Biglaw Firm Facing Lawsuit Over Hack Of Client Data
The vulnerability of Biglaw on display.
Now, I’m not a Biglaw firm leader, but I have to imagine one of the things that keeps them up at night is the threat of hackers. It’s an ever-present scourge and the firm has a constant stream of highly sensitive client documents hackers would just love to to get their hands on.
And if your firm does fall victim to hackers, there’s more than angry clients you may have to smooth things over with — there’s also the federal government. Covington & Burling has been hit with a lawsuit by the Securities and Exchange Commission. At the heart of the complaint is a 2020 cyber attack suffered by the firm by the Hafnium cyber-espionage group, who allegedly has ties to the Chinese government. The SEC is seeking the identity of 298 publicly traded firm clients whose information is alleged to be compromised, saying they’re investigating possible securities violations.
As reported by Reuters, Covington downplayed the scope of the breach.
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In a letter to SEC investigators filed in the case, Covington’s legal team said an internal investigation determined the hack was directed at a “small group of lawyers and advisors” and was focused on “policy issues of specific interest to China in light of the incoming Biden Administration.”
And protecting attorney-client privilege is playing a large role in the firm’s response to the lawsuit:
The law firm told the SEC it is bound by attorney-client privilege and client confidentiality to resist the portion of the subpoena requiring it to name its clients. It said only seven of the affected companies’ files contained information that could be material to investors, a figure the commission said it could not verify, according to the SEC’s lawsuit.
The firm has confirmed they experienced a “state-sponsored” cyberattack. They also said they’ve communicated with impacted clients and worked with the FBI on an investigation into the attack.
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Kathryn Rubino is a Senior Editor at Above the Law, host of The Jabot podcast, and co-host of Thinking Like A Lawyer. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter @Kathryn1 or Mastodon @Kathryn1@mastodon.social.
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