So far, the wave of lawsuits and official action arising out of the stock options backdating scams has focused on the public companies that had provided the benefits.

But questions are now being asked whether the law firms that provided the advice are the next in line.

The grounds for potential liability of law firms are set out here in this McDermott Will & Emery briefing.

"Another wave of backdating lawsuits may be coming: suits against the attorneys and auditors who were consulted on the mechanics and disclosure of the offending options program. This may prove fertile territory because the practice of backdating options may not be wrongful in many instances. It is the failure adequately to disclose, properly account for, and pay taxes as a result of such programs that can transform a permissible method of compensation into a violation of law. Faulty advice on this subject can place the professional advisors in the sights of the issuing companies and their executives under attack, shareholders seeking additional sources of recovery, and regulators attempting to assess blame and create reform.

"A tally of the many legal disciplines involved in stock options programs provides insight into how vulnerable law firms may be. Constructing and implementing a stock options program requires detailed analysis of corporate legal structure, securities law considerations, employee benefits concerns, executive compensation issues, complex tax rules and disclosure obligations. For example, options granted below market value provide the recipient with a financial gain. A company issuing such options must disclose this amount as an additional cost on its financial statements. Failure to do so will result in overstated earnings. Did the lawyers who assisted the company in creating the options plan advise the company that the program will create additional expense and reduce earnings, and that those facts must be timely recognized and disclosed? When attorneys reviewed the company's stock options plans in connection with their opinion letters for plan registration filings with the SEC, did they advise the clients of the required disclosures on this subject?"

It goes without saying that we can expect the companies and their executives to defend themselves by saying they were acting on legal advice. But how involved were the lawyers?

Some law firms played a direct role and did nothing to stop the deals, reports The Recorder.

And according to The Recorder, Palo Alto firm Wilson Sonsini Goodrich & Rosati is right in the middle of the action with a client list that includes companies implicated in backdating. Indeed, Larry Sonsini sat on the boards of companies in trouble, including Brocade Communications and Pixar. The report also details how lawyers like Sonsini made themselves rich when they received the options as compensation.

But the question is whether it's that easy to build a claim against third parties here, an issue examined in the The National Law Journal piece The next backdating target may be firms. You can read it here

While some say it's an avenue worth exploring, others believe it's legally difficult to prove, even if the facts support the case.

No doubt, the regulators will be looking carefully at how much the law firms aided and abetted the scams. But it seems that we could be waiting several before anything near a decent case is made.