Legal Ethics Forum

Maya Steinitz, "How Much is that Lawsuit in the Window? Pricing Legal Claims"

Article. Abstract:

This article poses the question: How should parties to litigation finance agreements - third party funding or contingency fees - deal with the inherent difficulty in pricing legal claims? It answers that a practical solution would be to use staged funding. Staged funding side-step the impossibility of accurately pricing litigation ex ante by allowing re-pricing and exit that are pegged to information disclosure. Done right, staging allows all parties to minimize the effects of uncertainty, better price their bargain, optimize the distribution of the proceeds of litigation between its different investors - far beyond practices common today. Staged funding also facilitates increases in the value of the option to settle - described here as a compound call option - by accounting for real options i.e., lawyers’ and funders’ option of adjusting their investments in response to new information. The article conclude with practical suggestions on how to adept staged funding, common in venture capital, to third party litigation funding.

Barton v. Dep't of Transp. (Wash. Supreme Court; undisclosed covenant not to execute)

Justia: Jared Barton sued Korrine Linvog, her parents Thomas and Madonna Linvog, and the State. Barton reached a settlement with the Linvogs through which the Linvogs agreed to advance Barton money in exchange for his promise not to execute a judgment against them above their insurance policy limits. Neither Barton nor the Linvogs disclosed this settlement to the court or to the State. After a jury trial, Barton was awarded $3.6 million, and the trial court entered judgment against the State and the Linvogs. In the process of paying the judgment, the State discovered the agreement. The State then moved to vacate the judgment on grounds of fraud and misrepresentation. The trial court denied the motion but sanctioned Barton's attorney for failing to disclose the terms of the agreement. Barton's attorney appealed the sanction. Finding no abuse of discretion in its sanction against Barton's attorney, the Supreme Court affirmed.

UPDATE: Please read the insightful comment, below, by a reader who has thought through the impact of the sanctions on the disabled client.

ABA names 2013 "Legal Rebels"

PR profs (including our own Renee Knake and also Michele DeStefano) are well represented on the list of people the ABA has touted for being change leaders in the profession. Story at ABA Journal. Excerpt:

On our list is a law student making law visual. A professor bringing mock competition to transactional practice. Another linking students and mentors from around the world to solve legal problems. A pioneer in law firm incubators now creating an incubator for incubators. A provider of free learning tools for law students teaching students to create computer-based guides for pro se litigants. And two profs whose goal is no less than reinventing the law. Add in an attorney whose trademark search engine bests the U.S. Patent and Trademark Office system while his prices stay low, a general counsel taking outside law firms to school for not knowing their own software, and a lawyer/software engineer invoking the name of Hammurabi as he turns law into computer code. Individually and all together, they are planting their banners on the pinnacle of legal innovation. And they are our Legal Rebels, the class of 2013.

Veronica Root, "Retaining Color"

Article. Abstract:

It is no secret that large law firms are struggling in their efforts to retain attorneys of color. This is despite two decades of aggressive tracking of demographic rates, mandates from clients to improve demographic diversity, and the implementation of a variety of diversity efforts within large law firms. In part, law firm retention efforts are stymied by the reality that elite large law firms require some level of attrition to function properly under the predominant business model. This reality, however, does not explain why firms have more difficulty retaining attorneys of color — in particular black and Hispanic attorneys — than white, male attorneys.

And yet, there may be a relatively simple and low-cost set of incentives that law firm management and the legal profession can put in place to encourage black and Hispanic attorneys to remain at large law firms at higher rates. This Article draws on traditional theories of “the firm” and modern-day understandings of discrimination and applies them to the retention problem in large law firms. It argues that by incentivizing equity partners, overwhelmingly white males, in large firms to instill greater “loyalty” in black and Hispanic attorneys, firms can solve a large portion of their retention problem. As equity partners invest more time mentoring black and Hispanic attorneys, they will develop a sense of loyalty to the firm that will decrease the speed and frequency that attorneys of color “exit” the firm. Firms can then begin Retaining Color.

Is texting a solicitation "in person," or "real-time"?

I posted an inquiry on this on a listserv and the answers have been interesting. Ohio says it may not be. Legal ethicists have intuitions both way on the topic. Some wonder if there isn't a generational divide on the question. Here's an article by Mark DuBois on the topic. Excerpts:

The Ohio Supreme Court just issued an ethics opinion (2013-2) on lawyers' use of texting technology as lawyer advertising. Seems some lawyers buy police reports about accidents and these contain the phone numbers of the parties. Some enterprising lawyer have tried to text the injured victims for business.

If texting to potential clients is something you think you want to do (or are already doing), get a copy of this opinion and study it. The court deserves props for figuring out this technology and how it fits into the traditional framework of lawyer-public communication.

I would have thought that sending a text message to the telephone of a person arrested for a crime or involved in an auto accident was a form of "personal, live telephone, or real-time electronic contact, including telemarketing contact" prohibited by Rule 7.3 of the Rules of Professional Conduct. The Ohio court likens it more to e-mail, which is permitted under Ohio rules, than to a chat room conversation, which is prohibited. However, it also cautions that there are some rules that need to be followed.

The text cannot create "real-time" interaction. I guess that means that the person cannot text you back. (I can imagine what some of those texts would say!) Or if the client texts you back, may be you cannot answer.

From the Ohio opinion:

Lawyers may advertise their services through SMS text messages, which are written and/or electronic communications for purposes of Prof.Cond.R. 7.2(a). All lawyer  advertising, including text message advertising,must comply with Prof.Cond.R. 7.1 and 7.3. Under Prof.Cond.R. 7.1, the text message may not contain a false, misleading, or nonverifiable communication about the lawyer or the lawyer’s services. Prof.Cond.R. 7.3 imposes five additional requirements that apply to text message advertising by lawyer: [no real-time interaction; no coercion; say it's "advertising"; if the recipient is a defendant in a civil case, verify if the person has been served; don't solicit within 30 days of the accident].

Ronit Dinovitzer, Bryant Garth, Joyce Sterling, " Buyers' Remorse? An Empirical Assessment of the Desirability of a Legal Career"

Article. Abstract:

The literature attacking the value of legal education relies as a rule on the idea that individuals attend non-elite law schools because of optimism bias -- thinking they will get the lucrative corporate jobs deemed necessary to pay off educational debt. They presumably would then get buyers' remorse when their optimism proves unjustified. Drawing on the first two waves of the only longitudinal data on lawyer careers, the After the J.D. Study, the authors examine whether those who began their careers in the year 2000 -- with substantial debt even if not as high as today's graduates -- showed evidence of buyers' remorse about their decision to get a law degree. The evidence indicates that law graduates beyond the most elite were able to pay down their debt at the same rate or better than most elite law graduates. In addition, after seven years of practice the great majority of these lawyers were still satisfied with their decision to become lawyers. In fact, there is no statistically significant difference in reported satisfaction with the decision to become a lawyer when we compare graduates from the higher and lower ranked law schools. And while there is some suggestion that lawyers who reported still owing more than $100,000 after seven years of practice were either ambivalent or dissatisfied with their decision to invest in a legal career, multivariate models show that percent of debt remaining seven-eight years into one's career has no significant relationship with career satisfaction. Thus, in contrast to the dominant story, most respondents irrespective of debt are extremely or moderately satisfied with their decision to become a lawyer. There is no indication in our data that these law graduates feel they made a mistake by choosing to go to law school. The data also show that those most likely to favor eliminating the third year of law school were elite law graduates and attorneys in large corporate law firms -- again a contrast to the dominant story.

Justice Ginsburg's NYT interview was "Unnecessary and Inappropriate"

Paul Horwitz at Prawfsblawg offers that view about the New York Times interview of Justice Ginsburg. Excerpt:

The bottom line, for me [Paul Horwitz], is that the interview was unnecessary, and when you combine the fact that it was unnecessary with the political nature of her advocacy in the interview, it was perforce inappropriate. I don't doubt that some will applaud the interview because they like her, or like what she said, or both. Neither those reasons, nor the general goal of pleasing or rallying the base, are sufficient reasons to justify it. Justice Ginsburg insists in the interview that she is still fully capable of making decisions. I have no reason to doubt it. But her decision to do this interview was itself unwise and more than a little self-indulgent.    

Richard Zitrin, "Regulating the Behavior of Lawyers in Mass Individual Representations: A Call for Reform"

Article. Abstract:

Cases in which lawyers represent large numbers of individual plaintiffs are increasingly common. While these cases have some of the indicia of class actions, they are not class actions, usually because there are no common damages, but rather individual representations on a mass scale. Current ethics rules do not provide adequate guidance for even the most ethical lawyers. The absence of sufficiently flexible, practical ethical rules has become an open invitation for less-ethical attorneys to abuse, often severely, the mass-representation framework by abrogating individual clients’ rights. These problems can be abated if the ethics rules offered better practical solutions to the mass-representation problem. It is necessary to reform the current rules, but only with a solution that is both practical and attainable, and with changes that maintain the core ethical and fiduciary duties owed by lawyers to their individual clients, including loyalty, candor, and independent professional advice.

David McQuoid-Mason, "Access to Justice in South Africa: Are There Enough Lawyers?"

Article. Abstract:

This paper addresses head on the contention by a prominent legal practitioner in South Africa that there are too many lawyers in the country. It does not canvass the complex issues involved in determining the meaning of access to justice or the relationship between law and society in the context of legal services, and deals with access to justice in the narrow sense of the delivery of legal services in South Africa. The paper analyses the evidence presented to substantiate the contention that there are too many lawyers against the socio-economic environment in South Africa and the requirements of the Constitution. It recognizes that the country has only a minority of people who can afford lawyers and compares the ratio of lawyers to people in this category with the ratio in other developed countries. It also recognizes that large numbers of people who cannot afford lawyers may need them and that such people will have to rely largely on the state-funded national legal aid body, Legal Aid South Africa and other mechanisms. The paper discusses the different modes of delivery of legal aid services by Legal Aid South Africa, as well as those provided by the legal profession pro bono, public interest law firms and mechanisms that compliment or are alternatives to lawyers, in the light of the number of practicing lawyers in the country. An analysis is made to determine if there are enough lawyers to provide the necessary legal services required by the Constitution in criminal matters, and for civil matters in general for those who can and cannot afford lawyers. The paper concludes that there are not enough lawyers in the country at present to provide access to justice in the narrow sense, and suggests how this shortage can be overcome by using mechanisms that provide alternatives to lawyers.

Kath Hall, "The Expansion of Global Law Firms in Australia and Asia"

Article. Abstract:

Over the last 18 months the legal profession has seen unprecedented growth in the operations of global law firms in Australia. Recent mergers between top-tier and leading Australian law firms demonstrate the importance of Asian markets and the shifts in economic power from the West to the East. For such firms there are clear market and competitive drivers for expansion into Australia including proximity to rapidly developing Asian economies and increased opportunity to expand the firm’s global brand. Yet understanding the role played by Australian law firms in these developments can be tricky. For some newly merged global firms, the Australian operations are central to the firm’s regional and global expansion, allowing the firm to draw upon the strong performance and reputational capital of the Australian offices. For other global firms their alliances with Australia firms provide a strategic foundation for their expansion into Asia. And for third group of firms Australia remains a destination in its own right, sitting within the firm’s overall global network of international offices.