Florida Bar Annual Convention 2019: Blockchain and its Role in Litigation Today and Tomorrow

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The Florida Bar Podcast

Florida Bar Annual Convention 2019: Blockchain and its Role in Litigation Today and Tomorrow

06/28/2019

 

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Intro: Welcome to The Florida Bar Podcast, where we highlight the latest trends in law office and legal practice management to help you run your firm, brought to you by The Florida Bar’s Practice Resource Center. You are listening to Legal Talk Network.

 

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Jonathon Israel: Hello and welcome to The Florida Bar Podcast, recorded from the 2019 Florida Bar Annual Convention in Boca Raton, Florida. This is Jonathon Israel, Director of the Florida Bar’s Practice Resource Center, and I am the host for today’s show.

 

Joining me now I have Daniel Maland, Darren Spielman, and Zach Catanzaro. Thank you for joining us today.

 

Daniel Maland: Thanks for having us.

 

Darren Spielman: Thanks.

 

Zachary L. Catanzaro: Thanks.

 

Jonathon Israel: So before we get started on our podcast, I’d like to allow each of our guests to have a chance to introduce themselves, tell us a little bit about where they’re from, what they do, and what they are speaking about today.

 

Darren, if you want to start?

 

Darren Spielman: Sure. My name is Darren Spielman. I’m an intellectual property, computer law and First Amendment attorney and we have an office in Fort Lauderdale, and I’m also the current Chair of the E-discovery, Electronic Discovery and Digital Evidence Committee for the Business Law Section for the Florida Bar.

 

Jonathon Israel: Zach, if you want to —

 

Zachary L. Catanzaro: Zachary Catanzaro. I am the owner of the Law Offices of Zachary L Catanzaro, where I provide general counsel services to small business owners and entrepreneurships in the area. A large component of my practice is focused on intellectual property and other emerging technology issues.

 

With Darren I Vice Chair the Florida E-discovery Committee. I’m also involved with the Florida Bar’s Digital Currency Task Force which was related to the panel we put on this morning. And I’m also an adjunct professor of Blockchain and Cryptocurrency Law at St. Thomas University.

 

Jonathon Israel: And Daniel, if you want to —

 

Daniel Maland: Sure. My name is Daniel Maland. I’m an attorney with Kozyak Tropin & Throckmorton based out of Coral Gables in Miami, Florida. I generally do bet the business litigation on both sides of the V, so for plaintiffs and defendants, and also consult on different blockchain and cryptocurrency related issues and I’m also a member of the Florida Bar’s Blockchain and Digital Currency Task Force with Zachary.

 

Jonathon Israel: Great. Thank you all for joining us today. So Darren, you mentioned that you’re part of the E-discovery Subcommittee of the Business Law Section which is kind of a mouthful, but you guys are putting on a great seminar today that focused on e-discovery and covered a lot of different topics not just cryptocurrency and blockchain, but as well as other issues that run up with e-discovery. Can you tell us a little bit about what you guys are doing to help the Bar members here?

 

Darren Spielman: Sure. So every year at the Annual Convention we put on a sold-out or nearly sold out four hour CLE, which is always one of the most popular CLEs to come to, and considering the Bar now has a technology competency requirement including CLE requirements, it has increased our membership and attendance at these events and in our committee.

 

The Electronic Discovery and Digital Evidence Committee, the EDDE, which we shortened down to E-discovery Committee most of the time, covers a wide range of topics, covering all aspects of e-discovery both at the Federal and at the State Court level as well as all different versions of digital evidence that parties might come into contact with in the course of litigation or in the course of just dealing with clients.

 

It is our driving mission to help educate. So we do a lot of CLEs across the State and we also do a whole number of CJEs where we go and sit with judges and have lunches with them and give them some of our guidance about things that they’re either struggling with or answer questions and help them kind of get in front of some of the technological issues that they’re seeing that in the trenches we know or that they just don’t have time to learn.

 

So between educating the judges and educating the lawyers and acting as a substantive subcommittee within the Business Law Section we’re pretty busy.

 

Jonathon Israel: Now I can imagine. I mean, it’s such an evolving topic, with the rate of technology picking up and the e-discovery world is just constantly evolving and changing, and then Zach and Daniel had the pleasure of speaking today about cryptocurrencies and blockchains and all the kind of issues that people are running into today with how do you handle e-discovery with those types of things that are going on right there. I don’t know, Zach, if you want to speak to some of the topics that you covered today?

 

Zachary L. Catanzaro: Sure. So in addition to the things that Darren covered, the Subcommittee is also concerned with forward thinking. What sort of changes in technology in the law do we need to be anticipating as practitioners?

 

One of the areas that I’m very interested in concerns machine testimony. As computer algorithms continued to evolve we might one day see technology get to the point that science fiction authors have been writing about for decades now.

 

Conscious AI making decision in testifying as to their sense impressions of things that have occurred.

 

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The Federal Rules while the courts have done a great job adopting them to modern technologies in my opinion kind of fall short of handling these new needs. Part of the panel we really broke into what we felt the technology could potentially present in terms of challenges to the practice, what sorts of testimonial records does this new technology create, what are the best practices for authenticating those records, for getting those records into court, how do we address hearsay problems with machine testimony.

 

At a certain point we’ll see computer algorithms that are sophisticated enough that there’s no human interaction involved with them at all. Do we need to rethink our relationship with the confrontation clause as a result of these changes in computing technologies?

 

So there’s a lot of interesting things going on behind the scenes in addition to what do I need to know today as a practitioner.

 

Jonathon Israel: Yeah. And Daniel, I know your topic today was kind of focused on the blockchain and what people are seeing with e-discoveries as it relates to blockchain, but it was very interesting. I don’t know if you want to —

 

Daniel Maland: Well, I am glad to hear that.

 

Jonathon Israel: Yeah.

 

Daniel Maland: Well, it’s fun. And we had a lot of fun today because we explored future looking topics, but we also discussed how the future is also here and these are major hot topic issues that you read about in the paper but as a practitioner we’re actually starting to see them in our courts and starting to see them with our clients and we’re starting to see our clients utilize this technology and that will lead to new evidentiary issues, new business mindsets and new ways of approaching how you advise your client and how they keep their records.

 

And so one of the fun things we talked about today was how the current rules as they exist regards to evidence play into the technology with regards to blockchain that’s being used today and the issues that practitioners might have trying to introduce that evidence in litigation now, which is actually starting to happen.

 

Jonathon Israel: Yeah, and I think one of the misconceptions that you guys hit on earlier in your session was the anonymity of cryptocurrencies and in this technology that people think everything they’re doing online is totally anonymous where you guys touched on that, no, actually you could be traced back and what you’re doing is not anonymous, but there are some things that practitioners need to know of how to find that and where to look?

 

Daniel Maland: Sure, there’s a ton of misconceptions about the technology and we try to put some of those to bed including that it’s invaluable, and a lot of people think that this record-keeping system is perfect and it will be the future, but it’s still evolving quite a bit, and we’ve noticed some issues that have come up and how people handle it.

 

Jonathon Israel: Right. One of the topics or technology that people are talking about with blockchain is smart contracts and how those are going to progress and come into play and you guys seeing a lot of litigation come through or e-discovery as it relates to smart contracts on the blockchain?

 

Daniel Maland: On the smart contracts side, most of the litigation we’re seeing involves securities. So for example there was the Coburn SEC action, a computer programmer designed a smart contract program that automated buy sell offers for cryptocurrencies and securities online. The SEC took action against this individual for violating the securities law as he didn’t register as he’s required to under Section 5.

 

I anticipate we’ll see more in the business use case side as more large companies start to adopt this technology. Walmart for example has been exploring blockchain and smart contracts as a way to simplify its supply chain management to give its faster response times to food sanitation issues that might pop up.

 

I imagine products liability lawyers will be looking at this technology very closely in the near future. There’s something to be said when a business keeps an immutable ledger that is very accurate from a point to point to point basis, and what I mean by that is Walmart is rolling out a new supply chain system where the individual farms will code their product and then upload that code into the blockchain.

 

When the trucking company picks it up to take to the food preparer manufacturer, there’s another entry into the blockchain, when it’s delivered there will be another entry to the blockchain. When it’s processed and shipped out there will be another entry to the blockchain, and you start building this very comprehensive database that’s time-stamps, immutable, very difficult to commit fraud on. It gives Walmart the peace of mind that its business operations are protected from fraud by its suppliers or material mans and in the event that God forbid somebody gets sick eating one of their products they can very easily trace where that product came from, and they could potentially leverage that as a way to defend themselves.

 

Darren Spielman: And we’re also starting to see a lot of unique industries adopting this technology where we would have never thought progress would happen so quickly and one example is the Maritime industry, which is an old things have done been the same way for a while for a long time and they’re one of the quickest adapters of blockchain and distributed ledger technology because it builds such efficiencies into their model.

 

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And so when they are dealing with cross-border transactions Maersk and IBM had a case example where they are shipping container of flowers from Nairobi to Amsterdam, and I believe they reduce the number of individual contracts from 200 down to just a collection of smart contracts that auto-executed where previously 200 individual contracts had to be looked at by individuals, recorded, other people have to be notified when they are signed off on, this whole process has been automated and put into a cohesive system that is trustworthy, fluid, and works equally well in Amsterdam as it does in Nairobi.

 

That’s very cool. So the transportation industry, especially the supply chain is really being changed dramatically by this technology.

 

Jonathon Israel: No, that’s great, I think it’s an awesome technology and it’s really cool to see all the different ways people are putting it to use.

 

Darren Spielman: Because it’s so nascent and because it’s being so recent, it’s been so recently adapted, it hasn’t had a chance to trickle into the courts yet at the same volume as the securities cases that Zachary just talked about.

 

Cryptocurrency has taken the limelight when it comes to recent litigation but as companies figure out new ways to utilize blockchain in the financial sphere, in the supply chain sphere and the retail universe and a lot of different areas, real estate especially, Vermont has started allowing companies to record property transactions directly on the blockchain, which is impressive.

 

There’s going to be a lot of issues that may arise that will end up in court. We’re just not seeing them yet but we anticipate they’ll be coming soon.

 

Daniel Maland: And I think that goes hand in hand with what we were trying to accomplish with our yearly Annual CLE, where we bring in different technologies and different topics that really help educate members of the Bar. We had a judicial panel of four different judges, two from the federal court and two from the state court to kind of educate and let the members of the Bar understand how they are viewing these issues that are coming in.

 

Just like for everyone else, these are new topics and even these guys who are supe-techy and really understand blockchain, it’s still complex and hard, and that complexity is only going to get worse and more cumbersome for attorneys who aren’t paying attention.

 

So our hope is that through things like this we get to help let members of the Bar know more about these topics and show up in court or work with opposing counsel when you’re litigating so that these issues are discussed before you show up in court. For anyone who is in that last hour, we had these four judges who really rang home again and again that they can’t stand when attorneys are showing up and they haven’t even talked about the issue or they get up and scream and yell and say the same thing that they have heard for years, it’s too expensive or it can’t be done.

 

And that it can’t be done is just very rarely actually the result.

 

Jonathon Israel: Right. No, that’s great, that you guys are out there putting this education together for the attorneys. So for anybody who wants to find out more about this or reach out other than joining Business Law Section, how else — where would they go to learn about this stuff?

 

Daniel Maland: Well, if you would like to learn more information obviously, you can always reach out to the committee and if you’re in a portion of the State, where you believe that your judges could be best served by having a CJE, we’re glad to come and put on a presentation or if your local bar chapter wants us to come and do a CLE, we’ll certainly do that.

 

You can always reach out to the Business Law Section and/or find our contact information on the Business Law Section’s website.

 

If you want additional generalized information about eDiscovery, a great place to start is The Sedona Conference. It is a publicly available fantastic platform that has a lot of really great information.

 

Remember, you have a tech requirement now in the State of Florida, you must be competent and for those of you who are worried about your malpractice, yes, this is affected in that area too.

 

As it relates to blockchain and crypto, I would point to these gentlemen as a good source for where you can find learnable information.

 

Zachary L. Catanzaro: Yes, so there are a number of good sources online that cover the hot topics in cryptocurrency and blockchain. CoinDesk, for example, has probably the most reputable blog. They try to take a neutral approach to reporting on industry trends, things that we’re seeing, and it’s not just the private sector that is taking interest in this technology. There is a lot of public sector interest in using this for voting records, for example. So to kind of relate this back to the practitioner’s perspective, regardless of what area of law you practice in, this technology is coming and it’s going to impact your practice.

 

You’re an election practice, blockchain, records stored on voting records, they’re going to be something that a lot of states are starting to pay attention to. If you are for example in title insurance or real estate, blockchain recorded title transfers are coming, you need to be ready for them.

 

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If you’re in family law, you need to be asking for digital assets, does the opposing party hold cryptocurrency, you need to know about that. You need to be asking these things. You’re in business law, if the opposing party is generating records on a blockchain, you need to make sure that you have a competent expert that can testify as to potential issues with authenticity and things of that nature.

 

So we’re seeing a lot of areas of practice that are just now starting to hit this first wave of needing to really up their competency with this information.

 

Daniel Maland: And State Bar Association’s Florida in particular has been proactive in trying to figure out how to entice and encourage blockchain industry in the State, but also handle it appropriately and it’s not a novel issue for Florida though. Every State is looking at this in adopting legislation, figuring out how they can entice people to bring this technology to them and bring this business to them.

 

So wherever you are, there’s legislation being drafted or being entered that brings us into play and if you go into common legal research resources, they’re often tracking them and there’s a lot of online resources right now that cover the basics as to what blockchain is, how distributed ledgers work, what the cryptocurrency markets are like and how they play out and pragmatic questions are answered online and common research tools that you have accessible to you as an attorney, you just have to type in the words and look for them, and you’ll be surprised what you could find.

 

Zachary L. Catanzaro: Yeah, one of the other panelists who couldn’t join us for the interview today, Drew, has conducted a recent survey of proposed blockchain related bills at the State level and he found there were 164-165 proposed just in the last legislative cycle. So, it’s common, you got to be ready for it.

 

Jonathon Israel: Yeah, definitely. Unfortunately, it looks like we’ve reached the end of our program for today. I want to thank you each of our guests for joining us. So if our listeners have any questions or wish to reach out to each of you individually, Daniel, how can they best reach out to you?

 

Daniel Maland: Sure. I could be reached via email which is [email protected]. We also have the KTT Fraud Law blog, if you just Google KTT Fraud Law, you’ll find our blog.

 

Jonathon Israel: All right, thank you. And Zach.

 

Zachary L. Catanzaro: I can be reached by email. My email is [email protected]. You can also tweet at me for general questions. My Twitter handle is the same, it’s @brainstorm_law.

 

Jonathon Israel: Okay, thank you. And Darren.

 

Darren Spielman: If you want to reach me, you can go to my website at ComplexIP.com. We’re on social media, of course @complexip for Facebook and Instagram and its @ComplexIPLaw for Twitter. If you have any specific questions regarding the eDiscovery committee by all means go on to the Florida Bar’s Business Law Section website and you can reach out directly thereto as us as well, we have a blog on that site as well, and those community meetings are always open, you’re always welcome to come to any of them and we would encourage you to come to the Business Law Section’s Labor Day Retreat, which is at The Ritz-Carlton in Naples coming up.

 

Jonathon Israel: So that’s all the time we have for this episode of The Florida Bar Podcast. Thank you to our listeners for tuning in. If you like what you heard, please rate and review us in Apple Podcasts, Google Podcasts, Spotify, or your favorite podcasting app.

 

I’m Jonathon Israel, until next time, thank you for listening.

 

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