Legal Question in Business Law in California

Re: Business Formation

Rule of Professional Conduct 1-320(A) says that neither a lawyer nor a law firm may directly or indirectly share legal fees with a person who is not a lawyer. The rule goes on to list four exceptions, none applicable here. Subsections (B) and (C) of Rule 1-320 go even further to prohibit deals of the type you're suggesting.

In addition, Business & Professions Code sections 6150 through 6156 deal specifically with arrangements where non-lawyers and non-lawyer firms act to solicit or direct legal business to particular lawyers with whom they have financial arrangements, and in general bars such arrangements. You should locate a copy and read it carefully (it is available on line).

Re: Business Formation

I suspect that you are really spamming this forum for ad clients, but I will answer anyway. I doubt that you, a nonlawyer, could legally own a corporation called a "law group." Your corporation can employ lawyers, but if you are a lawyer's boss, you can't tell him or her how to practice law. Lawyer referral services are regulated by the State Bar.

Re: Business Formation

You can employ attorneys to represent your interests. If you own a business, the business can employ attorneys to represent its own interests. But neither you nor your business can employ attorneys to represent the interests of third parties. By law, only attorneys can have an ownership interest in a law practice.

Re: Business Formation

A lawyer cannot own a business with a non-lawyer that does legal services. I would have to check, but my first impression is that if you only employ them, it would not violate that particular rule. I think I see what you are trying to do - monetize this connection between attorneys and clients - with you in the middle. However, lawyers run their own businesses and cant give referral fees to non-lawyers either. Setting up a lawyer referral service is very legally complex also. I may have an idea or two on how you could do this. Please email me to discuss.

Best,

Daniel Bakondi, Esq.

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