Making a Lateral Move

Switching law firms is rarely a simple matter. For partners in particular, moving laterally means balancing fiduciary duties, ethical rules, and financial realities all while trying to protect client relationships and personal reputation. A misstep at any stage can cause real harm.

The Market for Lateral Moves

Economic pressures, shifting practice demand, and competitive compensation packages continue to drive lateral movement. In many cases, these shifts are also practice-area specific. For instance, corporate and M&A practices may slow down during economic uncertainty, while litigation, restructuring, and regulatory work may see increased demand. For attorneys considering a move, this means timing can be critical; joining a firm with growth in your practice area may be more valuable than chasing headline compensation numbers. Some lawyers also view lateral movement as a way to access stronger platforms, international reach, or cross-selling opportunities that their current firms cannot offer.

A typical lateral transition involves five broad stages:

Pre-departure issues
Completing the Lateral Partner Questionnaire (LPQ) and interviews
Receipt and negotiation of the offer
Providing Notice to the Firm and Related Issues
Post-departure issues

Each stage brings unique challenges. As Dan Binstock of Garrison explains, “It seems at first like all you need to do is pick up the phone and call someone you know. But it’s not until later that you realize how much more complicated it gets.”

Duties to Firm, Partners, and Clients

Lawyers making a move must navigate multiple fiduciary duties and ethical considerations, including those to their current firm, their partners, and their clients.

When planning a lateral move, it is critical to review the partnership agreement. Typical provisions to be mindful of include the following:

Notice Periods
Non-solicitation Clauses
‘Claw back’ Provisions
Payments to Withdrawing Partners
Return of Capital Payouts
Confidentiality

Beyond the rules themselves, attorneys need to appreciate the practical implications, particularly for their clients. Clients may be in the middle of transactions or litigation, and any disruption can damage both the lawyer’s reputation and the client relationship. Courts and bar associations emphasize that the client’s right to choose counsel must always come first, and any contractual terms that conflict with this principle are viewed with skepticism.

As Brock Naeve of Affirm Partners observes, “Your fiduciary duty to your clients is paramount. That’s your North Star.”

The rules below from the American Bar Association’s (ABA) Model Rules of Professional Conduct are particularly relevant during lateral moves:

Rule 1.4: Duty to Communicate Material Facts to Clients
Rule 1.6: Confidentiality of Information
Rules 1.7 & 1.9: Conflicts with Current and Former Clients
Rule 5.6: Restrictions on the Right to Practice

Tina Solis of Nixon Peabody advises that it is incredibly important to be mindful of Rule 5.6, as this is often tested by firm agreements: “If partnership agreements have restrictive covenants that limit a lawyer’s right to practice and impede a client’s right to choose their counsel, those provisions may be unenforceable.”

Be Mindful of Potential Obstacles

Certain circumstances can raise the stakes dramatically. These situations often create leverage points for both the departing lawyer and the firm. For example, a lawyer with pending receivables or unfinished matters may be pressured to remain longer, while firms facing financial stress may resist releasing capital accounts or lifting guarantee obligations. The terms of your agreements are critical and should be analyzed thoroughly before planning a lateral move. Attorneys in these scenarios are well advised to seek outside counsel familiar with these ethical, fiduciary, and contractual issues to minimize the risk of litigation or disciplinary action.

Communicating With Potential Employers

A critical step in the lateral move process is completing the Lateral Partner Questionnaire (LPQ). This document typically asks about:

Current clients and matters
Conflicts of interest
Book of business and billing rates
Compensation history
References

However, confidentiality rules limit what can be shared. Rule 1.6 of the ABA’s Model Rules of Professional Conduct generally protects client information, though ABA guidance allows disclosure of “the persons and issues involved” for conflict checks under certain conditions.

Alex Edelman of Klein Landau & Edelman, LLC adds perspective from the recruiter side of this process: “We’re in the business of collecting information all day. But I always tell laterals that my reputation depends on protecting confidentiality and giving good advice.”

Compensation and Negotiations

Several states, including California, Illinois, and New York, prohibit employers from asking about salary history during interviews. Others, like Michigan, allow it only after a conditional offer. Compensation structures themselves can vary dramatically from firm to firm, ranging from lockstep models to ‘eat-what-you-kill’ systems, or hybrid approaches. Understanding how origination credit, cross-selling, and overhead allocation work at a prospective firm can have as much impact on long-term earnings as base salary. Moreover, cultural fit around compensation philosophies is critical; misalignment is one of the top reasons laterals become dissatisfied after a move.

Naeve stresses the importance of managing offers carefully: “If you have a great recruiter, you want them involved as early as possible. But a bad one can really muck up the process at any stage.”

For lawyers juggling multiple offers, negotiation strategy is crucial. Transparency about expectations on both sides is key to preventing disputes later.

Notice Considerations

One of the most sensitive questions is who should be notified of your withdrawal first: your current firm or the clients?

The general rule in most jurisdictions is that the firm should be notified before any clients. For example, the guidance in Ohio provides that it is improper for a departing attorney to announce the departure to clients of the firm before the law firm is told. See Supreme Court of Ohio Board of Commissioners on Grievances and Discipline Advisory, Op. 98-5. Courts in New York have taken a similar stance. See e.g., Graubard Mollen Dannett & Horowitz v. Moskovitz, 86 N.Y.2d 112 (N.Y. 1995). Illinois, likewise, follows the majority rule. Dowd & Dowd, Ltd. v. Gleason, 352 Ill. App. 3d 365 (1st Dist. 2004) (holding pre-resignation surreptitious “solicitation” of firm clients for a partner’s personal gain is actionable.).

Jonathan Friedland of Much Shelist, P.C underscores the importance of this process: “Both the departing attorney and the firm have ethical responsibilities to the clients to ensure their representation is not adversely affected.”

Once the firm is notified, best practice is a joint client letter explaining the upcoming departure and the client’s options. If the firm refuses, ethics opinions in multiple states affirm that the departing lawyer can still contact clients independently.

Best Practices for a Successful Transition

A lateral move can open new doors, but it’s not just a career move; it’s a complex legal and ethical process. Transparency, careful planning, and professionalism throughout the process send important signals to both the old and new firms that the attorney is acting with integrity.

When considering a lateral move, remember to:

Plan Ahead: Don’t wait until you’re deep in talks with a firm to bring in recruiters and counsel.
Know Your Agreements: Review partnership and employment contracts early.
Put Clients First: Fiduciary duty to clients is the guiding principle.
Manage Communications Carefully: Follow ethical rules on notice and confidentiality.
Understand Compensation Laws: Stay compliant with state restrictions on salary history.

To learn more about this topic, view The Do’s and Don’ts in Connection with a Lateral Move. The quoted remarks referenced in this article were made either during this webinar or shortly thereafter during post-webinar interviews with the panelists. Readers may also be interested in reading other articles about employment & labor dynamics.

This article was originally published here.