Block on Trump's Asylum Ban Upheld by Supreme Court
So if Mother England no longer bars nonlawyers from owning equity stakes in law firms, who are we Yanks to continue our ethical objections?
After all, both the Constitution and the Judiciary Act of 1789 incorporate "the common law," i.e., the common law of England.
The British, Australians, the District of Columbia, and maybe soon North Carolina, have discarded the ethical rule against nonlawyers owning equity stakes in law firms, reports the ABA Journal.
And now multi-state law firm Jacoby & Meyers has filed lawsuits in New York, New Jersey and Connecticut, alleging the rule denies them equal protection, due process and other fundamental rights, reports The Wall Street Journal.
So is it time to revisit the issue?
Jacoby & Meyers practices law in many states. Their New York lawsuit, filed in federal court, alleges most of their clients are "those who cannot afford" expensive lawyers, reports The Wall Street Journal.
Thus, Jacoby & Meyers' complaint alleges, the firm cannot raise capital to keep up in today's technological law practice without reaching outside the legal profession "to exchange equity for capital."
Jacoby & Meyers' New York lawsuit prays for relief from New York's Rule of Professional Conduct 5.4. The firm's lawsuits in New Jersey and Connecticut make similar attacks on those states' ethics rules, reports The Wall Street Journal.
Legal grounds cited by Jacoby & Meyers include the Dormant Commerce Clause, and the Equal Protection and Due Process clauses of the 14th Amendment.
Interestingly, the complaint also alleges class action status, on behalf of "all entities and persons licensed to practice law in the State of New York."
Critics of the idea rely on familiar arguments regarding loss of confidentiality, loss of independence, conflicts of interest and possible loss of professionalism, reports the ABA Journal.
The ABA seeks input to its study group on the subject, the Ethics 20/20 Commission.
If the ABA, historical standard-bearer for the status quo, has started gathering facts, this issue might soon be sounding in a courthouse near you.