cloud technology & law firms

Legaltech Toronto Conference Metro Toronto Convention Centre | Toronto, ON

September 24 - 25, 2015

CLOUD TECHNOLOGY & LAW FIRMS WHAT’S THE BUSINESS REASON FOR GOING TO THE CLOUD?

2

Prepared for

Legaltech Toronto Conference Metro Toronto Convention Centre | Toronto, ON

September 24 - 25, 2015

3

Prepared by

SkyLaw is a boutique corporate and securities law firm offering sophisticated legal and strategic advice

to public and private companies.

www.skylaw.ca

•  Kevin West is the founder of SkyLaw, an innovative boutique corporate and securities law firm in Toronto.

•  After clerking for Justice Binnie at the Supreme Court of Canada, Kevin practiced with Sullivan & Cromwell in New York and Australia and was a partner at Davies in Toronto.

•  Kevin obtained his LLB from Dalhousie University in 1998.

4

Presented by

Kevin R. West Founder, SkyLaw Professional Corporation

5

Kevin R. West

Timeline

•  Acquisition of Corriente Resources Inc. by Tongling Nonferrous Metals Group Holdings Co. Ltd and China Railway Construction Corporation Limited for $679 million.

•  Acquisition of Northern Peru Copper Corp. by China Minmetals Nonferrous Co. Inc. and Jiangxi Copper Company for $455 million.

•  Xstrata plc hostile take-over of Falconbridge Limited for $24 billion. •  Acquisition of PetroKazakhstan Inc. by China National Petroleum

Corporation for $4.2 billion. •  Royal Bank of Canada’s acquisition of Centura Banks, Inc. for $2.3 billion.

6

Kevin R. West

Selected Transactions List

7

TOPICS

I.  What is Cloud Technology?

II.  The Perception of the Cloud in the Legal Profession

III.  Risk vs. Reward in Using the Cloud

IV.  Legal Concerns

V.  Perspectives of Law Societies

VI.  How to Work the Cloud into the Firm Structure

VII.  Case Study: Closing Folders Inc.

Image Credit: ITS Sheffield <www.its-‐sheffield.com/service>

•  The cloud is a powerful tool for today’s law practice •  Consider the nature of your practice and your

clients to determine the best solution for your firm •  Choose reputable service providers •  Always consider your professional obligation to

maintain client confidentiality •  Change passwords frequently •  Ensure all information is securely backed up off site

KEY POINTS

8

9

WHAT IS CLOUD TECHNOLOGY?

10

-‐

Image Credit: Fletcher, David. CloudTweaks.com. <www.cloudtweaks.com/2012/10/the-‐lighter-‐side-‐of-‐the-‐cloud-‐obscurity>

I. What is Cloud Technology?

WHAT IS CLOUD TECHNOLOGY? (cont.)

•  Cloud Technology is the practice of using a network of remote servers hosted on the internet to store, manage and process data

•  Access to data and applications occurs online rather than through a local device Examples: �  Email services like Gmail and Outlook.com �  Data services like iCloud and ShareFile

11


•  SaaS is software that is accessed through websites rather than directly through computers Examples: �  Online office services like Microsoft Office 365

and Google Docs �  Online creative suites like Adobe Creative Cloud

12

WHAT IS SOFTWARE AS A SERVICE (SaaS)?


HOW IS THE CLOUD ACCESSED?

13 Image Credit: RaO-‐report.com <raO-‐report.com/region-‐global/cloud-‐compuRng-‐companies-‐the-‐next-‐new-‐business-‐fronRer/aTachment/new-‐business-‐cloud-‐compuRng-‐diagram-‐small>


HOW DOES THE CLOUD WORK?

14

•  A cloud service provider stores information on its own physical server

•  Consumers access the server through online websites or applications as needed

•  It functions much like an electricity grid

Image Credit: Cubeelite.com <www.fingertecblog.com/2013/12/cloud-‐compuRng-‐myths-‐oh-‐please.html>


15

THE PERCEPTION OF THE CLOUD IN THE LEGAL PROFESSION

THE CLOUD AND THE LEGAL PROFESSION

16

II. The Perception of the Cloud in the Legal Profession

•  "Lawyers have an obligaRon to make their services

efficient, convenient and cost-‐effecRve from the point of view of our clients. This is an ongoing obligaRon which requires lawyers to constantly re-‐assess if we are complying with these two rules in the way we manage our pracRces. So it should come as no surprise that efficiency, convenience and cost-‐effecRveness are at the heart of all the innovaRons that we are beginning to see sprout up across the legal landscape, including the move to the Cloud and the creaRon of virtual law firms.”

Mitch Kowlaski, Some Ethical Considera2ons for Lawyers Using the Cloud

THE CLOUD AND THE LEGAL PROFESSION (cont.)

17

II. The Perception of the Cloud in the Legal Profession

•  "Technology has become an important part of contemporary legal pracRce. Lawyers should be able to recognize when using technology is needed to provide a legal service effecRvely and understand how to use technology responsibly and ethically.”

Canadian Bar AssociaRon, Legal Ethics in a Digital World Image Credit: www.techRpsforlawyers.com <hTp://www.techRpsforlawyers.com/blog2/pracRcing-‐law-‐in-‐the-‐cloud>

18

RISK VS. REWARD IN USING THE CLOUD

ADVANTAGES OF USING THE CLOUD

•  Decreased Costs •  Accessibility •  Collaborative Platforms •  All-in-one Practice Management Services •  Email Archiving •  Disaster Recovery Services •  Saves Paper & Space

III. Risk vs. Reward in Using the Cloud

✓ 19

ADVANTAGE:

DECREASED COSTS •  Used only on an ‘as needed’ basis •  No upfront outlays •  No ongoing maintenance or upgrades •  IT services are often included •  No extra cost for use from multiple computers •  Many services are free

20


ADVANTAGE:

ACCESSIBILITY •  Access from almost anywhere on almost any

computer or device •  24/7 services •  Accessible by multiple people

21


ADVANTAGE:

COLLABORATIVE PLATFORMS

•  Easily share documents, data and services •  Allow colleagues, clients and other parties to work

on the same project in a functional manner •  Only one version of the document exists even with

multiple contributors Examples:

� Microsoft Office 365 (SharePoint)

22


ADVANTAGE:

ALL-IN-ONE PRACTICE MANAGEMENT SERVICES

•  Reduce redundancy •  Work more efficiently •  Create consistency

23


ADVANTAGE:

EMAIL ARCHIVING

•  Store and locate data and communications quickly and easily

•  Central repository •  Synchronization •  Automatic filtering, filing and organizing •  Access from almost any computer or browser

24


ADVANTAGE:

DISASTER RECOVERY SERVICES

•  Significantly faster recovery times •  Cost effective recovery •  Disaster recovery is often

included as a free service

25


ADVANTAGE:

SAVES PAPER & SPACE

•  An effective virtual filing system •  Maintain the physical records of executed originals

and material correspondence only •  Hard copies of documents can be produced on an

as needed basis •  Virtual data rooms give instant access without the

cost of printing

26


DISADVANTAGES OF USING THE CLOUD

•  Risk of Technical Failures

•  Loss of Control

•  Lack of Transparency

•  Privacy & Security Risks


27

DISADVANTAGE:

RISKS OF TECHNICAL FAILURES

•  Access failures �  Telecommunications connection �  Cloud server �  General computer malfunction

•  Data loss and corruption

28


DISADVANTAGE:

LOSS OF CONTROL Big picture concerns about loss of control:

•  “Cloud computing is the style of computing in which the users can rent infrastructure, platform or software services from other vendors without requiring the physical access to them. It divides the responsibilities of managing technologies between two different stakeholders who can be geographically situated in different corners of the world.”

29

Karthick Ramachandran, Thomas Margoni, Mark Perry, “Clarifying Privacy in the Clouds”, CYBERLAWS 2011: The Second InternaRonal Conference on Technical and Legal Aspects of the e-‐Society, p. 3& 4, IARIA, 2011


DISADVANTAGE:

LOSS OF CONTROL (cont.) •  “The cloud computing paradigm requires

disturbing levels of trust by users in the servers that hold their information. Unless there is some means of totally obfuscating the data, the user needs to trust that the data stored by the CSP will be used by them only for the purposes for which it is intended to be used.”

30

Karthick Ramachandran, Thomas Margoni, Mark Perry, “Clarifying Privacy in the Clouds”, CYBERLAWS 2011: The Second InternaRonal Conference on Technical and Legal Aspects of the e-‐Society, p. 3& 4, IARIA, 2011


DISADVANTAGE:

LACK OF TRANSPARENCY •  Lack of transparency with respect to cloud service

provider processes, procedures and practices, including whether or not cloud service providers sub-contract any of the processing

•  Lack of transparency makes it difficult to conduct a proper risk assessment and to enforce rules (regarding privacy, RIM, etc.)

31


DISADVANTAGE:

LACK OF TRANSPARENCY (cont.) •  Cost drivers

�  Cloud customers are under great pressure to reduce costs

�  Cloud service providers are under great pressure to capitalize investment costs

�  To keep prices low, cloud service providers are more likely to offer standard terms

32


DISADVANTAGE:

PRIVACY & SECURITY RISKS

33

•  Breaches of cloud service provider security •  Internet connection breaches

�  Denial of service attacks �  Eavesdropping �  DNS spoofing


34

LEGAL CONCERNS

KEY LEGAL CONCERNS

•  Privacy Compliance in the Cloud

•  Security Breaches in the Cloud

IV. Legal Concerns

Image Credit: www.ecominfotech.biz/images/cloud-‐7.jpg 35

PRIVACY COMPLIANCE IN THE CLOUD

36

IV. Legal Concerns

Image Credit: hTp://mscorp.blob.core.windows.net/mscorpmedia/2014/05/ProtecRng-‐Data-‐and-‐Privacy-‐in-‐the-‐Cloud.jpg

Do you know where your personal information is?

PRIVACY COMPLIANCE IN THE CLOUD (cont.)

37

•  Key privacy obligations at risk in the cloud �  Consent �  Retention �  Accuracy �  Individual Access �  Safeguard [Security] �  Notification �  Jurisdiction (Legislation / guidelines prohibiting extra-provincial

transfer and triggering obligations in multiple jurisdictions)

IV. Legal Concerns

PRIVACY COMPLIANCE IN THE CLOUD (cont.)

38

IV. Legal Concerns

The Canada.com case:

“Assistant Commissioner emphasizes the importance of organizations assessing the risks that could jeopardize the security and confidentiality of customer personal information when it is transferred to foreign-based third-party service providers. It is essential that organizations using third-party service providers outside Canada use contractual or other means to provide a comparable level of protection while the information is being processed by the third party.”

[Findings under the Personal Information Protection and Electronic Documents Act (PIPEDA), PIPEDA Case Summary #2008-394, available at http://www.priv.gc.ca/cf-dc/2008/394_20080807_e.asp

SECURITY BREACHES IN THE CLOUD

39

IV. Legal Concerns

Image Credit: Burg, Jason. Blog.ViewpointCS.com. <hTp://blog.viewpointcs.com/category/cloud-‐compuRng/>

SECURITY BREACHES IN THE CLOUD (cont.)

40

•  Liability arising from security breaches •  Individual and class actions •  Service providers using the cloud have to rely on

the security of each of the cloud participants receiving personal information

•  How do you do due diligence in the cloud to ensure adequate security is in place?

IV. Legal Concerns

41

PERSPECTIVES OF LAW SOCIETIES

PERSPECTIVES OF LAW SOCIETIES

•  “A lawyer is not expected to anticipate the criminal activity of theft of solicitor-client communications on the Internet any more than mail theft.”

(Federation of Law Societies of Canada, Nov. 1999)

•  No law society has prohibited the use of the cloud •  Lawyers should consider whether cloud technology

could be a useful tool to discharge professional responsibilities

42

V. Perspectives of Law Societies

43

HOW TO WORK THE CLOUD INTO THE LAW FIRM STRUCTURE

SELECT A CLOUD SERVICE PROVIDER

•  Consider the service provider’s reputation •  Review their security and storage methods •  Evaluate their business structure and risks •  Document your evaluation of the provider •  Perform ongoing reviews of your provider

44

VI. How to Work the Cloud into the Law Firm Structure

ASK THE RIGHT QUESTIONS

•  Can I get my data back in a format I am able to use if you go bankrupt or terminate your service, for example for non-payment?

•  Can I easily migrate my data to a new platform? •  How much downtime is there for maintenance?

45


ASK THE RIGHT QUESTIONS (cont.)

•  How do you ensure my data is secure? Note: Always use a secure site starting with “https:”

•  Will you permanently delete my data upon request? •  Can you maintain privilege? •  Will I be notified in the event of a security breach?

46



•  Am I able to access my data on demand? •  Who has access to my data and for what purposes? •  How do you backup data? •  Do you mine my data for personal information?

47



•  Do you allow me to maintain ownership over my data?

•  Do you archive my data? •  What remedies are permitted for non-compliance?

48


CONSIDER THE LOCATION OF THE DATA

•  Take into consideration both the likelihood and gravity of access by government agencies or other third parties

•  Review the availability of remedies, such as an injunction to prevent disclosure

•  Evaluate law pertaining to privacy, privilege and data storage

49


CONSIDER THE LOCATION OF THE DATA (cont.)

50

•  Decide appropriateness on a case-by-case basis •  Consider client’s own obligations

Example: Public sector in NS and BC cannot store data outside its jurisdiction

Image Credit: Trigon Technology <www.trigon.com/cloud-‐services>


OBTAIN CLIENT CONSENT

•  Informed client consent •  Sample engagement letter language:

“Your confidential information may be stored in electronic format on servers that are controlled by third parties and that may be located in jurisdictions outside Canada. You consent to the offsite storage of electronic data on such servers and to communication of your confidential information with third parties for this purpose.”

•  Privacy policy

51


PUT SECURITY FIRST

52 Image Credit: Channelpro-‐SMB. <hTp://www.channelprosmb.com/playbook/cloud_security>

•  Perform regular backups •  Store backups in a fire safe, safety deposit box •  Maintain physical records of originals, material correspondence and accounRng data, especially trust account ledgers

•  Change passwords frequently


53

CASE STUDY: CLOSING FOLDERS INC.

CLOSING FOLDERS INC.

54

•  Closing Folders is a collaboraRve legal project management soluRon that provides a real-‐Rme view of the status of legal transacRons

•  The advanced cloud-‐based sojware is highly secure, easy to use, and can be accessed globally

VII. Case Study: Closing Folders Inc.

CLOSING FOLDERS INC. (cont.)

55

•  InteracRve Closing Agenda •  AutomaRc Version Control & Blacklining •  Centralized CommenRng & Markup •  AutomaRc Signing Package GeneraRon •  One-‐Click, Searchable Closing Books



56



57



58

•  Import Closing Agenda from Word & Excel files •  Upload files by e-‐mail (supports distribuRon lists) •  Collaborate with clients, opposing counsel, etc. •  Built-‐in precedents: set up templates or clone previous deals

•  Bank-‐level security and jurisdicRonal sensiRvity •  Access globally on desktops, smartphones & tablets

www.closingfolders.com


QUESTIONS OR COMMENTS?

Please Contact:

59

Kevin West Founder,

SkyLaw Professional CorporaRon Tel: 416.644.3190

E-‐mail: [email protected] LinkedIn: www.linkedin.com/in/kevinrobertwest