This paper was presented at the 2008 ABA TechShow
The Need
What is eLawyering ?
eLawyering is a term used to refer to the practice of law over the Internet. It is more than Internet based advertising. eLawyering iniatives undertaken by the organized bar are usually focused on reaching a “latent market” of lower and middle class citizens in need of legal services.
Cost of legal services does not equal value of the service
The cost of litigation has exploded in the last ten years. Much of the cost of litigation is the product of inefficient and antiquated business processes. A major contributing factor to the cost is litigation’s dependence on paper. The dependence on paper starts with the litigants is perpetuated by their lawyers and is required by the courts.
The paper volume in just one court, the Circuit Court for Prince George’s County, Maryland, is an excellent example of this over-dependence on paper. There are 23 judges in this Circuit Court. In 1994, there were 42,700 cases filed, representing 1.7 million pieces of paper.
One of the great anomalies the advent of the personal computer has brought to the legal community is the creation of more paper without a change in the business processes which create the paper. The costs and inefficiencies of the overwhelming paper volume is requiring decision makers to examine the alternatives offered by the electronic world. Other businesses and institutions have successfully addressed their paper problems with electronic solutions, why can’t the litigation world and the legal profession?
Richard Susskind goes so far as to predict radical changes in the way lawyers will work. “The market will determine that the legal world is over-resourced, it will increasingly drive out inefficiencies and unnecessary friction and, in so doing, we will indeed witness the end of outdated legal practice and the end of outdated lawyers.†Professor Susskind contends that the delivery of legal services will follow other industries that have been radically reformed by the Internet. The weakness in this argument is that no authority can compel it and the legal services market is not efficient. This is evident when well thought out delivery models such as Legal Advice Line are met with considerable resistance from the bar, the courts and consumers.
The explosion of litigation over the last decade cannot be blamed on the legal profession and over-zealous lawyers as some would claim. The causes are much deeper and more reflective of the moral and cultural environment of the entire country. Part of the problem can be traced to the increasing diversity and separation of the country’s communities. As the notion of community has disappeared from major population centers people have resorted to the courts to resolve their differences rather than traditional community structures of family, church, and school. Part of this dynamic may also be attributed to a growing desire for privacy and anonymity in major urban population centers.
One needs to look no farther than pro se litigation to discover that the legal profession is not the cause of the communities’ run to the courthouse to solve almost every problem.
Linda Morris, Administrator for the Prince Georges County, Maryland, Family Court, put it best when she said, “Large numbers of Americans are choosing to represent themselves even when they can afford an attorney. They choose to be ‘lawyer less’ (pro se or pro per).†As Ms. Morris points out, “Income-qualified pro se litigants can get pro bono or some form of legal assistance from an attorney.†However, those who can afford legal services but choose not to hire a traditional lawyer because of cost have no where to turn when they need legal advice. Court administrators and clerks are prohibited from giving advice as they must remain impartial and are not authorized to practice law. This phenomenon of “I can do it myself†makes current pro se litigant procedures inadequate for the numbers and types of customers choosing to self-represent.
But this phenomenon is not limited to the pro se population as many consumer conscious groups have pointed out. Institutional litigators such as insurance companies and large corporations also regularly challenge the legal community to reduce the cost of legal services. They also require law firms to adopt integrated technologies the make the transfer of necessary information more efficient, less repetitive and less expensive.
The Promise
eCommerce
What is e-commerce? How will it impact dispute resolution and the business of dispute resolution? According to MIT professors Chris Westland and Ted Clark, “Electronic commerce, or e-commerce, is the automation of commercial transactions using computer and communication technologies.†E-commerce is in essence the computerization of markets whereby buyers and sellers are matched, a price determined and payment and delivery arranged. E-commerce is providing increasing opportunities because: (i) technology is user friendly; (ii) networks exist in stable forms; and (iii) business is reorganizing and re-engineering production and managerial processes.
What are the implications of the dynamics of e-commerce on the dispute resolution process? On the courts? The implications will manifest themselves on the substance and the process of litigation. The substance of litigation is the subject matter of the dispute. The process of litigation is the manner and method of filing and pursuing a claim in court.
Over the past decade we have witnessed an unrelenting marching evolution from purchasing EDI, to ATM dispensed cash, to pay at the pump ATM gasoline stations, to point of sale cash register computers, to Internet renewal of drivers’ licenses, to the purchase of books on the Internet. Simultaneously, it is becoming clear that the world is becoming borderless in the sense that time and space are no longer significant barriers to a business transaction.
So how do the courts and law firms fit into this electronic commerce picture? According to MIT e-commerce professors Westland and Clark in their textbook Global Electronic Commerce, there are three major types of electronic commerce: Business to Consumer, Business to Business, and Closed Group Networks. Industrial age goods and services are made available to the consumer through marketing channels. The information age has taken these channels out of the paper world into the electronic world. For the most part, courts and law firms fit the model of business to business (B2B) electronic commerce. The fit is not 100 percent because there are definite elements of business to customer involved in the businesses of both courts and lawyers. However, to the extent that courts and lawyers transact the business of dispute resolution, a clear case can be made for the B2B e-commerce model.
What is the dispute resolution channel of commerce? The channel begins with the facts of the dispute. That may be a simple automobile accident or a broken promise. Those underlying facts become the basis of a claim. Usually the claim takes a written form such as a letter, but many times the claim is made orally by an individual to an organization. If the claim is not finally resolved, then a lawyer is usually consulted. The lawyer then makes contact with the individual or organization and attempts to resolve the dispute. If the dispute is not resolved at this point then the lawyer typically will file a lawsuit in a court. Ultimately the court renders a judgment and the suit is finally resolved.
How does e-commerce and the information age affect this channel of commerce? Generally speaking, e-commerce changes a service-related channel of commerce to a transactional-related channel. In the transactional world, time, space and location become less significant. Therefore, a channel’s hierarchy is reduced and sometimes flattened as many steps in a process are removed or combined. The result is that lawyers, judges and clerks can concentrate on their core competencies becoming less distracted by exterior matters. Thus, the availability of networked information and high-speed computers allows for smaller, more nimble competitors to operate more profitably by focusing on their core competencies. In the industrial age, location was a driving consideration. For example, the three rules of the value of real property, location, location and location, make it clear how important the geography of a business was during the industrial age. In the information age, however, location is becoming insignificant as networked individuals and organizations compete from any place in the world.
If we can apply what is happening in other industries to lawyers and the courts in the dispute resolution channel of commerce, we can expect the following changes to occur:
• Time delays will be reduced
• Post office delays will be eliminated
• Time uncertainty can be reduced in financial transactions as a migration to electronic billing and purchasing occurs
• Immediate acknowledgment of receipt of information will allow for a better and more trusting relationship between lawyer and client and lawyer and Judge
• Communication of service completion to clients will allow clients to plan other business transactions in a timelier manner
• The one time entering of information will allow for greater efficiencies, reduced costs and increased profits
• Paper and mail costs can be reduced or eliminated
• Financial transactions can be automatically placed into proper accounting categories
• The danger of lost or destroyed paper can be eliminated
E-commerce makes location insignificant. So if a law firm in Hawaii can do a better, cheaper job, then they will compete for business in Georgia. E-commerce also changes distribution channels and creates new distribution channels. Peter Drucker, the management expert for the information age, points out that new distribution channels change the identities of customers. These distribution channels change how and what customers purchase. They change consumer interaction, patterns of financing and business structures. In essence, these channels change the entire economy.
Two Examples of eLawyering
Legal Advice Line
Legal Advice Line (see www.legaladviceline.com) has been providing assistance to this market since 1997. They have served almost 200,000 clients and prepared over 50,000 documents. The company uses state of the art Internet and document assembly tools to make unbundled legal assistance available to consumers at extremely low fixed prices. Its Internet virtual office ties together lawyers in all fifty states who are immediately available to clients for consultation over the telephone. This Internet technology makes it possible for the company to acquire the under-utilized time of lawyers and make it available to clients who need their help. The system makes it possible for attorneys to serve the needs of pro se clients from anywhere and on their own time schedule. Client intake records, record keeping, payment records, case notes, document review and pleading preparation are all handled through one integrated system. All that a court system needs to give pro se litigant’s access to these services is a telephone.
At the heart of this system is Legal Advice Line’s call center and proprietary case management website called CATS – the Client-Attorney Telephony System. At the center, triage attorneys and staff screen cases and set up client files on the website.
A database keeps automatic real time records of every client interaction. In the field service attorneys have access to these files through the password-protected website. Once a case is set up the service attorney is notified by instant message or by telephone. A conference call then links the client with the counselor in his state.
The attorney accesses the client file through a discrete and secure web page. He or she makes notes on the matter, categorizes the nature of the client’s concern and determines what action might be beneficial.
Case records are constantly monitored by senior staff at the call center to make sure nothing is overlooked.
An important part of the company’s pro se capability is the proprietary DASH document assembly system. Through it, either the telephonic consultation attorneys or, where appropriate, the pro se litigants themselves can prepare complete and accurate pleadings.
From the virtual office either the attorney or the caller can select the appropriate form from a simple electronic list. DASH is completely resident on the website and requires no downloads or plug-ins to operate correctly.
DASH will create completed legal forms in Word or WordPerfect format, which can be edited by the user at a later time. The system eliminates the need for the user to read and understand the legal form. Rather it asks the client to supply information in response to a series of questions. Carefully constructed decision trees automatically populate the form. The program will not permit necessary information to be omitted.
Payment can be handled through a variety of means. Online checks, credits cards or prepaid subscriptions, which generate PIN numbers for the client’s use.
Once payment is completed, accurate and complete sets of pro se pleadings can be downloaded at any location chosen by the user.
In combination with low cost access to attorneys licensed in each state, the document assembly system provides a complete answer to the needs of pro se litigants.
For more information about Legal Advice Line, contact Neil Ruther or Mark Cauchon at 1-888-367-5252.
VirtualCourthouseâ„¢
Founded in 2001 VirtualCourthouseâ„¢ ( see www.virtualcourthouse.com) is a breakthrough service in the legal alternative dispute resolution (ADR) process. VirtualCourthouse.comâ„¢ is an Internet-based service that enables parties to submit disputed claims, responses and supporting material in digital form for resolution by a neutral provider of Alternative Dispute Resolution (ADR) services. VirtualCourthouse provides all of the traditional ADR processes including arbitration, mediation, neutral case evaluation and settlement conference, however, VirtualCourthouse’s multimedia, internet-facilitated service and panel of highly qualified neutrals offer a more efficient, effective, and flexible process. VirtualCourthouse has developed the Dispute Resolution Engine (DRE) which has been deployed for several significant pilots with insurance companies, lawyers and neutrals. Almost 1,000 cases have been filed and adjudicated. Customer evaluations which are conducted on each case reveal a high level of user satisfaction with the technology and service. A dispute can be resolved for as little as $200 per party – considerably less than the time and expense involved in going to court.
A key benefit specific to institutions is VirtualCourthouse™’s flexible decision-making tools that access VirtualCourthouse™’s databases for providing statistical analyses on rulings trends by category, by geography, by neutral, by reward. Thus, VirtualCourthouse™ is itself a key tool in effective business planning. These ADR services can include arbitration, mediation, neutral case evaluation or a settlement conference by members of a panel of pre-qualified neutrals. VirtualCourthouse™ creates a marketplace by recruiting the neutrals, administering the electronic case file, and providing access to the system to members of the plaintiff and defense bar, including insurance staff counsel, claims agents and the parties. The service allows customers to rank neutrals and evaluate results, providing statistical analysis of trends in rulings and results. It also tracks cases, provides management reporting and oversight to institutional customers such as commercial companies, governmental agencies and courts. The system also provides a mechanism to refer cases to ADR programs.
VirtualCourthouseâ„¢ provides an independent forum by enabling parties to select qualified neutrals (typically retired judges or attorneys with specific experience), submit digitized materials, schedule an ADR event and track other activities throughout the effort to resolve the claim. Critical to the design of this service is its neutrality and independence: VirtualCourthouseâ„¢ impartially facilitates neutral selection by providing structured communication among parties via a controlled and secure message service. The system thereby assures the parties that ex-parte communications do not occur. It also allows the parties to communicate independently of the neutral in a secure private fashion. All communications relating to a case are recorded in a communication report. Any party can attach digital exhibits such as digital photographs or scanned images of medical records. The Neutral can use the message service to communicate with all parties thereby avoiding any potential of ex-parte communications. VirtualCourthouseâ„¢ streamlines every step in the process and minimizes the need and costs of unnecessary face-to-face meetings, scheduling conferences, mailing, and copying. The system allows institutions to choose customized elements to monitor the caseload, trends in case results and rulings by the neutrals. The increased predictability created by VirtualCourthouseâ„¢ provides a compelling value proposition to institutions facing increased pressure to use ADR services to reduce dispute resolution costs.
VirtualCourthouseâ„¢ is easy to use. Claimants and respondents submit their claims along with relevant supporting material in digital form. The most a user is required to have is a computer, if necessary a scanner, and Internet connection, and an e-mail account.
VirtualCourthouseâ„¢ delivers value to three separate constituencies – the claimant, the neutral and the respondent.
The VirtualCourthouse.comâ„¢ Internet process
The VirtualCourthouse.comâ„¢ process is simple and straightforward.
• A case is initiated and a list of Neutrals is selected and the Neutrals are ranked
• A system generated email is sent to the other party, inviting them to join the case
• The other party joins the case and a Neutral is agreed upon
• The Neutral reviews the case initiation, and sends an email to parties, confirming the type of proceeding (online or face to face) and the fees
• The claimant prepares a case presentation and uploads the scanned documents into the online case
• Once complete, a system generated email is sent to the respondent, advising that the claimant has completed the presentation, and now it is time to submit their case presentation
• Once the case presentations are complete, a system generated email is sent to the Neutral advising them to review the evidence and render a decision
• Once reviewed, a verdict is submitted online, and a system generated email is sent to both parties notifying them a verdict has been rendered
The Challenge
The legal profession has struggled to evolve its business processes and the delivery of legal services to channels of eCommerce. Only a few examples exist. So what is standing in the way of this evolution? Why can’t the legal profession keep pace with other business models?
There are many factors that inhibit and deter a true coordination of all of the elements necessary to allow for the virtualization of the legal profession. The people involved in the legal process, traditional legal institutions, and the types of information needed are all variables that prevent the legal world from solving its problems by electronic means. The participants in the legal process are the largest block to virtualization of the law. More often than not the lawyer – client views the delivery of legal services as a product of a relationship which often is personal as well as professional.
The litigants are a problem because of their geographical diversity, political diversity and institutional diversity. They have competing goals and they are usually participating in an adversarial capacity. The litigants do business and have disputes in different cities, different counties, different states, different regions and even different nations. No individual court, legislator or executive has authority to compel their action.
The courts, where disputes are resolved, are also geographically, politically and institutionally diverse. There are federal courts, state courts and county courts. Each court is created by a separate constitution and separate legislation. Each court is also funded by a different executive/legislative budget process. County courts in some states are funded entirely by the state budget, while others are financed only by the county budget. Some courts even receive funding by a combination of state and county budgets.
The Washington-Baltimore metropolitan area is just one example of the many metropolitan regions which have legal systems that are not currently conducive to virtualization. The Washington-Baltimore region is composed of two states, Maryland and Virginia, and the District of Columbia. Within this region, the Federal court system is composed of four separate courts: (i) the U.S. District Court for Maryland-Baltimore; (ii) the U.S. District Court for Maryland-Southern Division-Greenbelt; (iii) the U.S. District Court for the District of Columbia; and (iv) the U.S. District Court for Northern Virginia. There are nine state trial courts: (i) Fairfax; (ii) Arlington; (iii) DC Superior Court; (iv) Prince George’s County; (v) Montgomery County; (vi) Howard County; (vii) Anne Arundel County; (viii) Baltimore City; and (ix) Baltimore County. These fifteen separate trial courts have separate computer systems and separate databases and separate ways of doing business. Moreover, no one jurisdiction has the capacity to compel another to subscribe to their way of doing business. These characteristics prevent the courts and the attorneys from unifying legal business by electronic means.
It is all about change
Change is an inevitable product of the technology offered by the information age infocosm. Ordinarily, people resist, fight or ignore change. When those dynamics of resistance occur, change in people’s work patterns occur very slowly and productivity decreases. On the other hand, when change is embraced with an attitude of acceptance, people’s work patterns change very fast and productivity dramatically increases.
Change is the master of all productivity improvements. Without change, there is little room for improvement. With change, the foundation for improvement is set. Change, however, does not guarantee improvement and success. Many people have examined the elements of change over the last decade. While some businesses have taken a radical approach, others have taken a methodical approach. Both approaches are probably needed to effectuate efficient change.
Re-engineering guru Michael Hammer represented the radical approach in the early 1990s when he said: “It is time to stop paving the cow paths. Instead of embedding outdated processes in silicon and software, we should obliterate them and start over.†Hammer advocated a “re-engineering†of our businesses using the power of information technology to radically redesign our business processes in order to achieve dramatic improvements in their performance. He maintains that the heart of re-engineering is the notion of discontinuous thinking or recognizing and breaking away from outdated rules and fundamental assumptions. Hammer’s principles of change are:
(1) Organize around outcome not tasks;
(2) Have those who use the output of the process perform the process;
(3) Subsume information-processing work into real work that produces information;
(4) Treat geographically-dispersed resources as though they were centralized; (5) Link parallel activities instead of integrating their results;
(6) Put the decision point where the work is performed and build control into the process;
(7) Capture information once at the source.
Finally, Hammer says to THINK BIG. Over the last fifteen years, the radical-obliteration approach has moderated into the more methodical approach. This approach is represented by David Osborne and Peter Plastrik’s 1997 book Banishing Bureaucracy. Their thesis is that organizations and, therefore, processes, change when a few fundamental levers of activity are changed. This results in cascading change throughout the organization. Osborne and Plastrik maintain that “[t]here is no recipe you can follow to reinvent government, no step-by-step progressions you must adhere to.†In order to impact the levers in each organization, they must be approached with a clear strategy. Osborne & Plastrik identify the five Cs of change as:
PURPOSE: Core Strategy, Clarity of Purpose, Clarity of Role, Clarity of Direction
INCENTIVES: Consequences Strategy, Managed Competition, Enterprise Management, Performance Management
ACCOUNTABILITY: Customer Strategy, Customer Choice of Service, Competitive Choice, Customer Quality Assurance
POWER: Control Strategy, Organizational, Empowerment v. Hierarchy, Employee Empowerment, Community Empowerment
CULTURE: Culture Strategy, Breaking Habits, Touching Hearts, Winning Minds.
The challenge is to apply these principles to the process of litigating disputes and delivering legal services so that the repetitive, costly, paper-dependent process can be replaced by electronic processes which allow the sharing of information without the necessity of redundantly repeating the input of the information. In other words, integrate the litigation process.
How barriers to change are removed
Students of the dynamics of CHANGE will testify that change does not occur unless there is:
• Leadership
• Strategy
• Management
The first step is the most critical – Leadership. The bar, the courts and the litigators need to make change a priority. For instance, Chief Justice Malarkey of the Colorado Supreme Court resolved to do electronic filing in 1999. Then the Chief Judge told the rules committee to adopt a rule – not to debate electronic filing. Today Colorado is the only state to have state wide electronic filing of court documents. Now that is leadership. The adoption of electronic filing in the courts helped spur the organized bar in Colorado to also embrace electronic filing. A domino effect ensued with the court clerks – then the prosecutors – then the litigants. That is how leadership motivates change. But one must ask why is there only one out fifty states that has electronic filing. Is it because leadership has not commanded the change? eLawyering faces the same challenges and obstacles. Who will lead the way?
Cost of legal services does not equal value of the service
The cost of litigation has exploded in the last ten years. Much of the cost of litigation is the product of inefficient and antiquated business processes. A major contributing factor to the cost is litigation’s dependence on paper. The dependence on paper starts with the litigants is perpetuated by their lawyers and is required by the courts.
by Judge Arthur M. Monty Ahalt ( Ret.) – March 13, 2008
