Challenge to Rules Banning Non-Lawyer Ownership Stakes in Law Firms

We told you to watch out for it, and now it's here.  England has changed its rules governing legal practice to allow nonlawyer participation in the ownership of law firms, and now New York law firm Jacoby & Meyers has filed lawsuits  in New York, New Jersey and Connecticut challenging the rules that prohibit nonattorneys from owning stakes in law firms.  A Wall Street Journal story on the development quotes Michigan lawyer Mark Bernstein as remarking, "The ability to turn to other sources of capital to support activities of our firm or to monetize our investment, like any successful business, would be a welcome option."  The story reveals that one U.S. jurisdiction -- Washington, D.C., has already quietly taken the plunge and allows nonlawyer stakes in D.C. firms.  But, the rule change has had little or no impact because law firms with D.C. offices typically have offices elsewhere and remain bound by rules in those jurisdictions.