I
wrote
yesterday
about
the
Puerto
Rico
Supreme
Court’s
adoption
of
the
duty
of
technology
competence,
done
as
part
of
its
promulgation
of
new
rules
of
professional
conduct
to
replace
a
code
of
ethics
that
had
governed
lawyers’
professional
conduct
in
Puerto
Rico
since
1970.
While
Puerto
Rico
modeled
its
new Rules
of
Professional
Conduct
on
the
American
Bar
Association’s
Model
Rules,
it
diverged
from
the
ABA
in
two
significant
respects.
One,
as
I
explained
in
yesterday’s
post,
was
to
add
a
separate
rule
devoted
to
the
duty
of
technology
competence,
rather
than
address
the
duty
through
a
comment
to
the
general
rule
on
competence,
as
the
ABA
does.
The
other
—
and
potentially
more
significant
—
divergence
was
to
revise
Rule
5.4
to
allow
non-lawyers
to
have
ownership
interests
in
law
firms.
Until
now,
only
Arizona
and
the
District
of
Columbia
have
allowed
non-lawyer
ownership
of
law
firms.
D.C.
has
allowed
this
since
1991,
and
Arizona
eliminated
the
ban
on
non-lawyer
ownership
in
2020.
Utah
also
allows
non-lawyer
ownership,
but
only
of
entities
approved
within
its
regulatory
“sandbox”
program.
Puerto
Rico’s
Rule
5.4
Puerto
Rico’s
new
conduct
rules
retain
Rule
5.4’s
general
prohibition
against
a
lawyer
sharing
fees
with
a
non-lawyer.
But
with
respect
to
ownership,
it
adds
a
new
section
(b)
that
reads
as
follows
(translation
via
ChatGPT):
(b)
A
legal
practitioner
may
practice
in
a
law
office
where
an
ownership
interest
is
held
by
a
non-lawyer
only
if:
The
law
office
provides
for
the
collective
fulfillment
of
the
responsibility
to
offer
free
legal
services
to
indigent
persons;Every
non-lawyer
with
an
ownership
interest
must
ensure
that
the
office
is
operated
only
by
persons
admitted
to
the
legal
profession
in
Puerto
Rico.
The
legal
practitioner
must
represent
the
non-lawyer
owner
in
exercising
all
voting
rights
and
all
other
matters
related
to
the
law
office.
They
must
also
ensure
compliance
with
the
rules
of
professional
responsibility
and
notify
the
Supreme
Court
once
the
arrangement
begins.
By
January
15
of
each
year,
they
must
file
with
the
Clerk
of
the
Supreme
Court
of
Puerto
Rico
an
affidavit
stating
the
number
of
attorneys
in
the
firm,
the
dates
and
amounts
of
all
investments
made
by
the
non-lawyer
owner,
and
the
profits
received
by
that
person
in
the
previous
calendar
year;Neither
the
non-lawyer
owner
nor
any
designated
agent
shall
engage
in
the
unauthorized
practice
of
law.
Additionally,
the
only
value
provided
by
the
non-lawyer
owner
in
exchange
for
their
ownership
interest
must
be
money,
and
the
owner
or
their
agents
shall
not
provide
any
services
to
the
law
office,
including
but
not
limited
to
marketing
services;The
non-lawyer
owner
shall
not
interfere
with
the
independent
professional
judgment
of
the
legal
practitioner
or
the
attorney-client
relationship;Information
relating
to
the
representation
of
a
client
shall
be
protected
as
required
by
Rule
1.6;The
arrangement
described
in
subsection
(2)
shall
not
contravene
Rule
1.5;The
legal
practitioner
informs
the
client
that
an
ownership
interest
in
the
law
office
is
held
by
a
non-lawyer;
andNon-lawyer
owners
may
acquire
no
more
than
49%
of
the
shares
of
the
law
office.
Not
Supported
By
Rules
Committee
Although
the
overall
development
of
the
new
conduct
rules
was
accomplished
through
the
work
of
a
special,
court-appointed
committee,
that
committee
had
not
recommended
this
change
to
Rule
5.4.
The
Supreme
Court
did
not
provide
a
rationale
or
explanation
of
its
decision
to
change
the
rule
on
non-lawyer
ownership.
However,
it
did
say
that
it
will
conduct
an
evaluation
of
the
new
rule’s
effectiveness
three
years
after
it
takes
effect.
The
court
assigned
the
task
of
conducting
that
assessment
to
the
same
committee
that
drafted
the
recommended
rules,
now
renamed
as
the
Committee
on
Rules
of
Professional
Conduct.
One
Justice
Dissented
While
the
court
did
not
elaborate
on
its
reasons
for
adopting
the
new
Rule
5.4,
one
member
of
the
court,
Associate
Justice
Luis
F.
Estrella
Martínez,
wrote
a
detailed
dissent
discussing
various
components
of
the
new
conduct
rules,
including
Rule
5.4.
Justice
Estrella
Martínez
wrote
that
he
did
not
agree
with
this
change
“due
to
the
potentially
harmful
consequences
it
may
bring.”
(Here
again,
translations
are
via
ChatGPT.)
“[A]llowing
this
source
of
funding
in
Puerto
Rico
law
firms
could
represent
a
significant
risk
to
the
autonomy
and
independence
of
the
professional
judgment
of
the
attorneys
within
them,”
he
wrote.
Justice
Estrella
Martínez
expressed
concern
that
investors
in
law
firms
would
typically
be
driven
by
purely
economic
interests,
“which
does
not
guarantee
an
improvement
in
the
availability
or
quality
of
legal
services
for
the
people
of
Puerto
Rico.”
He
also
raised
the
concern
that
the
court
lacks
disciplinary
authority
over
investors
who
are
not
attorneys.
“As
a
result,
such
investors
could
influence
legal
decisions
without
being
subject
to
the
same
ethical
and
professional
responsibilities
as
attorneys,”
he
wrote.
While
acknowledging
the
models
adopted
in
Arizona,
D.C.,
and
Utah,
he
thought
Puerto
Rico
should
have
waited
to
observe
their
experiences
before
adopting
this
change.
“So
far,
we
have
not
seen
these
sectors
partner
with
law
firms
to
litigate
on
behalf
of
the
environment
or
vulnerable
populations,”
he
wrote.
“We
must
not
allow
the
principle
of
access
to
justice
to
be
used
as
a
pretext
to
perpetuate
inequality
or
to
excessively
commercialize
the
practice
of
law.”
(Here
is
the
full,
translated
text
of
the
portion
of
the
dissent
that
addresses
Rule
5.4.)