by Kevin Crews
In the early 1800s, textile artisans protested against the proliferation of new technology — specifically, mechanized looms.1 Despite their protests, the new technology came and workers had to retool, adapt, and embrace the invention. Similarly, over the last several years, lawyers have had to continuously adapt to new technology. The virtual law office is one advance that lawyers can capitalize on by meeting modern marketplace demands for unbundled legal services.
Operating a virtual law office evokes images of practicing law from the beach, or from the top of a mountain, or from a yacht off the Italian coast. And these activities might be some of the perks of a virtual law firm. However, specific malpractice risks and increased ease of violating the rules of professional responsibility accompany those benefits. Each law firm that uses technology to connect with clients must embrace and thoroughly utilize the technology. Although technology can create problems, the proper use of that same technology can mitigate those problems.
Understanding a Virtual Law Practice: Using Technology to Communicate
In general, a virtual office is one involving a “computer-simulated environment, accessible by multiple users via the Internet.”2 That definition covers any virtual office. Translated to the legal context, it logically follows that a virtual law practice is one that relies on technology-assisted communication to provide legal services.
In a 2013 American Bar Association survey, around 5 percent of all lawyers — and 7 percent of solo practitioners — stated that they operate a purely virtual law practice.3 Although the number has declined slightly since 2012,4 that study refers to a pure virtual law practice. Many more lawyers likely practice in a quasi-virtual environment, using varying degrees of technology to facilitate communication. Thus, both the pure-virtualists and the quasi-virtualists can benefit from understanding how technology can help.
Many authors describe a virtual law office as one where the client can “have access to the firm’s lawyers, communications and documents related to their legal issues through a password protected and secure web space.”5 The virtual law firm allows lawyers to share information with clients in an asynchronous manner, meaning that the lawyer and the client do not have to be together at the same time to convey information. The technology facilitates communication, even when the lawyer does not physically meet with the client.
Any service in which clients log in to view information functions as a virtual office. Simple Google searches for “virtual office software” or “client portal software” show samplings of the numerous software vendors that offer solutions, many of which are cloud-based. Taking a virtual law office to its most extreme, some lawyers use a software program called Second Life6 to create a virtual law office using a video game-like interface. On Second Life, “a virtual office is essentially a three-dimensional space in the virtual world that replicates a real-world office…[including] a virtual conference table, a seating area, [and] a bookshelf stocked with virtual federal reporters.”7 In this virtual world, clients and lawyers interact using avatars. And these virtual spaces lead to real world gains: One attorney opened a law office on Second Life, allowing him to acquire “some real-world clients, billing approximately $20,000 in legal fees as a result.”8
Benefits to the Client — Unbundled Legal Services
The last few years have seen “shrinking demand by paying clients for expensive legal services.” Developments in technology, however, have created opportunities for “efficient software and low-cost delivery of legal services.”9 In fact, the majority of online legal services today come as unbundled legal services, in which clients select various lawyers for different tasks or transactions.10
To meet this marketplace demand, a virtual law office can help lawyers provide these legal services. By using technology to facilitate communication, clients can more easily obtain legal advice, one piece at a time. This method of delivering client services supports the marketplace demand to pick and choose legal services at affordable rates.11
Benefits to the Lawyer
Lawyers benefit from providing virtual services. Having a virtual law office improves quality of life for many. For example, many practitioners may aspire to emulate a lawyer from Texas, who used technology to create a virtual law office, allowing him to travel and work on his next novel.12
However, the primary benefit from a virtual law office is that it integrates with a traditional law office, expanding the firm’s client base. A virtual law office then functions as “another door to your traditional brick-and-mortar law office.”13 The virtual law office allows a firm to compete for the business of clients who live elsewhere, while also allowing increased flexibility for existing clients.14 And many observers expect clients to continue to develop a taste for virtual services,15 meaning that lawyers should supply these virtual services to meet the demand.
Also, the virtual office offers internal efficiencies. Within the virtual office, lawyers and clients can “securely discuss matters online, download and upload documents for review, prepare for trial, calendar tasks and deadlines, create legal documents, and handle other transactions,” as well as send invoices.16 The firm’s staff also can use the virtual law office to communicate securely about the client’s matter.17 Thus, having a virtual law office leads to internal and external efficiencies because a single platform unites lawyer, staff, and client.
Malpractice Risks and How to Avoid Them
Despite the benefits of a virtual law office, using technology creates additional ways to commit malpractice and violate ethical obligations.18 The first step to confronting these modern risks is to know about them. By learning, lawyers will satisfy obligations under Florida Rule of Ethics 4-1.1 because, in a technology driven world, lawyers must properly utilize technology to provide competent representation. While there are numerous risks, these risks can generally be categorized into the following three concerns.
Risk #1: Unauthorized Practice of Law
One of the most serious risks of a virtual law office is that the technology makes it extremely easy to cross a jurisdictional boundary — knowingly or unknowingly.19 In some respects, this risk is a modern manifestation of an old problem. For example, as The Florida Bar noted in 1977, a Florida attorney “may not properly use on the same letterhead the address of an Ohio firm in which he is presently listed as ‘Of Counsel.’”20 In that instance, the Florida attorney did not have any physical connections to the Ohio office, thus, the attorney could not use the Ohio address because doing so could mislead the public to think that he had more connections to Ohio than he actually did.21 Thus, lawyers have always had to be mindful of the states in which they practice and how they market themselves in those states.
Just as when picking addresses to use on letterhead, virtual attorneys must be mindful of where and how they market themselves and deliver services. In the virtual world, it simply is much easier to cross jurisdictional lines because clients could come from anywhere. Attorneys must be mindful of where their clients reside and where they are marketing and delivering services. Otherwise, the virtual law office makes it very easy to commit malpractice by delivering legal advice somewhere the attorney is not licensed.
Similarly, lawyers must be mindful of any bona fide office requirements. Some states, such as New Jersey, may prohibit virtual practitioners who do not maintain a physical office within the state.22 Thus, lawyers should not exclusively use a virtual law office in these types of jurisdictions.
Mitigate Risk #1: Communicate and Define the Attorney-client Relationship
Strong communication is the best way for attorneys to prevent practicing law in jurisdictions in which they are not licensed. Technology, including firm management software, can help lessen malpractice risks. Virtual lawyers may use online agreements or “clickwrap agreements,” in which customers must click “accept” to some terms of service before accessing a website, to define the scope of the relationship for virtual clients.23 Alternatively, lawyers can post this information prominently on their website. By providing this information, lawyers will require customers to acknowledge that they are accessing a virtual service and can explain that the service may have limits.24 By doing so, the virtual lawyers will be able to communicate where they are licensed and have prospective clients agree that they are within those areas.
Additionally, to avoid misleading the public, attorneys should disclose that they operate a virtual law office. For example, a virtual law office that has a temporary physical office space for meetings should state the physical address and indicate that it is “by appointment only.”25 This action is a best practice that could help prevent any future problems.
Law firms can use these disclaimers to the lawyer’s advantage as a marketing tool. They can also explain the benefits of using a virtual law firm.26 At a minimum, these communications and disclosures will prevent problems so that attorney and client are aligned from the very beginning. In states with bans on virtual law offices without a physical component, lawyers can capitalize on the benefits of a virtual law office, but must simply add virtual services to their brick-and-mortar law office services.
Risk #2 — Authenticity: Ease of Mistake and Fraud
E-signature issues illustrate some of the risks lawyers must confront regarding authenticity. Signing a name electronically — such as “/s/ John Smith”— can create issues. For example, in a California case from 2012, a lawyer’s secretary opened a Ch. 7 bankruptcy case for a friend, using the attorney’s e-signature without the attorney’s knowledge. The attorney was very busy “with his legal practice and ‘outside business,’” and did not supervise the employee closely.27 The attorney learned about the new case later, after he missed a meeting about it, and agreed to continue the representation, even though it began fraudulently.28
The court disciplined the attorney, imposing a $2,000 sanction and awarding attorneys’ fees to the other side, finding that the attorney “failed to protect and prevent the unauthorized access and use of his…document filing privileges.”29 Also, the court disciplined the attorney for developing “a culture…where nonattorneys are providing legal services to purported ‘clients’ without any supervision.”30 In sum, the culture of the law office aided the nonlawyer in engaging in the unauthorized practice of law.31
This type of fraud could happen to any lawyer, but the virtual lawyer is susceptible to increased risk, particularly if employing assistants. When lawyers are busy, it is possible that something could slip by through a mistake or wrongdoing. When all business is done virtually, it is easier for a problem to occur because there are no physical checks and balances.
Mitigate Risk #2: Use Practice Management Software
The large professional services firm of KPMG suggests the way to reduce the risk of fraud is to 1) assess risk, 2) design programs to prevent it, 3) implement the strategy, and 4) evaluate.32 Translated to virtual or quasi-virtual law firms, to help mitigate the risk of mistake or fraud, lawyers should use an online practice management tool.
Efficiently staying organized and informed about every case is the best way to prevent something from slipping past — by mistake, error, or fraud. Cloud-based practice management software can help lawyers keep up with the demands of the practice and stay organized. The proper use of practice management software would help prevent the problems noted in the above California case because the lawyer would be more organized and able to supervise the business. Thus, it would be less likely for something unfortunate to happen.
Risk #3: Confidentiality and Data Breaches
It is very easy to lose important information in a digital world. The risks range from “lost or stolen laptops or mobile devices, to dishonest, disgruntled, or untrained insiders, to sophisticated hacking attacks.”33 Even email runs the risk of being intercepted.34 In a virtual law office, the core of the business depends on virtual data. If anything compromises data security, lawyers face a potentially serious malpractice liability because the lawyer has not secured the client’s virtual property and has exposed the client to data or identity theft.
Mitigate Risk #3: Practice Safe Computing
Lawyers must stay educated about security threats when providing virtual services and learn how to mitigate the risks. A few tips include the following: Use a firewall, use antivirus software, use a safe Internet browser with pop-up blocker, avoid free wi-fi hotspots, backup computers daily, use a server that will allow the wiping of data on lost or stolen devices, never write down username or passwords, read blogs or articles on these issues as a form of recurring education.35 Defending your practice from computer risks is a constantly evolving process, so lawyers should follow a source that will keep them up to date on ways to mitigate the latest risks. For example, the University of Florida has an information security page that provides the latest tips to protect from “malicious Internet activity.”36 Whatever source of information lawyers choose to use, staying up to date with technology is a job requirement for modern lawyers.
There are numerous risks associated with a virtual law office, but rather than shying away from technology, lawyers must thoroughly embrace and understand the technology they use. And having a positive mindset is key. When adapting to new technology, psychologists agree that “if you believe that you can or can’t do something, you likely will be right either way.’”37 Thus, the best practice for lawyers is to embrace the technology, be mindful of the risks, and thoughtfully pioneer the way ahead.
1 Coming to an Office Near You: The Effect of Today’s Technology on Tomorrow’s Jobs Will be Immense — and No Country Is Ready for It, The Economist 6 (Jan 18, 2014).
2 Jeffrey I. Silverberg, Hanging Out Your Virtual Shingle: A Look at How South Carolina’s Ethics Rules Concerning Attorney Communications, Advertising, and Solicitation Apply to Virtual Worlds, 62 S.C. L. Rev. 715, 716 (2011).
3 Debra Cassens Weiss, Fewer Virtual Law Practices and Telecommuting Lawyers Reported in ABA Survey, ABA J. (Aug. 15, 2013).
5 Richard S. Granat & Stephanie Kimbro, The Teaching of Law Practice Management and Technology in Law Schools: A New Paradigm, 88 Chi.-Kent L. Rev. 757, 770 (2013).
6 Second Life, http://secondlife.com.
7 Jeffrey I. Silverberg, Hanging Out Your Virtual Shingle: A Look at How South Carolina’s Ethics Rules Concerning Attorney Communications, Advertising, and Solicitation Apply to Virtual Worlds, 62 S.C. L. Rev. 715, 721 (2011).
8 Id. at 722.
9 Jon M. Garon, Legal Education in Disruption: The Headwinds and Tailwinds of Technology, 45 Conn. L. Rev. 1165, 1232 (2013).
10 Stephanie L. Kimbro, The Law Office of the Near Future Practical and Ethical Considerations for Virtual Practice, N.Y. St. B. J. at 28, 29 (Sept. 2011).
11 See generally Luz Herrera, Reinventing the Practice of Law: Emerging Models to Enhance Affordable Legal Services (2014).
12 Larry D. Thompson, 2012 WL 5422215 (court filed expert resume).
13 JoAnn Hathaway & Diane Ebersole, Law Practice Solutions: Best Practice Tips for the Virtual Law Office, 89 MI B. J. 58 (2010).
14 See generally Stephanie Kimbro, Virtual Law Practice: How to Deliver Legal Services Online (2010).
16 JoAnn Hathaway & Diane Ebersole, Law Practice Solutions: Best Practice Tips for the Virtual Law Office, 89 MI B. J. 58 (2010).
18 Stephanie L. Kimbro, The Law Office of the Near Future Practical and Ethical Considerations for Virtual Practice, N.Y. St. B. J. at 28, 29 (Sept. 2011).
19 Jeffrey M. Aresty & Peter D. Lepsch, E-commerce and the Impact of Globalization on the Law: Panel Remarks: Professional Responsibility in a Global World: A Lawyer’s Role Redefined in the Age of the Virtual Practice, 8 New Eng. Int’l & Comp. L. Ann. 37, 54 (2002).
20 Fla. Bar Ethics Opinion 76-34 (May 3, 1977).
22 Jordana Hausman, Who’s Afraid of the Virtual Lawyers? The Role of Legal Ethics in the Growth and Regulation of Virtual Law Offices, 25 Geo. J. Legal Ethics 575, 579 (2012).
23 Stephanie L. Kimbro, The Law Office of the Near Future Practical and Ethical Considerations for Virtual Practice, N.Y. St. B. J. at 28, 31 (Sept. 2011) (“[A] purely virtual law office without a brick-and-mortar component should include this [s]tatement [of client’s rights] on its main website as well as within the secure client portal area.”).
24 Stephanie L. Kimbro, Practicing Law Without an Office Address: How the Bona Fide Office Requirement Affects Virtual Law Practice, 36 Dayton L. Rev. 1, 16-17 (2010).
27 In re Black, 11-18491-B-7, 2012 WL 8255518 (Bankr. E.D. Cal. July 30, 2012).
32 KPMG Forensic, Fraud Risk Management: Developing a Strategy for Prevention, Detection, and Response (2006), https://www.kpmg.com/CN/en/IssuesAndInsights/ArticlesPublications/documents/Fraud-Risk-Management-O-200610.pdf.
33 Andrew Askew, iEthics: How Cloud Computing has Impacted the Rules of Professional Conduct, 88 N. Dak. L. Rev. 453, 465 (2012).
34 Stephanie L. Kimbro, Regulatory Barriers to the Growth of Multijurisdictional Virtual Law Firms and Potential First Steps to Their Removal, 13 N.C. J. L. & Tech. On. 165, 203 (2012) (noting that “while many states allow for the use of email communication with clients, any form of unencrypted email runs the risk of access by a third-party”).
35 See Stephanie Kimbro, Best Practice Tips for the Virtual Law Office, Mich. B. J. at 58, 59 (Sept. 2010) (explaining these tips in more detail).
36 University of Florida Information Technology, Protect Yourself, https://security.ufl.edu/learn-information-security/protect-yourself/.
37 Jeff Strickler, Don’t Face Extinction at Work; Stay Tech Savvy, Tampa Bay Times, Jan. 26, 2014, at 3D (quoting Verna Monson, an educational psychologist).
Kevin Crews is the winner of the 2014 Law Student Essay Contest sponsored by Florida Lawyers Mutual Insurance Company, the Young Lawyers Division of The Florida Bar, the General Practice, Solo and Small Firm Section of The Florida Bar, and The Henry Latimer Center for Professionalism. The essay contest, which is in its fourth year, was created to raise law students’ awareness of practice risks surrounding current issues of concern to the legal profession and best practices to manage identified risks.
Crews is a two-time winner of the writing contest, and is a third-year law student at Stetson University College of Law.
This column is submitted on behalf of the Young Lawyers Division, Melanie S. Griffin, president.