The Importance of Keeping Complete Client files

Do you keep a complete copy of your client files?  If not, does your reasoning fall into one of the following categories:

 

Let’s consider these arguments individually.

Rationale: I don’t want to store the paper

Agreed!  I don’t blame you one bit.  Talk about inconvenient!

  • You could keep files at home, but no one wants to do that and some of us don’t have the space.
  • You could keep files in your office, but it can look like a clutter bomb went off.
  • This leaves the expensive option: keeping files off-site.

Solution: Scan your closed files

The easiest solution is to stop adding to the problem.  Resolve to scan your closed files starting this year.  Most practitioners will need a scanner for Oregon eCourt.  Put it to work as a file retention tool.

Rationale: Scanning is too time consuming

If your paper files aren’t “scanner” friendly, digitizing them at closing time can be tedious and time-consuming.

Solution: Make your life easier and scan as you go

Scanning paper as you receive it means all file materials are electronic from the start and the work is done automatically over the life of the file.  In fact, if you “scan as you go,” there is no reason not to simply be paperless.

After scanning, paper can be:

  1. Shredded
  2. Given to the client
  3. Kept for a designated amount of time in a general chron file
  4. Kept for a designated amount of time in simplified client file (e.g., dropped into an expanding file folder)

Exceptions may apply to certain types of originals.  See the PLF File Retention Guidelines, available on the PLF website.

Rationale: The court has all my pleadings

This is a specific example of the argument that if someone else has a copy of the documents stored in my file, I don’t need to retain my set.

Solution: Keep it real

No one else possesses your exact client file, as you gathered it, for the purpose you gathered it.

When you decide that it isn’t necessary to keep copies of the documents you filed in court, the medical records used to prove your client’s damages, or some other part of your file on the grounds that “someone else has a copy,” you are taking a huge risk.

Many a lawyer has regretted the decision not to keep records because “they were available elsewhere.”  For example, the lawyer who said he withdrew from a case long before a judgment was entered against his former client.  The lawyer claimed he withdrew, but had no documentation in his file.  The court’s Register of Actions showed receipt of a letter from the lawyer seeking to withdraw, but when a PDF of the court file was obtained, there was no letter.  Maybe the letter never made it into the paper file.  Or perhaps it was missed when the file was scanned.

Regardless, the moral of the story is pretty apparent: anyone (including a court clerk) can misplace, misfile, or lose a document.  Never rely on another person or entity to keep your records.  PLF claim files are replete with similar examples.

In the event of a legal malpractice claim, it may be crucial to prove what you did nor did not have in your file.  And while it may be possible to obtain duplicate records, doing so does not establish they were previously in your possession.

Additionally, defending the practice of discarding part of your file can be quite uncomfortable at deposition or in front of a jury.  Jurors hold lawyers to a high standard and often naturally have sympathy for the plaintiff bringing a claim.  If your testimony shows that you shredded part of your file, jurors may draw the wrong conclusion about your motives.  Play it safe and keep your complete file.

All Rights Reserved [2015] Beverly Michaelis

 

Practice Alerts for Oregon Lawyers

Professional Liability Fund Practice Alerts are a quick, easy way for Oregon lawyers to stay informed about developing legal news and practice management announcements.

With an RSS feed you can subscribe to alerts and receive new posts automatically in your browser or e-mail inbox  without the need to login or monitor the PLF website.  Examples of recent post topics include:

  • Are you eCourt Ready?
  • Temporary eFiling Restrictions Lifted
  • UTCR 21.140 Amended Out-of-Cycle
  • Office Productivity in the Cloud: Is Office 365 Right for You?
  • eCourt Service Status – Temporary eFiling Restrictions
  • eCourt Mandatory effective December 1, 2014

You can also follow the Professional Liability Fund on social media, including:

Social media accounts are used to share news, events, CLE announcements, job opportunities, discounts, and useful practice tips.

Stay in touch!

[All Rights Reserved – 2015 – Beverly Michaelis]

Crowdfunding Your Law Practice

crowdCrowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the Internet.

The crowdfunding model is fueled by three types of actors: the project initiator who proposes the idea and/or project to be funded; individuals or groups who support the idea; and a moderating organization (the “platform”) that brings the parties together to launch the idea.

In 2013, the crowdfunding industry grew to be over $5.1 billion worldwide.
Source: Wikipedia.

Crowdfunding for Lawyers

Potentially, lawyers could use crowdfunding at any time – to jumpstart a law practice, expand a law practice, or bridge the gap during a downturn in business.

As you might expect, crowdfunding is most successful when used to promote a cause or new product idea rather than a service.  But it could work for lawyers if donors find the practice area and marketing pitch appealing.

The Ethics of it All

Before we get too excited about this idea, we need to do a gut check.  Simply put: is crowdfunding ethical?

A quick Internet search produces a list of posts and articles on the subject.  Here are a few:

The first result is by far the most interesting for Oregon lawyers.  In Crowdfunding: The Future Of Public-Interest Funding? author Sam Wright reports a conversation with Oregon lawyer Kellie Ann Furr who is crowdfunding a “private-public interest environmental law firm” on Indiegogo.  Furr is halfway to her fundraising goal of $7,500.  Take the time to look at her campaign and you’ll understand the appeal and her success.

But back to the ethics of it all…

In his Above the Law post about Furr, Wright tells us:

First, she sought and received an informal opinion from the Oregon State Bar on “the ethics of donation-based crowdfunding” to make sure she was on sound ethical footing. She was also careful to select “perks” for donors that would not affect her “professional independence” — in her case, the perks mostly involve volunteer time or pro bono assistance to environmental organizations. And she includes appropriate disclaimers on her campaign page.

So does this mean Oregon lawyers are off and running – free to set up crowdfunding campaigns without a second thought?  Not quite….

Crowdfunding is a “Communication Concerning a Lawyer’s Services” for Purposes of Oregon RPC 7.1

By necessity, crowdfunding involves representations about your potential or ongoing law practice. Therefore, Oregon RPC 7.1 – Communication Concerning a Lawyer’s Services – would apply to the content contained in your crowdfunding appeal:

“A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. A communication is false or misleading if it contains a material misrepresentation of fact or law, or omits a fact necessary to make the statement considered as a whole not materially misleading.”

Simply put: lawyers are responsible for ensuring that representations made about their practice are accurate.  For an excellent discussion of this topic, see OSB Formal Opinion No. 2007-180 Internet Advertising: Payment of Referral Fees and the following articles:

“Dishonesty, Fraud, Deceit, or Misrepresentation” – the Companion of RPC 7.1

A violation of Oregon RPC 7.1 (communication that is false or misleading) could also implicate Oregon RPC 8.4:

“It is professional misconduct for a lawyer to … “engage in conduct involving dishonesty, fraud, deceit, or misrepresentation that reflects adversely on the lawyer’s fitness to practice law.”

But lawyers can run afoul of RPC 8.4 in other ways.  As discussed below, crowdfunding campaigns often promise “rewards” or “perks” for donors.  Assuming that offering something in return for a donation is ethical, failing to deliver the “reward” or “perk” if all conditions are met would likely be construed as a violation of 8.4.

The Granddaddy of them all: Is Crowdfunding Fee Sharing with a Nonlawyer?

Lawyers and law firms are prohibited from sharing legal fees under Oregon RPC 5.4, except in limited circumstances.  This begs the question: if a donor gives a lawyer money to fund his or her law practice, does this constitute impermissible fee sharing?

Maybe yes.  Maybe no.  Where is the “fee” and how is it “shared?”  Compare the following scenarios:

  1. Lawyer and nonlawyer wish to form an LLC offering business advice.  They intend to charge potential clients a flat fee of $1,000 for their services and split the fee 50/50.  Lawyer will provide the legal advice; nonlawyer will coach clients on business strategies, financing, marketing, and the like.
    While this arrangement raises a number of issues, the question here is: does the proposed fee split violate Oregon RPC 5.4?  The answer is a straightforward: yes!
  2. A donor gives money to a lawyer to start her law practice, no strings attached – the funds are a gift, not a loan; the donor is seeking nothing in return; the lawyer is providing nothing in exchange for the donation.  There is no “fee.”  There is no “sharing.”  The donor could be Mom, Dad, a friend, or a stranger responding to a crowdfunding appeal.  It is hard to understand how this could be a violation of RPC 5.4 – but as always, I encourage readers: take your questions to the experts – OSB General Counsel’s Office.

So crowdfunding looks like a “go,” right?  Not so fast … here’s the thing about crowdfunding.  Donations aren’t generally a “gift” with no strings attached:

The Crowdfunding Centre’s May 2014 report identified the existence of two primary types of crowdfunding:

Rewards crowdfunding: entrepreneurs pre-sell a product or service to launch a business concept without incurring debt or sacrificing equity/shares.
Equity crowdfunding: the backer receives shares of a company, usually in its early stages, in exchange for the money pledged. The company’s success is determined by how successfully it can demonstrate its viability.

Source: Wikipedia.

Permitting donors to take an equity interest in your law firm is clearly impermissible under RPC 5.4.  A rewards approach could quickly go awry if the lawyer violated RPC 7.1, 8.4, or other applicable rules.  Remember Kellie Ann Furr?  Her Indiegogo campaign offers four different “perks” or rewards for donors:  volunteer time, pro bono work, or a one-hour consultation.  She carefully limits the one-hour consultation to Oregon residents only and includes a disclaimer that donating to her campaign does not create an attorney-client relationship. Is this sufficient?  At the risk of repeating myself: take this question to the experts – OSB General Counsel’s Office.

Funding a Law Practice Is Only Part of the Picture: Student Loans, Litigation, and Securities Regulation

Crowdfunding raises issues in other areas as well.  Check out these posts:

Learn More

If you want to learn more about crowdfunding, read the following:

Next, get ethics advice – from independent ethics counsel with whom you form an attorney-client relationship or OSB General Counsel’s Office.  The General Counsel’s Office can help you identify applicable rules, point out relevant formal ethics opinions and other resource material, and give you a reaction to your ethics question – they are always a good place to start.

All Rights Reserved [2015] Beverly Michaelis

Postscript:

In addition to the above, practitioners should also consult with a tax lawyer or CPA. Money raised via crowdfunding will likely be considered taxable income. Check out these guidelines, available from PayPal. A word of caution: as noted here, failure to meet PayPal’s threshold for purposes of generating a 1099 doesn’t mean you aren’t obligated to report the income.

A New Year – A New Opportunity

Each new year offers an opportunity for a fresh start.  A chance to do things differently to improve your life and your practice.

If your goals for the new year include any of the following:

  • Reducing your stress levelNY
  • Improving your office routines
  • Increasing productivity
  • Streamlining office systems
  • Balancing the demands of work and home

but you’re not sure where to start, check out these classic posts on how to “spring clean” your office systems and work habits.

Feeling Overwhelmed?

If you’re an Oregon lawyer, you have a great resource right in your own backyard:  the Oregon Attorney Assistance Program.  The OAAP can give you guidance on how to develop your own stress management program using deep relaxation, meditation, time management, and other proven stress-reducing techniques.  Best of all, OAAP services are free and confidential.  If you are looking for help in any of these areas, please give the OAAP a call at 1-800-321-6227.

Looking for Practice Management Advice?

Is it time to revamp your office systems and procedures?  We’re here to help! Professional Liability Fund Practice Management Advisors provide free and confidential assistance with office systems.  If you’re a lawyer in Oregon, give us a call!  800-452-1639 Toll-Free in Oregon or 503-639-6911.

All Rights Reserved – Beverly Michaelis [2015]

2014 WordPress Helper Monkeys

The WordPress.com stats helper monkeys prepared a 2014 annual report for this blog.

Here’s an excerpt:

The Louvre Museum has 8.5 million visitors per year. This blog was viewed about 71,000 times in 2014. If it were an exhibit at the Louvre Museum, it would take about 3 days for that many people to see it.

Click here to see the complete report.

The Year in Review – Top Posts in 2014

Thank you loyal readers!  As 2014 comes to a close, here is a look back at the year’s top posts:

eCourt

mouseAre you eCourt Ready?
Calculating Deadlines Using the REGISTER OF ACTIONS
eCourt Notices: Forwarding is Up to You
Rejected Filings and Relation Back
Searching eCourt Calendars

Fees – Getting Paid, Credit Cards, Trust Accounting

Partnership & Of Counsel – Managing Money – Leaving – FormingBusinesswomen Balancing Over Money

IOLTA Accounts and Partnerships – Dos and Don’ts
I Say Of Counsel You Say…
Leaving Your Firm
Thinking about Partnership?

Technology

Unbundling and the Nontraditional Practice

The Nontraditional Law Practice
Establishing a Successful Home-Based Practice

 

 

 

[All Rights Reserved 2014 – Beverly Michaelis]

Oregon eCourt Q and A

Looking for answers to frequently asked eCourt questions?  Check out this Q & A session from the November 19, 2014 Oregon eCourt Update CLE, jointly sponsored by the Oregon State Bar and Professional Liability Fund.

 

What Should I Do About Lost or Stolen Client Files?

imagesIs there any worse feeling than having your briefcase or laptop stolen?

While it can be hard to bounce back from such an experience, there are immediate steps you should take  if you discover that confidential client files have been compromised.

  1. File a police report.
  2. Don’t risk your personal safety. While Find my iPhone and MyLaptopGPS can track lost or stolen mobile devices and laptops, leave the police work to the police.  Do not confront the thief.
  3. If your laptop or mobile device is missing or stolen, notify your IT department.
  4. Change your network user name and password.
  5. Consider changing your user name and password for all accounts – anything you access via the Web.
  6. Check lost-and-found if applicable.  Believe it or not, laptops, devices, and briefcases get turned in by honest citizens.  Don’t give up until you try.
  7. Monitor Craigslist.  If you believe a thief has posted your property for sale, inform police.
  8. Contact your business insurance or liability carrier.  Property, valuable papers, or data breach coverage may cover the cost of replacing your laptop or reconstructing files. Beginning in 2013, the PLF added a Data Breach and Cyber Liability Endorsement to all excess coverage plans. The endorsement provides coverage for information security and privacy liability, privacy breach response services, regulatory defense and penalties, website media content liability, and crisis management and public relations services. Read more here.
  9. Inform your clients.  This is never easy, but clients must be informed if confidential information has been compromised. A sample notification letter is available on the PLF website.  Select Practice Management > Forms > Client Relations > “Notice to Clients re Theft of Computer Equipment.”
  10. Begin reconstructing your file.  Lawyers who are straightforward about an office break in or theft often find that clients are sympathetic, understanding, and more than willing to help.  With a bit of luck, you should be able to reconstruct most or all of your file from your backup or documents supplied by clients.
  11. Going forward, consider storing passwords or other sensitive information in an encrypted password manager.
  12. Backup, backup, backup!  Online backup services are a great way to automatically back up your laptop’s data.  Read more about backup protocols and available resources on the PLF website. Select Practice Management > Forms  > Technology > “How to Backup Your Computer.”
  13. If the theft occurred during an office break in, reassess building security. Talk to the building owner or property manager about alarms, surveillance, or other measures.
  14. Learn more by reading Protect Confidential Files – It Helps!
  15. Call your friendly Law Practice Management Advisor for help.

Scanning Documents for eCourt

mouseIn my last two posts, I discussed the 10 steps all practitioners should take to get ready for eCourt and how to manage the anxiety and stress of transitioning to the eCourt system.

This week the focus is on two essential eCourt tools: PDF and OCR software. 

Efficiency with a 2 in 1 Solution

There is no doubt in my mind that a two-in-one solution is best: PDF conversion software with OCR capability built-in. 

Most practitioners know immediately what a PDF document is, but not everyone is familiar with the acronym OCR

OCR refers to “optical character recognition,” and OCR software does exactly that.  It takes a scanned image – like your printed pleading document – and uses software to recognize the text on the page, making your scanned document searchable.  This is a necessity for eFiling under the Uniform Trial Court Rules. 

Software that can perform these two functions simultaneously is a great time saver. 

Assuming you have a working scanner that meets your needs and is compatible with your operating system (Mac OS or Windows 7/8), the next step is to get your hands on two-in-one PDF and OCR software.  If you don’t already have a scanner, see last week’s post for suggestions

Top Three Choices for PDF/OCR Software

  1. For me, the number one choice for PDF/OCR software is Acrobat XI.  As I said last week: get the “Pro” version for the redaction features. Adobe is running a 20% off sale on monthly subscriptions for two more days (the sale expires December 3).  See last week’s post to learn more.
  2. Nuance Power PDF Advanced would be my second choice.  Over the years, Nuance has expanded product features to compete against Acrobat – to the consumer’s benefit. 
  3. Coming in last is PrimoPDF.  I admit this is my personal bias, however, I don’t feel it is as robust as the other two choices. 

All three of these programs convert to PDF and all three have OCR software built-in to make your scanned documents text searchable. 

Setting Acrobat XI Pro to OCR Automatically

By default, Acrobat XI Pro should be set to OCR automatically if you initiate document scanning by using the program.  To verify that Acrobat XI Pro is set to OCR automatically, follow these steps:

  1. Start Acrobat XI Pro 
  2. Select Create
  3. Choose “PDF from Scanner”
  4. Move your cursor to the bottom right of the pop-up menu and select “Configure Presets…”
  5. Toward the bottom of the “Configure Presets…” box, verify that “Optimize Scanned PDFs” and “Make Searchable (Run OCR)” are selected
  6. Click Save then Close

Acrobat XI Pro will retain these settings.  As long as you initiate a scan from within Acrobat XI Pro, your documents will automatically be OCRed.  Follow these five simple steps to scan a document using Acrobat XI Pro:

  1. Load the document(s) in your scanner
  2. Start Acrobat XI Pro 
  3. Select Create
  4. Choose “PDF from Scanner”
  5. Select Black & White Document

and you’re done! 

Prove to Yourself that Your Scanned Document is Text Searchable

To prove that your PDF is searchable, type <ctrl> F if you are a Windows user; <command> F if you are a Mac user.  The “Find” box pops up:

find box

Enter a search term you know is contained within your document, such as your client’s name.  Click Next.  In a text searchable PDF, Acrobat XI Pro will jump to the first instance where the search term is found.

[All Rights Reserved – 2014 – Beverly Michaelis]