Lateral Hiring.

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

In today’s legal world, the traditional view of what it means to be a “partner” seems to be ever-changing. As more law firms move from two-tier to multi-tier partnerships, the question of what it truly means to be a non-equity, income, or salaried partner is becoming an increasingly important issue. Specifically, during any partner departure or lateral transition, the exact nature of the partner’s status has a variety of ethical, contractual, and legal implications for the lawyer, as well as for the law firm. This issue must be analyzed carefully as part of any law firm departure. More

In the space of fifteen months, the Northern District of Texas and the District Court of Delaware have each issued significant attorney disqualification orders. In both cases, the “substantially related” test regarding past and present representations had a featured role in the courts’ decisions to disqualify the same California law firm from significant patent cases. For departed partners and their new firms, these decisions serve as important reminders about the key factors to analyze before becoming adverse to former clients. More

On June 11, 2014, U.S. District Judge Charles Breyer issued a significant ruling in favor of several large law firms in the ongoing fight regarding whether and if a dissolved law firm has the right to profits from unfinished legal work its former partners brought to their new firms.  In his Order granting summary judgment in favor of the law firms and against the Trustee for the defunct Heller Ehrman LLP, Judge Breyer was reviewing de novo an earlier Bankruptcy Court order that went against the law firms and in favor of the Heller Ehrman Trustee.  In a case of first impression, Judge Breyer concluded that under the facts presented in this case, “neither law, equity, nor policy recognizes a law firm’s property interest in hourly fee matters.” More

There has been a lot of recent press about the validity of Unfinished Business Claims in California (also known as Clawback claims) following a ruling earlier this year by U.S. Bankruptcy Judge Dennis Montali in San Francisco related to the Howrey, Simon, Arnold & White LLP (“Howrey”) bankruptcy.  At issue, was whether the trustee of a bankrupt firm had any basis to proceed against the firm’s former partners to recover profits from unfinished legal business matters that followed former partners to their new firms, even if those profits apply to hourly rate matters.  Although other jurisdictions have litigated this issue (both D.C. and New York), no California court has expressly interpreted the Unfinished Business Rule, as set forth in Jewel v. Boxer (1994) 156 Cal. App. 3d 171 (“Jewel”), as applying to hourly rate matters upon partnership dissolution. More