Opinion #118. Lawyers with Ownership Interest in Corporation Providing Public Relations Services

Issued by the Professional Ethics Commission

Date Issued: September 13, 1991

Facts

The individual partners of law firm ABC and public relations firm XYZ wish to form a new corporation, PAG. The corporation will provide a broad array of public relations services, including legislative lobbying. The role of the partners of law firm ABC will be limited to that of partial ownership; they will serve as corporate directors, but will not provide any of the services of the new corporation themselves nor will any of the law firm’s associates. In addition, the new corporation itself will employ no lawyers. The law firm has requested the Commission’s opinion whether this arrangement violates Bar Rule 3.2(a)(2). For the reasons which follow, it is the Opinion of the Commission that the rule is not violated.

Opinion

Bar Rule 3.2(a)(2) provides:

A lawyer shall not form a partnership or business corporation with a person not licensed to practice law if any of the activities of the partnership or corporation consist of the practice of law.

In Opinion No. 79, the Commission indicated that the phrase “practice of law” in this Rule

. . . has typically been interpreted as including services in fact performed by lawyers, whenever the business entity in question represents that a lawyer will be performing the service, even though nonlawyers may and do perform the same service.

The rule thus prohibits the formation of corporations by lawyers and non‑lawyers if the corporation will be offering the legal services of those lawyers. The question presented here, however, is whether the rule is violated if the corporation uses non‑lawyers to provide services, such as lobbying, which are sometimes performed by lawyers.

In the opinion of the Commission, the rule would not be violated by this arrangement. As set forth above, the new corporation, PAG, will employ no lawyers, nor will the lawyer partners or associates of law firm ABC perform any work for PAG. Rather, PAG’s clients will be advised that if legal work is necessary, law firm ABC is available to do it. This arrangement does not violate either the letter or spirit of Rule 3.2(a)(2), one of the principal purposes of which is the avoidance of public confusion over the nature of the services provided by the new corporation. See Reporter’s Notes to Maine Bar Rule 3.2(a)(2). So long as none of the lawyers of law firm ABC are involved in the activities of corporation PAG, the Rule is not violated, even if some of the activities of the corporation, such as lobbying, are those which are sometimes performed by lawyers.

This conclusion is not inconsistent with that reached in Opinion No. 79. In that case, the inquiring lawyer indicated that the new corporation owned jointly by two lawyers and an accountant proposed to offer the services of the attorneys and the accountant, who would jointly “provide total legal and financial services,” and that “a named lawyer will be a member of the `team of experts.’” In Opinion No. 79, therefore, it was clear that lawyer‑owners would be involved in the activities of the new multi‑purpose entity, thereby blurring the clear distinction required by the Rule between lawyers providing legal services and non‑lawyers providing services which are sometimes provided by lawyers.


Enduring Ethics Opinion