Crowdfunding: The More Things Change….

The first post to this blog argued that a lawyer’s duty of competence includes a duty to stay abreast of developments in technology and the benefits and risk thereof.  It’s HERE.

Today, I came across a tech ethics issue I hadn’t previously considered:  is it ethical for a lawyer to use a “crowdfunding platform” to solicit donations to fund the representation of  a client who cannot afford the lawyer’s fee?

The answer, according to the Philadelphia Bar Association, is “yes, as long as the lawyer complies with the rules.” The full text of the Philly advisory opinion is HERE.

I love the opinion.  Why?  Good question.  Let me tell you why.

You’d be surprised how often lawyers tell me “we need to change the rules to keep up with technology.”

No.  We.  Don’t.

Let’s use Rule 1.6 as an example.  Comment 16 tells us that:

  • “A lawyer must act competently to safeguard information relating to the representation of a client against inadvertent or unauthorized disclosure by the lawyer or other persons who are participating in the representation of the client or who are subject to the lawyer’ supervision.”

The rule does not reference technology.  In other words, the rule draws no distinction between the lawyer who is having a conversation with a person who is standing two feet away and a lawyer who is emailing a person who is 5000 miles away.

Advances in technology that have resulted in new methods of communicating & transmitting information have not changed a lawyer’s duty to safeguard client information that is communicated & transmitted. Are the risks associated with storing client information in the cloud different than those associated with talking with a client in a crowded hallway at the county courthouse?  Of course!  But the duty not to disclose otherwise protected information remains the same in each situation.

That’s why the Philly opinion is great.  It doesn’t treat “crowdfunding platforms” as new creatures that require new rules.  Rather, it reminds lawyers that the rules that apply when using a crowdfunding platform are the same rules that apply to any other representation.  That is, if a lawyer & client use crowdfunding to raise money  to cover the lawyer’s fee, the lawyer must:

Remember: advances in technology do not change the duties lawyers owe to client, courts, and third persons.

Some of you might be muttering “what’s a ‘crowdfunding platform’ ?”  If you want to learn more, or if you think they might help your clients, the wikipedia entry is HERE.  You’ve probably heard of GoFundMe and Kickstarter.  They are crowdfunding platforms.  For a list of the top 10 by traffic, go HERE.

Are you required to learn about crowdfunding?  No.  But, if a client asks about crowdfunding your fee, “i don’t know about that &  it’s probably not allowed” might not cut it.

Finally, as Margaret Barry of Vermont Law School has mentioned to me, advances in technology will improve access to justice.  That is the case with crowdfunding platforms. As the Philadelphia Bar Association noted, “[c]rowdfunding sites can be a beneficial source of funds allowing the public to assist in the assertion of valid legal claims that might otherwise go without recourse.” So, please, don’t succumb to the knee jerk reaction that if it’s new, it must be unethical.  There’s too much at stake for that thought process to prevail.

Crowdfunding

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6 thoughts on “Crowdfunding: The More Things Change….

  1. […] year, I praised an advisory ethics opinion in which the Phildaelpha Bar Association concluded that crowd funding litigation is not necessarily unethical.  Crowd funding is an alternative method of financing many things, including […]

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