The economic climate that existed in Silicon Valley in the mid to late 1990’s made prevalent the practice of receiving equity in a client in lieu of a legal fee, i.e. prospecting. This practice potentially impacts three of the Model Rules of Professional Conduct: 1.8(a), 1.7(b), and 1.5. None of these Rules gives the lawyer clear guidance in this situation. Because this arrangement has become an accepted alternative billing practice, this Comment proposes two amendments to the Model Rules to more clearly address the issues that arise when a lawyer accepts shares of stock in lieu of a legal fee.
Tony Goodman, The California Gold Rush and the Model Rules: Do the Prospectors Have Sufficient Guidance?, 1 J. Marshall Rev. Intell. Prop. L. 109 (2001)