The State of Tennessee is considering allowing non lawyers to own law firms. This is a big step in the slow but steady pursuit of law firm ownership by private equity companies. Rule 5.4(a) prohibits the sharing of fees with a non lawyer. Rule 5.4.(b) prohibits non lawyer ownership of law firms. The Tennessee Supreme Court issued an order seeking comment on the question. The order recites the usual phrases about access to justice. Generally, access to justice is a real issue, but many of those who cannot obtain counsel have cases that lawyers won’t accept because (a) there is no prospect for payment; or (b) the client wishes to pursue goals or objectives that are illegal or plainly wrong. It is highly doubtful that private equity firms will increase access to justice.
Non lawyer ownership of law firms means that the lawyer would share fees with non lawyers, a violation of Rule 5.4. That rule maintains the current status of the legal profession. Ownership by non lawyers inevitably means that ethical standards will slip and that lawyers will focus on the business people rather than their clients.
Arizona eliminated Rule 5.4 in 2021.
