This is interesting….

Suit Challenges N.Y. Prohibition of Non-Lawyer Firm Ownership

Lawsuits filed by Jacoby & Meyers challenging state prohibitions on nonlawyers owning interests in law firms have added fuel to the debate over how to protect the interests of clients should American law firms ever be allowed to accept outside investment.

In virtually identical lawsuits filed Wednesday in New York, Connecticut and New Jersey, Jacoby & Meyers casts its challenge as client-friendly, claiming the ban on nonlawyer investment denies firms the ability to raise outside capital, denying most lawyers “a critical source of funding” that “dramatically impedes access to legal services for those otherwise unable to afford them.”

Jacoby & Meyers’ legal argument is based on the Commerce Clause and several other provisions of the U.S. Constitution. For example, the complaint in New York claims that small law firms are unable to compete because of the “out-of-date” restriction in Rule 5.4 of the New York Rules of Professional Conduct that governs the independence of law firms and the sharing of fees with non-lawyers. A similar provision exists in Connecticut, New Jersey and most other jurisdictions. The firm says that abolishing the rule would level the playing field because small firms do not have the same access to capital that Wall Street firms have to improve technology and infrastructure, expand offices and hire personnel.

Check out the rest of the article here…

Isn’t this what Lender Processing Services, the servicers and their attorneys are having “issues” with?

Full complaint below…


h/t Marilyn


Jacoby & Meyers Law Offices, LLP v. The Presiding Justices of the First, Second, Third, Fourth Departments, Appellate Division of the Supreme Court of the State of New York