Ill. Bills Underscore Rising Scrutiny of PE in Legal Sector

Legal ethics attorney Trisha Rich was quoted in a Law360 article summarizing proposed laws in Illinois involving management service organizations (MSOs) and alternative business structures (ABS) in the legal industry. The bills introduced in the Illinois House and Senate on February 6, 2026, would restrict contact between Illinois law firms and ABS firms as well as codify existing state ethics rules that prohibit nonlawyers from interfering with an attorney's professional judgment or law practice management, such as handling client records or making hiring decisions. Supporters contend the proposed legislation will help ensure the focus remains on clients, not profits, and prevent private equity firms and investors from exercising outsize influence on legal decision-making. Ms. Rich, who has advised on dozens of law firm MSO deals, countered that the bills inaccurately define MSOs and mischaracterize the law firm-MSO relationship, adding that they will likely be found unconstitutional because the Illinois Supreme Court has exclusive jurisdiction to regulate attorney conduct.

"I think this bill reflects that people don't truly understand the relationship between an MSO and a law firm," she commented. "In a properly structured MSO/law firm relationship, the firm does remain completely independent."

Ms. Rich also co-authored a Holland & Knight alert on this topic.

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