Since the Model Rules of Professional Conduct were first promulgated by the American Bar Association in 1983, they have been amended several times on an issue-by-issue basis, and the ABA has twice undertaken a more global overhaul.
On the second such occasion, the Commission on Ethics 20/20 was appointed in 2009 to review the Model Rules to determine what adjustments were needed in light of the pervasive influence of technological developments on the practice of law, the increased mobility of lawyers and the increasing globalization (including outsourcing and off-shoring) of legal and law-related work.
Most of its recommendations were adopted by the ABA House of Delegates in August 2012:
The dog that didn’t bark
Perhaps the most important decision the Ethics 20/20 Commission made was to not recommend modifications that would permit non-lawyers to own any interest in a law firm, or to serve as a director or officer or otherwise participate in management. Prior to announcing this decision, the Commission had studied the issue in depth, in light of developments along these lines in Australia, Canada and the United Kingdom.
* Electronic storage of information and electronic modes of communications
The Commission made its recommendations in several clusters, each responsive to a particular theme within its charge.
The first set of proposals concerned the increased use of electronically stored information (ESI) and electronic modes of communication in law practice. Most of the amendments were definitional changes that made the affected Rules or Comments more inclusive of technological developments, without making any substantive changes.
Thus, for example, the old admonition to “promptly return client telephone calls” was replaced with a reference to “client communications.” And the many references to “email” were broadened to include “electronic communications” generally.
Similarly, the issue of what a lawyer should do upon receipt of inadvertently transmitted documents (such as a misdirected fax), now includes discussion of ESI that mistakenly falls into the wrong hands.
The cluster of revisions related to technology also included the addition of a new paragraph to Model Rule 1.6 on confidentiality: Lawyers must make “reasonable efforts” to prevent the inadvertent or unauthorized disclosure or loss of client information — which most commonly occurs though mistakes in using data transmission or storage technology, or inattention to the risk of security breaches.
Lawyer advertising and solicitation
The second grouping of adjustments concerned lawyer advertising, solicitation and contact with prospective clients, chiefly from the point of view of harmonizing the law of lawyering with advances in technology, as in the first cluster.
Thus, for example, the focus shifted away somewhat from communication between lawyers and specific potential clients to more global communications (such as websites). New Comments specifically approve “click-through” online sites, as long as it is made clear that the “lead generator” is not vouching for the quality of the legal services to be provided.
* Outsourcing and off-shoring of legal and law-related work
The outsourcing of legal and law-related work to individuals and entities not affiliated with the originating law firm, including to those both within and outside the United States, was the subject of the third grouping of modifications adopted by the ABA House of Delegates. According to the Commission, that kind of delegation is first and foremost a matter of lawyer competence because both the decision to outsource and the personnel selected to do the work can significantly affect the quality of the representation provided to the client.
At the same time, rules regulating how lawyers deploy non-lawyer resources were obviously implicated, and the Comments to Model Rule 5.3 were therefore tweaked as well.
Lawyers are required to ensure, to the extent possible, that when investigative work, document management and similar tasks are turned over to non-lawyers inside or outside the firm (or outside the country, for that matter), the work must proceed “compatibly” with the professional obligations of the lawyer.
In particular, that means special regard for competence, client confidentiality and communication with clients to facilitate informed decision-making.
Lawyers who have engaged non-lawyers, including outsourced non-lawyers, to assist them have a further obligation to make sure that they do not slip over the line into the unauthorized practice of law. The revised Comments contain further reminders on that point.
Certainly the most far-reaching amendment was the addition of Model Rule 1.6(b)(7), a further exception to the broad rule of client confidentiality established in Rule 1.6(a). The new subparagraph addresses what has long been a Catch-22 at the intersection of client confidentiality and conflict of interest.
When a lawyer is making a lateral move from one private sector law firm to another (and also when law firms are being merged or a law practice is being sold), it is important to take an “inventory” of the client information that is in danger of “moving” into new hands.
But, while disclosing at least a modicum of information related to the representation of former clients is a necessary element of any “conflicts checking” protocol, the affected clients usually have not given their informed consent, and often cannot even be asked to consent without revealing too much about the lawyer and the lawyer’s potential new clients. Nor can it comfortably be said that the former client has “impliedly authorized” the disclosure, because the former client gains nothing from it.
New Rule 1.6(b)(7) solves this dilemma by creating an explicit new exception to confidentiality, expressly tailored to this situation.
Not surprisingly, new Comments added to Rule 1.6 at the same time stress that any disclosure must be limited to the most basic information necessary to perform the conflicts check, and must not be used for any other purpose.
In addition to the adjustments responsive to increased lawyer mobility already discussed, the ABA House of Delegates also approved some minor changes in the suggested protocols for practice in a new jurisdiction while awaiting full admission, and for admission on motion without taking a new bar exam.
A few items on the Commission’s agenda were held over and then approved by the ABA House of Delegates at its February 2013 meeting in Dallas. Chief among these was further authority for non-U.S. lawyers to practice while in the United States.
In addition, two proposals were referred to the Standing Committee on Ethics and Professional Responsibility for the development of Formal Opinions instead of rulemaking. One of them involves the virtual (online and telephonic) practice of law and its implications for rules against the unauthorized practice of law; the other affects choice of law rules in situations when different jurisdictions (including foreign jurisdictions) have different rules regarding imputation of conflicts of interest or the permissibility of non-lawyer ownership of law firms.
William Hodes is a solo practitioner and consultant in legal ethics and the law of lawyering. Based in Indianapolis and Lady Lake, Fla., he is pofessor emeritus of law at Indiana University, where he taught for 20 years. Hodes’ website is www.hodeslaw.com. This column originally appeared in Lawyers USA, a sister publication of The Daily Record.