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

Partner Departure Tip: Don’t Let Your Emotions Rule the Day

Perhaps the single biggest factor partners underestimate when transitioning their practice to a new firm, or starting a new practice, is the emotional impact of the move. Even those who consider themselves stoic and rational by nature are often caught off-guard by how highly emotional this transition can be, for both the departing partner and for those whom he or she is leaving behind. In fact, there are a whole host of emotions that may accompany any departure including excitement, relief, sadness, anger, elation, fear, betrayal and sometimes a bizarre combination of them all. However, emotions can be kryptonite to judgment. And clouded judgment often results in poor decision-making. More

Departing Partners And Potential Conflicts With Current And Former Clients: The Featured Role Of The “Substantially Related” Test In Two Recent Disqualification Decisions

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

Nelson Levine v. Lewis Brisbois Just Settled: Firm Laptops and the Computer Fraud and Abuse Act – Lessons from A Recently Resolved Attorney Departure Case

As many attorneys who follow partner departures and lateral moves know, in 2014 a group of attorneys at Nelson Levine De Luca & Hamilton, LLC (“Nelson Levine”) in Montgomery County, Pennsylvania, left the firm to join Lewis Brisbois Bisgaard & Smith LLP (“Lewis Brisbois”), a California limited liability partnership. This departure resulted in litigation that serves as a primer on the Computer Fraud and Abuse Act, underscoring the importance of adding firm-issued laptops and the handling of other technology (often accessing confidential information) that attorneys regularly use, to the growing list of topics that firms and departing attorneys should address as part of the firm’s policies and procedures and in advance of any separation.
More

Partner Departures and Golden v. California Emergency Physicians Medical Group: Does California’s Business and Professions Code § 16600 Void Any Partnership Provision that Restricts a Departing Partner’s Right to Compete?

The Ninth Circuit’s recent decision, filed April 8, 2015, in Golden v. California Emergency Physicians Medical Group (9th Circuit) Case No. 12-16514, has potentially far-reaching implications for what is deemed to be an unlawful professional restraint in violation of California’s Business and Professions Code § 16600. In closely examining the statute, the Ninth Circuit concluded that the reach of § 16600 does extend far beyond non-compete provisions to every contract restraining someone from “engaging in a lawful profession, trade or business.” With respect to partner departures, some restrictions contained in partnership agreements in anticipation of dissolution or partner departure are excluded from this rule by Section 16602. However, even non-compete agreements between partners, and other contractual provisions that have a similar effect, may be unenforceable if they impose any restrictions on a partner’s right to practice law not contemplated by Section 16602. More

Partner Departure Tip: Locate Your Partnership Agreement and Read It

If you are a partner in a law firm, your partnership agreement is the key document that defines your rights and obligations as a partner. It can govern everything from how you get paid, to how the firm is managed, to what liabilities you have agreed to assume. In addition, it most likely has specific terms that impact how you should properly withdraw or depart from your partnership when the time comes. However, the longer you serve as a partner in a firm, the further removed you often are from what is actually contained in the partnership agreement (which also may have been amended numerous times over the years.) More