California Bar moves towards regulatory sandbox

The Board of Trustees of the State Bar of California took a 9-2 decision on the 14th May 2020 to form a working group to look into forming a regulatory sandbox in which innovative legal service providers would be subject to fewer regulations. This could include limiting unauthorised practice of law rules, as well as removing limits on fee sharing and partnership between lawyers and non-lawyers.

The decision is a major step forward in a potential move towards innovative business structures in California, following a vote to delay the decision by the Board in March, with board members saying they needed more time to consider the proposals.

Following the board meeting, which was held over Zoom, Chairman Alan Steinbrecher (who as Chairman did not vote) said: “This is a significant step and I think it will lead to an exciting future,”.

For more information see:

0

California Bar claims LegalMatch goes against attorney referral law

The State Bar of California attempted to sue LegalMatch on May the 4th 2020, for violating attorney referral laws. In November 2019 the California appeals court in Jackson v. LegalMatch found that LegalMatch, a service that matches clients with lawyers was a lawyer referral service (“LRS”) under California Business and Professions Code § 6155.

After the court’s decision, LegalMatch continued to operate, without formal registration, with the Bar claiming that LegalMatch ignored cease and desist orders, until the company had proper registration, and suggested that the company did not adequately make it clear that the service was not certified to operate in California on social media. This lead to the Bar attempting to file a temporary restraining order on the 4th May 2020.

However, during the course of the case, it became clear that LegalMatch had already submitted an application, which the Bar had not yet acted upon, leading Judge Ethan Schulman to deny the claim.

The case raises further questions about ongoing attorney referral rules both in the State and across the country, especially given the ongoing push for reform in California.

0

More regulatory responses to COVID-19

Following on from last month’s newsletter, we’ve put together the following list to examine different regulator responses to the COVID-19 pandemic. Here it is interesting to note the development and changes, as regulators begin to get a grasp on the crisis and develop innovative responses to meet the changing environment. If you have any questions or best practice for the rest of the ICLR community, please do get in touch, and we will be happy to include any of these in the next newsletter.

Illinois has introduced executive order 2020-14, this satisfies notarial requirements that a person must “appear before” a notary public if a two-way audio-video connection is used. It also allows documents to be witnessed through the same technology.


The Law Society of New South Wales has decided to run it’s annual Law Careers Fair as an online event, rather than cancelling it. The event will use zoom to create virtual presentations, with individual video booths and company landing pages replacing exhibitor booths. More information about the event is available here. The Society has also decided to reduce its $410 membership fee to $10, for the 2020-2021 period, allowing members to redirect funds to priority areas during the crisis.


The Law Society of Hong Kong has announced that civil hearing will take place remotely, with all other non-essential court hearings currently adjourned.


The Legal Sector Affinity Group which is made up of all the legal supervisory authorities in the UK, including the Law Society, Bar Council, CILEx, and the Law Society of Scotland, has released an advisory note on preventing money laundering during the crisis. The note discussed the increased risk of money laundering at the current time and what checks can be put in place to mitigate this.


The Council for Licensed Conveyancers in England and Wales is to allow members to defer fee payments, following the near-complete standstill in the UK property market. Members will be given the option to defer paying their practice fee and compensation fund contributions for April, May and June, which can be paid off over the following 4-12 months.


The California State Bar Board of Trustees has written to the California Supreme Court offering options and recommendations for the June First-Year Law Students’ Exam and the July Bar Exam. Full letter available here. Whilst the State Bar of Califonia has put in place emergency measures waiving late payment fees, as well as extending payment deadlines for membership fees and compliance deadlines.


The Law Society of Ontario has cancelled the lawyer licensing examinations and the call to the bar ceremonies due to take place in June. The society has said that alternative summer/autumn examination dates are being explored and that the administrative aspect of the call to the bar process is being undertaken remotely, allowing students to progress with their careers, with a celebration planned later in the year.


The Law Society of Saskatchewan and the Law Society of Alberta have temporarily reduced the articling requirements to a minimum of 8 months, instead of the previous minimum of 12 months, preventing a backlog of articling students due to limits created by coronavirus. Full statements available here and here. The Law Society of Alberta has also introduced changes allowing articling students to work remotely, as well as giving instructions on the supervision students doing this.


The American Bar Association has created a “Task Force on Legal Needs Arising Out of the 2020 Pandemic”, which launched a website on the 3rd of April to provide resources and information on the ongoing crisis and how this relates to the law. Statement available here, website available here. The ABA has also backed calls to adopt emergency rules that would allow recent and upcoming law school graduates who cannot take a bar exam because of the COVID-19 pandemic to engage in the limited practice of law, under the supervision of a licensed attorney, these individuals would have until the end of 2021 to practice without passing the bar exam. They hope this would limit the disruption to students careers, and help prevent the widening of the access to justice gap.  Full statement available here.

0

Legal Market Landscape Report (July 2018)

Commissioned by the State Bar of California, July 2018, Professor William D. Henderson

The Bar contracted with Professor William D. Henderson to conduct a landscape analysis of the current state of the legal services market, including new technologies and business models used in the delivery of legal services, with a special focus on enhancing access to justice.  The report is the first step in the
Bar’s study of delivery of legal services through the use of technology.

Read the report…

0

State Bar of California seeking public comments on regulatory reforms

The State Bar of California is seeking public comment on proposals for regulatory reform put forward by the Task Force on Access Through Innovation of Legal Services. The task force was set up to improve access to justice through regulatory reform, following a report in 2018 that suggested that regulation was limiting innovations which could improve the public availability of legal services (report available here). The task-force has unveiled sixteen concepts for regulatory reform, including allowing non-lawyers to hold financial interests in a  legal practice, and permitting fee-sharing between lawyers and non-lawyers. The Bar has now opened the options up to comment and they would appreciate the views of foreign regulators on their proposals.

The consultation closes on the 23rd September 2019. Full details of the consultation are available here.

0
post

California Bar Exploring Opportunities To Deploy AI

The agency is examining how artificial intelligence could help it review misconduct complaints and administer the bar exam.


The State Bar of California has started wading into the artificial intelligence waters.

The agency is exploring ways AI could help bolster the efficiency of its attorney discipline system and assist with administering the bar exam.

The bar recently entered into a contract with the MITRE Corporation to help it develop and evaluate algorithmic processes for identifying whether aattorney misconduct complaint could be closed without investigation.

State Bar Executive Director Leah T. Wilson said if an AI tool can be crafted to help the bar more speedily review whether to close or investigate complaints, it would reduce the administrative burden on staff. That in turn would allow the bar to shift its “human resources to other parts of the case processing continuum,” Wilson said.

Freeing up staff to assist with serious allegations of lawyer misconduct could be beneficial in light of the state auditor’s recent recommendation that the State Bar not hire as many new employees for its discipline unit as desired.

Wilson said an AI tool could also assist in ensuring a level of consistency and standardization in the bar’s review of the roughly 16,000 attorney misconduct complaints it receives annuallyThe technology could be especially helpful amid a nearly 60 percent increase in complaints made to the bar in recent months, a bump that has come amid the agency starting to accept online complaints.  

It was the transition last fall to permitting online complaints that allowed the bar to even contemplate an AI tool for reviewing such filings, according to Wilson.

She stressed that the MITRE project is in the early stages, and the bar will closely examine the effectiveness of the tool developed.

“If it’s not reliable to a very high degree of statistical significance, we couldn’t implement it,” Wilson said.

The bar’s $90,000 contract with MITRE, which was signed last month, calls for the company to complete its work on the project by mid-October.

Meanwhile, the State Bar is planning to use AI to help it administer the First-Year Law Students’ Examination, known as the “Baby Bar.” Law students completing their first year of law study at an unaccredited law school or through the Law Office Study Program are among those who must take the test.

At two of the sites where the Baby Bar will be given next month, the bar will be piloting the use of AI proctors for the essay portion of the exam that is taken on computers, Wilson said.

Live proctors will be there as well to ensure things go smoothly and to respond if the AI software alerts them to any patterns of eye movement or gestures out of the norm for test takers.

“If all goes well, it is our intention to deploy AI proctoring for the July bar exam,” Wilson said.

The bar began exploring AI proctoring because it struggled last year to attract enough proctors to administer the exams it gives to prospective lawyers.

Wilson said there will still need to be some human proctors present at future exams for security purposes and to help with any issues that arise, according to Wilson. But she said a successful pilot of AI proctoring would reduce the overall need for human proctors moving forward. 

On both the bar exam and attorney discipline fronts, Wilson said the bar is seeking to strike the right balance between being forward-leaning while protecting against the risks that arise with the deployment of new technologies.

I think it is the responsibility of good government everywhere to figure out how we can take advantage of technology to improve the services that we provide to the public,” she said.

Separate from the initiatives mentioned above, a bar task force is actively working to identify regulatory changes that would provide members of the public with greater access to legal services through technology, such as AI. The next meeting of the Task Force on Access Through Innovation of Legal Services is Monday, May 13.


*This article first appeared on Evolve the Law. 

0
post

California continues to debate division of regulation and representation functions

The California State Bar has been investigating the potential division of regulation and representation functions over the past five years. The Governance in the Public Interest Task Force concluded in 2017, launching a five-year strategic plan to “successfully transition to the ‘new State Bar’ — an agency focused exclusively on public protection through regulating the legal profession and promoting access to justice”.

Under the new system, the California State Bar will be a purely regulatory body. All representative functions will be transferred from the Bar to the  California Lawyers Association, a new professional entity.

Proponents and critics of the new system alike question how this new transition will impact the already uncertain financial footing of the Bar. However, the new strategy will strive to “Improve the fiscal and operational management of the State Bar, emphasizing integrity, transparency, accountability, and excellence.”

Read California’s new Five Year Strategy 

0

California prepares to lead US profession into non-lawyer ownership

Regulators are poised to consider radical rule changes that could decisively open the way to allowing non-lawyers into the legal profession of the US’s most populous state.

The State Bar of California voted earlier this month to accept a report from legal academic Professor William D. Henderson calling for structural reforms to the way the market is regulated. The bar’s board of trustees further resolved to authorise a taskforce to study and come back with recommendations for reforms that balance the goals of public protection and increased access to justice.

The taskforce proposals – not expected until 2019 – could pave the way for a version of the alternative business structure regime in the UK and Australia, allowing a system where non-lawyers are able to own law firms and legal businesses are able to take on external capital investment. Despite repeated attempts to encourage liberalisation in the US – and not withstanding sporadic examples of legal markets opening to outsiders – the US profession has overwhelmingly resisted emulating England and Wales.

In his report, Prof Henderson cited the problem of ‘lagging legal productivity’ and that, in contrast to medical care and higher education, a growing proportion of US consumers are choosing to forgo legal services rather than pay a higher price.

Read the Full Article 

Henderson Report

 

0

State Bar of California publishes 2017 Annual Discipline Report

In 2017 the State Bar and its prosecutorial arm, the Office of Chief Trial Counsel, implemented a number of comprehensive structural and process re-engineering reforms designed to improve public protection for all California residents. Given the ambitious nature of these reforms, key measures from the report indicate a decline in short-term performance as compared to the previous year.

Key 2017 workload measures include:

  • Received 15,175 new complaints of attorney misconduct; of these 524 were immigration related;
  • Received 668 unauthorized practice of law complaints, 158 of which were immigration related;
  • Referred 315 unauthorized practice of law matters to law enforcement for potential prosecution;
  • Closed 14,063 cases and filed formal charges in 483;
  • Recommended disbarment or suspension to the Supreme Court in 592 cases;
  • Disbarred 129 attorneys; suspended 134 attorneys; and reprimanded 52 attorneys.

An additional performance measure included in the Annual Discipline Report is case backlog, which grew in 2017. The report notes that while the current backlog is up, the Office of Chief Trial Counsel has been developing a new system of case prioritisation to provide more protection to vulnerable victims of attorney misconduct, which will ultimately ensure that the cases that cause the most harm to the public never end up in backlog status.

“Californians deserve to be protected by a strong attorney discipline system. Our internal reforms and improvements will help the State Bar better achieve our mission of protecting the public from attorney misconduct,” said Leah Wilson, Executive Director of the State Bar of California.

Major initiatives of the State Bar Office of Chief Trial Counsel in 2017 include:

  • Development of an improved case prioritisation system to devote more resources to the cases which pose the greatest threat to the public;
  • Implementation of a new Case Management System to increase transparency, effectiveness, and efficiency;
  • Assessment of workload to allocate heavy caseloads among staff fairly and efficiently.

The State Bar’s ongoing reform efforts included additional measures  taken in 2017 to support the attorney discipline system and public protection:

Read the full 2017 Annual Discipline Report.

 

0

California probation materials

These materials were presented at the 2016 International Conference of Legal Regulators.

Session title: I always feel like somebody’s watching me: reinstatement and supervision of lawyers on probation

This paper includes the standard conditions and a compliance declaration.

California probation materials

0