Federal judge gives green light to legal tech firm’s use of non-lawyers for legal advice
A legal tech company’s use of non-lawyers in a program helping New Yorkers facing debt lawsuits likely doesn’t violate state law’s unauthorized practice rules because it’s a protected speech, a federal judge ruled Tuesday.
Senior U.S. District Judge Paul A. Crotty of the Southern District of New York sided with tech company Upsolve, which had filed a preventive complaint in January against New York Attorney General Letitia James asking the court to allow him to move forward with a program called the American Justice Movement.
Upsolve said it created the program to expand access to justice and offer free advice to New Yorkers so they understand their rights and whether to respond to debt collection actions.
Upsolve is a non-profit association behind an app support for people facing bankruptcy. His First Amendment lawsuit claimed he risked prosecution if he used non-lawyers to help New Yorkers fill out a state-issued one-page form so they could avoid the default judgments.
Reverend John Udo-Okon, co-plaintiff and pastor of South Bronx, New York, whose congregants frequently come to him with their legal troubles, said he could face criminal charges or civil penalties for have offered legal advice in the program. .
But in his opinion and his order, Crotty issued a preliminary injunction for Upsolve, finding that the First Amendment likely protects the program as “content-based” speech.
“Furthermore, the balance of actions favors an injunction because the plaintiffs’ program would help mitigate an avalanche of unanswered debt collection cases while mitigating the risk of consumer or ethical harm,” Crotty wrote. in the 33-page decision.
Crotty added that Upsolve’s program is “carefully limited to out-of-court advice” and “will not threaten the overall regulatory exclusivity of the legal profession.” Therefore, for now, the program can continue without the threat of legal action.
In a statement, Rohan Pavuluri, CEO of Upsolve and 2019 ABA Journal Legal Rebel alongside company co-founder Jonathan Petts, said the lawsuit reflected a “central question” of whether the United States should be a countries where low-income people can access justice.
“We are grateful to the court for making this historic decision and what it means for the future of the American project,” Pavuluri said in a statement emailed to the Journal on Wednesday. “Yesterday’s decision is a big step toward fulfilling this fundamental American promise.”
James’ office did not immediately respond to a request for comment.
From 1993 to 2013, the amount of debt collection lawsuits more than doubled in the United States, from about 1.7 million to about 4 million, according to a 2020 article from the Pew Charitable Trusts. From 2010 to 2019, less than 10% of people were represented by a lawyer. Reviewing data where it was available, the article also noted that over the past decade, more than 70% of debt collection lawsuits ended in default judgments.
Upsolve did not seek a broader ruling that the state rules are unconstitutional.
Crotty noted that he narrowly judged that Upsolve was likely to succeed on the merits that the unauthorized rule of law practice infringes his rights to give legal advice under the Prime Minister’s free speech clause. amendment.