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Attorneys are free to ditch most hard copies of client records and archive them in cyberspace, as long as adequate measures to protect confidentiality are taken, says the Supreme Court Advisory Committee on Professional Ethics. “Nothing in the RPCs prevents a lawyer from archiving a client’s file through use of an electronic medium such as PDF files or similar files,” the panel wrote in Opinion 701, published on Monday. Lawyers would still have to retain originals of some items, such as wills, deeds and executed contracts that constitute “property of the client” under Rule of Professional Conduct 1.15, but they would be free to clear file cabinets of paper copies of pleadings, memoranda and briefs, the committee said. The ethics inquiry was prompted by the ease and lower cost of storing documents in digitized form. Attorneys are required by rule to retain files for at least seven years, making computer archiving an attractive option. The archiving question was an easy one for the committee. It described the conversion of data into an electronic format as a positive development that enables lawyers to represent and communicate with clients more effectively. But the ability to access such files remotely also raises the issue of preserving client confidentiality in cyberspace from hackers and other intruders, and most of Opinion 701 is devoted to that topic. Lawyers need to take “reasonable affirmative steps to guard against the risk of inadvertent disclosure” to third parties, said the committee. They do not have to ensure that information is “utterly invulnerable,” because that is impossible. “A lawyer can no more guarantee against unauthorized access to electronic information than he can guarantee that a burglar will not break into his file room, or that someone will not illegally intercept his e-mail or steal a fax.” The committee leaves it to lawyers’ “sound professional judgment” to guard against “foreseeable attempts at unauthorized access” in light of the available data security technology. However, the committee was notably short on specifics on how attorneys should prevent disclosure. It said that technology evolves so rapidly that any particular safety measure could soon be obsolete. The panel did say that confidential documents sent by e-mail should be password-protected. In addition, the committee expressed concern over the use of outside Internet Service Providers for e-mail or storage of sensitive data on large servers shared with other clients of the ISP. The committee did not want to prohibit use of outside ISPs because that would disadvantage smaller firms who cannot afford their own information technology staff. Instead, lawyers must inform the ISP of the need to safeguard the data, use available technology to “guard against reasonably foreseeable attempts to infiltrate the data” and ensure there is “an enforceable obligation” to preserve confidentiality and security. It is not a new issue for law firms. They already are grappling with the problem of Internet security, thanks to e-mail and electronic filing. The federal district and bankruptcy courts of New Jersey require e-filing, and state courts are moving in that direction. Additional concerns are raised by the growth of remote access to law firms’ digital databases, as more and more firms allow lawyers and clients to log in from outside. A small but growing number of firms provide clients with extranet access, which allows them to look at their own case files and, in some cases, their bills. A survey of the country’s top 200 law firms published last Oct. 31 in the American Lawyer magazine, an affiliate of the Law Journal, found that 76 of 138 firms that responded have extranets. Many of New Jersey’s biggest firms have them, including McCarter & English in Newark, Lowenstein Sandler in Roseland, Pitney Hardin in Florham Park, McElroy, Deutsch, Mulvaney & Carpenter in Morristown and Gibbons Del Deo Dolan Griffinger & Vecchione in Newark, as well as other firms like Hoagland Longo Moran Dunst & Doukas in New Brunswick and Entwistle & Cappucci of Florham Park and New York. Such access isn’t just a nice touch, it’s imperative with complex litigation, says William Gyves, of the Entwistle firm, which does securities litigation. “From the attorney’s perspective, there isn’t a litigation bag big enough in the world to carry even the documents in your typical case,” he says. “It’s always the documents that you need at a critical juncture that you haven’t packed.” Clients are increasingly demanding remote access as well, says legal technology consultant Ron Friedmann of Arlington, Va.-based Prism Legal Consulting. Gibbons Del Deo, which has provided remote access for its attorneys since the dial-up days of the 1990s and added the extranet option about five years ago, has seen client interest expand from about five users to nearly 50 at present, says Lois Horwitz, the firm’s chief information officer. The firm has internal servers for some purposes but uses an outside server for the extranets. The server contract contains a security obligation and the company, AMS, has spelled out its security measures, says Horwitz. When a case is over, extranet access is shut down and paper and digital files are archived, she says. The firm’s chief knowledge officer, attorney Patrick DiDomenico, says lawyers need special software on their home computers to access the firm’s database. The internal security controls can be set in different ways depending on the sensitivity of a case or document and can exclude lawyers who must be screened off for ethics reasons. ‘It’s nowhere as open as the old file room,” says Joseph Cusumano, Gibbons Del Deo’s litigation support director. Greg Deatz, Hoagland Longo’s director of operations and technology, says his firm has two backup servers at a secure location in Secaucus. The servers are enclosed in metal cages, and entry to the facility requires 24 hours’ notice and use of a palm scanner. Written agreements with the facility cover security obligations, he says. The firm’s designated ethics partner, Ted Hubert, says the firm is meeting the standard of Opinion 701 though an array of protections, including firewalls, passwords, anti-spyware software and, in appropriate circumstances, data encryption. Current technology includes devices small enough to carry on a keychain that can be synchronized with a firm’s servers and provide passwords necessary for remote access that change every 60 seconds, according to Friedmann. Another safety mechanism is the monitoring of extranet use, says Gyves. Monitoring can reveal unauthorized use and lets lawyers know which clients are not using the capability so the lawyers can address any concerns clients might have. Archiving should also be viewed from a risk management perspective, Hubert points out. The six-year statute of limitations for legal malpractice starts to run only when a client discovers the malpractice, meaning lawyers remain exposed to claims for longer than the seven-year file retention period. Digitization makes it easier to hold onto those files for longer, he says. Patrick Stanton, of Morristown’s Ogletree, Deakins, Nash, Smoak & Stewart, says his firm has just gone to a firmwide document management system. The firm has remote access for lawyers and client extranets, though Stanton prefers to take files with him by loading them onto a memory stick. He recalls instances when an e-mailed document “saved the day,” allowing him to respond to client concerns that arose while he was traveling. Stanton welcomes Opinion 701 because it should enable him to get rid of paper that has been accumulating through the years. His firm has been storing paper files offsite and it can take a day to get hold of something that turns out to be needed. “We’re all running out of space,” remarks Stanton. “It’s a very expensive use of office space to store files.”

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