Mayer Brown Balks at Idea It Was Spied on by U.S. Ally It Once Advised

, The Am Law Daily

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Stopping short of a full-fledged denial, the Am Law 100 firm pushed back early Monday against the suggestion, laid out by The New York Times, that its lawyers' communications with a foreign client were intercepted by an Australian spy agency with the National Security Agency's blessing.

Citing a Feb. 13 document obtained by former NSA contractor and self-styled whistle-blower Edward Snowden, the Times reported over the weekend that the Australian Signals Directorate had informed the NSA that it was monitoring communications between Indonesian officials and the U.S.–based law firm representing the country in trade talks with the U.S. government. According to the document, the NSA was told by its Australian counterpart that "information covered by attorney-client privilege may be included" in the surveillance, but that after discussions with the NSA's general counsel, the Australians continued "to cover the talks, providing highly useful intelligence for interested U.S. customers."

Though the document did not identify the law firm, Mayer Brown represented the Indonesian government at the time in trade disputes with the United States before the World Trade Organization involving clove cigarettes and shrimp. Indonesia ultimately prevailed in the cigarette case, which The American Lawyer dubbed Global Dispute of the Year in the international litigation category in its inaugural Global Legal Awards last year. (Separately, U.S. Senate lobbying records show, Mayer Brown has earned $235,000 since 2008 for its U.S. lobbying efforts on behalf of the Winston-Salem, N.C.–based Specialty Tobacco Council and Indonesian clove cigarette maker P.T. Djarum.)

Just after midnight Monday, a Mayer Brown spokesman released the following carefully worded statement in response to a request for comment about the Times article. "Media reports indicate that some attorney-client communications related to Mayer Brown's representation of the government of Indonesia may have been intercepted through electronic surveillance of Indonesia's communications by the government of Australia. There is no indication, either in the media reports or from our internal systems and controls, that the alleged surveillance occurred at the firm. Nor has there been any suggestion that Mayer Brown was in any way the subject of the alleged scrutiny. Mayer Brown takes data protection and privacy very seriously, and we invest significant resources to keep client information secure."

The firm—which, as The Am Law Daily reported last week, rode a solid financial performance around the world to roughly $1.45 billion in gross revenue and a record $1.285 million in profits per equity partner last year—declined further comment.

The statement is clearly aimed at reassuring the many international clients Mayer Brown's lawyers contact regularly by email and cellphone that their confidential information is safe—and somewhat more emphatic than the comments attributed to one of the firm's attorneys by the Times. "I always wonder if someone is listening, because you would have to be an idiot not to wonder in this day and age,” Duane Layton, the Washington, D.C.–based partner who leads Mayer Brown's government and global trade practice. "But I've never really thought I was being spied on."

That, says John Simek, is a mistake too many lawyers and law firms continue to make.

Simek, vice president of Sensei Enterprises Inc., a Fairfax, Va.–based legal technology, information security and digital forensics firm, says that no matter how robust Mayer Brown's own mechanisms for preventing snooping are, there is only so much that is within the firm's control given the way information whips around the world these days. Which is why he would take little comfort in the firm's contention that no surveillance occurred "at the firm."

"You have no idea where the communications may have been intercepted," says Simek, who adds, "I think in general law firms have not done enough to properly secure their own environments and communications networks." Another thing to consider, he says, is the proficiency of those doing the eavesdropping. "These guys are good. I wouldn't expect you to know whether they've been getting access to your communications."

Crowell & Moring senior litigation partner Stuart Newberger learned that lesson several years ago while squaring off against the Turkish government on behalf of the family of Turkish businessman and politician Cem Uzan. In the course of appearing before the World Bank's International Centre for Settlement of Investment Disputes amid the family's claim that its business empire had been dismantled for political reasons, Newberger says he learned, inadvertently, that the Turkish government had obtained secret court orders allowing them to intercept thousands of emails and hundreds of cellphone calls between him and his client.

Though the circumstances are different, Newberger says he felt a flash of the familiar when he read the Times story about the Australian eavesdropping.

"I'm not surprised it happened," says Newberger. "I'm surprised it was disclosed." To Newberger, who says he generally supports the government's legal tactics where the fight to stop terrorists is concerned, what the Times documented is "over the line, not a gray area."

Says Newberger: "My government should not be in the business, for anybody's sake, of intercepting what we as a society consider sacrosanct, which is privileged communication. This is a threat to the rule of law." For laws firms—and especially those that practice internationally, given the breadth of their business and the scope of the global security apparatus—the stakes are simple, he adds: "No privilege, no business."

In a statement to the Times, the NSA declined to comment on the details included in the Snowden document. Broadly speaking, the agency said, "Any allegation that the NSA relies on foreign partners to circumvent U.S. law is absolutely false. The National Security Agency does not ask its foreign partners to undertake any intelligence activity that the U.S. government would be legally prohibited from undertaking itself." The statement went on to say that "NSA's Office of the General Counsel is consulted when issues of potential privilege arise" and that "a variety of steps might be taken to protect potentially privileged information, consistent with NSA's foreign intelligence mission." (As sibling publication The National Law Journal reports, the revelations that a U.S. law firm's communications with a foreign government client by an NSA ally may provide new impetus for the U.S. Supreme Court to revisit a 2013 decision that involved the nation's electronic surveillance law.)

The NSA's position notwithstanding, the Times article has "created quite a buzz," according to an Am Law 100 partner versed in national security–related issues who notes that "it's reasonable to believe that Australia isn't the only government that's doing this kind of thing."

That idea is most likely beginning to make a dent among the many Am Law 200 firms that rely on international business from legal and lobbying assignments for a substantial chunk of their revenue—a group that includes some 28 firms registered with the Justice Department as active agents of foreign entities. Mayer Brown, it turns out, is not currently on that list. It ended its last such engagement in 2004, when it earned $129,000 for lobbying U.S. officials on free trade issues on behalf of the Australian government.

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