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The American Bar Association took a strong stance against multi-disciplinary practice Tuesday when its House of Delegates voted to “preserve the core values of the profession” by encouraging state bar associations and other agencies that regulate the legal profession to prohibit lawyers from sharing fees with nonlawyers or transferring to nonlawyers ownership or control over law firms. The 314 to 106 vote against multidisciplinary practices, or MDPs, is a blow to the accounting industry and the Big Five accounting firms in particular, which have been expanding into the legal services market overseas and hoping to do so in the United States. “I think it has a negative impact on everyone who wanted to give clients a choice on how professional services are delivered,” said Richard Miller, general counsel of the American Institute of Certified Public Accountants, the leading trade association for CPA’s. He condemned the ABA action as “showing no vision” and demonstrating that the proponents were “more concerned with maintaining their guild” than the delivery of legal services to clients. The vote followed a rigorous debate over whether the ABA should delay action on the MDP issue and a defeated an attempt to substitute a proposal that would have delayed any resolution of the issue until more state and local bar associations had concluded their own studies. The successful proposal, sponsored by Robert MacCrate, a former ABA president, senior counsel at Sullivan & Cromwell and chair of the New York State Bar’s Committee on the Law Governing Firm Structure and Operation, represented a last-minute compromise between several state bar association delegates, including from Illinois, New York and New Jersey, to come up with a unified proposal. MacCrate, who said he was “surprised by the extent of the vote” in favor of his proposal, said the revised proposal was hammered out in “a very directed” effort “to make sure people understood our common ground.” The ABA recommendation urges “each jurisdiction” to “revise its law governing lawyers to implement” the principles of law as an independent profession, a process that could take many months. The recommendation calls upon jurisdictions to retain and enforce laws that generally bar the practice of law by “entities other than law firms,” and calls upon the ABA to study and recommend amendments to the Model Rules of Professional Conduct to “assure there are safeguards … relating to strategic alliances and other contractual relationships with nonlegal professional service providers” consistent with the principles adopted. MacCrate said he believed the ABA action would “have significant impact abroad” because “many foreign jurisdictions have been following very closely what we have been doing” particularly given New York’s status as “the financial center of the world today.” He also said he believes the action will “discourage recruitment” of lawyers “by accounting firms. I think they are going to find that people will be increasingly reluctant to leave law firms to move to accounting firms.” Visit Law.com’s ABA 2000 Convention Coverage

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