Final submissions will be made this week in a landmark legal action which experts believe could open up the US legal market to alternative business structures.

Personal injury firm Jacoby & Meyers has filed lawsuits in New York, New Jersey and Connecticut to change rules of professional conduct which bar investment from non-lawyers.

The challenge has already met opposition from the New York State Attorney General’s office, which claimed the existing rules ensure ethical conduct and lawyers’ independence.

Lawyers acting for the firm have filed a brief in response to the attorney general’s attempt to dismiss the action, arguing that there exists a constitutional right to invite investment from non-lawyers.

They also claim the ban has restricted capital for technology upgrades and expansion, and hampered the provision of legal services for the firm’s lower-income clients.

Jeffrey Carton, of Meiselman, Denlea, Packman, Carton & Eberz, which is acting for Jacoby & Meyers, told the Gazette: ‘This change could be enormous at every level all the way from sole practitioners to multi-million-pound law firms.

‘At present external investment is allowed to a limited extent in North Carolina and the District of Columbia, but if the three states lift the restrictions the other 47 will fall like a pack of cards.

‘It’s naive to think that a lawyer’s independence and judgement will be compromised by allowing non-lawyer investment. You can put in the safeguards necessary to ensure there is not a problem - this notion that everyone will start practising purely for the share price and be damned with client confidence is fanciful.’

A judgment in the case is expected within six months.

The issue of reform has been on the agenda in the US for some time, with the American Bar Association’s Commission for Ethics announcing earlier this year it would assess the need for ABS-style reforms and how they might be implemented.

Carton said US lawyers are monitoring the UK’s market liberalisation closely.

‘We’ve been impressed by the robust nature of the debate and by the rules that have been implemented,’ he added.

‘We’re very interested in monitoring how it evolves and how it unfolds and whether the safeguards are sufficient. I think they will be and that much of the hysteria will be for nought.’