US lawyers uphold opposition to non-lawyer ownership of firms

Weiler: History made

The American Bar Association (ABA) yesterday stressed its continuing opposition to non-lawyer ownership of law firms, with a key mover claiming it was “protecting the public from profiteers”.

Its House of Delegates – its policy-making body – unanimously reaffirmed a policy dating back to 2000 that described lawyers sharing fees or law firm ownership with non-lawyers as “inconsistent with the core values of the legal profession” and that the bans on them should be retained.

As we reported yesterday, the move came against the background of Arizona and Utah allowing alternative business structures (ABSs), with other states also looking at regulatory reform.

US lawyers are regulated by individual state supreme courts – ABA resolutions are persuasive but not binding.

The resolution was passed after being amended to make clear that it did not seek to abrogate another resolution passed in 2020 which encouraged states “to consider regulatory innovations that have the potential to improve the accessibility, affordability, and quality of civil legal services”.

To complete the circularity – and to show the sensitivity of the issue – the 2020 resolution said it should not be read as recommending allowing non-lawyer ownership of law firms.

Yesterday’s resolution was proposed by the Illinois State Bar Association. Its president, Rory Weiler, said the House of Delegates had made history.

“In an age where other professionals are being bought and sold like commodities, the ABA’s House of Delegates reaffirmed a decades old ABA policy that non-lawyer ownership of law firms, and fee splitting with non-lawyers is anathema to the legal profession and in direct conflict with the core values that have sustained our profession for generations.

“In the legal profession, protection of the public, particularly against predatory pecuniary policies is paramount, and will continue to be the primary focus of our profession.”

He said his predecessor, John Thies, had spent eight months building support to defeat “those who would commoditise our profession at the public’s expense”.

Mr Weiler continued: “We’re not finished. Access to justice issues still need to be addressed, and efforts to replace lawyers with AI, software, and other forms of enabling non-lawyers to provide legal services still exist, and will continue to be proposed…

“As we pursue innovation and expansion of the delivery of legal services to the indigent and the needy, we are grateful that our efforts will involve innovations that have lawyers providing those legal services to the public and our system of justice.

The New Jersey State Bar Association, one of the resolution’s key supporters, tweeted: “This is great news. The #NJStateBar is proud of the work of its members, and the coalition of attorneys and bar associations around the country, that supported this important affirmation of the critical underpinnings of our profession.”

Ron Friedmann, a well-known commentator on the US legal profession, tweeted: “It’s not a surprising outcome but is still depressing.” He suggested that the evidence of what has happened with ABSs in England and Wales, Australia and Arizona was ignored in taking the decision.

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