The James Keane Memorial Award for Excellence in eLawyering is awarded every year at the ABA TECHSHOW (March 29-31, 2012, Chicago, Illinois). James Keane was the founding Chair of the ABA/LPM eLawyering Task Force., which grants the Award.

Last year the Award was given to the Legal Aid Society of Orange County for their Legal Genie Project.  Another recipient was Stephanie Kimbro for her pioneering work in developing the virtual law firm concept at KimbroLaw.

The purpose of the award is to recognize law firms, private or public, that demonstrate innovative ways of using Internet technology to deliver legal services. Nominees may be any individual lawyer, law firm, or other deliver of legal services to individuals within the United States. The nominees can be a large or small law firm, public or private, or a legal services agency.  Self nomination by the Task Force is encouraged.

Here is a summary of the Award criteria:

• Absence of precedent - Never been done or done quite this way before.
• Evidence of action - The innovative idea was transformed into action and not merely reflective of best intentions. The nominee should be prepared to provide evaluation data that documents the effectiveness of the legal service in terms of client satisfaction, revenue enhancement, and/or law productivity. The nomination must provide an analysis of the measures used to define success.
• Effectiveness of innovation - There is some measurable outcome that would indicate that the innovation is accomplishing what it was intended to do.
• The project must demonstrate the use of the Internet to deliver legal services.
• Action must have taken place no more than three years prior to this entry, and the legal service must be operating for at least one year prior to submission of the Application.
• Additional consideration will be given to projects that focus on the delivery of legal services to individuals of moderate means.
• The nomination should describe how the service was developed, how it is managed, and how it has been evaluated.
• The nomination should describe how the service can be replicated by other law firms in terms of development costs, required technology, people requirements, and ongoing maintenance costs.

Click here to go to the ABA Application Page to apply.

The application deadline is February 15, 2012.

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The latest edition of the ABA's Law Practice Today webzine has good articles on elawyering and virtual practice and a really innovative piece by Marc Laurtisen titled,  Dancing in the Cloud, and an introduction to the elawyering concept by Stephanie Kimbro --  Getting Started With eLawyering).

I also wrote a short article on Document Assembly Over the Internet , which as readers of this Blog will know is an old theme for me.

For our latest analysis on what is working in the virtual law firm space, download our White Paper on Virtual Law Practice: Success Factors.

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Jay Fleischman in a blog post entitled: “Is the Virtual Law Firm Model Coming up Short?”  states:

"The ABA elawyering Task Force tells us that, “[t]o be successful in the coming era, lawyers will need to know how to practice over the Web, manage client relationships in cyberspace, and ethically offer “unbundled” services.”

Bull---t.

Jay also states:

"Email doesn’t substitute for a phone call.  A phone call isn’t the replacement for a handshake."

"Those who offer the virtual law firm are selling something most people don’t want.  People want to be able to make a personal connection with other people, to build trust in a lawyer’s expertise.  They don’t want to be met with a password-encrypted firewall and triple-redundant backup systems.".

Unfortunately, like some commentators of a well known news network that make up facts and then offers opinions based on those false assumptions, Jay makes up facts to support his point of view.

Jay is entitled to opinion, but not to his own set of facts.

Here are some of the facts:

1. The ABA/LPM's eLawyering Task Force

The eLawyering Task Force , of which I am co-chair (with Marc Lauritsen), through it's web site, publications, and statements has never made the claim that delivering legal services online was the only way that law firms should  connect with clients. The value of an online platform depends on the kind of law practice and the kind of clients served. Clients obviously have preferences that lawyers who serve those clients must respect.

Many firms will have a "virtual component" incorporated into a traditional practice. As Marc Lauritsen puts it,  there will be:

" a shared online environment that is persistent across the life of a matter. For instance, providing interactive questionnaires on their web sites to gather information from prospects and clients, or supplying do-it-yourself document generators, checklists, or calculators.Or opening up a shared space for collaborative deliberation about a particular decision, using interactive visualizations like I 've been promoting under by 'choiceboxing" idea."

In fact, the firms that are getting the most successful results from the addition of a client portal are those that have a traditional practice and who add an interactive online component. 

We know this from the analysis that we have done from observing over 200 law firms that have subscribed to our DirectLaw virtual law firm service during the past two years. We have also learned why some law firms fail to successfully implement an online strategy. We also know that some lawyers have an unrealistic expectation of what it takes to be successful as a "pure play" virtual law firm.

To read the results of our analysis download our White Paper on Virtual Law Firms: Success Factors.

Also see these blog posts on this topic: Online Legal Services: Is it Hype or a New Way of Delivering Legal Services?;  Framing the Discussion About Virtual Law Firm Practice; and Defining the Virtual Law Firm .

2.    Affordable Legal Service and Access to the Legal System

The work of the eLawyering Task Force has always focused on identifying ways in which lawyers can become more productive and efficient by using the Internet as platform for the delivery of legal services and ways in which clients can benefit from the use of Internet technologies in terms of the fees they pay for legal services.

President Bill Paul of the American Bar Association, who created the Task Force, had the idea that through the use of Internet technologies it would be possible to lower the cost of legal fees to make the legal system more accessible to those who cannot afford typical attorney fees.

Instead, rather than the legal profession responding to this challenge, we see the emergence of companies like LegalZoom, SmartLegalForms, CompleteCase, LegacyWriter, Nolo, and the dozens of other non-lawyer internet-based legal solution providers who are responding to the need of consumers  for a ":good enough" legal result at the lowest possible cost. For millions of moderate and middle class consumers the purchasing of traditional high cost legal services delivered on a one to one basis is no longer an option. Their choice is to do the best they can with a legal solution provided by a non-lawyer provider, (which now may be a court or an online legal aid provider).

Jay seems to imply that if a client can't afford the profession's legal fees, then so be it.  Who cares?

My opinion is that it will be harder to justify the profession's monopoly on the delivering of legal services when it only serves a tiny portion of the US population.

The reality is that many of us didn't become lawyers just for the money. We want to serve people and help them with resolve their legal problems. Now there are technologies that can help us do that in a cost effective way and expand the market for legal services.  We shouldn't ignore these technologies, just because we are not practicing law like the last generation of lawyers.

3.  The "Secure Client Portal" Concept":

Examples of Internet based applications range from web enabled document automation, to paying legal bills online, to the provision of written legal advice online, to simply storing the clients legal documents online so they can be referenced later. All of these functions require that the client have access to a secure client portal within which these functions can take place.

It is indisputable that a secure client portal is necessary for secure and confidential activities and tasks between to take place between lawyer and client. This doesn't mean that a lawyer should not use email to provide confidential legal advice which I am sure happens all of the time, at whatever the risks.

On the other hand, it is not possible to pay your legal fee by credit card using email, and I have yet to see a web enabled document assembly solution being delivered through email. For legal work to be done securely online requires a secure client portal.

It us for this reason that the eLawyering Task Force included, as part of the definition of  what constitutes a virtual law practice, that the firm make available to its clients a secure client portal. This seems very obvious to us. Communicating with clients using a mobile phone and by email, is not the same thing as using legal applications online that do legal tasks.

Most people use some form of a secure portal everyday. We do our banking online, our stock brokerage online, buy insurance online, book travel online. It's not rocket science. Except that right now the legal profession is lagging behind every other service industry in the economy in its use of interactive web technology. According to Jay, we should stay where we are and eschew these web technologies. In my opinion, we do so at our peril.

4. Web-Enabled Document Automaton.

Jay seems to think that the use of a web enabled document automation application is not in a clients interest and has little value, or that client's don' t want "just forms."  (It is hard to really know what he believes because of the confused logic that is used to support his argument). 

I think he is wrong about this. He can read our White Paper on Web-Enabled Document Automation as A Disruptive Technology and these blog posts: Document Automaton as a Disruptive Technology  and What Every Lawyer Should Know About Document Assembly.

5  The Legal Profession is Losing Market Share.

Solos and small law firms, with existing methods of delivering legal services, are pricing themselves out of the middle class marketplace. This is the real reason that LegalZoom is rumored to be generating more than 100 million in revenues this year.  LegalZoom and other non-lawyer providers continue to increase their market share at the expense of solos and small law firms.  The assertion that lawyers don't need the people as clients that purchase forms from non-lawyer providers is a misrepresentation of what is really happening in the solo and small law firm marketplace. The clients that are turning away from law firms are clients that law firms need and who they previously served in an earlier, pre-Internet era.

6.     eLawyering Applications are Not Just Tools.

It is not accurate to see state that eLawyering applications are just "tools". In fact they are can be disruptive of the typical law firm business model.  If a consumer can get the result that they want by using a Internet-based legal solution, or "digital legal application" at a fraction of the cost of using an attorney, many will opt for that "good enough" solution. What is important to the consumer, is the legal result, not the fact that they have to go to an attorney to get it.

7.    A  New Generation of Clients is Coming Who Don't Like to Talk on the Phone or Shake Hands With Their Lawyers.

It's is true that many clients are not interested in working with their lawyers online, but we think that as a connected generation comes of age and they have legal problems that they will prefer to deal with their lawyers online and prefer to text rather than even talk on the telephone, much less meet with their attorney face-to-face, unless it is unavoidable.  For facts to support this assertion, see books like New Rules of Engagement: Understanding on How to Connect With Generation Y. and the work of Christine Hassler.

In a study conducted last year by YouGov, a UK-based research and opinion firm,  on consumer preferences for legal services, one of the conclusions was that:

"34% of respondents said they would be more likely to choose a law firm that offered the convenience of online access to legal documents over one that had no online capability; 22% disagreed and 37% neither agreed nor disagreed."

 Younger males were the most likely to choose a law firm with online services and access: 44% of 25-to-39 year-old males (and 40% of such women), along with 40% of 16-to-24 year-old males, would choose a law firm offering online access to documents over another law firm."

There is obviously a generational shift happening.  As a younger generation matures to the age where they have legal problems, their desire to deal with lawyers online becomes a requirement, not a preference.

Summary

These are serious issues for the legal profession. The American Bar Association Legal Technology Resource Center reported last year in one of its technology surveys of the legal profession that only 52% of solo practitioners have a web site. That means that almost half of solo practitioners don't even have a web site. Is it that these practitioners are making so much money that they don't have to even have a presence on the web? Or are we as a profession so out of touch with contemporary trends, that we will have to race even faster to catch up?

So where are we on this spectrum of evolution? Are we still stuck in Web 1.0 with brochure web sites, or are we evolving to interactive web sites that connect with clients who will want to work with their lawyers online or are we still stuck in Internet circa 2002?

Let's expand this discussion, so that lawyers, particularly solos and small law firms, can figure out how to utilize these new technologies to expand and sustain their law practices in an environment that will become increasing competitive. 

Disruptive web legal services such as AttorneyFee.com, Law Pivot,  LegalZoom, are not going away. They will expand and proliferate. The "new normal" is here.

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A  proposed Ethics Opinion of the North Carolina Bar  that provides guidelines for attorneys using cloud computing services, commonly known as SaaS (Software as a Service),  contains language that is troubling because of its potential impact on solos and small law firm practitioners who are creating virtual law practices. The Bar is soliciting comments prior to making the Opinion final. Here are some comments for consideration.

The Opinion states that to comply with the attorney's duty to keep client data confidential there should be:

"a separate agreement that states that the employees at the vendor’s data center are agents of the law firm and have a fiduciary responsibility to protect confidential client information and client property."

 

DirectLaw is a SaaS vendor that hosts law firm data at a Tier IV Data Center that implements the security controls that a bank or major financial institution uses.  The idea that our data center would enter into an agreement that would make its employees agents of a law firm is not realistic. There is not sufficient consideration to expose the Data Center to this kind of liability, and there is no way that they would modify their terms and conditions to meet the needs of a single SaaS vendor. I doubt that counsel for the Data Center would ever approve such language. The Data Center would just tell us to take our business elsewhere. Amending the contract terms just for SaaS vendors that service the legal industry is not likely to happen.

There are other approaches to providing assurance to law firms that client confidential data is secure and less burdensome.

I think a better guideline would be to suggest or require that SaaS vendors host their data at a data center that is a Tier IV Data Center.  A Tier 4  Data Center is one which has the most stringent level requirements and one which is designed to host mission critical computer systems, with fully redundant subsystems and compartmentalized security zones controlled by biometric access controls methods. The Data Center should also be SAS 70 certified. The Data Center should also have PCI DSS certification if credit card data is stored within the Data Center. With these safeguards in place,  a law firm should be  considered to have undertaken reasonable due diligence to satisfy the obligation to insure that client data will remain confidential.

There are other problems with the North Carolina opinion. Another guideline:

"requires the attorney to undertake a financial investigation of the SaaS vendor: to determine its financial stability."

What does that mean? I am not about to divulge our private financial statements to just any lawyer who inquires. How is it relevant? If there are provisions for data capture and downloading data that is stored in the cloud, and the law firm has access to that data, what difference does it make if the SaaS actually goes out of business?

It would make more sense to simply require that a SaaS vendor carry Internet liability insurance for the benefit of its law firm clients. Law firms will have problems securing Internet Liability Insurance to cover data loss. Data loss as a result of a Data Center outage is not normally covered under a law firm's malpractice policy. For solos and small law firm's securing this kind of coverage would be a burden and cost prohibitive. It makes more sense to require the SaaS vendor to secure such coverage and make its law firm subscribers a beneficiary of the coverage.

Another guideline states that:

"The law firm, or a security professional, has reviewed copies of the SaaS vendor’s security audits and found them satisfactory."

How much does such an audit cost? Can solo practitioners afford such an audit? Who qualifies as a security professional? I think this requirement will act as deterrent to solos and small law firms who are seeking cloud-based solutions that they can use in their practice. I think that a less costly and more effective solution would be for an independent organization to issue a Certificate of Compliance to the SaaS vendor indicating that the SaaS vendors has satisfied or complied with well recognized standards. Like the Truste Certificate in the privacy area, this would give solos and small law firms this would provide stamp of approval that minimum standards have been satisfied. This would move the cost burden of undertaking due diligence to the SaaS vendor, rather than to the solo or small law firm practitioner.

Another guideline states:

"Clients with access to shared documents are aware of the confidentiality risks of showing the information to others. See 2008 FEO 5."

This guideline should be clarified because it is not clear what "shared documents" means. This kind of statement is likely to scare clients into thinking that a law firm that stores client data on the the Internet is putting the client's data at more risk than storing the data in a file cabinet in the lawyer's office.

As the American Bar American,  through its Ethics 20/20 Commission, and state bar associations adapt ethical rules to deal with the delivery of legal services over the Internet, it is important to consider that the burden of compliance may have a different impact on solos and small law firms, than on large law firms. The rules should not act as a barrier to solos and small law firms exploring new ways of delivering legal services online which are cost effective for both the law firms and their clients.

For a similar point of view see Stephanie Kimbro's blog post on the same topic.

Disclosure: DirectLaw is a SaaS vendor that provides a virtual law firm platform to solos and small law firms.

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A new international bar association was formed last year, based in Miami, Florida, called the Online Bar Association. It is an eclectic group of attorneys some based in the United States and many based internationally, who have come together around a common interest - the online delivery of legal services.

The first inaugural meeting is this weekend, April 29-May 1, 2011 at the Westin Colanade Hotel in Coral Gables, Florida.  Here is information about the meeting and the agenda.

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A new nonprofit organization has emerged to help lawyers assess the safety and security of their law practice environment. The organization is the International Legal Technology Standards Organization and it recently released a set of standards that law firms can used to evaluate:

1. the law firm's internal security standards; and
2. help law firm's make informed decisions about "cloud computing" vendors and other hosting arrangements where confidential data is stored outside of the physical office of the law firm

The Standards are much more detailed and comprehensive than the ABA/LPM's eLawyering Task Force publication of Cloud Computing Guidelines for Law Firms.

Disclosure: I am on the Advisory Board of ILTSO and provided some guidance to the development of the standards.

The standards are being circulated for comment before final publication.

The standards offer a sensible definition of "reasonable under the circumstances" by recognizing that different types of law firms have different security needs, although all lawyers are bound to prevent the disclosure of client data. Law firms are categorized into three types of situations:

• "Bronze - this standard is appropriate in every law practice, including solo practices."

• "Silver - this standard is typically appropriate for firms of more than one attorney, or where circumstances or resources dictate."
   
• "Gold - this standard is typically appropriate for larger firms or those with additional IT resources, or where circumstances or resources dictate."

The idea of categorizing law practice environments into these three categories is a new idea, as some of the standards only apply to the Gold and Silver category. The intent is to recognize that law firms have different IT capabilities and the size of the law firm usually determines how the law firm will approach the problem of securing client and other firm data.

At this point of development, the law firm is responsible for undertaking their own self-assessment. Law firms can apply to the standards to their own law practice environment and if in compliance display the ILTSO seal.

At some point, I can see where ILTSO might undertake an independent assessment of a law firm's security arrangements and if it compliance with the standards, award a certificate like the Truste certification which assesses an organization's privacy policies. A small fee could be charged for this assessment and it would vary depending on whether the type of law firm practice environment is  Bronze, Silver, or Gold. This would give assurance to clients that all reasonable efforts have been taken to secure the confidentiality of their data.

It will be interesting to see how the organized bar responds to these standards, as their are entities both at the state level, and the American Bar Association that are analyzing these same subjects.

The ABA Ethics 20/20 Commission, for example, has been holding hearings on cloud computing and security of data and has released a working paper on this subject.

Just last week, the Commission released its recommendations on outsourcing, which is a process that has an impact on the confidentiality of client data. The recommendations have not yet been posted on the Commission's web site, but the ABA Journal reports that:

"The commission proposes revisions to the Model Rules recognizing that electronically stored information, including metadata, is material subject to confidentiality rules. It also proposed revisions directing lawyers to make reasonable efforts to prevent inadvertent disclosure of information relating to representation of a client."

ILTSO's new standards would give concrete meaning to the definition of "reasonable efforts" and provide a detailed framework that could guide attorney assessment of particular outsourcing and cloud computing arrangements.

A positive impact of having this evaluation framework in place might be the accelerated adoption of technologies, such as cloud computing. Compliance with the guidelines would support a law firm's assertion that the firm has taken all reasonable steps to secure client data to reduce its liability in case of a security breach over which the firm had no control.

An unanticipated consequence might be a slow down in adoption, as the lack of clarity in this area might give many lawyers a reason not to become "early adopters." Many lawyers might choose to wait until standards like ILTSO's are accepted by a broad base of legal organizations and law firms.

Of course, by then, the "real" early adopters will have acquired a first mover advantage over law firms that are still thinking about the subject, to the those firms competitive disadvantage.

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We have been evaluating the experience of law firms that have subscribed to our DirectLaw Virtual Law Firm Platform to determine what are the factors that make for success. Subscribers to our service are mostly solo practitioners and small law firms who are experimenting with this new mode of delivering legal services online. We want to share their experiences as we learn from them about what works and what doesn’t work. When we have exemplary examples of success we will develop case studies from which we all can learn.

All kinds of lawyers have subscribed to our DirectLaw client portal which enables the online delivery of legal services:

• recent law school graduates who can't find a job and forced to hang out their own shingle;
   
• lawyers who want to give up on a physical office for one reason or another and want to try working from anywhere, but still see clients face to face when necessary;
   
• lawyers who think they can copy LegalZoom and get rich quick by simply putting a site up that sells legal forms and documents online;
   
• lawyers who are in transition because they have been terminated by their law firm employer because of the impact of a constrained economy which is not growing;
   
• retiring lawyers, with deep experience and expertise, and who want to transition into a part-time practice, rather than give up the law entirely;
   
• “pure-play” virtual law firms, where the lawyer never sees a client face to face in an office setting or goes to court;
   
• more traditional law firms, and the experienced lawyers that run them, that want to extend their brand online by adding what we refer to as a “virtual component” or a “virtual law firm platform.”
   
• Less experienced lawyers who want to compete against older more experienced lawyers with an online service to distinguish themselves from more traditional law firms in their community.

Each of these lawyers see potential in the “virtual law firm” concept acquiring new clients and serving existing clients more effectively.

Almost all of our DirectLaw subscribers hope to acquire new clients by creating a dynamic, and interactive Internet presence that is more than a passive web site, which is no more than an online brochure.

Some law firms are struggling as "virtual law firms" and are not able to generate new clients and new sources of revenues. On the other hand, we know from our own direct experience in running a virtual law firm since 2003, that the concept can work, and our own success in selling automated legal forms directly to consumers through a network of more than 30 legal form websites, indicates that there is real demand for online legal solutions.

So what are the factors that contribute to success?

1. Your law firm web site needs to be findable on the web.

Our analysis indicates that a major cause of failure for law firms trying to market their services online is a poorly constructed front-end website that is not search engine optimized. DirectLaw’s client portal integrates with a law firm’s front end website and it is through the law firm’s web site that the client finds the law firm, and logs on to their own password protected and secure client space.

If the firm’s web site is not findable on the Internet, the site gets little traffic, which translates into no prospects and no new clients. Most lawyers no little about the art and science of inbound internet marketing and the techniques of how to make their web sites findable. Web design firms that create graphically intensive law firm web sites that look beautiful do a disservice to law firms unless the sites they develop are also search engine optimized and the web design firm stresses the importance of  creating new legal content that is practice specific as a magnet for web traffic.

See: Law Firm Web Site Design: Tips and Techniques

2. You need to have a good reputation as a competent attorney in your community with an existing client base if you are going to make it online. There are some exceptions to this rule, but not many.

A major factor that contributes to online success is having a good reputation in a particular area of legal practice. See Case Study

“Pure play” virtual law firms launched by lawyers who can’t quite make it in the real world won’t make it online.

The most successful use of online virtual law firm technology is demonstrated by law firms who already have a successful traditional practice and a base of clients to draw upon. Online law firm technology enhances the experience for existing clients and increases the productivity of the law firm in serving these clients. Word of mouth referral from existing client’s, sends new clients to the law firm’s web site. New online prospects convert to clients because of the credibility of the attorney in the real world, and the potential for a face to face meeting when necessary. The online technology component complements the offline practice, and vice versa. This doesn’t mean that a “pure play” virtual law firm can’t work; it just requires a special type of practice to make a "pure play" business model work. A "click and mortar" law firm model seems to work best, at least during this period of early development of the online legal services concept.

This is a complex subject  that requires more space than can be contained in a single blog post.

For further analysis and discussion of success factors see: Factors That Contribute to the Successful Delivery of Online Legal Services.

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The James I. Keane Memorial Award for Excellence in eLawyering for 2011 is going to the Legal Aid Society of Orange County for their Legal Genie Project, reports the eLawyering Task Force of the Law Practice Management Section of the ABA, the group that makes the Award.

James Keane was the first appointed Chair of the group, and passed away tragically from cancer six years ago.

Bob Cohen is the long time leader of Orange County Legal Aid, and provided the leadership for this Project. 

This project combines the use of advanced web-enabled document automation technology to generate Chapter 7 and Chapter 13 documents, as well as California divorce pleadings. It is unique because it involves a network of lawyers who provide legal advice, document review,  and other assistance to clients who use the program. The use of Internet technology makes it possible for the lawyers to be involved, and to also get paid a fee, because the entire transaction is made more efficient. The lawyers who participating get the benefit of the Legal Aid brand, and the marketing that results from promoting the project.

The Project demonstrates how a vertical branded network of attorneys, empowered by a robust technology platform, can provide legal services at an affordable fee to individuals who could not normally afford a lawyer.

This is from the Legal Genie website:

 “Legal Genie is a simple, affordable and reliable online service created by Legal Aid Society of Orange County. It is designed for people who do not qualify for legal aid and cannot afford the services of an attorney. It asks simple questions and puts answers on the forms in the correct place.

"Legal Genie is different from other services because it connects you to a licensed attorney on our Lawyers Referral Service panel. The LRS attorney will give you telephone consultations, review your documents and give you legal advice. Legal Genie combines the magic of technology with the help of a professional at a price you can afford.”

The formal granting of the Award will be on April 12, 2011, at a Lunch for all of the attendees of  ABA TECHSHOW in Chicago, Illinois at the Hilton Hotel.

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Private capital is beginning to flow into companies that are operating at the intersection of the delivery of legal services and the Internet.

Total Attorneys, a Chicago-based company,  just announced that they received a multimillion dollar investment from BIA Digital Partners, a Virginia-based venture capital firm. Total Attorneys is most known for the marketing services that it provides to law firms and the recent ethical controversy in some states surrounding the use of pay-per-click advertising on behalf of law firms. (Apparently this controversy has been resolved in favor of Total Attorneys in every state where it was considered by bar ethics committees.)

The company plans to extend its technology assisted services to law firms by expanding its virtual law firm Software as a Service offerings (SaaS).   Total Attorneys mission is to become a leading provider of elawyering Services to solos and small law firms by providing a comprehensive suite of outsourced technology services, from marketing to web-based practice management tools to a robust client portal.

The company licenses virtual law office technology to solos and small law firms as a subscription service, that now consists primarily of a robust suite of "back-office" practice management tools. The pan is to expand the service into a more comprehensive "front-office" client portal, providing a total solution to solos and small law firms.

This expansion would entitle the company to claim that it is a leading provider in the eLawyering space  and it would compete more directly with our own DirectLaw virtual law firm platform service and other web-based companies moving in the same direction.  [ See:  Legal Vendors Cloud Computing Association ] .

The concept of "technology-assisted service" is an interesting category for  the legal industry for it describes a form of outsourcing which combines both a digitally-based service combined with human service. Thus Total Attorneys also provides "virtual receptionist services", and at one point virtual support services to bankruptcy law firms. One management solution for solos and small law firms it to out source to independent specialized companies functions which can be done more effectively and at less cost than the law firm can do itself using internal resources.

It is good to see competition heating up in the eLawyering space, which has been moribund for a long period of time.  The eLawyering Task Force of the Law Practice Management Section of the ABA was created in 2000, more than a decade ago. For many  years there was not much to report in terms of the innovative delivery of on-line legal services by law firms. The last 2 years has witnessed an explosion in elawyering industry developments as lawyers adapt to change -- caused by a severe recession, widespread unemployment of recent law school graduates, and the challenges created by consumers who are seeking lower-cost and "good enough" alternatives to lawyers, [such as LegalZoom.]

Competition among a variety of vendors provides choices to law firms.  Competition focuses attention on the fact that delivering legal applications as a SaaS is emerging as a new paradigm for enabling solos and small law firms to access complex Internet technologies at a fraction of the capital cost of developing these applications internally.  Private capital moving into the legal industry will create more choices for law firms, and as a consequence more choices for consumers.

Creative legal outsourcing will enable solos and small law firms to become more productive and survive in an increasingly competitive environment.

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The eLawyering Task Force of the Law Practice Management Section of the ABA is seeking recommendations and applications for the James Keane Award for Excellence in eLawyering which is awarded annually at ABA Tech Show in Chicago ( April 11-13, 2011). This will be the fourth year that the Award has been made. Previous award winners include Stephanie Kimbro for her work in creating the virtual law firm of KimbroLaw and Lee Rosen of the The Rosen Law Firm (both coincidentally located in North Carolina).

The purpose of this Award is to give recognition to law offices that have developed legal service innovations that are delivered over the Internet. The focus of the Award is on the innovative delivery of personal legal services, with special attention given to firms and entities that serve both moderate income individuals and the broad middle class. 

The Award is technology-focused, in the sense that the Award Committee is seeking innovations that demonstrate the concept of eLawyering - which can be  further defined as the delivery of online legal services. Examples of elawyering include the development of online web advisors, expert systems, innovative uses of web-enabled document automation, on-line client collaboration systems, and on-line dispute settlement systems, to name a few examples.

Nominees may be any individual lawyer, law firm or other deliverer of legal services to individuals within the United States.

The nominee can be a large or small law firm, public or private, or a legal services agency. More than one entry may be submitted, and the Task Force encourages self-nomination. The Application deadline has been extended to March 15, 2011.

For further information and an application form see: http://tinyurl.com/48xvcfq

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LegalZoom has been beta testing a concept which links its marketing capabilities to a network of law firms that offer legal services under the LegalZoom brand. With some state bar associations accusing LegalZoom of  the unauthorized practice of law,  it might makes sense for the company to seek deeper alliances with networks of attorneys who are able to offer a full and ethically compliant legal service. Solos and small law firms, leveraging off the visibility and prominence of the LegalZoom brand, could reduce their marketing costs and enable these firms to better capture consumers who are part of the “latent legal market”  on the Internet. It could be a win/win for both parties.

Unfortunately, linking the capital and management resources of profit-making organization with private law firms is almost impossible in the United States, given the regulatory framework that governs law practice. Unlike, the United Kingdom, which is in the process of deregulating the legal profession, enabling profit-making companies, from banks  and insurance companies to retail chains like Tesco,  to actually own a law firm, and/or split legal fees with a non-law firm, these practices in the US are strictly taboo.

In the US, law directories can charge a flat marketing fee for a listing, but sharing legal fees with a marketing organization can get you disbarred.

During the dot-com boom around 1999-2000, a company emerged by the name of AmeriCounsel that tried to create a hybrid organizational structure similar to the LegalZoom experiment. The company sought to enable a network of attorneys to offer legal services at a fixed and reasonable price and to mediate between the consumer and the law firm in terms of guaranteeing the quality of the legal services offered. The company failed during the dot-com bust for various reasons, including lack of financing, but on the way to failure, secured some opinions from state bar associations that blessed their model and provides a blue print for hybrid delivery systems which combine the expertise of a law firm with the marketing, management, and technological resources of a non-law firm.

One such opinion was issued by the Nassau County Bar Association New York State.

The Bar Association reasoned that the AmeriCounsel scheme was permissible because:

[S]ince AmeriCounsel does not charge attorneys any fee and since AmeriCounsel does not “recommend” or “promote” the use of any particular lawyer ’s services, it does not fall within the purview of DR 2-103(B) or (D). Rather, AmeriCounsel is a form of group advertising permitted by the Code of Professional Responsibility and by ethics opinions interpreting the Code.

In this model, AmeriCounsel provided technology and administrative services to link the client with the lawyer, but the law firm made no payment to AmeriCounsel. Instead, a separate administrative/technology fee was paid by the consumer to AmericCounsel for using the web site and gaining access to the lawyer. (This is not a practical scheme in today’s web environment, in my opinion), Moreover, AmeriCounsel did not choose the lawyer. The client was able to compare the credentials of different attorneys and choose their own lawyer. Thus no legal referral was involved, which would not be permitted in New York, as only an approved non-profit organization can make legal referrals.

In my opinion, this model, forced on AmeriCounsel, by the Rules of Professional Responsibility, is cumbersome, hard to implement, and was not economically viable for AmeriCounsel. Perhaps this was one of the causes of its failure.

Almost a decade later, companies that want to enter into this kind of hybrid relationship with lawyers, have to follow the same rule structure, as the ABA Model Rules of Professional Responsibility as the rules have not changed in any significant way. changed.  It will be interesting to see whether the ABA Ethics 20/20 Commission, which was set up just last year, will address these issues at all.

Perhaps there should be a “safe harbor” that enables organization’s like LegalZoom to experiment with new patterns of legal service delivery that could operate for a limited period of time in a specific state, like California, The experience would be evaluated carefully as a basis for rule and policy change. The evaluation would be aimed to see if client's interests are compromised in any way, and whether the delivered legal service is less expensive, without compromising the quality of legal service.

Instead of creating legal profession regulatory policies that are based on the legal profession's idea about what is good for the consumer, policy could be based on real experience and facts. Experimentation is good. It leads to change, and in other industries improvement of methods and approaches over a period of time.

Of course, I don’t believe that this will ever happen in the US, at least not in my professional lifetime.

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Chrissy Burns, an Australian lawyer produced a PHD thesis in 2007, entitled 'Online Legal Services-A Revolution that Failed?', where she argued that Clayton Christensen's theory of disruptive innovation does not apply to online legal knowledge products and that a "latent market" for legal services really doesn't exist. Ms Burns is presently Director of IT and Knowledge Management at Blake  Dawson so she brings first hand knowledge to her thesis based on her  work with large law firms. In a recent review of her workby Darryl Mountain, an attorney with expertise in document automation, makes the counter-argument  that Ms Burns focus is purely on large law firms and the corporate legal market and overlooks the documented unmet legal needs of the broad middle class and the disruptive response of non-lawyer providers such as LegalZoom which has served generated over a 1,000,000 wills for consumers during the past five years. Mountain cites other evidence that there is a wide and growing latent market for legal services, that Burns has overlooked. Mountain concludes that, " The legal marketplace has continued to evolve since Burns finished writing in 2007. On the retail side of law practice, the revolution is very much alive and people are beginning to resolve legal problems solely through the use of online legal knowledge products."

Mountain also argues that Burns has defined "online legal services"  too narrowly because her definition is limited to knowledge products that solve legal problems without lawyer assistance or involvement. Such products are stand alone applications, such as "expert systems."

Mountain argues that the better model for thinking about disruptive change is to consider how Internet-based legal technology can work together with legal professionals to increase law firm productivity, maintain profit margins, or result in lower fees. Instead off stand-alone, legal  knowledge products, Mountain argues that technology-assisted legal service is likely to become the more pervasive model in the future. Mountain writes:

"The best solutions are often those that combine people and software, whether the people are lawyers, paralegals, or outsourced personnel. "

His review and Burns' thesis are both worth reading for those who follow developments in the delivering of legal services online. 

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Unless you've been asleep for the last five years, you have probably heard of LegalZoom, the California-based, non-lawyer legal document preparation company that claims it has delivered over 1,000,000 wills to consumers, and that it is the largest incorporation company in the country.

LegalZoom is only one of hundreds of Internet-based legal form web sites that have emerged during the last 10 years and which are eating away at the market share of solos and small law firms. LegalZoom has been challenged by some state bars with the unauthorized practice of law, but hasn’t lost a case yet. They are serving thousands of customers who ordinarily would be served by solos and small law firms. They must be doing something that is in demand because they continue to grow at the expense of solos and small law firms.

LegalZoom, and non-lawyer legal form web sites like it, have a business model that consists of the following elements:

• A legal service delivered purely over the Internet;
• No physical offices, and thus no extensive rental costs to pass on to customers;
• Limited services offered at a fixed price that can be easily compared with other providers including law firms;
• The use of web-enabled document automation technology to reduce costs and increase productivity;
• A secure customer portal where clients can execute legal tasks in their own personalized web space;
• Access on their web site to thousands of pages of free legal information on hundreds of subjects;
• Money-back guarantees to comfort consumers; and
• Reliance on informed consumers to do part of the work, often called co-production, such as filing their own documents or executing their documents on their own based on provided instructions to keep costs down.

Consumers don’t seem to care that they are not dealing with a law firm. As lawyers, we know the service they are selling is risky for consumers, but for consumers it delivers a “good enough” result. LegalZoom would not be growing at this fast a rate if they weren’t offering something that consumers want and value.

How to Compete Against Legal Zoom and Other Non-Lawyer Providers

In the new, competitive environment that solos and small law firms face in the current economy, the keys to law firm survival are to expand the strategic options available by opening new client markets, reducing the cost of services, and delivering legal services in a way that distinguishes your firm from other firms in the pack. These strategic options should be mixed with more traditional approaches to differentiation such as specialization within a niche practice area.

It is time for solos and small law firms that offer personal legal services to the broad middle class to rethink their law firm business models. There are many opportunities for incorporating some of the elements of the LegalZoom business model into a more traditional law practice.

To name a few:

• Consider offering "unbundled" limited legal services at a fixed price, both on-line and off-line;
• Leverage a reputation in your local community and a physical office into an on-line brand that is both local to your community and extends throughout your state;
• Add virtual law office functionality to your web site so that your clients can have the option of interacting with you on-line;
• Figure out ways of using Internet-based technologies, such as web-enabled document automation to strip out costs from your overhead structure increasing profitability;
• Figure out how to segment the market offering lower priced services for more routine matters in order to build trust so that when a client has amore complex problems they will turn to you for assistance;
• Emphasize all of the advantages of using an attorney over a non-lawyer forms provider in your marketing materials and your elevator speech. Click here to see one such comparison.
• Use web-based technologies to respond to both prospects and clients within hours rather than days.
• Reduce the perceived risk that consumers have in retaining a lawyer by increasing transparency and structuring forms of performance guarantees.
• Adopt project management technologies to better estimate costs and fees on more complex projects, translating that data into communications that clients understand.

The current depressed economy and its affect on the broad middle class is not going to change tomorrow. It is likely that solos and small law firms, will have to adjust to new pricing and market realities in the future as competition from non-lawyer providers of legal solutions continues to increase. Large law firms serving large corporations may be immune from these developments, at least for a few years any way, but the fact that Big Law is changing relatively slowly should not mask the rapid changes happening to solos and small law firm practitioners that serve consumers and small business.

I heard a report the other day that the volume of wills and estates practice in one state declined by 50% during the past year. I predict that this trend will continue and not reverse itself, despite any improvements in the economy.

Some commentators think that the monopoly will hold. History and the experience of other countries in deregulating the legal profession suggests otherwise.

Welcome to the "new normal."
 

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Last week the New York Times, in it's Your Money column,  did an evaluation of non-lawyer legal form sites that offer wills on-line, including products offered by Legal Zoom and Nolo. The author concluded that a lawyer can still be very helpful:

"... a computer program can’t ask you about your family relationships or tease out complex dynamics, like your daughter’s rocky marriage."

"Still, the biggest risk might be summed up by Phillip J. Kenny, a lawyer in McLean, Va., who said that one client came back to him after looking at a software package and said, “I don’t know what I don’t know.”

A subsequent blog post in the New York Times Bucks  Blog that is linked to the column, discussed emerging online services that provide a lawyer review, or lawyer preparation of a will for a fixed price.  Services that were mentioned include: RocketLawyer, Nolo's Lawyer Directory, and DirectLaw's virtual law firm service for solos and small law firms. The MyLawyer.com web site, that wasn't mentioned,  is another example of a web site that links consumers to law firms that offer "unbundled legal services" over the Internet.

The lawyer review and lawyer assisted document preparation services are an example of how lawyers are learning from non-lawyer web sites to "productize" their services in a way that makes their legal services affordable to a wider range of consumers increasing their market penetration.

If more solos and small law firms followed the lead of the law firms delivering affordable online legal services, eventually the market share erosion from non-lawyer providers would diminish. More importantly, the legal profession could retain and consolidate its dominant position as the primary provider of legal services to the broad middle class. That's a big "if". At this point solos and small law firms continue to lose market share to new market entrants, despite the legal profession's UPL rules.

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Jay Fleischman, who authors the LegalPracticePro Blog, recently had a blog post where he wished "Death to the Virtual Law Firm." His problem is not with the idea of lawyers practicing law over the Internet, but that the term "virtual" is confusing because it connotes that the lawyer really isn't present. In reality, the virtual lawyer is very present as the producer of legal services, perhaps even more so than a traditional lawyer, because there is the potential for 24/7 accessibility.

He argues that this term confuses the consuming public and potential clients.

In my opinion, the idea of a "virtual law firm"  is becoming a way of describing a law firm that delivers legal services in a new and innovative way. The average consumer whose purchasing behaviour  has changed because of the proliferation of non-lawyer web sites on the Internet, such as LegalZoom, understands very well that when a law firm uses the terms, "virtual" or "online" that the firm is offering a service that is often more reasonably priced, more convenient to use, and often delivered at a faster response time than is usual.  Our market research shows that when consumers see the term "virtual law firm", that it means that a law firm is willing to offer legal services in a non-traditional way, usually  "unbundled legal services," and at a fixed price.

Sometimes a term moves into common usage with unanticipated consequences and a different meaning than its common meaning.  For law firms offering online legal services, this is a way for them to differentiate themselves from law firms that offer legal services in a traditional office setting who eschew digital methods.

It is a marketing message that is powerful, because at the present time there are very few lawyers who have learned to harness the power of the Internet to increase their productivity and keep their prices affordable. "Virtual lawyering" communicates a message to consumers that this is not your "grandparents" law firm.

I doubt that consumers think that a virtual lawyer is someone who is just an avatar in http://www.secondlife.com. At some point in the future, delivering legal services online will become common. At the present time it is not, and the online law firms, that use this moniker, are trying to differentiate themselves from from the rest of the pack. There are very few law firms reaching out to the broad middle class with affordable legal services and too few law firms using the Internet as a platform for the delivery of legal services. "Virtual law firms" represent a new category of law firm that are reaching out to a "latent" market of consumers with a new value proposition.

Because the method of delivering legal services over the Internet is shaped by technology, and the underlying technology needs to be carefully examined and evaluated in terms of whether legal services delivered online are ethically compliant, it is useful to be able to treat this activity as a separate category, at least for the purpose of discussion.

Perhaps in the future, lawyers who deliver legal services over the Internet will refer to themselves as "digital lawyers", or "Online Lawyers", and these terms will become synonyms for "virtual lawyers".  For now, the label, "Virtual law firm" and "Virtual lawyers" is a useful way of framing this emerging activity so its benefits and deficiencies can be further examined. Without precision in definition, it is easy for any lawyer who works from home, and who never sees a client face to face, and who simply uses email, to call themselves a "virtual lawyer." 

I think that the Wikipedia definitions of a "virtual law firm" and "elawyering" , are useful as a starting point for understanding this new category of law firm. The only way to advance the "state of the art" is to recognize that the Internet as a platform for the delivery of legal services is something unique that requires careful examination and assessment. That exploration doesn't get very far if we simply lump all law firms into the same category.

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There is a thoughtful discussion going on about the value of adding the capability of offering legal services online to a law firm's business model that was started by Lee Rosen's blog post titled, "What the Virtual Office Advocates Aren't Telling You."  Responses, so far,  include a post by Carolyn Elefant, an astute observer of solo practice, a post from Susan Carter Liebel, the  Founder of Solo Practice University, and a comment by Stephanie Kimbro, the founder of Virtual Law Office Technology, now owned by TotalAttorneys and the author of the recently published book, Delivering Legal Services Online. Lee Rosen is the winner of the ABA/LPM James Keane Memorial Award for Excellence in eLawyering in 2010, and Stephanie Kimbro won the same Award in 2009 for her work in creating her virtual law firm at KimbroLaw. Donna Seyle, a member of the ABA/LPM eLawyering Task Force and a consultant to solo law firms on law practice strategy, also commented on Lee Rosen's blog arguing that there is a great demand for "unbundled" legal services by the middle class.

Lee's argues that in his opinion there isn't much demand by clients for virtual services and that many clients if they want a virtual service are perfectly happy with LegalZoom. He says he has seen, "a survey indicating that many clients prefer a paralegal-provided service to an attorney-provided service, even when both are offered at the same price." Moreover it will be very hard to turn around consumer preferences now that LegalZoom has established a nationwide legal brand.
He also argues that it is very difficult, or not impossible, for a lawyer to generate a stream of income from a purely virtual practice and that a low-end practice doesn't generate the kind of clients that a law firm needs to be successful. Carolyn Elefant makes a similar argument that it is very difficult to generate significant profits from a low end practice unless you have volume which is difficult for the average solo practitioner to create without some capital and the skills to market their legal services on the Internet. I would agree with these points, but whether a solo or small law firm should consider adding a virtual law firm presence to their web site and modifying their business model is really a more complex discussion than can be easily done within the context of a blog post. There is much wisdom in Lee's observations, but the story is more complicated than he makes out.

I would make the following additional points:

1. A virtual law firm as we define it, is one that has a “client portal” where clients can interact with their attorneys online, view copies of their documents, pay their bills online, communicate with their lawyer in a secure space where their attorneys responses are archived and available, assemble documents through an online questionnaire, and access other digital applications. In my opinion, the benefit of using a virtual law firm platform is to increase law firm productivity, law firm transparency, client retention, and client acquisition. These are all positive values that studies of consumers indicate that they want.  It is not the case, as Lee argues, that there is little demand for by consumers for online legal services.  The 1,000,000 wills that LegalZoom claims it has created during the past five years or so, and the dozens (hundreds ?)  of other non-lawyer legal form sites is ample evidence that the legal profession has abandoned the online legal services market to non-lawyer providers.

2. A “client portal” concept is just another tool that enables a law firm to have an interactive presence on the Web which has certain productivity and client communication benefits. It is not a substitute for a law firm developing its own unique business model and market positioning approach which identifies a group of prospects and converts them into clients. Each law firm has to figure out how to integrate these tools into their own business model. For some law firms, this concept is not relevant to their type of practice. For others, it can be another basis for differentiation,  for choosing one law firm over another.  For many law firms, a virtual capability becomes an important adjunct to the regular office based practice, creating efficiencies that only can be created by using the web as a platform for delivery.

Here are a few examples of law firms that are experimenting with online marketing of legal services, offering "unbundled" legal services in a niche area for a fixed price:

• Practical Plans- an On-Line Estate Planning Practice
• Hedeker & Perrilli - SmarterWill - an Online Wills Service of a high end estate planning firm.
• Estate Planning for Single Parents - an Online Wills Service in Tampa, Florida serving a distinct population.
• GranatDivorceOnline.com - an online no-fault divorce service service pro se litigants in Maryland. (one of my web sites).

For other examples, see the Law Firm Directory at MyLawyer.com.

3. If a law firm wants to market to web-based consumers, including members of what we now call the “connected generation” a law firm needs to have a virtual law firm platform in place, as one option for relating and working with clients.  The cost of adding this functionality is now trivial, so there is little excuse for not trying it. We know from our own experience that there are benefits to this approach, as a complement to a traditional office-based practice.

4. LegalZoom and other non-lawyer legal form sites can’t provide legal advice. I can give you many examples from my own virtual law practice where legal advice makes a major difference in legal outcome. Providing just legal forms alone, can sometimes solve a legal problem, but often they do not. The challenge for us lawyers,  is to figure out a way to provide an offering that is price competitive with LegalZoom, but which offers more value.

Moreover, as a profession we should not walk away from the legal problems of moderate income clients. We have skills that will result in better legal outcomes for moderate and middle income clients. As a profession we have an obligation to provide services at a lower price to individuals who can’t afford higher fees and we should figure highly productive methods of serving them. Are we only to serve the wealthy? If so perhaps the legal profession should be deregulated, as it is being done in the United Kingdom, and legal services regulated just like any another service business. This would provide opportunities for many different kinds of providers to provide legal advice and other services which the legal profession now monopolizes. This is the direction that we are heading.

5. Providing a low end, lower priced legal service can be a marketing strategy for providing higher end, higher fee services. A client of http://www.directlaw.com, that is a personal injury firm, is using a low end service to build relationships with prospects so that the prospects turn to the law firm when they have a high value PI case. Some of the DirectLaw law firms give away free legal forms as an inducement to enter into a relationship that results in the purchase of a broader array of legal services.

6. Some lawyers are able to attract a clientele that will be willing to pay $400.00 an hour for a divorce lawyer, but there are not enough of these clients to go around to satisfy all of the divorce lawyers in a state. The broad middle class is seeking less costly alternatives as this level of pricing, and pricing by the hour,  is more than they can afford. There is real demand for "unbundled legal services" at a fixed price. We can see this directly from the weekly increase in traffic at MyLawyer.com , since a Spring, 2010 launch, where virtual law firms offer their services at a fixed price. The success of RocketLawyer , operating in the same market space, is another example that there is real demand for this type of legal service.

7. For many law firms, a virtual offering becomes an important adjunct to the regular office based practice, creating efficiencies that only can be created by using the web as a platform for delivery. It is a component of an office-based practice that can be used to enhance the experience of existing clients with their lawyers.

8. Finally, the cost of adding these technologies to even a solo practice is becoming trivial. We tested a free version of DirectLaw this summer and experienced great demand, so we decided to end it on September 1, 2010, and offer in the future, what we call DirectLaw Basic for a subscription fee of only $49.00 a month for a solo practitioner.

$49.00 a month is not a significant cost for a solo practitioner to acquire a virtual law firm capability. It is low enough for a solo practitioner to experiment and test out the benefits. 

There will come a time, when thousands of solos and small law firms will add a “client portal” to their web sites to power and extend their marketing programs and to enhance the client experience for those clients that are looking for a way to work with their lawyers online. Lee Rosen is correct,  that simply adding a “virtual law firm” capability does not make a marketing strategy, but there are online marketing strategies that can’t be executed without a virtual law firm platform in place.

The delivery of online legal services will continue to expand, I predict, but it is not going to happen tomorrow. As a new generation of clients mature to the point where they have legal problems of their own,  the need of delivering legal services online will intensify.

New innovations take time to reach a tipping point. I remember, very clearly,  when lawyers would not think of using a paralegal, and I remember how long it took for the innovation to mainstream and reach a tipping point. These times are not dissimilar, as the platform for the delivery of legal services is changing, as Jordon Furlong observes.   In all things innovative, patience is a virtue.

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During the summer we experimented with promoting a free Version of the DirectLaw virtual law firm platform, that includes all of the communications, collaboration, and ecommerce functions, but which excludes the document automation functions.

The DirectLaw Free Version is not quite free, because we charge a $99.00 set-up fee to cover our costs for setting up the account and the ecommerce component which enables law firms to bill their clients on-line.

We wanted to see how much demand we would experience for essentially a free virtual law firm platform, without doing much advertising or marketing. We want to see how ready solos and small law firms are to embrace the virtual law firm concept by adding this functionality to their web sites at almost no cost.

To our surprise, demand was much stronger that we had expected and we met our sign-up goals very quickly. Thus we are ending this Free Version Offer, effective August 31. 2010, and replacing it with what we call: DirectLaw Basic.

DirectLaw Basic, which includes all of the same functions as the original Free Version, but excludes the document automation functions and automated legal form libraries.

The monthly subscription fee will be $49.00 a month for a solo practitioner, plus $50.00 a month for each additional lawyer in the firm, if the firm is larger than a solo, up to four practitioners. There is no charge for access by support personnel and no-set-up fee. A free listing in MyLawyer.com, our consumer legal information portal,  is included in the subscription fee. This program is designed for solos and small law firms. Law firms with over 5 attorneys should contact us for a quotation. For additional details see: DirectLaw Virtual Law Firm Free Version.

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The Virtual Law Firm: How to Build Your Practice in an Online World, Friday, August 6, 2019, 2:00-3:15 P.M. Moscone Center

Moderated by Marc Lauritsen
Presented by Richard Granat ,Will Hornsby, Stephanie Kimbro
Co-Sponsored by General Practice, Solo & Small Firm Division, Standing Committee on Delivery of Legal Services

This program will discuss in a panel format the concept of practicing law virtually and how it can enhance an existing traditional law practice, or be a exist as a totally virtual law firm. The program will discuss the benefits of a delivering legal services online and how it can help a law firm acquire clients who are members of the connected/Facebook generation as well as provide more effective services to existing clients. Topics covered will include: what is a virtual law practice; the web architecture for a virtual law practice; online legal service applications, such as web-enabled document automation; ethical issues in the delivery of online legal services, such as confidentiality, security, unauthorized practice of law, client identification and authentication procedures, conflict of interest checking; criteria of vendor selection; the costs associated with setting up a virtual law practice; and marketing your brand and virtual law practice online.

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eLawyering Task Force Meeting, Saturday, August 7, 2010, Hilton Hotel, Union Square, 9:00 - 11:00 A.M.Open Meeting

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20/20 Vision: The Impact of Technology and Globalization on Ethics for the 21st Century Lawyer. August 5th, Thursday, 10:30am, Moscone Center West Room 2016, 2nd Floor. Stephanie Kimbro, a member of the eLawyering Task Force is participating.

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National Conference of State Bar Presidents

Joint Workshop 3A – Keeping Pace with the Evolving Practice of Law
Continental Parlor 7, Ballroom Level, Hilton San Francisco

Ethics 20/20 continues to explore the impact of technology on the practice of law, as well
as global developments that may redefine and expand our ideas about law practice and
how to regulate it. Join us for a discussion of cutting edge ideas that are going to affect
the profession and your members: the virtual law firm, elawyering and cloud computing,
publicly traded law firms and alternative business models for law firms.

MODERATOR
Frederic S. Ury, Fairfield, CT, Past President, Connecticut Bar Association; NCBP
Secretary, and Member, ABA Commission on Ethics 20/20
PANELISTS
Richard S. Granat, Palm Beach Gardens, FL, Founder, President and CEO, DirectLaw, Inc.,
and Co-Chair, eLawyering Task Force, LPM, and Member, ABA Standing Committee on the Delivery of Legal Services
Steven Mark, Sydney, NSW, Australia, Commissioner, New South Wales Office of the
Legal Services Commissioner, and Chairman, Australian Section of the International
Commission of Jurists

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Volume IV of the recently released 2010 ABA Legal Technology Survey Report is devoted to Web and Communication Technology. A section on E-Lawyering reports that 14% of Respondents over all, and 19% of solo practitioners, report that they have a virtual law office or virtual law practice. This question in the survey that deals with with the question of whether a law firm has a 
"virtual law practice" was framed in terms of whether the attorney primarily interacts with clients using Internet-based software and other electronic communications software.

In my opinion, these self-reported responses from attorneys are not meaningful and are much too high to be accurate. The reported numbers are not useful in understanding where the legal profession is in terms of adopting the concept of a "virtual law practice." The reality is that the adoption rate is much lower.

The ABA Law Practice Management Section's eLawyering Task Force (disclosure: I am Co-Chair of the eLawyering Task Force),  defines a "virtual law practice" as one that offers to its clients a secure client portal, as part of the law firm's web site, where the client can log in with a user name and password, and interact with their attorney, as well as consume other online legal services. A virtual law practice is more than simply communicating with clients by email and never meeting with clients face-to-face. In order to have a "virtual law practice" by our definition,  you have to have a web site and a portion of that web site has to be dedicated as a secure portal for clients. Without this distinction, many law firms can claim that they are "virtual law firms" simply because they use email extensively, as the ABA Study seems to imply, giving the impression that integration of Internet technologies as part of their legal service delivery system is much higher than it actually is.

For example, in another question, the survey participants were asked whether the firm has a web site. The solo practitioner group responded that only 52.1% had a web site, but this is the same group that responded that 19% has a "virtual law practice."  By our definition, if you don't have a web site you don't have a "virtual law practice." The only explanation for the discrepancy in these numbers is that the question of " Do you have a virtual law practice?" was phrased so broadly that more law firms where included in the category than should be.

Another question that was asked to determine what kinds of online legal services were offered by the firm was: "Does your law firm offer online document preparation?" 11.4% of solo firms reported that they did. Again this number doesn't make any sense. There were 149 respondents in the Solo category. Only 52.1% actually had a web site, or 77 firms had a web site from which online document preparation could be offered. 11.4% would suggest that only approximately 8 law firms could offer this service. Not only is this number too small to make any meaningful projections in terms of the total number of solo practitioners in the US (more than 400,000), but it is also likely to be misleading. Here's why:

The technological options for offering online document assembly for solo practitioners are very limited. One option is to provide fillable Adobe . pdf forms. But you can't easily use a fillable Adobe .pdf to create a text document such as a Will or a Shareholder's Agreement. The major document assembly vendors such as HotDocs, DealBuilder, and Exari have systems that support online document assembly but the price for licensing these systems is much too expensive for the average solo practitioner. Wizilegal, a new entrant to the field, provides a new low cost web-enabled document assembly solution, but our market information suggest that they have only a small number of users. (Disclosure: DIrectLaw, which sponsors this blog, is one of the few web-enabled document assembly solutions that is offered at a price that a solo practitioner can afford.)

In short, the question about the use of online document assembly should have been phrased much more narrowly, with a field in the questionnaire that would require that the law firm indicate what platform is being used to support online document assembly, and whether it is a third party vendor, or whether the programming was done in-house. My sense is that if the question were asked properly, the number of law firms offering online document assembly would be much lower than actually reported.

Finally, 3% of respondents report that their firms offer expert system on their web sites (compared with 1% in the 2009 survey), including 7% of the large firm respondents. Based on our surveys of law firms from solos to large law firms, this percentage seems very high to me. It is very rare that I come across a law firm web site that actually offers an "expert system" for use by its clients, and I review or check out literally thousands of law firm web sites a year.  Most lawyers don't even know what an "expert system" is! I would like to see a more precise question, where the respondent is required to name the kind of "expert system" they are offering and the url of the web site where it is offered, so that a reviewer could more closely examine what the law firm represents they are doing is in fact the case.

I think that it is commendable that the ABA Legal Technology Resource Center now has a separate section of its annual report just on web and communication technology. The platform for the delivery of legal services is gradually shifting from traditional face-to-face office practice to the Web, but my sense is that the the pace of adaptation is much slower than is being officially reported. This is understandable in a profession that views its core identity as one where clients are dealt with primarily face-to-face. 

On the other hand, our own research on consumer preferences suggests that more than half of consumers would like their law firm to have an online virtual component. Thus, the legal profession continues to lag behind what other service industries offer to their clients and customers online.

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As many of you know who have been following this blog, DirectLaw is a client portal that enables a law firm to offer online legal services. It is not designed as a cloud-based practice management system, such as timekeeping and billing which we view as "back-office" functions, although DirectLaw still incorporates many practice management features. The purpose of the client portal concept is to enable the law firm to work with a client online, rather than just by telephone and face-to-face, and in ways that are powerful than simply using email.

This week, we launched a Free Version of DirectLaw.  We call it "free" because there is no monthly subscription charge, but there is a $99.00 set-up fee to cover our costs in activating a new account.

This is a fully operational platform that includes all of the virtual law platform features except web-enabled document automation and our state specific libraries of legal forms and documents.

Here is what you can do with the "DirectLaw Free Version":
 

• Legal Advice by Phone, E-mail and Web Cam.  Sell any or all of these services on a flat fee basis.  You set the pricing.
• Legal Document Review.  Offer review services and provide advice for existing documents or forms.  Example:  "I purchased a will from LegalZoom.com, and need an attorney to review it."  You quote a fee based on the complexity of work.
• Legal & Court Coaching.  Another legal advice service you can offer on a flat fee basis.
• Online Collaboration Features.  Share and store documents.  Communicate with clients online.  Secure, archived and accessible 24/7.  Works great for existing/traditional clients, as well online clients.
• Calendaring.  Publish important, upcoming dates/events.  Includes an automatic reminder feature.
• Legal Resources.  Publish client-relevant legal information/links.  Information is accessible via the "client space".
• Attorney Dashboard.  Manage all client-related data; communications; selection/pricing of legal services, etc.
• MyAccount. Stores client contact information.  Information is downloadable to Excel spreadsheet format.
• Integrated Credit Card Processing.  Accept online credit card payment for online legal services.
• Legal Invoicing.   Bill clients via the "client space".  Easy, convenient way to offer online credit card payment of legal invoices.  Works great with existing/traditional clients and for online clients where work beyond the scope of limited services is necessary.
• Rapidocs Solo, our Rapidocs document authoring system, is also included, so you see if you can automate your own documents.

The DirectLaw Free Version is to be distinguished from the Free Trial, which is not a fully operational version and is simply a "sandbox" which lets you play around with the DirectLaw features. You can convert from the Free Trial to the DirectLaw Free Version at any  time, and you can upgrade from the DirectLaw Free Version to Levels I, II, and III at any time. Click here to see the differences between the three levels of service and the different levels of pricing.

We decided to introduce the concept of a Free Version with the idea of accelerating the adoption of virtual law firm concepts by solos and small law firms. Our marketing data, based on analyzing Google Key Word popularity in this market space, such as "virtual law firm," "online legal services", and "virtual law firm,"  shows a relatively low hit rate compared to other trends in the law firm technology market space. We will provide more details of this analysis in a later post. What it says to me is that the number of lawyers, particularly solos and small law firm lawyers, who are simply just interested in learning more about the"virtual law firm" concept is a very low percentage of the total addressable market. This is typical of the way in which the legal profession adapts to new technology - - very slowly. Thus we think the concept of a "Free Version" of DirectLaw can be an important learning tool for lawyers who are interested in moving their law practices onto the Internet. By making this proposition a "no-cost" experiment, law firms can witness first hand how operating on the Internet can enhance their law practice and increase law firm productivity.

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Jason Goita, who operates a Florida state-wide virtual law firm, using our DirectLaw technology,  from his base in Tampa, Florida, has just spun off a second virtual law firm web site that is focused on Estate Planning for Single Parents. This is a good example of how to develop a niche focus within a general area of law. In a crowded market, like the legal profession,  the best way to get noticed is to develop a narrow area of expertise and to focus like a rifle shot on a particular group of clients. When you target a market segment precisely you have an opportunity to gain a client's trust and build a relationship, paving the way for selling other legal services. The site is also very well designed as it doesn't over load the visitor with too much information, guiding the user through a dialogue that leads to purchase of legal services.

A great discussion on the benefits of developing a niche practice as the corner stone of a law firm marketing strategy appears in David V. Lorenzo's Rainmaker Lawyer marketing blog at Law Firm Marketing and the Benefits of a Narrow Practice Niche.  Lorenzo states that there are at least four good reasons to develop a narrow practice niche: (1) perception of expertise; (2) client confidence; (3) experience; and (4) competitive advantage. Lorenzo says:

Focusing your law firm marketing in a narrow niche will help you attract more clients, gain their confidence and respect quicker and it gives you a competitive advantage.  Start thinking of a way you can narrow your marketing focus and you will notice the difference in the clients you attract.

 

In addition to  these four reasons, I would add that if you want to get noticed by Google and the other search engines, the best way to accomplish this objective is to have a narrow focus with targeted key words both on the pages of the website and in the meta-tags on each page of the site.
 

Increasing the firm's visibility in organic search can result in a significant reduction in the cost of pay-per-click advertising. Pay-per-click advertising (e.g. Google AdWords) is, in my opinion, still critical for getting visitors to your site, but a narrowly focused site goes along way towards getting noticed on the web. Moreover, a narrowly focused site is less confusing to visitors because of the singular focus. The mind can only absorb so much text before attention begins to fade. Focus helps keep the Internet-based client focused on the task at hand and streamlines the purchase process.

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The DirectLaw Virtual Law Platform is evolving into what is called a multi-sided and open platform. Our latest feature enables the sales of non-Rapidocs documents and HOTDOCS templates, in addition to Rapidocs automated document templates.

We added this functionality in response to our #1 question from law firms -- "Can I use my own documents?" While this option doesn't have the benefits and efficiencies that our libraries of Rapidocs-based documents provide -- i.e., clients won't be immediately presented with an on-line Questionnaire that will automatically create their docs – firms now have the flexibility to easily put their own documents on the "menu" and convert them to sales.

Moreover, beginning in mid-June, 2010, law firms who have invested in automating their legal forms and documents in HOTDOCS for use on the desktop will be able to serve HOTDOCS Questionnaires through the Web browser via the DirectLaw Platform and charge clients for legal forms bundled with legal advice. We are also in the process of identifying other legal applications created by independent developers that can be served from DirectLaw’s Virtual Law Firm Platform.

The launch of our new consumer portal, MyLawyer.com, provides another side to DirectLaw’s Virtual Law Firm Platform. MyLawyer.com contains a searchable Law Firm Directory, legal information, legal tools such as calculators, and a limited number of free legal forms. 

The inclusion of free legal forms enhances DirectLaw's ability to promote the site most effectively through search engines.  DirectLaw also markets this site via press releases and articles/interviews in relevant media channels to drive traffic to DirectLaw’s network of virtual law firm web sites.  

Designed around the concept of limited ("unbundled") legal services, MyLawyer.com compares the differences between limited legal services provided through a law firm vs. a non-lawyer entity like LegalZoom.com. 

Consumers can easily search for a law firm in their state offering on-line, unbundled legal services, clicking directly through to the firm's MyLegalAffairs "menu of services". 

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This Friday there will be a debate on twitter about virtual law practice between Stephanie Kimbro (@StephKimbro and Brian Tannebaum (@BTannebaum) You can follow the debate at:
 @22Twts and with the Twitter hashtag #22TwDb.

Brian has already launched an opening salvo in response to a blog post that Stephanie wrote just yesterday.  Unfortunately the ABA Journal, which is co-sponsoring the debate, has framed the issue of whether lawyers can dispense with physical office space.

The issue should have been framed in terms of whether on-line legal services delivered through a secure client portal are a valuable adjunct to an existing law practice, and whether a law firm operating purely virtually, with out a physical office can be a viable mode of law practice. It is hard to discuss this complex topic in 140 character sound bites but I am going to try:

Virtual lawyering is about delivering legal services on-line, not about doing away with a physical office, although that is an option.

Virtual lawyering is about relating to clients through a secure client portal where the client signs on with a user name and password.

Within a secure client portal clients can communicate with their lawyer securely, provide data to assemble legal documents, pay bills, etc.

The utility of the client portal concept depends on the type of law practice. I would not recommend it for a criminal defense practice.

Some kinds of law practices require rich face-to-face interactions. Other kinds of practices, can get by with more digital transactions.

One size doesn't fit all, but a physical office is not necessary for some kinds of law practices.

Millions of middle class Americans have turned away from using lawyers to solve their legal problems.

50% of middle income households in the US have at least one legal problem per year. Only 20% seek the assistance of an attorney.

A younger generation with the Internet in their DNA will prefer to deal with their attorneys online.

They prefer to go on-line and use non-lawyer providers like LegalZoom, USLEGAL, USLEGAL and Nolo and other non-lawyer web sites.

These non-lawyer solutions are inadequate but seem to be good enough, for the average consumer.

Unless solos and small law firms wake-up they will continue to lose market share to these non-law firms providers.

Fact: A recent study showed that over half (56%) of consumers expect good law firms to offer legal services online.

The same study revealed that  (47%) of consumers would be more likely to choose a law firm that offered the convenience of online access.

The legal profession is changing. Change is caused by the Internet as a new platform for the delivery of legal services.

@BTannebaum is completely wrong. He doesn't let facts get in the way of his opinions.

@BTannebaum doesn't understand the risks that he is taking by using email to send documents to his clients in his criminal law practice.

The virtual law office issue is not about not having a physical office. It is about providing legal services on-line.

No virtual lawyer that I know has argued that client files should be kept on an IPad while sitting in Starbucks.

There is more danger in keeping records in paper format in the office, than there is storing them in a Tier IV facility in encrypted format.

Does @BTannebaum even know what a Tier IV facility is?  Has he bothered to find out?

@BTannebaum thinks lawyers looking for a better way are whining, when in fact they are looking for a better way to serve clients.

Almost every other industry provides a on-line  client portal for their customers -- except the legal profession.

Virtual lawyering is not for the convenience of the lawyer. It is an approach which is aims to offer legal services at an affordable price.

It is an approach the offers more convenience and a more transparent lawyer-client relationship.

A face-to-face meeting with a client is often optimal, but it is expensive, and clients are looking for cheaper alternatives.

In a criminal defense practice, price is usually no object.

If you are going to lose your license to practice law, price is usually no object.

@BTannebaum is biased because his vision is limited to his kind of law practice. He has blinders on.

@BTannebaum can keep arguing for traditional methods of law practice, while consumers turn away from the legal profession.

Brian Tannebaum (@BTannebaum) stop whining. Wake-up. Its the 21st century.

Stephanie Kimbro (@StephKimbro is a pioneer and a legal rebel breaking new ground in developing new methods of delivering legal services.

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RocketLawyer, a consumer portal linked to a network of law firms has announced that they have secured $6.55 million out of a $7.55 million funding round, according to a regulatory filing.  This is in addition to an initial $2.9 million investment by LexisNexis. It would be interesting to know RocketLawyer's valuation. If the $7.55 million bought 25% of the firm, then RocketLawyer, would be worth upwards of $30,000,000, post-money. If RocketLawyer is generating $6.000,000 in annual volume, then the valuation would be 5 x revenue. Sounds pretty rich. Typically valuations are confidential, but this information could shed some light on how hot the "Software as a Service" legal industry is. 

Dan Nye, former CEO of LinkedIn, has assumed the role of CEO, replacing Charley Moore, the founder of RocketLawyer., who remains as Chairman. (I guess the old adage that the first thing that a VC does when investing in a company is to replace the CEO is true!).

It will be interesting to see how RocketLawyer scales its operation with this funding, and how it develops a strategy to differentiate itself from AVVO and LegalZoom.  As AVVO adds functions to link consumers with lawyers, and as LegalZoom moves towards expanding its referrals to law firms for consumers that need the assistance of lawyers, one can see a certain amount of convergence in these sites. Of course, neither RocketLawyer nor LegalZoom, actually rate or evaluate lawyers, so in my opinion, gives AVVO an upper hand.

Our own legal consumer portal at MyLawyer.com also offers to link consumers to law firms, but the MyLawyer.com Directory only contains virtual law firms that offer legal services online, a niche which we believe will continue to grow. MyLawyer.com's free legal forms and legal documents service is a disruptive move designed to undercut the RocketLawyer and LegalZoom, approach that a consumer should have to pay for a legal form. (Although, our own experience has demonstrated that consumers really like the idea of a person reviewing and creating a legal document even though the person is not a lawyer and can't function as much more than a "scrivener." )

Like "open source" code we believe that the cost of legal forms on the web will continue to decline until pricing approaches zero, and that the real value add while be an attorney's advice and review when it is needed. For an elaboration on this theory, see generally, Chris Anderson' work on , Free - the Future of a Radical Price.  Once a person's situation becomes a bit more complex that the simplest fact situation, it is arguable that some form of legal advice and guidance is required.

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The Ethics Committee of the North Carolina Bar, in response to an inquiry from a law firm, is assessing whether a law firm can utilize "cloud-based" legal applications where client and other law firm data is stored on the Internet.  It could result in a determination that law firms in North Carolina cannot operate as "virtual law firms."

Stephanie Kimbro, the founder of one of the first North Carolina virtual law firms, and  Virtual Law Office Technology, Inc., a web-based virtual law firm services provider, and originally a North Carolina company, (now owned by TotalAttorneys, Inc., which is based in Chicago),  has written an excellent post on this topic.

 "Cloud Computing" enables solo practitioners and small law firms to provide online legal services to individuals and small business at affordable legal fees, and therefore enables them to compete effectively against non-law firm providers, such as LegalZoom, which also operates in "the cloud."

The eLawyering Task Force of the Law Practice Management Section of the American Bar Association has submitted a statement to the North Carolina Ethics Committee on the issue of the relationship of "cloud computing" to solos and small law firms. the delivery of online legal services,  and access to the legal system by individuals of moderate income.

Interested parties who wish to submit comments, should submit them to:

Alice Neece Mine
Assistant Executive Director
North Carolina Bar Association
208 Fayetteville Street Mall
PO Box 25908
Raleigh, North Carolina 27611-5908
EMAIL:  amine@ncbar.gov

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Detroit News just published an article on the decrease in divorces because of the recession - a national trend, and an increase in pro se divorces in Detroit, also a national trend. The article discussed the possibility that law firms could offer "unbundled legal services" as a way of reducing the cost of divorce, but apparently there are very few Michigan law firms that provide this kind of limited legal service.

One law firm in Michigan that is pioneering in offering a reasonably priced limited legal service for divorcing couples over the Internet is Calibre Law, PLC at  Michigan Virtual Law, one of the law firm;s in the DirectLaw network.  Calibre is Michigan's first virtual law firm.  Calibre offers no-fault divorce forms with legal advice for a reasonable fixed fee.

Calibre Law is lead by Edward F. Hudson II. a litigator with experience in estate planning, family law, and small business disputes. Based in Royal Oak, Michigan and launched only a few months ago, Attorney Hudson, plans to have an impact on making legal services affordable throughout the entire Detroit metropolitan area.

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The ABA Ethics 20/20 Commission had public hearings at the ABA mid-year meeting in Orlando. Florida this week-end. A focus of the Commission's work is the impact of Internet technology on the delivery of legal services, both globally and within the United States. The Commission has a 3 year period to undertake research, conduct hearings, and report its findings and recommendations.  Three years from now Internet technology will be further transformed, and by 2020 who knows what technologies will be available. By then, I am sure, legal business (negotiations, dispute settlement) could well be conducted by our avatars in virtual legal environments on an international and cross jurisdictional basis. Licensing of lawyers by states may prove to be increasingly anachronistic by 2020, although it is unlikely that state bars will go away without fight.

I was honored to be able to testify before the Commission and submit a written statement which can be found here. Stephanie Kimbro now a member of the ABA's eLawyering Task Force, also made a presentation on the virtual law office concept which I thought was very well received.  My impression was that the Commission members were very interested in our statements and explanations of how Internet technology enables the more effective delivery of legal services.

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Attorney Louis Pepe, a Connecticut attorney and Chair of a Connecticut Bar Task Force examining non--lawyer legal information web sites, believes that these web sites are breaking the law by providing legal services in a state in which they're not licensed to practice, as reported in the Connecticut Law Tribune.

There are differences between  legal information web sites that provide legal information and legal forms only, and web sites that offer something called "legal document preparation services" where a paralegal or other non-lawyer reviews a document and assists in preparation prior to sending the form back to the client.  Rather than making a distinction between the different kinds of web sites, Pepe's  Task Force lumps them altogether into a single "evil" category. If it's not a  law firm web site, it has no place on the web, at least as far as the Connecticut Bar is concerned.

As reported by the Tribune, "the task force filed its report with the Department of Consumer Protection alleging that the on-line legal providers also were engaged in deceptive advertising because the companies are offering legal advice by providing relevant legal documents."

Can it be that the provision of just a legal form constitutes the "unauthorized practice of law?"  If that were the case why don't we just ban self-help legal software and self-help law books from Barnes & Nobles book shelves? All of the legal information web sites that I know of,  have a clear disclaimer that they are not a law firm and do not purport to give legal advice.

Does Pepe think that a consumer can't tell the difference between an attorney and a legal information web site? Is any publication - whether print-based or web-based -  that is a legal form the "unauthorized practice of law?"

In my opinion, there is a good argument to be made that a legal information web site that states that it's services and products are the equivalent to what a lawyer provides is a misrepresentation. It would be a misrepresentation in advertising, and consumer protection agencies should monitor the claims made by these providers. However, the claim that the mere provision of a legal form is the "unauthorized practice of law" is an abuse of the legal profession's self-regulatory power to protect the consumer from harm.

Catherine J. Lanctot has written an interesting article on the subject in “SCRIVENERS IN CYBERSPACE: ONLINE DOCUMENT PREPARATION AND THE UNAUTHORIZED PRACTICE OF LAW,” 30 Hofstra Law Review 811 (2002, 44 pp, pdf), where she argues that those who wish to apply UPL enforcement against such software products or document preparers ”must not lose sight of the broader implications.”  Not only do they risk constitutional challenges, but :

“[W]e must consider the ramifications of such enforcement. The public reaction would likely be negative. Enforcing unauthorized practice of law statutes against online document preparation services would be neither painless nor popular. The lay public, which already detests lawyers, generally perceives unauthorized practice of law enforcement as yet another way for the legal profession to line its collective pockets at the expense of consumers. . . .

“In addition, it is at least possible that these websites are managing to provide some consumers with a necessary service—basic legal documents at an affordable price. At a time when the bar seems to have abdicated its responsibility to provide routine, noncomplex legal services to the poor and middle class, it could well be counterproductive to try to shut down one vehicle for serving those unmet needs.”

If  the Connecticut Bar can't distinguish between their self-interest in maintaining a monopoly over the delivery of legal services and the public's right to legal information whether in the form of a book, a desk-top software program, or a web-based software program, perhaps the citizens  of Connecticut should either strip the bar of its self-regulatory power, or further define what the "practice of law" means. That is what the citizens of Texas did, when the Texas Bar attempted to ban self-help law books and self-help legal software from being sold in the State of Texas.

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DirectLaw is pleased to announce the opening of a new virtual law practice by Tim Ferraris in Knoxville, Tennessee.   The firm will provide services in the areas of business, family and divorce, estate planning, landlord/tenant, and name changes over the Internet throughout the state of Tennessee.

Tim founded Ferraris Law Group and its unique On-Line Office with the mission of providing convenient and cost-effective legal services to people throughout Tennessee. Tim is passionate about being his clients' trusted legal advisor throughout their lives.

A resident of Knoxville since 1984, Tim obtained a B.A. in Political Science from the University of Tennessee and graduated with high honors from the U.T. College of Law.

In addition to his law practice, Tim serves as Director of "Hit the Road, Leukemia," an annual event that raises funds to benefit blood cancer research efforts.

The online service allows the firm to provide cost-effective legal services so that everyone in the state can have access to affordable legal services.

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The Law Practice Management Section of the American Bar Association is sponsoring a Teleconference on the The Virtual Law Firm: Benefits, Costs, and Ethical Pitfalls to Avoid, on Thursday, December 17, 2009 between 1:00 P.M. and 2:30 P.M.

The program is a Live Audio Webcast with PowerPoint support.

I am participating in the program, together with Stephanie Kimbro of KimbroLaw Services and Marc Lauritsen, President, Capstone Practice, and Co-Chair, eLawyering Task Force, ABA Law Practicement Section .You can register online.

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DirectLaw is pleased to announce the opening of a new virtual law practice by Montreuil & Associates in Macon, Georgia.   The firm will provide services in the areas of business, family and divorce, estate planning, landlord/tenant, and name changes over the Internet throughout the state of Georgia.

The firm provides both traditional legal services and an online legal solution platform to serve new and existing clients. The online service allows the firm to provide cost-effective legal services so that everyone in the state can have access to affordable legal services. Ms. Montreuil says that she is committed to the idea of using the Internet to providing increased access to the legal system.

Renay Bloom Montreuil has an undergraduate degree, magna cum laude, from Youngstown State University and a law degree from Mercer University School of Law. Renay has been a Pro Bono Volunteer for Georgia Legal Services and has worked with Life support as a mentor for woman and youth.  She is licensed to practice law in Georgia and Florida.

For more information see website.

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The eLawyering Task Force,  which is part of the Law Practice Management Section of the American Bar Association has been developing a recommended set of minimum requirements for law firms delivering legal services online.  The draft that has been published is a working draft and we are soliciting comments as we move towards a final document. The draft document can be downloaded here.

The ABA does not have a comment facility on their web site, but comments can be contributed on this blog, well as a discussion group  that has been set up on LinkedIn called Virtual Lawyering.

Any comments that are submitted will be circulated among members of the Task Force.

Disclosure: I am Co-Chair of the eLawyering Task Force

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 DirectLaw is pleased to announce the launching of SlatterLaw its third virtual law firm in the State of Georgia. SlatterLaw will provide online legal services to small businesses and individuals throughout Georgia.

Kerry Slatter founded the law firm with the goal of providing convenient and cost-effective legal services to small business owners and individuals across the state of Georgia. In addition to small business legal services, the Slatter Law Firm also provides counsel in various other areas, including estate planning, corporate law, and employment law.

From the web site:

 "Slatter Law provides the following core values for its clients:

• Customer Service – Provide value and legal solutions to exceed client’s expectations.
• Cost Efficiency – Provide cost efficiencies to enable clients to obtain more value from their legal budgets.
• Responsiveness – Limit attorney workload and the number of clients. The motivation to build long term relationships with clients drives this goal.
• Convenience – Utilize excellent customer services and technology to provide legal services in a convenient manner for the client (via secure online website client space, by email or by phone as needed).
• Innovation – Promote innovation for all aspects of client legal services, including the use of cutting edge technology, resources, and fixed fee arrangements."

Mr. Slatter has an undergraduate degree from Morehouse College and a law degree from State University of New York at Buffalo School of Law and is licensed to practice in Georgia.

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We are pleased to announce the launch of the law firm of Pfau and Associates that will provide online Estate Planning services to Nevada residents. This is the first DirectLaw law firm in the State of Nevada.

Pfau and Associates concentrates solely on the areas of estate planning and probate to ensure the highest quality of legal representation. The firm offers both online digital estate planning solutions and in-office services to provide for the client’s estate planning needs. Among the online offerings are simple living wills and trusts, durable powers of attorney, and advance healthcare directives.

Matt Pfau says that his philosophy is, “We make sure that we are always available to our clients for any type of support that they need. Since the choices that you will make are deeply personal, we will provide you with individualized, one-on-one attention"

Matthew Pfau has an undergraduate degree from the University of Nevada, Las Vegas and his law degree from Wittier Law School. Matthew is admitted to practice before all courts in the State of California and Nevada.  He is also admitted to practice before the United States Court of Appeals for the Ninth Circuit.  For more information visit his website.

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The Law Practice Management Section of the American Bar Association awards the James I Keane Memorial Award in Excellence in eLawyering, annually at the ABA TechShow in Chicago. Nominations are now open for the Award to be in March, 2010. Candidates can self-nominate. The Award Requirements can be found here. The nomination form can be found on-line here.

Here is a brief summary of the Award criteria:

• The project or law firm must demonstrate the use of the Internet to deliver legal services.
• It must be unique. It should be an on-line legal service that has never been done before, or not quite this way before.
• Absence of precedent - Never been done or done quite this way before.
• There should be some measurable outcome that would indicate that the innovation is accomplishing what it was intended to do.
• Action must have taken place no more than three years prior to this entry, and the legal service must be operating for at least one year prior to submission of the Application.
• Additional consideration will be given to projects that focus on the delivery of legal services to individuals of moderate means.
• The nomination should describe how the service was developed, how it is managed, and how it has been evaluated.
• The nomination should describe how the service can be replicated by other law firms in terms of development costs, required technology, people requirements, and ongoing maintenance costs.

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On Friday, October 2nd, I presented at Vancouver’s Pacific Legal Technology Conference on the topic of Virtual Law Practice with Simon Chester of Heenan Blaikie and Nicole Garton-Jones of Heritage Law.

We discussed the two heads of the definition of virtual law practice:  practising law over the Internet through a secure online portal and practising law under one brand through satellite offices (which are often home offices).

Nicole is an early adopter who described her experience in managing Heritage Law, a paperless office where most staff work from home.  Some staff are located in places such as Victoria and the Sunshine Coast that are remote from Heritage Law’s central office in West Vancouver.  Heritage Law soon will be implementing DirectLaw through a separate business model called Heritage Law Online, subject to regulatory approval.

I analyzed Web-enabled virtual law practice using the Eliminate-Reduce-Raise-Create grid, which sets out a framework for contrasting innovative value propositions with conventional value propositions.  It comes from a book called Blue Ocean Strategy.  Among other things, Web-enabled virtual law practice eliminates the visit to the lawyer’s office, reduces cost and waste, raises a lawyer’s reach beyond his or her immediate geographical area, and creates a packaged solution.  I also discussed Chrissy Burns’ PhD thesis, entitled “Online Legal Services—A Revolution that Failed?.”  It is found at http://tinyurl.com/kvtden.

Simon discussed the regulatory issues involved in setting up a virtual law practice in Canada.   Canadian regulators have not addressed virtual law practice specifically but there are issues with regard to limited scope representation, preservation of data, and the client identification and verification rules.

Our PowerPoint slides from the presentation are located here:

http://www.pacificlegaltech.com/download/SSF2.pdf

 Reported by Darryl Mountain, President, Ontago, Inc.

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Virtual Law Office Technology, LLC, (VLOTech) based in North Carolina has been acquired by TotalAttorneys, a well-regarded law firm marketing and management services organization based in Chicago. VLOTech should do well and flourish under TotalAttorneys management umbrella, and with TotalAttorneys' financial backing, VLOTech will continue to be a major player in the emerging market for web technology that enables law firms to deliver legal services virtually. Stephanie Kimbro, the co-founder of VLOTech,  was the winner last year (2009) of the James Keane Award in Excellence in eLawyering, awarded by the Law Practice Management Section of the American Bar Association, for her work in designing and operating her virtual law firm in North Carolina, (which was the prototype for the VLOTech technology).

As many of our readers know, we have been a friendly competitor of VLOTech , through my company, DirectLaw,  a client-centered hosted web service for solos and small law firms , in the sense that the more vendors that are in this space, the less time it will take for these ideas to move beyond early adopters to capture the interest of the mainstream of the profession. My view is that the more competitors in this market space the better, as each will come up with their own unique innovation to respond to the differing needs that law firm's have as they migrate their practices to the web. Our experience is that it always takes longer than we can predict for these innovative ideas to catch the interest of the bulk of practicing lawyers.  Congratulations to Stephanie and her team and good luck with their new partner. Click here for more details.

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There has been some recent blog comments [See: Carolyn Elefant 's Blog  [about  the meaning of Robert Capps article  in this month's WIRED Magazine, (September 2009) about the concept of "Good Enough",  "Good Enough" solutions, (when cheap and simple is just fine). , and my quote about how this concept applies to the legal profession.

When I was interviewed for the Wired Article, I didn't know the focus of the article, and I was simply reporting my experience in offering limited legal services to consumers for a fee they can afford. I wasn't saying at all that lawyer's should do less competent or less excellent work. Rather I was thinking about how legal transactional events between consumer and lawyer can be restructured to get to the "good enough result" that many consumers seem to want.

My best example is one that I participate in daily, and which I mentioned in previous blog post. Divorcing couples opt for a quick settlement, even if they don't get "every right" they are entitled to in the interest of reducing their legal fees and getting on with their lives.

Divorce lawyers can charge from $5,000 - $10,000 (low-end of fee schedule) for even a relatively simple divorce. case. The lawyers will say there are no simple divorce cases. But that is from the the viewpoint of the lawyer. From the consumer point of view, they have a choice to spend $5,000 for each counsel who is representing either party- or to take the money and use it to get on with their lives. The question is--  what is the ROI from the consumer's point of view?  Sometimes the investment of $5,000.00 in legal fees is worth it. ($5,000.00 is really a low end estimate). Consumers don't think so, or there would not be thousands of pro se litigants representing themselves in family court. Pro Se Representation is a good example of a restructuring of the lawyer/client relationship to get a "good enough result." The success of LegalZoom -  admittedly a service which is a very small step above a bare legal forms service is more evidence of consumer preferences.

So is the movement towards "limited legal services." Lawyers, mostly solos and small law firms, that think that otherwise and think that full service representation is the only way to go are not facing consumer reality. These lawyers are living in a dream world.

Consumers want solutions to their legal problems. If they can get legal solutions in a different form than a traditional legal service from an attorney that is "good enough" at much less cost, they will turn away from the legal profession and seek those alternatives if they get a result that satisfies their expectations. 

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The American Bar Association Journal has started a new Legal Rebels project to get lawyers thinking about how to change the legal profession. The Journal recognizes that the legal profession is undergoing structural change accelerated by the current recession, and that as the economy emerges from this recession, the landscape of the legal profession will be very different from the one that we have now know. 

Searching for new ways of practicing law, the Journal will profile 50 or so lawyers who are demonstrating new ways of serving clients by expanding their markets, delivering legal services in a different ways, or creating new styles of legal practice. The plan is to tell the stories of these lawyers through a variety of social media channels using text, pictures, audio and video.

A colleague of mine,  Jeffrey Hughes, was named today in the first group of profiles for his innovative and ground-breaking work in combining a law practice within the context of a coffee house under the Legal Grind brand, serving "legal counsel" and good coffee in a community setting. Legal Grind is an excellent example of delivering "unbundled" or "limited legal services" at prices that people can afford.

By the way, I was honored to also be included in this first group of profiles.

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The month's WIRED Magazine, (September 2009) has an interesting article on how the Internet is enabling "Good Enough" solutions, (when cheap and simple is just fine). I have maintained for a long time that often there is a certain amount of overkill when lawyers tackle a problem, when consumers really want a quick and reasonably priced result. Consumers will often sacrifice securing every "right" they have in order to save thousands of dollars in legal fees. I see this in the divorce area in my online practice all of the time. Often the divorcing parties want to get on with their life at the lowest possible cost. Rather than spend $15,000 in legal fees pursuing every right that the parties think they have, often the best solution is to use the funds that would have been spent on legal fees to invest in their individual futures. The present recession is accelerating these trend.

Lawyers are taught to represent a client "zealously". In fact they are required by the ethical codes of professional conduct to do so -- but at what price. Pursuing every legal angle results in prohibitive legal fees that the average consumer or small business can't afford. There must be a better way to practice law without breaking the bank.

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It has been a very busy summer at DirectLaw. We are constantly adding features to our DirectLaw Virtual Law Firm Platform. Sometimes new features are suggested by our growing network of DirectLaw law firms; often one of our staff gets a good idea and we push it out to the Platform to see what kind of response we get from consumers and our client law firms. The nature of a SaaS (Software as a Service) offering, like DirectLaw, is that we can can modify and enhance the platform at any time and all law firms in the network benefit immediately. Our clients don't  have to wait until "the next quarterly software release."

Here are some of the recently features that have been added to the DirectLaw Virtual Law Firm Platform:

June 17, 2009 - New virtual law firm platform for consumer bankruptcy attorneys released. Click here for more information.

July 13, 2009 -  DirectLaw Workspace™. brings the benefits of web-enabled document automation for clients who are not online by enabling law firms to use our web-enabled document automation system for regular office-based clients.  

July 29, 2009 - A new "collaboration" function that enables law firms to communicate and collaborate securely with their clients over the Internet. Click here for screenshot.

August 5, 2009 - We installed a new "billing" function that enables law firms to bill clients online for traditional legal services and supports online bill payment by clients through their MyLegalAffairs page. Click here for screenshot.

August 20, 2009 - Today we released a new user friendly design for the Legal Services Page ,  which is now available to all law firms in the DirectLaw network of law firms. Each legal service offered by the law firm now appears on a separate tab, with detailed explanations of the scope of the legal service. Legal services offered by the law firm can be added or deleted and the fees charged increased or decreased at any time by the individual law firm using the Attorney Dashboard - the Administrative area that the law firm uses to manage their virtual law firm platform.

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DirectLaw  has announced that the Law Office of Kyle Rhodes, based in Fort Worth, Texas has subscribed to DirectLaw's virtual law firm platform to enable the firm to offer legal services over the Internet to Texas residents. The firm focuses on offering Texas, Wills, Texas Trusts, and other asset protection documents for a fixed price, bundled with legal advice.

This law firm is not a pure virtual law firm as Attorney Rhodes maintains a downtown Ft. Worth office for clients who prefer to meet with him face-to-face. This is a good example of what I call, "click-and-mortal" - combining a virtual law practice with an off-line physical practice.  The market research that we have conducted suggests that the most effective implementation of the "virtual law firm" concept is as an add-on to a office-based practice, as this combines the best of both worlds.

For more information visit the website. The firm utilizes Rapidocs, DirectLaw's web-based document automation system to enable clients to complete online questionnaires which generate documents ready for lawyer review and editing.  This is DirectLaw's third law firm launch in the State of Texas. 

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A colleague of mine, Paula Black has just published a new book for lawyers on how to market themselves and their law firms.  This book should be on every lawyer's desk or night table. You don't get business, unless you ask for it, and Paula Black shows you how to do it. That’s why I am happy to share with you a special opportunity. For the next 48 hours only, Paula is offering a collection of FREE bonus gifts to anyone who purchases this little gem: “The Little Black Book: A Lawyer’s Guide To Creating A Marketing Habit in 21 Days.” Designed to help lawyers integrate marketing into their daily lives, this book is quick, easy and inspirational. By purchasing it within the next 48 hours you will receive special access to information and resources from more than 30 experts. A compilation of advice from some of the most sought-after marketing and management experts in the legal profession, “The Smart Lawyer’s Toolkit” gives you instant admittance to an incredible collection of tips and information. Click here for details…but do it fast!

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 I am offering an on-line course on "unbundling legal services" with a particular focus on how to offer limited legal services over the Internet.  "Limited legal services" is another name for "unbundled legal services."The course begins the week of June 1, 2009 and there will be 7 sessions over a 12 week period. By the end of the course participants will have developed a design for an "unbundled legal service" that can be integrated with their traditional law practice. Topics include: how to "unbundle" legal services by task or by issue; how to create and price an on-line service; marketing of on-line "unbundled legal services"; and ethical and regulatory requirements for offering "unbundled legal services."

For a detailed syllabus go to: Solo Practice University

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We had an eLawyering Task Force meeting at the ABA/Law Practice Management meeting in New Orleans this weekend. We decided to start publishing "best practices" for delivering legal services on-line to the eLawyering web site, and these "best practices" would be available for comment by others. Another project is to develop one or more tele-seminars on eLawyering in cooperation with LPM's Educational Board. A third project, under development is to work with ABA's public relations team to develop a Public Service Announcement that would inform consumers of the risks in using non-lawyer alternatives on the Internet as compared with an on-line or virtual lawyer which offers advantages that a non-lawyer cannot, such as legal advice.

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Stephanie Kimbro, a solo practitioner who operates Kimbrolaw.com, a virtual law firm in North Carolina, has been selected as this year's winner of the James Keane Memorial Award for Excellence in eLawyering. This award is given annually by the eLawyering Task Force of the Law Practice Management Section of the American Bar Association, a group which was founded by Jim Keane an active and long-standing member of the ABA/LPM section who died tragically from lung cancer several years ago. I am the present Co-Chair with Marc Lauritsen.

Ms. Kimbro's law firm is a completely virtual law firm that serves individuals and small business over the Web. Our group concluded that Kimbrolaw.com  met the criteria for the Award perfectly as it demonstrates an innovative online model for delivering services to the broad middle class. Clients access their own individual web space where they can consult with their attorney, have their documents reviewed, and conduct other legal tasks -- all online.

The Award will be formally given to Ms. Kimbro at the American Bar Association's TECHSHOW on April 2, 2009, immediately before the key note speech by Richard Susskind, who will discuss his new book: The End of Lawyers: The Rethinking the Nature of Legal Services.

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The eLawyering Task Force of the Law Practice Management Section of the ABA, had its monthly telephone call on Friday. One of the action items is a renewed interest and commitment to produce a set of best practice guidelines for law firms that want to deliver legal services online. These guidelines would complement the Best Practice Guidelines for Legal Information Web Site Providers that were produced by the eLawyering Task Force and approved by the ABA House of Delegates in 2003. The Legal Information Best Practices Guidelines apply to both law firms and non-law firms and don't deal specifically with issues that lawyers face when they want to deliver legal services online. In some cases it has been reported that malpractice insurance carriers have declined coverage when a law firm attempts to provide legal services directly through their web site. With more law firms embracing the concept of virtual legal practice, it becomes even more important to provide a framework for best practices.  The guidelines would cover such topics as ethical issues in delivering online legal services, security issues, and the attorney/client relationship.

In addition, a new group of software vendors that license "software as a service" {SaaS) have emerged to provide online software applications that support virtual law practice. Some of these vendors include: Virtual Law Office Technology, RocketMatter, Clio, and our own DirectLaw, Inc.,  As part of the guidelines development process, we plan to seek input from this emerging group of software as service vendors.

The goal is to have a draft ready for the discussion by the eLawyering Task Force at the ABA mid-year meeting and then a revised draft for further discussion as the quarterly meeting of the Law Practice Management Section in New Orleans in May, 13- 16, 2009.

Feedback and ideas about what issues should be covered are welcome from all.

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Richard Susskind, in his new book, The End of Lawyers? Rethinking the Nature of Legal Services, devotes a chapter to disruptive legal technologies and identifies automated document assembly as a leading example. A related analysis can be found in a paper produced by Darryl Mountain, a Vancouver attorney, that is titled "Disrupting Conventional Law Firm Business Models Using Document Assembly" Both authors make the point that automating legal documents is one of the major ways that a lawyer can increase productivity, particularly for document intensive practices. Offering these documents over the web directly to clients through a secure client area, where the client completes an online questionnaire increases productivity even more. It is much more efficient than a process where a lawyer or paralegal types data into a desktop windows application manually.

Once the user answers a series of questions that appear in the web browser, a document is instantly created ready for the lawyer's further review and analysis. If the client misses a question, the lawyer can easily communicate by email and request additional information or provide a clarification on how a question should be answered. But that is much more efficient that jotting down the client's answers to the attorney's questions on a yellow pad.

This is consistent with Susskind's analysis that lawyers should automate what they can, leaving to human intelligence what it does best, which is providing legal advice and more customized and individualized drafting. Today automated document assembly solutions  are very robust and can automate very complex documents with multiple levels of "if-then" clauses to accommodate hundreds of different fact situations. Automation of more standardized legal documents should be a "no-brainer."  Using automated document assembly reduces greatly the amount of time the attorney has to spend on an individual document project enabling alternative billing systems that yield a higher margin for the law firm and also potentially lower pricing to the client.

We have seen these efficiencies in our own business activities. Through our affiliate company, Epoq, US, we sell thousands of standardized legal documents a month directly to consumers. Many of these documents are court documents, available for free from court sites, in Adobe .PDF format. Examples are non-contested divorce actions, name change actions, child support modification actions, incorporation documents, and other corporate filings.  By automating these documents and legal forms and adding extensive help screens we add value and make it easier for self-help ("pro se"  parties to complete online.

We know that our legal forms business is taking away market share from law firms, even though we do not provide legal advice and we are selling legal forms only. This is a classic case of "pure-play" disruption. Because the user is "doing"  the work by completing an online questionnaire, and the software does the rest, we have a very high profit margin on these forms, once they are automated. I call this, "making money while I am sleeping."

We also know the limitations of a "forms only" , self-help approach. Our DirectLaw, virtual law office platform, makes our legal forms and automated document assembly technology, available to law firms as a hosted service.  In the law firm configuration, the lawyer can bundle legal advice for legal forms offering a much valued-added offering at a price point which is significantly higher that the sale of automated legal forms only. The lawyer still provides a personal service element, but the document assembly technology enables the lawyer to spend more time with the client because creating the first draft of the document is instantaneous. Moreover, the client is doing part of the work as the lawyer doesn't have to waste time gathering basic factual information which is captured online within a web page. This also can be a very profitable business model. I know from operating my own Maryland virtual law firm , from my home in Palm Beach Gardens, Florida,  just how profitable and satisfying this can be.

I have heard some critics of automated methods remark that lawyers were not trained to be "robots." This perspective misses the point by a mile. By figuring out what parts of a legal process can be efficiently automated, and which parts need to remain the domain of human intelligence, the productivity of the lawyer is greatly enhanced. In the future automated document assembly over the web will become the norm, as it offers the promise of greater value and lower fees or prices.  If not through law firms, then through non-lawyer legal form publishers who have migrated their legal form content to a dynamic and interactive format.

Solos and small law firms ignore these developments at their peril. While many solos practitioners ponder these developments, non-lawyer operated web sites like SmartLegalForms, Wills Online, the Name Change Law Center [ disclosure: We also operate these aforementioned legal form web sites ], Nolo, and LegalZoom, and other non-lawyer sites, will continue to eat away at the market share of the legal profession, particularly solos and small law firms.

It is time for the legal profession to catch up and not cede this piece of business to non-lawyer operators. At the end of the time day, it is the consumer who will suffer by not having access to the legal profession.

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For those of you who are members of the eLawyering Task Force of the Law Practice Management Section of the ABA, this is reminder that there is a Task Force Conference call on January 9, 2009 at 10:00 A.M.

Our agenda includes a discussion on standards and best practices for elawyering and delivering legal services online.

Members of the American Bar Association, who wish to become members of the Task Force should contact Marc Lauritsen, Co-Chair of the Task Force at marc@capstonepractice.com directly. In order to be eligible for membership you also have to be a member of the Law Practice Management Section of the ABA. 

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Recently a prospect for our DirectLaw Web Service asked me whether it was the unauthorized practice of law for a law firm to use a legal document that is generated by our web-enabled document automation system (Rapidocs), because the legal form did not originate within the law firm itself. In this model, a client completes an on-line questionnaire which generates a legal form or legal document instantly ready for attorney review and further modification. I asked my colleague Will Hornsby, who is Counsel to the Standing Committee on the Delivery of Legal Services, American Bar Association, and a leading expert on ethical issues that arise from delivering legal services over the Internet.

Hornsby says that a lawyer commits the unauthorized practice of law when the lawyer assists a non-lawyer, whether that is a person or a corporation, to undertake the practice of law. This leads to the question of whether online document automation that creates a legal form or document from data provided by the client is the practice law. The definition of “the practice of law” varies from state-to-state but frequently includes the drafting of legal documents and the use of legal knowledge or skill. (For specific state definitions of what is the practice of law, or the unauthorized practice of law, click here.

However, the question here revolves around whether the lawyer is “assisting” the software vendor in practicing law when the document preparation is provided as a legal service of the law firm. This is analogous to services provided by paralegals and other outsourced services. In most states, for example, paralegals have no independent authority to provide legal services. If they independently provide document preparation or use their legal skills in serving clients, they may be deemed in violation of their state’s UPL laws, as are any lawyers who assist them in providing those services. [This is the LegalZoom model ]. However, if paralegals provide those same services under the direction of a lawyer and the lawyer assumes supervisory obligations, the paralegal is not practicing law and is not violating UPL laws, nor is the lawyer who provides the supervision “assisting” in the unauthorized practice of law.

ABA Formal Opinion 08-451 (Aug. 5, 2008) clarifies that a lawyer may outsource legal services, subject to several considerations. The opinion directly addresses independent contractors, such as temporary lawyers, but also mentions sources of tasks such as a photocopy shop, a document management company and a third-party vendor for the firm’s computer services. In its discussion of Model Rule 5.5 and the unauthorized practice of law, the Opinion states, “Ordinarily, an individual who is not admitted to practice law in a particular jurisdiction may work for a lawyer who is so admitted, provided that the lawyer remains responsible for the work being performed and that the individual is not held out as being a duly admitted lawyer.”

Therefore, according to Hornsby, and I agree, even if a document automation application would be deemed the unauthorized practice of law if its services were provided independently of a lawyer’s services, once those service or the documents produced by the software application are provided under the lawyer’s direction and supervision, within the scope of the lawyer’s services, the lawyer can no longer be assisting the document preparation in the practice of law and no longer has a risk of assisting in the unauthorized practice of law.

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EssentiaLegal, based in Atlanta, Georgia, and founded by Robert Arrington, Latif Oduolo-Owoo, & Michael Mason, three alumni from large law firm practices in Atlanta, is a new style law firm, part virtual and part physical that is designed to serve the broad middle class with unbundled legal services. The physical office is located in a shopping mall for easy access, but the virtual component is powered by our DirectLaw Service and enables the firm to serve clients throughout the state of Georgia. Clients can complete Questionnaires either on-line, or within the physical office, which results in the instant creation of the first draft of a document or form, ready for the lawyer's review and further modification. Clients have the option of meeting with an attorney at their offices or relating to the firm on purely virtual basis through the MyLegalAffairs application created within the web site by our DirectLaw Web Service. I believe that this "click and mortar" strategy will be ultimately more effective than a purely virtual strategy because clients have the option of face to face contact with their attorney. "Click and mortar" refers to a business model that has both on-line and off-line components.

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We are exhibiting our DirectLaw Web Service at LEGALTECH in New York on February 2-4, 2009. This show is one of the largest legal technology shows involving over 450 legal technology vendors which attract over 13,000 participants. The show is at the New York Hilton at 1335 Sixth Avenue. We are Booth #1621 on Level II.  If you are planning to attend, please stop by for a demonstration of our DIrectLaw Service or just to chat about new developments in the delivery of online legal services. We will be introducing the latest version of Rapidocs, known as Rapidocs 4.0, which is our web-enabled document automation solution that operates totally within the web browser without requiring the downloading of an Active X control, Java Applet, or other software application.  Come see legal documents assembled in real time within the web browser.

Richard Cohen, CO-CEO of EPOQ, our sister company in the London, will also be in attendance and is up to date on new developments to de-regulate the legal profession in the UK and EPOQ's new mylawyer network of web-enabled UK law firms that serve consumers.

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 Myrna Arroyo, a solo practitioner in located in Baton Rouge, Louisiana, who specializes in estate planning, has launched a virtual law firm site that offers wills, living trusts, and other estate planning documents bundled with legal advice for a fixed price. The site is designed to provide an alernative to web sites like LegacyWriter, Do Your Own Will, LegalZoom, and Wills-Online, which offer legal forms without any legal advice. None of these legal form web sites offer documents that are specific to the State of Louisiana because of the particular nature of Louisiana law, which is based on the French Civil Code. Users are able to complete an on-line questionnaire which generates a completed legal document, ready for lawyer review, analysis, and further customization. Web enabled document automation enables saves time in document creation, enabling Ms. Arroyo to provide legal advice with the document for a fixed price. The site is powered by Epoq's, DirectLaw Web Service.

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There has been some recent press about the concept of the virtual law firm.  Craig Johnson has started a web-based law firm called Virtual Law Partners, P.C. The idea is to eliminate the overhead of a physical office or offices and to increase client collaboration over the Internet. I think this is a positive trend and indicates that lawyers are beginning to think about new ways of delivering legal services over the Internet. We would not call this firm, however, an instance of eLawyering, in the absence of digital applications that substitute for the labor of a lawyer -- such as web-enabled document automation. While these pioneering virtual law firms, may be saving the cost of a brick and mortar infrastructure resulting in lower fees to clients, their attorneys still work the same old way which is to bill for their time. Web-enabled digital applications on the other hand substitute for the time of an attorney and are truly disruptive as this time saving feature can result in more radical cost savings and translate into dramatically lower legal fees. We can envision that emerging virtual law firms will incorporate digital applications into their business models creating fixed price service packages for less complex legal services. At that time, these firms will morph into true providers of elawyering services.

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