A recent federal case out of New York provides an interesting look at a subject I’ve written about a number of times: what, exactly, IS “the practice of law?”
It’s a deceptively simple question. For many lawyers, the answer is “anything I work on that’s related to the law.”
And even some federal judges: to whit, the 2014 district court decision in Lola v. Skadden, Arps et al, in which the judge concluded that a lawyer hired to do $25-per-hour document review was practicing law, and thus not eligible to be paid at the overtime rate.
In the district court decision, the court spends a fair bit of time parsing what “the practice of law” means, arriving at a broad definition that draws in a wide range of legal tasks, including many that involve “little to no legal judgment” – like in case of the lawsuit Xarelto.
As I’ve pointed out before, there’s a fair bit of tension between the First Amendment and expansive regulation of “the practice of law.” And although such expression-related concerns aren’t at play in a putative class action claim for document review lawyers to get paid overtime, this fundamental limitation on the state’s right to control expressive activity should inform how courts determine the contours of “the practice of law.”
What would those contours look like? My developing thought is that they should look considerably narrower than what most lawyers think of as the “practice of law.” The state’s legitimate interest in protecting consumers and preserving the unique lawyer-client relationship doesn’t need to cover nearly as much ground as the bar has claimed over the years.
So it was refreshing to see the 2nd Circuit reverse the district court decision in Lola v. Skadden, and find that the document review activities alleged in the plaintiff’s case were NOT “the practice of law.”
Why not? Although North Carolina (the state in which the issue arose) – like many states – provides a less-than-helpful definition of “the practice of law,” the Circuit court reviewed a number of decisions dealing with the issue, in North Carolina and beyond, to arrive at the conclusion that “the practice of law” requires the exercise of legal judgment on behalf of a client. And in this case, the quintessential document review activity of “using criteria developed by others to simply sort documents into different categories” did not involve the exercise of legal judgment.
That seems, to me, to be a good thing. Not everything a lawyer does – even “lawyerly-seeming” stuff – is actually “the practice of law,” subject to state regulation and limitation.
This doesn’t mean, of course, that a lawyer is off the hook for client-impacting problems that arise out of activities that don’t fall under the definition of “the practice of law.” What it DOES mean is that there are appropriate limits on the extent to which the state can call an activity “the practice of law” and proceed to regulate it.
In the case of David Lola, that means time-and-a-half pay for extra hours of document review. For everyone else, it may eventually mean greater access to everyday legal help.
[In Part 2, a look at another recent decision that cuts the other way]