Trends and Analysis for Successfully Transitioning Lateral Partners
into New Partnerships While Minimizing Risk and Reducing Potential Liabilities

Managing Law Firm Dissolutions in Uncertain Times

As the legal industry continues to adjust to life during a pandemic, some law firm transitions and transformations inevitably will lead to law firm closures and dissolutions. We have seen numerous headlines of law firms, big and small, actively tightening their belts. But if, or when, a law firm considers closing its doors, is dissolution the best option? And will its partners and clients be protected?

The end of a law firm marks a critical time for law firm partners, shareholders, and clients, and must be handled with the utmost care. Making the right decisions is essential to protecting the personal and professional interests of individual partners, their clients, and law firm employees. This is especially true now when there is so much uncertainty about the future of the legal market.

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California Law Firm Departures in the COVID-19 Era

We read the news daily of law firms – big and small – announcing cutbacks, furloughs, layoffs, reductions in salaries, and distribution freezes. Every industry has been feeling the impact of this global pandemic, and the legal industry is no different. As lawyers who inherently crave predictability, it is difficult to conceive of when and how things will return to “normal,” if everything should, or if we are living in the “new normal” now. But in an age of increasing attorney mobility, what does all this uncertainty mean for law firm departures? Will the impact of the pandemic contribute to an increase in law firm departures – directed by both law firms and lawyers? Will law firms see partners and groups departing now, or do most lawyers plan to wait out the storm? The answer to all these questions is probably, yes. 

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What Does ABA’s Departure Opinion Mean for California Law Firms?

Although we routinely see headlines about partner and group departures, especially during this time of the year, the ABA’s recent ethic’s opinion on obligations for lawyers changing firms (ABA Formal Opn. 489, December 4, 2019) received much less attention. Law firms should have taken notice, however, because the opinion represents some significant new thinking on law firm notice provisions. Of course, legal ethics opinions are only advisory and for California law firms who are governed by California rules and case law, not all of the ABA’s analysis applies. Furthermore, on January 25, 2020, the State Bar of California’s Board of Trustees approved for publication California’s own ethics opinion addressing departing lawyers drafted by the Committee on Professional Responsibility and Conduct (COPRAC). The COPRAC opinion provides guidance to both law firms and lawyers involved in departures in California.

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California’s New Rules: How New Conflicts Rules Impact Attorney Departures

The new California Rules of Professional Conduct are now in effect and have changed how law firms and lawyers must identify and analyze conflicts when considering lateral hires.  As we have previously reported, the new rules have a tremendous impact on all California attorneys, including for law firms and lawyers navigating attorney departures and law firm transitions.  In this post, which is part of a series, we will examine how certain new conflicts rules, rules 1.7, 1.9 and 1.18, will impact law firm departures. More

California’s New Rules: How Communication Rules Impact Attorney Departures

As most of you likely know by now, on November 1, 2018, the new California Rules of Professional Conduct will go into effect changing the regulation of the practice of law for all California attorneys. The significant changes to the prior rules and the enactment of some entirely new rules will have a tremendous impact on all California attorneys. Here, we will analyze the effect of the new rules on attorney departures and law firm transitions. In this post, which is one in a series, we will examine how the new Rule 1.4, Communication with Clients, will impact attorney transitions. More