The American Bar Association issued a formal opinion that fleshed out the ethical obligations for attorneys and firms involved in a lateral move, guidance that comes at a time when partner transience reaches a fevered pitch and competition for clients becomes increasingly cutthroat.

Recruiters praised the opinion, formal opinion 489, for providing guidance on two often fraught issues in a lateral move: notice provisions for departures and client solicitation.

In the opinion, the ABA stated that law firms cannot subject their attorneys to "fixed" or "rigidly applied" notice provisions—clauses that are common in partnership agreements. Instead, they should opt for the standard of "reasonable notice," which primarily takes into account client interests, the ABA said.

The opinion also addressed issues surrounding client solicitation, stating that while it is preferable for a law firm and the departing attorney to issue a joint statement, firms cannot prohibit the lateral attorney from soliciting firm clients once the firm is notified of the departure.

"Essentially, the opinion makes clear that such restrictions or other stratagems which firms have employed to try and secure an advantage in trying to retain the business of clients who are likely to depart with the partner are not permitted," said New York litigator Geri Krauss, author of "Partner Departures and Lateral Moves, A Legal and Ethical Guide."

The opinion also noted that a firm cannot try to dislodge an attorney's influence on a client by, for example, assigning a new lawyer to a client's matter predeparture.

What constitutes a "reasonable" notice period or "penalty" is subject to the interpretations of state bars. In many states, local laws concerning an attorney's fiduciary duty to a client may lead to an interpretation by state courts. As with all ABA formal opinions, the guidance is nonbinding.

Barbara Gillers, a New York attorney who chairs the Standing Committee on Ethics and Professional Responsibility, did not respond to a request for comment.

Some states, including Florida and Virginia, have already instituted rules governing clients and lateral moves. In Florida, for example, departing attorneys may not unilaterally contact firm clients to notify them of the departure unless the lawyer has attempted to negotiate joint communication to clients.

Veteran Florida recruiter Joe Ankus applauded the ABA for stepping in and providing guidance on a process he describes as "cloak and dagger," where departure clauses in partner agreements are often ignored and both the firm and attorneys jockey to retain a client behind the scenes.

"Lawyers leave law firms for a lot of reasons and this rule is trying to provide some safety bumpers for lawyers to leave law firms ethically," Ankus said.

But given the animosity that often emerges from a departure and the economic stakes involved in an increasingly competitive client market, Ankus doesn't expect that the rules, even if adopted by all state bars, will make the process any more congenial.

"The ABA did their best to try to reconcile the unpleasant economic effects between the departing lawyer and the firm," he said, noting that it reads well on paper. "But I'm telling you that in the field … it can get a little ugly."

The opinion also provided guidance on the obligations a firm and the departing attorney have in transitioning.

  • The firm and attorney must coordinate an "orderly and timely" transition of files as directed by the client, the return of firm property and notification to other firm attorneys and staff.
  • Firms may require that departing attorneys notify firm management at the same time they notify clients, firm employees or "others."
  • Firm management should develop policies that protect the confidentiality of client information, the exception being that a departing lawyer can retain names and contact information for a conflict analysis.
  • Firms should not continue to represent a client if the departing attorney is the only lawyer at the firm with the specific expertise needed to service that client, unless the firm can retain other lawyers with similar expertise.
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