Are non-competes for lawyers permitted? The American Bar Association (ABA) Standing Committee on Ethics and Professional Responsibility recently released additional guidance regarding ethical obligations when lawyers change firms in the United States. Formal Opinion 489 acknowledges that lawyers have the right to change firms and reiterates that ABA ethics rules (which have been adopted by most states) do not allow non-competes in agreements between lawyers.
The Formal Opinion suggests that when a lawyer gives notice of his or her intent to leave a firm, the firm should develop a plan that is orderly, flexible and, most importantly, “protects client interests during the transition.”
No Non-Competes for Lawyers
In order to enhance the chances of an orderly transition, many firms require advance notice of resignation from a firm. The Formal Opinion reaffirms that law firms may require some period of advance notice of intended departure. However, the opinion also says that “the period of time should be the minimum necessary under the circumstances for clients to make decisions about who will represent them, assemble files, adjust staffing at the firm, if the firm is to continue as counsel on matters previously handled by the departing attorney, and secure firm property in the departing lawyer’s possession.” The opinion goes on to say that “firm notification requirements, however, cannot be so rigid that they restrict or interfere with a client’s choice of counsel or the client’s choice of when to transition a matter.”
Unlike many other professions, including the medical profession, the ABA continues to lead the way in ensuring that client choice is the most critical consideration with respect to any restrictions that may be placed on lawyers who move from firm to firm. While the ABA and most state Bar associations have established the policy that client choice with respect to legal services is of the utmost importance, the medical profession has not followed suit. It is ironic that the public has the absolute right to choose their lawyer, but they do not necessarily have the absolute right to choose their doctor or other healthcare provider. Doctors and other healthcare providers are often subject to non-competes that prohibit them from providing medical care to certain patients if the doctor leaves the practice or hospital with which he or she is associated. By contrast, non competes for lawyers has been addressed, and effectively outlawed, by guidance from the ABA.
Benjamin Fink is known for his work in noncompete, trade secret and competition-related disputes. A shareholder at Berman Fink Van Horn, Ben concentrates his practice in business and employment litigation.