Gene Shipp and Lawrence Bloom, DC Office of Bar Counsel

DC could be an incubator to see how [alternative structures] could work in the United States. But it can’t be.

The Office of Bar Counsel serves as the chief prosecutor for attorney disciplinary matters involving attorneys who are members of the District of Columbia Bar. Wallace E. “Gene” Shipp, Jr. serves as Bar Counsel and Lawrence Bloom serves as Senior Staff Attorney.

It is difficult for a firm to know how to work under DC’s Rule 5.4. Here is an example:

Imagine a small law firm in North-East DC with two partners. Imagine that the firm has a family law practice, and it sees that its clients are experiencing certain problems and questions regarding their fitness as parents, for example, and decides to bring a social worker on board. The firm wants to help its clients improve their skills as they go through a child custody or child support proceeding. It’s a great idea — this two-person firm providing access to justice.

So they approach a social worker, but the social worker will only come on board if they are made partner and get a cut of the action.

So, there they are — a three person firm — two lawyers and one social worker.

But the social worker is bound by its own ethical rules to report any abuse or other illegal activity. Therefore, they cannot be bound under the rules of confidentiality that apply to the firm. But the heart and core of a law firm is confidentiality.

On the other hand, if that social worker had been hired as a consultant, it would have been bound by the same obligation to report.

This presents a dilemma for the firm. Rule 5.4 presents an opportunity for new kinds of legal services to be delivered, but it requires the firm to tread carefully.

In addition, a firm like this could work only if the lawyers were admitted just in DC and not in any other state. Because if they were admitted in another state, an arrangement of this kind would violate that other state’s rules. But there are very few DC lawyers who are not also admitted in another state.

You could make a case that the principle purpose of Rule 5.4 is to permit retiring Congress people to remain in DC and work as lobbyists.

But regardless of the reasons why Rule 5.4 was adopted and regardless of its potential uses, the reality is that very few people are taking advantage of it because no one is quite sure how to make it work. Instead, they set up work-arounds, such as an ancillary firm down the hall, or taking on the person as an employee and offer them a salary, a cut of the profits and a retirement program.

In this context, it is not a surprise that DC’s Office of Bar Counsel has never been presented with any complaint, and the Office has never investigated any firm, in connection with nonlawyer ownership of a law firm.

It appears that multidisciplinary practices and nonlawyer ownership of law firms is the future. It is not the end of the natural world as we know it. Places like England and Australia have figured out how to make it work. DC could be an incubator to see how this could work in the United States. But it can’t be because it’s just too tricky for a firm to make things work under the Rule.

This story is supplemental material for Modernizing Legal Services in Common Law Countries: Will the US Be Left Behind? To learn more about the book, please click here.

To download a pdf of this and the other stories, please click below.


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