What is “Reasonable” in terms of Client Data Protection?

In spite of some recent high-level data breaches, a recent article which appeared in Legal Tech news, seems to indicate that law firms and lawyers are still not doing nearly enough to safeguard client’s data.[1]  This article indicates that the FBI first warned law firms back in 2009 and then repeated the warning in 2013 stating in no uncertain terms “We have hundreds of law firms that we see increasingly being targeted by hackers.”[2]

As though the FBI warnings were insufficient the ABA decided to add some comments to the Model Rules of Professional Conduct to advise lawyer’s what their ethical duties are with respect to cybersecurity.  Specifically, ABA model rules 1.1, 1.6 and 5.3 address technology and the lawyer’s duty therein (specifically, within the comments to the aforementioned rules).[3]  The article however indicates that Law Firms are still not doing enough and as a result they may be exposing their client’s data and exposing themselves to legal liability.[4]  Consequently, Toren suggests that Law Firms address three specific areas: (1) email security, (2) personal devices, and (3) unsecure Wi-Fi.[5]

Editor’s Comments

If Toren’s assertion that law firms are not doing enough to take reasonable steps to safeguard client data, then the three items that Toren lists seem to amount to no more than a drop in the proverbial bucket and would in my opinion fall far short of the standard of reasonableness articulated within the official comments to ABA Model Rules 1.1, 1.6, and 5.3; as well as various Ethics Opinions that have been drafted by various State Bars.

I would argue that first and foremost a law firm needs to conduct an assessment of the threats and more importantly the vulnerabilities in order to understand the current state of the firm.  Once that is complete a firm is better able to begin to articulate a plan for identifying the most pressing vulnerabilities as well as a process by which the vulnerabilities can be mitigated.

Furthermore, if one looks at this as a border security exercise where we simply “build a wall” then you fail to grasp the fact that your primary concern is in data security and preventing unauthorized data access, data breach, data modification, and data exfiltration.  To that end, looking at e-mail security and implementing password aging and complexity guidelines along with multi-factor authentication is probably going to end up on the list but that should be a step you get to, rather than where you actually start the process.  Similarly, with respect to personal devices and network access, a holistic approach wherein you treat data as the crown jewels and then build processes and procedures to safeguard these ‘jewels’ is going to result in a more comprehensive and effective cybersecurity strategy than changing your Wi-Fi password or restricting the use of personal devices.

I have said this in mixed company before and the rhetoric I often hear is that the ultimate step is to get to encryption but in the interim we are going to do X and Y.  However, in the context of a law firm, once you understand that data encryption is a must-have then I believe failing to do so falls below the threshold of “reasonableness”.  There are a number of services and options that law firms can employ (or even the sole practitioner); however, my viewpoint is if you have clear-text, unencrypted client data sitting on your workstations, your servers, in the cloud, or anywhere within your purview then your inability to encrypt the data using even a rudimentary bit-shifting algorithm is unethical.

So come on Law Firms, your clients are spending significant time and resources securing their data, then either as a result of litigation or perhaps in preparation for such, their data ends up in your law firm and if your cybersecurity efforts are weak or non-existent they ARE going to hold your firm responsible in the event of a breach or any unauthorized access.  Law Firms need to stop looking at cybersecurity as a non-billable cost center and realize that a mistake in this arena could spell disaster for the firm (just take a look at the effect a data breach had on Puckett & Faraj).[6]

[1] Peter J. Toren, Are You Making ‘Reasonable Efforts’ to Safeguard Your Client’s Information?, LegalTech news (Mar. 10, 2016), http://www.legaltechnews.com/id=1202751805610/Are-You-Making-Reasonable-Efforts-to-Safeguard-Your-Clients-Information?mcode=0&curindex=0&curpage=ALL.

[2] Id.

[3] See Model Rules of Prof’l Conduct R. 1.1 cmt. 8 (2013); Model Rules of Prof’l Conduct R. 1.6 cmt. 18 (2013); Model Rules of Prof’l Conduct R. 5.3 cmt. 3 (2013).

[4] Toren, supra note 1.

[5] Id.

[6] Matthew Goldstein, Citigroup Report Chides Law Firms for Silence on Hackings, (March 26, 2015), available at http://www.nytimes.com/2015/03/27/business/dealbook/citigroup-report-chides-law-firms-for-silence-on-hackings.html?_r=0.

What is “Reasonable” in terms of Client Data Protection?

In spite of some recent high-level data breaches, a recent article which appeared in Legal Tech news, seems to indicate that law firms and lawyers are still not doing nearly enough to safeguard client’s data.[1]  This article indicates that the FBI first warned law firms back in 2009 and then repeated the warning in 2013 stating in no uncertain terms “We have hundreds of law firms that we see increasingly being targeted by hackers.”[2]

As though the FBI warnings were insufficient the ABA decided to add some comments to the Model Rules of Professional Conduct to advise lawyer’s what their ethical duties are with respect to cybersecurity.  Specifically, ABA model rules 1.1, 1.6 and 5.3 address technology and the lawyer’s duty therein (specifically, within the comments to the aforementioned rules).[3]  The article however indicates that Law Firms are still not doing enough and as a result they may be exposing their client’s data and exposing themselves to legal liability.[4]  Consequently, Toren suggests that Law Firms address three specific areas: (1) email security, (2) personal devices, and (3) unsecure Wi-Fi.[5]

Editor’s Comments

If Toren’s assertion that law firms are not doing enough to take reasonable steps to safeguard client data, then the three items that Toren lists seem to amount to no more than a drop in the proverbial bucket and would in my opinion fall far short of the standard of reasonableness articulated within the official comments to ABA Model Rules 1.1, 1.6, and 5.3; as well as various Ethics Opinions that have been drafted by various State Bars.

I would argue that first and foremost a law firm needs to conduct an assessment of the threats and more importantly the vulnerabilities in order to understand the current state of the firm.  Once that is complete a firm is better able to begin to articulate a plan for identifying the most pressing vulnerabilities as well as a process by which the vulnerabilities can be mitigated.

Furthermore, if one looks at this as a border security exercise where we simply “build a wall” then you fail to grasp the fact that your primary concern is in data security and preventing unauthorized data access, data breach, data modification, and data exfiltration.  To that end, looking at e-mail security and implementing password aging and complexity guidelines along with multi-factor authentication is probably going to end up on the list but that should be a step you get to, rather than where you actually start the process.  Similarly, with respect to personal devices and network access, a holistic approach wherein you treat data as the crown jewels and then build processes and procedures to safeguard these ‘jewels’ is going to result in a more comprehensive and effective cybersecurity strategy than changing your Wi-Fi password or restricting the use of personal devices.

I have said this in mixed company before and the rhetoric I often hear is that the ultimate step is to get to encryption but in the interim we are going to do X and Y.  However, in the context of a law firm, once you understand that data encryption is a must-have then I believe failing to do so falls below the threshold of “reasonableness”.  There are a number of services and options that law firms can employ (or even the sole practitioner); however, my viewpoint is if you have clear-text, unencrypted client data sitting on your workstations, your servers, in the cloud, or anywhere within your purview then your inability to encrypt the data using even a rudimentary bit-shifting algorithm is unethical.

So come on Law Firms, your clients are spending significant time and resources securing their data, then either as a result of litigation or perhaps in preparation for such, their data ends up in your law firm and if your cybersecurity efforts are weak or non-existent they ARE going to hold your firm responsible in the event of a breach or any unauthorized access.  Law Firms need to stop looking at cybersecurity as a non-billable cost center and realize that a mistake in this arena could spell disaster for the firm (just take a look at the effect a data breach had on Puckett & Faraj).[6]

[1] Peter J. Toren, Are You Making ‘Reasonable Efforts’ to Safeguard Your Client’s Information?, LegalTech news (Mar. 10, 2016), http://www.legaltechnews.com/id=1202751805610/Are-You-Making-Reasonable-Efforts-to-Safeguard-Your-Clients-Information?mcode=0&curindex=0&curpage=ALL.

[2] Id.

[3] See Model Rules of Prof’l Conduct R. 1.1 cmt. 8 (2013); Model Rules of Prof’l Conduct R. 1.6 cmt. 18 (2013); Model Rules of Prof’l Conduct R. 5.3 cmt. 3 (2013).

[4] Toren, supra note 1.

[5] Id.

[6] Matthew Goldstein, Citigroup Report Chides Law Firms for Silence on Hackings, (March 26, 2015), available at http://www.nytimes.com/2015/03/27/business/dealbook/citigroup-report-chides-law-firms-for-silence-on-hackings.html?_r=0.