April 22, 2015 Top Story

Attorney's Lien Extends to E-Discovery Database

State appellate court finds law firm had possession because it directed work

Lisa R. Hasday

A law firm’s transfer of client documents to an e-discovery vendor does not constitute a release of possession that would destroy the firm’s retaining lien, the Appellate Court of Illinois held, even if the client paid almost all of the vendor’s fees. Cronin & Co., Ltd. v Richie Capital Mgmt., LLC. Central to the court’s decision was the fact that the vendor took its directions from the firm.

Dispute over Database Access

The client, various companies owned by a hedge fund manager, hired the law firm in 2009 to assist in recovering investment losses due to the companies’ unwitting participation in a Ponzi scheme. In 2012, the client authorized the firm to retain a third-party vendor to manage the case files electronically. The client gave money to the law firm to pay for the vendor’s services.

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