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Frederic S. Ury Thomas Lyons Ury & Moskow, LLC Strauss, Factor, Laing & Lyons Fairfield, Connecticut Providence, Rhode Island. The Future Of The Legal Profession. Introduction. Change in every industry is occurring faster than ever before. Law is no exception.
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Frederic S. Ury Thomas Lyons Ury & Moskow, LLC Strauss, Factor, Laing & Lyons Fairfield, Connecticut Providence, Rhode Island The Future Of The Legal Profession.
Introduction. • Change in every industry is occurring faster than ever before. • Law is no exception. • We need to plan our future and not just react to change.
We live in exponential times. • “in the near future the pace of technological changes will be so rapid, its impact so deep, that human life will be irreversibly transformed.” • Ray Kurziwell, The Singularity is Near as quoted in The End Of Lawyers? By Richard Susskind
Let me talk briefly about the forces impacting large and medium law firms around the world. But large firms are being challenged by corporations to consider price reductions and alternative fee arrangements. It is becoming more clear that the law is a business similar to other professional services such as accounting, engineering and finance. In house attorneys are demanding a more efficiently delivered product and are willing to look to other firms to get a less expensive product. Whether the present economic downturn has increased the pressures on these firms to change how they market and deliver services we will have to wait for the recovery to see. What others are saying. • Lawyers will be much less prominent in society than today and, in some walks of life, will have no visibility at all. Source: The End of Lawyers? By Richard Susskind • Within 5-10 years, there will be 10 percent fewer lawyers practicing law in the United States. • Others think there will be 40% fewer lawyers. • www.charlierobinsonfuturist.com
It’s all about delivery. • Legal services are not going to disappear. • They are going to be delivered differently. • Mail: Pony Express to Tweets • Music; news; books; consumer products, and services.
Three trends that are changing the profession. • Globalization. • Technology. • Demographics.
Globalization. • Over one million lawyers in India are willing to work for much less than American attorneys. • Lawyers in India, Australia, and New Zealand are trained in the common law. • They all speak English. • The internet connects them directly to your clients. • India Shuts Its Doors on Foreign Firms—American Lawyer 12-16-09.
Outsourcing. • 40,400 Lawyers jobs lost to India by 2015-CNN October 2005. • By 2010 approximately 36,000 American lawyer jobs will be outsourced to India and by 2015 that number may more than double to 80,000-”The Economic Times” of India. • $5.8 Billion dollars of legal work outsourced to India by 2015—Forrester Research May 2004. • Clients are insisting on outsourcing to save money. • Ethical issues concerning supervision of overseas attorneys.
Competition and fees. • Competition for large firms is coming from all over the world. • Clients expect that law firms will make every effort to reduce legal expenses. • Is the billable hour dead? • Fixed fees; blended rates; result oriented billing. • Not paying first year associates.
Law firm ownership outside the United States. • Australia has two publicly traded law firms. • The UK adopted the Legal Services Act which allows Alternative Business Structures: Multi Disciplinary Practices & passive non-lawyer investment. • Legal disciplinary practices (LDPs) may have up to 25% non-lawyer owners or managers, but not external ownership or MDP. • Borderless practice in Europe and Australia.
General agreement on trade in services. • GATS is a treaty of the World Trade Organization entered into in 1995 and signed by the United States. • Legal services are part of this treaty. • Europe versus United States. • Business clients want their attorneys to represent them anywhere in the world. • As the world recovers from the recession, it will not be business as usual.
US is a net exporter of legal services. • US exported $6.7 Billion of Legal Services. and imported $1.6 Billion in 2007. • Global Law Era By Stephen Gillers, 30 American Lawyer No.10 • Views From an Australian Regulator: Steve Mark, May 27, 2009. • Law firm versus individual attorney regulation in Australia.
Technology. • Clients expect lawyers to use technology to deliver legal services less expensively. • Small firms can compete with large firms for large transactions or complex litigation. • Every law firm no matter what size has the same access to legal resources. • Our clients have the same access to legal resources.
Co-sourcing and technology combined. • Small law firms are banding together to handle the largest types of litigation. • Technology allows them to share files and work on millions of documents all around the country without leaving their office.
Virtual law firms and cloud computing. • E-law firms can deliver inexpensive legal services from anywhere in the world. • E-law firms, combined with outsourcing and co-sourcing, can build a nationwide network of law firms. • UPL and regulatory considerations. • Cloud computing and confidentiality.
Why pay for something you can get on the internet for free? • The internet is the primary source for information. Example: www.webmd.com. • Our children have grown up using the internet to research, study, answer questions, shop, socialize, and play. • Easy access to legal answers on the internet will change how people use attorneys. • Music industry, newspapers, and books.
Search is changing access to justice. • True access to justice for all will occur when the ability of computers to search improves to the point where anyone can find answers to everyday legal problems quickly and easily. • Artificial intelligence along with increased search capability. • Connecticut legal aid network. • Google scholar.
Legal open-sourcing. • Same concept as open-sourcing software development. • Clients will share work product prepared by their attorneys with other competitors in a restricted internet site. • Why pay for a document when you can get it for free on the internet? • There is a huge body of legal work in court files which will eventually be on line and available to anyone. • www.jdsupra.com ; www.docstoc.com.
Unauthorized practice of law. • Legal websites and UPL. • Pennsylvania Decision re Legal Zoom. • Todd Janson v. Legalzoom.com, Inc. Ninth Circuit in Missouri Docket # 09-AC-cc00737. • Are UPL laws for the protection of the consumer or to protect the profession from competition? • Total Attorneys, Inc. law suits. • Totalbankruptcy.com. • Department of Justice and Federal Trade Commission.
The brave new world of social web sites. • Ethical issues for Judges and lawyers on Facebook and Twitter. • Privacy issues. • www.legalonramp.com: cross between Facebook and Wikipedia. • The rating of attorneys and judges is going to be no different than that of hotels and restaurants. avvo.com; therobingroom.com.
Demographics. • 55 percent of lawyers are baby-boomers. • The oldest boomers are approaching retirement age. Can they afford to retire? • Fewer lawyers are entering the profession. • The decline in the number of attorneys may be offset by out-sourcing and technology. • How will fewer attorneys impact bar associations and other professional organizations? • Regulating an aging bar.
What is the long term effect of the current layoff of attorneys? • Will the layoff and deferred hiring of lawyers in the United States as a result of the economic downturn escalate the contraction of the number of lawyers practicing law? • When the economy recovers, will those lawyers be rehired or will their former firms turn to outsourcing or other types of technology? • What will law firms look like?
Where do lawyers work? • 74% Private practice • 8% Corporations • 8% Private Industry • 3% Judiciary • 1% Legal Aid/Public defender • 1% Education • 1% Private association • 5% Retired/Inactive Information provided by Hinshaw & Clubertson LLP
Private practitioners. • 48% Solo • 15% 2-5 Lawyers • 7% 6-10 Lawyers • 6% 11-20 Lawyers • 6% 21-50 Lawyers • 4% 51-100 Lawyers • 14% 101 plus Lawyers
Firm size. • 76% 2-5 Lawyers • 13% 6-10 Lawyers • 6% 11-20 Lawyers • 3% 21-50 Lawyers • 1% 51-100 Lawyers • 1% over 100 Lawyers • Statistics provided by Hinshaw & Culbertson, LLP
Did you know? • 1 in 4 workers have been on the same job for one year. • 1 in 2 less than 5 years. • Today’s graduates will hold 10-14 jobs by their 38th birthdays. • Source: “Did You Know” YouTube Video.
Change must start with Law school. • Decrease and deferred hiring of graduates. • School debt is being considered when applicants apply for admission to the bar. • In the Matter of Anonymous 61 A.D.3rd 1214 (2009). • Tell law students what they are facing. • Teach entrepreneurial skills. • ABA approved law schools in Australia and China. • National bar exam. • The US News and World Report effect on law schools and soon Law Firms.
The Professional Code of Ethics. • Multi-jurisdiction practice (MJP) was a cutting edge concept about 12 years ago. • We are practicing law on a 100 year old platform that is out of date. • Ethics 2000 was a 10 year project. We cannot change our rules of professional conduct fast enough to keep up with the pace of change. • Remove restrictions to practicing law in other states and around the world.
ABA Ethics 20/20 Commission. • The Commission’s charge is to review ethics rules and regulations in light of technological advances and globalization. • Is our traditional model of regulation of the profession and admission outmoded? • Virtual law firms; fly in fly out; foreign lawyers; conflicts of interest; cloud computing. • Traditional law firms versus global law firms. • Comments to: ethics2020@staff.abanet.org. • Preliminary Issues Outline: November 19, 2009 on www.ababnet.org/ethics2020.
Bar Association survival ideas. • Offer memberships after those lawyers that are only in the state temporarily. • Develop document databases that allow members to have their own version of Legalzoom.com • Provide meeting/office space for members with virtual practices. • Develop programs to match up new unemployed lawyers looking for experience with organizations looking for free/inexpensive legal help.
