Upsolve uses First Amendment to deal a modest but important blow to UPL. Is it the basis for a playbook? Time will tell.
Earlier this week, a federal district court in New York granted an injunction in favor of Upsolve, Inc., a nonprofit legal technology company founded by Rohan Pavuluri, a public interest entrepreneur who cut his teeth in Harvard Law’s A2J Lab, and Rev. John Udo-Okon, a pastor from the South Bronx. Both Pavuluri and Udo-Okon both were interested in providing free legal advice to individuals facing debt collection actions. See Upsolve Inc. v. James, No. 22-cv-627 (SDNY, May 24, 2022).
The predicaments faced by many New Yorkers are fairly typical of those faced but so many individuals, whether indigent or low-income by typical measures, throughout the United States — they simply cannot afford lawyers to assist them with their pressing legal problems. They are the faces of the profound access to justice crisis in the United States, putting them at omnipresent risk of losing their livelihoods, their homes, or even worse fates. Through a carefully designed initiative called the American Justice Movement, Upsolve and Rev. Udo-Okon would train a group of “justice advocates” to give targeted, limited legal advice to individuals facing debt collections.
First Amendment versus UPL
The Upsolve litigation involved a novel legal theory, one that came in essentially two parts. The First Amendment of the Constitution protects the right of free speech and association, and the status of these rights as fundamental obliges the government to come up with a compelling state interest before it can restrict these rights. Further, the government must make the case that these restrictions are narrowly tailored to accomplish these interests. In this case, the position of the plaintiffs was that the limitation of legal advice to lawyers, as is clear under New York statutes governing the so-called unauthorized practice of law (“UPL”), impinged on the plaintiffs’ right to associate in order to fulfill their objectives (think, as a ready analogy, the situation of employees joining labor unions or individuals joining the NAACP) and, moreover, impinged on the ability of these individuals to express their views through the advice given to needy individuals.
That the federal courts had seldom considered the question of how UPL laws unconstitutionally restrict nonlawyers’ ability to render legal advice is not altogether surprising. UPL laws are ubiquitous and ancient. The deal is that lawyers provide legal services and nonlawyers stay out of this domain. No principle has been more fundamental to the lawyers’ regulatory guild. In the rare instances in which disputes have arisen, federal and state courts have reinforced the point that restraints on non-lawyer legal advice and representation are important to protect, for they ensure that individuals will have quality representation from uniquely skilled and specially-trained individuals. And occasionally the courts (along with commentators, usually themselves lawyers and law professors) will ground this sacrosanct principle in the imperative of securing the rule of law. Who better to protect the rule of law than lawyers?
And yet much of this classic analysis is ipse dixit. It makes sense only as a self-referential encomium to the distinct value of lawyers in providing representation and advice, arguably because of their training and their legal obligations as officers of the court. The skills lawyers develop and sharpen through their work, beginning with law school and continuing in their professional roles, is not in dispute anymore than it is disputable that certain health issues demand a physician and not another kind of health professional.
However, at the heart of the claim for stringent UPL regulations is that there cannot be an area of civil justice in which circumstances warrant creative solutions to address needs otherwise unmet. Again, the medical analogy is apt. Many health situations can and should be addressed by individuals who are not licensed physicians. Indeed, we could scarcely imagine the health consequences of a regime in which anything involving health and medicine is scrupulously restricted to physicians. See, e.g., Post 275 (documenting the varied roles and credentials of healthcare providers, noting that less than 10% have MD or DO degrees); Post 140 (same). If there was ever an era in our history in which these restrictions were animate, there are long past and obviously anachronistic.
With lawyers, however, the lines drawn between who may provide legal services and who may not have been persistent. The Upsolve litigation is one piece in what is a steadily increasing attack on this citadel of exclusion, on this guild. Building upon a plethora of data illuminating the breadth and scope of the A2J crisis, the claim here is that UPL restrictions, such as those in New York, cannot meet the needs and demands of our more vulnerable citizens. Legislative efforts, regulatory sandboxes, and judicial adaptations are flourishing and we are in a moment in which major changes in the way legal services are regulated are changing. Intriguingly, the Upsolve lawsuit represents the use of a very different weapon in this battle: American constitutional law.
Two First Amendment theories
Per the court’s opinion, “Plaintiffs advance two theories under the First Amendment. First, they claim the UPL rules infringe on their right to associate with potential clients and access the courts. Second, they claim the UPL rules infringe on their right to give legal advice under the Free Speech Clause.” Id at 13.
1. Right of Association
The court considered carefully and rejected the first of the plaintiffs’ two legal arguments. Judge Paul Crotty saw the lodestar Supreme Court cases, one involving the NAACP and the other the ACLU, as standing for an ultimately narrow proposition, and that is that “[t]he lawyers in those non-profit cases sought to vindicate constitutional rights, such as equal protection against discriminatory laws, because such causes ‘implicate[d] expressive values’ for both the lawyers and their clients. Upsolve, at 16 (quoting from Jacoby & Meyers, LLP v. Presiding Justices of the First, Second, Third & Fourth Departments, 852 F.3d 178, 185-86 (2d Cir. 2017)). The emphasis is on lawyers’ associational rights and so it would not cover, says the court, efforts by “nonlawyers” to engage with clients, for it is the clients’ expressive rights that are being furthered by this association between the justice advocates and the individuals with legal needs.
This narrow reading is ultimately too narrow, in that it reads the classic association rights cases, NAACP v. Button, 371 U.S. 415 (1963) and In re Primus, 436 U.S. 412 (1978), as turning on the associational interests of the lawyers qua lawyers. This is rather peculiar, given that the overall effort in all of these matters, including the American Justice Movement at issue in the Upsolve litigation, is to advance the welfare of these clients and enable them to vindicate their interests in court. But this argument will need to live for another day, as the court concludes that the plaintiffs are unlikely to succeed on the merits of this claim.
2. Free Speech
The second claim proved more persuasive to the court and this free speech claim is the underpinning of the court’s holding in favor of Upsolve and Rev. Udo-Okon.
The court took us through the distinction between protected “conduct” and protected “speech” of a more traditional sort, the former deserving only intermediate scrutiny and the latter being subject to the strictest of scrutiny. What’s the key difference between the two? Insofar as the regulation is (as it clearly is here) content-based, this is at the core of what the First Amendment protects. Here, the justice advocates were designed to give “pure verbal speech,” and we’re not arguing that they should be able to engage in conduct that would more sensibly be construed as legal practice.
Judge Crotty takes from a not especially prominent Supreme Court case from a dozen years ago, Holder v. Humanitarian Case, 561 U.S. 1, 14–16 (2010) the basic framework within which to consider the application of this New York UPL law on these plaintiffs. “The Humanitarian Law Court set forth the following rule: for as-applied challenges, courts ask whether plaintiffs’ own speech is directly or incidentally burdened, not whether the statute on its face imposes an incidental burden on speech.” Upsolve, at 20. The key point, the court here says, is that the plaintiffs are being punished because of the message they are communicating. Although an ideological statement or the expression of any particular opinion, the communicative message is the legal advice they are giving to their clients. UPL laws, as the court notes, are “speaker based,” id. at 22, that is, they are restrictions on non-lawyers as a class; moreover, these laws “focus on whether the [speaker] is speaking about a particular topic.” Id. (quoting from Barr v. Am. Ass’n of Pol. Consultants, Inc., 140 S. Ct. 2335, 2347 (2020)). These are classically content-based restrictions upon speech and are subject to strict scrutiny.
The court then turns to the question whether the fact that these UPL restrictions as applied to the two plaintiffs are part of a comprehensive licensing regime creates a sort of governmental safe harbor from which close interrogation of the restriction would be unwarranted.
There is one concurring opinion from Justice Byron White in Lowe v. SEC, 472 U.S. 181 (1985) that supports this safe harbor theory. Justice White says in Lowe that “the government can “enact generally applicable licensing provisions limiting the class of persons who may practice the profession” without infringing on anyone’s freedom of speech.” Id. at 232 (White, J., concurring). Ultimately, the court in Upsolve finds this theory unsatisfactory, rejecting cases from outside the 2nd Circuit that involve lawyers and legal regulation and making the strong claim that legal advice, by contrast to other forms of specialized knowledge and advice whose origins go all the way back to the Founding, “lacks that clear history of regulation” and, therefore, “[w]ithout an established historical basis to do so, courts today cannot treat pure legal advice as a sui generis category of speech that is immune to constitutional scrutiny.” Upsolve at 26.
Applying strict scrutiny to this content-based regulation, the court views the traditionally strong justifications for UPL rules as “less compelling in the context of Plaintiffs’ specific, narrow mission.” Id. at 27. The court bats away the various arguments that this scheme of justice advocates will not address adequately the problems of debt collection, noting that it is not a failure of the project that it does not, solve any and all problems. Furthermore, the law is so broad-ranging that it is not narrowly tailored, as the Constitution demands, to the problem identified.
Interestingly, Judge Crotty notes, with the benefit of an amicus curiae brief by leading access to justice scholar-advocate Rebecca Sandefur, that there are various reforms underway in states that illustrate how an evidence-based, carefully constructed system for providing legal advice (and even representation) by allied professionals who are not lawyers could accomplish the aims stated as important by New York and its various amici supporters.
Something new and important
The Upsolve decision by this federal trial court is an important victory, for those in need of legal help in debt collection matters in New York state, and also symbolically for the access to justice movement.
To focus on the latter issue, this is the single most consequential legal holding supporting a First amendment claim against UPL restrictions. There is dicta in various cases and many law review articles, but until Upsolve v. James, no court had gone so far as to invalidate, albeit here only as an as-applied challenge, a key element of modern UPL restrictions on the provision of legal advice by nonlawyers. Moreover, given the groundswell of reforms in various states, Utah and Arizona most notably at present, this case comes along at an auspicious time. Imprinted on this decision, and the presumably continuing litigation if New York decides to appeal this decision or similar lawsuits are brought in other jurisdictions, is the hard work by many access-to-justice warriors. This is a cogent example of impact litigation and how legal strategy can be formulated to advance important social causes through discrete, yet meaningful, steps.
But also limited in scope
At the same time, the Upsolve decision is narrow and equivocal in a number of respects. There is caution at various places and junctures in the court’s opinion, and we should acknowledge the limits of the decision. I will describe these cautionary elements, and then conclude on a note of optimism and hope.
First, Judge Crotty’s opinion stresses that this lawsuit is just an as-applied challenge. Therefore, it does not strike down on facial grounds any of New York’s UPL restrictions. There could be many projects in which nonprofit organizations and other individuals who are not lawyers seek to provide legal advice and limited purpose representation that would run afoul of this UPL law and would not be inconsistent with anything the court says in its decision in Upsolve. The basic logic of the constitutional argument against UPL restrictions on legal advice by nonlawyers is that they are intrinsically content-based restrictions precisely because they distinguish between two types of speakers, those with a valid attorney credential and those without.
While it is not clear exactly how the court would distinguish other individuals or groups who are furnishing legal advice to needy clients from these two plaintiffs, Upsolve and Rev. Udo-Okon, the court emphasizes that, in any event, this is decidedly not a facial challenge. This is congruent with the legal strategy of the plaintiffs, but it is worth noting that UPL regulations can be attacked, in the absence of a facial challenge, on a case-by-case basis. We should not underestimate this burden, especially given that not all such projects will have the enormously important support of Mr. Pavuluri as the benefactor and impresario of these litigation efforts.
Second, as already described above, the rejection of the right to association claim is an unfortunate setback in this impact litigation. The line drawn between advocacy on behalf of clients undertaken by lawyers (as in the myriad cases decided by the Court over the last several decades) and those undertaken by individuals who are not lawyers is an unstable one. Thus, Judge Crotty’s decision is disappointing in its rather summary rejection of this line of cases, cases that may well support an associational claim that could chop away considerably on UPL restrictions. It is not inconceivable that such a claim could find its way up to the Supreme Court, given the separate issue that continues to percolate in discussions of guild regulations, that is, whether the Court’s decisions in Janus v. AFSCME, 138 S. Ct. 2448 (2018) and North Carolina State Bd of Dental Examiners v. FTC, 574 U.S. 494 (2015), neither of which bear specifically on the First Amendment issues in the Upsolve litigation to be sure, might undergird an omnibus legal strategy to challenge lawyers’ monopoly over legal service provisions.
Third and finally, the court is scrupulous in drawing a distinction between conduct in the form of direct provision of legal services and conduct that is about communicating a message — as Judge Crotty puts it, “pure verbal speech.” The court makes this distinction explicitly when it notes: “[M]any UPL cases have focused on specific ‘conduct’ that non-lawyers sought to undertake. Non-lawyers have been excluded from ‘drafting’ pleadings and “filing” legal documents. Conduct could also include ‘representing’ clients in a courtroom or proceeding. These conduct-focused cases are inapposite, as Plaintiffs do not seek to do any of these activities.” Upsolve at 18 (citations and footnotes omitted).
But this distinction, in both theory and practice, is ultimately untenable. Providing legal advice in myriad forms is clearly, as both parties acknowledge in this case, the unauthorized practice of law under relevant New York law. Why would the narrowness of this particular rendering of advice — i.e., giving clients advice about how to fill out forms — demarcate a meaningful distinction between acceptable restrictions on legal practice by nonlawyers and those which are unacceptable under state law?
It should not be a surprise that the good judge wants to limit the scope of the decision, as accepting the porousness of the line between relatively minor advice and actual representation (if not necessarily in civil court, then in all other relevant settings in which a client is being informed and counseled) does represent a full-bore threat to the entire scheme of UPL regulation. But, then again, the access-to-justice warriors whose efforts underlay the legal strategy at work in the Upsolve litigation are willing to take this all the way down this slippery slope. We should be reminded here that the UK lacks a regime of UPL, even though it regulates in various ways the actions of activities of lawyers and other advocates. See Post 106 (discussing UK regime in which certain “reserved” legal services can only be performed by licensed lawyers). And so courts should continue to be reminded that licensing of lawyers through the traditional methods and the correlative prohibitions against UPL are not part of any sort of state of nature. They are neither inevitable nor, for reasons associated with the worsening access to justice crisis, warranted.
A note of hope
Having dwelled on what the court did not do, it is worth closing on a note of hope.
This case represents a major move forward — perhaps even a leap. In conversations involving this lawsuit (in which I and many others took part), one question was whether the state of New York would bother to defend this UPL law against this as-applied challenge. All they had to do to make this case go away is to assure the court, under direct questioning, that it would not prosecute Upsolve and Rev. Udo-Okon for providing this very limited advice to these individuals facing debt collection. But they declined to do. See Upsolve, at 8-9 & note 4 (quoting oral argument and thus concluding that “[t]he Attorney General has not rebutted the presumption of enforcement”).
It appears that the position of New York, and perhaps other attorneys general in other states, is that their UPL restrictions must be defended against efforts to chip away at the regulatory edifice. This defiance, if I am correct in this prediction, presents an opportunity. Lawyers should look for states where such challenges are potentially viable. This could, as with the Upsolve litigation, involve principally federal constitutional challenges under the First Amendment, but it might include claims based upon other federal laws (equal protection, due process, antitrust laws, and perhaps others I am missing here) and also claims under state constitutions, the latter of which is often a neglected area of potential legal challenges.
On a related note, the impact of the Upsolve suit, assuming that it is not reversed on appeal, could be consequential for state-level reform efforts, in much the same way that legal movements in the United States usually involve an admixture of litigation, statutory change, and administrative regulation. For those of us who thought that litigation would be the weakest part of this strategy, see Post 240 (me noting at least the possibility of constitutional challenges that might break up the logjam of bar federalism), especially given that the audience for these arguments are lawyers sitting in judgment as judges. After all, the Upsolve case suggests that a more hopeful future for access-to-justice reform and guild-busting may be just around the corner.