When a lawyer leaves a Wisconsin law firm, what do the lawyer and the firm owe to the clients the lawyer was handling?

Plain-English summary

Opinion EF-25-02 (April 17, 2025) sets out the ethical duties of a departing lawyer and the lawyer's firm when the lawyer moves to another firm, and withdraws prior Wisconsin Opinion E-97-02. The committee starts from two principles: no lawyer "owns" a client and clients may discharge a lawyer or firm at any time, so it is not meaningful to think of clients as belonging to either; and, as a consequence, the client is entitled to the file and may direct that it stay with the firm, go to the departing lawyer, or go to new counsel. A lawyer who fails to honor the client's choice of counsel violates SCR 20:1.16(a), and SCR 20:5.6(a) prohibits agreements that restrict a lawyer's right to practice, so there are no enforceable non-competes for lawyers.

The committee walks through the sequence. A lawyer may search for a new job without telling the firm, but substantive employment discussions with an opposing firm create a conflict under SCR 20:1.7(a)(2). The committee concludes a lawyer should inform the firm of an intended departure before notifying clients, grounded in the lawyer's fiduciary duty of honesty to the firm, while recognizing the rules do not strictly require firm-first notice. Under SCR 20:1.4(b), affected clients (those who would reasonably consider the departing lawyer "their" lawyer) must be told of the departure and given enough information to choose among staying with the firm, following the lawyer, or hiring new counsel; a joint communication is recommended but not required, and notices must not disparage, mislead, or pressure the client. If one side refuses to send notice, the other must.

The opinion then details file and money obligations. The file is the client's property; the departing lawyer may not remove client files until the client so directs and the new lawyer assumes responsibility, and the firm must surrender the file (without conditioning it on payment) once the client chooses, consistent with Wisconsin Opinion EF-16-03. Unearned advance fees and client funds must be promptly refunded or held in trust and cannot be used as leverage. On SCR 20:5.6(a), the committee concludes a firm may not impose liquidated damages, fixed exit payments, fee-forfeiture, or notice periods that function as a head start on client retention; it reads the rule to bar financial disincentives to competition even if "reasonable," and treats a 2-to-4-week notice period as generally acceptable subject to those limits. Court-appointed matters (public defender, guardian ad litem) belong to the individual lawyer, not the firm, and are handled accordingly.

In practice

Under this opinion, conduct matching its fact pattern, a lawyer leaving a private firm and a firm responding to that departure, must center on protecting affected clients. The committee holds that both the lawyer and the firm have a duty under SCR 20:1.4(b) to inform affected clients of the departure and their options, that the file and any unearned funds move at the client's direction rather than the firm's, and that a partnership or employment agreement may not restrict the departing lawyer's right to practice or financially penalize a competitive departure under SCR 20:5.6(a). The committee frames cooperation between the firm and the departing lawyer as the best way to satisfy these duties.

Common questions

Q: Does the client "belong" to the firm or to the departing lawyer?

A: Neither. The committee concludes no lawyer owns a client and clients may choose their counsel and discharge a lawyer or firm at any time, so the client decides whether to stay, follow the lawyer, or hire new counsel.

Q: Must a lawyer tell the firm before telling clients about the departure?

A: The committee recommends it. It concludes lawyers should inform the firm of an intended departure before notifying clients, based on the fiduciary duty of honesty to the firm, while noting the rules do not strictly require firm-first notice.

Q: Who gets the client file and when?

A: The client. The committee concludes the file is the client's property; the departing lawyer may not take files until the client directs it, and the firm must surrender the file at the client's direction without conditioning it on payment of fees.

Q: Are non-compete or financial-penalty agreements allowed?

A: No. The committee concludes SCR 20:5.6(a) bars agreements restricting a lawyer's right to practice, including liquidated damages, fixed exit payments, and fee-forfeiture, and reaches notice periods that function as restrictions on competition.

Q: What happens to unearned fees and client funds?

A: They are refunded or protected. The committee concludes unearned advance fees and client funds must be promptly refunded or held in trust under SCR 20:1.16(d) and 20:1.15, and may not be used as leverage in a dispute.

Background and rules framework

The opinion interprets several Wisconsin rules together: SCR 20:5.6(a) / Model Rule 5.6 (no restrictions on the right to practice), SCR 20:1.16 / Model Rule 1.16 (declining or terminating representation, file and fund return), SCR 20:1.4(b) / Model Rule 1.4 (communication with clients), SCR 20:5.1 / Model Rule 5.1 (firm responsibilities), SCR 20:1.6 / Model Rule 1.6 (confidentiality, including the 20:1.6(c)(6) conflict-checking disclosure), and the fee-division and trust provisions SCR 20:1.5(e) and 20:1.15. The committee notes that other bodies of law (employment, partnership, business torts) may also bear on a departure but are outside the scope of an ethics opinion.

Citations and references

Rules of Professional Conduct:

• Wis. SCR 20:5.6(a) / Model Rule 5.6 (restrictions on right to practice)
• Wis. SCR 20:1.16 / Model Rule 1.16 (withdrawal; return of file and unearned fees)
• Wis. SCR 20:1.4(b) / Model Rule 1.4 (communication; client's informed decisions)
• Wis. SCR 20:1.6 / Model Rule 1.6 (confidentiality; conflict-checking disclosure)
• Wis. SCR 20:1.5(e), 20:1.15 / Model Rules 1.5, 1.15 (fee division; trust accounts)

Cases:

• Disciplinary Proceedings against Shea, 190 Wis. 2d 560, 527 N.W.2d 314 (1995), lawyers owe a fiduciary duty of honesty to their firms
• Hackett v. Moore, 939 N.E.2d 1321 (Ohio Ct. Com. Pl. 2010), invalidating a contract requiring a departing lawyer to turn over 95% of fees

Other opinions cited:

• ABA Formal Opinion 489 (2019): notification and resource obligations when lawyers change firms
• ABA Formal Opinion 99-414 (1999): ethical obligations of a lawyer changing firms
• Wisconsin Formal Ethics Opinion EF-16-03 (2016): surrender of the client file on termination

See also

• ABA Formal Op. 489: Notice When Lawyers Change Firms
• ABA Formal Op. 99-414: Ethical Obligations When Changing Firms
• ABA Formal Op. 94-381: Restrictions on the Right to Practice
• ABA Formal Op. 06-444: Restrictive Covenants and Retirement Benefits

Source

• Landing page: https://www.wisbar.org/formembers/ethics/pages/formal-opinions.aspx
• Original PDF: https://www.wisbar.org/formembers/ethics/Ethics%20Opinions/EF-25-02%20Lawyer%20Mobility%20-%20%20FINAL.pdf