auto-paragraphing

the LJ auto-formatter turns newlines into <br/>, and so "paragraphs" normally get delimited by newlines. it seems like there should be a way to change that into proper <p> tags using S2, but i can't think of it. has anyone done this/has a clue how to do it? (sorry if this is documented already, but i couldn't see it in s2howto's memories).