Update: Additional States Exploring Law Firm Ownership Reform

Click here for the Nov 23rd Bloomberg Law Article link Thank you Sam Skolnik!

Several new states have entered the process of exploring Law Firm Ownership Reform.

New York, Illinois, Washington DC, Connecticut, North Carolina, Florida have all now created groups to study regulatory innovation of the ABA Rule 5.4 which prohibits non-attorney ownership of law firms.

Oregon, Virginia, and Vermont have already released reports recommending reforms but have not acted on them yet.

Also California and Utah are testing and pursuing "regulatory sandboxes" of law firms being co-owned.

And recently, Arizona has lifted the embargo all together to allow non-attorneys to invest/own law firms.

According to the Bloomberg Law article, this could still be a multi-year process for mass adoption.

The New York City Bar has also recently issued a Formal Opinion (2020-1) granting the right for...well I'll let them explain it:

A New York lawyer seeks to enter into a non-exclusive arrangement with an ABS whereby the New York lawyer and the ABS agree to regularly co-counsel matters and hold themselves out to the public as having an ongoing co-counsel relationship. In any case where the New York lawyer and the ABS are co-counsel, they will jointly invoice the client and share the legal fees. 

ABS meaning Alternative Business Structure or what Arizona and the UK call the entities that are permitted to be in the business of law and have non-attorney owners.

So again I would say that this trend and mass adoption is not a matter of if but when.

Please see my original LinkedIn article on what I am predicting will be the effect of Rule 5.4 reform and dramatic changes to the legal landscape.

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Please share your thoughts below.