Originally published as Ethics Watch, Technology and Ethics (“Technethics”) – 2013 in Review in the South Carolina Lawyer in March 2014
In past years I have written a year-in-review Ethics Watch column, covering significant South Carolina ethics decisions and opinions, along with ABA Formal Opinions issued during the year.
Because technology is playing an increasingly important role in the practice of law, I have decided to change the focus of the annual review column from South Carolina ethics to important developments in technology and ethics around the country. For ethics developments in South Carolina during 2013 see the website to the Annotated South Carolina Rules of Professional Conduct. See browser > “Annotated South Carolina Rules of Professional Conduct.”
New Florida advertising rules.
On January 31, 2013, the Florida Supreme Court issued new rules on lawyer advertising. One of the most significant aspects of the new rules is that all statements by attorneys must be “objectively verifiable.” In addition, the new rules apply to all forms of lawyer advertising, regardless of whether the information was sought on request, as is the case with websites, social networking, or video sharing sites. All advertisements (other than websites) must be filed 20 days before their planned use unless they are exempt. The Florida Bar Board of Governors has issued guidelines on a number of issues. Lawyers in other states who advertise in national media can avoid application of the Florida rules if they include a disclaimer “cases not accepted in Florida.” The rules also do not apply to website advertisements if they do not offer the services of a Florida bar member, a lawyer located in Florida, or a lawyer offering to provide services in Florida. Rule 4-7 (comments).
Judge Scheindlin orders adverse inference instruction on behalf of defendant for plaintiff’s gross negligence in failing to timely institute litigation hold.
In Sekisui American Corp. v. Hart, 945 F. Supp. 2d 494 (S.D.N.Y. 2013), Judge Shira Scheindlin has added another important opinion to the law of electronic discovery. In 2003-2005 Judge Scheindlin issued five rulings in the Zubulake case that have become the basis of much of the law with regard to the obligations of lawyers and clients in dealing with discovery of electronically stored information (ESI). Id. at fn 1. Sekisui deals with the standard for imposing sanctions for failure to institute a litigation hold. Judge Scheindlin found that Sekisui was grossly negligent in failing to institute a litigation hold in a timely fashion and that prejudice could be presumed because of its culpability.
The decision is significant in several other respects. First, while motions for sanctions for failure to preserve ESI are usually directed against defendants, it is clear that the obligation also applies to plaintiffs, as in Sekisui. Second, the case also illustrates the principle that the trigger for a litigation hold can often precede the filing of a lawsuit. Ironically, in Sekisui the plaintiff pulled the trigger that shot its own case. Third, for lawyers and judges looking for model language of an adverse inference instruction, Judge Scheindlin’s opinion, which contains the instruction she plans to give at trial, is an excellent source. For a more detailed discussion of this case, see my blog in www.technethics.com.
Are blogs “advertising” subject to the ethical restrictions governing commercial communications? Hunter v. Virginia State Bar, 744 S.E.2d 611 (Va. 2013), deals with the question of whether blogs are subject to the rules of professional conduct. Attorney Hunter, a criminal defense lawyer, wrote a blog on his firm website discussing recent cases of interest in Virginia, most of which were cases Hunter successfully handled. The Virginia State Bar claimed that the blog was subject to the rules of professional conduct and charged Hunter with two violations: failure to include a disclaimer on the blog dealing with case results and disclosure without client consent of information about client cases even though such information had been revealed in court. The Virginia Supreme Court agreed with the Bar on the disclaimer issue. Considering a number of factors, the court held that Hunter’s blog was commercial rather than political speech and therefore could be regulated by the bar. The court held that the requirement of a disclaimer met the three-pronged test established by the Supreme Court in Central Hudson Gas & Elec. Corp. v. Public Serv. Comm., 447 U.S. 557 (1980). In particular, the Supreme Court had previously approved the requirement of disclaimers to avoid misleading the public. However, on the second charge, violation of the duty of confidentiality, the court held that Hunter’s blog postings were constitutionally protected: “a lawyer is no more prohibited than any other citizen from reporting what transpired in the courtroom.” The Supreme Court has denied certiorari in the case.
Loss of privilege when client or lawyer uses employer’s email system.
In In re Information Management Services Derivative Litigation, 81 A.3d 278 (Del. Ch. 2013). the Delaware Court of Chancery ruled that email communications between officials of the closely held company and their personal attorneys using the company’s email system were not subject to the attorney-client privilege because the officials did not have a reasonable expectation of privacy. The ABA Ethics Committee has previously advised that lawyers who represent employees should warn them that use of company email systems for communication with their lawyers runs the risk of loss of the attorney-client privilege. See ABA Formal Opinion #11-459.
Most attorney-privilege waiver cases involving use of employer email systems deal with emails initiated by the client, but waiver can also occur in the reverse case. In United States v. Finazzo, 2013 WL 619572 (E.D.N.Y., Feb. 19, 2013), the court held that an attorney waives privilege when he or she sends an email to a client at the client’s work email address. The ethical and professional liability implications in an age in which counsel communicate with clients on email with some regularity are significant.
Bidding on the name of a competitor firm to obtain a sponsored link above the competitor in a Google search does not violate Wisconsin’s privacy law. Under Wisconsin law use of a person’s name for advertising purposes without the person’s consent violates the right of privacy. In Rottier v. Cannon, 828 N.W.2d 876 (WI Ct. App. 2013), rev. denied, 839 N.W.2d 616 (2013), the defendant law firm purchased the names of the plaintiffs from Google, Yahoo!, and Bing. Whenever a searcher entered the names of the plaintiffs, the defendant’s sponsored link would appear above the plaintiffs’ organic link in the search results. The plaintiffs sued claiming that the defendants conduct violated Wisconsin privacy law. The state court of appeals held for the defendants. It found that the defendants’ purchase of the plaintiffs’ names for internet search purposes did not amount to public use of their names. The court analogized the situation to one in which a business moves its operation near to that of a competitor in order to obtain some of the competitor’s traffic. The court did not decide whether the defendant’s conduct violated federal trademark law because it found the argument to be “insufficiently developed.”
ABA Ethics Committee cautions lawyers about use of Deal-of-Day marketing programs.
In Opinion 465 issued October 21, 2013, the Committee analyzed two types of programs: coupon and prepaid. In a coupon program, the purchaser buys a voucher entitling the purchaser to a discount on legal fees. In the prepaid plan, the purchaser pays a lump sum for a described legal service or specified number of hours. The Committee concluded that coupon plans could probably be structured to comply with the Rules of Professional Conduct. On the other hand, prepaid plans, while not per se unethical, posed problems with regard to handling and refund of legal fees.
New Hampshire opinion advises lawyers on use of social media to contact witnesses in the course of litigation. In Opinion 2012-13/05 the New Hampshire Ethics Advisory Committee dealt with a number of issues connected with contacts with witnesses in the course of litigation. The committee began its analysis with the lawyer’s duty of competency: “counsel has a general duty to be aware of social media as a source of potentially useful information in litigation, to be competent to obtain that information directly or through an agent, and to know how to make effective use of that information in litigation.” Based on this duty of competency, the committee advised that lawyers could seek to obtain publicly available information from a witness’s or party’s social media account. The duty of competency, however, is subject to a number of ethical restrictions. In seeking social media information an attorney may not engage in deceitful conduct in violation of Rules 4.1 and 8.4. This means that an attorney may not use a false name or other false identifying information to obtain access to a witness’s restricted social media information. The committee advised that it was not sufficient for a lawyer to use only the lawyer’s name when making a friend request because that form of request contained an implied representation that the lawyer was disinterested. While committees in Pennsylvania and San Diego agree with this position, the New York City Bar has taken a contrary view. If a witness is represented by counsel in connection with a matter, the lawyer may not communicate with the witness either through social media or any other form without the consent of the witness’s counsel. Lawyers may not use third persons, such as investigators, to acquire social media information in ways that the lawyer could not do. However, a lawyer may ethically advise a client of the client’s right to obtain such information. In addition, if a third person, not acting at the direction of the lawyer, acquires a witness’s restricted social media information and provides the information to the lawyer, the lawyer may ethically use the information.
Lawyers may use text messaging to contact potential clients but with so many limitations that the method may not be practically useful. The Ohio Disciplinary Board has advised that lawyers may use text messaging to contact potential clients. In addition, the Board decided that text messaging generally did not amount to “real-time electronic contact” in violation of Rule 7.2 dealing with solicitation, distinguishing text messaging from contact in chat rooms. Ohio Opinion #2013-2. However, the committee also advised that text messages must comply with all of the requirements governing advertising, including identification of the name and address of the responsible lawyer, statement that the message constitutes “Advertising Material,” and provision of other disclosures required by the Ohio Rules. The committee also discussed a number of other restrictions that would apply to the use of text messages. The limitations in the opinion are so burdensome that most lawyers will probably find text messaging to be an impractical and risky means of trying to acquire clients.
Virginia ethics opinion approves use of virtual offices and executive suites but cautions lawyers on complying with their ethical obligations. In recent years an increasing number of lawyers engage in the practice of law through virtual offices that provide a mailing address and phone number without a physical presence by the lawyer. Virtual offices are often combined with executive suite rentals in which the lawyer rents access to a shared office suite. Executive rentals have a variety of levels of service including separate offices, copying and fax, staff availability for designated prices, etc. In Opinion 1872, the Virginia Ethics Committee advised that lawyers may ethically operate their practice through virtual offices and executive suites. The committee discussed various rules that are applicable to law offices generally and virtual office/executive suites in particular. In the context of virtual offices/executive suites, compliance with these duties may require a higher level of precaution than applicable to law firms generally. The committee pointed out that reference to a virtual office/executive suite as the lawyer’s law office could be misleading if the lawyer did not actually provide legal services from that location.
Other materials of note
Use of a database to acquire information about a potential client’s payment history is ethically permissible provided the client gives informed written consent. Texas Opinion, #622.
Small Law Firm Committee of the New York City Bar issues report on Cloud Computing giving guidance to lawyers with regard to their due diligence obligations. Browser > “New York City Bar” + “cloud computing.”
For more information contact Nathan M. Crystal