California Supreme Court Overturns Jewel Doctrine

The Jewel doctrine is no more in California.  In Heller Ehrman v. Davis Wright Tremain, the California Supreme Court held that a dissolved law firm has no property interest in fees generated after dissolution for hourly matters that were in progress when the firm dissolved.  The immediate implication is that a lawyer who leaves a dissolved law firm and takes clients to a new law firm does not have to give back profits earned on those matters at the new firm.  The case also has significant implications for partners departing even when the firm is not dissolving, since it confirms that client matters are not the property of the firm.

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