Article on the ethical implications of artificial intelligence in the practice of law

Above the law has posted a very informative article on the ethical implications of the use of artificial intelligence in the practice of law.  You can read it here.

Artificial intelligence and the practice of law

Here is a video of a "webinar" on how artificial intelligence is affecting and will continue to affect the practice of law.  If you don't see the video below, you can go watch it here.

Illinois disciplinary agency publishes comprehensive report recommending changes to the rules and the creation of a new regulatory system to allow lawyers to participate in for profit referral services and other "matching" services

A couple of weeks ago I participated in a panel on the debate over for-profit services that help “match” potential clients with lawyers who are looking for clients such as Avvo Legal Services.  As long time readers of this blog know, this is a topic I have been writing about for some time.  (To see my previous posts on the subject, go here and scroll down.)  To see an article I wrote on the subject go here.  (An update to this article with more recent developments since its publication is forthcoming.)

As I have chronicled here and elsewhere, all of the published opinions, and one proposed opinion have concluded that participating in for profit matching services such as Avvo Legal Services would violate, or likely violate, rules of professional conduct.  Only one proposed opinion has suggested the opposite.  Having said that, it should be noted that the vast majority of jurisdictions have not published any opinions on the subject which may mean that the regulators don’t see the question as a problem that needs to be addressed. Also, California allows for profit referral services, while others may not allow them, but seem to tolerate them.

Given the state of affairs, in some of my writings about this topic I have suggested that Avvo would be better served by seeking to get jurisdictions to change the rules so it would be allowed to do what it wants to do (rather than argue that what it is doing was not against the rules - a battle it seems to be losing.)

Which brings me to today’s news: the day before I spoke at the conference, the Illinois Attorney Registration and Disciplinary Commission (ARDC) published the most comprehensive report on this issue in which it suggests amendments to the Illinois rules of professional conduct in order to allow attorneys’ participation in for-profit referral services such as Avvo Legal Services.

In doing so, it is the first jurisdiction to publish such a recommendation.  (North Carolina has been considering one, but it has not been officially published yet.)

The report, which you can find here, is very comprehensive (124 pages long) and I have not had a chance to read it all, but I looked at some sections and here is a quick review.

First of all, it should be noted that the report is just that; a report.  It is not a final recommendation or a decision of any sort.  And it is subject to changes since the ARDC is now seeking comments on it.  But it does have suggestions on how to approach the issues.

Second, given those suggestions, it is clear that the report sides with what I have called the “Justice gap” theme in the debate.  [See, "Justice Gap vs. Core Values: The Common Themes in the Innovation Debate" 41 Journal of the Legal Profession 1 (2016)]  This refers to the position that we should do what we can to help provide more access to legal services, even if doing so involves taking innovative approaches that seem to go against tradition.  As the report states, “[p]rohibiting lawyers from participating in or sharing fees with for-profit services that refer clients to or match clients with participating lawyers is not a viable approach, because the prohibition would perpetuate the lack of access to the legal marketplace.”

What is new, and may be controversial, in the report is that it does not only suggest changing the rules that apply to lawyers, it suggests creating a regulatory system to apply to the non-lawyers who want to provide for-profit referral services that would require them to meet certain standards and to register with, and be regulated by, the ARDC.  According to the report, this approach would be better to protect clients and the integrity of the legal profession.

The ARDC will accept comments through at least Aug. 31, 2018. Comments should be sent to information@ardc.org.  More here.

As expected, the report has generated some debate already.  Here are some links to comments about it.

Carolyn Elefant writes that the proposal is a very bad idea, but not for the reasons that the jurisdictions that have published opinions have argued.

Law Sites describes the report here.

Legal Profession blog comments here.

Robert Ambrogi comments on the report at Above the Law.

Finally, here is a podcast discussing the report with its author.  (if you can't see the podcast play button below, you can go here to access it.)

NJ Supreme Court rejects request to review opinion on Avvo legal services -- UPDATED

About year ago, the Advisory Committee on Professional Ethics, the Committee on Attorney Advertising, and the Committee on the Unauthorized Practice of Law of the Supreme Court of New Jersey issued an opinion holding, among other things, that it would be unethical for New Jersey lawyers to participate in Avvo Legal Services.

In response, Consumers for a Responsive Legal System, an organization that represents Avvo and other online companies providing lawyer referrals, petitioned the NJ Supreme Court to review the order.  But earlier this month, the court denied the petition.

Responsive Law executive director Tom Gordon said in a statement that, “by summarily declining to review the decision … [the court] has abrogated its responsibility to engage in active supervision of the bar’s anti-competitive conduct.”

This statement is, of course, a reference to the holding of the U.S. Supreme Court's decision in North Carolina State Board of Dental Examiners v. Federal Trade Commision, in which the Court found regulation of a profession is subject to antitrust regulation if it is exercised by market participants unless there is active supervision by a government agency.  In other words, the organization (and Avvo) are gearing up to argue that the system of self regulation used by the legal profession violates antitrust principles.

On the other hand, the NJ State Bar Association issued a statement stating, in part, that “The court’s decision to let stand the joint opinion is an important . . . provides clarity for New Jersey lawyers and protects consumers" and that “[t]he association has increasingly grown concerned about the number of organizations that have sought to open the door to fee sharing, which could interfere with a lawyer’s independent professional judgement, and with the concept of organizations providing legal services when they are not bound by the same ethics rules that guide attorneys.”

I am not sure that both statements are entirely accurate.  The fact that the court denied the petition does not mean it did not exercise supervision.  If it reviewed the petition, it exercised supervision.  Avvo just doesn't like the result.  That does not make the review insufficient; it just makes it unfavorable to its position.

On the other hand, the statement by the Bar Association, is not entirely convincing either.  It suggests that Avvo is "providing legal services," which it does not do.

For more on the court's denial of the petition, go here.

UPDATE 7/6/18:  Lawyer Ethics Alert Blogs has an update here.

ABA Formal Opinion 481: When does a lawyer have a duty to inform a client that the lawyer has made a mistake in the representation? -- UPDATED

The Standing Committee on Ethics and Professional Responsibility of the American Bar Association recently issued Formal Opinion 481, called “A Lawyer’s Duty to Inform a Current or Former Client of the Lawyer’s Material Error” in which it concludes that attorneys have a duty to disclose material errors in representation to their clients. You can read the opinion here.

Evidently, the duty is limited by "materiality," but what is it that makes an error "material." According to the opinion, a material error is defined as one that a “disinterested lawyer” would conclude is either “(a) reasonably likely to harm or prejudice a client, or (b) of such a nature that it would reasonably cause a client to consider terminating the representation even in the absence of harm or prejudice.”

Interestingly, however, the opinion finds that there is no duty to inform a former client if the lawyer discovers after the attorney-client relationship has ended that the lawyer made a material error in the former client’s representation.

You can find short comments on the opinion over at The Law for Lawyers Today and Professional Liability Matters.

UPDATE (1/17/19):  Legal Ethics in Motion has a short comment here.

Maine is considering revising Rule 1.10 to allow for screening as a solution to imputed conflicts of interest

The Maine Supreme Court is seeking comments on a proposal to revise Rule 1.10 to allow for screening as a solution to imputed conflicts of interest.  The Legal Profession blog has more information here.

Should legal technicians be allowed to represent clients in courtrooms

A few years ago, Washington state made news by approving a program to recognize licensed limited legal technicians (LLLTs) who would be allowed to provide limited legal services to clients.  Since then, other jurisdictions have been working on approving similar programs.

The program has not generated the results many expected.  There were problems with the direction of the program itself, and so far only 30 people have become LLLTs.

In addition, the original program, however, did not allow the LLLTs to represent clients in courts.  This decision limited one of the goals of the program which is to provide access to legal representation to those who don't have access to it.

Thus, it can be argued that there is an inherent contradiction in a system that seeks to increase access to legal services but that also limits the participation of LLLTs in that representation. 

Here is a recent article addressing this issue, which argues that LLLTs should be allowed to represent clients in the courtroom.

Indiana Supreme Court Disciplinary Commission announces it will begin to publish advisory opinions; and uses first opinion to find that participating in Avvo creates the risk of violating the rules

The Indiana Supreme Court announced today that it will begin offering ethical guidance to Indiana lawyers and judges via the Supreme Court’s Disciplinary Commission.  The opinions, which will be available online at the Indiana Courts Portal (here), will be non-binding and will be issued in response to prospective or hypothetical questions regarding the application of the ethics rules applicable to Indiana judges and lawyers. (By saying "prospective" there, the court means that it will not offer advice on past conduct.)

The commission made the announcement at the same time it release its first opinion which is on a topic I have written about extensively: whether participating in Avvo Legal Services (and other similar services) would constitute a violation of the rules of professional conduct. 

In the opinion, which is only three pages long, the Commission does not answer the question definitively, but concludes that participating in such programs raises the risk of violation of certain rules, including Rules 1.2(c), 5.4(a), 5.4(c), 7.2(b), 7.3(d) and 7.3(e).

The opinion essentially expresses the conclusions of the Commission rather than explain the analysis it used to reach those conclusions.  However, the conclusions are in accord with opinions published so far in other jurisdictions, all of which so far have reached essentially the same conclusions.  North Carolina is considering a proposed opinion that would conclude the opposite but it has not been adopted yet.  If adopted, it would be the first one to find that participating in Avvo Legal Services would not violate the rules, although it has been reported that North Carolina is also considering amending the rules, which suggests that it would violate the current rules. 

For all my posts on Avvo, go here, scroll down and then read up in chronological order... (ie, the most recent posts will appear at the top of the page.)

Alaska warns about using "cc" an "bcc" when using e-mail.

A recent ethics opinion issued in Alaska concludes that it is not necessarily unethical for attorneys to carbon-copy or blind-copy clients in e-mails exchanged with opposing counsel.  However, the ethics opinion warns that the practice of using “cc” or “bcc” could cause lawyers to face disciplinary action—as well as be adverse to their clients’ interests—if the client inadvertently clicks “reply all” and responds with a message that reveals case strategy, negotiation tactics, or other confidential information that should not be disclosed.

It is interesting that the attorney would face disciplinary action for the conduct of the client, but I guess it is the conduct of the lawyer which put the client in the position to make the mistake.  There are opinions in other two states that have held the same thing.

For more details on this story, go here.  You can read the opinion here.

Illinois State Bar Association issues opinion holding it is unethical to use email tracking software.

A recent Professional Conduct Advisory Opinion from the Illinois State Bar Association (Opinion No. 18-01, January 2018) joined at least three other jurisdictions in concluding that the practice of using hidden email tracking software would be unethical for a variety of reasons. (See Alaska Bar Association Ethics Opinion No. 2016-01; New York State Bar Association Ethics Opinion 749; and Pennsylvania Bar Association Formal Opinion 2017-300.)

For more on this story go here, and here. Michael Kennedy, of Ethical Grounds, offers good analysis here.

Prosecutors investigate firms that offer to pay cash to plaintiffs

According to a story in the New York Times, published March 19, federal prosecutors are investigating finance companies that provide cash advances to plaintiffs in personal injury and other lawsuits. 

Because lawyers are banned from providing financial assistance to clients involved in litigation, it is not uncommon for plaintiffs who need money quickly to either settle their claims for less than their value or to seek help from these companies which offer cash in exchange for repayment out of a future judgment plus interest.  And it is that interest that raises concerns because it is often extremely high. 

Again, due to the fact that lawyers can't help clients financially, it is also not uncommon for lawyers to suggest to their clients to go to the financing companies for help.  In fact, many of the cash-advance firms rely on lawyers to send them financially unsophisticated clients who are waiting to collect on legal settlements. And this is also under investigation. 

According to the story, federal prosecutors in Manhattan are seeking information about the business relationships between the cash-advance firms and the trial lawyers who sometimes refer their clients to the firms, apparently looking into whether there were formal financial arrangements between the parties, which could be construed as illegal kickbacks.

Those who defend the financing industry argue that it provides a crucial service, allowing customers to afford basic expenses and to hold out for potentially more attractive settlements instead of automatically accepting defendants’ initial offers. 

This is true but it does not necessarily justify the high interests which appear to be abusive.  But the industry responds to this argument by saying that the high interests charged are justified because the recovery of the financial advances are not guaranteed.  If the plaintiff does not recover a judgment in their favor, or if it is too low, the company does not recover its investment.

In response, a few states have imposed ceilings on the interest rates on settlement advances, which might be a good way to achieve an acceptable compromise.  State legislators in New York have introduced similar legislation.

Florida amends rules regarding lawyer referrals to include online for-profit services

Earlier this month the Florida Supreme Court amended the state’s lawyer referral rules to include for-profit “matching” sites and lawyer directories,, such as Avvo Legal Services, Rocket Lawyer and LegalZoom.  You can find the amendments here.

According to the court the amendments create a single regulatory scheme that includes for-profit lawyer referral services, pooled advertising programs, lawyer directories, internet “matching” sites and lead generation services.

However, the rule did not change some of the current requirements to which some of the online services object.  For example, the rule still bans fee-sharing with non-lawyers which is the main reason ethics opinions in other jurisdictions have held that participating in services like Avvo Legal Services would be unethical.

Read more about the new rules here.

Podcast: Ethically problematic marketing

Lawyerist and The Legal Talk Network has posted a podcast on ethically problematic marketing strategies. You can listen to it by clicking on the play button below or by going here.

 

Five questions on technology competence

As you probably know, more than half the states have adopted the ABA Model Rules' suggestion that lawyers must be knowledgeable about "technology" as part of the duty of competence.  Go here and scroll down for multiple stories on the subject.

To help educate lawyers about technology, here is a short article called "Five Questions to Test Your Understanding of the Ethics of Technology."

Article on using digital assistants in the practice of law

Here is an interesting article on the use of digital assistants like Amazon's Alexa, Microsoft's Cortana and Google Voice in the practice of law, including a discussion of issues related to confidentiality.

3M settles case filed by state of Minnesota

3M has agreed to pay $850 million to settle a long-standing lawsuit filed by Minnesota, over the company’s disposal of perfluorochemicals used in Scotchgard and other products, which the state says polluted drinking water sources.  Go here for more details.

Why is this relevant?  Because this was the case in which the law firm Covington & Burling was disqualified for allegedly violating the "hot potato doctrine."  Go here, here, here and here for my original posts on the case.  The disqualification order was later remanded for further proceedings.

Legal Talk Network: Podcast on Limited License Legal Technicians

Long time readers of this blog will remember the debate on whether non lawyers should be licensed to provide limited legal services and how Washington state became the first jurisdiction to recognize Limited License Legal Technicians (LLLTs).  See here, here, here and here, for some of my posts on this starting back in 2015.  Go here for a 2017 podcast on the subject.

Last week, the Legal Talk Network published a new podcast on the subject.  You can access it here.

Comments on proposed changes to the ABA rules on advertising

As you know, the ABA is considering a series of changes to some of its rules related to advertising.  As I have commented before, the changes are somewhat controversial, but mostly because many think they are not bold enough.  Go here for a summary of the issues.

2Civility, a website of The Illinois Supreme Court Commission on Professionalism, has published a short comment on the proposed changes that includes interesting comments from readers.

Also, Avvo's Lawyernomics has published (here) a comment called "Why the ABA’s Proposed Attorney Advertising Rule Changes Don’t Go Nearly Far Enough."

Avvo's comment is interesting but not quite well reasoned.  One of its main points is that states should eliminate rule 7.2 (and some others) entirely because the only rule needed is 7.1 which bans the publication of false or misleading advertising.

First of all, if we are going to eliminate something entirely, I'd say let's get rid of the notion of "misleading."  But that aside, the problem with arguing that everything can be "dealt with" by looking at the principle in rule 7.1 is that that principle is different than the one expressed in rule 7.2.

The principle in 7.1 is that the state has the authority to regulate speech that is not protected by the First Amendment.  Evidently, if the speech is not protected, the state can regulate it.  The principle in rule 7.2 is that, in addition to that, under certain circumstances the state can also regulate speech that is protected.

Opponents of the regulation of advertising can argue that the state should not engage in the regulation  of protected speech or that the regulation should be more limited than it is now.  That is a valid argument over which reasonable people can disagree.  But the basis of the argument is a debate on whether regulation is a good idea as a policy matter; not that rule 7.1 already covers it.

Short summary of the ABA proposed changes to advertising rules (and some questions left unanswered)

Over at The Law for Lawyers Today, Karen Rubin has posted a short but informative comment on the ABA proposed changes to the Model Rules on advertising and solicitation.  You should go take a look at it here.

As she explains, the proposed changes are not that bold and do leave some of the most controversial issues untouched.  However, I do like the proposal that eases the approach to the ban on advertising as "specializing in" a particular area of law which I have criticized many times in the past.  (See here, and here for example.)

Reminder: You can comment on the ABA's proposed amendments to rules regarding advertising

The Standing Committee on Ethics and Professional Responsibility has released a Working Draft of proposed amendments to the ABA Model Rules of Professional Conduct on lawyer advertising. More information about the Working Draft is available here. The Ethics Committee wants to hear your opinion on its draft and your ideas for making it better.  You have two ways to communicate your thoughts and suggestions: (1) attend the February 2, 2018, public forum in Vancouver, Canada held in conjunction with the ABA MidYear Meeting and (2) provide written comment to the Committee through its email address modelruleamend@americanbar.org.  The Center’s Ethics Department has compiled a summary of the proposed amendments. It is available here.

UPDATE (1/20/18):  Legal Ethics in Motion has an update a lots of links to more information here.