Lawyers May Impose Conditions on File Destruction

• Author: Martha L. Kohlstrand
• Pages: 6-6

Published in Litigation News Volume 45, Number 3, Spring 20 20. © 2020 by the Ameri can Bar Association. Re produced with per mission. All rights re served. This info rmation or any porti on thereof may not be c opied or disseminated in any

form or by any means or sto red in an electronic da tabase or retrieval sy stem without the ex press writt en consent of the Amer ican Bar Associatio n.

6 | S ECTION OF LITIGATION

ETHICS STRU GGLES IN THE LEGAL WORLD

lthough a client a lways has

the right to have copies of

its documents destroyed

at the end of represe nta-

tion, an attorn ey may

have an equal interes t in maintaining a

copy. In Ethics Opinion 1 164, the New

York State Bar Associatio n ruled that

lawyers may conditi on destroying

client f‌iles on the r eceipt of specif‌ic

reasonable protections against future

lawsuits, including indemnif‌ication.

The attorney who so ught guidance

from the bar asso ciation had previous-

ly represented a cli ent in an intellectual

property m atter and had obtained digi -

tal data relating to th e matter. After the

attorney-clien t relationship had begun ,

the client decid ed to obtain dierent

representatio n and ended the relation-

ship with the f‌irst at torney. The f‌irst at-

torney returned the d ata to the former

client, but mai ntained backup copies .

Subsequentl y, the former clie nt set-

tled the matter in a co nf‌idential agree-

ment that require d the former client

to destroy all data relate d to the dis-

pute. Although th e f‌irst attorney was

not a party to the a greement, the for-

mer client requ ested that the attorney

destroy the data in qu estion and cer-

tify as to its destr uction. The attorney

was concerned , however, that the in-

formation might b e necessary if either

the former clie nt or the adverse party

in the original laws uit brought a lawsuit

against the attorney. Therefore, the at-

torney sought the ba r association’s

guidance on whe ther it was permissi-

ble to condition f‌ile d estruction on a

release and ind emnity from each part y

to the settlement a greement, and to

keep an index of the f‌il es.

Before addressing these ques-

tions, the bar association discussed

Rule 1.15(c)(4) of the New York Rules

of Professional Conduct, which states

that a lawyer shall “ promptly . . . deliv-

er to the client . . . as req uested by the

client . . . proper ties in possession of

the lawyer that the cli ent . . . is entitled

Lawyers May Impose Conditions on

File Destruction

to receive.” The assoc iation further

noted that Rule 1.1 6(e) provides that

“upon termination of representation,

a lawyer shall take s teps, to the extent

reasonably pra cticable, to avoid fore-

seeable preju dice to the rights of the

client,” including “delivering to the cli-

ent all papers a nd property to which

the client is entitle d.” But, the associa-

tion observed , the rules do not specify

which papers a nd property the client

must receive.

Beyond referenci ng the rules, the

bar associatio n also cited its own Ethics

Opinion 780, i n which it addressed

whether an attor ney could retain a copy

of documents over a c lient’s objection.

There the assoc iation concluded that

this was generally acceptable because,

under Rule 1 .6(c)(5)(i), a lawyer may re-

veal or use client con f‌idential informa-

tion if the lawyer reas onably believes

doing so is neces sary to defend against

a wrongful cond uct accusation. A re-

lease from the cli ent was also an ac-

ceptable way to protect o neself.

In this particu lar case, the associa-

tion advised that th e lawyer could re-

quest a release f rom the former client

in exchange for the do cument destruc-

tion. However, the associa tion cau-

tioned that a pre-destruction release

and indemnit y from the non-client ad -

verse party wo uld not be enforceable.

Regarding the fo rmer client, the asso-

ciation reasone d that the client had a

strong claim to the do cuments and, be-

cause it was an intel lectual property

dispute, they were certainly sensitive.

The settleme nt agreement was a legit-

imate basis for des truction. Because

the document s were stored electroni-

cally, they would not be di cult to de-

stroy. And the bar associ ation could

see no increase d risk of liability asso-

ciated with the lawyer ’s document de-

struction. T he bar association opined

that the lawyer sho uld be permitted to

keep an inventory of th e documents,

however, providing additional protec-

tions against a f uture lawsuit.

By Martha L. Kohls trand, Litigation N ews Associate Editor

“This is a very un usual case, but

the New York Bar Associ ation’s opin-

ion makes perfect sense,” says John

M. Barkett, M iami, FL, cochair of the

ABA Section of Liti gation’s Ethics &

Professionalism Committee. “Given the

balancing test l aid out by the bar asso-

ciation, it’s a rea sonable result,” agrees

Paula M. Bag ger, Boston, MA, cochair of

the Ethics Subco mmittee of the Section

of Litigation’s Commercial & Business

Litigation Commi ttee. “The detailed in -

ventory is a commo nsense solution.”

“Your engagement letter should

cover your best prac tices for keeping

and destroying do cuments at the end

of an engagem ent,” Barkett recom-

mends. “Or i f your engagement letter

doesn’t add ress this, include it in your

closing letter,” he contin ues. Bagger

has similar adv ice. “As part of your dis-

engagemen t letter, spell out what your

practices are for d ocument destruc-

tion,” she couns els. “However,” she

warns, “make su re to check your state

rules on retention a nd destruction.

They are always changi ng—for exam-

ple, my state, Massachusetts, has just

added Rule 1:15 (a), a very drilled-d own

scheme on docu ment retention and

destruction.”

Barkett also ha s some words of cau-

tion on this topic for th e electronic age.

“Nowadays, ma ny of us do not even

know where all of our c lient documents

and data reside ,” he observes. “The

documents m ay be stored on a server,

within removable m edia, or in Outlook

folders. An a ssistant who left your f‌irm

may have put it on a thumb dri ve, and

you don’t know whe re that drive is. You

may have sent somethin g to your per-

sonal email to review at h ome. This

opinion prompts some important ques-

tions about dat a retention practices.”

Digital versio ns of all Ethics stories,

including link s to resources and

authorities, a re available at http://bit.ly/

LN-ethics.