsibilities for their non-lawyer assistants seem obvious, it is also true that lawyers all too often fail in them — or perhaps fail to appreciate or recognize them until it is too late. "
  • "Moreover, despite the importance of lay assistants in the practice of law and the many cases in which lawyers have been disciplined under Rule 5.3 for failing to supervise assistants, scholarship on lawyers’ related duties is scarce. Lawyers and courts alike suffer from the resulting lack of guidance on key issues."
  • "This Article is intended to remedy that deficiency. In doing so, it carefully maps the contours of lawyers’ supervisory duties in this context and analyzes several issues that regularly ensnare practicing lawyers or which present special challenges."
  • "Importantly, the Article explains why lawyers who fail in their supervisory duties must be disciplined on that basis rather than being held vicariously liable for assistants’ misconduct. This is an enormously important issue in practice and, regrettably, one that some state supreme courts miss."
Stephen Gillers, "How to Make Rules for Lawyers: The Professional Responsibility of the Legal Profession" --
  • "Using diverse lawyer regulatory issues that have arisen in the ABA, courts, and other venues across the last forty years, this Article examines in detail the methodology and styles of argumentation that lawyers use to support or defeat change. Regulatory issues addressed include non-lawyer ownership of law firms, fee-sharing with non-lawyers, collaborative law, and a requirement that fee agreements with clients be in writing, Recommendations for improvement in the process of rule making are offered."
And finally: "Do you ‘get’ OFR?" --
  • "A number of positives are revealed in a recent survey conducted by the Solicitors Regulation Authority. Most notably, a year after the implementation of outcomes-focused regulation (OFR) and perhaps understandably, firms’ attitudes are shifting towards greater levels of acceptance as they increase their experience of working with the new regime of regulation."
  • "Measuring the impact of OFR on firms, released last week, found that 50% of respondents felt ‘favourable’ about OFR, a welcome increase on the previous year’s 36%. However, that still leaves the other 50% to be convinced."

Tuesday, March 5, 2013

Report from Sydney Risk Roundtable

Last week, we held our inaugural Australian Risk Roundtable meeting in Sydney, Australia. Many thanks to K&L Gates for hosting. Pat Archbold, Head of IntApp’s Risk Practice, delivered a presentation about emerging challenges firms around the world are facing with respect to information security, risk management and compliance. He sends this update:
  • Dan -- I’m pleased to report back a successful Risk Roundtable session in Sydney, Australia. K&L Gates was generous enough to host a very large and active group of risk management and technology leaders. This is the first time we’ve held a session in Australia, and we look forward to charting local risk trends and developing future programs here.
  • The group agreed that while firms are successfully managing information security issues today, these issues are quickly becoming more challenging to deal with. Many attending firms are looking to improve their information security processes and strategies in response to increasing pressure from clients.
  • There was a good deal of discussion around evolving anti-money laundering (AML) requirements, file reviews and information retention. One participant mentioned that his firm is seeing an increasing number of Outside Counsel Guidelines (OCGs) that conflict with existing firm policies, spurring active discussion around how to remedy the variance between standard and specific procedures.
  • Finally, we had a quick discussion about the conflicts process as a whole, and focused on how to modify the intake process to obtain more comprehensive matter information at matter inception.
Our co-host, Dion Cusack, Corporate Services Manager with K&L Gates sends notes as well:
  • It was a pleasure to co-host with IntApp colleagues from other firms around Australia to discuss the commitment we all share in improving the quality of legal advice and service we provide our clients, while at the same time minimising the risks to our own firms.
  • As the discussion evolved it was evident that we all face similar challenges and issues in the mitigation of risk. Some of the issues are not new, for example conflicts, document management and retention strategies, staff supervision and performance, which continue remain high on the risk registers of most firms. While at the same time, there are significant new and emerging risks that all law firms will need to be proactive in managing.
  • As Pat mentioned information security is an emerging issue, which in my view should be high on the risk register of all law firms. Law firms today process greater amounts of information both internally and externally than ever before. Firms create, use, disseminate, edit, store, retrieve and secure information in so many different ways, using a variety of systems, processes and devices, while at the same time the nature of work is changing and becoming more flexible and mobile. This creates greater vulnerabilities to both client and firm information, which consequently attaches a diversity of reputational, financial or operational impacts if not managed effectively. From the discussion there was acknowledgment that a more sophisticated response to the management of information security is now required.

Monday, March 4, 2013

Recent Ethics Opinions (Law Firm Conflicts, Cloud Storage, and Other Clouds...)

[h/t to the Professional Responsibility blog for highlighting several updates] --

Illinois State Bar Association's Board of Governors issued three opinions, including:
  • Opinion No. 13-02: Arbitration and Mediation; Conflict of Interest; and Multiple Representation -- A lawyer ordinarily represents a partnership as an entity for conflicts of interest purposes. Where a lawyer has represented a partnership and all individual partners in various matters in a common representation, and one partner subsequently files an arbitration matter against another partner, whether the lawyer may represent the defending partner with informed consent will depend on the circumstances. Similarly, whether the lawyer can continue to represent the partnership or any of the partners in other matters with informed consent will depend on the circumstances.
Florida issues opinion on lawyer use of cloud sources to store confidential information:
  • Summary: "Generally approving of other States’ previous advisory opinions regarding this matter, the Florida’s proposed opinion focuses on an attorney’s duty to perform due diligence in investigating a vendor’s “terms and conditions” prior to storing sensitive client information on that vendor’s cloud computing service. Notably, the Committee reiterates New York’s recommendation to limit the use of cloud computing services to vendors who contractually agree to preserve confidentiality and security."
Connecticut Bar association issues ethics opinion on medical marijuana --
  • Summary: "The Connecticut Bar Association ethics committee has issued an informal opinion saying that lawyers can help businesses that want to cultivate marijuana for distribution to chronically ill patients navigate the regulatory process for obtaining a state license."