Risk Update

Risk Reading Roundup — Client Identification Clarity, “Mercenary” Litigation Hacking, Supreme Ethical Wall, Crowdsourced Litigation Fees Ethics Opinion

A Deeper Dive — Who Is the Client? The Ethics Rule Implications for In-House Counsel and Outside Counsel” —

  • “Shannon “A.J.” Singleton and Alicia Still delve into the ethical requirements for in-house counsel and outside counsel, extending the discussion of a Showcase CLE program at the ABA Business Law Section’s 2022 Hybrid Spring Meeting.”
  • “Their conversation hits on the in-house implications of ABA Model Rule of Professional Conduct 4.2, what it takes to forge relationships with colleagues on the business side and why it matters, and more.”

This is a 25 minute video discussion. The actual 90 minutes CLE presentation is accessible for ABA members. That: “…presentation explores the unique application of the Rules of Professional Conduct and other ethical requirements to the role of in-house lawyers, including client identity, conflicts, confidentiality and privilege, and business and interpersonal relations with clients. The content will also be useful to outside counsel working with in-house lawyers.”

Goodwin Walls Off Jackson’s Brother-in-Law From High Court Cases” —

  • “Justice Ketanji Brown Jackson’s brother-in-law will not receive income from his law firm Goodwin Procter’s work on cases in the US Supreme Court, the firm told the court Thursday.”
  • “William Jackson is a partner in Goodwin’s Washington office, where he focuses on health care and life sciences litigation. He does not handle Supreme Court cases, the firm said in a letter to the high court’s clerk.”
  • “Other firms have similarly opted to wall off partners with family ties to the court to avoid conflicts of interest. Goodwin’s move comes amid rising calls for the court to tighten ethics restrictions following revelations that Justice Clarence Thomas’ wife, Virginia ‘Ginni’ Thomas, was involved in a pressure campaign to overturn the 2020 election.”

One good item and one bad item for your Friday” —

  • “…the New Hampshire Bar Association has published a pretty good ethics opinion to provide guidance to lawyers that find themselves representing clients who end up seeking out crowdsourcing to help pay their legal fees in connection with matters.”
  • “…the guidance on having to be wary about (and make sure you fully counsel your client about) providing any sort of informational updates to those who provide funds whether as a “perk” or “reward” for participation or otherwise and the reminder that funds raised explicitly for the purpose of paying for legal fees and legal expenses cannot then be used to provide the client with financial assistance for living expenses if the lawyer essentially appears to be the one raising the funds or so involved in the effort to raise the funds publicly because of the prohibition in RPC 1.8(e) on lawyers offering that kind of financial assistance.”
  • “The opinion does not take the next step though of offering the relatively obvious practical advice that the most flexible way to crowdsource would always be to seek funds for a client to allow them to financially survive their circumstances without promising that all or even any of the funds would go to attorney fees. Once raised and available to the client, the client could then use them for whatever purpose they wish, including paying their lawyer.”

How mercenary hackers sway litigation battles” —

  • “A trove of thousands of email records uncovered by Reuters reveals Indian cyber mercenaries hacking parties involved in lawsuits around the world – showing how hired spies have become the secret weapon of litigants seeking an edge.”
  • “For Gupta it was just the beginning. Over the next decade, he and a small coterie of Indian colleagues built an underground hacking operation that would become a hub for private investigators, like Moser, who sought an advantage for clients embroiled in lawsuits.”
  • “Reuters identified 35 legal cases since 2013 in which Indian hackers attempted to obtain documents from one side or another of a courtroom battle by sending them password-stealing emails.”
  • “The messages were often camouflaged as innocuous communications from clients, colleagues, friends or family. They were aimed at giving the hackers access to targets’ inboxes and, ultimately, private or attorney-client privileged information.”
  • “At least 75 U.S. and European companies, three dozen advocacy and media groups and numerous Western business executives were the subjects of these hacking attempts, Reuters found.”
  • “The targets’ lawyers were often hit, too. The Indian hackers tried to break into the inboxes of some 1,000 attorneys at 108 different law firms, Reuters found.”
  • “Among the law firms targeted were global practices, including U.S.-based Baker McKenzie, Cooley and Cleary Gottlieb. Major European firms, including London’s Clyde & Co. and Geneva-based arbitration specialist LALIVE, were also hit. In 2018, the Indian hackers tried to compromise more than 80 different inboxes at Paris-based Bredin Prat alone.”
  • “One of the most prominent was WeWork co-founder Adam Neumann, who hired New York’s Seiden Law Group after learning from Reuters that he and other company executives’ email accounts were targeted by the Indian hackers starting in August 2017, according to four people familiar with the matter.”
  • “Indian mercenary hackers have worked in the shadows for at least a decade, helping private detectives get an edge in litigation, a Reuters investigation found. Now one victim – an aviation executive named Farhad Azima – is exposing the secretive industry, with potential ripple effects for legal battles on both sides of the Atlantic… ‘Millions of dollars are being made by hackers, investigators and their instructing law firms from these illegal activities,’ he said. ‘The hack-for-hire companies may be thousands of miles away, but the victims are often U.S. citizens on U.S. soil.'”

Other examples and more detail for the curious or concerned: “Dark Basin: Uncovering a Massive Hack-For-Hire Operation” —

  • “Dark Basin is a hack-for-hire group that has targeted thousands of individuals and hundreds of institutions on six continents. Targets include advocacy groups and journalists, elected and senior government officials, hedge funds, and multiple industries.”
  • “Dark Basin extensively targeted American nonprofits, including organisations working on a campaign called #ExxonKnew, which asserted that ExxonMobil hid information about climate change for decades.”
  • “Several international banks and investment firms, as well as prominent corporate law firms in the United States, Asia, and Europe, were targets. We also found a number of companies involved in offshore banking and finance were also targeted.”
  • “We found targeted individuals in many major US and global law firms. Lawyers working on corporate litigation and financial services were disproportionately represented, with targets in many countries including the US, UK, Israel, France, Belgium, Norway, Switzerland, Iceland, Kenya, and Nigeria.”
  • “Dark Basin’s activities make it clear that there is a large and likely growing hack-for-hire industry. Hack-for-hire groups enable companies to outsource activities like those described in this report, which muddies the waters and can hamper legal investigations. Previous court cases indicate that similar operations to BellTroX have contracted through a murky set of contractual, payment, and information sharing layers that may include law firms and private investigators and which allow clients a degree of deniability and distance.”