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                                         2 N.J.L. 253
                                        February 7, 1994

                                        136 N.J.L.J. 570
                                        February 7, 1994

ADVISORY COMMITTEE ON PROFESSIONAL ETHICS

Appointed by the Supreme Court of New Jersey

OPINION 674

Membership in Organization Designed to
Foster Exchange of Referrals Among its Members


    The inquirer seeks to join an organization, the sole declared purpose of which is to exchange referrals among its members. Members are required to pay an annual membership fee and attend weekly meetings. Each member is required to provide at least one "lead" each week for at least one other member. Fines, nominal in sum, are imposed for failure to provide such leads. Organizational literature describes other chapter members as the "sales force" for business leads and access to clients, and expulsion from the organization is recommended for members who fail to provide these leads on a consistent basis.     
    Membership in each chapter is limited to one member from a particular business field. Thus, for example, only one civil practice attorney would be permitted in a chapter, but an attorney with another specialty or area of concentration might be permitted to join the same chapter. By the organization's by-laws, a pre- existing member has an absolute veto over a competitor's membership.

    The inquirer asks whether there is any ethical prohibition to an attorney's membership and participation in this organization.
    In Opinion 539, 114 N.J.L.J. 369 (1984), we expressed the view that it would not be unethical for a law firm to join a professional organization specifically structured to aid its members in the development of sales and marketing leads and contacts for business expansion. We believe, however, that there is a distinction to be drawn from the inquiry addressed in Opinion 539, specifically related to the requirement imposed on members of the organization which is the subject of this inquiry.
    RPC 7.3(d) provides as follows:
        A lawyer shall not compensate or give anything of value to a person or organization to recommend or secure the lawyer's employment by a client, or as a reward for having made a recommendation resulting in the lawyer's employment by a client except that the lawyer may pay for public communications permitted by RPC 7.1 and the usual and reasonable fees or dues charged by a lawyer referral service operated, sponsored or approved by a bar association.
    In Opinion 539, supra, 114 N.J.L.J. 369, we found there was no compensation or thing of value exchanged for a recommendation. The organization referenced in this inquiry, however, requires its members to provide weekly leads and imposes sanctions of fines or expulsion for failure to do so. This, in our opinion, constitutes compensation or furnishing something of value, which is prohibited by RPC 7.3(d). This requirement distinguishes this organization from the associations discussed in Opinion 539, supra, 114 N.J.L.J. 369, and from service clubs for business and professional individuals such as Rotary and Kiwanis.
    In our opinion, therefore, the joining of such an organization by an attorney is prohibited by the Rules of Professional Conduct.

    

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