California Lawyers Association

CLA Commends ABA Resolution for Reconfirming Core Values in Law Firm Ownership

August 15, 2022

The California Lawyers Association (CLA) commends the American Bar Association’s (ABA) passing of a resolution opposing revision to the law prohibiting lawyers from sharing legal fees with non-lawyers and from transferring to non-lawyers ownership or control over entities practicing law. Resolution 402, passed during the ABA’s annual conference in Chicago, upholds the notion that “sharing of legal fees with non-lawyers and the ownership or control of the practice of law by non-lawyers are inconsistent with the core values of the legal profession.”

CLA voiced concerns in a September 2019 letter to the State Bar of California regarding potential amendments to Rule of Professional Conduct 5.4 that would allow non-lawyers to participate in fee-sharing and share in the profits or ownership of entities that deliver legal services, among other proposed recommendations aimed to address California’s justice gap. CLA recognizes the necessity of mending California’s justice gap, and it has urged the State Bar of California to consider alternative methods for correction that do not sacrifice the ethics of the legal profession, such as the funding of preexisting, effective programs, and addressing the existing knowledge gap as well as the true justice gap. CLA voiced its concerns to the State Bar of California once again in a January 2022 letter.

“On behalf of the California Lawyers Association, I was proud to support and recommend the adoption of Resolution 402,” said Jeremy Evans, President of the California Lawyers Association. “I was very pleased to work with and see our wonderful California Delegation to the American Bar Association House of Delegates support Resolution 402, which received unanimous support, reconfirming our core values of practicing law to the highest standards, while protecting consumers, who are our clients,” said President Evans.

Resolution 402 also reaffirms ABA policy in Resolution 20M115, encouraging U.S. jurisdictions to explore alternative methods of increasing access to justice, including addressing the affordability of legal services. While other state bar associations, including the Illinois State Bar Association and New York State Bar Association, have shown support for the ABA’s resolution, it comes on the heels of states such as Arizona and Utah loosening fee sharing and law firm ownership restrictions, and others such as California, Michigan, and North Carolina considering similar changes.

“We should be doing everything that we can do in the legal profession to create greater pathways and enhance access to justice, but we should not do so in a manner that would negatively impact the constituents who need help the most,” said Oyango Snell, Esq., CLA’s CEO and Executive Director. “Resolution 402 amplifies the voices of the California legal community that sharing legal fees and ownership of legal services with non-lawyers could create unintended harm to consumers,” said Snell.

CLA will continue to express its concerns relating to changes to the legal profession and exercise its voice on behalf of the entire legal community. Although a California-based organization, CLA will represent its constituents on both statewide and national levels.

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