More on the Red Flags Rule

The Law Journal has recently picked up on this very important issue. See Daniel Wise's article "FTC Rule on Identity Theft Draws Strong Criticism From Bar Groups" from July 01, 2009. He writes "The New York State Bar Association Monday became the latest bar group to protest new Federal Trade Commission rules requiring lawyers to become involved in preventing identity theft . . . . The state bar's objections follow those submitted last week by the American Bar Association and the New York County Lawyers' Association.


The article also mentions our blog (thanks, Daniel): "The New York County Lawyers' has set up a platform on its Web site . . . where its more than 10,000 lawyers [as well as other members of the legal community] can vote on whether they support or oppose the FTC rule." So, step up and vote, we want to hear from more of our 10,000 NYCLA members and from other members of the legal community who happen to be surfing the site.

Should the FTC regulate your firm?

In order to combat identity theft, the Federal Trade Commission issued regulations requiring, inter alia, financial institutions and creditors to develop and implement "written identity theft programs," as part of the Fair and Accurate Credit Transactions Act of 2003. In April 2009, the FTC informed the American Bar Association that it intends to require lawyers and law firms to abide by the rules because lawyers and law firms fall into the category of creditors under the law.

The "written identity theft programs" must provide for the identification, detection, and response to patterns, practices or specific activities that could indicate identity theft. The programs must describe responses that a firm would undertake to mitigate or prevent identity theft, and require management by senior employees of the firm.

Compliance with the FTC rules would undoubtedly be burdensome in time and expense for the legal community. In addition, the FTC rules threatens the autonomy of the legal profession, which is the only service provider that remains self-regulated and nearly free from federal oversight. But perhaps compliance with the FTC rules is a fair price for firms to pay to ensure the safety of their client's identity (bearing in mind that there have been no reported instances of identity theft arising from providing legal services).

In less than two months the Federal Trade Commission's "Red Flags Rule" will go into effect, which may mean yet more regulation of your law firm. NYCLA wants to know your opinion as to whether or not to endorse the "Red Flags Rule" regulations and get your views on a course of action to address the issue.

Please leave your comment by clicking the "Comment" link below.

Good bye lunch expense account

Our last survey tried gauge how the economy is affecting one of the perks of large law firms--the summer associate lunch. It appears the belt-tightening continues at most big firms even though many (at least those with strong litigation practices) assert that their business is healthy. Well, not healthy enough to reinstate last year's summer lunch policy. Seventy-seven percent of our voters say that their firms imposed sever cut backs to their firms summer lunch policy. The rest of the voters were split between (1) new spending limits, or (2) no change at all.

We will have to see if this is an overall change in the culture of recruitment at big law or if it is merely a anomaly formed from caution and fear.

I'd Like a Reply Memo in a Size 8, Please

For those of you who dream of an idyllic world without billables think of private practice's extreme alternatives. Here is one example from the ABA: How Law Practice Will Become Like Off-the-Rack Suits. Read the complete article at:http://www.abajournal.com/news/how_law_practice_will_become_like_off-the-rack_suits/

The Fall of the Billable Hour Paradigm?

You have voted on the future of the billable hour: most of you want to do away with the billable hour by focussing on alternatives (62%); many of you continue believe in the utility of the billable hour and want the profession to stick with it (25%); and only a small minority despise the billable hour enough to want to "kill it" (12%).

Don't forget to vote on our new survey on the right side of the screen -- has your firm's summer lunch policy changed?

Mentoring Back on the Agenda

Rumor has it that the NYCLA Task Force on Professionalism is in the early stages of developing a mentoring program. The Task Force's efforts have identified a serious need for mentoring to advance professionalism and satisfaction among lawyers. We will keep you updated as we receive more information.

My Least Favorite Topic: Layoffs

Below are links to two compelling articles that discuss very different aspects of the effects of the waves of lay-offs that we have been experiencing in our industry.



The first discusses lawyers (mostly young lawyers) who are "adrift" and "lost." In "Laid-off Lawyer's Find Themselves Adrift" from the National Law Journal, Leigh Jones highlights young, high-achievers who lost self esteem, hope, and direction after being laid-off at: http://www.law.com/jsp/nlj/PubArticleNLJ.jsp?id=1202428827679. The article ends in optimism and I hope anyone affected by these lay-offs is able to pull up their socks and find something new and better. NYCLA and other local bar associations are making special efforts to assist people who are laid-off. Those are the first places I would look into; they provide great resources.



The second article, from the ABA Journal, entitled "Layoff ‘Herd Mentality’ Ignores Greater Savings of Pay Cuts, Prof Says" discusses how firms may have other options to stabilize their finances instead of lay-offs, but are not exploring those and instead are opting for what everyone else is doing. Hopefully, firms are not finding that lay-offs are easy fix of their balance because it has become an acceptable consequence of the recession. Read the complete article at:http://www.abajournal.com/news/layoff_herd_mentality_ignores_greater_savings_of_pay_cuts_prof_says/