Law Firm Penalties On Departing Partners Just Got Riskier

Law360 (February 5, 2021, 2:08 PM EST) -- The D.C. Court of Appeals, on Feb. 4, issued an important decision that sharply limits the ability of law firms to penalize departing partners who leave for other law firms and take clients with them.

This decision makes clear that financial penalties violate Rule 5.6(a) of the D.C. Rules of Professional Conduct, since they restrict the lawyer's right to practice, and thus interfere with the client's ability to choose a lawyer.

Even before COVID-19, large law firms were experiencing significant volatility with partners changing firms. COVID-19 has escalated these lateral moves and the resulting economic hit that law firms will suffer....

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