Monday, November 5, 2012

Post-Sandy, In-House Counsel Plan Ahead for the Next Storm

Corporate Counsel

In the wake of Superstorm Sandy, many businesses along the East Coast have been contending with a scattered workforce, telecommunication gaps, and property damage—to name but a few after-effects of the epic storm. Yet despite the increasingly frequent reminders from Mother Nature, planning ahead for catastrophe often gets short shrift from companies.

"It's just not the kind of thing people concentrate on," says David Bienvenu, who chairs the American Bar Association's committee on disaster response and preparedness.

As municipalities, companies, and individuals continue to act in recovery mode, what better time for in-house counsel to take stock of what went well pre- and post-Sandy—and what needs improvement before the next time.

Bienvenu, a partner at Simon, Peragine, Smith & Redfearn in New Orleans, stresses that being able to locate employees and make sure they are safe is the number one priority.

"First of all, know how they can be found and how they can find you when things shut down," he says.
Which means that counsel need to think about the communication mechanisms your company has in place to maintain contact. After Hurricane Katrina for example, Bienvenu's law firm needed to purchase a fleet of new mobile phones to make up for lost cellular service, so that employees could communicate with one another. Later, the firm adopted a web-based message board to enable everyone to stay in touch should a similar event occur.

Disaster preparedness is critical to a lawyer's job. "We've got an obligation to secure our clients' property, our clients' information," says Bienvenu, "and not being prepared to do that can arguably expose a lawyer to liability."

To that end, Bienvenu's committee last year published, "Surviving a Disaster: A Lawyer's Guide to Disaster Planning" [PDF]—replete with a preparedness checklist, and tips on topics like how to develop a business continuity plan and how to protect vital records.

Earlier this month, the ABA also became the first nonprofit organization in the country to earn a disaster preparedness certification from the U.S. Department of Homeland Security. Bienvenu says the ABA hopes to share that process among members.

Now that Sandy has moved on, in-house lawyers can reflect on the continuity of legal services they've been able to provide to their clients, says Ernest Abbott, the former general counsel of the Federal Emergency Management Agency who now runs the firm FEMA Law Associates in Washington D.C.

For example, were you able to contact the members of your law department? Did you have sufficient remote access to manage the company's legal work? Abbott recommends that in-house attorneys "try and keep a list of the things they wish they had access to, that they didn't" after this latest storm hit, and then adjust their disaster plan accordingly.

As companies incur storm-related expenses, in-house counsel should also be tracking those receipts, says Williams Kastner partner Randy Aliment, immediate past chair of the ABA's Tort Trial and Insurance Practice Section. Whether it's clean-up costs or even lawyer's bills, documenting expenses now will lay the groundwork for submitting claims to an insurance carrier later on.

"If they do that, they will maximize their recovery," Aliment says.