How to Evaluate an MSO Under Ethics Rules
What management-arrangement authorities and Texas Opinion 706 say—and why qualified counsel must apply them to a particular MSO arrangement.
Published 2026-01-15 — Updated 2026-08-27
By Relevant Management Services
RMS provides nonlegal management services and has a commercial interest in the operating models discussed. This is RMS commentary, not an independent external review or legal advice.
When people first hear that an independent law firm obtains business support through a separate management company, the instinct is to ask whether that is allowed. There is no categorical answer: the governing jurisdiction, the documents, and the parties’ actual operation matter. Management and outsourcing arrangements have nevertheless been examined by bar associations and ethics committees for decades.
Long before “MSO” became common terminology, law firms used management and outsourcing arrangements. Historical ethics opinions can be useful context, but they are authority only within their own jurisdictions and factual settings. A lawyer should not assume that an earlier opinion resolves a current arrangement.
Texas Ethics Opinion 706, issued in February 2025, addressed the percentage-of-revenue arrangement presented to the committee and concluded that arrangement was prohibited. The opinion discussed alternatives, but it did not approve every alternative fee structure or every MSO arrangement. Its analysis should be read in full and applied by qualified counsel to the facts and rules at issue.
RMS provides defined nonlegal services for fixed fees or fixed per-seat fees and does not share legal fees or outcomes. RMS does not receive or control client funds, practice law, or control legal decisions. Those are RMS operating boundaries, not a general conclusion about other arrangements.
The practical diligence task is to compare the agreement and operations with the applicable professional-conduct, entity, privacy, and other requirements. Qualified counsel should review the arrangement before it is implemented.
Further Reading
Holland & Knight, "Everything Old Is New Again: Why Law Firm MSOs Fit Comfortably Within Existing Ethics Rules" (Dec. 1, 2025) Texas Professional Ethics Committee Opinion 706 (Feb. 2025)
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