What You Need to Know In Order to Sell a Law Practice-Lawyerist

Roy Ginsburg:

For years, selling a law practice was prohibited because ethics regulators believed clients, files, and a firm’s good will were not something that could be sold. This prohibition did not really affect larger law firms, which would just buy out partners, i.e. the partnership would return the percentage of the equity owned by the retiring partner. Smaller law firms were able to “sell” themselves by merging with other firms.

Solos had to be more creative. Selling the firm’s physical fixtures and furnishings for more than their reasonable market value was a common way to get around the prohibition. Another way was to create a sham partnership, in which the departing lawyer received retirement benefits from the new partner. Solos who were unwilling or unable to take advantage of one of those options, would simply give away their clients — or just close up shop.

***

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: