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Ethics Opinions from the Bar Association of San Francisco

INFORMAL OPINION 1975-1

A firm whose principal office and practice is in another state may ethically maintain an office in California under its out-of-state firm name. With the exceptions noted, the firm may not maintain listings in telephone books, building directories and the like under the out-of-state firm name when none of the lawyers whose names make up the firm name are admitted in California.

QUESTION:

May a firm whose principal office and practice is in another state ethically maintain an office in California under its out-of-state firm name? May the firm maintain listings in telephone books, building directories and the like under the out-of-state firm name when none of the lawyers whose names make up the firm name are admitted in California?

OPINION:
Yes to the first question; no to the second, with the exceptions noted.

DISCUSSION:

The question of interstate law firms opening offices in California has been of concern to the California Bar for a substantial period of time. The Board of Governors of' the State Bar of California worked on new rules of professional conduct and, after a three-year study transmitted a new set of Rules of Professional Conduct to the Supreme Court of California. There was ongoing discussion of this subject, and, as a result, one of the proposed new Rules was withdrawn by the Board of Governors prior to approval of the balance by the Supreme Court. The new Rules were adopted by the Supreme Court and became effective January 1, 1975. With respect to out-of-state firms the new Rules provide as follows:

Rule 2-103(D): A partnership shall not be formed or continued between or among lawyers licensed in different jurisdictions unless all enumerations of the members and associates of the firm on its letterhead under (A)(4) of this rule and in listings permissible under (A)(6) of this rule make clear the jurisdictional limitations on those members and associates of the firm not licensed to practice in all listed jurisdictions, however, the firm name may be used on its letterhead under (A)(4) of this rule and in listings permitted under (A)(6) of this rule so long as (1) each person occupying each office of the firm located in California who shall hold himself out as a member or associate of such firm shall be an active member of the State Bar and (2) each person holding himself out as a member of the firm shall be a bona fide partner in such firm, with a bona fide share in the profits, liabilities, and professional responsibilities thereof and (3) at least one person occupying each office of the firm located in California shall be such a bona fide partner and an active member of the State Bar.

Rules 2-103(A)(4) and (A)(6) are concerned with letterheads and the information they may contain and permissible listings in law lists and legal directories. The result of the adoption of the new Rules is that it is now permissible, and therefore ethical, for an out-of-state law firm to maintain an office in California even though none of the lawyers whose names make up the firm are members of the California Bar.

Similar questions have been considered in the past by other ethics committees and their conclusions form the background for further discussion of the issue. For example, in Opinion No. 295 (June 23, 1966) of the Committee on Legal Ethics of the Los Angeles County Bar Association, it was concluded that it would be improper for a California law firm to include in its firm name the name of an attorney not licensed to practice law in the State of California. In its Opinion No. 293 (December 9, 1965) the Los Angeles County Committee held that a California law firm might not list its name on the stationery, building directory, telephone directory or office door of its out-of-state branch office even though it was ethical for the firm to maintain a branch office and to indicate that there is such an out-of-state branch office and its address and telephone number on the firm's letterhead. In Los Angeles Opinion No. 325, March 23, 1972, the Los Angeles Committee in response to a question concerning the function of a law partnership not all of whose members are members of the California Bar made the following observations:

"Although no question is presented with respect to the firm name, we wish to refer the inquiring attorney to our Opinion No. 295 which holds it improper to include in the firm name of a California partnership the name of a lawyer not a member of the California State Bar. See also ABA Opinion 318."

"The primary interest to be protected is that of the public as well as maintenance of the integrity of the Bar. As stated in ABA Opinion 318, the use of the names of non-California lawyers in firm names could pave the way to systems of "chain store" or "franchise" law firms using the same firm name in a number of different states, to which the firm could gain entry by the simple device of adding a member of the local Bar as a partner."

The Committee on Professional Ethics of the Association of the Bar of the City of New York has considered the question of the use in a partnership name of the name of a lawyer not admitted in New York and it was concluded in its Opinions 684 and 700 that it would be a violation of former Canon 33 to include in the partnership name the name of a person not locally admitted.

The question of firm names in multistate practice was considered exhaustively by the Committee on Professional Ethics of the American Bar Association in Formal Opinion 318 (July 3, 1967). This opinion is based upon the former canons of ethics and in particular Canons 27, 33 and 34. The former canons of course, have now been superseded by the ABA Code of Professional Responsibility which became effective on January 1, 1970. Formal Opinion No. 318 states the following:

"It would be improper to maintain an office in a state under a partnership name which includes the names of partners not licensed to practice in that state, unless such practice is condoned by local custom and usage in the state where the office is to be maintained . This prohibition does not apply to firms engaged exclusively in the practice of one of the specialized services recognized by Canon 27 or the firms maintaining a branch office in Washington, D.C., except in states where such a practice is prohibited by statute. In those exceptional cases, care should be taken to see that the letterheads, listings, and all other representations of the firm name to the public make it clear which members of the firm are licensed to practice only in Washington, or wherever the branch office may be located."

One of the specialties listed in former Canon 27 is that of patent law which the firm making the inquiry practices. New York City Opinion 684 is referred to in ABA Opinion 318 for the proposition that the New York opinion recognizes a distinction between a firm engaged in general practice and one practicing patent law exclusively. However, a close analysis of New York Opinion 684 indicates that the question posed to the Committee stated that the practice of the patent firm was "confined to Patent Office matters and Federal Court litigation in regard to patents, trademarks, copyrights, and similar matters." It is the understanding of this Committee that while patent lawyers typically do engage in practice before the Patent Office and engage in litigation in the Federal Courts in connection with matters under Federal jurisdiction, they also are engaged as well in State courts and in counseling clients on matters other than patents, trademarks, and copyrights, cf. Sperry v. Florida, 373 U.S. 379 (1963). It is thus the opinion of this Committee that patent lawyers in California, in their activities as California lawyers, should not be treated differently from California lawyers who do not engage in the practice of patent law. Thus, the opinion of this Committee as expressed above is based upon general principles and not on any distinctions as to the kind of practice in which the firm is engaged.

In Informal Opinion 1165, August 9, 1970, the standing Committee on Ethics and Professional Responsibility of the American Bar Association suggested that the language of Formal Opinion 318, which has been quoted above, has been overruled by DR 2-102(D) of the new Code of Professional Responsibility. DR 2-102(D) provides as follows:

"A partnership shall not be formed or continued between or among lawyers licensed in different jurisdictions unless all enumerations of the members and associates of the firm on its letterhead and in other permissible listings make clear the jurisdictional limitations on those members and associates of the firm not licensed to practice in all jurisdictions; however, the same firm name may be used in each jurisdiction."

The language of DR 2-102(D) has been adopted essentially in toto by the Board of Governors and the Supreme Court. Thus California practice will now be in closer conformity to that permissible under the ABA Code. The question as to whether or not the out-of-state firm may maintain an office in California under its out-of-state name must therefore be answered affirmatively. But there remains the second question as to what kind of listings of the firm are permissible.

As noted above, this opinion is based upon general principles and is applicable to general law firms as well as patent law firms practicing in the State of California. With respect to the five specific acts outlined in the request letter to the Committee, it is the opinion of the Committee that the following would be unethical under the general principles discussed above. They are:

  1. Listing the firm name under "attorneys" in the classified section of the San Francisco telephone book.
  2. Listing the firm name under "patent lawyers" in the classified section of the San Francisco telephone book.

The question of the listing of the firm in the alphabetical listing (white pages) of the local telephone directory would appear to be similar to that of the question of listings in building directories. It would be incongruous if a firm could ethically maintain an office in California and staff it with a partner who is a member of the California Bar and yet be unable to have its clients find its offices by being denied any kind of listings. It is therefore the opinion of the Committee that the out-of-state firm name may be listed in the building directory and on its office door and in the telephone company directory alphabetical listing (white pages) only if there is no identification of the firm as attorneys, lawyers, or patent lawyers.

Under these same principles, the firm could continue to list its branch offices on its letterhead in the manner it is now doing. The conclusion of Los Angeles County Opinion 293, December 9, 1965 which specifically states that a California firm may not, on its branch office, have the California firm name appear on stationery, building directory, telephone directory or office door of the out-of-state branch office appears to be contrary to this Committee's opinion. This Committee believes that the adoption of the new Rules by the Supreme Court now requires a different result. Also see the informal opinion of this Committee, 1974-1, with respect to a California firm functioning ethically in opening a Washington, D.C. office and listing non-California lawyers on its letterhead with appropriate identification but only if the firm is a partnership.

 

All opinions of the Committee are subject to the following disclaimer:
Opinions rendered by the Ethics Committee are an uncompensated service of The Bar Association of San Francisco. Opinions are advisory only, and no liability whatsoever is assumed by the Committee or The Bar Association of San Francisco in rendering such opinions, and the opinions are relied upon at the risk of the user thereof. Opinions of the Committee are not binding in any manner upon the State Bar of California, the Board of Governors, any disciplinary committee, The Bar Association of San Francisco, or the individual members of the Ethics Committee.

In using these opinions you should be aware that subsequent judicial opinions and revised rules of professional conduct may have dealt with the areas covered by these ethics opinions.

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