Key considerations for attorneys with multistate practices

Recent decades have seen the rise of multijurisdictional practices as lawyers have taken advantage of new technologies to seamlessly provide services to virtually every corner of the globe. As businesses expand to different states or countries, they often benefit from having an attorney or law firm familiar with their business expand with them. Clients are often willing to look to other jurisdictions to find an attorney best suited for the representation, particularly where the matter may be highly specialized.

Although most attorneys understand the need to be admitted in the state in which they practice, or to seek pro hac vice admission for litigation matters in other states, a multistate practice can give rise to a number of other issues, particularly for those issues that are not germane to seeking admission before the bar. For example, in addition to the risk of the unauthorized practice of law, inconsistent ethics rules and jurisdictional laws can result in attorneys facing unexpected claims in unfamiliar jurisdictions.

Law firms and attorneys that practice or review the law in many jurisdictions may be forced to defend themselves in jurisdictions where they maintain no physical presence and further may be subject to ethics and malpractice laws that are distinct (and sometimes even contradictory) from those where the attorneys are physically located.

As reflected by recent decisions, that may happen even if an attorney never sets foot in the jurisdiction during the course of the representation. In Xie v. Sklover & Co., LLC, 260 F. Supp. 3d 30 (D.D.C. 2017), an employee in D.C. retained a New York employment law firm to represent her in connection with a dispute with her D.C.-based employer. The law firm had no office in D.C. and its partners were not admitted in D.C., nor did they travel there during the representation. After disputes arose between the client and her attorney, the client filed a malpractice suit in the U.S. District Court for the District of Columbia. The defendants moved to dismiss, arguing that the court lacked personal jurisdiction. The court rejected that motion, reasoning that because the partners had agreed to represent the client in a matter with a "substantial connection" to the district, there were equitable grounds for hearing the malpractice claims arising from that representation.

As a result, the law firm and attorneys in Xie were subject to D.C. jurisdiction based solely on their agreement to represent a client in connection with a matter in that jurisdiction. Attorneys thus would be well-served to understand the state of potentially applicable jurisdictional law to assess the possibility that they may be subject to the jurisdiction where their client is located. However, attorneys can take steps to address that risk while allowing a multistate practice to flourish.

Consider Applicable Law

In recent years, the U.S. Supreme Court has issued a number of decisions dictating the boundaries of personal jurisdiction. For example, in Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco Cty, 137 S. Ct. 1773 (2017), the court reiterated the principle that, in order for a state court to exercise specific personal jurisdiction, the suit must arise out of or relate to the defendant's contacts with the forum.

State courts addressing personal jurisdiction issues have taken varying approaches. The Supreme Court of Mississippi has held, for example, that a single act targeted at Mississippi is sufficient to confer specific personal jurisdiction if that act gives rise to the claim at issue. New York also exercises long-arm personal jurisdiction if there is a sufficient nexus between the defendant's contacts with the state and the legal dispute at issue.

Other states, such as Texas, apply different standards. For personal jurisdiction to be properly exercised against an out-of-state attorney in Texas, the defendant attorneys typically will need to have intended the harm at issue, or the court will likely conclude that the exercise of personal jurisdiction runs afoul of their due process. The Court of Appeals of Texas has explained that the foreseeability of the injury occurring in Texas and an impact on that state alone is insufficient to sustain personal jurisdiction. Further, that court has separately noted that the interests of the state of Texas in protecting its citizens against torts is not sufficient in and of itself to invoke personal jurisdiction against an out-of-state attorney who allegedly committed a tort outside of the state, even if that tort was intentional.

For attorneys with global practices, the uncertainty regarding personal jurisdiction could extend to other countries that have dramatically different legal systems. Thus, there may be even further complications when considering the potential forum for any disputes arising from a representation, as well as with respect to the applicable law.

Tips for Multistate Practices

The jurisdictional issues should not prevent attorneys from developing robust multistate practices. In most jurisdictions, an attorney is deemed to be practicing law in the jurisdiction in which they are located, reducing the risk of an allegation of unauthorized practice of law. Although most representations across jurisdictional lines are entirely proper, attorneys with practices that cross domestic and international borders can consider various options, out of an abundance of caution, to help avoid even meritless claims.

First, attorneys can associate with local counsel or directly employ attorneys licensed in the other state or jurisdiction. Second, if the law practice anticipates ongoing relationships with clients in the other state, it may be beneficial for attorneys at the firm to seek membership in that state's bar, which in certain cases may simply involve submitting a waiver application for admission.

Finally, law firms can consider excluding from the scope of the representation any reliance on state-specific facts or interpretation of another jurisdiction's law. Of course, law firms may need to consider whether such disclaimers undermine the overall value of their legal opinions.

When handling matters in different jurisdictions, attorneys are adept at considering how the law of the particular jurisdiction may impact their clients' interests. At the same time, attorneys should not forget that the law governing their representation may likewise vary. However, with careful consideration and planning, attorneys can build a strong national or international practice while minimizing associated risks. 