By David Hricik, Mercer Law School
An issue I’ve frequently been asked to discuss is the ethical constraints on firms to impose restrictions or requirements on departing lawyers — such as precluding a lawyer from doing logistical work on setting up a new, separate firm upon departure — as well as the departing lawyer’s obligations to her clients and soon-to-be-former firm. In addition, migrating lawyers create issues for the new employer, such as imputed disqualification of former client conflicts.
In December 2019, the ABA issued a formal ethics opinion that clarified the ability of firms to restrict departing lawyers. In American Bar Association Formal Ethics Op. 489 (available here). The synopsis provides a good summary:
Lawyers have the right to leave a firm and practice at another firm. Likewise, clients have the right to switch lawyers or law firms, subject to approval of a tribunal, when applicable (and conflicts of interest). The ethics rules do not allow non-competition clauses in partnership, member, shareholder, or employment agreements. Lawyers and law firm management have ethical obligations to assure the orderly transition of client matters when lawyers notify a firm they intend to move to a new firm. Firms may require some period of advance notice of an intended departure. The period of time should be the minimum necessary, under the circumstances, for clients to make decisions about who will represent them, assemble files, adjust staffing at the firm if the firm is to continue as counsel on matters previously handled by the departing attorney, andsecure firm property in the departing lawyer’s possession. Firm notification requirements, however, cannot be so rigid that they restrict or interfere with a client’s choice of counsel or the client’s choice of when to transition a matter. Firms also cannot restrict a lawyer’s ability to represent a client competently during such notification periods by restricting the lawyer’s access to firm resources necessary to represent the clients during the notification period. The departing lawyer may be required, pre- or post-departure, to assist the firm in assembling files, transitioning matters that remain with the firm, or in the billings of pre-departure matters.
It is important, in my experience, for departures (and arrivals) to be done with sensitive both to the various relationships involved when a lawyer departs, and, as well, to the complex conflict issues that face the new employer. This ABA opinion helps on the first issue and suggests the need, for example, to examine partnership or other policies or agreements among lawyers to ensure good practices.
That’s interesting, and the problem exists now. When a non-lawyer leaves a firm, the ability of that non-lawyer to be adverse to a former client (and the impact on a new firm of hiring the non-lawyer) is very different than if a lawyer leaves and goes to a new firm. Why? Historically, there’s an assumption that non-lawyers won’t really know/understand what they did or be able to use the information at the new firm.
In these new models, which rule applies? (If there weren’t ethical rules for patent agents, you could have the same issue, and, in fact, there’s some weird things about patent agents — are they “non lawyers” for state rules about conflicts, or not, for example.). I digress.
I have to wonder if the ethical obligations implicated here penetrate (to non-lawyers, for example) the growing movement of several states (for example, California, Utah, Colorado, Florida, and New York) to create pathways for NON-lawyer practice of law.
It may be one thing for a lawyer to lawyer (or law firm to law firm) transition, but the larger scope of evolving law practice may well implicate transitions of a much different nature.
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