The Business of Law Will Get Its Day in Court
But that doesn't mean that the good folks at J&M don't want to be on the cutting edge again, this time bringing non-lawyer money into their storefronts. Via Bloomberg:
Jacoby & Meyers LLP, the discount law firm with storefront offices across the U.S., won an appeals court ruling reinstating its legal attack on a New York statute barring nonlawyers from owning an interest in law firms.
Jacoby & Meyers, which wants capital to expand into communities with working-class and immigrant families, has asked federal courts in New Jersey and Connecticut as well as New York to throw out such laws. A judge last year dismissed the New York case citing jurisdictional grounds.
The U.S. Court of Appeals in New York today issued an order modifying a November ruling that reinstated the suit and returned it to the trial court.
Despite overly simplistic assumptions that anyone who doesn't embrace every new money-making scheme for lawyers is either a Luddite or hater, there are some ideas worthy of pursuit and some not. For example, I like the idea of lawyers having a kiosk in Wal-Mart, much as doctors have doc-in-a-box acute care facilities. Bring the law to the people, eliminating unnecessary expense so that lawyers can earn a living while clients are provided quality counsel at a reduced cost? Great idea.
What about non-lawyers owning law firms?
They want a cash infusion to expand, and want to go to the capital markets for the money rather than borrow it. Maybe no one will lend it to them. Maybe they would prefer not to pay back the debt, but use profit participation. Fair enough.
The Brits already allow it, as do the Aussies. Of course, they do plenty of things differently than we do.
On the other hand, the concern is that non-lawyer investors will compel choices that are inconsistent with the ethical responsibilities of lawyers. The law doesn't fit well with typical cost-benefit analyses, often requiring us to do things to serve our clients which are contrary to our own financial self-interest. It's not that we don't like profit. We like profit. We just don't put profit ahead of obligations.
The Second Circuit decision remitting the case to Judge Lewis Kaplan clearly anticipates a ruling on the merits, which is good. It's time to put this issue to rest, so we can either move forward with investment or put the dreams of law firm IPOs to rest. The perpetual schemes of futurists for a reimagined profession are confusing a great many new lawyers as to where they should focus their energies and how they should plan their futures. At some point, the cries for a paradigm shift have to either happen or stop.
Ironically, Jacoby & Meyers was at the forefront of lawyer advertising all those years ago. Most young lawyers can't imagine a world without lawyer advertising, whether the cheesy television commercials or their websites promoting how they're aggressive, caring and offer free consultations.
Here's where I say something that is going to make you call me mean names. Lawyer advertising has been the worst thing to happen to the profession.
Yes, I'm well aware of all the arguments, First Amendment and level the playing field, and all that stuff, in favor. What I'm also aware of is that it started the race to the bottom, with unintended consequences wherever one turns.
Has it worked for you? Has it made legal representation more available and affordable to the public? Has it made lawyers wealthier and happier? Well, maybe the few who jumped in early, but it came at the expense of others and bore no relation to the value of legal services or the quality of representation.
But who cares about such crap? It's all about making money, right, and if it makes you money, then it has to be good. It just has to.
There is a segment of the profession who argues that law is a business, and I suspect they are right as far as they are concerned. For others, there is a business component to the practice of law, certainly, but it is not a business in the same way as non-professions. That the perception has changed isn't a reflection of the future, but a misperception of the present. They see law as a business because they can't comprehend what it means for law to be a profession. They see ethics and competence as the archaic weapons of old men to keep them down, to make them poor, to maintain their hegemony over the machine that cranks out money.
To the extent lawyers have adopted this belief, the step of non-lawyer ownership is hardly a big one. If anything, it makes perfect sense and is entirely consistent with law being no different than selling laundry detergent. And if that's all the legal profession is to you, then there is no real impediment to opening the door to anyone who wants to skim a few points off the top of the law.
And the next step is to rid society of pesky lawyers altogether, and let anyone open a law shop and sell their wares. Would you like a mocha frappucino with your complaint?
So Jacoby & Meyers, and all those who are certain law is just another business, will finally get the opportunity to pursue wealth. Hopefully, this will present an opportunity to stop the race to the bottom.