Washington Lawyer - May 2020 - 13

FEATURE

ollowing decades of near stasis, the
traditional law firm business model
may be facing a significant makeover
in the United States. A laundry list of
factors has brought the situation to a
head, from the mounting cost of legal
services to plateauing law firm growth to
deteriorating access to legal services for
low- and middle-income clients.

"We're finally at a place where it's possible to have the technology to
address some access to justice issues and make a real impact on the
offering of legal services," says James W. Jones, a senior fellow at the
Center on Ethics and the Legal Profession at Georgetown University Law
Center. "It's time for a major step forward, and to the extent our current
regulations get in the way of making it possible, we really ought to be
rethinking them."
Legal regulators in the United States are doing just that. State task forces
are examining initiatives to improve access to legal services and enhance
competitiveness. The likely focus? Their versions of ABA Model Rule 5.4
- the near-universally adopted guideline that generally prohibits lawyers
or law firms from sharing legal fees with nonlawyers, restricts lawyers
from forming partnerships with nonlawyers, and forbids investment
banks or outside companies from acquiring law practices.
This turning point tracks back to the Great Recession of the late 2000s
and the economic aftershocks that rocked the legal industry, as well as
recent technological advances that broke down geographic and cultural
barriers. Most importantly, the law firm's client relationships morphed in
response to these triggers, creating more demanding and knowledgeable
consumers of legal services.
Many in the legal profession have argued that the best option for surviving these pivotal changes is to reconfigure conventional law firms,
whether the threats are technological, economic, or cultural. Revamping
the law firm business model is the latest reform initiative and the most
promising, some would argue, to transform a 20th-century framework
into a 21st-century success.
In recent years, the alternative business structure has gone from a novel
idea to a reality in other countries, and to great advantage. With governing rules rewritten, accounting firms and corporations have integrated
legal services into their portfolios, and law firms have brought on nonlawyer partners. The effort has increased legal access for low- and middleincome clients and financial opportunities for law firms and their new
competitors.
"Many have recognized that, in the delivery of legal information and other
legal services, there's been a lack of innovation as compared to other
industries," says Scott Bales, executive director of the Institute for the
Advancement of the American Legal System (IAALS), a nonprofit at the
University of Denver. "Many people think, and there is some truth to it,
that the lack of innovation is also reflected in how we've regulated the
delivery of legal services, too."

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Washington Lawyer - May 2020

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