These summaries were prepared by McGuireWoods LLP lawyer Thomas E. Spahn. They are based on the letter opinions issued by the Virginia State Bar. Any editorial comments reflect Mr. Spahn's current personal views, and not the opinions of the Virginia State Bar, McGuireWoods or its clients. 
 
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  Topic: 42 - Payments to Solicit Recommendations
LEO NumTopicsSummaryDate
1380

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38-Fee Splitting

42-Payments to Solicit Recommendations

45-Law Firms - Miscellaneous

55-Firm Names and Letterhead

[WITHDRAWN 9/16] Although the Bar cannot determine if two affiliated professional corporations are a single entity for purposes of the ethics rules, a determination that they are two separate entities might mean that they are violating: the fee-splitting rules; the prohibition on paying compensation to recommend employment; the ban on using the name of a lawyer who has left the firm and is engaged in business elsewhere.11/30/1990
0821

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13-Marketing - Miscellaneous

42-Payments to Solicit Recommendations

[WITHDRAWN 9/16] Lawyers who are not acting as partners may not circulate publications that imply a partnership arrangement, and may not pay a firm to recommend it in a brochure.9/19/1986
1676

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8-Bills and Fees

13-Marketing - Miscellaneous

38-Fee Splitting

42-Payments to Solicit Recommendations

A collections lawyer may not pay a percentage of the lawyer's fee to a company that offers an electronic communications system to facilitate the collections, because it would amount to impermissible fee-splitting with a non-lawyer. This rule would also apply if the company referred collections clients to the lawyer. 5/16/1996
1735

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8-Bills and Fees

11-"Of Counsel" Relationship

38-Fee Splitting

42-Payments to Solicit Recommendations

45-Law Firms - Miscellaneous

A law firm may employ independent contractor lawyers under the following conditions: whether acting as independent contractors, contract attorneys or "of counsel," the lawyers must be treated as part of the law firm for confidentiality and conflicts of interest purposes; the firm must advise clients of any "mark-up" between the amount billed for the independent contractor lawyers' services and the amount paid to them if "the firm bills the amount paid to the Attorney as an out-of-pocket expense or disbursement," but need not make such disclosure to the clients if the firm bills for the lawyers' work "in the same manner as it would for any other associate in the Firm" and the independent contractor lawyer works under another lawyer's "direct supervision" or the firm "adopts the work product as its own;" the independent contractor lawyers may be designated as "of counsel" to the firm if they have a "close, continuing relationship with the Firm and direct contact with the firm and its clients" and avoid holding themselves out as being partners or associates of the firm; the firm must disclose to clients that an independent contractor lawyer is working on the client's matter if the lawyers "will work independently, without close supervision by an attorney associated with the Firm," but need not make such disclosure (and obtain consent)if the "temporary or contract attorney works directly under the supervision of an attorney in the Firm;" the firm may pay a "forwarding" or "referral" fee to the independent contractor lawyers for bringing in a client under the new Rules.10/20/1999
1632

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13-Marketing - Miscellaneous

17-Fraud on the Tribunal

21-Reporting Another Lawyer's Unethical Conduct

31-Protecting and Disclosing Confidences and Secrets

42-Payments to Solicit Recommendations

50-Lawyer-Owned Businesses

A law firm may not pay a service fee to a so-called "lender service bureau" in return for obtaining legal work from the bureau. Because the bureau apparently is not engaging in fraud against a tribunal, however, the law firm is not obligated to disclose the bureau's operations to the proper authorities. If the law firm determines that the possible misconduct of lawyers holding an "ownership or management interest" in the bureau meets the proper standards, the misconduct would have to be reported. 2/7/1995
0806

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28-Law Firm Staff

42-Payments to Solicit Recommendations

A law firm may pay secretaries a bonus based on the firm's profitability. 6/25/1986
1295

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13-Marketing - Miscellaneous

42-Payments to Solicit Recommendations

A lawyer may accept clients who contacted the lawyer based on the recommendation of prison inmates, as long as the lawyer has not compensated the inmates or engaged in false advertising. 11/21/1989
1374

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13-Marketing - Miscellaneous

31-Protecting and Disclosing Confidences and Secrets

42-Payments to Solicit Recommendations

85-Business Cards

A lawyer may accept referrals from a mental health therapist as long as the lawyer maintains total loyalty to the client and does not reveal any client confidences without consent. The lawyer may also leave business cards at the therapist's office as long as they are truthful and the lawyer does not compensate the therapist. 9/13/1990
0875

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13-Marketing - Miscellaneous

42-Payments to Solicit Recommendations

A lawyer may market a pre-paid legal service plan through non-lawyers who receive commissions for subscribers. 1/30/1987
0387

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13-Marketing - Miscellaneous

38-Fee Splitting

42-Payments to Solicit Recommendations

76-Trust and Estate Lawyers

A lawyer may not discount fees for preparing a will contingent on the client's contributing money to a charity which advertises the lawyer's services. 9/12/1980
1572

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13-Marketing - Miscellaneous

38-Fee Splitting

42-Payments to Solicit Recommendations

83-Solicitation

A lawyer may not engage in an arrangement with a non-lawyer under which the non-lawyer refers cases to the lawyer, assists in helping the lawyer for a fee and in personal injury cases receives a percentage of the client's recovery. The arrangement impermissibly involves a lawyer: (a) paying the non-lawyer a referral fee for soliciting clients and; (b) splitting fees with a non-lawyer. 2/8/1994
0609

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38-Fee Splitting

42-Payments to Solicit Recommendations

A lawyer may not share fees with a non-lawyer intermediary who recommends the lawyer's employment. 11/14/1984
0984

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42-Payments to Solicit Recommendations

84-Direct Mail Marketing

A lawyer may pay an auto body shop or tow truck operator for a list of their clients so the lawyer may send solicitation letters to them, because the body shop and tow truck operator would not be recommending the lawyer in return for payment. 10/27/1987
0539

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42-Payments to Solicit Recommendations

58-Real Estate Lawyers

A lawyer may represent a party in a real estate settlement upon recommendation of a real estate firm, as long as the client consents to the arrangement and is free to hire any lawyer. [The lawyer would be prohibited from giving the real estate firm anything of value in return for this recommendation.] 1/18/1984
0682

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42-Payments to Solicit Recommendations

85-Business Cards

A lawyer must account to a client upon request for any fees paid for future services. 4/10/1985
0207

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42-Payments to Solicit Recommendations

A lawyer who is referred clients by a developer may not refund to the developer a portion of the lawyer's fee. 7/28/1970
0512

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42-Payments to Solicit Recommendations

A mediation and counseling service may refer clients to a law firm, but the law firm may not pay a referral fee to the service. 4/28/1983
1073

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13-Marketing - Miscellaneous

42-Payments to Solicit Recommendations

58-Real Estate Lawyers

A real estate developer may advise buyers that it will deduct $500 from closing costs if the buyer uses a designated lawyer, because the offer is not false or misleading. [This arrangement would violate Rule 7.3(a) if the lawyer gives "anything of value" to the developer. Although the Bar did not address this possibility, it seems unlikely that the developer would enter into this arrangement unless it received something in return from the lawyer.] 6/8/1988
1035

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13-Marketing - Miscellaneous

38-Fee Splitting

42-Payments to Solicit Recommendations

An arrangement under which a lawyer would join a trade and barter association would violate the fee-splitting roles if the lawyer shared 10% of the lawyer's fee with the association, because the 10% fee would be seen as compensation for the referral. [Rule 1.5(e) does not require that a lawyer sharing in fees also share responsibility, thus allowing "referral fees" if the client consents after full disclosure.]2/19/1988

Copyright 2000, Thomas E. Spahn