1. Federal Rule of Appellate Procedure 46 - Another area where out of state attorneys are allowed to compete within in-state attorneys is in federal appellate courts. Under FRAP 46, any attorney admitted to any state can be admitted to any federal appellate court. An appellate advocate from Guam can be admitted in the 2nd Circuit, but by local 2nd Circuit rule an attorney licensed by New York State who has not made 3 appellate arguments or argued 6 substantive state motions can't be admitted to the 2nd Circuit. Second Circuit Local Rule 46(e) provides a law student can appear for an indigent person if supervised by an attorney admitted to the 2nd Circuit bar. After graduation, but before bar results are received a former law student can appear before the Second Circuit, provided the student is sitting for any state bar within the 2nd Circuit. None of these rules have restrictions prohibiting attorneys not licensed in New York from arguing New York law.

Bottomline, attorney who have been examined for their competency in  New York law attorneys are not allowed to appear before the 2nd Circuit, but out-of-state law students with no experience with New York law can appear if they are representing indigent clients. At the same time experienced lawyers from anywhere in the United States can argue New York law before the 2nd Circuit.
 

1. Birbower, Montalbano, Condon & Frank, P.C. v. The Superior Court of Santa Clara County (Esq Business Services, Inc.)(Cal. 1998) - epitomizes the inherent contradictions in trying to apply geographical restrictions formulated in the 19th century when communications were carried by horses, to an age of telephones, faxes, email, extranets, FedEx and 777s. In this case Birbower, Montalbano, a New York law firm, was retained to handle a software dispute for Esq. Business Services (EBS), a company whose headquarters were in California. EBS for whatever reason, decided that they did not want to pay for Birbower, Montalbano's services and claimed that nothing was due Birbower, Montalbano, because the Birbower Montalbano attorneys were not licensed in California. The California Supreme Court AGREED. Birbower, Montalbano could not collect for the work done for EBS, while their attorney's were in California.

This decision is a major problem for the modern national law firms that have attorneys constantly jetting off all across the U.S to meet with their clients. (If you removed all of the attorneys from Monday morning flights out of LGA, LAX, SFO, ORD or DCA everyone else on the plane would have their choice of a window or aisle seat.) If California clients decide to use this decision to stiff their law firms several change will likely occur: (1) Californians will find their choice of firms restricted, (2) Other states will start retaliating against California attorneys visiting their states, and (3) Lawyers will encourage clients to travel to their out of state offices, rather than vice-versa. This last change will occur, because of the most curious part of the California Supreme Court's decision in Birbower Montalbano v. Esq. Business Services. The majority opinion held that Birbower, Montalbano firm, could recover for work done outside of California borders. It did not matter whether the work Birbower Montalbano did involved California law, it only matter where they were physically located when they were doing the work! As the dissent pointed out such destinctions make little sense in a world where the Internet has made geography irrelevant. With the use of readily available technology, lawyers can practice lots of California law, even appearing in the state through video-conferencing without every being physically present in California.

Lawyers are masters of working within in the rules to accomplish what they want and the issue of affiliation with non-lawyers is no exception. Some examples:

1. HalDor Investment Advisors L.P. - provides investment consulting services and includes lawyers from the large Boston firm of Hale & Dorr. Their website shares a domain name with the firm.
2. LeBoeuf Lamb Computing Technologies - provides a variety of legal/technology including the coming mega-litigations that will be associated with the Year 2000 software problems.

1. 22 NYCRR §1200.18 Forming a Partnership with a Non-Lawyer DR 3-103 - New York, like most states, prohibits attorneys from practicing law with non-lawyers, these same New York lawyers can form a partnership with lawyers not licensed to in New York State. New York lawyers can even ethically practice law, with attorneys licensed in Sweden, however, New York lawyers are not allowed to form partnerships with licensed patent agents, real estate brokers, divorce mediators or even form a professional relationship with an accountant, but they can share profits with non-lawyers in a retirement plan.

District of Columbia - Lawyers can partner with non-lawyers - The District of Columbia takes an approach much more in tune with the multi-faceted nature of modern business and non-commercial problems. DC acknowledges that the best way to provide client services may require the services of many professions and thus allows D.C. lawyers to form partnerships with non-lawyers. In DC, clients can received integrated services tailored to their problems from one firm. Non-lawyer professionals also need not feel like the hired the help. If their efforts improve and expand the firm they can be awarded with higher compensation and an equity interest in the firm. DC regulates these relationships closely. Combined professional firms, and particularly the lawyers in such firms, must be vigilant since DC R RPC Rule 5.4(b) provides that:

(1) The partnership or organization has as its sole purpose providing legal services to clients;

(2) All persons having such managerial authority or holding a financial interest undertake to abide by these Rules of Professional Conduct;

(3) The lawyers who have a financial interest or managerial authority or holding a financial interest undertake to be responsible for the nonlawyer participants to the same extent as if nonlawyer participants were lawyers under [DC R RPC] Rule 5.1;

(4) The foregoing conditions are set forth in writing.

1. In-house counsel - have traditionally been allowed to "associate" with non-lawyers and even participate in stock ownership and ESOP plans with non-lawyers. During the '80's the number of in-house counsel grew rapidly as corporations believed that it was cheaper to hire attorneys full time, rather than pay the same attorney's high hourly rate at a private firm. In the recession associated with the '86 tax act, many corporations cut all departments, including the newly expanded legal departments. In-house counsel's offices are once again expanding though not at the rate of the first big expansion.

Internet technology in the form of intranets is being exploited by many progressive legal departments at firms such as General Electric, Bell Atlantic and Mobil as well as high tech firms. Law firms have traditionally been late adopters of technology (some major firms still use DOS as their desktop operating system and early versions of Netware to run their LAN). It will be interesting to see how intranets effect business' preferences for in-house and outside counsel. Intranets can result in disintermediation, the elimination of human intermediaries, so attorneys who primary function is simply processing information, filling out forms based on a limited set of parameters, may well find that part of their job eliminated. Maximizing the usefulness of intranets requires intimate knowledge of the business, its processes and personnel which will result in the rise of the technology adept in-house attorney. At the same time private law firms and non-lawyers consultants will be able to develop sophisticated but more generic websites. Only a few law firms are presently promoting their intranet expertise, but you regularly hear of major law firms working with their large clients to develop sophisticated extranets. (Some of which have turned out to be vaporware on further investigation.)

2. Accounting firms - are probably the greatest single threat to major corporate law firms. The Big 6 (5 or 4) accounting firms generate revenues measured in billions of dollars, far beyond the largest law firms. In fact in comparision to the huge and almost fully consolidated accounting and consulting mega-firms, law firms look like a cottage industry. In countries, particularly European countries,without restrictions on lawyers partnering with accountants to practice law these mega-accounting firms are buying law firms. These same firms have disavowed acquiring law firms in the U.S., but in jurisdictions such as D.C. such an acquisition could look more and more enticing, particular in areas such as lobbying.

Accounting firms are also expanding their legal related services to corporations and law firms. For example prior to its merger with Price Waterhouse, Coopers & Lybrand described their Litigation and Claims Services on their website as follows:
 

The Litigation and Claims Services group help in the resolution of complex business disputes. Frequently, neither the law firm, in-house counsel, nor the client has the required specialties to address all the specific issues involved in obtaining favorable resolution. It is difficult for a law firm to maintain the staff with the depth and breadth of expertise to evaluate all the business aspects of each case. It is not easy for the client to stretch its resources to support the lawsuit while running the business. There is a need for the objective view of an unbiased expert.
 
The PricewaterhouseCoopers website now has a page on Dispute Analysis and Investigations, practically every one of the dozen areas listed are services that overlap with work done by lawyers and in some cases, appear to reach directly into areas traditionally done by lawyers as illustrated by their description of Antitrust services, which states: "We provide analyses of both liability and damages issues relating to competition, pricing, and benchmarks." Interestingly, the text that follows lists 8 different types of professionals that work together to provide these services, but does not mention their in-house attorneys.
3. Investment Banking firms - have traditionally competed with law firms in many transactional areas such as mergers and acquisitions, loan syndications, municipal and corporate financing and business consulting in these areas. As many of their traditional services are squeezed by the disintermediation caused by technological advances, you can expect additional efforts to expand the range od service capabilities.
4. Consultants - Traditionally a consultant was a corporate employee that was between jobs, the rise of the virtual corporation modeled on many of the software development projects in Silicon Valley have created a continuing need for consultants/independent contractors/temporary employees.  Microsoft employees a huge number of independent contractors (and has even lost a major HR case about benefits for their "independent contractors".) The corporate downsizings of the late 80's and early 90's unleashed a large number of people trained in the use of technology, many of whom created their own consulting business, an area that the U.S. Department of Labor has characterized as one of the fastest growing. A trend that DOL expects to continue. Many of the consultants served in quasi-legal positions as contract administrators, government liasons, regulatory affairs managers, tax accountants, environmental compliance officers, EEOC enforcement managers and other positions that deal with the mass of federal, state and local regulations and laws. These consultants, both within and outside the company,  are providing "guidance" on a variety of matters. Matters on which lawyers do or could provide "legal advice".
5. Other licensed professions - Consultants are not the only group that is using their knowledge of the law to provide guidance.  Every profession has individuals that deal with the legal aspects of their profession and provide services in legal situations, whether it be in litigation, contract negotiation or regulatory compliance. In the nursing field there is an entire emailing list on the topic of Legal Nurse Consulting.