Washington Weighs Loosening Rules on Who Can Practice Law

The state of Washington wants to run an experiment: Relax restrictions on who can practice law, and measure whether people have an easier time accessing legal services as a result.

Like most states, Washington currently mandates that legal services can only be offered by attorneys, and law firms must be owned by lawyers. Under a pilot proposed by the state’s bar association and law practice board, Washington would ease those restrictions for select entities providing legal services online or through non-traditional business models. It also would collect data to help it decide whether to make the changes permanent.

Washington would follow a handful of states experimenting with looser practice-of-law rules to try to expand access to legal services. Advocates of such initiatives are hopeful they can increase access to justice, while critics warn that outside influence could compromise lawyers’ professional independence.

Utah launched a regulatory sandbox in 2020, allowing entities that wouldn’t otherwise be permitted to practice law to apply for the program and operate with oversight from the state. Arizona in 2020 removed restrictions on non-lawyer ownership of law firms.

“The United States has one of the most restrictive regulations of legal services in the world,” said Lucy Ricca, executive director of Stanford’s Rhode Center on the Legal Profession. Ricca was also the first executive director of Utah’s regulatory sandbox, a model for the Washington pilot.

Those restrictions include a very broad definition of what it means to practice law; a small, expensively educated group of people who do it; and a model of providing services that’s changed little in the last century, she said. “It’s just not working anymore.”

The Washington State Bar Association and the state’s Practice of Law Board released a draft version of an order last week, and are collecting public feedback ahead of a September 6-7 meeting. They expect to finalize and submit the order to the state Supreme Court for approval by the end of September, they said.

Work on the pilot has been underway for more than four years and has seen multiple drafts of the proposal, said Craig Shank, a member of the Practice of Law Board.

“This is the beginning of a process, not the end,” Shank said. “The goal is to learn more and make transparent, data-driven decisions before any permanent regulatory reform is put in place.”

‘Data-Driven’

Architects of the pilot emphasized a data-driven approach, seeking to measure the harms and benefits of the entity regulation project before making anything permanent.

Shank said they’re looking at whether the changes increase access to justice through affordable and reliable legal services, as well as consumer harms, regulatory challenges, or other risks.

Each entity applying for a spot in the pilot is required to propose “a specific hypothesis relating to reforming one or more regulatory rules governing entities practicing law and, if applicable, other related rules,” and “a study to test that reform,” Shank said.

The pilot would run until its administrators have two years’ worth of data on the most recently admitted entity. The POLB doesn’t have an estimate for how many entities would likely apply or be admitted, because the process is still in early stages, Shank said.

Utah’s Office of Legal Services Innovation, which administers that state’s sandbox, doesn’t measure benefits but does track reported complaints about any of the entities in the program, Ricca said.

Benefits and Risks

Proponents say such regulatory changes could help drive down the cost of legal services and make them more easily available.

For example, loosening the rules could allow a lawyer to accept investments or partner with a technologist to automate a legal service, said Andrew Perlman, dean of Suffolk University Law School. Someone with technical expertise may be expensive to hire, and current rules wouldn’t allow a non-lawyer to split the fees in a partner model.

Regulatory sandboxes target areas involving consumers, Perlman said—like family law, contract disputes between individuals, immigration, debt, and foreclosure.

Similar efforts to loosen restrictions have failed in places like California, over strong pushback.

One of the main risks is that the profession’s independence could be compromised, said Stephen Younger, senior counsel at Withersworldwide, who has written about the argument against regulatory changes. For example, a law firm with non-lawyer ownership could be motivated to push a client to settle a case to get revenue for the firm sooner, even if it was in the client’s best interest to wait for a trial.

Such concerns should be addressed by regulating to protect against harms, said Ricca, rather than stopping the changes.

Washington will require each applicant to the pilot program to identify a compliance officer, who will be tasked with making sure the entity follows the state’s laws and professional conduct rules, Shank said.

Younger pointed to technology as a better alternative to opening up law firm ownership—for example, an automated tool that helped someone fighting an eviction file the appropriate forms. Such a tool would not violate unauthorized practice of law rules, he said.

The Washington Bar’s Practice of Law Board said it’s inevitable that people will increasingly turn to technology for their legal questions.

“The provision of these services is already being delivered to the public” without regulation, “and is sure to expand in coming years,” it said.

But technology—particularly generative AI—also carries risks, particularly when there’s no human lawyer verifying answers to catch an error.

If people will turn to tools like AI in an unregulated environment regardless, the public would benefit from the state regulating them—strengthening the argument for a regulatory sandbox, Perlman said.