Ride the Lightning

Lawsuit Says Insurers Hacked Into Legal Files – Law Firm Named a Defendant

July 9, 2015

The ABA Journal noted a fascinating news item, involving the client of a California law firm who says insurers hacked into tens of thousands of confidential client files as part of a nationwide scheme to get an advantage in worker’s compensation cases.

The federal class action filed last week by Hector Casillas names as defendants not only the insurers allegedly involved but also law firm Knox Ricksen, four attorneys and a claims service company, as well as two insurance company employees.

“Powerful insurance companies and their co-conspirators who, because of their immense wealth and power, acted as if they were above the law” hired investigators who hacked into and stole attorney-client files, the Los Angeles suit says. It alleges that the files in which unauthorized access occurred concerned worker’s comp cases where the defendant insurers were potentially liable for making payments. Knox Ricksen, the suit states, “willingly and knowingly participated.”

Casillas, a client of the California firm Reyes & Barsoum, says his lawyers first suspected hacking at an April 20, 2014 hearing. At that hearing, opposing counsel from the Knox Ricksen firm turned up with an attorney-client privileged intake packet for Casillas’ case. It listed Rony Barsoum’s name and included the firm’s retainer agreement. Asked by the judge at the hearing how they got the confidential file for Casillas, opposing counsel gave several explanations and finally said they didn’t know, the suit alleges.

The suit asserts causes of action for alleged fraud, conversion and invasion of privacy and violation of state and federal statutory law, among other claims. Remedies sought include injunctive relief, disgorgement and exemplary damages.

Law360 (sub. req.) says a state court lawsuit making similar claims was filed by Reyes & Barsoum against Knox Ricksen in Los Angeles in February. That suit claims that 2,000 case materials were taken from Reyes & Barsoum. That suit also alleges that Knox Ricksen attorneys admitted that they had obtained more than 30,000 files and documents from a password-protected computer network operated by HQ Sign-Up Services Inc., which Reyes & Barsoum used to store privileged and confidential documents.

Until the smoke clears, we won't know the truth, but there sure is a lot of smoke. A case to watch.

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