California Crackdown on Fee Sharing Prompts Firm to Ditch Owners

A new California law has already forced one out-of-state law firm to change its ownership structure.

Eleos LLP, an Arizona firm affiliated with California’s Wisner Baum, removed non-lawyers from its ownership in order to comply with the law, Wisner Baum senior partner Timothy Loranger said in an interview. The law bans firms in California from sharing fees with other firms that are owned by non-lawyers.

The move is an early example of the law’s impact since taking effect in January on firms operating under relaxed ownership rules in Arizona and a handful of other jurisdictions. Brent Wisner, the managing partner ...