By Casey Sullivan

Nov 21 (Reuters) - Personal injury firm Jacoby & Meyers has won its bid to revive a lawsuit challenging a New York ethics rule that bars non-lawyers from taking an ownership stake in law firms.

Jacoby & Meyers, famous for its television advertisements, first challenged the ethics rule, the New York Rule of Professional Conduct 5.4, in May 2011. Federal court Judge Lewis Kaplan dismissed the case in March, holding that the firm lacked standing since it hadn't proved it had been harmed by the rule.

But on Wednesday a three-judge panel of the 2nd U.S. Circuit Court of Appeals held that Jacoby & Meyers could amend the lawsuit to challenge a number of other New York statutes that prohibit non-lawyer ownership and resubmit the complaint to district court.

In the lawsuit, Jacoby & Meyers named as defendants the presiding justices from the state's appellate division, in the First, Second, Third and Fourth Departments, who adopt and oversee rules governing the conduct of lawyers.

In its order, the 2nd Circuit panel, including Walker, circuit Judge Gerard Lynch and district Judge John Gleeson, allowed Jacoby to amend the lawsuit with challenges to other New York statutes, including the Judiciary Law and the Limited Liability Partnership law.

"We see no reason not to remand the case back to the district court, in order to permit the plaintiffs to amend their complaint to name additional state defendants and challenge other provisions of New York law that prohibit non-lawyer investment in law firms," the panel wrote.

James Denlea, a lawyer for Jacoby & Meyers, said he expected to file the amended complaint within 30 days.

A spokeswoman for the New York State Office of the Attorney General declined comment.

New York, like the 49 other states, prohibits non-lawyers from holding a stake in law firms. Washington, D.C., began allowing the practice under certain conditions more than 20 years ago, and many European and other foreign countries, including Australia, permit non-lawyer ownership of law firms.

The case is Jacoby & Meyers Law Offices v. The Presiding Justices of the First, U.S. Court for the 2nd Circuit, No. 12-1377.

For Jacoby: James Denlea of Meiselman, Denlea, Packman, Carton & Eberz.

For the justices: Won Shin, assistant solicitor general, New York State Office of the Attorney General.

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