Quick Update on the BRB Risk Compensation Survey:

At this point, we’ve had about 50 participants submit about 350 data points on staff roles and compensation levels. Given that were a bit over the halfway point in collection, we’re down from last year (which saw 100+ participants submit data on about 700 positions).

For those who are not participating — opting instead to purchase a report, or pursue access via a sponsor — I want to note that for the 2026/2027 edition prices for non-participating firms are definitely going up. (And moving forward I may take additional steps in terms of what is and is not included in the baseline report…)

This all works best if everyone contributes. (And I’ve been told the tragedy of the commons is wrong.)

The survey closes end of next week. So, let’s go team risk!

Questions? Need help? Reach out!

Otherwise, take the survey: here.

Thanks. And now back to your regular updates.

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David Kluft asks: “Can I still represent my divorce client after I marry her?” —

• “After a FL divorce, there were post-dissolution proceedings between the ex-Wife and ex-Husband regarding their children. While these proceedings were still ongoing, the ex-Wife married her divorce lawyer. The ex-Husband moved to disqualify the lawyer on the basis that he was now a material witness, although he didn’t actually explain what made the lawyer a material witness. The trial court described the case as a ‘train wreck’ and disqualified the lawyer ‘out of an abundance of caution’ because he ‘may’ have unique information and ‘might’ be called as a witness.”
• “On appeal, the District Court of Appeal invoked 3.7, which the trial court didn’t bother looking at. Rule 3.7 requires disqualification of a lawyer when he is a ‘necessary witness’ at trial. Here the ex-Husband had not sufficiently alleged that he was going to call the lawyer as a witness and why, and he offered no argument as to what information the lawyer had that the ex-Wife did not. Therefore, he was not a ‘necessary witness.’ In addition, the disqualification order was too broad because it disqualified the lawyer from representing the ex-Wife at all, and a Rule 3.7 order should be limited to trial.”
• Decision: here.

“Professional responsibility pitfalls from recent Illinois decisions” —

• “In Ordower v. Dalton, the underlying malpractice allegations stemmed from an attorney’s interpretation of a client’s voicemail as a withdrawal from a business transaction. The claimant argued that the attorney proceeded without adequately consulting the client regarding the client’s actual objectives. An ethics expert opined that such conduct violated Rule 1.4, which requires lawyers to reasonably consult with clients concerning the means by which their objectives are to be accomplished.”
• “The same decision also addressed allegations involving an attorney’s acquisition of an ownership interest in a transaction involving a client. The claimant asserted that the attorney’s personal financial interests conflicted with the client’s interests and that the transaction failed to satisfy the disclosure and informed consent requirements governing business transactions with clients.”
• “Rules 1.7 and 1.8 present recurring malpractice risks because they seek to protect clients from divided loyalties. Plaintiffs’ experts often focus heavily on whether disclosures were adequately documented and whether informed consent was obtained. Even transactions that appear beneficial to all participants can become fertile ground for malpractice allegations when the required safeguards are not strictly followed.”
• “For lawyers and law firms, compliance with these rules should never be treated as a technical exercise. Thorough written disclosures and documented client consent remain the best protection against later claims that personal interests compromised professional judgment.”
• “The allegations in Ordower v. Dalton also advanced claims that the attorney engaged in conduct involving dishonesty, fraud, deceit, or misrepresentation under Rule 8.4. While those allegations remained disputed, the case illustrates how quickly a communication or conflict dispute can evolve into accusations of unethical conduct.”

“PE, Hedge Funds Are Barred From Steering Law Firms in California” —

• “Private equity, hedge funds and litigation funders can’t direct or influence law firms they back, according to legislation California law Governor Gavin Newsom (D) has signed into law.”
• “Newsom signed the state legislation (AB 2305) into law Sept. 20, and it will go into effect in January. It targets alternative business structures and management service organizations — two vehicles that allow non-lawyer investment in the legal space. The bill still allows the practice of non-recourse litigation finance as long as funders do not interfere in the practice of law.”
• “Philippa Balestrieri, a corporate M&A partner at Holland & Knight who works on investment structures in the legal industry, said that the law doesn’t restrict MSOs. Rather, it is a restatement of the same concepts that govern the models.”
• “‘I don’t see this as being a kind of watershed moment for the MSO market in California,’ she said. ‘I see this as, if anything, underlining for outside capital the need to hire competent counsel, hire people who know what they’re doing when they’re structuring your deals.'”
• “The bill Newsom signed was sponsored by Ash Kalra, a Democratic member of the State Assembly whose district encompasses most of San Jose. Newsom last year signed a Kalra measure that bans California attorneys and firms from sharing contingency fees with out-of-state alternative business structures.”

New York State Bar: “Ethics Opinion 1302: Provision of Integrated Legal, Tax, and Financial Planning Services” —

• “An attorney’s provision of integrated legal, tax, and financial planning services would, under Rule 5.7 of the New York Rules of Professional Conduct (the ‘Rules’), very likely result in all of such attorney’s services being subject to the Rules.”
• “In determining whether the Rules apply to the nonlegal services, the key factor is the degree of integration of the legal and nonlegal services (i.e., whether or not the legal and nonlegal services are ‘distinct’ or not ‘distinct’).”
• “Providing these integrated services would require consent, confirmed in writing, to a personal interest conflict but that consent would not permit the attorney to receive commissions or similar separate payments for providing financial planning advice. Whether an attorney should practice in a particular organizational form is beyond this Committee’s jurisdiction.”