Selling Sanctuary

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Are you corporate counsel based in Illinois?  Are you admitted to the Illinois bar?  Are you complying with Supreme Court Rule 716?  If not, now is the time for you to act!

The Illinois Supreme Court requires all in-house counsel based in Illinois who are not Illinois-licensed attorneys, to follow Supreme Court Rule 716 and possess a limited law license.  This requires in-house counsel to pay an annual registration fee, pass a background check, submit to the disciplinary authority of the Illinois ARDC, meet the CLE requirements imposed on all practicing lawyers, and be in good disciplinary standing before the highest court of every jurisdiction in which that counsel is admitted.

In-house lawyers coming from other jurisdictions may be unaware of this rule, and fail to timely apply for a limited law license.  Acknowledging that problem, the Illinois Supreme Court has instituted a one year amnesty program, which allows in-house counsel to apply for a limited law license without facing discipline for practicing law unlicensed in Illinois after failing to timely apply.  In-house counsel who apply for a limited law license in the year 2014 must comply with the requirements of Rule 716, but will not face prosecution or discipline for unauthorized practice of law in Illinois prior to counsel’s application.

In addition, during this amnesty period, new applications will not have to pay in arrears for licensing fees or make up CLE credits.  Furthermore, attorneys who have practiced with in-house counsel now seeking amnesty will not be investigated by the ARDC for his or her connection with the in-house counsel’s failure to procure a limited law license.  However, the amnesty program is not completely painless: in addition to the usual application fee of $1,250 required under Rule 716, attorneys filing under the amnesty program must also pay a late registration penalty of an additional $1,250.

Why is this so crucial?  Failure to apply for a limited law license not only exposes you to a prosecution for unlicensed law practice, but can expose your client’s privileged documents as well.  In Gucci America, Inc. v. Guess?, Inc., a magistrate judge ordered privileged documents be produced because Gucci’s in-house counsel had not maintained a valid law license.  (No. 09 Civ. 4373), 2010 WL 2720079 (S.D.N.Y. June 29, 2010). Ultimately the district judge overturned the ruling, but not without costly litigation.  (No. 09 Civ. 4373), 2011 WL 9375 (S.D.N.Y. Jan. 3, 2011).  That is not a risk you or your client wants to take.

Noncompliant in-house lawyers can seek sanctuary through 2014.   While filling out the forms, you might want to listen to this tune I remember fondly from my college radio days.  I confess; I’ve never been able to make out the words, so it just might be about ARDC compliance.