A contract is a contract… unless it’s about referral fees.
Chris F.N. Rose
Founder, LegalFlare
I help law firms refer out the cases they don’t want.
Referral fees
ABA Model Rule 5.4(a)
“A lawyer or law firm shall not share legal fees with a nonlawyer …”
Referral fees
ABA Model Rule 7.2(b)
“A lawyer shall not compensate, give or promise anything of value to a person for recommending the lawyer’s services …”
Some states, including Nevada, take this a step further.
Referral fees
AKA Capping
“… it shall be unlawful for a person to solicit a tort victim to employ, hire or retain any attorney at law …”
At a crash scene, a jail, a medical facility, or within 72 hours.
NRS 7.045
Referral fees
Fee splitting
Splitting Fees Between Lawyers
ABA Model Rule 1.5(e)Divide it up.
“A division of a fee between lawyers who are not in the same firm may be made only if:
(1) the division is in proportion to the services performed by each lawyer or each lawyer assumes joint responsibility for the representation;
(2) the client agrees to the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing; and
(3) the total fee is reasonable.”
Fee splitting
Fee splitting
Nevada Rule 1.5(e)
“A division of a fee between lawyers who are not in the same firm may be made only if:
(1) Reserved;ABA (1):the division is in proportion to the services performed by each lawyer or each lawyer assumes joint responsibility for the representation
(2) The client agrees to the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing; and
(3) The total fee is reasonable.”
Fee splitting
What is the FN point?
Why the rules exist
Protecting the Clients
“[T]he public interest is to prevent attorneys referring clients to other attorneys based on the referral fee, rather than the client’s best interests.”
Katz v. Frank, Weinberg & Black, P.L., 268 So. 3d 773 (Fla. 4th DCA 2019) (Forst, J., concurring specially)
Katz v. Frank, Weinberg & Black, P.L.
“[C]apable of repetition yet evading review”
Literally everyone else:
Why the rules exist
Protecting the Monopoly
“The prohibition was not rooted in protecting the public but in economic protectionism.”
Arizona Supreme Court Task Force on the Delivery of Legal Services (2019)
“This protectionistic approach has had catastrophic effects on access to justice.”
Utah Supreme Court Work Group on Regulatory Reform (2019)
