Ethics

I guess you’ve heard change is afoot in the legal services business. If you haven’t, this must be the first issue of this magazine you’ve ever read.

But have you heard that there are faint indications that the ethics rules may be starting to reflect some of those changes? I’m not shocked if you haven’t. Only glaciers envy the speed of change in the ethics rules.

Less than a year ago, in August 2018, the ABA significantly amended the lawyer advertising rules, putting rational client protection above protection of lawyers. Those rules are now under consideration in a number of jurisdictions. One jurisdiction—Virginia—jumped the gun and in 2017 adopted new slimmed-down ad rules much like those proposed by the ABA. The ice may be starting to crack.

Why They Matter

Nothing about the law business has changed more over the last few decades than the way we market.

In the 1970s state-of-the-art marketing was the massive multivolume Martindale-Hubbell Law Directory, engraved business cards and finely printed cards announcing the opening of practices and new partners. (Youngsters, feel free to ask your elders about Martindale-Hubbell.) Contrast that with today’s multimedia, multiplatform carnival of marketing options.

Way back when, few lawyers cared about the ad rules, much less the ad rules in multiple jurisdictions. Today more than ever, many lawyers work and market across state lines.

Pity the poor lawyer who wants to do basic marketing across even one or two state lines. No topic has generated a more divergent and confusing set of lawyer regulations than advertising. It’s regulatory chaos. The ABA’s summary of just the various jurisdictions’ ad rules runs to more than 100 pages.

Add to that ridiculous and unnecessary variation the extreme difficulty of applying 1970s and 1980s ethics rules to Facebook and Twitter. Or “geofencing” (look it up).

And there’s just no question that some ad rules on the books violate the First Amendment.

Oh, and did I mention that the existing ad rules are basically not enforced in many jurisdictions?

Actual Evidence

As a part of its effort to lead the change in ad rules, the Association of Professional Responsibility Lawyers, the national organization of ethics lawyers—yes, I lovingly call us “ethics nerds”—gathered from bar counsel nationwide actual evidence of how the existing ad rules are used and enforced.

Some bar leaders—but few ethics nerds or bar counsel—were surprised to find out that:

• Disciplinary complaints about lawyer ads are rare.
• The overwhelming majority of bar complaints on lawyer ads that are filed are not filed by consumers but by other lawyers.
• Most complaints are handled informally, even where there is a provable rule violation.
• Few states put resources into active monitoring of lawyer ads for compliance.

Most of the substantive violations disciplinary counsel had seen could be fully handled by just enforcing ABA Model Rule of Professional Conduct 7.1’s current straightforward ban on false and misleading communications.

Changing Worldviews

I once had a partner—a great lawyer and a fine man—who sincerely believed that you could precisely date the downfall of the American legal profession to the 1977 U.S. Supreme Court decision in Bates v. State Bar of Arizona, which found lawyer advertising to be speech protected by the First Amendment. To my late partner, law as a business and law as a profession were mutually exclusive worldviews.

That worldview—that lawyer advertising was completely antithetical to law as a profession—lay at the heart of the hostility of many bar leaders and state supreme court justices to lawyer ads. It was also the foundation of the onerous advertising regulation embedded in our ethics rules for decades now. That foundation is crumbling, and I submit that the reaction to these recent changes to the ABA Model Rules of Professional Conduct on lawyer advertising reflects a tipping point in the debate over the reaction of self-regulation to the epic changes in the law business. That could be good news.

These new lawyer ad rules ultimately passed the ABA House of Delegates with little dissent. But that’s not the only basis for my conclusion that we have crossed a tipping point.

One Funeral At A Time

More importantly, in the years of discussion leading to the ABA’s changes among bar leaders who are not ethics nerds like me, the old worldview was pretty much nonexistent. After the reliably conservative Commonwealth of Virginia radically narrowed its lawyer ad regulation in 2017, I witnessed a remarkable lack of debate or protest among bar presidents. (I was one then.) Where had my late partner’s soul mates gone?

Indeed, proponents of the ABA Ethics Committee’s proposed changes met with some criticism from some quite respectable quarters asserting that the relaxation of the ad rules did not go far enough.

Maybe minds have changed. Certainly evidence of the lack of utility of most lawyer ad rules has been gathered. But lawyer attitudes toward lawyer regulations may well be like science. Paraphrasing the physicist Max Planck, science advances one funeral at a time.

The New Rules

Here’s a quick tour.

Five old Model Rules are now combined into three—what were Rules 7.1 through 7.5 are now Rules 7.1, 7.2 and 7.3.

Rule 7.1 continues to be the broad central ban on false and misleading communications and incorporates new Comments to cover the substance of current Rule 7.5 on law firm names and other topics.

Revised Rule 7.2 contains several specific provisions about lawyer communications.

The Rule permits nominal “thank you” gifts that are not quid pro quo payments for referrals. This will permit lawyers to take a client or referral source golfing or to dinner without running afoul of the Rule’s prohibition against giving anyone anything of value for recommending the lawyer.

The “certified specialist” criteria moved from old Rule 7.4 into Rule 7.2.

The requirement that all advertising contain a law firm name and address is updated to permit advertising to include “some contact information”—not just the address.

Rule 7.3 addresses direct solicitation, actually defining solicitation for the first time in the black letter. This definition also moves the line on prohibited conduct a bit, now banning only “live person-to-person contact,” as opposed to the old “in-person, live telephone or real-time electronic contact.” This takes chat rooms and texting out from under the ban.

It continues to prohibit direct solicitation of potential clients unless they are family members, prior clients, other lawyers or—and this is new—businesspeople who “routinely” hire lawyers for business legal advice. This exception already existed in some form in a few jurisdictions.

New Rule 7.3 also eliminates the requirement that direct mail letters contain an “advertising material” label because there is no empirical evidence showing the need for this disclaimer anymore. The Ethics Committee noted that a number of jurisdictions don’t require such labeling, and a few apparently never did.

Most importantly, what has always been the core lawyer ad rule—Rule 7.1—continues to ban false and misleading lawyer ads.

A Word About Process

The way these changes came about bears noting. It was not the ABA that took the first step toward reform.

Instead, the Association of Professional Responsibility Lawyers, relying on the evidence from its survey of bar counsel, prepared and presented to the ABA a solid draft set of revised ethics rules.

The ABA Standing Committee on Ethics and Professional Responsibility reviewed the evidence, labored over the draft rules, sought comment from every corner of the ABA and the profession, and revised and redrafted. That remarkably inclusive process, and the Ethics Committee’s responsive and able drafting, led to credible, workable and dramatic revisions to the ad rules.

Now it’s up to the states.

See the August 2018 revisions to the ABA Model Rules of Professional Conduct on lawyer advertising, in final (and current) form here and redlined to the prior Rules here.