Wednesday, November 17, 2010

Wisconsin Bar: Ethics Opinion on Referral Fees

At the October ABA Ethics 20/20 hearing, several speakers shared opinions lawyer advertising and emerging online referral (and "Yelp-like" networks). The evolution of these new systems creates new opportunities and potential ethical challenges or confusion for the legal industry.

Now comes a revised ethics opinion from the Wisconsin Bar on the issue of referral fees: Wisconsin Formal Ethics Opinion EF-10-02.The update clarifies a past opinion on the same matter, and is well summarized on the State Bar Web Site:
  •  "For instance, the opinion discusses a referring lawyer’s responsibility if concerns arise with respect to the receiving lawyer’s conduct. Lawyers now have more guidance with respect to their ongoing duty as a referring lawyer. But, according to Watson, lawyers should pay more attention to that duty."
  • “Caution is required when seeking a referral fee, because by accepting a fee for the referral, you have accepted joint responsibility for the outcome of the case.”

  • "Because the referral fee is justified by the underlying lawyer-client relationship, lawyers may not accept referral fees if the lawyer-client relationship cannot be established."
  • "EF-10-02 reaffirms that lawyers must inform the client that the referring lawyer maintains a lawyer-client relationship with the client, remains ethically and financially responsible, and will be available to the client. But what does that mean? Ethically, the referring lawyer must keep tabs on the status of the matter."

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