A MATTER OF LAW: TEXAS vs. NOLO PRESS

Do-it-yourself legal publisher Nolo Press has built its reputation by sniping at attorneys. Founded in 1971, the Berkeley (Ca.) imprint -- whose titles include "Patent It Yourself" and "The Quick and Legal Will Book" -- even maintains 20 different categories of lawyer jokes on its Web site.

The State of Texas isn't snickering, though. Earlier this month, a state Supreme Court committee sent a letter to Nolo asking it to appear at a hearing on the unauthorized practice of law. At issue is whether Nolo's books and software -- some of which, as advertised, can create low-cost and binding wills, trusts, and incorporation papers -- effectively provide "imposter" legal advice in the same way as an unlicensed or disbarred attorney.

"The committee investigates if someone along the line has determined that Nolo might be doing something they shouldn't," says Jeffery A. Lehmann, a Houston lawyer on the Supreme Court committee, which is staffed by both Court-appointed and volunteer attorneys from across the state. If Nolo is found to be practicing law, it will not likely face criminal charges, Lehmann says. But a court injunction could pull some Nolo books and software from store shelves. It's unclear whether the state could prohibit or block the distribution of software and information posted on the company's Web site.

To even consider such steps, the committee must first prove that information in a book or software program constitutes the practice of law. Nolo Press contends that its 120 products are protected by the First Amendment, and that the investigation is motivated by lawyers intent on protecting their turf. Texas currently accounts for an estimated 10% of Nolo's total sales.

"People know the difference between paperback books and lawyers," contends Nolo publisher Ralph Warner, who helped found the company 27 years ago. "The First Amendment protects speech save in extremely limited circumstances, and it's ludicrous to say that because lawyers don't like this, they can ban it."

While Nolo and other self-help publishers have long attacked the stuffiness of the legal etablishment, courts have generally held that simple legal information and forms do not make unauthorized legal advice, says John Dzienkowski, a law professor at the University of Texas-Austin. "It's the First Amendment right of an author to write a book."

By contrast, he majority of unauthorized practice cases are made against untrained individuals posing as lawyers, most of whom offer low-cost divorces or legal protection for new immigrants.

For written materials, unauthorized practice standards are most likely to be applied only where such materials "might mislead people in a fundamental way," says Douglas Baird, dean of the University of Chicago Law School. "

In the state of Texas, however, Nolo has found an aggressive opponent. Through its unauthorized practice committee, the Texas Supreme Court has been one of the nation's toughest combatants against would-be lawyers. In mid-1997, it investigated a complaint against the accounting firm Arthur Andersen. The complaint alleged that Andersen's accountants and tax advisers were effectively serving as attorneys by consulting with clients on pending cases, even writing briefs submitted to courts.

In a 1992 action that could affect the Nolo Press investigation, the Texas committee obtained a court order against Vijay Fadia, a California businessman who sold 200 do-it-yourself will manuals at $24.95 each. The book was eventually banned on the grounds that it went "well beyond simple layman's advice." According to a Dallas County court decision: "The will manual contains 'fill-in-the-blank' forms and a 'create your own will' section. The selection of the proper legal form affects important legal rights."

The do-it-yourself nature of that book appears similar to Nolo Press' "Living Trust Maker," a software product cited specifically in a June, 1997, letter from the unauthorized practice committee to Nolo. Using Living Trust Maker, a customer answers a series of computer-prompted questions that help in preparation of a living trust, a legal document used to avoid probating a will.

Nolo's Warner says the Texas committee has no basis for investigating this particular product: "Living trusts aren't even filed anywhere. After you die, they're sent to a bank. Lawyers don't like living trusts because they avoid probate."

Yet in years to come, say professors Dzienkowski and Baird, increasingly sophisticated computer software -- which might use artificial intelligence to help draw up legal documents or dispense advice -- could increase the number of unauthorized practice claims.

"If not this battle, there's going to be a battle someday," says Baird. "The change of technology is going to put lawyers to the proof of whether they want to protect consumers or feather their own nests."

By Dennis Berman
Staff Reporter, Business Week Online