Titanic Lessons

One of the most enduring dramatic images of the last century was provided by the Titanic. Thought to be one of the most secure human creations, both its builders and those who sailed it saw it as unsinkable. Indeed, books and films about the Titanic's voyage suggest that the principal focus of both passengers and crew was upon what happened aboard the ship itself - who was entitled to eat with the first-class passengers, what the dress was to be for a given evening, which persons were entitled to the captain's time and attention.

With the benefit of historical perspective, we want to call out to all on board that none of those issues ultimately mattered at all. The drama of the Titanic story is that while those on the ship were focused inward, the important events were happening in the environment around them. The significant reality took the form of an iceberg whose impact might well have been predicted if only those in charge had been paying attention.

At the risk of seeming melodramatic, I want to suggest that the legal profession is in the position of the Titanic. My message is not that the profession is likely to sink in 12 hours. The message is, however, that most of our reflections on legal ethics have been so focused on our own history, traditions and interests that we run the risk of ignoring what is happening around us. Indeed, I believe that a failure to give sufficient heed to the environment in which lawyers now work has produced legal ethics rules that in some respects may burden more than benefit both the public and the profession.

LAWYERS ARE NO LONGER 'SPECIAL'
Until a date after many of us became lawyers, the legal profession could get away with looking inward. Ours was a self-regulated profession. Unauthorized practice of law prohibition - often enforced by criminal sanctions - defined the work that only lawyers could do. Within that zone of protected activity, rules of conduct could be established by bar associations working through state supreme courts whose justices had been part of those associations. Legislative and executive branch institutions - the traditional sources of public lawmaking - had relatively little authority when it came to lawyers.

Insulation from outside influence on legal ethics was never complete, of course, but it was nearly so until the 1960s. At that time, the United States Supreme Court started breaking down the special protection lawyers enjoyed. In NAACP v. Button,1 for example, the state of Virginia had extended the traditional ban on solicitation of legal business beyond the usual prohibition of hiring ambulance drivers to pass out lawyers' cards. The state had prohibited contact of potential clients by agents of any person or association that 'employs, retains or compensates' any attorney in a judicial proceeding in which the person or organization 'is not a party and in which it has no pecuniary right or liability.'2

The legislation was not unique to Virginia, which correctly said the prohibition was consistent with Canons 35 and 42 of the ABA Canons of Professional Ethics. Canon 35, for example, prohibited a lawyer's taking direction from a 'lay intermediary,' and Canon 42 prohibited a lawyer's aiding the practice of law by a 'lay agency.' As applied to the NAACP, of course, the provision would have prohibited lawyers from cooperating with the organization's efforts to challenge racial segregation in the public schools.3

The state asserted that lawyers' attempts to obtain legal work is not speech protected by the First Amendment, but the Supreme Court brushed the argument aside. '[L]itigation is … a means for achieving the lawful objectives of equality of treatment … for the members of the Negro community in this country,'4 Justice Brennan wrote for the Court. Whatever the propriety of the ABA canons and the Virginia rules as applied to lawyers seeking pecuniary gain, in this context lawyers' ethical standards enjoyed no immunity from constitutional review.5

Of course, Button was focused on a challenge to ethical standards that uniquely affected the vindication of civil rights, but the Supreme Court refused to so limit it when it decided Brotherhood of Railway Trainmen v. Virginia ex rel. Virginia State Bar6 the very next year. In that case, the union had established a list of lawyers whom it encouraged railway employees or their survivors to consult about job-related deaths or injuries. These were ordinary damage actions from which lawyers sought the 'pecuniary gain' found not to be present in Button. Union members had traditionally been the victims of incompetent lawyers and aggressive claims adjusters, the Court asserted. The union's program was not 'ambulance chasing' and the union was not itself practicing law; it was simply recommending that, before settling their cases, union members consult counsel whom the union had found to be competent. Use of ethical standards to bar such recommendations was held to violate First Amendments rights of both free speech and free association.7

Even more significant in exposing the legal profession to the regulatory environment in which almost everyone else works was the Court's decision in Goldfarb v. Virginia State Bar.8 The issue was validity of a minimum fee schedule recommended by the Fairfax County Bar Association, a voluntary bar, but condoned by the Virginia State Bar, the association with disciplinary authority over the state's lawyers. Although compliance with the fee schedule was said not to be mandatory, the state bar had opined that a lawyer's 'habitual' failure to comply with a local fee schedules would 'raise a presumption' that the lawyer was improperly soliciting cases.9 Whether or not the schedule was mandatory, however, petitioners showed that as purchasers of real estate, they could not find any lawyer willing to conduct a title examination for less than the prescribed fee.

Unlike in the earlier cases, this time the Supreme Court was unanimous.10 In an opinion by Chief Justice Burger, later a critic of 'commercialization' of the legal profession, the Court found the 'voluntary' schedule had the practical effect of fixing prices for legal services in Fairfax County. More significantly for lawyers who thought themselves sheltered from outside regulation, the Court expressly rejected a contention that, as a 'learned profession,' the practice of law is not subject to antitrust constraints. 'The nature of an occupation, standing alone, does not provide sanctuary from the Sherman Act,' the Court said, 'nor is the public-service aspect of professional practice controlling in determining whether § 1 includes professions.'11 'Whatever else it may be, the examination of a land title is a service; the exchange of such a service for money is 'commerce' in the most common usage of that word. It is no disparagement of the practice of law as a profession to acknowledge that it has this business aspect.'12

The combination of First Amendment and Sherman Act attacks made it inevitable that whatever ability the legal profession had to look only inward was gone forever. The coup de grace was inflicted two years later in Bates v. State Bar of Arizona.13 Once again, the case involved the ethical prohibition of solicitation. This time, two lawyers had published a newspaper advertisement describing the services of the 'legal clinic' they had formed to perform routine services such as uncontested divorces, adoptions, name changes and simple personal bankruptcies for relatively low fees.14 The Court's response to arguments that professionalism required prohibition of such advertising was withering:

We recognize, of course, and commend the spirit of public service with which the profession of law is practiced and to which it is dedicated…. But we find the postulated connection between advertising and the erosion of true professionalism to be severely strained. At its core, the argument presumes that attorneys must conceal from themselves and from their clients the real-life fact that lawyers earn their livelihood at the bar. We suspect that few attorneys engage in such self-deception…. In fact, it has been suggested that the failure of lawyers to advertise creates public disillusionment with the profession. The absence of advertising may be seen to reflect the profession's failure to reach out and serve the community.15

The point of discussing these cases is to remind us that the legal profession no longer exists in a protective bubble, and legal ethics can no longer be the business of lawyers alone.16 The legal profession is as exposed to the dynamic elements affecting modern society as the Titanic was exposed to the elements blowing across the North Atlantic.

SOME MODERN REALITIES FACING LAWYERS AND THEIR CLIENTS
The message is that the legal profession should formulate its ethical rules in terms of a more realistic look at the world in which lawyers work and whose changing dynamics they cannot ignore. If the definition of that world were easy, my point would be self-evident. It is always hard to see the present except through experience of the past. Understanding the future is even harder. But to try to give a sense of what I am talking about, I will suggest five elements of present and future reality that I believe will inevitably affect lawyers and their clients. Some of the elements will be easy to recognize; others may be harder to prove and might require future research to validate. If you find my overall thesis persuasive, however, you may come up with your own list of issues as you view legal ethics from a new perspective.

The first and perhaps most obvious modern reality is the increasing scope and complexity of many client activities. A client in Dallas can have customers in Pittsburgh and Prague. The client's products or services, in turn, may be used in Rwanda and Russia. Indeed, a client engaged in e-commerce may do virtual business everywhere in the world simultaneously. Lawyers are simply no longer able to think of their law practice as having an entirely local focus. The day has come and gone when national borders - and a fortiori state borders - have much significance in deciding how a transaction should be structured or a matter litigated.

Obviously, there will continue to be differences in substantive law among the states and in different corners of the world. Jurisdictions will try in various ways to attract investment and to protect their own residents, so legal differences will be inevitable. No lawyer can be expert in all law everywhere, but my point is that even the drafter of a will today must assume that some of the beneficiaries or some of the property could be in other jurisdictions. Greenacre could as easily be in Sydney as in Seattle, and the law governing lawyer conduct must be developed with a skill and imagination that reflects what the new complexity means for 21st century clients.

Second, the world markets in which clients work have produced a degree of competitive pressure unknown when markets were more balkanized. Intense competition will ultimately benefit consumers everywhere, but clients have and will experience new competition in the form of an excruciating need to control costs. Many businesses have laid off whole tiers of middle management, and on the shop floor, robots often do work once done by skilled craftsmen. Making the transition to a global economy has been hard on many people, but it has been necessary in order to keep the clients alive at all. Saying that old ways of doing business would work and old methods remain unchanged has not been an option for our clients.

Up to now, lawyers seem to have been relatively sheltered from this pressure, but that cannot last. Among the major costs clients face are costs associated with transactions and disputes, costs represented in large part by lawyers' fees. The days are over when a CEO could say with a half-smile: 'Our general counsel's office is the only one with an unlimited budget - and it has already exceeded it!'17 Lawyers can talk at bar association meetings about the high-quality service we provide and can judge that quality by professional standards, but the ultimate test for the quality of our services is going to be whether clients find them worth what they cost. That, in turn, will be determined by standards not entirely within our professional control.

A third external reality affecting lawyers is the effort of clients to find ways around some of our traditional standards as they satisfy their legal needs. Clients can be expected to continue to make those efforts when they find it in their interest to do so, and if our professional standards do not address concerns that client responses reflect, the standards may become increasingly irrelevant.

One such client response will be to bring work in-house. Doing so tends to permit clients to avoid what they see as high law firm billing rates. It also allows payment of compensation in the form of stock and bonuses tied more directly to the client's success than hourly rate law firm bills can ever be. Lawyers have understandably been concerned about a loss of independence and possible overreaching associated with too great a financial involvement in their clients' affairs.18 On the other hand, clients can be expected to eschew such concerns if their welfare is enhanced by use of counsel whose rewards can be better linked to the lawyers' contributions to the overall effort.

Yet another client technique for avoiding traditional lawyer standards may be not to use lawyers at all to do things that lawyers have historically seen as the practice of law. Law firms, of course, have long used paralegal and other support personnel nominally working under the lawyer supervision that ethical standards require. Within an organizational client, however, lawyer supervision need only be provided if it is cost effective to do so. Contract negotiation, trouble-shooting discrimination claims, even preparation of court documents can all be done by nonlawyers within an organization acting with a level of lawyer supervision and training to which requirements of legal ethics cannot effectively speak.

Nor is this avoidance phenomenon limited to organizational clients. Legal information and advice is increasingly available to individuals planning their own affairs, drafting their own documents, and even appearing pro se in litigation. Books of legal information have been around for years, of course, but the Internet now makes such information ubiquitous. The legal information website at Cornell Law School, for example, receives over eight million hits each week.19 Some information requests may be from lawyers, but others are undoubtedly from individuals trying to solve their own problems.

Lawyer responses to such developments have not always been realistic. Last year in Texas, an unauthorized practice of law challenge was brought against sale of the Quicken Family Lawyer CD-ROM for use by individuals trying to draft their own legal documents.20 From the standpoint of lawyers, use of such tools seems foolish, but to many of our potential clients, the difference in cost makes it seem sensible. Notwithstanding lawyer views, the Texas legislature promptly took the side of client freedom and made clear that sale of such computer software is not the unauthorized practice of law.21 My point is not to applaud clients' desire to do without our services but to say that the desire is a reality we ignore at our peril in establishing professional standards.

A fourth reality with which lawyers must come to terms is the increasing importance of human capital as a client asset. This point may be harder to pin down but it is based on the idea that clients understand that current expenses are not simply sunk costs if they produce something that can be used again. Experience gained by lawyers who work on a client's matters over time can be such a client asset, whether it consists of an ability to do a recurring task or a broad understanding of the client's interests and objectives.

Once again, I believe this reality helps explain growth in the use of in-house counsel. It also may help explain the experience of many law firms that clients find them to be places to shop for specialized services rather than for general legal advice. An individual lawyer with specialized expertise in a particular aspect of international trade law, for example, is a source of human capital that few clients would find worthwhile to develop internally. Like make-or-buy decisions faced by companies throughout all their operations, lawyers in private practice are most likely to be retained to meet specialized needs at particular times.

If this analysis is correct, we may have to acknowledge that it will become increasingly futile to staff law firms primarily with bright generalists. It may follow that we should expect to see the growth of law firms with a common name but made up of key individuals or practice groups that operate with some autonomy. There is already evidence of that development. We know that in recent years, for example, law firm expansion has often been by acquisition of practice groups theretofore operating independently or as part of competing firms.

We might speculate that the law firms that result from such growth will be less like retail department stores and more like shopping malls, i.e., the firms will share a few common bonds and may operate from under one roof, but in other ways the constituent units will have separate clients and agendas. Growth in law firm attitudes that lawyers may only 'eat what they kill,' i.e., be paid on the basis of billings for which they are responsible, is a predictable result of a sense that practitioners add value to clients primarily because of specialized expertise rather than because of the value of the law firm as a whole.

That reality does not necessarily foreshadow the death of law firms, but it may mean that firms will assume a new role. Practice groups will join large, multi-city organizations in part because of the credible reputation for quality control the firms enjoy. If clients had a good experience using Mary Martin to try a case in Texas, the hope is that they will be more likely to use Nathan Nelson from the same law firm to close the deal in Taiwan. The implication of this analysis would be that clients as well as lawyers will have a stake in ethical rules that permit law firms to exercise appropriate control over their members so as to preserve and develop the value of the reputation that is an asset that benefits them all.

A fifth reality with which I believe lawyers must deal is what seems to be a reduced willingness of today's clients to be loyal to their lawyers. That, of course, in part follows from what I have said before, but in addition, today's clients merge and divide so often - or the managers with whom lawyers deal move elsewhere so readily - that long-term relations tend to suffer. Many lawyer-client relationships have become less like marriages and more like dalliances.

Furthermore, lawyers' ethical rules can be used by clients as swords rather than shields in a quest to seek short-run advantage. It is no longer uncommon for clients behind in payments to lawyers, for example, to accuse the lawyers of malpractice to obtain leverage in the fee dispute. Clients who find it worthwhile to impose costs on companies with which they have a dispute, similarly may seek to sanction the other side's lawyer if ethical rules make that possible.

Some claimed ethical violations are certainly justified, of course, and ethical standards should not be reduced solely because they might be misused. On the other hand, the hit men in gangster movies used to say, 'It's not personal; it's only business,' but that never made the consequences less final. The tendency to use lawyers' ethical standards against them represents a change in the experience of lawyers that is not likely to be reversed. Competitive pressures on clients are such that they could hardly be expected to act otherwise. Lawyers might prefer to practice in an environment they totally controlled, but as ethical rules are formulated, like the crew of the Titanic, lawyers can no longer ignore what is happening in the world about them.22

IMPLICATIONS FOR THE FORMATION OF ETHICAL RULES
If lawyers take a hard look at the world in which they work, they may increasingly conclude that some long-standing rules of legal ethics are irrelevant or even counterproductive. It will be anathema to many to suggest that rules of right and wrong should be subjected to a cost-benefit analysis, but I submit that ethical rules must be. If we fail to ask whether the burdens our rules impose yield commensurate benefits - benefits that could not be achieved with less cost in some other way - the rules will, by definition, do more harm than good.

It is not my intention to offer a complete list of how the Model Rules should be amended in light of the changed world of practice. If I persuade you that such a hard look at the rules in light of new conditions is worthwhile, I will have accomplished my purpose. But to help you see that the hard look might be productive, I will suggest five examples of how ethical rules might change to be made more consistent with the environment in which lawyers now work.

First, traditional jurisdictional limits on the practice of law should be acknowledged as a vestige of a simpler past. Trial lawyers should continue to register with out-of-state courts before whom they practice and be admitted pro hac vice, but transactional lawyers should not be expected to do anything comparable. If a lawyer's Dallas client is working on a contract in Phoenix, the lawyer should be able to fly to Arizona. This may seem obvious; it is what lawyers do all the time. However, charges of unauthorized practice are not unprecedented and can take the form of efforts to avoid paying the lawyer's fee.23 My point is that the fundamental concept of state and even nation-based admission to practice needs to be reexamined in light of what present and future client needs are found to be.24

Second, the day should be seen as long past when lawyers should continue to try to regulate with whom lawyers may practice and with whom they may share fees. I know that the proposals of the ABA Multidisciplinary Practice Commission25 were controversial, but the insights on which the proposals were based are well supported by the facts. The profession has previously engaged in futile - and now largely forgotten - efforts to regulate group legal services, lawyer advertising and minimum fees for services. A hard look at new realities would suggest that efforts such as Model Rule 5.4 to regulate groups in which lawyers may practice are likewise almost exclusively self-protective and almost certainly doomed to fail.

Third, a realistic look at today's practice world might suggest that law firms should have more latitude to give lawyers incentives not to leave precipitously. In the name of not restricting lawyer mobility, Model Rule 5.6 now prohibits many kinds of financial penalties that firms seek to use to discourage moving to another practice setting. Important as mobility is, however, firms must contract for space, hire associates and develop a reputation that only a degree of institutional stability permits.26 The law will not enforce restrictive covenants in any field that are excessive in scope or duration, but there seems no good reason to subject lawyer covenants to greater restriction. Some courts have already acknowledged this view and interpreted away ethical limitations on such covenants, recognizing that the persons who make up a law firm should be capable of reaching arrangements appropriate to their situation.27 Conforming the rules to those decisions would seem to be an appropriate next step.

Fourth, ethical rules might be relaxed that can be used strategically to accuse lawyers of a breach of fiduciary duty in situations not required by protection of core values such as loyalty and confidentiality. As I have argued elsewhere, for example, Rule 1.7(a) that prohibits suing a present client is a rule that uses absolute prohibitions to deal with situations that may or may not present real problems.28 One way to redraft such rules would be simply to make them less absolute; another would be increasingly to recognize contracts in which informed clients give advance consent to what would otherwise be a conflict of interest or other violation of traditional standards.29 Whatever the technique chosen to achieve the purpose, however, gross ethical prohibitions should give way to more nuanced distinctions.

Fifth, the inquiry that I have called for might even suggest that law firms should be able to screen those who have only been peripherally involved in a matter. If I am correct that some firms are increasingly collections of practice groups whose work only partly and occasionally overlaps, screening might be both more practical and more effective than previously thought. Where a lawyer has significant confidential information from prior work on a matter, screening might not be a reliable solution because the former client could not know what was really going on behind the closed doors of the law firm.30 Rule 1.10 paints with a broad brush, however, and consideration of a narrow exception might well be justified.31

RESPONSIVE ETHICAL RULES
In the last analysis, I am suggesting that the legal profession no longer can get by trying constantly to solve the last decade's ethical problems with the prior generation's rhetoric. We must open our eyes to changes in the world lawyers and clients face and develop ways in which the profession can be responsive to the needs of each.32 That is the only way we can both be of service to those clients and avoid their developing ways to meet their legal needs without the help of at least the private practice segment of the profession.

To help bring the point home, think of yourself as a doctor 20 years or so ago. You had independence, you were doing well financially and cost control was an affront to your professionalism. The problem, of course, was that you were not in control of the world around you, and that meant you were not in control of your future or that of others following in your footsteps. You didn't pay attention to how you might have constructively headed off the wave of change that was to come, and despite your professional rhetoric, you were overwhelmed by it.

Lawyers' primary concerns should be values such as integrity, loyalty, competence and confidentiality. Those values have not and will not go out of date. A number of our ethical rules have less to do with those values than we like to think, however, and if our core values truly are to be protected, we may properly conclude that some current rules should be jettisoned. Those directing the Titanic did not heed the warning signs until it was too late. Let's hope the same will not be said of us. +

ENDNOTES
1. 371 U.S. 415 (1963)
2. Code of Virginia _54-78 (1950)
3. Perhaps the Court found it relevant that the Virginia statute had been passed in 1956, just two years after Brown v. Board of Education, 347 U.S. 483 (1954), had created the legal rights that the NAACP sought to enforce. However, the Court expressly said that it would have reached the same result if the older ABA Canons of Ethics had been the source of the prohibition. 371 U.S. at 429 n. 11.
4. 371 U.S. at 429
5. Id. at 439-43. It seems quite clear that the Court understood what it was doing. Indeed, a vigorous dissent by Justices Harlan, Clark and Stewart reminded the majority that it had invaded 'the domain of state regulatory power over the legal profession.' Id. at 448-65.
6. 377 U.S. 1 (1964).
7. 377 U.S. at 5-6. Thereafter, in United Mine Workers of America v. Illinois State Bar Ass'n, 389 U.S. 217 (1967), the Court gave constitutional protection to a Union's practice of employing a salaried lawyer to represent members wanting to prosecute worker's compensation claims before the state's Industrial Commission. United Transportation Union v. State Bar of Michigan, 401 U.S. 576 (1971), then said that the Constitution required a state to permit a union to recommend selected lawyers to pursue suits under the Federal Employers' Liability Act and to secure a commitment from those lawyers not to charge a fee in excess of 25 percent of the amount recovered.
8. 421 U.S. 773 (1975).
9. Virginia State Bar Committee on Legal Ethics, Opinion No. 170 (1971).
10. Justice Powell, long a member of the Virginia State Bar, did not participate in the decision.
11. Id. at 787.
12. Id. at 787-88. The Court closed: 'In holding that certain anticompetitive conduct by lawyers is within the reach of the Sherman Act we intend no diminution of the authority of the State to regulate its professions.' Id. at 793. However, that qualification has not reduced the significance of the decision. Just three years later, when an engineering association tried to rely on this language to justify its ethical restrain on competitive bidding, the Court quickly brushed aside the special character of professions. See National Society of Professional Engineers v. United States, 453 U.S. 679 (1978). See also Arizona v. Maricopa County Medical Society, 457 U.S. 332 (1982).
13. 433 U.S. 350 (1977).
14. Id. at 354.
15. Id. at 368-70. 'False, deceptive, or misleading' advertising may be regulated, and 'limited' disclaimers may be required as to lawyer's claims about themselves. However, 'truthful advertisement concerning the availability and terms of routine legal services,' is protected by the First Amendment. Other cases upholding First Amendment protection of most lawyer advertising include In re R.M.J., 455 U.S. 191 (1982); Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985); Shapero v. Kentucky Bar Ass'n, 486 U.S. 466 (1988); Peel v. Attorney Registration & Disciplinary Comm'n, 496 U.S. 91 (1990). But see Florida Bar v. Went For It, Inc., 515 U.S. 618 (1995) (upholding prohibition of targeted direct mail within 30 days of an accident or disaster). Bates and O'Steen had also challenged advertising restrictions under the Sherman Act. In this case, however, the Arizona Supreme Court had specifically imposed the bar to lawyer advertising in a court rule. Thus, under the rule of Parker v. Brown, 317 U.S. 341 (1943), federal antitrust law had to give way to the state regulation.
16. Additional Supreme Court cases consistent with this proposition include In re Griffiths, 413 U.S. 717 (1973) (requiring bar applicants to be U.S. citizens denies equal protection); Supreme Court of New Hampshire v. Piper, 470 U.S. 274 (1985) (requiring bar applicants to reside in state violates the privileges and immunities clause); Supreme Court of Virginia v. Friedman, 487 U.S. 59 (1988) (only allowing state residents to be admitted 'on motion,' i.e., without taking a bar exam, also violates the privileges and immunities clause). On the other hand, some lower court decisions have upheld a few of the old restrictive rules, e.g., Tolchin v. Supreme Court of New Jersey, 111 F.3d 1099 (3d Cir. 1997) (upholds requirement that licensed lawyer maintain an office in the state); Parnell v. Supreme Court of Appeals of West Virginia, 110 F.3d 1077 (4th Cir. 1997) (upholds rule requiring a local lawyer to 'sponsor' any applicant for pro hac vice admission).
17. The statement, attributed to the chairman of the board of IBM by a journalist in the 1970s, is quoted in Thomas D. Morgan and Ronald D. Rotunda, Problems and Materials on Professional Responsibility, 7th Edition, Foundation Press, 2000), 299.
18. Model Rule 1.8(a), of course, regulates lawyers' business dealings with a client. The issue of lawyers taking stock is the cover story in the current ABA Journal. See Debra Baker, 'Who Wants to Be a Millionaire,' 86 ABA Journal 36 (February 2000).
19. Conversation with Professor Peter Martin, one of the leaders of the effort to develop the Cornell website, in early 2000. 'Hits' are the number of data requests; the number of actual persons using the site would be less, but still a very impressive number.
20. The case was Unauthorized Practice of Law Committee v. Parsons Technology, Inc., 1999 WL 47235 (N.D. Tex. 1999), vacated and remanded, 179 F.3d 956 (5th Cir. 1999).
21. The case is discussed in Thomas D. Morgan and Ronald D. Rotunda, Problems and Materials on Professional Responsibility, 7th edition, (Foundation Press, 2000), 601-02.
22. Another reality in which lawyers now operate is the increased number of fellow lawyers chasing the same legal work. In the last 25 years, the number of lawyers has essentially tripled, from about 300,000 in the mid-1970s to about 1 million today. Fortunately, the demand for lawyers has also increased, although probably not proportionately. The first good economic study of the demand for lawyers was B. Peter Pashigian, 'The Market for Lawyers: The Determinants of the Demand for and Supply of Lawyers,' 20 J. Law & Economics 53 (1977). See also B. Peter Pashigian, 'The Number and Earnings of Lawyers: Some Recent Findings,' 1978 A.B.F. Res. J. 51 (1978); and 'Regulation, Preventive Law, and the Duties of Attorneys,' in William J. Carney, ed, The Changing Role of the Corporate Attorney (Lexington Books, 1982). I later tried to bring the work up to date and concluded that the nation now has roughly 15 percent more lawyers than the demand would justify. See Thomas D. Morgan, 'Economic Reality Facing 21st Century Lawyers,' 69 Washington L. Rev. 625 (1994). On the other hand, legally trained persons can often use their talents in ways other than practicing law and many seem to have done so.
23. The best known recent example of this was Bierbrower, Montalbano, Condon & Frank, P.C. v. Superior Court (ESQ Business Services, Inc.), 949 P.2d 1 (Cal. 1998), in which the California Supreme Court held that a New York law firm could not collect a fee for representing its client in an arbitration that took place in California.
24. ALI Restatement of the Law (Third): The Law Governing Lawyers _ 3 (2000) says that a lawyer may represent in any jurisdiction any client that has matters on which the lawyer works in at least one jurisdiction in which the lawyer is licensed to practice.
25. Its 'final' report was ABA Commission on Multidisciplinary Practice, Report to the House of Delegates, August 1999. The report met with a hostile reception in the ABA House of Delegates, and it seems likely that one or more future reports from the commission may be forthcoming.
26. See generally Milton C. Regan, Jr., Law Firms, Competition Penalties, and the Values of Professionalism, 13 Georgetown J. Legal Ethics 1 (1999).
27. E.g., Howard v. Babcock, 863 P.2d 150 (Cal. 1993); Shuttleworth, Ruloff & Giordano, P.C. v. Nutter, 493 S.E.2d 364 (Va. 1997). But see Cohen v. Lord, Day & Lord, 550 N.E.2d 410 (N.Y. 1989).
28. Thomas D. Morgan, 'Suing a Current Client,' 9 Georgetown J. Legal Ethics 1157 (1996).
29. Some latitude for such agreements is given in ALI Restatement of the Law (Third): The Law Governing Lawyers _ 122, Comment d, and ABA Formal Opinion 93-372 (1993).
30. See, e.g., Lee A. Pizzimenti, 'Screen Verite: Do Rules About Ethical Screens Reflect the Truth About Real-Life Law Firm Practice?' 52 U. Miami L. Rev. 305 (1997).
31. ALI Restatement of the Law (Third): The Law Governing Lawyers _ 124 provides one example of a rule that tries to avoid the sweeping character of the present prohibition.
32. The American Bar Foundation, with its unparalleled research capability and reputation for excellence, might be uniquely able to make a constructive contribution to this effort.

ABOUT THE AUTHOR

Thomas D. Morgan is the Oppenheim Professor of Law at George Washington University. He was the recipient of the W.M. Keck Foundation Award and Lectureship in Legal Ethics and Professional Responsibility, presented by the American Bar Foundation on Feb. 13, 2000. The award and lectureship were established to honor scholarly contributions in legal ethics and professional responsibility. The W.M. Keck Foundation was established in 1954 by the late William Myron Keck, founder of Superior Oil Co.

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