Understanding Technology and the Law to Increase Lawyer

Understanding Technology and the Law to Increase Lawyer Agility, Reduce Administrative time, and Reduce Cost -- Presentation by Zafar Khan Chief Executive Officer of RPost www. rpost. com Confidential

What is Your Highest Priority Today? q Reduce cost to corporation q Reduce risk and e-discovery costs q Sign contracts electronically q Increase agility/efficiency q Deploy low-cost service solutions (pay-asyou-go) q Engage in “green” paper reduction initiatives 2 RPost Confidential 2

Agenda q General Correspondence q E-mail records management: common pitfalls q Ensure admissibility of e-mail into evidence q Authentication challenges often overlooked q Proof of Notice without Fed. Ex, Fax, Certified Mail Cost/Time q Substantive law – key concepts q Contract Notice Provisions q Updating to include e-mail notice q Closing Deals Faster q Electronic Contract Execution to Increase Agility for Clients q Reducing E-mail Overload q Cost-Allocation to Postal Budget as Cost Savings 3 q Matter-Centric Records Management RPost Confidential 3

RPost® at a Glance Customers include… U. S. Government Accountability Office (since 2003) Greenberg Traurig (since 2004): global law firm Macquarie Bank (since 2005): global investment bank NYSE Euronext (since 2007): global financial exchange United Nations’ World Intellectual Property Organization Aon (since 2008): world’s largest insurance broker Tata Communications; Cox Communications (since 2008) Eurocopter’s NHI (since 2008) Distributors/Partners: Pitney Bowes, AT&T, Orange (France. Tel), Google/Postini… Endorsed/sponsored: 20 major bar association. Bars of NY City, Chicago, DC, LA Safeguard for e-discovery rules: Endorsed by Risk & Insurance Mgmt Society Awards: e. Week top 10 disrupters for storage technologies 2008 IBM Best Messaging & Collaboration Tool 2007 (top 3) Shareholders: Symantec (Norton Anti-virus) & other private 4 RPost Confidential 4

Market Acceptance: RPost Partners Registered E-mail® is recognized as Legal Proof® for Internet e-mail by more than 20 major bar and law associations. CITY BARS COUNTY BARS STATE BARS New York City Chicago Boston District of Columbia Denver Atlanta Cincinnati Cleveland Los Angeles County King County (Seattle) Clark County (Las Vegas) Maricopa County (Phoenix) Hennepin County (Minneapolis) Fayette County (Lexington, KY) Westchester County (New York) New Mexico Colorado Virginia Hawaii Utah Puerto Rico* 5 *Puerto Rico is not one of the fifty US states RPost Confidential 5

E-mail Records Management Pitfalls PROBLEM Think You’re Protected? Think Again. What your users believe vs. reality when it comes to e-mail… 6 RPost Confidential 6

Disputes Do Happen… E-mail Disputes -Poll results: 23% of counsel, 40% of insurance brokers polled confirmed disputes where delivery/content of e-mail central. Legal Precedent - Arkansas Case: “RPost increased the credibility of my e-mail evidence and persuaded the judge to reject my opponent's unregistered e-mails when the integrity of his e-mail evidence was challenged. ” - Desiree Petersen, Benton County, AR 7 RPost Confidential 7

Reality: Bounce Notice Myth: q I did not get a bounce notice, so I know it got there. Reality: Most recipient servers turn off bounce notices due to abuse by spammers. Therefore, no bounce notice certainly DOES NOT mean delivery. 8 RPost Confidential 8

Reality: Internal vs. Internet E-mail Myth: q I copied myself, got the copy – so I know it was delivered. Reality: Internal e-mail within the organization does not prove the e-mail got to the Internet – and certainly does not prove delivery. 9 RPost Confidential 9

Reality: Printed E-mail ≠ Admissibility Myth: q I copy my assistant and he/she prints a copy for the file. Reality: A printed e-mail (sent folder, inbox) can easily be denied admission into evidence by simply challenging content authenticity, time of sending, whether delivered… Changing e-mail records can be as simple as editing the message and saving – just 2 mouse-clicks! Did you know that you often can easily: § Change text in any received e-mail? § Change the “from” address? § Change anything in the attachment? § Move e-mail to any folder? § Change the “time sent”? 10 RPost Confidential 10

Reality: Read Receipts Myth: q I requested a read receipt so I will know when they get it. Reality: Read receipts have little value. q They are simple text files that can be easily forged. q They tell nothing about content received. q The recipient can opt not to return the receipt. Outlook Read Receipt and Settings 11 LE IMP T. S X E OOF T PR F NO RPost Confidential O NT 11

Reality: Archive is < ½ the Picture Myth: q I save everything in my archive. I can prove that they got it. Reality: Your archive gives you a record of what content you CLAIM to have sent, but not what was actually received, whether, or when it was received. 12 RPost Confidential 12

Educate: Simple to Deny or Discredit q Because not all business e-mail is delivered, the “I didn’t get that e-mail” excuse is often used – or over used to avoid responsibility. q Litigators can simply point to public research… “ 3% of non -bulk, business-to-business Internet email goes undelivered to its intended recipient. ” – Ferris Research q By bringing into question the completeness or validity of your records, admission into evidence can easily be denied. Landmark case: Lorraine v. Markel American Ins. Co. PWG 06 -1893 (D. Md. 2007) *Ferris Research estimates that around 3% of non-bulk, business-to-business Internet email goes undelivered to its intended recipient. The two main reasons for non-delivery are legitimate messages wrongly identified as spam -- "false positives" -- and email sent to mistyped addresses and those that no longer exist. ("Business-to-business Internet email" is mail sent from one corporate email system to another via the Internet, not including mail to consumers, nor mail that remains inside an organization's private system. "Non-bulk" means that this statistic ignores legitimate bulk mail, such as opt-in direct marketing and newsletters. ) RPost Confidential 13 13

Missing Link q In the past… - We would use Fed. Ex and file the delivery receipts with the original - We would send by fax and staple the fax log to the original file copy q Today… - We are sending as PDF letters attached to e-mail - We have no proof of the transmission q Either we were wrong all those years saving the Fed. Ex receipts and fax logs, or we are missing something today as we move to PDF letters attached to e-mail. 14 RPost Confidential 14

In the Words of a Trial Lawyer… "Across the board – particularly in the legal sector and in litigation correspondence -- we are seeing a dramatic increase in the use of e-mail to send PDF letters -- with no way to prove receipt by the opposing party. This is like faxing letters and not keeping a log that the fax was received by the other side -- unacceptable for most. With this common practice, we are exposed. We will be using RPost’s Registered E-mail service to send out all PDF letters by e-mail for this reason. Now that RPost has included a one-click convert-to. PDF option within its Registered E-mail service, our lawyers can 'Send Registered', convert to PDF, and receive proof of delivery with as little as two extra clicks. ” - Stan Gibson, trial attorney and partner at Jeffer Mangels. (Jeffer Mangels Butler & Marmaro LLP, one of California’s foremost full-service law firms, enables RPost’s Registered E-mail services for all litigation, real estate and corporate lawyers. ) . 15 RPost Confidential 15

Take-Away THE NEW REQUIREMENT Court Admissible Records 16 RPost Confidential 16

Landmark Case Law RPost “Legal Proof” records map to evidence admissibility requirements. (Case summary available upon request) Lorraine v. Markel American Ins. Co. PWG-06 -1893 (D. Md. 2007) (101 pages) D N RE T q Coverage dispute. Dispute involved question of whether lightning had caused damage to Lorraine’s property q Parties attached primarily emails and attachments to motion for summary judgment but Federal Court denied motions on the basis that neither party laid proper foundation for admission of email on motion q Court wrote 100 page opinion about admission of email evidence – making this a landmark case 17 RPost Confidential 17

Key Concepts Relating to E-mail Lorraine v. Markel: Admissibility Summary - Authenticate transaction metadata Analysis of metadata - sent vs. received Authenticate message content associated with metadata Uniform time associated with sending and receiving 18 RPost Confidential 18

Take-Away THE CHALLENGES Self Authentication vs. System Authentication 19 RPost Confidential 19

Over Time, the Parade of Horribles Enters Any Fortress of Technology 1. Denial by recipient 2. Changing technology 3. System upgrades 4. Mergers, acquisitions, divestitures 5. New outsider threats creating new insider threats 6. Inadequate time to propagate changes across networks 7. Unauthorized access to private keys 8. Loss of metadata in retention systems 20 RPost Confidential 20

Preservation Obligations and Metadata q Preserving an e-mail or e-document against tampering may simultaneously remove metadata or may omit the transaction meta-data (information that attests to time sent and received) q Preserving the metadata may be unnecessary, but the destruction of the metadata must be assessed. We have seen this in many e-mail archiving programs that neglect the need to prove what content was sent and received by whom and when. q System metadata may be unreliable, cannot easily be proven to be associated with email content, and may not be retained beyond a few days -- but when relevant it must be preserved, capable of authentication, and may need to be produced and validated. 21 RPost Confidential 21

Case Law Update: Downgrades of ESI Very Risky q Compare Quinby v. West. LB AG, 2006 WL 2597900 (S. D. N. Y. Sept. 5, 2006): § Court affirmed decision denying sanctions on party for moving email from active media to backup media, but declined to shift the costs of restoring email from the inaccessible media after the duty to preserve had attached. q With Treppel v. Biovail, 233 F. R. D 363 (S. D. N. Y. Feb. 6, 2006): § Magistrate Judge expressly disagreed with the decision in Quinby, reasoning that “conduct that hinders access to relevant information is sanctionable, even if it does not result in the loss or destruction of evidence. ” § Court held that “the downgrading of data to a less accessible form – which systematically hinders future discovery by making the recovery of the information more costly and burdensome – is a violation of the preservation obligation. ” q AAB Joint Venture v. United States, 75 Fed. Cl. 432 (Fed. Cl. 2007): 22 RPost Confidential 22

Case Study #1 q Recipient claims non receipt of business critical e-mail 1. Sender calls IT to find out what happened 2. IT researches and reviews server logs that show something was transmitted that appears to reference the message in question. 3. IT reports that the message was SENT (note, not received) 4. Sender calls recipient, declares message was SENT, that recipient must have it. 5. Recipient re-affirms that they did not get the e-mail in question. Recipient contacts their IT department, which re-affirms that they did not receive it. q Now what? (mistrust begins) q How does the sender make their record portable, durable, proof? 23 RPost Confidential 23

Case Study #1 q What if the e-mail in question was “sent” months or years ago? q How does this scenario change if the metadata was available? q If the metadata (in this case, SMTP logs) are available… How does one present this to the other party in a manner that will withstand claims of alteration after the fact or questions about associated message content? Simple text server log that can be altered 24 RPost Confidential 24

The Origin of Mistrust Often one party sends and e-mail; the other party does not receive it. Who is right Internet SENDER: Compose and Send E-mail ‘vanishes’ in the Internet Possible issues/problems • Receiver’s mailbox full • Bad address • Sender network • Sender ISP/ESP/MSP • Receiver network • Receiver ISP/ESP/MSP • Receiver spam filter • Receiver virus filter • Many more RECIPIENT: Never Received *Ferris Research estimates that around 3% of non-bulk, business-to-business Internet email goes undelivered to its intended recipient. The two main reasons for non-delivery are legitimate messages wrongly identified as spam -- "false positives" -- and email sent to mistyped addresses and those that no longer exist. ("Business-to-business Internet email" is mail sent from one corporate email system to another via the Internet, not including mail to consumers, nor mail that remains inside an organization's private system. 25 "Non-bulk" means that this statistic ignores legitimate bulk mail, such as opt-in direct marketing and newsletters. ) RPost Confidential 25

Take-Away PROOF OF NOTICE Without Fed. Ex, Fax, Certified Mail Cost/Time 26 RPost Confidential 26

PROOF OF NOTICE RPost® Registered E-mail® Used Daily by Leading US & International Law, Insurance & Government Organizations for Legal Proof® of E-mail: verifiable record of e-mail content, delivery and official time stamp. 27 RPost Confidential 27

Simple to Use: Desktop Installation 28 RPost Confidential 28

Recipient Needs Nothing Special 29 RPost Confidential 29

Evidentiary Record as Outlined in Case Sender’s Computer Online Proof Archive or DM system A. Transaction meta-data B. Interpretation of transaction data C. Self contained – RPost stores no data D. Authentication process 30 RPost Confidential 30

Registered Receipt Breakdown RPost records the delivery audit trail or transaction metadata. This is a recording of the SMTP and ESMTP dialogue as a statement of fact. Registered Receipt 31 RPost Confidential 31

Registered Receipt Breakdown RPost created a library of algorithms that translates the server dialogue so the sender knows the delivery status without having to contact the Help Desk or IT department. Registered E-mail Traditional Mail Carrier ® Legally Delivered þ Opened þ Mailbox þ Mail Server ý Failure = Recipient signature = Assistant signature, put on desk = Mail Room attendant signature = No one signs for it Registered Receipt 32 RPost Confidential 32

Registered Receipt Breakdown The Registered Receipt is a self-contained and self authentication e-mail. Attached is a “Locked” file containing the original e-mail and attachments, audit trail, delivery information and times. This information is embedded with the receipt so RPost nor any other third party needs to retain a copy of the e-mail or attachments. Registered Receipt 33 RPost Confidential 33

Registered Receipt Breakdown In the event of a dispute involving e-mail the sender may verify the Registered Receipt e-mail at any time, at no cost and without setting up any accounts. The sender simply forwards the receipt to the opposing party and they can forward it to the verification address for authentication. Registered Receipt 34 RPost Confidential 34

Take-Away LEGAL PROOF® Full legal opinions available upon request to info@rpost. com q Locke Lord Bissell & Liddell LLP – 29 pages q Nelson Mullins Riley & Scarborough LLP – 8 pages q European opinion by author of British Standards Institute code of practice on E-mail Evidence & Admissibility. 35 RPost Confidential 35

Self-Authentication in Case Challenged Self-authentication overcomes attempt to “disprove” or deny by recipient. Simple…compared to system-wide integrity analyses. In case of a dispute, Registered E-mail® receipts can regenerate transmission data, delivery status as well as re-present the original email WITHOUT storing the original on its network. As required in the Lorraine v Markel case 36 RPost Confidential 36

In Summary: LEGAL PROOF® is… RPost provides Legal Proof® core service. What is “Legal Proof”? q Verifiable record of delivery of e-mail as defined by the law (UETA) q Verifiable record of content (message body/attachments) delivered q Verifiable record of uniform time sent and received …verifiable in a manner that constitutes “proof” q Self-authenticating q Withstanding challenges around admission into evidence 37 RPost Confidential 37

LEGAL PROOF® 38 RPost Confidential 38

Legal Opinion: Locke Lord Bissell This legal review presents the following conclusions as to this Registered E-mail® service: (1) DELIVERY PROOF: RPost’s Registered E-mail® service provides a record of sending and receiving in accordance with the Uniform Electronic Transactions Act (UETA) by recording the recipient’s server’s receipt thereof; (2) CONTENT PROOF: The encryption and tamper-detectability of RPost’s Registered Email ® service preserves the contents of emails and their attachments so as to satisfy process requirements designed under UETA or the Electronic Signatures in Global and National Commerce Act (ESIGN) and evidence law and to establish evidence of content; (3) OFFICIAL TIME STAMP: RPost’s link to a trusted and objective time source provides essential and credible evidence in disputes in which the time an email was sent or received is material to the case; (4) ADMISSIBLE EVIDENCE: RPost’s Registered E-mail® service receipts are admissible as to their fact of delivery, as to their legal time of delivery and as to the authenticity of their content; (5) FUNCTIONAL EQUIVALENCE: RPost’s Registered E-mail® service, under UETA and ESIGN, can serve as the functional equivalent of paper mail, to be used in lieu of certified mail, registered mail, return receipt mail, private express mail services, fax logs and similar types of paper mail services. 39 RPost Confidential 39

CONTRACT NOTICE All written notices, demands, or requests of any kind must be given by PROVISION government postal service certified mail return receipt requested service, UPS, Fed. Ex, or comparable global courier mail with signature required, by RPost’s Registered E-mail service, or by personal service with signature required, and shall be deemed effective on the day on which a delivery receipt has been signed by the authorized agent of the recipient for government postal service certified mail return receipt requested service, UPS, Fed. Ex, or comparable global courier mail with signature required, or personal service, or at the sender’s local time on which RPost’s Registered Receipt e-mail indicates that the authorized electronic mail agent of the recipient has accepted the Registered E-mail message with the delivery status of at least delivered to mail server. Notices shall be delivered to the parties at their specified addresses set forth in this agreement or otherwise provided by the parties for contract-related correspondence, or at such others as may be 40 RPost Confidential 40

CONTRACT EXECUTION CLOSING DEALS FASTER Electronic Contract Execution to Increase Agility for Clients 41 RPost Confidential 41

Digital vs. Electronic Signature Digital Signature: Cryptographic tools used to ensure or verify the integrity of a document or e-mail. (UETA) Electronic Signature: an electronic sound, symbol, or process, attached to or logically associated with a record, and executed or adopted by a person with the intent to sign the record. (ESIGN) RPost’s e. Sign. Off™: combines both digital and electronic signature techniques to provide a signed contract with the legal and functional equivalence of a “wet-ink” signature. 42 RPost Confidential 42

E-Signature / E-Records Cases q Sims v. Stapleton Realty, Ltd. , 2007 Wisc. App. LEXIS 741 (Aug. 23, 07) - an agreement originally in paper can be amended by a party using email. q Kloian v. Domino’s Pizza , 733 N. W. 2 d 766 (Mich. App. 2006) - two parties can reach a legally binding agreement using email; if a law other than an electronic signature law requires extra steps for an electronic record or electronic signature to be effective (such as a certain placement of a signature or method of delivery), that other law must also be complied with. q Bell v. Hollywood Ent. Corp. , 2006 Ohio App. LEXIS 3950 (2006) - plaintiff found to have consented to arbitration process by electronically signing web-based job application. q Verizon Communications, Inc. v. Pizzirani, 2006 U. S. Dist. LEXIS 81688 (E. D. Pa. 2006) – defendant by clicking “I ACKNOWLEDGE” electronically agreed to non-compete as 43 RPost Confidential 43

ONE-CLICK E-SIGNOFF ENTIRELY BY E-MAIL (NO LINKS TO WEBPAGES) 44 RPost Confidential 44

SENDING for e. Sign. Off™ Feature Pop-up with agreement text 45 RPost Confidential 45

RECEIVING Contract for Signature Original Contract Original E-mail Instructions Typed by Sender Standard Signing Instructions Signing Action 1 46 RPost Confidential 46

E-SIGNING Signing Action 2 Automatically inserted pre-set agreement text - Signed with Effective Electronic Signature of Recipient - Legal definition of “Electronic signature”: a. an electronic sound, symbol, or process, b. attached to or logically associated with a record, and c. executed or adopted by a person with the intent to sign the record. 47 RPost Confidential 47

Process Flow Chart One-click sign-off of agreements by e-mail - Legally equivalent to “wet-ink” signature Internet Sender e. Sign. Off Recipient 1. Compose 2. Read & Sign 3. Signed Copy Signing, stamping and sealing the original e-mail and attachment(s) PDF contract attached has Digital Seal® integrity and time verification Sender’s Inbox & Company Archive Receive a Registered Receipt e-mail containing the verifiable record of the original e-mail and signed reply (proof of delivery, content and time) 48 RPost Confidential 48

RECORD of Legal Agreement Signed Contract (details next page) e. Sign. Off E-mail Integrity Proof by Digital Signature of Record Processor (RPost) “Digital signature” means a type of electronic signature consisting of a transformation of an electronic message using an asymmetric crypto system such that a person having the initial message and the signer’s public key can accurately determine whether: (A) The transformation was created using the private key that corresponds to the signer’s public key; (B) The initial message has not been altered since the transformation was made. 49 RPost Confidential 49

RECORD as a Verifiable PDF Signed Contract: Recipient’s E-signature 50 RPost Confidential 50

RECORD as a Verifiable PDF Original E-mail Body & Sender’s Instructions 51 RPost Confidential 51

RECORD of Original Contract Digitally Signed with a SHA 1 RSA Certificate Signed Contract: Page 1 52 RPost Confidential 52

DIGITAL SEAL® on Original Contract Signed Contract: Page 2 53 RPost Confidential 53

Transaction Proof Record An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable. RPost records show underlying transaction metadata for delivery to the specific mailbox. An authorized user will have access to mailboxes via standard password protection. Original e-mail and attachments Delivery Status Transmission Details Attachment Information Transaction Metadata (delivery audit trail) 54 RPost Confidential 54

Optional Countersignature PDF is both Digitally Signed (using PKI digital signatures and sealed with RPost’s Digital Seal™ protection, which is a form of digital signature that allows the original sender to countersign a contract when used with the e. Sign. Off service. Any future recipient can verify the integrity and authorship of the e-mail and attachments. It is as legally enforceable and legally effective as a "wet ink' signature protecting the sender against hoaxes, misrepresentation or imposture. Signed and countersigned contract Recipient Signature (wet signature equivalent on every page of the PDF) 55 Sender Signature RPost Confidential 55

Customer Use of e. Sign. Off™ Service Cox Communications (Third largest cable provider and seventh largest Telco in the US) National sales managers Monthly fixed seat/user license e. Sign. Off™: Electronic contracting for business customer contracts "Cox Business’ move to electronic contracting eliminates complexity for our customers and allows them to be more productive by enabling an inexpensive single-click, close-by-e-mail solution. ” Bob Hattori, vice president of operations, Cox Business. 56 RPost Confidential 56

Cost Savings for Entire Company One-click proof of notice by e-mail -- functionally equivalent to certified/registered mail (legal opinion available) Avg. Cost of Sending 100 Documents § Cost reduction § Risk reduction § Time savings § Speed in transactions § Reduced storage Method Rate + Sending Certificate Delivery Receipt Proof content $ Total Fed-Ex / UPS 15 -40+ Included Impossible > 20 7 & postage Included $0. 85 Impossible > 8 0. 39 Included Registered Mail Registered E-mail® 57 0. 39* * For volumes of 25, 000 per month or more RPost Confidential 57

SIDENOTE REDUCE E-MAIL OVERLOAD TO SAVE ADMINISTRATIVE TIME 58 RPost Confidential 58

Side. Note™ Reduces E-mail Overload [ ] 59 RPost Confidential 59

Side. Note™ Service: How it Works “To” Recipient sees only original message without the sender’s special annotated side-message. 60 RPost Confidential 60

Side. Note™ Service: How it Works “Cc” and “Bcc” Side. Note™ Recipients see separate Side. Note message above original message, adding context for copied recipients. 61 RPost Confidential 61

COST RECOVERY // AUTO BILL-BACK REDUCE OTHER SOFTWARE LICENSES COST ALLOCATE TO POSTAGE BILL-BACK IN CERTIFIED MAIL CATEGORY 62 RPost Confidential 62

Product Transformation: Single Service to Platform All Inclusive - On Demand - One Service - Legal Proof® Prove - Registered E-mail to prove message delivery and content - Verify time with official timestamp - Self-authenticate e-mail records in minutes Sign - Sender signs - Recipient signs off - Sender and receiver both sign - Sign, and time seal and convert signed contract record to PDF Core Service Registered E-mail® Continuous Innovation Secure - End-to-end encrypt without any links or click-throughs…right to the recipient inbox - Metadata scrubbing en route - Convert to PDF with one click Record - Classify & categorize messages for cost accounting or e-discovery - Store verifiable e-mail records in a secure, web-accessible archive Collaborate - Include private notes to add context for cc and bcc e-mail recipients - Record back-and-forth communications with recipient 63 RPost Confidential 63

RPost “Send Menu” – Options All. Inclusive “Send Registered™” Feature Menu Includes 1 -click encryption option Includes 1 -click e-sign option Includes 1 -click PDF-conversion 64 RPost Confidential 64

Lawyer Agility 1. PROOF OF DELIVERY TO REGULATORY AGENCIES 2. PROOF OF NOTICE (contractual, by-law, regulated…) 3. ONE-CLICK ELECTRONIC SIGNOFF (contracts, proxy…) 4. REDUCE RISK OF DISCREPANCY ON WHO SAID WHAT TO WHOM BY E-MAIL 5. SIMPLIFY RECORDS RETENTION POLICIES 6. REDUCE OVERALL E-MAIL VOLUMES 65 RPost Confidential 65

Questions? Zafar Khan Chief Executive Officer RPost 310 -342 -0088 zkhan@rpost. com www. rpost. com 66 RPost Confidential 66