IllinoisHB5487104th General Assembly (2025–2026)HouseWALLET

LAW FIRM OWNERSHIP

Sponsored By: Sponsor information unavailable

Became Law

Summary

Amends the Attorney Act. Prohibits a private equity group, hedge fund, or any entity owned, operated, or controlled by a private equity group or hedge fund, including management services organizations, that is involved with a law firm or an attorney's practice from: (1) interfering with the professional judgment of attorneys in representing clients; (2) exercising control over or being delegated the power to own or determine the content of client records, select, hire, or terminate the employment of attorneys or allied legal staff in whole or in part based on competency or proficiency; or set competency or proficiency parameters for attorneys or allied legal staff; or (3) charging any fee to the attorney or law firm that is directly or indirectly based on the fees, revenues, or profits of the attorney or law firm. Prohibits an attorney from sharing legal fees directly or indirectly with an out-of-state alternative business structure unless: (1) the attorney is also licensed in the state in which the alternative business structure is approved; (2) the fees are compensation for providing legal services in that state; and (3) the law of that state is controlling under the Illinois Rules of Professional Conduct or a successor rule. Provides for the recovery of statutory damages, attorney's fees and costs, and injunctive or declaratory relief as a remedy for violation. Defines terms. Contains applicability provisions. Effective immediately.

judiciary - civilassignmentsjudiciary

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 0 benefits, 1 costs, 3 mixed.

Strong penalties for breaking these rules

Violations can lead to ARDC discipline. You owe $10,000 per violation or three times the client’s actual damages, whichever is larger. You can also be ordered to pay the client’s attorney’s fees and costs. Courts can issue injunctions or declaratory orders against you.

Limits on non-lawyer control and contracts

Non-lawyer-owned companies involved with a firm cannot direct legal work, control client files, hire or fire lawyers, or set lawyer or staff performance rules. They also cannot charge fees based on a firm’s fees, revenue, or profit. Normal loan repayment is allowed only if payments are not tied to the firm’s financial results. If you have a management services deal, you must disclose it and its key terms in every client contract. These contracts cannot include noncompetes or gag clauses against attorneys or allied legal staff.

Who these law firm rules cover

This law applies to Illinois-licensed attorneys and firms with under $300,000,000 in global legal revenue, including affiliates. It also applies if more than 50% of your revenue came from contingency fees in each of the last three years. The ARDC or a court can require a sworn self-certification of these facts. The rules only cover contracts signed on or after the law takes effect.

Limits on out-of-state fee sharing

Illinois lawyers cannot share legal fees with a non‑lawyer‑owned legal business in another state unless they are also licensed there, the fees pay for work done there, and that state’s law controls under Rule 8.5. Court‑approved or ordered fee sharing is allowed, including common benefit funds in coordinated or multidistrict cases, when the court oversees the split and finds it fair, reasonable, and necessary.

Sponsors & Cosponsors

Sponsors

There is no primary sponsor on record.

Cosponsors

  • Abdelnasser Rashid

    Affiliation unavailable

  • Diane Blair-Sherlock

    Affiliation unavailable

  • Emanuel "Chris" Welch

    Affiliation unavailable

  • Jay Hoffman

    Affiliation unavailable

  • Jennifer Gong-Gershowitz

    Affiliation unavailable

  • Kevin John Olickal

    Affiliation unavailable

  • Lilian Jiménez

    Affiliation unavailable

  • Mary Beth Canty

    Affiliation unavailable

  • Michael E. Hastings

    Affiliation unavailable

  • Robert Peters

    Affiliation unavailable

  • Suzanne M. Ness

    Affiliation unavailable

  • Will Guzzardi

    Affiliation unavailable

Roll Call Votes

All Roll Calls

Yes: 411 • No: 197

House vote 5/31/2026

Senate Floor Amendment No. 2 House Concurs

Yes: 75 • No: 39 • Other: 1

House vote 5/31/2026

Senate Floor Amendment No. 3 House Concurs

Yes: 75 • No: 39 • Other: 1

House vote 5/31/2026

Senate Floor Amendment No. 3 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee;

Yes: 13 • No: 7

House vote 5/31/2026

Senate Committee Amendment No. 1 House Concurs

Yes: 75 • No: 39 • Other: 1

House vote 5/31/2026

Senate Floor Amendment No. 2 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee;

Yes: 13 • No: 7

House vote 5/31/2026

Senate Committee Amendment No. 1 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee;

Yes: 13 • No: 7

Senate vote 5/30/2026

Third Reading - Passed;

Yes: 39 • No: 19

Senate vote 5/29/2026

Senate Floor Amendment No. 2 Recommend Do Adopt Judiciary;

Yes: 5 • No: 3

Senate vote 5/6/2026

Do Pass as Amended Judiciary;

Yes: 8 • No: 1

House vote 4/9/2026

Third Reading - Short Debate - Passed

Yes: 70 • No: 36 • Other: 1

House vote 4/8/2026

House Floor Amendment No. 2 Recommends Be Adopted Rules Committee;

Yes: 5 • No: 0

House vote 3/25/2026

Do Pass as Amended / Short Debate Judiciary - Civil Committee;

Yes: 20 • No: 0

Actions Timeline

  1. Public Act . . . . . . . . . 104-0801

    8/7/2026House
  2. Effective Date August 7, 2026

    8/7/2026House
  3. Governor Approved

    8/7/2026House
  4. Sent to the Governor

    6/26/2026House
  5. Passed Both Houses

    5/31/2026House
  6. House Concurs

    5/31/2026House
  7. Senate Floor Amendment No. 3 House Concurs 075-039-001

    5/31/2026House
  8. Senate Floor Amendment No. 2 House Concurs 075-039-001

    5/31/2026House
  9. Senate Committee Amendment No. 1 House Concurs 075-039-001

    5/31/2026House
  10. Senate Floor Amendment No. 3 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee; 013-007-000

    5/31/2026House
  11. Senate Floor Amendment No. 2 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee; 013-007-000

    5/31/2026House
  12. Senate Committee Amendment No. 1 Motion to Concur Recommends Be Adopted Judiciary - Civil Committee; 013-007-000

    5/31/2026House
  13. Senate Floor Amendment No. 3 Motion to Concur Rules Referred to Judiciary - Civil Committee

    5/30/2026House
  14. Senate Floor Amendment No. 2 Motion to Concur Rules Referred to Judiciary - Civil Committee

    5/30/2026House
  15. Senate Committee Amendment No. 1 Motion to Concur Rules Referred to Judiciary - Civil Committee

    5/30/2026House
  16. Senate Floor Amendment No. 3 Motion to Concur Referred to Rules Committee

    5/30/2026House
  17. Senate Floor Amendment No. 2 Motion to Concur Referred to Rules Committee

    5/30/2026House
  18. Senate Committee Amendment No. 1 Motion to Concur Referred to Rules Committee

    5/30/2026House
  19. Senate Floor Amendment No. 3 Motion Filed Concur Rep. Jennifer Gong-Gershowitz

    5/30/2026House
  20. Senate Floor Amendment No. 2 Motion Filed Concur Rep. Jennifer Gong-Gershowitz

    5/30/2026House
  21. Senate Committee Amendment No. 1 Motion Filed Concur Rep. Jennifer Gong-Gershowitz

    5/30/2026House
  22. Placed on Calendar Order of Concurrence Senate Amendment(s) 1, 2, 3

    5/30/2026House
  23. Arrived in House

    5/30/2026House
  24. Third Reading - Passed; 039-019-000

    5/30/2026Senate
  25. Placed on Calendar Order of 3rd Reading

    5/30/2026Senate

Bill Text

  • Engrossed

  • Enrolled

  • House Amendment 1

  • House Amendment 2

  • Introduced

  • Senate Amendment 1

  • Senate Amendment 2

  • Senate Amendment 3

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