Law School 4.0: Are Law Schools Relevant to the Future of Law?

July 2, 2009

[posted by Bill Henderson, crossposted to ELS Blog]

Paul Lippe, a well-known Silicon Valley GC and founder of Legal OnRamp (LOR), recently posted an essay on the Am Law Dailythat essentially argues that law schools, at least in their presentform, are not relevant to the future of law. [Lipshaw recently opined on Lippe as well.] Here is Paul’s openinggraph:

If I need some insight into the future ofmedicine, I might head over to Stanford Medical School. If Iwanted to learn about likely directions in finance and hedge funds, Imight visit Penn’s Wharton. If I were looking to make investments incomputing, I might arrange a tour of a lab at MIT. If I decided tolearn something about where legal practice, law firms, and legaldepartments will be in 2014, where would I go? Not to law school.

Accordingto Paul, it is not that we are working on irrelevant stuff. It isworse than that: we are enjoying a comfortable living while loadingour students up with debt and having a low opinion of practicinglawyers and the clients they service. Paul recounts a recent meetingwith lawschool deans in which he “asked the question, ‘If you decided thepurpose of lawschool was to maximize the comfort and income of the faculty, whatwould you do differently?’ The answer: ‘Nothing.'”

Some people might be tempted to lump Lippe together with Judge Harry T. Edwards, who wrote several withering critiques of legal education during the early and mid-1990s. See, e.g., Harry T. Edwards, The Growing Disjunction Between Legal Education and the Legal Profession, 91 Mich L. Rev. 34 (1992); Harry T. Edwards, A Postscript, 91 Mich. L. Rev. 2191(1993). Such lumping together is a mistake. Edwards’ criticisms werelargely centered on the present–that professors where disengaging withdoctrine and increasingly irrelevant to judges and practicing lawyers.

In contrast, the gravamen of Lippe’s remarks are about thoughtleadership and the ability to identify future solutions to macro-levelproblems. Consider the following trend-lines, which arerepresentative of the types of issues that Lippe often discusses in hisLOR and Am Law Daily columns:

Nature and Cost of Civil litigation. With the proliferationof electronic documents, civil litigation is becoming moretime-consuming and expensive. Thus, disposition of cases isincreasingly influenced by the financial wherewithal to wage prolongedcampaigns in court rather than the merits of underlying disputes. Athought leader would be proposing (a) how to re-engineer the civiljustice in a way that reduces costs and improves access, or (b) how toanticipate and avoid legal disputes through systems that keep clientsout of a broken civil justice system.

Mediation andarbitration are just the beginning, not the end. For example, thecredit card industry has eliminated virtually lawyers fromconsumer-vendor disputes. See Morriss & Korosec, Private Dispute Resolution in the Card Context(working paper, June 2005). Some would argue that this is a good thingfor business and consumers. Further, the lawyers who innovate throughdesigning such a system will always get a prime seat at the table. Incontrast, lawyers wedded to established ways may find fewer buyers oftheir services.

Shifting Nature of Clients. Because of the shifting economics of the profession, an everlarge proportion of law graduates earn their living as “thing” lawyersrather than “people” lawyer. Believe it or not, in the 1930s, thedean of Yale Law School was preoccupied with the oversupply of lawyers.Why? Because the majority of Yale grads became generalpractitioners–i.e., people lawyers–within the local New Englandeconomy. See Charles E. Clark & Emma Corstvet, The Lawyer and the Public: An AALS Survey, 47 Yale L. J. 1272 (1938). That world no longer exists. The overwhelming majority of law school graduates willserve as “thing” lawyers, either for government, private industry, or apublic interest cause. Yet, hearkening back to the time of Dean Clark,our entire regulatory framework is premised on the idea of a client whois a single, natural person.

We lawyers claim to be responsive to economic and social forces and readily profess our commitment to the public interest. See Preamble, MPRC para. 6 (“Asa public citizen, a lawyer should seek improvement of the law, accessto the legal system, the administration of justice and the quality ofservice rendered by the legal profession. … A lawyer should aid thelegal profession in pursuing these objectives and should help the barregulate itself in the public interest.”). Yet, for nearly a century,the pace of regulatory reform for lawyers has been either glacial ornon-existent. And all-too-often, the changes that have occurred aredriven by “parochial or self-interested” motives. Id at para. 12.

Under Lippe’sthought-leader ideal, members of the legal academy would bere-conceptualizing the assumptions underneath lawyer regulation andproposing an institutionally coherent strategy for altering theregulatory landscape in a way that simultaneously helps ordinarycitizens,business, and the democratic process. In theory, we’ve got the time,resources, and brain power. Where is the leadership?

Cost and Quality of Legal Education. Over the last 30 years, the cost of a legal education has increasedapproximately three times faster than the average household incomes. Yet, it is difficult to identify a corresponding innovation withinlegal education that justifies the higher cost. A thought leaderconceives of ways to reduce the cost of legal education or equipgraduates with a larger skill set that is likely to provide asubstantial return on investment. Here, I am not talking MacCrate-typeskills, as important as they might be. Rather, I am thinkinglegal-process engineering and the ability to standardize andcommoditize legal products in a way that increases predictability anddrives down cost. See, e.g., Richard Susskind’s collected works.

Iflawyers solve problems, perhaps traditional legal disputes andtransactions are a mere subset of the services we might provide. What skills are especially relevant to the 21st century globaleconomy? Once again, because of our time, resources, and brain power,Lippe is surprised we are not leading the conversation. Maybe he has apoint.

More after the jump …

It istempting to write Lippe off as an arrogant Silicon Valley GC. But beforewe do, it is worth noting that Fred Krebs, president of the Associationof Corporate Counsel (ACC), wrote in a comment to Lippe’s essay that Paul was “Righton point. Should be required reading for law school faculty.” We canbe dismissive of Krebs as well, but the legal spend of his constituents(in-house legal departments) is the very thing that supports the highcost structure of legaleducation. If legal educators are uninterested in problems of peoplewho buy the majority of legal services, we should not be surprised whenin-house lawyers work very hard to reduce their reliance onU.S.-trained lawyers. Entrepreneurs in Europe, India, and LatinAmerica are salivating at the prospect of easier access to the U.S.corporate legal market. There is just no way that a state disciplinarycommission is going to use the unauthorized-practice-of-law hammer tochallenge how GE or DuPont allocates its legal spend–there is zeroconsumer protection basis for stopping the mass migration of this typeof legal work.

Frankly, amidst the meltdown of theentry-level lawyer job market, I am surprised by the lack ofsignificant interest or attention by legal academics, at least asjudged by blogosphere traffic. It is all-too-easy to assume that themarket will rebound next year, or 2011 at the latest. To this I mightask, “What is the basis for the optimism?” The salad days of 2004 to2008 were driven by a Wall Street juggernaut that destroyed the U.S.investment banking industry, which was the historical client basis forthe industry’s most prestigious law firms. And here is a more pointedfollow-up question, “How much does the legal economy need to recover sothat our students can to support their debt load?” See, e.g., JonathanGlater, Finding Debt a Bigger Hurdle than the Bar Exam,NY Times, July 1, 2009. Obviously, the answer to this questionrequires some careful study and some math. Vague appeals to thebusiness cycle just won’t cut it.

It is one thing to acknowledgethat we lack good answers–that part is forgivable. But it is quiteanother to ignore or minimize the problem because, quite frankly, itreally does not affect us personally. All of this reminds me of myyouth in Cleveland, Ohio during the 1970s and 80s. Lots of my friends’parents worked for General Motors, which offered high pay, amazingbenefits, predictable hours, and long vacations. No one else seemed tohave it so good. I remember thinking at the time that GM was bothcomplacent and invincible. It turned out that I was only half right. So I worry about my own industry. Do I have the mindset of a GMemployee circa 1979? God, I hope not.

Recently, the editors of Above-the Law surveyed the changes within the legal job market and asked two good questions: (1) if the Howrey/Drinker Biddle/Frost Brown Toddapprenticeship model gains traction, is it appropriate to shorten lawschool to two years? And (2) if law school salaries are going down,should law schools be expected to “share in the pain” by figuring outways to reduce tuition? Unless the job market significantly improvesduring the next 12 months, it is going to get much more difficult forus to ignore these issues. For a realistic cost analysis of the currentsystem, see Edward Rubin, Should Law Schools Support Faculty Research, 17 J. Comtemp. Leg. Issues 139 (2008).

Idon’twant this post to be a screed. I am looking for next steps that willproduce concrete and sustainable forward progress. But I have readenough history on the growth and evolution of U.S. legal education tohave a realistic view on institutional change. Here are my two primaryrules:

Rule #1: Great ideas are not enough. As a result, bold initiatives byprofessional organizations like the AALS or the ABA rarely have stayingpower. Law professors are intellectuals; hence, we fall in love withour own ideas. But all-to0-often, we fail to do a coherentinstitutional analysis that explains why others will adopt our ideas. Skipping this step is one of the privileges (and hazards) of the ivorytower. For a more elaborate discussion of this point, see Why I Worry About the Carnegie Report: Four Data Points (Dec. 7, 2007).

Rule #2: Sustainable ideas within any industry are always accompanied byinstitutional self-interest–legal education is no exception. In otherwords, the people who execute on the idea have to be made better off,e.g., through financial gains, professional reputation, leisure,economic security, or (at the individual level) self-actualization. This was secret sauce behind the Langdell case model: It was moreeffective than self-study yet it facilitated large enough class sizesto generate a perennial economic surplus. In turn,lawyers-turned-law-professors were freed from the commercial pressuresof practice and could advance their careers as experts. Theuniversity, professors, and students were all made better off. As asecond order effect, so was the legal profession. Of course, thisrevolution occurred 100 years ago. It is time for a new legaleducation formula that fits the 21st century.

Lippe understands this calculus. Indeed, he

ends his essay with a “glass is half-full” perspective that is bound to be overlooked:

While lawschools need to figure out how to get graduates out the door faster andfor less money, they also are the logical source … of skills(as well as reputation and network) development for lawyers to becomefully functional, especially as firms’ appetite for subsidizingtraining will decline. Medical schools and business schools make a tonof money at continuing/executive education, so this is a greatopportunity to enrich the faculty and student experience, generate anincome stream, and engender more alumni loyalty.

Inother words, innovation starts at home with a law school business modelthat pays the freight by delivering financial and reputational benefitsto stakeholders. And if our metric is 20 slots in US News, weare setting the bar too low. This type of innovation creates anentirely new system of merit. To my mind, Lippe’s Law School 4.0 is aworthwhile and achievable goal. Theonly downside is that we have to fully engage in the problems of themodern legal profession and be willing to fall flat on our faces. Sounds interesting. Sign me up.

Posted in:

The Practice