Abbie F. Willard Re: Multidisciplinary Practice - Center for Professional Responsibility

August 2, 1999

 

Sherwin P. Simmons
Chair
American Bar Association Commission on Multidisciplinary Practice
541 North Fairbanks Court
Chicago, Illinois 60611

Dear Mr. Simmons:

When I spoke before your Commission this past February, I offered my perspective on the option of multidisciplinary practice, as seen through the lens of an Assistant Dean at a large law school and board member and past chair of the National Association for Law Placement, Foundation on Research and Education. I outlined a number of benefits that would likely obtain from partnerships between lawyers and non-lawyers, and suggested to you that multidisciplinary partnerships could offer integrated client solutions to complicated problems, and could provide new choices for lawyers in practice structures.

I am deeply troubled that these benefits cannot be achieved if the current proposal is adopted. I read the Commission's proposal to regulate lawyers, wherever they provide any services that are provided by lawyers in law firms (Rec. ¶ 11; Rep. at 5; App. A at A1), to mean that virtually every individual with a law license who offered some sort of law-related client services would be subject to bar regulation, whether or not their clients thought they were receiving legal services. 1 This expansion of the so-called "regulatory tent" (see App. C at C18) will have potentially dramatic and far-reaching consequences.

The fastest growing source of jobs for new graduates is in business and industry, not private law firm practice. According to the most recent employment analysis of the National Association for Law Placement, 14.2% of 1996 law school graduates and 14% of 1997 graduates took jobs in the business sector, the highest level in the 24 years NALP has collected employment data. National Association for Law Placement, Class of 1997, Employment Report & Salary Survey 28 (1998). This sector is the "only consistently growing source of jobs for new law graduates." Id. Let me be clear about these positions: a majority of them (61% according to the NALP statistics) are jobs in "management, consulting, policy analysis, real estate, retail, and publishing which are not specifically law-related, and 'alternative' careers in which the J.D. degree is desirable or preferred but not required." Id. At the same time, experienced lawyers are increasingly moving into the business and industry sector to offer law-related client services. A great majority of these lawyers report strong dissatisfaction with law firm practice, and are seeking an alternative.

But the Commission's proposal threatens to change this calculus. Many of the law-related client services offered by lawyers and non-lawyers at investment banks, real estate firms, management consulting firms, banking and financial institutions, public relations firms, tax preparation firms, insurance companies, and accounting firms are also offered by lawyers in law firms. The Commission recommends that the lawyers offering such law-related services be regulated as lawyers. The Commission proposal treats their employers as multidisciplinary practices because they "include[] lawyers and nonlawyers and [have] as one, but not all, of [their] purposes the delivery of legal services to a client(s) other than the MDP itself." (Rec. ¶ 3.) And these businesses would be subject to bar regulation, including the proposed certification and audit requirement for non-lawyer controlled MDPs, the attorney conflict of interest rules, and the attorney rules on advertising and solicitation. (See Rec. ¶¶ 7, 14.)

Many businesses today hire newly-minted law school graduates and experienced lawyers to provide law-related services to clients. These businesses do not advertise that they are practicing law, nor do they create any client expectation that legal services are being provided.

I do not expect that most of these businesses will have any interest in subjecting themselves to the extensive regulatory scheme of every state bar in which they "deliver" legal services. I anticipate that these business will insist that their lawyer-employees turn in their law licenses, and will terminate those lawyers who refuse to surrender their law license. Further, I envision that these businesses will immediately stop hiring individuals trained as lawyers to avoid the regulatory structure imposed by the Commission.

Organizations that are publicly owned or have equity shareholders face an even greater burden. The Commission observes that its proposed changes to the ethics rules are not intended to alter "current provisions limiting the holding of equity investments in any entity or organization providing legal services." (Rec. ¶ 13.) Put simply, publicly owned organizations like investment banks and public relations firms do not have the option of deciding whether or not to become an MDP: they cannot offer legal services. If such businesses seek to continue their practice of hiring lawyers to offer client services, they will only be able to hire lawyers who surrender their law licenses. Likewise, existing employees with law licenses will have to give up their licenses or look for other jobs.

Law school and legal practice have long been viewed as valuable training for all manner of careers beyond the law. A lawyer's analytical approach to problem-solving and her skills at advocacy and writing are highly valued and easily lend themselves to many other occupations. This is evident both in the growing diversity of work handled by law firms and in the growing number of lawyers who have taken jobs with firms offering law-related services that do not require a J.D. degree. In many areas, there is considerable overlap in the services provided by law firms and by non-lawyer service providers B consider, for example, lobbyists, sports and talent agents, public relations firms, environmental consultants, and, of course, tax advisors. Graduating from law school and passing a bar exam is not a necessary prerequisite to providing these services. This is good for the public, which does not hold the legal profession in high esteem and seeks choice among service providers. And it is also good for lawyers, who seek career options outside of traditional law firm practice.

Let me be clear. I wholeheartedly support bar regulation of lawyers when they create a client expectation that they are offering legal services. If lawyers are permitted to share fees with non-lawyers, I believe that these lawyers should be regulated by the bar when they market legal services to clients. But that is very different from the regulatory structure proposed by the Commission, which threatens to destroy all private employment options for licensed lawyers outside traditional law firms. The net result of regulating lawyers, wherever they offer law-related services, and their employers, is that the fastest growing source of jobs for new law school graduates -- business and industry -- will quickly be diminished if not eliminated. That, in turn, will substantially limit all lawyers' career options and reduce the value of a legal education. The future of the profession and the public at large will not be well served by this over-regulation of multiservice providers and the law-trained professionals who choose to serve clients outside of the traditional law firm domain.

I urge the Commission to revise its proposal to prevent this from happening.

 

Sincerely,

Abbie F. Willard

 


NOTES

1. My understanding is also shared by the Reporter for the Commission, who notes that the Commission’s recommendations would "prevent an individual who satisfies the definition of a ‘lawyer in an MDP’ from arguing that he or she is providing consulting, business, or tax ‘advice’ and consequently not subject to a lawyer code of conduct. . . ." App. C at C34-C35 n.65.

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