In the legal industry, data is the foundation of every case, dispute, legal issue, and client relationship. Whether it’s a law firm helping a client with a claim, an Alternative Legal Service Provider (ALSP) offering e-discovery services, or a legal-tech platform helping businesses with document management, at the core of it, it all runs on ‘data.’
Given the vast amount of sensitive, valuable information that organizations hold, they have become a prime target for cybercriminals. In addition to shielding their businesses from external and internal threats, organizations also need to ensure compliance with regulatory and legal requirements around data.
In this article, we’ll explore why data protection is crucial in the legal industry – especially for law firms – and what steps they can take to safeguard their data and business.
The shift to cloud and SaaS
As law firms and legal teams ramp up their digital transformation efforts, we’re seeing a big shift towards adopting cloud-first infrastructures and SaaS platforms like iManage Cloud, Microsoft 365, Google Workspace, DocuSign, along with cloud-based IAMs like Okta and Microsoft Entra ID. While these platforms offer better collaboration and efficiency, they also introduce the possibility of new data security threats – both internal and external.
Today, ransomware attacks have become one of the most common, and an impact to law firms. Recent cyberattacks on law firms have resulted in millions of dollars in financial loss, regulatory fines, and legal liabilities.
Even with measures to protect a business against external threats, internal threats like simple human error, malicious employee actions, automation errors, third-party risks, and more, can still lead to severe financial and reputational damage.
The legal industry is at a crossroads of digital transformation, rising threats, and an increase in data volume and criticality, making it essential for organizations to strengthen their data protection efforts.
Understanding legal data and its importance
Data is the backbone of the legal industry, forming the foundation for case proceedings, legal contracts, client representation, evidence, communication records, compliance, and much more.
Legal data comes in several forms, including emails, documents, images, and recordings, typically spread across different platforms and applications.
Challenge of managing legal data across multiple applications
As law firms increasingly adopt and rely on cloud-based solutions to enhance collaboration and efficiency, they also face complexities with data protection such as:
- Data Stored in the Cloud Does Not Mean It Is Protected – Most organizations assume that cloud or SaaS platforms automatically back up their data. In reality, they follow the “shared responsibility model.” This means that while these platforms take responsibility for features and functionality, infrastructure, patches, and service availability, customers are responsible for protecting their data against disruptions and outages caused by human error, attacks, or misconfigurations.
- Siloed Data Creates Visibility Gaps – Legal data is spread across several solutions on-premises and in the cloud. The growth of specialized cloud-based applications that address specific challenges in the legal industry can create siloed data. These silos contain critical bits of data but can often slip through the cracks when you are trying to track, protect, and maintain them.
- Data Retention Policies Are Not Uniform – Legal cases can span years, but cloud applications often limit data retention windows. If a file is deleted beyond a certain timeframe, it may be permanently lost. Since most of these applications are built with an industry-agnostic user base in mind, they may not always align with the data retention and compliance needs of the legal industry.
Catastrophic consequences of losing legal data
Losing critical legal data isn’t just an inconvenience – it can be devastating to any business. In the legal world, losing access to critical information can have irreversible consequences, ranging from missing important or court-imposed deadlines to creating a breach of attorney-client privilege to financial penalties. Five of the leading consequences for data loss are:
- Severe operational disruptions affecting deadlines and billable hours
- Hundreds or thousands of hours lost in manually reworking on or recreating files
- Legal malpractice claims and customer distrust due to mishandled evidence and client data
- Massive financial and reputational damage due to a ransomware attack
- Regulatory fines and compliance violations for failing to protect sensitive data
Many recent incidents have shown us just how devastating data loss can be for law firms and legal organizations. We’ll discuss this in more detail in the next section.
Rising cybersecurity threats in the legal industry
Law firms and other legal organizations are becoming prime targets for cybercriminals that can lead to a rapid increase in data breaches, ransomware attacks, and insider threats. The volume, sensitivity, and value of the data they store are making them attractive targets for bad actors looking to steal, manipulate, or ransom valuable information.
Some recent statistics speak for themselves, showing how law firms are being aggressively targeted by attackers:
- 77% surge in cyberattacks targeting UK law firms over the past few years.
- Law firms hit with an average ransomware demand of $2.5 million.
- Global ransomware damage is predicted to exceed $265 billion by 2031.
- Law firm cyberattacks grow, putting operations in legal peril.
Let’s look at the top threats law firms face today:
1. Ransomware attacks: Ransomware is one of the biggest cyber threats to law firms today. In a ransomware attack, attackers use malware to encrypt legal data, rendering it inaccessible unless a ransom is paid, often demanding millions of dollars to restore access.
2. Insider threats: Not all threats come from external attackers. Law firms are also vulnerable to insider attacks. Whether it’s a disgruntled employee, a bad actor with unauthorized access, or ex-employees and contractors still having access to some systems, insiders can cause just as much damage as cybercriminals. They can silently delete files, tamper records, or share sensitive information outside of the organization.
3. Third-party and supply chain attacks: Law firms rely on several third-party software and cloud providers to store, manage, and share data. However, third- party platforms can have their own security vulnerabilities, allowing hackers to infiltrate a law firm’s systems. In some cases, total failures or disasters at a third-party’s end can lead to system or network outages, making data inaccessible or even lost forever.
4. Human error: Human error like accidental deletions, misconfigurations, and mistakes due to high change rates are major causes of data loss in organizations. A simple error can lead to unintended changes in a file, deletion of important records, security vulnerabilities due to misconfigurations, or can even delete an entire cloud instance!
Some recent cases like the Meow Ransomware attack on a Texas law firm, the DLA Piper Petya ransomware breach, and the ALPHV/BlackCat breach of a pro bono law firm are just some examples that highlight the urgent need for data security, redundancy, and recovery solutions.
Let’s take a deeper look into what happened in the DLA Piper ransomware attack:
What happened?
DLA Piper, a global law firm, in 2017 was hit by the Petya ransomware attack, which affected thousands of their systems worldwide. As a result of the attack, all case files, emails, and legal documents became inaccessible, disrupting operations and client communications.
What was the impact?
The firm had to shut down systems for days, leading to millions in losses. All billable work had stopped which affected both revenue, client relationships, and reputation.
Regulations and compliance frameworks governing legal data protection – H2
With the rise in attacks and law firms moving to cloud and SaaS platforms, regulatory bodies have mandated that firms ensure that their data protection strategies align with legal compliance requirements.
Key legal data protection regulations
American Bar Association (ABA) Formal Opinion 498
The ABA mandates cybersecurity and data protection best practices for legal professionals handling client data. It states that:
“Lawyers must ensure that data is regularly backed up and that secure access to the backup data is readily available in the event of a data loss.”
Network and Information Systems 2 (NIS2) Directive, Europe
The NIS2 Directive (Article 21(2)(d)) specifically mandates backup management and disaster recovery for organizations operating in or having customers in the EU region. It states that:
Organization are required to implement “business continuity, such as backup management and disaster recovery, and crisis management".
The role of data protection solutions in the legal industry
As cyber threats increase and compliance regulations tighten, law firms must proactively protect their data to ensure it’s always available and protected from any kind of loss.
Modern data backup and recovery solutions like HYCU are essential in safeguarding legal data, ensuring business continuity, and meeting regulatory requirements. This section outlines the key components of an effective data protection strategy that can help legal teams stay resilient.
Key components of a data protection strategy
An effective data protection solution should provide:
1. Automated, offsite backups: Ensures files, emails, privileged documents, and other data are automatically backed up without manual intervention and stored in secure offsite locations owned and controlled by the customer.
2. Ransomware protection with immutability: Prevents attackers from modifying, encrypting, or deleting backup data by supporting WORM-enabled immutable storage.
3. Quick granular recovery of data: Offers the ability to restore specific files, emails, user accounts or other legal data from a chosen restore point.
4. Data exports: Allows organizations to export critical legal data to an offsite location, providing an alternate way to access data even when primary services are unavailable.
5. Data governance and residency: Offers the ability to set custom retention policies for the backup data and provides the flexibility to store backups and run backup and recovery operations in the region of choice. This ensures compliance with industry regulations and requirements.
6. Comprehensive data protection: Enables organizations to protect multiple workloads across on-premises environments, cloud, and SaaS apps from a single solution. This helps reduce third-party risk and operational complexity by eliminating the need for multiple point solutions.
7. Encryption and access controls: Encrypts data at rest and in transit, ensuring end-to-end security and allows organizations to control who can access, edit, or restore backups through role-based access controls (RBAC).
Take control of your legal data protection with HYCU
As legal data continues to spread across cloud and SaaS applications, it’s crucial to implement a comprehensive strategy to protect these silos of data under a single roof.
A solution like HYCU, that offers backup and recovery for 80+ workloads across on-premises, cloud infrastructure, and SaaS applications, is an essential tool for the legal industry.
Several applications that are commonly used in the industry, including iManage Cloud, Microsoft 365, DocuSign, Google Workspace, and IAM solutions like Okta and Microsoft Entra ID can be protected from a single dashboard.
With HYCU, organizations can:
- Quickly restore your entire instances or granular data with one click
- Automate backups with ‘set and forget’ policies running 24/7
- Store ransomware-proof, immutable backups
- Keep control of your data – you choose your storage target
- Protect 80+ workloads across on-prem, hybrid environments, and SaaS applications from a single solution
- Export backup data for applications like iManage Cloud on to an offsite storage
Additional Resources
- Protecting legal data: HYCU for Law Firms
- Federal Data Protection: Compliance and Security
- What is the Digital Operational Resilience Act (DORA)?
- DORA Compliance Made Easy
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