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A bar association publication printed an article written by two lawyers concerning the tax risks assumed by investors in real estate syndicates.
The lawyer-authors of the article are two of the three principals in a company engaged in the public syndication of income-producing properties. The company in question has many investors who are lawyers, accountants, insurance agents and businessmen.
The lawyer-authors request the opinion of this Committee as to whether it would be proper for them to distribute reprints of their article for distribution to investors in the properties syndicated by their company.
The lawyer-authors state that their activities are confined to the business and legal matters pertaining to their company and that the distribution of the reprints would be for informative purposes only and not for advertisement, They state: “We have no interest is, nor do we intend to accept retainers for any type of legal services whatsoever.” They further state that their activities in the real estate Investment field are limited solely and entirely to the operation of their company.
In the opinion of this Committee it would be improper for the two attorneys as principals of their company to distribute among its investors reprints of the published article.
The author-attorneys, in addition to being lawyers, are principals in a company which is in the business of the public syndication of real estate properties and which is said to have many investors. The authors state unequivocally that they “have no interest in, nor do we intend to accept retainers for any type of legal services whatsoever.” If indeed the author-attorneys were engaged in the active practice of the law apart from their activities for the company, distribution of reprints of their article might well be deemed to be in contravention of Canon 27 as indirect advertising.
But apart from the indirect advertising aspect, distribution of reprints as contemplated would violate the principle set forth in our Opinion No. 114. There we said; “The advertising of the business (conducted by a lawyer) is not essentially improper, if the advertisement be in such form as to avoid the interpretation that it is a solicitation of professional employment, or the solicitation of business or employment because the advertiser is a lawyer.” (Emphasis supplied.)
Whether designed to or not, the proposed distribution of the published article would tend to increase the investment business of the company (1) because of the professional qualifications of the authors as shown by the content of the article and the fact of its inclusion in a professional publication, and (2) because the tax risks discussed in the article would be a major consideration by any prospective investor.
Dated: November 17, 1960.