Granted, I’m not a legal ethics professor or scholar, a marketing guru or an affiliate of a vendor or insurance company that sponsors the ABA. Still, I expected that because I am practicing lawyer (albeit not a virtual one) who takes ethics seriously and bears the brunt of any newfangled initiatives, that the ABA Ethics 2020 Commission would actually take the time to read my extensive comments (you can view them here (search Elefant) or here.)
So imagine my dismay when I saw that the Committee’s most recent release entitled Issues Paper Concerning Model Rule of Professional Conduct 5.5 and the Limits on Virtual Presence in a Jurisdiction seeking comment on an appropriate standard for determining whether a lawyer’s out of state presence in another jurisdiction is so “systematic and continuous” as to justify licensing. As I’ll discuss, the Committee completely disregarded the very reasonable approach that I proposed here which (1) would have ensured that lawyers with a physical presence and virtual presence are treated on equal footing for purposes of UPL and (2) reflects a bright-line, easy test rather than another loosey-goosey, ambiguous balancing test.
But before I get to my proposal, let’s back up and understand the precise problem that Model Rule 5.5 tries to address. The best explanation comes from Committee Reporter Andrew Perlman at Legal Ethics Forum in the form of this hypothetical:
Imagine that Laura Lawyer is licensed only in Massachusetts and operates a virtual law office from there. She writes wills for clients in Massachusetts and, occasionally, New Hampshire. Lately, the flow of clients from New Hampshire has increased, and Laura is writing an increasing number of wills for New Hampshire citizens. Assume that Laura never visits New Hampshire and performs all of her work in Massachusetts over the Internet.
[...]assuming that the wills are governed by New Hampshire law, does Laura violate Rule 5.5 by writing any wills at all for these New Hampshire citizens? In other words, are these occasional representations permitted by Rule 5.5(c)(4)? (See Comments  and .)
[Second, assuming that] Laura is drafting documents that are intended to have their effect in Massachusetts and will be governed by Massachusetts law, at what point does the flow of clients become so significant that Laura needs to become licensed to practice law in New Hampshire? Put another way, at what point does her practice in New Hampshire become sufficiently “systematic and continuous” to trigger Rule 5.5(b)(1)?
When the original ethics paper was presented, the question of “systematic and continuous presence” was viewed as an issue unique to virtual law firms. Concerns arose that lawyers barred in one state but practicing virtually in another could either unfairly pick off clients from in-state lawyers, or evade service of process or the disciplinary rules of the other jurisdiction. So Model Rule 5.5 does what lawyers do – proposes a multi-part test to determine whether a lawyer is systematically and continuously practicing, examining criteria such as extent of marketing in the other jurisdiction, number of clients represented and extent to which services have their predominant effect in the other jurisdiction.
Sounds fancy, but let’s face it — a rule like this is almost impossible to implement or enforce. When lawyers advertise online, who can say whether ads are targeted in the other jurisdiction? And are lawyers going to be required to produce a log of clients represented and where they live for the bar to review and enforce the proposed rule.
But what bugged me when I filed my original comments on Model Rule 5.5 was the proposal to make exceptions to the systematic and continuous rule for virtual practice but not for brick-and-mortar practitioners. Under both the current and proposed Model Rule 5.5., Annie Attorney, also a Massachusetts-only lawyer, is barred from opening a branch office in Concord, NH and meeting with clients three days a week even if she limits her practice to Massachusetts-only matters (that’s because an office is presumptively considered a “systematic and continuous presence.” So why should Laura Lawyer be given a pass and allowed to represent New Hampshire clients on Massachusetts issues if she serves clients online from her basement in her Boston apartment? The answer: she shouldn’t.
Rather than give virtual lawyers preferential treatment under Model Rule 5.5, I proposed that the rule abolish the “systematic and continuous” test entirely. Instead, any lawyer barred in State A should be permitted to represent clients in matters arising under the laws of State A, whether they work virtually from an office in state B or set up a physical shop in State B limited to State A matters.
Although the Committee completely ignored my proposal (didn’t even bother to mention it in a footnote), it is preferable for several reasons. First, my proposal would encourage mobility — lawyers barred in one jurisdiction who must move to accomodate a spouse’s job or who have retired and spend part of their time out of state could continue to practice in the new location without the expense of another bar admission so long as they limit their practice – either online or in a physical office – to matters in the jurisdiction where they practice. Second, my proposal puts virtual and traditional “brick and mortar” lawyers on equal footing, subjecting them to the same regulations irrespective of the means of delivering service. Isn’t that what virtual lawyers want – parity and location independence?
Recognizing that enforcement can be tricky, I recommended that all lawyers – whether virtual or physical – actively marketing to and representing clients in a state where they are are not barred be required to register to do business in that state, just as a foreign corporation would. The business registration is far less expensive and onerous than new bar admission. Further, business registration would allow regulators to keep an eye on out of state law firms and most importantly, let disgruntled clients effect service of process. Moreover, the business registration would contain the firm’s actual address, and therefore, a client who wants a Massachusetts lawyer located in close proximity rather than in California or India would have the option of identifying the lawyer’s actual physical location and taking it into account (for many clients, physical location won’t even matter)
My proposed solution is clean, clear and most of all principled in that it treats virtual law practices and brick-and-mortar practices equally. Still, it won’t be considered because I’m just a practicing lawyer. What could we possibly know, and why would we matter anyway?