Louisiana Tired of Lawyer Ads

Josh King

Well, or maybe business/insurance interests, a coalition of which is calling on the Louisiana Bar to crack down on “misleading” lawyer ads.

Misleading lawyer ads? That sounds bad!

Except those complaining don’t offer any specifics, pivoting seamlessly from “misleading” to the volume of lawyer ads that reach Louisianans. I mean, sure – it’s obviously a bummer when you’re just trying to run a business and your customers are constantly being reminded that they have rights and remedies. But it’s safe to say that this particular issue has been decisively settled in favor of consumers getting more information about legal services.

In an effort to ramp up the pressure, the coalition is pressing a bill through the state legislature that would require the Louisiana Bar to re-evaluate its rules governing attorney advertising.

Hey, study and re-evaluation is always good. Here’s hoping that in so doing the Bar decides that its current rules – which include an advertising review process that is both unconstitutional and anti-competitive – need to actually be simplified in the name of greater flow of information about legal services.

#newtox, and Doctors’ Social Media Disclosures

Josh King

So, plastic surgeons: they LOVE Instagram. And with good reason. While Twitter is great for conversing with other surgeons and catching up on professional news, Instagram actually has an audience of potential patients. Savvy plastic surgeons have caught on to this, and many of them are streaming before-and-after shots and candid videos on the daily.

Many of these posts promote certain treatments. That’s one thing for say, rhinoplasty, but what about branded treatments, like Botox or Coolsculpting? And what if one of those branded treatments can be viewed as sponsoring the doctor’s post?

Case in the point: the splashy launch of a new Botox competitor, Jeaveau. At a party for the brand’s advisory board in Mexico, the doctor members of the board didn’t miss the opportunity to share photos and praise with abandon. And this being Instagram, hashtags were ubiquitous, including Jeaveau’s own “#newtox.”

Now, the Federal Trade Commission has long taken issue with social media “influencers” promoting brands without disclosing they were being paid to do so (or receiving complimentary products).

But is this REALLY that sort of situation?

The purpose of the FTC’s endorsement guidelines can be roughly summed up as “consumers should know if endorsers are being paid to endorse.” But while these doctors are getting a form of compensation – their expenses to attend advisory board meetings are covered, and there are often stipends and honoraria for talks they give – they aren’t being paid to endorse. Rather, they’re being paid to advise Jeaveau’s makers and take back what they’re learned to their busy practices.

Hashtag love for #newtox? That’s just a by-product of their affection for Instagram.

Ultimately, though, while a party like this offers a crystallizing example, it’s tricky to try to unpack the relationship between doctors, brands, and the mention of branded treatments on social media. Many doctors attend multiple events, for multiple brands, every year. Nearly every doctor gets some form of free or discounted product. Should disclaimers be required in all such instances? Perhaps it’s my general distaste for disclaimers, or the fact that this isn’t some social media influencer being paid to promote a new brand of shoes. Let’s save the disclaimers for the Kardashians of the world, and let the plastic surgeons enjoy their Instagram moments.

Lying lawyers who lie

Josh King

Paul Manafort, President Donald Trump’s one-time campaign manager, has joined the growing list of Trumpelos modeling orange jumpsuits for the 2019 season. Upon Manafort’s second sentencing – he’s getting two terms, totaling out to close to a decade, for a dogs’ breakfast of financial crimes – his attorney, Kevin Downing, made a curious claim:

“Judge Jackson conceded that there was absolutely no evidence of any Russian collusion in this case. So that makes two courts. Two courts have ruled no evidence of any collusion with any Russians.”

Except that she didn’t.

Manafort wasn’t being tried for “collusion,” and Judge Jackson didn’t make any rulings regarding “collusion.” What she DID say was:

“The ‘no collusion’ refrain that runs through the entire defense memorandum is unrelated to the matter at hand.”

and

“The ‘no collusion’ mantra is simply a non sequitur.”

and

“The ‘no collusion’ mantra is also not accurate, because the investigation is still ongoing.”

Oh. That’s pretty much NOTHING LIKE ruling that there was “no Russian collusion.”

But Downing said two courts had made this determination. What did the other court say?

“He [Manafort] is not before the court for anything having to do with colluding with the Russian government to influence this election.”

Uh, right. He’s before the court for being a swindler. That doesn’t foreclose the possibility that he committed other crimes; just that he’s not being tried for other crimes right now.

It would be an insult to Downing’s intelligence to think he didn’t know the difference between a comment about the limited scope of the proceeding and a ruling, so let’s just call his statement what it is: a lie.

But is it a sanctionable lie? Should Downing’s license to practice law be in jeopardy for this statement?

Many lawyers think so, and some have already filed Bar complaints against Downing. But I think this case aptly illustrates the appropriate limits of the Bar’s ability to sanction lawyerly lies.

Like all Americans, lawyers have a First Amendment right to lie.[ref]See, for example, US v. Alvarez).[/ref] There are some conditions on this right – defamation and fraud, for example. And lawyers, as a condition of being licensed, take on a few more. But these conditions are all about ensuring the proper functioning of the judicial system – attorneys are ethically bound to duties of candor to clients, opposing parties, witnesses, and tribunals. They cannot say things – truthful or not – that materially interfere with the administration of justice in their own cases. And they can’t mislead or engage in undue suasion in attempting to acquire clients.

At most, there’s the requirement in Model Rule 8.4(c) that lawyers not:

engage in conduct involving dishonesty, fraud, deceit or misrepresentation

But that rule turns on the word “conduct,” which we know – from a whole line of “conduct-or-speech” cases I’m not getting into here[ref]Fine – Planned Parenthood v. Casey.[/ref] – is not the same as pure speech from a First Amendment perspective.

Which Downing’s statement was. Pure speech. And any application of Rule 8.4(c) to that speech would be surely unconstitutional.

Downing’s comments certainly were not admirable, praiseworthy, or wise. They were venal and pathetic. But we must think twice before summoning the awful power of government sanction against even the most ill-advised of statements. As Justice Kennedy wrote for the majority in Alvarez:

“Our constitutional tradition stands against the idea that we need Oceania’s Ministry of Truth.”

Indeed.

“Self-Defense” and Negative Online Reviews

Josh King

It seems doctors have the same blocks as lawyers when it comes to dealing with online reputational ecosystems. I can’t tell you how many times while at Avvo I heard lawyers complain about their inability to defend themselves from (surely false/scurrilous/overstated!) negative online reviews.

“I’d be revealing client confidential information,” they’d say.

“It would get me in trouble with the Bar if I set the record straight,” they’d complain.

And they’re not wrong!

For doctors, too have the same concerns. And besides professional liability, there’s the bugaboo of the HIPAA Privacy Rule, which broadly covers virtually any disclosure of private health information.  As a clinic in New York just found out – via payment of a $125,000 settlement – even disclosing protected health information that has already been publicly disclosed by the patient can lead to liability under HIPAA.

Oh, the injustice of it all! It’s enough to have some calling for a leveling of the playing field, of finding a way to give doctors a right of defense in online public forums.

But these suggestions miss the forest for the trees. For while there’s  a good argument that keeping patient or client secrets – even in the face of attack on one’s reputation – is part of the price doctors and lawyers pay for the privilege of enjoying our licensed monopolies, there’s an even more fundamental problem . . .

Arguing in public about the details of an online review is profoundly counterproductive.

No matter what the facts might be, getting down in the mud and bickering with a reviewer leaves the impression that the professional is thin-skinned, defensive, and not adequately patient- or client-focused.

This in no way means that doctors have no recourse. There are numerous strategies far more effective than “setting the record straight.” The best of these are:

  • Regularly soliciting reviews. Not only does this give you powerful market research insights, it also ensures that any negative feedback is in context with (hopefully) a wealth of positive feedback.[ref]And paradoxically, a certain amount of negative feedback can make positive feedback more credible.[/ref]
  • Responding generally. Just because you can’t argue doesn’t mean you can’t use a negative review as a mini-marketing platform. It can be tricky – you’ve got to really rise above, and resist the urge to condescend – but the payoff can be great. A simple message such as this can be highly effective at showing that a doctor is a confident professional who cares about patient outcomes:

“I’m sorry you had a bad experience. This does not sound familiar, or at all like what we expect in our practice. Please don’t hesitate to contact me directly to see how we can make things right.”

When it comes to online reviews, what’s important isn’t that you’re right, but that potential patients perceive you as the professional you (hopefully) are. So don’t fret about HIPAA keeping you from defending yourself. Focus instead on making sure your approach to online reputation is putting your practice in the best light with potential patients.

(Oh, and it doesn’t hurt to be caring, on-time, and really good at what you do as well.)

 

“DoNotPay” App Expands; Attorneys Tremble

Josh King

The “DoNotPay” app, originally launched to script people through the process of fighting traffic tickets, has vastly expanded its scope to include some 15 different areas.  DNP founder Joshua Browder has a thread on twitter running down the changes:

 
The wringing of lawyerly hands began immediately; here’s just one example:

The general themes of the complaints I’ve seen – which are very familiar from my days at Avvo – seem to be that DNP is engaged in the practice of law, consumers have no recourse when something goes wrong, and that legal issues are far too special and complicated to be left to scripting and algorithms. Let’s address.

The Practice of Law

“The practice of law” is a frustratingly ill-defined term. It is malleable enough to be wielded by lawyers in all sorts of ways to extend the legal monopoly to its broadest extent – lawyers routinely use it to exclude others from providing “legal advice.” But the rub has always been that such advice must be in the context of a client relationship of trust and reliance for it to be “the practice of law.” Attempts to take on non-specific forms of legal advice – books, articles, talks, etc. – have flailed, in several cases with settlements and legislative bailouts saving Bars from sure First Amendment losses.

Why? Because the First Amendment requires that any content-based speech restrictions (apart from a few specific categories not relevant here) survive strict scrutiny – and any limitation or sanction for publishing would be such a restriction.

(And as an aside: there’s also a good argument that the First Amendment even prohibits states from monopolizing for lawyers the sale of individualized legal advice, but I’ll stick to my central point for now.)

DNP is, for all legal purposes, a publishing exercise in that it offers generalized guidance. It doesn’t matter that this guidance is user-centric, interactive, and detailed: there is no client relationship of trust and reliance, no human intervention, no exercise of legal judgment.  There’s simply no way it meets any constitutional definition of “the practice of law.”[ref]And consider, too, one of the fundamental reasons why this matters: consumers know the difference between relying on a DIY resource – even a detailed, interactive one – and talking to a trained advisor. Their expectations are a big part of the reason why special duties attach when a client relationship of trust and reliance is created.[/ref]

Legal Recourse

Many lawyers have made much of “what happens to the poor consumers when something goes wrong? Who can they sue?”

How about nobody?

Not every injury requires a remedy. As I’ve often pointed out, consumers make price/quality trade offs all the time. And they’re making them right now in law: they’re choosing the DIY path instead of engaging with lawyers. One of the things consumers give up, when they choose to rely on books, or court forms, or something their friend’s brother’s girlfriend told them about HER legal issue, is the ability to sue someone for sending them astray with bad advice.

And that’s fine. Consumers should have the right to make this choice.

So: my answer is that while consumer protection and contract law principles could apply to tools like DoNotPay (depending on representations made by those offering such tools, or agreements they make with their users), there’s no reason to require liability as a condition of such tools existing.

[It’s also ironic that lawyers make so much of the availability of malpractice remedies when precisely ONE state (Oregon) requires that its attorneys carry malpractice insurance.]

The Specialness of Legal Issues

The final species of complaint is that legal issues are just far too complex for one-size-fits-all solutions to address. This is so frustratingly wrong it hurts. The bottom line is that most consumer legal issues are simple and straightforward, and thus CAN be met with cookie-cutter solutions, and for many of these consumers such solutions are superior to working with an attorney.[ref]Yes, exceptions abound, which is why lawyers stay employed. But letting these exceptions lead you to believe that ALL legal issues require custom advice is to succumb to a massive case of survivorship bias.[/ref]

For more detail on why this is so, read my piece on why lawyers need to embrace mediocrity, or Bill Henderson’s excellent take on consumer perspective and how expert systems – like LegalZoom – are often the optimal solution for routine legal issues.

I have no idea if DoNotPay is any good, but I applaud any and all good faith efforts to empower consumers to better address their legal needs.

And as for attorneys, I’d like to see a lot more focus on building the value proposition for hiring a lawyer (including adopting attorney-centric expert systems to better and more cost-effectively serve consumers with routine legal issues) than trying to exclude better DIY tools.

ABA Tweaks the Ad Rules

Josh King

The ABA House of Delegates has now approved a significant number of changes to the attorney advertising rules.

If I sound less than excited about that, it’s because the changes don’t amount to much. As I wrote at the beginning of the year, the amendments fail to address the litany of constitutional, antitrust, and plain bad-for-the-public problems inherent within the Rules.

The rules as adopted DID tweak the definition of “recommendation,” removing an earlier change that would have defined “recommendation” even more broadly than in the current rules. But alas, it keeps the existing definition and adds a caveat that is surely going to cause even more trouble:

A communication contains a recommendation if it endorses or vouches for a lawyer’s credentials, abilities, competence, character, or other professional qualities. Directory listings and group advertisements that list lawyers by practice area, without more, do not constitute impermissible “recommendations.”

Having been through the meat grinder of multiple Bar ethics committees trying to evaluate the “ethics” of innovative new advertising and legal services delivery models, I can guarantee you this: a whole bunch of overbroad and unconstitutional interpretations of the ad rules are going to turn on the “without more” in the comment above.

I know that many of those who pushed these changes through agree that far more change is needed (including the wholesale elimination of Rule 7.2), but believed that the path forward was through this kind of incremental change. They may well be right that this is the best path to getting the Rules where they ultimately need to be. But forgive me if I lack any enthusiasm about these amendments.

Although if anyone wants suggestions about the NEXT set of changes, I’ve already prepared a helpful list.

Supreme Court Closes in on Regulation of “Professional Speech”

Josh King

The facts that underlay NIFLA v. Becerra are ugly in a vaguely dystopian way. One one side, you’ve got “Crisis Pregnancy Centers,” outfits that reach out to pregnant women in extremis and offer them counseling and a variety of other resources. Oh, alongside a heaping helping of MY SWEET LORD JESUS and a big vacant hole where one pregnancy-resolving solution, abortion, might lie. On the other side? An overweening state government that has found a “solution” to Crisis Pregnancy Centers, and it is “force them to tell pregnant women that hey, abortion is an option – and the state might pay for it!”

So yeah: religion-fueled deception, or nanny state compulsion? Absent an uber-partisan leaning to one side or the other (a leaning that allows you to look past manipulation of the vulnerable or government-mandated ventriloquism), you’re not going to see any angels here.

However, as we’ve got expansive free speech rights here in the US of A, the balance lies heavily on the side of the bible-thumping manipulators. The “more speech” solution we’ve arrived at counts on more information in the marketplace of ideas – not the heavy hand of government intervention. And that goes for compelled speech as well. While the government can compel certain speakers to communicate all sorts of factual information (think warning signs, food labeling, some disclosure requirements), the First Amendment prevents the state from going further and requiring that speakers transmit less-factual, more-controversial messages. So it’s not surprising that California lost on this one.

What interests me about the case – and why I wrote about it when it was at the Circuit level – is the implications it has for lawyer regulation.

Implication 1: Many state bar rules contain extensive disclosure and disclaimer requirements. Some of these – such as requirements that contingent fee advertising disclose that clients may have to pay costs and court fees – are purely factual information that directly goes to the terms under which the advertised service is being offered. In these narrow circumstances, Bars have ample room to regulate. The standard under Zauderer v. Ohio is even more lax than the intermediate scrutiny applied to other forms of commercial speech regulation: such disclosure mandates will be permitted as long as they are not “unjustified or unduly burdensome.”

But as with California, some regulators have viewed this as license to impose all manner of disclaimer requirements. New Jersey requires that any comparative lawyer advertising be disclaimed with “No aspect of this advertisement has been approved by the Supreme Court of New Jersey;”[ref]New Jersey Rules of Professional Conduct 7.1(a)(3).[/ref] New York requires that that attorneys advertising that they have been certified as a specialist by another state do so only when such statement is accompanied by a disclaimer admonishing that “Certification granted by the [identify state or territory] is not recognized by any governmental authority within the State of New York.”[ref]New York Rules of Professional Conduct 7.4(c)(2).[/ref]; and Pennsylvania seems to have require disclaimers for all manner of advertising.[ref]See Pennsylvania Rules of Professional Conduct 7.2.[/ref]

A big part of the problem is that courts often miss the nuance that the lax Zauderer standard doesn’t apply to ALL compelled speech. NIFLA v. Becerra makes this explicit, pointing out unequivocally that the standard only applies to disclosure mandates limited to “purely factual and uncontroversial information about the terms under which . . . services will be available.” What’s more, the court goes on to note that even basic factual disclosures must be supported by some showing that the disclosure is necessary to remedy a “potentially real not purely hypothetical” harm.

Newsflash: many Bar disclaimer requirements go well beyond the “purely factual and uncontroversial” – and they sure as hell aren’t supported by any evidence that justifies the speech compulsion. Will this be the impetus Bars need to clean up their regulations?

Implication 2:  More interesting is the Court’s handling of “professional speech.” This category of expression is one of the few remaining holes in First Amendment jurisprudence. Despite the widespread regulation of professional speech (and consider that UPL restrictions are nothing more than a form of speech regulation), there are NO Supreme Court cases addressing how such speech can be regulated.[ref]Yes, there’s Planned Parenthood v. Casey, but that deals with informed consent requirements, which are considered “speech incidental to conduct.”[/ref] In NIFLA, the Ninth Circuit found that the notices at issue  were professional speech, and – apparently finding a new category of speech regulation – determined that such regulation must meet intermediate scrutiny.

The Supreme Court, however, wasn’t having it:

“But this Court has not recognized “professional speech” as a separate category of speech. Speech is not unprotected merely because it is uttered by “professionals.” This Court has “been reluctant to mark off new categories of speech for diminished constitutional protection.” [citations omitted]. And it has been especially reluctant to “exemp[t] a category of speech from the normal prohibition on content-based restrictions.” United States v. Alvarez, 567 U. S. 709, 722 (2012) (plurality opinion).

. . . In sum, neither California nor the Ninth Circuit has identified a persuasive reason for treating professional speech as a unique category that is exempt from ordinary First Amendment principles. We do not foreclose the possibility that some such reason exists. We need not do so because the licensed notice cannot survive even intermediate scrutiny.”

While it’s a little disappointing the Court didn’t go so far as to say “there is no First Amendment exception for professional speech,” this decision should make clear that professional speech regulation is at least subject to intermediate scrutiny. For the Bars, it’s yet another reminder of the pressing need for a more orderly, open, evidence-based, and – dare I say it? – professional regulatory process to ensure this standard can be met.

Lawyer Regulation: The Root of the Problem

Josh King1 Comment

As I’ve mentioned before, I’ve left Avvo and am planning my next move (but not before enjoying a glorious Seattle summer!). And while I don’t know whether that move will keep me in the trenches working on innovation in access to justice, I plan on staying involved in these issues.

In 10+ years at Avvo, I’ve become invested. Hell, I’ve become radicalized. I’ve seen firsthand the institutional inertia, malaise, and active hostility deployed against efforts to make our legal system more consumer-centric. So I’ve joined the board of Consumers for a Responsive Legal System in order to contribute directly, regardless of where my career takes me.

Consumers for a Responsive Legal System – or “Responsive Law,” as it’s commonly known – has long been a lonely voice advocating for the consumer when it comes to the regulation of the practice of law. But it’s a critically important voice: we lawyers enjoy self-regulation, but in our regulatory expertise we get so finely-grained and nuanced that we miss the needs of those our profession exists to serve: our clients (and those who would be our clients).

We saddle ourselves with picayune, overly-detailed restrictions on our ability to inform people about the resources available to them.

We insist on archaic, mechanistic payment rules, divorced from the reality of modern consumer finance or purchasing expectations.

We police the edges with the bogeymen of overbroad, unconstitutional, and anti-competitive ethics opinions.

And all along we claim an expansive monopoly on anything smelling like “the practice of law,” effectively foreclosing anyone else who might like to offer a better service.

Despite a decade-plus of handwringing over “access to justice,” we’ve produced little more than calls for more pro bono work. The problem isn’t getting solved until lawyers recognize the source of the problem: our own naval-gazey, lawyer-centric, system of self-regulation. We desperately need to shift the focus to what consumers want, and not be afraid to aggressively scrap those rules that aren’t helping the public.

Responsive Law is working on a variety of fronts to focus the Bars on the needs of consumers. These are messy, state-by-state discussions, and seeing real change is going to be a long slog. But it’s important work that needs to be seen through the inevitable ups and downs along the way.

If you’d like to help Responsive Law in this effort, it’s easy to make a donation here.

3 Ways to Tweak the Lawyer Regulatory Rules Now

Josh King

I’ve previously written about my “wish list” for structural change to the rules regulating the practice of law. I’ve also gone more granular on how the ABA’s proposal to modify the attorney advertising rules could be greatly improved.

There are also several other areas of the Rules of Professional Conduct that could be changed to make it easier for attorneys to innovate in the delivery of legal services.

Rule 1.15: the safekeeping property” rule

Rule 1.15 contains the lawyer trust accounting obligations. While the rule is well-intentioned, it isn’t flexible enough to account for situations where the client’s interests are already adequately protected. For example, legal fees paid by credit card: as long as those fees are earned relatively quickly, the client doesn’t gain any further protection from the trust accounting rules, as 1) the client isn’t actually “out of pocket” until the credit card grace period has run and 2) the client has recourse to the card issuer to charge back unearned fees in the event there is any dispute with the lawyer.

Getting recourse via the card issuer is a much easier, faster, and cleaner way for the client to get satisfaction than trying to proceed under the Rules. Yet Bar Committees and attorneys worry endlessly that Rule 1.15 prevents attorneys from using services that involve any form of prepayment for legal services by credit card. Why? Because the card processor or marketing intermediary may hold client funds while they are in transit to the attorney’s trust account.

As virtually all online commerce occurs via credit card, this means that all sorts of innovative consumer offerings aren’t going to get off the launching pad – for no reason other than the rigidity of a rule that offers no additional consumer protection in this setting.

This problem is vanishingly easy to solve: carve out an “intermediary exception” in Rule 1.15, or creating an exception to trust accounting for smallish payments made by credit cards (say, under $500 or $1000 – the level below which most innovative limited scope services will be sold).

Rule 5.4: protecting independent professional judgment

Rule 5.4 is effectively a conflicts-avoidance rule, designed to protect the independent professional judgment of lawyers from conflicts that might arise if third parties had a claim on a lawyer’s fees. Unfortunately, it has metastasized into a rigid rule prohibiting any form of fee splitting with non-lawyers.

I could go on at great length about the harm this causes, and the naivete of this rule, with its presumptions A) that other lawyers are somehow above pressuring each other over shared fees and B) that lawyer independence isn’t similarly threatened by the economic realities of running a law practice, regardless of the form in which bills are paid. And in a more perfect world, we would restyle this rule into less of a rigid prohibition and more of a general guideline that attorneys should resist all potential threats to their independence, regardless of the form in which such threats come calling.

Instead, I will observe that Rule 5.4 could be greatly improved by adding a simple carveout for ordinary business expenses that take the form of fee splits. The most obvious of these is credit card processing charges. Every fee paid by credit card is “split” with the card processor, as the processor’s 2-3% fee is deducted from the top before the funds are deposited in the attorney’s account. But marketing and advertising charges are increasingly likely to come out of fees as companies figure out better ways to unlock the consumer legal market by offering fixed-price services. Clients will pay for these services using credit cards, and the providers of these marketplaces – which may include private parties, courts, or bar associations – will want to be paid for generating that demand and facilitating the transaction. The easiest way to do that? Deduct that marketing fee from the legal fee paid. Again, this should be a non-event as long as the marketplace provider doesn’t interfere with the lawyer’s independent professional judgment. Here’s one potential formulation of a new exception to Rule 5.4:

(5) a lawyer or law firm may pay a portion of a legal fee to a credit card processor, group advertising provider or online platform for identifying and hiring a lawyer if the amount paid is a reasonable charge for payment processing or for administrative or marketing services, and there is no interference with the lawyer’s independence of professional judgment or with the client-lawyer relationship.

Safe Harbors

I’d rather have less-detailed rules, but to the extent states are going to have such rules, they could help their members out a lot by using safe harbors. What’s a safe harbor? In this context, it would simply be a list of state Bar-approved services. Lawyers could know that as long as the third-party marketing service they are working with is on the “approved” list, they wouldn’t have to worry about ethics compliance – at least for using the service. Safe harbors could be used for Rule 5.4, or 1.15, or even rule 7.2, for lawyer referral services.

Doing so isn’t without cost. A Bar adopting safe harbors would need to invest time in coming up with safe harbor criteria, with administering the program, and with ensuring that safe harbor lists were up-to-date. This would need to be a well-thought-out program, and the resources would need to be spent to ensure that it was running and doing the intended job. But this is the sort of process that should be well within the wheelhouse of any competent regulatory agency to build and implement.

Don’t get me wrong: I strongly believe it would be better for all concerned if the Bar regulators simply stripped the Rules down to the basics and focused on the purpose of the Rules, as I’ve suggested for rules 1.15 and 5.4 here, rather than mechanical compliance. But for those regulators who can’t get comfortable with taking such an extreme approach, adopting a “safe harbor” system is a great start that can offer the benefit of consumer-protective rules while eliminating most of the chilling effects of lawyer over-compliance.

5 Wishes For Attorney Regulation Reform

Josh King2 Comments

In early April, I left Avvo. It’s been 10 years; it’s time for something new. What that is yet . . . I don’t know. Summer is glorious in the Pacific Northwest; I’d love to take some serious time off and enjoy it with my family and friends.

So I don’t know how much more I’ll be writing here. I suspect, however, that I will stay involved in efforts to improve our legal system, regardless of where my work takes me. So with that adieu, I leave you with a brief wish list of legal reforms:

  • Change to “Principles-Based” Regulation.  The American system of attorney regulation is rules-based: read the rules, comply with the rules. Such a system that has the advantage of clarity, but it’s a poor system for attorneys. It’s brittle. It’s non-responsive to changes in the environment. It focuses on detail (and “creative compliance”) at the expense of the purpose underlying each rule. And it makes innovation hard. Why not adopt the example of our cousins in the UK and move to a system of principles-based regulation? Let’s re-write the Model Rules to focus on desired outcomes, rather than rigid rules, and let attorneys and firms figure out the best ways to achieve those outcomes. We might be surprised the extent to which such a system would elevate the profession to a place where the focus is back on achieving the best outcomes for clients, rather than mere “compliance.”
  • Allow Non-Lawyer Ownership of Law Firms. Law firms are starved of investment – and the innovative thinking that would happen if smart non-lawyers could be invested in the success of those firms – by the flat-out bans on non-lawyer investment in, and ownership of, law firms.  Enough with the hand-wringing about the “uniqueness of the profession” and “corporate profiteering.” Law is already a business, and we are deluding ourselves if we think that attorneys are immune from the pressures of the bottom line. It would be easy to build client protection measures into such a system. And let’s be honest: well-run corporate businesses, with transparent practices and high levels of accessibility, would provide better, more predictable, more responsive, and less conflicted service than most lawyers and law firms right out of the gate.
  • Scale Back the Definition of “The Practice of Law.” Along with allowing non-lawyer ownership of law firms, we should dispense with the field-grabbing maneuver of claiming that everything remotely “legal” is “the practice of law,” and thus can only be handled by licensed attorneys. Let lawyers practice at the top of their licenses, and let everyone else – so long as they aren’t “holding out” as attorneys – be free to dispense legal advice, even to paying customers. There’s a decent chance the Supreme Court will dictate this result within the next few years anyway,[ref]There is a very good argument that telling non-lawyers they are barred from giving legal advice violates the First Amendment, and cases – including this one – challenging limitations on “paid professional speech” are working their way through the courts.[/ref] so some enterprising Bar should just get out in front of this sea change that’s coming.[ref]Also worth noting: the legal monopoly in the UK doesn’t include legal advice; yet things seem to be working tolerably well there.[/ref]
  • Fix Multi-Jurisdictional Practice. My great-grandfather was a lawyer in Indiana. He abruptly moved his family to Tulsa in 1921, arriving just as race riots roiled that city. He had to start his practice over in a new state, but state-based attorney licensing made sense at that time – and certainly up to, and beyond, his retirement decades later. Most attorneys, including great-granddad, worked in wide-ranging, intensely local practices. But in modern society, it’s the rare lawyer who isn’t focused on a narrow area of law. Those narrow areas often span multiple geographies. So why persist in the fiction that general facility with a state’s law – as tested on a single occasion – is a necessary prerequisite to practice law in that state? Why not have admission at the national level, handle discipline at the state level, and control – via more frequent and specific tests – admission to practice before local courts? Doing so would far better police the point where failure to understand the local rules can do the most harm to clients (representation in court), while freeing lawyers (and the clients they would serve) from the arbitrariness of state MJP restrictions.
  • Create Meaningful Regulatory Processes.  Administrative agencies drive a gigantic body of the law – just look at the Code of Federal Regulations.  Non-legislative in nature, administrative rules are nonetheless adopted under a well-developed body of processes and norms.  While this process differs slightly from agency to agency, it is marked by transparency, opportunity for public comment, and responsiveness.  Notices of Proposed Rulemaking are promulgated, and orders imposing new or amended rules offer detailed descriptions of how any serious comments received were addressed. Nothing of the type pertains in lawyer regulatory processes. Supreme Courts treat lawyer regulation as just another adversary process – often freezing non-lawyers out. Publicity, notice, and transparency? Typically non-existent. And even the most well-intentioned regulators inevitably get hung up on a decision-making process that gives interested market participants (who often have the scantest sense of their regulatory obligations) veto power.  If the legal industry is going to maintain self-regulation, it needs to start doing so in a much more serious and neutral fashion.

Many lawyers would regard these as radical changes. But they really aren’t: they are a mix of approaches proven elsewhere and straightforward fixes for obvious regulatory failings. Unfortunately, our profession strongly prefers incremental approaches to anything that smells of “change” – that’s one reason we’ve got the creaky assemblage of Rules of Professional Conduct lawyers are saddled with. If the profession is to adapt and best serve the public, it’s got to do more than just tidy things around the edges. I offer my “wish list” as a modest starting point for that discussion.