Brief Fact Summary. The parties in this case are former partners/shareholders in a law firm in a dispute over the distribution of contingency fees due on cases that were pending at the time the John F. Gallant, (Defendant) and other lawyers, left the law firm. Lampert, Hausler & Rodman, P.C., (Plaintiff), moves for partial summary judgment.
Synopsis of Rule of Law. A lawyer shall not participate in offering or making an agreement in which a restriction on the lawyers’ right to practice is part of the settlement of a controversy.
The strong public interest in allowing clients to retain counsel of their choice outweighs any professional benefits derived from a restrictive covenant.View Full Point of Law
Issue. Whether enforcement of the fiduciary duty between shareholders demands restricting Defendant from the improper solicitation of clients.
Held. No. The court will enforce the fiduciary duties between shareholders of Plaintiff generally but deny enforcement of those duties as would prohibit any shareholder from practicing law.
Discussion. The courts have generally declined to enforce forfeiture provisions. Such provisions discourage client free choice by encouraging a lawyer who leaves a firm not to compete. Therefore the court will enforce the fiduciary duties between the shareholders except insofar as they may otherwise prohibit any of the shareholders from practicing law.