MAXIMILIAN FRANZ

William McComas

Cloudson the horizon

Maryland law firms are cautiously moving toward the latest trend in outsourcing: Internet-based computing.

Maryland LawyerMonday, December 6, 2010

News and analysis of legal matters in Maryland

BY DANIELLE ULMAN

Danielle.Ulman@TheDailyRecord.com

loud computing is beginning togain traction with local lawyersdespite broader concerns aboutthe security of storing docu-ments and programs on remote

servers.The practice allows businesses to

access files and programs through theInternet (the “cloud”) instead ofinstalling the software onto their ownserver or individual workstations. Firmscan cut costs by paying a monthly feerather than buying and maintaininghardware or paying licensing fees for

products. For a small firm, the cost sav-ings of not having to own or maintainthe server hardware or have an IT per-son on staff could have a big impact.

It’s a concept many people use with-out realizing it or knowing its name.Examples include free e-mail servicesthrough Google or Hotmail.

And it’s the latest in a line of func-tions outsourced by law firms, includingmailrooms, payroll, custodial staff andlitigation support.

Looking into cloud computing is nat-ural in a law firm’s progression to see“whether it’s financially beneficial tomove their technology platform fromthe four walls of their office to a data

center that can handle their informationmore efficiently,” said Steven Stern, aBaltimore lawyer whose company,Legal Technology Solutions, helpsfirms use technology more effectively.

Like all shifts in technology, thereare many naysayers who disfavor cloudcomputing, which is essentially rentingserver space from a third party, and oth-ers who are early adopters.

“To pacify the people who are sort ofthe pooh-pooh people on it, I would say,‘What are we doing now? We’re alreadyoutsourcing stuff,’” said WilliamMcComas, a partner with Shapiro,

Sher, Guinot & Sandler whose prac-tice focuses on technology.

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“What happens if something getsmishandled? Firms are already sort ofmanaging it now,” he said.

Security, speedEven so, McComas acknowledges

that there are reasons to be concernedabout shifting e-mail and other docu-ments to the cloud. The major ethicalissues — the safety of client data andwhether using the cloud will, in anyway, waive the attorney-client privilege— need to be discussed, he said, butshould not stop firms from moving for-ward with using remote servers.

McComas came across the sameissues in the past. He said in the early1990s, lawyers were afraid they wouldbe waiving certain privileges by sendingout e-mails. He got around the problemby including a line in his engagementletters saying that he was authorized touse the Internet.

The same should be true untillawyers and clients get comfortablewith cloud computing, he said. By dis-closing the practice in an engagementletter, the lawyer will get the approvalfrom the client.

In terms of security of client infor-mation, McComas said client docu-ments might be better protected on thecloud than on office servers.

“If you put yourself out on the cloudyou’ll probably find you have more-pro-fessional people handling the files thanyou would at a firm or anywhere else,”he said. “If you’re using Google Docs orGoogle Calendar you’ve got Google’sengineers handling it. Who’s better? ITpeople don’t usually flock to law firms.”

Not everyone agreed.Brian Moffett, a partner at Gordon,

Feinblatt, Rothman, Hoffberger &

Hollander LLC in Baltimore, said hecould not think of a scenario where thefirm would allow a vendor to control its

primary servers.“We do have a third party maintain

our backup servers, but I think it’s amatter of being able to control yourinformation and protect your informa-tion especially when that informationcontains client confidences,” he said.

Others are on the fence. Stern, ofLegal Technology Services, said it’s veryeasy to get a virus on an in-office serveror have someone hack into the system.However, he said cloud computingmakes client confidentiality a concern.

“Until there’s litigation on this, oruntil they can codify what your safe har-bor is, you have to worry about it,” hesaid. “A law firm, unlike any other busi-ness in America — you have an obliga-tion to your client to keep everythingconfidential. There’s an expectation ofnot only privacy, but also security.”

While privacy and security issues are important, Michael Oliver, shown in the server roomat Bowie & Jensen, says law firms must also be concerned about the speed of a cloud-basedsystem. ‘If the system doesn’t allocate you enough power, your service is real slow,’ he says.

MAXMILIAN FRANZ

DEFINING THE TERMS The term “cloud computing” was inspired by the cloud image often used to repre-sent the Internet in flowcharts. It’s a concept that can confuse, but many peopleuse the cloud for personal e-mail or photo storage (think Gmail and Snapfish). Hereare some definitions to get you on your way:

Cloud computing: Internet-based computing that moves key services like e-mail,document storage and other software onto servers owned and operated by athird-party vendor. Maintenance and costs can be reduced or simplified.

Partly cloudy: A mix of in-house servers and Internet-based computing.

SAAS: Software as a service. Another term for cloud computing.

Virtualization: A practice that allows a single physical server to divide into multiplevirtual servers. This server can operate multiple workloads and applications atonce. Offers cost savings and reduced maintenance.

Michael Schreyer, a founding part-ner of Alpert Schreyer LLC, had con-cerns about the security of client infor-mation when his five-attorney firmstarted looking into cloud computing,but quickly changed his mind.

“I think the data security issue islooked at the wrong way,” he said. “Ithink there’s a data security issue host-ing your data on your own serverbecause you don’t have the sophistica-tion to provide the security that youwould if you were a large firm.”

Alpert Schreyer formed out of twoother firms this year and has offices inPrince George’s and Charles counties,making cloud computing a naturalchoice.

“We wanted to have one virtualoffice, if you will,” Schreyer said. “Wefigured out how to do that with tele-phone services. The next step was to dothat with case management softwareand other resources.”

The firm switched over to cloudcomputing with a company called LegalWorkspace just two months ago, so thesavings haven’t been tallied yet. But asSchreyer ticked down the list of finan-cial benefits — a flexible contract, soft-ware that isn’t loaded onto each com-puter, cheaper computer maintenanceand having the latest software withoutpaying to upgrade — he said the valuecould add up.

The savings for Bowie & Jensen

LLC, a Towson firm with about 20lawyers thinking about moving itsservers to a third-party vendor, couldalso be significant.

“We’re looking into virtualization,which is a big deal,” said Michael Oliver,a partner at Bowie & Jensen who prac-

tices law in transactional intellectualproperty matters and is also the firm’sWeb coordinator.

If Oliver’s firm transitions and doesit “right,” he said, Bowie & Jensen couldreap savings of 30 percent.

One big savings for the firm wouldbe taking Oliver off of computer-mainte-nance duty, freeing him up to bill formore hours.

Oliver, who was a software program-mer before he became a lawyer, hasmanaged the firm’s IT system for 15years. When he started handling IT, thefirm had three lawyers, but now he saidthe job takes up a lot more of his time.

While Oliver has similar concerns asthe others about moving the system to aremote location, his biggest concern isspeed.

“When you put things up in thecloud-based services, if the systemdoesn’t allocate you enough power yourservice is real slow,” he said.

The firm’s outside tech support,which works only with law firms, hastold Oliver the lack of speed has been aproblem for several law offices. He has“de-virtualized” some firms who movedtheir systems to the cloud last yearbecause of the speed problem.

Private cloudLinowes and Blocher LLP, which

has about 50 lawyers in its Bethesdaand Annapolis offices, is building a “pri-vate cloud,” in which programs arelocated on a server in one of theiroffices but can be accessed by both.

The system will be in its Bethesdaoffice, mostly because Linowes is doinga firm-wide upgrade of its computer sys-tems and it could not get pricing for a

public cloud system. The plan is toeventually move the servers to a remotelocation.

“We have folks who want totelecommute and right now we do nothave an effective way to do that,” saidEmily Vaias, the firm’s technology part-ner.

“Because the cloud is probably thefuture and we’re upgrading now, we fig-ured we should get on the cutting edgehere and take the leap to do the cloud,”she said. “People need to be able towork from home when there’s a bliz-zard, when there’s a power outage.”

Reprinted with permission of

The Daily Record Co. ©2010

IMPORTANT QUESTIONS TO ASKWhat should you ask before going to the cloud? Steven S. Stern, president and CEO of Legal Technology Solutions, has compileda list of questions adapted from a list offered by the North Carolina Bar Association. Below is a sampling:• Who owns the data — the lawyer or the vendor? (If you don’t pay your bill, will they allow you to get the data back?) • If the lawyer terminates use of the product, or the service otherwise has a break in continuity, how does the lawyer retrieve

the data and what happens to the data hosted by the service provider? • If the vendor goes out of business, will the lawyer have access to the data and the software or source code? • Can the lawyer retrieve data off of the servers for his or her own offline backup? • If the lawyer decides to cancel the subscription, will he or she get the data? Is data supplied in a nonproprietary format com-patible with other software? • How often is the user’s data backed up? Does the vendor back up data in multiple data centers in different geographic loca-

tions to safeguard against natural disaster?

• If clients have access to shared documents, are they aware of the confidentiality risks of showing the information to others? • Does the law firm have a backup for shared document software in case something goes wrong, such as an outside servergoing down?

Emily Vaias, technology partner at Linowesand Blocher, says the firm decided to ‘take the leap to the cloud’during its systems upgrade.