April 28, 2016

Second Circuit extends New York's 154-year-old streak of discrimination against out-of-state lawyers

By Second Circuit extends New York's 154-year-old streak of discrimination against out-of-state lawyers

Last Friday, the Second Circuit upheld a longstanding New York requirement that out-of-state attorneys must maintain a physical office in the state to practice New York law–a requirement not imposed on attorneys who reside within the Empire state.

The 154-year-old office space requirement (N.Y. Judiciary Law § 470) originally worked to exempt adjacent-state commuters from the state’s total ban on nonresident practice of law in New York. That is, attorneys living outside of New York under the old residency requirement were only permitted to practice New York law if they worked in a New York office. The privileges and immunities clause of the Fourteenth Amendment was found to render New York’s residency requirement unconstitutional in 1979, yet the office space requirement for nonresident attorneys–having been severed from the residency requirement in the statute books several decades back–has survived. Perhaps ironically though, a statute that once ameliorated the effect of an unconstitutionally protectionist law now has an unconstitutionally protectionist effect itself.

At least, that’s how pro se plaintiff and attorney Ekaterina Schoenefeld sees it. Schoenefeld, a New Jersey resident, argued that the office space requirement for nonresident attorneys imposes a significant and unjustifiably discriminatory burden and violates the privileges and immunities clause.

In a 2-1 decision, the Second Circuit disagreed. It found plaintiff’s claim lacking for failure to establish a prima facie case of specifically protectionist intent. A strong dissent by Circuit Judge Hall characterized the majority’s standard as “reversing the State’s burden” under the traditional two-step inquiry conducted under the privileges and immunities clause. The majority held that the office space requirement merely “provide[s] [nonresident] attorneys a means to establish a physical presence in the state akin to that of resident attorneys,” but the dissent saw it for what it is: a protectionist relic that “denies nonresident attorneys their constitutionally-protected right to practice law ‘on terms of substantial equality.'”  No word yet on whether Schoenefeld will seek rehearing before the full Second Circuit or certiorari before the Supreme Court.  

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