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Delivering Online Legal Services: How to Set Up and Operate a Virtual Law Practice

With the advent of the internet and growing new technologies, attorneys need not be bound to the structure of a "brick and mortar" business model.  Lawyers can now reach out to potential clients and resources through the use of extranets, cloud based software platforms, and network legal information as well as better communicate with current clientele over the internet.  Richard Granat joins Damien Allen to discuss "The Virtual Law Firm"

Announcer:  Welcome to GAL Radio brought to you by the Greatest American Lawyer blog, changing the way law is practiced through technology, innovation and creativity.  Turning the business of law on its head and shaking things up to the betterment of clients, lawyers, law firms and society.  Now here’s your host, Damien Allen.


Damien Allen:  Good afternoon and welcome to GAL Radio.  My name is Damien Allen and joining me today on the phone is Attorney Richard S. Granat of Directlaw.com and Mylawyer.com.  He’s also the Chair of the Elawyering Task Force of the Law Practice Management Section of the American Bar Association, and today we’re discussing delivering online legal services and how to set up an operative virtual law practice, and I know the American Bar Association is issuing guidelines as the major focus for them. Richard, welcome to the program. 


Attorney Richard S. Granat:  Hi, Damien.  Good afternoon. 


Damien Allen:  Pleasure to have you on the show today, sir.  Could you please tell us what is a virtual law practice?


Attorney Richard S. Granat: Well, a virtual law firm is really characterized by access to the law firm through what we call a client portal where clients can sign on with a username and password.  It’s not like a typical website that you see which just has the lawyers biographies and some legal information, but is really a platform under which the law firm can actually deliver legal services to the client and relate to the client online,  collaborate with the client, give legal advice online.  It’s essentially a vehicle for online legal services, and this is something new.  We sign onto our bank or we do our brokerage online, we do our travel online, but law firms are not really done that before.  They haven’t had what we call a secure client portal where the client could actually sign on to the law firm. 


Damien Allen:  What is a client portal, and how does it work?


Attorney Richard S. Granat:  A client portal is a secure space.  So, any data that’s going between the client and the law firm is totally encrypted and it’s totally secure.  Within that portal, lots of legal things happen.  In terms of the delivery of what we call online legal services.  Clients can create documents, they can talk to their lawyers by email, but this is secure email, they can collaborate with their attorneys, they can check the calendar in terms of meeting dates, they can pay their bills online; all this happens securely.  Just think of the portal that you might have with your brokerage firm and all the things that you do with your brokerage firm, except in this case, there are legal tasks that are really getting done.  And it becomes the major platform by which the law firm can deal with its clients, particularly those clients that want to deal with the law firm online. 


Damien Allen:  Now, Richard, my attorney or an attorney may have a website.  Does this make it a virtual law practice?  What’s not a virtual law practice? 


Attorney Richard S. Granat:  Sometimes people think that a law firm just without a physical office is a virtual law firm, but it’s not.  Just an office sharing arrangement or a law firm that’s actually working out of their home, you know, just because you’re working out of your home in your pajamas doesn’t make you a virtual law firm, even though you may be just using email.  Again, what’s characteristic is that the client has to be relating to the law firm through this concept of a client portal where they sign on with a username and password on the web itself.  If you’re just working out of your house, but you’re delivering legal services in the normal way and you’re meeting your clients down at Starbucks and you’re just generating an email, we don’t really call that a virtual law firm, any more than a bank would call themselves virtual bankers in terms of online banking.  It’s really a different idea and different concept.  It’s really the same distinction that legal services are really delivered through the website itself.  That the website is really not just the equivalent  of what we call a Yellow Page ad without any kind of interactivity, without any kind of dialog or any kind of interchange or any kind of legal services actually being delivered by the law firm.  So, that’s really new for law firms, particularly for solos and small practitioners.  But these practitioners are being now threatened by what we call non-lawyer entities on the web like a Legal Zoom, which is an organization that provides essentially legal forms but not true legal services the way in which a law firm would provide.  So, in a virtual law practice, it’s really an entity that’s providing true legal services, but it’s using the internet as the platform for the delivery of legal services.  And that’s because our technology is changing, which now really makes this possible and you really couldn’t do this before. 


Damien Allen:  Richard, what are the changing technologies that make this possible now?


Attorney Richard S. Granat:  Of course, we’re talking about the internet where people now have widespread broadband access which means that their connections are faster.  But the most important change in technology, I believe, is this concept of delivering what we call software as a service, which really means that the data and the applications are hosted outside of the law firm’s own environment.  When you have what is software as a service, it enables the law firm to subscribe to very complicated applications for a very low monthly fee.  Previous to this, only the largest law firms had what we call client portals, and now, of course, we had some small law firms that experimented and built their own technology, but by and large, the great range of solos and small firms - and don’t forget, we have almost 500,000 law firms in the United States with under 10 attorneys – couldn’t really afford the kind of complicated technologies that would really create what we call a client portal that offers the delivery of legal services to law firms.  A second technology that’s becoming very important that didn’t really exist before in a way that was easy for consumers to use is the idea of web-enabled document automation.  In web-enabled document automation, the client essentially answers a bunch of questions through the web browser and using an artificial intelligence engine, the document, the first draft of the document, is immediately created and ready for the lawyer’s further advice, amendment and revision.  So, this makes for a very efficient process because rather than having the client go down to the lawyer’s office and the lawyer writing on a yellow pad what the client really wants, the client is answering a set of questions in the web browser, and then from that data, a document is actually created.  This creates very high efficiencies for the lawyer, and that’s actually very convenient from the client’s point of the view. 


Damien Allen:    What are some of the benefits of having a virtual law practice?


Attorney Richard S. Granat:  Well, in terms of benefits, first of all, it enables the lawyers to capture what we call a connected generation of clients, clients who are grown up in a Facebook and MySpace generation and just think automatically that they really want to connect with their lawyers online.  So, this gives them a facility to capture those clients that are on the internet.  Plus it creates, even for a more traditional clients, a more convenient environment rather than have the client give up a day of work and come down to the lawyer’s office and spend a couple of hours waiting in the anteroom until they can actually have a meeting.  The lawyer is really available 24/7 through their website, and questions can be posed and the lawyer can answer those questions whenever they can, basically what I call asynchronously, that can answer it in the evening when it’s convenient.  And we see this trend where telephone tag is reduced, it’s a better client experience, the whole environment of relating to the lawyer becomes more transparent, because documents can be uploaded to the clients space, the client can see what the lawyer is actually doing in terms of the work-product, billing can be done online.  From the lawyer’s point of view, that’s more convenient because it can be paid more promptly by essentially getting paid by credit card online.  It’s actually a greener strategy because not having to invest in a large physical plant reduces a lawyers footprint.  It certainly lowers overhead costs, and lowering overhead costs results in actually lower consumer pricing for legal fees.  So, we see this as a whole way of streamlining a law practice.  It also, when a law firm is operating on the web, it increases the reach of the law firms.  So, rather than just having to operate in their own little neighborhood or their city, they can expand their services to reach throughout the whole state in which they’re a member of the bar.  The way in which this software now works, it doesn’t require any hardware or software installation.  It’s really easy for a law firm to get up and running, and this kind of convenience enables the lawyer to really access data and access their client records wherever they are.  So, really, is implementing the dream of anywhere, any place computing.


Damien Allen:  What are some of the risks that are involved in having a virtual law practice? 


Attorney Richard S. Granat:  Well, I think there are always certain kinds on risk depending on the clientele that you have.  Certainly, if you have a client who is challenged in terms of literacy, they’re going to have some problems because the internet is still a text medium.  To the extent that we have multimedia, it will become easier to use, but you have to be able to follow instructions and you have to be able to read and you have to make sure that obviously the client that you are supposedly dealing with is truly the client and is not a dog for example or whatever.  In other words, there are issues about how to authenticate the client so that you can make sure that the person that you are actually dealing with is truly the client and not somebody who is impersonating the client.  When a law firm decides to deliver what we call unbundled legal services, which is legal services purchased a la carte, legal services that the client buys just the legal services when they need it based on the particular task.  The lawyer has to make sure that the client enters into a limited scope agreement so that the client’s expectations don’t exceed what the lawyer’s actually promising to deliver.   I think that’s pretty much it.  There’s always, I think, a little learning experience in getting used to a new venture, but the risks in my view are no more than the risk in an offline practice. 


Damien Allen:  One of the major focuses of the American Bar Association is to issue guidelines for virtual law practices.  Are there ethical issues that need to be dealt with in a practice such as this?


Attorney Richard S. Granat:  Sure, and we actually have some guidelines which we call minimum requirements for law firms delivering legal services online.  Just because a lawyer starts delivering legal services over the internet, it doesn’t mean that they can check their ethics at the door.  In the sense that these sites have to be what we call ethically compliant in the sense that law firms still have to do a conflicts of interest check.  They have to make sure that they don’t serve any clients that are not within the jurisdiction that they can serve.  So, I’m a Maryland lawyer, but I can’t serve clients that are based in California because I’m not a member of the California Bar.  You have to make sure that the software provider can maintain the security and the integrity of the records that they have and that they’re storing so there’s no breach of client confidentiality.  If the law firm collects funds online, normally those funds have to go into what we call the attorney’s trust account, which is a separate account where attorney’s client  funds are actually kept until they’re actually spent.  I think that’s pretty much it.  I think it’s also important to make sure that every client, if it’s an internet client - and that’s somebody who you knew previously - signs on to a retainer agreement prior to creating the lawyer-client relationship.  That retainer agreement has to really specify what the scope of services are and when the relationship will begin and when it will end and how much it will cost.  Without those kinds of protections, as I’ve said before, the clients expectations may really exceed what the lawyer’s prepared to deliver. 


Damien Allen:  Thank you very much for joining us today, Richard and discussing operating a virtual law practice with us.


Attorney Richard S. Granat:  Thank you very much, Damien. It was a pleasure. 


Damien Allen:  We’ve been speaking with Richard S. Granat of Directlaw.com and Mylawyer.com.  He’s also the Chair of the Elawyering Task Force Law Practice Management Section for the American Bar Association.  We’ve been discussing how to set up and operate virtual law practice, delivering online legal services.  You’ve been listening to GAL Radio.  My name is Damien Allen.  Everyone have a great afternoon.


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