US lawyers fear non-lawyer firm ownership on the horizon

Local US bar groups are jittery over a resolution under consideration by the American Bar Association this week, which many fear will open the door for non-lawyer ownership of firms.

The ABA House of Delegates is meeting in San Diego this week. Dancestrokes

On Monday morning, the ABA House of Delegates will consider a policy resolution that many fear represents the thin end of the wedge for non-lawyers moving in on legal practice—a doomsday scenario for many in the profession. The convoluted yet seemingly innocuous Resolution 105 calls for the adoption of 'regulatory objectives for the provision of legal services' that would help 'identify and implement regulations related to legal services beyond the traditional regulation of the legal profession.' However, many lawyers fear that between the lines of Resolution 105 is the groundwork for non-lawyers to enter the legal services sector as law firm owners.

Ethical concerns

Currently, the District of Columbia is the only US jurisdiction in which non-lawyers can purchase stakes in law firms. While advocates suggest that liberalising ownership could drive innovation in the sector and reduce the costs associated with accessing legal assistance, opponents maintain that opening the door for non-lawyer owners puts firms and their legal staff in an unacceptable ethical bind. Specifically, lawyers are concerned that investor and shareholder influence over firm decision-making may compromise lawyers' ethical duties to their clients. There are also concerns that Resolution 105 makes space for non-lawyers to become providers of legal services.

Stringent opposition

'Non-lawyer ownership of law firms creates a whole new set of fiduciary responsibilities, which have nothing to do with the best interests of the clients we are duty-bound to serve,' commented New York State Bar Association president David P. Miranda in a statement opposing the resolution. Long-time opponent of non-lawyer legal practitioners Lawrence Fox of Drinker Biddle & Reath is also looking to whip up opposition to the resolution, sending out an email on 29 January titled 'Save Our Profession'. 'If we are going to show leadership, it ought to be in opposing the unauthorised practice of law, wherever it rears its ugly head,' Mr Fox wrote. Sources: The Wall Street JournalThe American Lawyer

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