New Laws Regarding Who Can Own Law Firms

New Laws Regarding Who Can Own Law Firms

It’s commonly thought that only lawyers can own law firms, and for decades that’s been true. But recent changes in Arizona and Utah have bucked the system, partly in response  to calls for criminal justice reforms. Arizona has earned the title as the first state to allow non-lawyers to own law firms and Utah followed shortly after with a range of reforms that allow non lawyers to own or invest in law firms. Utah’s reforms are part of a two-year test period.

The Benefits of Nonlawyer Ownership

Nonlawyer ownership might sound like crazy talk to start with. But when you dive a little deeper into the idea, you begin to see that the benefits are actually quite numerous. For example, if you want to hire talented marketers or programmers for your firm and reward them with ownership in the firm, you can do that. Firm that can be owned by nonlawyers can be much more innovative because of the diversity of employees.

  • Diverse approach to thoughts and ideas
  • Unique pool of employees and team members
  • Incentive for others to partner with firms
  • Increase in access to justice

The Drawbacks of Nonlawyer Ownership

Depending on who you talk to, the drawbacks of nonlawyer ownership can seem vast. When you have non lawyers owning law firms you can experience the range of issues that come from a person getting involved in a business that they don’t understand.

  • Misunderstanding of the industry
  • Potential for lack of professional independence (nonlawyers making legal decisions)
  • Alternative approaches to legal management

So, what’s the right decision? Ultimately, time will tell. Arizona and Utah are pioneers in the pursuit of access to justice. It’ll take a few years before we see the real implications of nonlawyers owning law firms. That’s not a bad thing. All progress comes from a movement starting and others following.

When other states take notice of the effects of Utah and Arizona’s approach, they could ultimately follow and a whole new era of law firm ownership will follow.

One Response

  1. Washington DC has being allowing that combination and it is devastating to other states -fraudster are claiming to have a partnership in Washington to commit fraud in other states i.e. immigration law etc.

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