Legal Cloud Computing Association Responds to ABA and North Carolina State Bar

If you’re a lawyer thinking about using cloud computing for your law firm practice, the good news is that the ABA, Alabama, California, and other states have issued ethics opinions (or proposals) on the subject giving you a thumbs up, provided you know who you’re dealing with.

However, the news on this front from North Carolina is not so good.

Legal Productivity’s sponsor company, Rocket Matter, is a founding member of the Legal Cloud Computing Association, or LCCA. We advocate and educate on behalf of the online software providers servicing attorneys.

For the most part, we’re seeing flexible ethics opinions allowing the use of web-based legal software, as long as attorneys exercise due diligence about the provider. In fact, the ABA’s recent proposal to modify the rules of professional conduct illuminate a clear and sensible path for attorneys to incorporate cloud computing into their practice while minimizing risk to confidentiality. The LCCA fully supports the ABA’s approach and their efforts.

North Carolina’s bar is another story. We appreciate their hard work and desire to help attorneys work with online legal vendors, but their proposed FEO would be burdensome, especially for small firms. It would require attorneys to review security audits of the software provider, or hire a security professional to do it for them, undertake a financial investigation of the SaaS (Software as a Service) vendor, and engage in other mandatory activity.

They would also require vendors like Rocket Matter to provide “a separate agreement that states that the employees at the vendor’s data center are agents of the law firm and have a fiduciary responsibility to protect confidential client information and client property.”

As the LCCA writes in its response to North Carolina, these policies will ultimately harm legal consumers:

The idea that a major data center, of the kind used by many cloud computing vendors, would enter into an agreement that would make its employees agents of a law firm is not realistic. There is not sufficient consideration to expose the Data Center to this kind of liability, and there is no way data center providers would modify their terms and conditions to meet the needs of a single SaaS legal vendor. We have serious doubts that counsel for the Data Center would ever approve such language. Amending the contract terms just for SaaS vendors that service the legal industry is not likely to happen.

Larger companies, such as Google or Microsoft, are not going to negotiate with North Carolina lawyers on this point. Small companies will simply pull out of the North Carolina market altogether.

We want consumers to be informed and protected when it comes to legal cloud computing. But we also want them to have a choice. Our full press release on our recent responses to the ABA and NC can be found here.