Want to help the economy? Don't cut legal aid

Over at Above the Law, David A. Lash, the Managing Counsel for Pro Bono and Public Interest Services at O’Melveny & Myers LLP, has published a short article on the importance of supporting legal aid.  In it, he argues that "allocation of funding for legal aid is a wise investment. In addition to the lives it saves, investment in lawyers for the poor, on a strictly economic, cost-benefit analysis, is an investment worth making. For every dollar spent in support of legal services, an astonishing rate of return results. By any measure, an investment yield of ten-to-one is an investment worth making."

You should read the article here.

Court of Appeals for the Second Circuit rejects argument that rules that ban lawyers from raising capital from non lawyers are unconstitutional -- UPDATED

In an important and highly anticipated opinion, the Court of Appeals for the Second Circuit has rejected an argument against the rules of professional conduct which ban lawyers from accepting capital investment from non-laywers.  In this particular case, the specific rules challenged were those of the state of New York, but the reasoning of the court is likely to influence courts in other jurisdicitons.

The ruling is a big blow to those who have been proposing adopting different rules, now in use in the UK and Australia, that would allow lawyers to practice law through "alternative business structures."

On the other hand, the ruling should not be unexpected since the American legal profession has proven to be very reluctant to adopt such a view.  There is a lot of literature about this and it was the hot issue in Professional Responsibility circles for the last couple of years. 

Many thought the ABA was ready to point the way toward change when, in 2014, it created the Commission on the Future of Legal Services and charged it with the task of studying how legal services are delivered in other countries and of recommending innovations that would improve the delivery of, and the public’s access to, legal services in the United States.

Yet, when the Commission presented its final report at the 2016 ABA Annual Meeting it essentially merely encouraged states to “explore how legal services are delivered by entities that employ new technologies and internet-based platforms and then assess the benefits and risks to the public.”  As for the notion of alternative business structures, the Commission’s report’s language was even more tentative, merely stating that “[c]ontinued exploration of alternative business structures will be useful.”  For my comment on the Commission's report go here.  I also have a short article on the debate regarding the future of the profession in 41 Journal of the Legal Profession 1 (2016).

Not content on waiting for the ABA to act, the law firm Jacoby & Meyers, challenged the constitutionality of a collection of New York regulations and laws that together prevent for‐profit law firms from accepting capital investment from non‐lawyers.

In its opinion rejecting the argument, the court explained that the law firm alleged that, if they were allowed to accept outside investment, they would be able to—and would—improve their infrastructure and efficiency and as a result reduce their fees and serve more clients, including clients who might otherwise be unable to afford their services, and that the challenged rules unconstitutionally infringe the firm's rights as lawyers to associate with clients and to access the courts—rights that are grounded, they argue, in the First Amendment.

The District Court dismissed the complaint, concluding that the firm failed to state a claim for violation of any constitutional right and that, even if such rights were to be recognized, the challenged regulations withstand scrutiny because they are rationally related to a legitimate state interest.

The Court of Appeals agreed and affirmed.  You can read the full opinion here.

UPDATE (3-28-17):  The ABA Journal has a short post on the story here.  The NY Personal Injury Blog has a comment here.

Yet another case on whether a fee sharing contract that does not follow the rules can be enforced

A few days ago I posted a note about a recent case on the issue of whether a fee sharing contract that does not strictly meet all the requirements of the rules of professional conduct can be enforced.  Since then, I have learned that the issue is currently under review by the Illinois Supreme Court.  You can listen to the oral argument here.

This is an interesting question and there are a few cases out there on the subject.  I will write a longer comment on the case soon.

Is a fee sharing contract that violates the rules of professional conduct enforceable?

A few years ago I reported on an Illinois case that held that a contract that violated the rules of professional conduct could not be enforceable.  I did not like the decision, and my comments on it are here.

I was reminded of this case because just a couple of days I ago I read that a court in Washington DC recently reached a different result.  The Legal Profession blog has a report here.

ABA is seeking comments on proposal to amend advertising and solitication rules -- UPDATED

Feb. 24, 2017 
The ABA Standing Committee on Ethics & Professional Responsibility is currently accepting comments on APRL’s comprehensive proposal which seeks to standardize the rules and focuses regulation on false and misleading communications about legal services. It includes amendments to Model Rules 7.1, Communications Concerning a Lawyer’s Services; 7.2, Advertising; 7.3, Solicitation of Clients; 7.4, Communications of Fields of Practice and Specialization; and 7.5, Firm Names and Letterheads. The APRL proposal can be found here.  For more information, go to the ABA website here.

UPDATE (3-11-17):  The Illinois Supreme Court Commission on Professionalism has published an article summarizing the debate on this issue here.

Tennessee adopts duty of competence regarding "technology"; Two recent articles explore the meaning of such a duty

Last week, the Supreme Court of Tennessee issued an order adopting a number of amendments to the state's rules of professional conduct, including adopting a duty of technology competence.  Twenty seven states have now adopted such a duty.  Law Sites has more details here.

Meanwhile, Law Technology Today has published a two part article on the ethical duty of technology competence.  Part I is here; Part II is here.

New Ohio opinion reminds us of the difference between fees and expenses

The Ohio Board of Professional Conduct recently issued an advisory opinion on lawyer advertising that emphasizes the need to be clear about the difference between fees and expenses.  The opinion, Advisory Opinion 2017-01, states that lawyers who provide services on a contingent fee basis may not use statements such as “There’s no charge unless we win your case,” or “No fee without recovery,” if the lawyer intends to recover the value of litigation costs and expenses from the client. If a lawyer intends to recover advanced costs and expenses of litigation from the client, a disclaimer is required in the advertisement that explains the client’s obligations for repayment.

California Committee issues final draft of opinion on whether blogs are subject to advertising rules

Legal Ethics in Motion is reporting that the California Standing Committee on Professional Responsibility and Conduct has finalized an opinion on whether attorney-authored blogs should be governed by the advertising regulations. The Committee concluded that blogs should be governed as attorney advertising if the blog directly or indirectly expresses the attorney’s availability for professional employment. Thus, a blog that is a part of a firm’s professional website is governed by the advertising guidelines.  “Stand-alone” blogs, or blogs that exists independently of any website an attorney maintains or uses for professional marketing purposes, are also subject to the rules if its content has the same effect as professional blogs.  For more information go here.

New York State Bar Association launches new platform to provide better access to legal representation

The New York State Bar Association, and Legal.io, a developer of referral-network and marketplace platforms for the legal industry, have teamed up to launch a state-of-the-art lawyer referral platform that they say will significantly expand access to legal services in that state.  Interestingly, the developers of this new platform have been reported to describe it "as a more ethical alternative to privately run referral sites such as Avvo..." It will serve New York residents seeking legal help as well as businesses anywhere seeking advice on New York law.  Law Sites has more information here.