Monday, April 12, 2021

Article on regulatory changes in Utah and Arizona

 As you probably know, last year Utah and Arizona adopted new rules to fundamentally change the way the practice of law is regulated, including allowing lawyers to partner with non lawyers to practice law and allowing certain non lawyer owned entities to provide legal services.  For more on this go here, and here.

I am writing about this again today because Law360 just published a short comment on the situation in Utah, where . . . "the group of approved participants includes LawPal, an entity planning to offer a "TurboTax-like" platform for divorce and eviction disputes, and 1LAW, which helps clients complete court documents and offers related legal advice through tech including chatbots. A pro bono service provider in Utah is also seeking approval to permit domestic abuse victim advocates to give legal advice while filling out protective order requests. . ."

Sunday, April 11, 2021

Michigan AG files supplemental brief arguing Sidney Powell’s defense in defamation case supports argument for sanctions in election case

In case you don't remember, Sidney Powell is the former lawyer for the Trump campaign who at one time promised to "release the Kraken," argued that the Dominion vote counting machines had somehow been rigged to favor Venezuela's Hugo Chavez and that Dominion had bribed public officials in Georgia, among many other things. 

Some time later, Dominion sued her for defamation and in reply Powell argued that her statements could not constitute defamation because they were so crazy that no one would believe them to be true.  

This defense is somewhat problematic for her because if the statements were so unbelievable, then she herself must have known they were not true when she affirmed them.  And, since she affirmed them in support of litigation, by making the defense in the defamation case she is admitting to either being incompetent or to having instituted litigation improperly, both of which can subject her to professional discipline.

For this reason, it is not surprising to learn that the Michigan attorney general has filed a supplemental brief in the case in which the judge is considering imposing sanctions to draw the judge’s attention to Powell’s latest defense against the defamation lawsuit.  Law & Crime has more on the story.

Over at Verdict, Michael Dorf (Cornell Law) has published a good comment on the defamation case.

UPDATE:  TechDirt picked up the story here.

Monday, April 5, 2021

Wisconsin is seeking attorneys' fees from Trump and Sidney Powell for frivolous litigation attempting to overturn the results of the presidential election

Wisconsin is seeking hundreds of thousands of dollars in attorneys’ fees from Donald Trump and Sidney Powell for their attempts to overturn the state’s election results via lawsuits that were “frivolous, dilatory, and without merit.”  Above the Law has the details here.

Sunday, April 4, 2021

NPR: When It Comes To Email, Some Prisoners Say Attorney-Client Privilege Has Been Erased

 NPR has published a short article on threats to the attorney-client privilege by surveillance of by prison authorities.  The article is available here.  Below you can listen to a short summary by clicking on the play button.

Friday, March 26, 2021

California Becomes 39th State To Adopt Duty Of Technology Competence

 Back in November of 2019 I reported that Georgia became the 38th state to adopt the Model Rules proposition that the duty of competence must include a duty to be knowledgeable about technology.  See here.  And for all other posts on "technology" generally go here and scroll down.

Today I am writing to report that California is the next state to adopt the notion of technology competence.  For details go here.

Sunday, March 21, 2021

On the new business structures in the market of legal services

 A few days ago I reported that the era of non-lawyer owned firms is here, now that Arizona and Utah have approved some version of such an alternative business structure.  

As I have written elsewhere, the debate on whether this is a good idea is not new. (See here, for example).  What is new is that these two states have decided to give it a try.  And, not surprisingly, this has reinvigorated the debate again.

One of the main arguments used to justify opening up the practice of law to non-lawyers (whether by allowing non-lawyers to provide some types of legal services or by allowing lawyers to get capital from and to partner with non-lawyers, or by allowing non-lawyers to “own” law firms) is that it will provide more “access to justice.”

This notion of “access to justice” is, of course, a misnomer, since there is no guarantee of that.  What we should be asking is whether the new regulatory system will provide more access to legal services, or, better yet, to affordable legal services.

Unfortunately, there is no evidence that it will, and if we go by the experiment with Legal Technicians in Washington state, there is evidence that it won’t work. 

Although the new business models may provide more access to consumers, they won’t necessarily reduce the cost of legal services, prevent conflicts of interest or guarantee competent representation.  That is so because the new non-lawyer owners of the law firms are in the business to make a profit.  They need a good return for their investment and that margin is likely to come out of the difference between costs to provide the services and the fees that can be generated.  

Unfortunately, maybe this means that companies more interested in making a profit than in providing wide ranging legal services will devote their attention to reviewing would be clients’ claims in order to find only high value cases, while the others will be swept aside or will not be given the attention they deserve.  Thus, depending on how the new model is structured, it may result in clients with smaller cases actually getting less access to legal services.

But, let’s not rain on the parade.  We won’t know how it will work until we try it so let’s see what happens in Utah and Arizona.  Maybe they can make it work better than Washington could. I am sure we will be talking about this for a long time.  And, as some have said, maybe this is an inevitable shift in the legal services market, in which case, just wait, it will soon be coming to a jurisdiction near you.

ABA issues new formal opinion defining "materially adverse interests" for purposes of conflicts of interest analysis -- UPDATED x2

February 14, 2021  (updates at the end)

Last week, the ABA’s Standing Committee on Ethics and Professional Responsibility issued a new Formal Opinion (number 497) on conflicts involving materially adverse interests.  Its summary states as follows:

Rules 1.9(a) and 1.18(c) address conflicts involving representing a current client with interests that are “materially adverse” to the interests of a former client or prospective client on the same or a substantially related matter. But neither Rule specifies when the interests of a current client are “materially adverse” to those of a former client or prospective client. Some materially adverse situations are typically clear, such as, negotiating or litigating against a former or prospective client on the same or a substantially related matter, attacking the work done for a former client on behalf of a current client, or, in many but not all instances, cross-examining a former or prospective client. Where a former client is not a party to a current matter, such as proceedings where the lawyer is attacking her prior work for the former client, the adverseness must be assessed to determine if it is material. General economic or financial adverseness alone does not constitute material adverseness.

You can read the opinion here

UPDATE 3/4/21:  Faughnan on Ethics has a short comment here.  I agree with his conclusion that the terminology in the rule is a mistake and that the opinion does not really say anything particularly new or interesting.  The terminology is a mistake because it is inconsistent with the terminology used in other rules related conflicts of interest.  Rule 1.7 defines conflicts as involving either direct adversity or material limitation.  Rule 1.9 merged those two terms into "material adversity"  and I honestly believe that was by mistake.  But it has never been corrected and here we are...

UPDATE 3/21/21:   The Louisiana Legal Ethics blog has a comment here.

Florida lawyer facing discipline for calling himself a pitbull lawyer and using image of a dog on his website -- UPDATED

March 13, 2021

The ABA Journal is reporting that a Florida lawyer is facing an ethics complaint for describing himself as a pit bull lawyer and using an image of a pit bull on a blog and a Facebook page. The lawyer also used the name “Pitbull” on business cards and on the door to his office.

The complaint apparently argues that using the pitbull image and nickname harms the legal profession and the public’s trust and confidence in our system of justice.

I don't like pitbulls and I think that calling yourself a pitbull lawyer in advertising is tacky, but trying to impose sanctions for it is nonsense.  I don't know what the specific Florida rules say, but the notion that the state can impose sanctions for protected speech merely because it harms "the image of the profession" and the "trust in the system" is a very weak argument.  

The standard by which commercial speech is evaluated has been established for ages.  As the US Supreme Court has explained: 

Our general approach to restrictions on commercial speech is . . . by now well settled. . . .  Commercial speech that is not false or deceptive and does not concern unlawful activities, . . .  may be restricted only in the service of a substantial governmental interest, and only through means that directly advance that interest. . . . Our application of these principles to the commercial speech of attorneys has led us to conclude that blanket bans on . . . advertising by attorneys and rules preventing attorneys from using nondeceptive terminology to describe their fields of practice are impermissible . . . but that rules prohibiting in-person solicitation of clients by attorneys are, at least under some circumstances, permissible.

Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 638 (1985).  Arguing that protecting the image of the profession is a substantial governmental interest is akin to saying that the speech can be banned because someone may find it offensive, and if we know one thing about the First Amendment, it is that it is there precisely to prevent from punishing speech because someone finds it offensive.  


UPDATE (3/21/21):  The Louisiana Legal Ethics Blog has a comment here suggesting that the same conduct would probably not be subject to discipline in Louisiana because the rules in Florida are stricter.  I suspect this is the case pretty much everywhere else.

Breaking news: Pennsylvania Bar abandons fight over constitutionality of anti-discrimination Rule 8.4(g) -- UPDATED


 March 16, 2021  (update, below)


Back in December, a federal district court declared unconstitutional Pennsylvania's version of ABA Model Rule 8.4(g) holding that it violated the First Amendment.  I wrote about the decision here and here.  

At the time, I said I was hoping the Pennsylvania Bar would appeal so we could get a decision from a Court of Appeals on the subject.  Then, as expected, in January, the Pennsylvania Bar field a notice of appeal to the Third Circuit. 

However, I just heard that yesterday, the Bar voluntarily dismissed the appeal.  I hope there will be more coverage about why in the next few days and I will surely report it when I see it.  

Now, presumably the Pennsylvania Bar will go back to try to draft a new version of the rule.  

I am sure the debate is not over.  Stay tuned.


UPDATE (3/21/21):   The ABA Journal has a short comment here.  In it, I noticed a common mistake regarding the debate on this topic.  Citing another source, the story attempts to distinguish the Pennsylvania rule from the Model Rule by suggesting that the model rule does not attempt to regulate speech.  This is nonsense.  The Comment to the Model Rule explicitly states that the rule applies to "verbal conduct" as well as "physical conduct."  And, if nothing else, let's be realistic.  Part of the motivation for the rule was clearly to get lawyers to stop saying bad things.   

Thursday, March 18, 2021

The era of alternative business structures and law firms owned by non-lawyers is officially here

 As I am sure you know by now, Utah and Arizona recently became the first two states to make changes to their regulatory structure of the practice of the profession to allow, among other things, lawyers to partner with non-lawyers, non-lawyer ownership of law firms and alternative business structures.  I reported on those developments here and here (regarding Arizona) and here, here, here and here (regarding Utah).

And, here is the latest:  Yesterday, the first entirely nonlawyer owned law firm in the United States opened for business in Utah while the Arizona Supreme Court announced (news release) that it has approved the first two alternative-business structure entities to operate in the state.  The ABA Journal has a story from Utah.