July 31, 2013
Departing Partners and Client Files Part II: Transferring Client Files in the Digital Era
Not long ago client files consisted only of hard-copy documents in physical file folders and typically contained filed briefs, discovery, transcripts, correspondence and memoranda of law. While there was a split in authority on whether attorney notes and drafts should be included as part of a client’s file, the California Rules of Professional Conduct states that essentially all substantive documents pertaining to the client and his or her case belong to the client. (California Rules of Professional Conduct, Rule 3-700(D).) Thus, if a client chose to follow a departing partner, the firm was required to transfer the client’s hard-copy files to the departing partner so that the client could continue to receive adequate representation.
With the advent of computers and the digitalization of data, it has become both easier and more difficult for lawyers and law firms to manage and transfer client files. On one hand, digital files are portable and can be inexpensively transferred through compact discs or cloud-storage services. On the other hand, the variety of available storage formats, software and operating systems complicate the process of transferring client files to a departing partner. Therefore, any partner considering a lateral move should familiarize himself or herself to changes in technology to maintain a standard of care to his or her clients upon departure.
At a minimum, any partner that is planning on departing a firm should take measures to ensure that his or her client’s files are both secure and organized. The digitalization of client files puts confidential information at risk when files are not backed up, when there is a potential breach of firewall, or even when an irrevocable e-mail is sent to an incorrect party. Since documents are often times embedded with metadata – data about data – that can reveal potentially privileged information, such as previous drafts of a document, lawyers and law firms must be wary of what exactly they are transmitting online or electronically. For example, prior to releasing a client’s file, “the attorney is ethically obligated to take reasonable steps to strip from each of these electronic items any metadata reflecting confidential information belonging to any other client.” (State Bar of California, Committee on Professional Responsibility and Conduct, Formal Op. No. 2007-174; California Business and Professions Code Section 6068(e)(1).) There is also the potential to inadvertently release attorney work product and/or the firm’s intellectual property, along with the client file, if the transfer is not handled properly.
To prepare client files for transfer, it is also important for lawyers and law firms to organize files in a consistent manner. Because electronic documents can be saved in a variety of formats (.pdf versus .doc) and operating systems (.doc versus .docx), as well as in different locations (e-mail versus hard drive versus cloud service), attorneys who are planning a departure should compile their client files in a manner that is readily accessible and useable to the client.
Neither California Courts nor the State Bar of California have yet to issue definitive guidelines explaining exactly what it means to exercise reasonable care over client files from a technological perspective. Still, any partner that is planning a departure should stay abreast of these issues and/or consult with someone who specializes in these matters to avoid any adverse consequences, or potential litigation, arising out of the treatment of client files.
(Editor’s note: Jennifer Lien, a summer law clerk in the Firm’s San Francisco office, contributed to this article.)