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Lawyers With Out-of-State Practices Can Run Afoul of UPL Rules

Submitted by Amaris Elliott-Engel on Tue, 11/17/2015 - 07:53

I wrote a piece for the Connecticut Law Tribune about how telecommuting and taking conference calls from home can make lawyers run afoul of the unauthorized practice of law rules:

There are probably hundreds of lawyers who are licensed in New York and living in Fairfield County in Connecticut. It's become commonplace for these attorneys to log onto their home computers to work on legal documents on behalf of New York clients, to participate in late-night video­conferences from home, or to conduct other business as their commuter train rolls through Norwalk.

But now some lawyers are quietly voicing concerns that under Connecticut Practice Book rules they may be engaged in the unauthorized practice of law (UPL) if they live in Connecticut but are licensed exclusively in New York. One attorney recently told the Law Tribune he made sure to get sworn into the Connecticut bar because he has a home office in Greenwich out of which he serves New York clients.

So are lawyers with virtual offices in Greenwich violating Connecticut's Rules of Professional Conduct? How about someone who regularly telecommutes from a Stamford apartment and takes Metro-North to a Manhattan law firm only once a week? Does the definition of practice of law in Connecticut conflict with the modern realities of lawyering through videoconferencing and email?

"The Rules of Professional Conduct are lagging behind [technology]," said Dove A.E. Burns, a partner at Goldberg Segalla whose professional liability defense practice includes lawyers as clients.

Under Connecticut rules, "the practice of law is ministering to the legal needs of another person and applying legal principles and judgment to the circumstances and objectives of that person." Leslie Levin, a University of Connecticut School of Law professor who studies the legal profession and lawyer discipline, acknowledges that Connecticut does have a "very wide definition of what constitutes the practice of law," meaning that many work-related tasks a New York lawyer might perform from a Connecticut residence could be construed as practicing law.

Levin said that read in a commonsense way, the rule governing UPL, Rule 5.5, is addressing legal advice offered to Connecticut residents. But if it's taken literally, according to attorneys with expertise on ethics issues, many lawyers may be violating the rule. The good news, it would seem, is that disciplinary officials probably will not coming after them anytime soon.

There's no doubt attorneys can run afoul of the disciplinary rules if they are regularly giving advice to clients in a state in which they don't have a true presence, even if as a practical matter they only live a few miles across the border, said Burns. She pointed out that the Delaware Supreme Court recently suspended an attorney from practicing law for two years because he worked out of his home in Pennsylvania. His Delaware presence was a commercial space where his landlord's receptionist did little more than greet visitors and collect the attorney's mail.

Connecticut's UPL rule clearly bars attorneys from making false claims about their licensing status. You "can't hang up a shingle in Connecticut and hold yourself out as authorized to practice law in Connecticut," said Marcy Tench Stovall of Pullman & Comley, who represents attorneys in malpractice litigation and disciplinary matters.

From there, however, the matter becomes more nuanced, raising "philosophical questions," said Stovall, that lead lawyers to parse the meaning of words such as "continuous" and "temporary."

Consider this: In Connecticut, an attorney, even while just giving advice to clients in New York under his New York license, could violate Rule 5.5(b) of the Rules of Professional Conduct, Stovall said. Rule 5.5(b)(1) bans lawyers licensed in other states from establishing a "systematic and continuous presence" in Connecticut in order to practice law.

However, there is a "safe harbor" rule for attorneys licensed in New York or other jurisdictions and who are practicing law in Connecticut only a "temporary" basis. The safe harbor applies, according to the rule, if the lawyer is providing services that arise "out of or are substantially related to the legal services provided to an existing client of the lawyer's practice or in a jurisdiction in which the lawyer is admitted to practice."

But a Connecticut-dwelling attorney doing work for non-Connecticut clients technically could be breaking the rule if they regularly work at home or on their commute through Fairfield County on the way to New York.

"If you read the rule literally, you wouldn't be practicing law on a temporary basis and [thus] not entitled to the safe harbor," Stovall said. She added that, given the ease of long-distance communications in the Information Age, it would be an "absurd result" if a lawyer was disciplined for sitting in a Connecticut home and offering counsel to a New York client. That is a "reflection of how the rules can't keep up with how people practice," she said.

Mark Dubois, who was Connecticut's first chief disciplinary counsel and is now counsel at Geraghty & Bonnano in New London, noted that the Rules of Professional Conduct are based on a 19th-century world in which lawyers were representing clients in the same town. In that era, he said, attorneys from Hartford would never even be representing clients from New Haven, much less New York.

Dubois said many bar regulators judge UPL matters simply by applying the "where-is-your-butt" test. In other words, UPL is determined if an attorney is physically located in a place where he or she is not licensed to practice.

But Dubois said a small number of states have given regulators more flexibility to make judgment calls. Among them is Arizona, he said, where a regulator might try to distinguish between attorneys giving advice about Arizona law when they're not licensed in Arizona, and attorneys who happen to be temporarily staying in a Tucson hotel room who log into their New London computers and give advice to Connecticut clients.

Moving forward, he said, questions for regulators investigating possible UPL violations will include: "Where are you when you're doing [legal work]? Are you where the client is? Where is the predominant effect of your conduct felt? Is it where you are physically?"

While an attorney could be violating UPL rules while doing legal work on a business trip, regulators are unlikely to spend the effort to discipline them, Dubois said. He said they are more concerned about protecting consumers from attorneys who don't know what they're doing and from having their money stolen by dishonest lawyers.

Burns, who commutes from her home in Wilton to a Goldberg Segalla office in midtown Manhattan, agrees that attorneys who rely on technology to do business away from their formal law office have more pressing challenges than aggressive disciplinary officials.

If faced with a professional malpractice lawsuit, she said, lawyers run the risk that they could be violating their insurance policy's "standard of care" clause because they are giving advice about the laws of a state that they don't often work in. A malpractice insurance provider isn't going to like it if an attorney isn't keeping up with the practice of law in the state where she is licensed because she often practices from a remote locations, Burns said.

Then there's the whole matter of cybersecurity. A data breach of confidential information caused by accessing files from an out-of-office location poses a significant liability concern. Lawyers, said Burns, are responsible for maintaining client confidentially "regardless of the pitfalls and failings of technology." 

Ban on 'Telemedicine' Abortions Struck Down By Appellate Court

Last week, the Iowa Supreme Court struck down that state's ban on doctors prescribing abortion-inducing pills to patients via video teleconferencing, the Associated Press reports. Iowa was the first state to allow doctors to dispense abortion-inducing medications through telemedicine.

The court ruled that it placed an undue burden on a woman's right to get an abortion. The Iowa Board of Medicine enacted a rule requiring a doctor be physically present with a patient before prescribing such drugs. However, the board had allowed telemedicine for other procedures.

What Laws Are Needed for the Internet of Things?

Jeff John Roberts, writing in GigaOM, writes about how we don't have rules yet to govern the Internet connections that have been brought to physical devices--the so-called "internet of things": "The first murder through the internet of things will likely take place in 2014, police service Europol warned this month. The crime could be carried out by a pacemaker, an insulin dosage device, a hacked brake pedal or myriad others objects that control life-and-death functions and are now connected to the internet." He notes that there are completely open questions on whether manufacturers of Internet-connected devices are going to face liability for privacy breaches: "In the future, judges may start asking if the concept of 'privacy by design' should become a safety standard, and even require internet companies to adopt the same pre-cautions as auto makers or playground designers."

The Law and Technology Both Should Protect Privacy

Marshall Erwin, writing in Just Security this week, makes the case that technology should thwart government access to user data just as it has been facilitating government surveillance until Apple and Google decided to start encrypting user data when devices are locked. "The arguments made by critics of Apple and Google assert that these changes will result in damage to the public interest by protecting criminals and those who want to do us harm. More importantly, they suggest that warrant protections are necessary and sufficient to safeguard the public interest and to adjudicate the circumstances under which the government may access data," Erwin writes. He says it's wrong to suggest that only legal mechanisms, not technical mechanisms, should restrict government access to user data.

Law Professor Says Computer Model Predicts #SCOTUS Decisions with 70% Accuracy

Law professor Josh Blackman, who developed a Supreme Court fantasy league, says colleagues and he have developed a computer model that can predict decisions of the U.S. Supreme Court with 70 percent accuracy, ABA Journal reports. The ninety variables included the party of the appointing president, a justice's ideological predilections and "the agreement level of the court." Blackman said the model could be used by lawyers deciding whether to settle cases or not.

Apples Comes to Electronic Health Records

Apple's partnership with Epic Systems, the dominant vendor of electronic health records, on a HealthKit platform for health apps and tracking devices will initially store around 60 different types of health data, Forbes contributor Zina Moukheiber writes. A conusmer using HealthKit has to give Apple permission to share biometrics with Epic's electronic health record system for patients, MyChart, in order to notify their clinicians.

This partnership could be a key step in making electronic health records more portable and interoperable between different healthcare providers. There also will be privacy concerns that Apple will have to engage with as it moves into the health information technology sector.

Electronic Health Records Costing Patients Direct Physician Care

Electronic health records are being adopted by health care providers at an increasing pace, including due to incentives from the federal government. But "modern EHRs are often overly focused on data entry and typically provide poorly designed data displays with rudimentary functions for searching and organizing patient data. The data entry steals physician time away from direct patient care," Forbes reports. The Government Accountability Office has said the incentive program for EHRs doesn't have the ability to demonstrate that patient care is improved by EHRs, Forbes also reports.

Reshaping Copyright Law's Contours Isn't Aereo's Only Problem. There's the Electric Bill Too.

The unseen part of the digital economy is how much power it takes for Google and Amazon and Facebook and Netflix to be available to us all the time, whenever we want. Aereo, one of the streaming services retransmitting broadcast TV over the Internet, also faces a huge electrical bill. The Wall Street Journal estimates that 90,000-135,000 subscribers in New York City could cost Aereo $2 million a year. The Journal further reports: "Power is 'one of the biggest challenges' the company faces, [CEO Chet] Kanojia said, adding that one option he is considering is getting off the grid and generating power using fuel cells."

Broadcasters are challenging Aereo's streaming service in the U.S. Supreme Court, arguing it is infringing their copyrights in their programming.

Stopping Link Rot in Law and Science

Here's a more in-depth look at the site that "is creating etched-in-stone digital references for scholars and lawyers," GigaOm posted.

The site would solve the issue of broken links to the sources in scholarship by taking readers "to the site where they are presented with a page that has links both to the original web source (along with some information, including the date of the link’s creation) and to the archived version stored by," GigaOm also reports.

As GigaOm also noted, "link rot is a growing issue for both courts and academic journals, but one that is downplayed on the grounds that books and paper are the 'real' authorities while internet sources are ephemeral or, at best, unofficial. As the era of print recedes, however, this anti-digital bias looks more and more untenable."

My prior post on the findings that 50 percent of links in U.S. Supreme Court cases and 70 percent of links in some Harvard law journals are broken:

Why the Federal Insurance Exchange Is Failing

The New York Times reports on why the health-insurance exchanges have been so buggy: one factor was that the biggest contractor wasn't given specifications right away and only started writing software code this spring. Another factor was not rolling out a piece of the portal instead of the whole shebang at once. A third factor was that the Centers for Medicare and Medicaid Services "assumed the role of project quarterback, responsible for making sure each separately designed database and piece of software worked with the others, instead of assigning that task to a lead contractor." Sources told the NYT that CMS did not have the capacity to take on that role.

The result: "Many users of the federal exchange were stuck at square one. A New York Times researcher, for instance, managed to register at 6 a.m. on Oct. 1. But despite more than 40 attempts over the next 11 days, she was never able to log in. Her last attempts led her to a blank screen."


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