Pitfalls of E-Signatures

Many professionals are transitioning from paper to electronic files.  As a result, professionals tend to rely more heavily on electronic signatures.  However, professionals must be cautious that e-signature technology does not violate any requirement to maintain traditional signatures with official filings.

Last week, a California bankruptcy judge issued sanctions against an attorney who used DocuSign technology to sign documents in a Chapter 7 bankruptcy proceeding.  The Bankruptcy Judge admonished the attorney for failure to retain original ink signatures for all electronically-filed documents in accordance with local bankruptcy rules.  The court stated that this requirement helps to ensure the authenticity of documents filed with the court, and rejected the attorney’s argument that DocuSign documents were equivalent to an original ink signature.

The court continued that software-generated electronic signatures may have a place in certain commercial transactions, but that they are not a substitute for original signatures in bankruptcy proceedings.  In order to prevent any future errors, the court ordered the attorney to attend a training course on electronic filings.

Keeping up to date with technological advances is essential to the success of any professional practice.  However, as professionals incorporate new technologies into their practices, they must ensure that the new methods of practice do not compromise any ethical obligations or violate any rules of conduct.  Professionals who use new technology as a substitute for traditional requirements, without proper authority, could expose themselves to costly sanctions.