IN REGARDS TO THE TWO CASES PROVIDED BELOW, For this assignment, please draft on the following topic:

UNAUTHORIZED PRACTICE OF LAW ( UPL) and the practical applications of UPL in the real world

The goal is to discuss how UPL can occur in the real world, and what happens when this occurs. Please include the discussion of the two cases provided below. For instance, you should reference the facts, legal issue and outcome from at least two of the cases provided below.

Likewise, you will address the following questions:

What is the distinction between UPL and ethical paralegal work?

How can an attorney be responsible the paralegal's UPL?

How can UPL occur in a law office?

How can UPL occur in a non-law office setting, such as a real estate company or healthcare setting?

CASE ONE:

People v. Landlords Professional Services (1989)

Annotate this Case

[No. D009858. Court of Appeals of California, Fourth Appellate District, Division One. November 28, 1989.]

THE PEOPLE, Plaintiff and Repondent, v. LANDLORDS PROFESSIONAL SERVICES, Defendant and Appellant

(Opinion by Benke, J., with Work, Acting P. J., and Todd, J., concurring.) [215 Cal. App. 3d 1600]

COUNSEL

W. Dozorsky for Defendant and Appellant.

Cecil Hicks, District Attorney, Michael R. Capizzi and Maurice L. Evans, Assistant District Attorneys, Thomas M. Goethals and Theodore A. Johnson, Deputy District Attorneys, for Plaintiff and Respondent.

OPINION

BENKE, J.

In this case we consider whether the eviction service provided by Landlords Professional Services (LPS) involved the unauthorized practice of law.

I Facts and Procedural History

In 1982 the Orange County Apartment News carried an advertisement for the eviction services provided by LPS. The ad stated "Evictions as low as $65" and showed the picture of a purposeful and authoritative looking man, arms folded across his chest, stating: "One low price $65 plus costs uncontested or contested in pro per. Attorney for trial extra if needed." Below the picture were the words "Time to Act!" and "Call & talk to us." The advertisement ended with an address and telephone number.

In 1982 Roberta Spiegel decided to evict the tenants of an apartment she owned. A friend recommended LPS. Roberta spoke to bill Watts, an [215 Cal. App. 3d 1602] employee of LPS, who told her to come to the LPS office and bring all documentation related to the rental. On arrival Roberta was given a booklet with Mr. Watts's business card attached. The card was imprinted with the words "Landlord's Professional Services" and the name Bill Watts. Beneath Mr. Watts's name was the word "Counselor."

The booklet begins with a chronology of an unlawful detainer action as carried out by the eviction service. The chronology was generally factual. However, at the end of the chronology, this bit of advice is imparted concerning what after the tenants have been evicted: "You must change the locks at that time. If you do not change the locks you may have a problem. The defendant may re-enter and take possession, and the ball game starts from the beginning."

The following pages of the booklet contain examples of the types of forms used in an unlawful detainer action and provides a guide for how those forms should be completed. Often the guidance is purely factual, i.e., where a form requires the name of the city in which the subject property is located the guide states "enter city." The advice given, however, can be more useful. In discussing the "Notice to Pay Rent or Quit," for example, the guide states: "Acceptance of any money after service may void notice. You don't have to accept money after notice expires."

Bill Watts reviewed the normal routine in an unlawful detainer action with Roberta who was unfamiliar with eviction procedures. Roberta asked questions about the procedure and Bill answered them. Roberta told Bill she had already mailed the tenants a three-day notice. Bill told her this was insufficient and she would have to take another notice to the apartment. Bill asked Roberta questions and completed the documents and forms necessary for the unlawful detainer action and eventually filed them.

On December 7, 1982, Ralph Lopes, an investigator with the Orange County District Attorney's Office, called LPS and stated he was a property owner who was interested in eviction services. Lopes stated he was unfamiliar with the eviction process. The procedure for commencing and carrying through an unlawful detainer action was explained by Jacqueline Sutake, an LPS employee. Sutake explained Lopes would have to send LPS all documentation concerning the rental and they would handle the process. Lopes asked what it meant in the LPS ad when it stated "pro per." Sutake explained LPS was not an attorney and Lopes would be representing himself. Sutake stated LPS could not represent him in court. If an answer was filed by the tenant, LPS would type up Lopes's testimony and he could read it in court. Lopes asked if he would need an attorney. Sutake stated if an answer [215 Cal. App. 3d 1603] is filed by an attorney, LPS recommends its client obtain one as well but that it is possible to prevail without the assistance of counsel.

Lopes asked if he could turn off the utilities at the rental property. Sutake stated he could not. Lopes asked what would occur if he needed an attorney during the process. Sutake stated he could use his own attorney or "we have attorneys here."

Ms. Sutake testified she did not advise her clients on questions of law. She did, however, explain the unlawful detainer procedure and would share with clients her personal experiences as a landlord. If the case presented was more complex than the routine uncontested unlawful detainer action, she would suggest the client contact an attorney. Ms. Sutake explained her activities were always supervised by an attorney. When an unfamiliar situation arose she would ask an attorney for help and the attorney would determine if the complexity of the case required the services of a lawyer. In most cases her work was reviewed by an attorney before being filed.

In February 1983, the Orange County District Attorney filed a civil complaint against LPS and five other eviction services, alleging the unauthorized practice of law. (Bus. & Prof. Code, 6125, 6126.) The complaint sought monetary penalties pursuant to Business and Professions Code sections 17200 (unfair competition) and 17500 (false or misleading statements) and injunctive relief. At the conclusion of the hearing below the trial court ordered LPS to pay $8,000 in civil penalties for eight violations of Business and Professions Code section 17200 and $9,000 for nine violations of Business and Professions Code section 17500. The finding of eight violations of section 17200 was based on evidence concerning services provided by LPS to seven clients, including Ms. Spiegel, and on the telephone conversation between Ms. Sutake and Investigator Lopes. The finding of nine violations of section 17500 was based on the same evidence with one additional violation based on the advertisement appearing in the Orange County Apartment News.

The trial court also granted the following permanent injunction: "Defendants, their agents, officers, employees and representatives are enjoined from engaging in or performing directly or indirectly any and all of the following acts: "1. The preparation, other than at the specific and detailed direction of a person in propria persona or under the direct supervision of an attorney, of written instruments relating to evictions such as: three day notices, summons and complaints, at issue memoranda, judgments, writs of execution or other legal documents relating to evictions.

"2. Explaining orally or in writing, except under the direct supervision of an attorney, to individual clients: (A) the effect of any rule of law or court; [215 Cal. App. 3d 1604] (B) advising such persons as to the requirements for commencing or maintaining a proceeding in the Courts of this state; or (C) advising or explaining to such clients the forms which are legally required or how to complete such forms.

"3. Holding themselves out or allowing themselves to be held out to newspapers, magazines, or other advertising, or representing themselves as being able to provide, except through an attorney, any of the following: legal advice, the preparation of legal documents (other than as a secretarial service), or any explanation of any rules of law or court in relation to evictions or as being qualified to any of the above activities.

"4. Any employee, agent, officer, or representative of L.P.S., not a licensed member of the California Bar, is prohibited from practicing law in any form or holding themselves out as having the right to practice law in any form."

II Discussion

LPS argues there was insufficient evidence to support the finding it engaged in the unauthorized practice of law.

A

Business and Professions Code section 6125 states: "No person shall practice law in this State unless he is an active member of the State Bar." Business and Professions Code section 6126, subdivision (a), provides: "Any person advertising or holding himself or herself out as practicing or entitled to practice law or otherwise practicing law who is not an active member of the State Bar, is guilty of a misdemeanor."

The code provides no definition for the term "practicing law." [1] In Baron v. City of Los Angeles (1970) 2 Cal. 3d 535, 542 [86 Cal. Rptr. 673, 469 P.2d 353, 42 A.L.R.3d 1036], our Supreme Court noted that as early as 1922, before the passage of the State Bar Act, it had adopted a definition of "practice of law" used in an Indiana case: "'"[A]s the term is generally understood, the practice of law is the doing and performing services in a court of justice in any manner depending therein throughout its various stages and in conformity with the adopted rules of procedure. But in a larger sense it includes legal advice and counsel and the preparation of legal instruments and contracts by which legal rights are secured although such matter may or may not be depending in court."'" (Quoting People v. [215 Cal. App. 3d 1605] Merchants Protective Corp. (1922) 189 Cal. 531, 535 [209 P. 363], quoting Eley v. Miller (1893) 7 Ind.App. 529 [34 N.E. 836]; In re Utz (1989) 48 Cal. 3d 468, 483, fn. 11 [256 Cal. Rptr. 561, 769 P.2d 417]; see also 7 Am.Jur.2d, Attorneys at Law, 101-117.)

While concluding this definition a proper and sufficient one, the court in Baron, nonetheless, noted that "ascertaining whether a particular activity falls within this general definition may be a formidable endeavor." (Baron v. City of Los Angeles, supra, 2 Cal.3d at p. 543; see also Agran v. Shapiro (1954) 127 Cal. App. 2d Supp. 807, 812 [273 P.2d 619].) The Baron Court then stated: "In close cases, the courts have determined that the resolution of legal questions for another by advice and action is practicing law 'if difficult or doubtful legal questions are involved which, to safeguard the public, reasonably demand the application of a trained legal mind.' ([Agran v. Shapiro, supra] at p. [Supp.] 818 ....)" (2 Cal.3d at p. 543.)

It appears there is no California case dealing with whether eviction services such as those offered by LPS amount to an unauthorized practice of law. Since determining whether any given activity is an unauthorized practice of law depends upon the context and situation involved, it is useful to briefly review similar cases from California and other states.

In People v. Sipper (1943) 61 Cal. App. 2d Supp. 844 [142 P.2d 960] [disapproved on other grounds in Murgia v. Municipal Court (1975) 15 Cal. 3d 286 (124 Cal. Rptr. 204, 540 P.2d 44)], an unauthorized practice of law was found when a real estate broker, not involved in the sale or purchase of property, prepared for a fee a document to secure a loan with real property. The parties who sought the document were inexperienced in such matters and while they explained the nature of the loan, they did not request that any particular instrument securing the loan be prepared. The real estate broker first prepared a trust deed. When the recorder would not accept the deed the broker prepared a mortgage. (61 Cal.App.2d at pp. Supp. 845-846.)

The court concluded the broker had advised the parties concerning the type of document they should prepare to secure the loan and that such advice was an unauthorized practice of law. The court noted if the broker had done nothing more than provide a clerical service and simply filled in blanks on a particular form or had acted as a scrivener and recorded the agreement of the parties, he would not have been engaged in the unauthorized practice of law. (People v. Sipper, supra, 61 Cal.App.2d at pp. Supp. 846-847.)

While the sale of legal forms is not considered an unauthorized practice of law, the question becomes more difficult when detailed instructions for [215 Cal. App. 3d 1606] filling out the forms are provided or when the forms are accompanied by manuals providing advice for how to proceed with particular legal actions. Some useful insight into whether a given activity is an unauthorized practice of law is provided by other states' recent experiences with "do-it-yourself" legal services and manuals. While states disagree on whether the mere sale of such detailed manuals, without more, is the unauthorized practice of law (see 7 Am.Jur.2d, Attorneys at Law, 102), even those states allowing the sale of such "kits" find an improper practice of law when nonattorneys, using such manuals, particularize the advice given to individual cases.

In Florida Bar v. Brumbaugh (Fla. 1978) 355 So. 2d 1186, the Florida Supreme Court determined the publication of forms and instructip s for their use does not constitute the unauthorized practice of law if the instructions are addressed to the public in general rather than to the legal problem of a specific individual. (Id. at pp. 1191, 1193.) Brumbaugh, a nonattorney, had advertised a secretarial service offering to perform typing services, for, among others, "do-it-yourself" divorces. Brumbaugh dealt only with uncontested divorces. She first asked her customers whether child custody or support or alimony was involved and then would pick the appropriate forms for the customer. Brumbaugh then completed the forms with the proper information and told the customer how the papers were to be signed, where they were to be filled out and how the customer could arrange for a hearing. Each petition contained the allegation the marriage was irretrievably broken. Brumbaugh also told the parties how many copies of each document had to be filed and what testimony was necessary at the hearing. (Id. at pp. 1190-1191.)

The court stated while Brumbaugh did not hold herself out as an attorney, her clients placed some reliance on her to properly prepare the legal forms required. The court held Brumbaugh, and others offering similar services, could sell printed material purporting to explain legal practice and procedure and could sell legal forms. The court further held it was proper for a secretarial service to type forms for its clients, provided the information was copied from information provided the service in writing. Such a service, however, could not advise clients as to the remedies available to them or otherwise assist the client in preparing the required dissolution forms. The service "may not make inquiries nor answer questions from her clients as to the particular forms which might be necessary, how best to fill out such forms, where to properly file such forms, and how to present necessary evidence at the court hearings." (355 So.2d at p. 1194.)

In Oregon State Bar v. Gilchrist (1975) 272 Ore. 552 [538 P.2d 913], the Oregon Supreme Court was faced with a claim of unauthorized practice of law by a service that advertised and sold "do-it-yourself" divorce kits. The [215 Cal. App. 3d 1607] kits contain a packet of forms and a manual explaining how to use them. The service maintained an office and a "typing service" that completed the forms based either on information taken from a questionnaire filled out by the client or from a personal interview. Once the forms were completed, the clients were on their own. (Id. at pp. 914-915.)

The Oregon court concluded it was not an unauthorized practice of law to advertise and sell divorce kits as long as the service had no personal contact with the client. In so holding the court cited with approval New York County Lawyers' Association v. Dacey (1967) 21 N.Y.2d 694 [287 N.Y.S.2d 422, 234 N.E.2d 459]. That case dealt with the claim the sale of Norman F. Dacey's book, How to Avoid Probate, was an unauthorized practice of law. The New York court concluded it was not and made these comments pertinent to the present case: "'Dacey's book is sold to the public at large. There is no personal contact or relationship with a particular individual. Nor does there exist that relation of confidence and trust so necessary to the status of attorney and client. This is the essential of legal practice -- the representation and the advising of a particular person in a particular situation. ...

"'* * *

"'At most the book assumes to offer general advice on common problems, and does not purport to give personal [advice] on a specific problem peculiar to a designated or readily identified person.' (283 N.Y.S.2d at 997-998.)" (Oregon State Bar v. Gilchrist, supra, 538 P.2d at p. 917.)

The Oregon court, after concluding the selling of divorce kits was not an unauthorized practice of law, then stated: "We further conclude, however, that all personal contact between defendants and their customers in the nature of consultation, explanation, recommendation or advice or other assistance in selecting particular forms, in filling out any part of the forms, or suggesting or advising how the forms should be used in solving the particular customer's marital problems does constitute the practice of law and must be and is strictly enjoined." (Oregon State Bar v. Gilchrist, supra, 538 P.2d at p. 919.)

In State Bar v. Cramer (1976) 399 Mich. 116 [249 N.W.2d 1], the Supreme Court of Michigan dealt with whether a "do-it-yourself" divorce service was engaged in the unauthorized practice of law. The divorce service began with a conference with the client. The client would prepare questionnaire and the service would use the answers given to prepare the forms for filing with the court. Before the evidentiary hearing the service provided the client with a statement setting forth suggested testimony and suggested [215 Cal. App. 3d 1608] questions to be asked of a corroborating witness. At all stages of the proceeding the service expressly or inferentially advised clients as to the legal procedures involved. (Id. at pp. 2-3.)

The Michigan court, after noting the difficulty of defining "practice of law," concluded the divorce service was, indeed, practicing law. The court, looking to the opinion in Gilchrist, also believed the personal contact between the service and the client was of importance. The court noted that when a service had personal contact with its clients and explained forms and procedures, asked questions and with the answers filled out forms, the relationship developed between the parties was tantamount to that of attorney and client. The court concluded the interests involved in a divorce were considerable and that those persons offering advice concerning divorce must possess a measure of competence and judgment to insure proper representation. The court stated: "Because defendant offers counsel in the form of professional guidance to persons seeking to extricate themselves from a legal relationship, the party represented, as well as the public in general, has a right to be assured that these interests are properly represented by members of the bar. To the extent that defendant provides personal advice peculiar to the dissolution of a specific marriage, she is engaged in the 'unauthorized practice of law' ...." (State Bar v. Cramer, supra, 249 N.W.2d at p. 9.)

B

[2] The eviction service offered by LPS was designed to assist clients in the preparation, filing and resolution of unlawful detainer actions. LPS, therefore, offered to assist clients in advancing their legal rights in a court of law. We believe general California law and the approach taken by other states with respect to divorce services teach that such services do not amount to the practice of law as long as the service offered by LPS was merely clerical, i.e., the service did not engage in the practice of law if it made forms available for the client's use, filled the forms in at the specific direction of the client and filed and served those forms as directed by the client. Likewise, merely giving a client a manual, even a detailed one containing specific advice, for the preparation of ao unlawful detainer action and the legal incidents of an eviction would not be the practice of law if the service did not personally advise the client with regard to his specific case.

[3] With these principles in mind, we conclude LPS was engaged in the unauthorized practice of law. The advertisement used by LPS implies its eviction services were not limited to clerical functions. The tenor of the advertisement was that the service accomplished evictions. The advertisement's statement "Call & talk to us" was a general invitation for clients to [215 Cal. App. 3d 1609] discuss the matter of eviction with LPS. Bill Watts's LPS business card listed his title as "Counselor." In short, LPS cast about itself an aura of expertise concerning evictions.

While an eviction may not be the most difficult of procedures, it is, nonetheless, a legal procedure carried out before a court with specific legal requirements for its accomplishment. As we have seen, some courts have held that providing advice as to which forms to use, which blanks to fill in with what information or in which courts an action must be filed is itself the practice of law. Here, of course, LPS's eviction advice went further. It provided specific information to its clients concerning eviction procedure. This it did in the context of personal interviews where it was able to provide additional information and advice addressed to the specific problems and concerns of its clients. As noted above, Ms. Sutake was prepared to give advice concerning legal matters related to the unlawful detainer action. For example, she told Investigator Lopes that it was unlawful to turn off the utilities at his rental. Indeed Ms. Sutake stated in her declaration she would give clients the benefit of her experience as a landlord. In the context of the service offered by LPS this experience could relate to legal matters. Given the aura of expertise created by the business practices of LPS such advice would undoubtedly be relied upon by its clients, perhaps to their serious detriment.

LPS argues that what it describes as the "larger sense" definition of the practice of law, i.e., the giving of legal advice, is not a viable definition since it potentially applies, for example, to friends who give opinions or advice about each other's legal problems. While it is true the inherent and necessarily general nature of any definition of legal practice may allow the formulation of hypothetical situations that render the definition unworkable, we need not be concerned with such a reductio ad absurdum argument in this case. Our research has found no case in which one friend was either enjoined from giving legal advice to a friend or prosecuted for the giving of such advice. Moreover, the hypothetical situation is not before us. As we have noted any definition of legal practice is, given the complexity and variability of the subject, incapable of universal application and can provide only a general guide to whether a particular act or activity is the practice of law. To restrics oq limit the test in the interest of specificity would also limit its applicability to situations in which the public requires protection. Finally, we do not consider the present case a close one which strains the test or pushes it to an unacceptable application.

LPS also argues it is doing nothing more than court clerks do in providing forms and advice to those individuals who pick up from the courts probate or small claims forms. First, we find no evidence in the record that [215 Cal. App. 3d 1610] court clerks are providing a service such as that provided by LPS. Moreover, even if we assume some clerks at some time have overstepped the bounds of their office and have practiced law the assumption provides no defense for LPS.

The judgment is affirmed.

Work, Acting P. J., and Todd, J., concurred.

CASE TWO :

United States Court of Appeals,Ninth Circuit.

IN RE: Jayson REYNOSO, Debtor, Frankfort Digital Services, Ltd.; Henry Ihejirika, Appellants, v. Sara L. Kistler*, United States Trustee, Appellee, Executive Office of United States Trustee, Trustee.

No.04-17190.

Decided: February 27, 2007

Before B. FLETCHER and MARSHA S. BERZON, Circuit Judges, and DAVID G. TRAGER**, District Judge. M. Jonathan Hayes, Woodland Hills, California, for the defendants-appellants. Catherine Y. Hancock (argued) and I. Glenn Cohen, Appellate Staff, U.S. Dept. of Justice Civil Division, Washington, DC, for the plaintiff-appellee.

OPINION

This appeal arises from an adversary proceeding initiated by the United States Trustee ("Trustee"), during the bankruptcy proceeding of Debtor Jayson Reynoso, against Henry Ihejirika, d/b/a Frankfort Digital Services, Ltd. and Ziinet.com (collectively, "Frankfort").

The United States Bankruptcy Court for the Northern District of California found that Frankfort, a seller of web-based software that prepares bankruptcy petitions, acted as a "bankruptcy petition preparer" within the meaning of 11 U.S.C. 110 (2002)¹ and violated the requirements thereof. The bankruptcy court concluded that Frankfort had committed fraudulent, unfair, or deceptive conduct, and had engaged in the unauthorized practice of law.

The Bankruptcy Court's decision, including the relief granted, was affirmed by the Bankruptcy Appellate Panel ("BAP") of the Ninth Circuit. Frankfort Digital Servs., Ltd. v. Neary (In re Reynoso), 315 B.R. 544 (9th Cir. BAP 2004) (amended op.). The case now comes before this court on appeal. We have jurisdiction pursuant to 28 U.S.C. 158(d), and we independently review the bankruptcy court's decision-reviewing any conclusions of law de novo, while reviewing findings of fact for clear error. See Burnett v. Resurgent Capital Servs. (In re Burnett), 435 F.3d 971, 975 (9th Cir.2006); Scott v. U.S. Trustee (In re Doser), 412 F.3d 1056, 1061 (9th Cir.2005).

I.

During the relevant time period, Frankfort did business under a variety of names including Ziinet.com and 700law.com. The company is owned and operated by Henry Ihejirika. Ihejirika is not an attorney.

Frankfort sold access to websites where customers could access browser-based software for preparing bankruptcy petitions and schedules, as well as informational guides promising advice on various aspects of relevant bankruptcy law.

On January 30, 2002, debtor Jayson Reynoso accessed one of Frankfort's web sites-the "Ziinet Bankruptcy Engine." The site represented to potential customers, like Reynoso, that its software system offered expertise in bankruptcy law:

Ziinet is an expert system and knows the law. Unlike most bankruptcy programs which are little more than customized word processors the Ziinet engine is an expert system. It knows bankruptcy laws right down to those applicable to the state in which you live. Now you no longer need to spend weeks studying bankruptcy laws.

It explained that its program would select bankruptcy exemptions for the debtor and would eliminate the debtor's "need to choose which schedule to use for each piece of information."

The site also offered customers access to the "Bankruptcy Vault"-a repository of information regarding "loopholes" and "stealth techniques." For example, according to the site, the Vault would explain how to hide a bankruptcy from credit bureaus and how to retain various types of property.

Reynoso paid $219 for a license to access the Ziinet Engine, including the Vault, for 60 days. The online software prompted Reynoso to enter his personal information, debts, income, assets, and other data into dialog boxes. The program then used the data to generate a complete set of bankruptcy forms.

As promised by the site, the software selected particular schedules and exemptions for Reynoso. For example, Reynoso's Schedule C ("Property Claimed as Exempt") specified that he claimed an exemption under 703.140(B)(5) of the California Code of Civil Procedure. However, Reynoso testified that he did not type in this section number, and the bankruptcy court found that Reynoso "did not choose the exemptions that showed up on this schedule."

Where the bankruptcy forms provided a space for the signature and social security number of any non-attorney petition preparer, the software generated the response: "Not Applicable." Question #9 on the Statement of Financial Affairs required the debtor to "[l]ist all payments made [by] debtor to any persons, including attorneys, for consultation concerning debt consolidation, relief under the bankruptcy law or preparation of a petition in bankruptcy within one year immediately preceding the commencement of this case." The software generated the following response:

Realizing that this document is signed under penalty of perjury, I declare that I prepared my own bankruptcy by myself using a computer and that I was not assisted by an attorney, paralegal or bankruptcy preparer. I downloaded the software into my computer's browser as a web page, typed in my bankruptcy information and printed my bankruptcy documents on my printer in the privacy of my home without any human intervention other than mine. The software printed the official Federal bankruptcy forms with the information I typed in within a few seconds of my pressing the print button and no one other than myself inputted, edited or reviewed my bankruptcy information or handled my bankruptcy documents at any point in the process. The contents of my documents are based entirely on my own research and no one gave me legal advice or told me to include or omit any information from my documents.

The paragraph makes no mention of the fee that Reynoso paid to access Frankfort's software.

Reynoso printed the forms and filed his chapter 7 bankruptcy petition on February 28, 2002. During the first meeting with creditors, the chapter 7 trustee noticed errors in the petition and, upon questioning Reynoso, learned that he had paid for the assistance of an "online bankruptcy engine." Following further investigation, the Trustee commenced the instant adversary proceeding against Frankfort in October 2002. This was one of numerous adversary proceedings against Frankfort for violations of 11 U.S.C. 110.²

On April 11, 2003, the bankruptcy court held that Frankfort was collaterally estopped from challenging its status as a bankruptcy petition preparer engaged in the unauthorized practice of law. Alternatively, the court considered the merits and found that Frankfort qualified as a bankruptcy petition preparer, had violated the requirements placed on such preparers by 110, had committed fraudulent, unfair, or deceptive conduct, and had engaged in the unauthorized practice of law. The court found that Frankfort committed a total of nine violations of 11 U.S.C. 110(b), (c), and (f) in "each bankruptcy case filed by a Northern District of California debtor who was [Frankfort's] customer" and assessed fines accordingly. The court also ordered disgorgement of the entire fee received from any debtor-customer in the Northern District of California in the preceding twelve months, and permanently enjoined Frankfort from acting as a bankruptcy petition preparer in the Northern District of California. Finally, the court certified the fact of Frankfort's fraudulent, unfair or deceptive conduct to the district court for a determination of damages under 11 U.S.C. 110(i).

II.

In In re Pillot, 286 B.R. 157 (Bankr.C.D.Cal.2002), the bankruptcy court for the Central District of California held that Frankfort, with its Ziinet Engine, was a bankruptcy petition preparer. Id. at 162. In addition, Frankfort admitted, and the court found, that it had engaged in the unauthorized practice of law. Id. at 160-62.

In the instant case, the bankruptcy court found that the doctrine of issue preclusion barred Frankfort from challenging these conclusions, and the BAP agreed. Reynoso, 315 B.R. at 550-51.

Issue preclusion, or collateral estoppel, refers to "the preclusive effect of a judgment in foreclosing relitigation of issues that have been actually and necessarily decided in earlier litigation." Frank v. United Airlines, Inc., 216 F.3d 845, 850 n. 4 (9th Cir.2000). Issue preclusion bars relitigation of issues adjudicated in an earlier proceeding if three requirements are met:

(1)the issue necessarily decided at the previous proceeding is identical to the one which is sought to be relitigated;

(2)the first proceeding ended with a final judgment on the merits; and

(3)the party against whom [issue preclusion] is asserted was a party or in privity with a party at the first proceeding.

Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 (9th Cir.2006); see Berr v. Fed. Deposit Ins. Corp. (In re Berr), 172 B.R. 299, 305-06 (9th Cir.BAP1994). Frankfort does not dispute that it was a party to the action in Pillot and that the disposition there was a final judgment on the merits. The sole question is whether the issues decided in Pillot are identical to those appealed here.

Frankfort argues that the website accessed by Pillot differed substantially from the website accessed by subsequent customers, such as Reynoso, because the Vault and other information "relating to bankruptcy in general" had been removed.³ The record, however, indicates that the Vault was advertised to Reynoso, and the district court found that he, like Pillot, accessed it. The evidence also shows that the process of using Frankfort's software and its output were the same as between Reynoso and Pillot. Cf. Pillot, 286 B.R. at 159.

Although there is substantial support for a finding of issue preclusion, we note that the record does not include a complete print-out of the website as accessed by Pillot that can be compared with the website as accessed by Reynoso. Because there remains some possibility that, as Frankfort contends, the website changed significantly after Pillot accessed it, we decline to hold that issue preclusion applies and instead affirm the bankruptcy court's and BAP's decisions on the grounds discussed infra. Cf. Berr, 172 B.R. at 306 (noting that "[a]ny reasonable doubt as to what was decided by a prior judgment should be resolved against giving it collateral estoppel effect").

III.

A.

Pursuant to 11 U.S.C. 110(a)(1), a bankruptcy petition preparer is "a person, other than an attorney or an employee of an attorney, who prepares for compensation a document for filing." 11 U.S.C. 110(a)(1).⁴

Frankfort argues that the creation and ownership of a software program used by a licensee to prepare his or her bankruptcy forms is not preparation of a document for filing under the statute. Whether a software-provider may qualify as a bankruptcy petition preparer under 11 U.S.C. 110(a)(1) is a question of first impression in the Ninth Circuit. We hold that the software at issue in this case qualifies as such.

Frankfort charged fees to permit customers to access web-based software. Frankfort's software solicited information from the customers. Critically, it then translated that information into responses to questions on the bankruptcy forms, and prepared the bankruptcy forms for filing using those responses. As the BAP noted, "The software did not simply place the debtors' answers, unedited and unmediated, into official forms where the debtors had typed them on a screen; rather, it took debtors' responses to questions, restated them, and determined where to place the revised text into official forms.'" Reynoso, 315 B.R. at 552.

In sum, for a fee, Frankfort provided customers with completed bankruptcy petitions. Customers merely provided the data requested by the software and printed the finished forms. This is materially indistinguishable from other cases in which individuals or corporations⁵ have been deemed bankruptcy petition preparers. See, e.g., Doser, 412 F.3d at 1059-60. It goes without saying that the customer must provide data to the preparer, and the customer's role in printing or otherwise reproducing the forms before filing does not alter the role of the preparer. Moreover, 110 does not require that bankruptcy petition preparers have in-person interactions with their customers. Cf. Ferm v. U.S. Trustee (In re Crowe), 243 B.R. 43, 49-50 (9th Cir. BAP 2000) (holding that the author of an instructional book on bankruptcy petitions who guaranteed buyers of the book that he would complete their forms for free if they were unable to do so themselves was, in fact, presenting himself as a bankruptcy petition preparer as defined by 110(a)(1)), aff'd, 246 F.3d 673 (9th Cir.2000) (unpublished table decision); In re Doser, 281 B.R. 292, 303-04 (Bankr.D.Idaho 2002) (reasoning that a franchisor who receives information that was solicited in a face-to-face interaction between the franchisee and the customer and uses that information to prepare bankruptcy documents, but never meets with the customer directly, is a bankruptcy petition preparer), aff'd, 412 F.3d 1056. The bankruptcy court and BAP did not err in concluding that Frankfort was a bankruptcy petition preparer.

B.

Having affirmed the determination that Frankfort was a bankruptcy petition preparer under 11 U.S.C. 110, we now consider the propriety of the fines and other sanctions imposed by the bankruptcy court under the statute.

First, we find that the fines imposed for violations of 11 U.S.C. 110(b), (c), and (f) were proper. Evidence of record shows that bankruptcy petitions prepared by Frankfort did not include the signature, name, address, or social security of the preparer as required by 110(b) and (c). Print-outs of the website accessed by Reynoso also show that the words "law" or "legal" were used in violation of 110(f). Thus, the bankruptcy court did not err in imposing fines under these subsections.

Second, we reject Frankfort's contention that the bankruptcy court's holdings under 110(i) and (h) were erroneous. Section 110(i) permits a bankruptcy court, upon a finding that a bankruptcy petition preparer has engaged in a fraudulent, unfair, or deceptive act, to certify that fact to the district court for a determination of damages. Section 110(j)(2)(B) authorizes a bankruptcy court to enjoin a person from acting as a bankruptcy petition preparer upon a finding that she has continually engaged in, inter alia, violations of 110 or any other fraudulent, unfair, or deceptive conduct.

The bankruptcy court found that Frankfort made false statements to the court and intentionally concealed its role as a preparer. Reynoso, 315 B.R. at 553. Notably, the court found that Frankfort repeatedly and intentionally failed to disclose its identity as a bankruptcy petition preparer on the filings it prepared and failed to disclose the compensation it received for preparing the petitions as required by 110(h). The bankruptcy court and BAP deemed these ongoing acts, as well as various representations by Frankfort (such as Frankfort's claim that it could show debtors how to "[f]ile bankruptcy and keep it off your credit report!" or to "keep 3, 4, or even 5 cars"), deceptive. Id.; cf. In re Kaitangian, 218 B.R. 102, 117 (Bankr.S.D.Cal.1998) (holding that a bankruptcy petition preparer's failure to disclose all fees constituted an unfair and deceptive act). We conclude that this finding was supported by sufficient evidence and was proper. Correspondingly, we affirm the bankruptcy court's certification to the district court and issuance of an injunction.⁶

IV.

Since "bankruptcy petition preparers" are-by definition-not attorneys, they are prohibited from practicing law. Cf., e.g., In re Bernales, 345 B.R. 206, 216 (Bankr.C.D.Cal.2006) ("The law is clear: '[T]he services of bankruptcy petition preparers are strictly limited to typing bankruptcy forms.'" (quoting Kaitangian, 218 B.R. at 113)); H.R.Rep. No. 103-835, at 56 (1994), as reprinted in 1994 U.S.C.C.A.N. 3340, 3365 ("While it is permissible for a petition preparer to provide services solely limited to typing, far too many of them also attempt to provide legal advice and legal services to debtors.").

We look to state law for guidance in determining whether Frankfort has engaged in the unauthorized practice of law. See Taub v. Weber, 366 F.3d 966, 968-69 (9th Cir.2004).⁷ The parties agree that California law applies.

California courts have long accepted that, in a general sense, "the practice of law includes legal advice and counsel and the preparation of legal instruments and contracts." Baron v. City of L.A., 2 Cal.3d 535, 86 Cal.Rptr. 673, 469 P.2d 353, 357 (1970) (noting that this definition was adopted as early as 1922). But they have recognized too that "ascertaining whether a particular activity falls within this general definition may be a formidable endeavor." Id. at 358; see People v. Landlords Prof'l Servs., 215 Cal.App.3d 1599, 1605, 264 Cal.Rptr. 548 (1989) (observing that "whether any given activity is an unauthorized practice of law depends upon the context and situation involved").

Determining whether particular assistance rendered in the preparation of legal forms constitutes the unauthorized practice is often especially challenging. Cf. Landlords Prof'l Servs., 215 Cal.App.3d at 1605-09, 264 Cal.Rptr. 548 (observing, after reviewing prior cases, that merely clerical preparation services do not constitute the practice of law, and that impersonal instruction on form completion-such as may appear in a detailed manual-may also be permissible).

Several features of Frankfort's business, taken together, lead us to conclude that it engaged in the unauthorized practice of law. To begin, Frankfort held itself out as offering legal expertise. Its websites offered customers extensive advice on how to take advantage of so-called loopholes in the bankruptcy code,⁸ promised services comparable to those of a "top-notch bankruptcy lawyer," and described its software as "an expert system" that would do more than function as a "customized word processor[]."

The software did, indeed, go far beyond providing clerical services. It determined where (particularly, in which schedule) to place information provided by the debtor, selected exemptions for the debtor and supplied relevant legal citations. Providing such personalized guidance has been held to constitute the practice of law. See, e.g., Kaitangian, 218 B.R. at 110 ("[A]dvising of available exemptions from which to choose, or actually choosing an exemption for the debtor with no explanation, requires the exercise of legal judgment beyond the capacity and knowledge of lay persons."); In re Anderson, 79 B.R. 482, 484-85 (Bankr.S.D.Cal.1987) (finding that a non-lawyer had rendered legal services when he advised customer as to the consequences of filing for bankruptcy, solicited information from her and prepared the bankruptcy forms, and selected her exemptions); see also Hastings v. U.S. Trustee (In re Agyekum), 225 B.R. 695, 701 (9th Cir.BAP1998) (noting that bankruptcy petition preparers are prohibited from advising debtors as to the selection of exemptions under the Bankruptcy Petition Preparer Guidelines for the Northern District of California); People v. Sipper, 61 Cal.App.2d Supp. 844, 142 P.2d 960, 962 (Cal.App. Dep't Super. Ct.1943) (holding that the "clerical service" of filling out forms is not the practice of law, but that a defendant who goes further and makes determinations about the type of document appropriate engages in legal practice), disapproved on other grounds by Murguia v. Mun. Court, 15 Cal.3d 286, 124 Cal.Rptr. 204, 540 P.2d 44 (1975).

Frankfort's system touted its offering of legal advice and projected an aura of expertise concerning bankruptcy petitions; and, in that context, it offered personalized-albeit automated-counsel. Cf. Landlords Prof'l Servs., 215 Cal.App.3d at 1609, 264 Cal.Rptr. 548. We find that because this was the conduct of a non-attorney, it constituted the unauthorized practice of law.⁹

The judgment of the Bankruptcy Appellate Panel of the Ninth Circuit is AFFIRMED.

FOOTNOTES

1.This case arose prior to the enactment and effective date of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAP-CPA), Pub.L. No. 109-8, 119 Stat. 23, and BAPCPA's amendments to the Bankruptcy Code are not relevant to the issues before us. Accordingly, all references herein are to the pre-BAPCPA Code in effect in October 2002 when the adversary proceeding against Frankfort was filed.

2.Other cases include In re Pillot, 286 B.R. 157 (Bankr.C.D.Cal.2002); In re Briand, 02-21922 (Bankr.E.D.Pa.2002); Vergos v. ZiiNet.com (In re Liljeblad), 02-5377 (Bankr.W.D.Tenn.2002); In re Tyler, 02-00889 (Bankr.S.D.Iowa 2003); In re Renaud, 02-04923 (Bankr.S.D.Iowa 2003); and Fokkena v. Ziinet.com (In re Shugart), 02-33427 (Bankr.D.Minn.2003). With the exception of Pillot, Frankfort failed to appear to defend itself in these cases, resulting in default judgments.

3.Frankfort does not specify when this occurred but indicates that it was sometime after October 2001 but "long before" October 2002.

4.A document for filing is "a petition or any other document prepared for filing by a debtor in a United States bankruptcy court or a United States district court in connection with a case under this title." 11 U.S.C. 110(a)(2).

5.The term "person" in the Bankruptcy Code includes corporations. See 11 U.S.C. 101(41) (" '[P]erson' includes individual, partnership, and corporation. "); see also Consumer Seven Corp. v. U.S. Trustee (In re Fraga), 210 B.R. 812, 817 (9th Cir. BAP 1997) (holding that a corporation engaged in the preparation of bankruptcy petitions is not exempt from the definition of a bankruptcy petition preparer even though it is solely owned and operated by an attorney).

6.Frankfort also seeks to challenge the bankruptcy court's order of accounting and disgorgement of excessive fees. The court found that the value of Frankfort's services was negligible, and therefore ordered disgorgement "to each Northern District of California debtor who was Defendants' customer all fees received." Frankfort did not challenge the bankruptcy court's finding that its services were-in essence-valueless, when it appealed to the BAP, Reynoso, 315 B.R. at 553, or to this court. Frankfort has therefore waived its opportunity to do so, and we have no basis on which to reconsider the court's factual finding.

7.As in Taub, when the present case was decided by the bankruptcy court, 110 did not specifically prohibit the unauthorized practice of law. It stated only, "Nothing in this section shall be construed to permit activities that are otherwise prohibited by law, including rules and laws that prohibit the unauthorized practice of law." 11 U.S.C. 110(k) (2002). In 2005, 110 was amended to bar bankruptcy petition preparers from providing legal advice. 11 U.S.C. 110(e)(2).

8.Frankfort's Bankruptcy Vault claimed to show customers how to structure bankruptcy "so that it is invisible to Experian, Trans Union, and Equifax, etc.", to "reestablish good credit in 3 months instead of 3 years," and other such feats.

9.Since we are asked only to consider the facts of the case presented (i.e., Frankfort's system), we express no view as to whether software alone, or other types of programs, would constitute the practice of law.

BETTY B. FLETCHER, Circuit Judge.

For this assignment, please provide on the following topic:

UNAUTHORIZED PRACTICE OF LAW ( UPL) and the practical applications of UPL in the real world

discuss how UPL can occur in the real world, and what happens when this occurs. Please include the discussion of the two cases provided below. For instance, you should reference the facts, legal issue and outcome from at least two of the cases provided below.

Likewise, you will address the following questions :

What is the distinction between UPL and ethical paralegal work?

How can an attorney be responsible the paralegal's UPL?

How can UPL occur in a law office?

How can UPL occur in a non-law office setting, such as a real estate company or healthcare setting?