Discipline for entities? Not the answer to any relevant future questions.

It appears somehow that life and practice left me with nothing to post for more than a week now. If I have any readers left, today’s post will be a relatively quick one.

I managed to write a couple ofposts now about one topic that was covered at the APRL mid-year meeting in Las Vegas earlier this year. In keeping with the spirit of not having things that happen in Vegas stay in Vegas this time around, Jayne Reardon a Chicago lawyer who participated in a different panel discussion has put out a new post about the topic of law firm (or entity) regulation over at the Illinois Supreme Court Commission on Professionalism blog, 2Civility. You can read it here.

Now, I do not disagree that aspects of the trend of entity regulation that is taking place with respect to law firms in other countries may have some utility here in the states IF we were to remove barriers to how lawyers and people without law licenses could work together to practice law. Until that happens, it simply isn’t something that is helpful to addressing actual issues. And particularly not if the focus is on discipline.

As the article does acknowledge, the disciplinary rules already provide a means for having members of management and partners in law firms on the hook for discipline in certain circumstances through RPC 5.1. I consider that tool to be more than enough regulation from the disciplinary side of things for many of the examples that Jayne offers in her article to be addressed.

That being said, I absolutely agree that if we could start to see movement toward a more proactive system — like the PMBR course that Jayne discusses that is being implemented in Illinois – then I’d be all for exploring how to move toward a regulatory framework that looks more toward regulation of the entities in which many lawyers practice than merely targeting individual attorneys for discipline.

But, we don’t. We live in a world in which individual attorneys get targeted for discipline. So, today, I’d suggest we all take some time to listen to what this recently disbarred attorney has to say today.

Lying about everything is an awful way to go about life.

So, I am rapidly approach the 4th anniversary of this blog and this is the very first time I have had a post sharing exactly the same title as an earlier post.

Interestingly (at least to me), that earlier post with that title was written on Groundhog’s Day 2 years ago. The title for this post seemed a fitting title because … well, I think it will be clear when we launch into this – but also referencing back to that older post and it having been a Groundhog’s Day themed post also is pretty appropriate because the pathological nature of the lying of this Chicago lawyer has something of a deja vu sort of feel when compared to the lying of that Michigan lawyer from the prior post.

You’ve probably already read about this story but, if not, this is your window into the story of this Chicago lawyer who has been lying off and on about having cancer for more than a decade, who has lied about having a son, and even lied about the son he never had also having the same kind of cancer that he doesn’t have but has lied about having.

The repeated lying about having leiomyosarcoma, including falsely claiming that his pretend son had the same thing, grabbed the headlines but there were at least two other karma-tempting whoppers over the years, including: Lying to his firm that he had retained an expert but that the expert couldn’t work because his daughter had been hit by a car; and lying about having to attend a funeral in Montreal to get a court extension

There really is not an awful lot I can add to the obvious reasons why this kind of tale of a lawyer going beyond the pale in terms of what they were willing to lie about, and how often they apparently were willing to lie about it, is so disturbing.

One disturbing aspect of the situation is that his lawyer, in an answer filed in the disciplinary proceedings, has said that he came up with the cancer lie because he was actually suffering from depression in 2005 and was afraid to admit to suffering from a mental illness at the time when he was applying to law school. As someone who believes strongly in the fact that our profession needs to do much better about the topic of wellness and who readily recognizes that our profession needs to do all we can to help reduce the stigma surrounding mental health issues in our profession, I’d really like to believe that explanation and be more sympathetic, but when you lie about the really big stuff it is hard not to think that you are lying about your reason for lying.

I particularly have a hard time with achieving a sympathetic point of view after reading this piece of the pleadings in the disciplinary case about this kind of false statement made nearly 11 years after applying to law school:

64. On July 25, 2016 at 9:45 a.m. Respondent sent an email to AUSA Brock, and copied to AUSA Hancock, the following message related to Respondent’s purported reason for requesting an extension to complete discovery in the Harris case: “Yes, all went well. Thanks so much for asking. He has leiomyosarcoma, a form of stomach cancer, and had to have a small portion of his stomach and GI tract removed. It sounds terrible but apparently it is a rare but also highly treatable disease. My fiance and 1 have fostered kids on and off for the last 5 or so years. The only downside is that these incredible kids are often in this situation in the first place because they have one or more serious illnesses/conditions. I normally wouldn’t share such personal information but I really do feel so grateful for yours and Gina’s support last week and think it’s important that you know what it actually meant to me.”

Answer: Admit

65. Respondent’s statements to AUSAs Brock and Hancock, as set forth in paragraph 64, that his son’s surgery went well, that Respondent’s son had leiomyosarcoma which required surgery to remove a small portion of his stomach and GI tract, and that Respondent and his fiance [sic] had fostered children for the last five years were false.

Answer: Admit

66. Respondent knew his statements to AUSAs Brock and Hancock, that his son’s surgery went well, that Respondent’s son had leiomyosarcoma which required surgery to remove a small portion of his stomach and GI tract, and that Respondent and his fiance [sic] had fostered children for the last five years, as set forth in paragraph 64, were false because Respondent had no child or foster child, therefore no diagnosis of leiomyosarcoma, and no surgery.

Answer: Admit

But the part of this whole thing that really grabbed me by the proverbial lapels and piqued my interest was the original set of circumstances that led to the lawyer coming up with the lie that he had cancer. You see cancer was the story offered to explain to The University of Chicago Law School why this future lawyer only scored a 158 on the LSAT.

Wait for it.

I only scored 160 on the LSAT. It never dawned on me that I was even supposed to be disappointed in that result, much less that I should have tried to lie about having cancer to explain the poor performance.

But, 160 is two points higher than 158; also, I wasn’t applying to the University of Chicago Law School. So, apples and oranges I guess.

If you want to read the entirety of the latest amended disciplinary complaint against Vincenzo Field, you can get it here.

Crowdfunding for attorney fees? Yes, but no.

So, since about early December of last year I’ve been trying to find a way to write about a really good, quite practical (albeit practical about a very niche situation) D.C. ethics from November 2018. The D.C. Opinion, Ethics Opinion 375, addresses the idea of using crowdfunding platforms as an ethical way for a client to afford otherwise unaffordable attorney fees.

It is easy to get in the right mindset to elaborate on why an ethics opinion is bad. I have had a hard time getting into writing about Opinion 375 because, truth be told, it is hard to write something that feels useful and interesting about a well-done ethics opinion.

But I’m writing about it today because, thankfully, along came a West Virginia disciplinary case with a development that makes this so much easier to discuss.

First, let’s get you up to speed on the D.C. opinion — “Ethical Considerations of Crowdfunding.” Now, of the various mechanisms that exist online for crowdfunding, the D.C. opinion focuses only on donation-based crowdfunding platforms — things like Go Fund Me rather than other kinds of platforms that bring large groups together to fund things in exchange for an equity stake or something similar.

The summary that starts out the opinion is largely all you really need to know about it:

Lawyers are generally free to represent clients who pay for legal services through crowdfunding. The ethical implications of crowdfunding a legal representation vary depending on the lawyer’s level of involvement in the crowdfunding. When the client directs the crowdfunding and the lawyer is merely aware of it, the lawyer incurs no specific ethical obligations although the lawyer should consider the potential risks associated with receipt of such funds and may counsel the client on the wisdom of publicly sharing confidential information. When the lawyer directs the crowdfunding, the lawyer must comply with the Rules governing a lawyer’s receipt of money from third parties. Further, a lawyer who directs the crowdfunding should be cognizant of ethical obligations regarding fee agreements, communications with donors, and the management of the funds raised.

Now, if you want to troll the depths (the D.C. Bar managed to list off 11 different ethical rules that were applicable to the situation), there is more than five pages of analysis to be had in the full opinion.

All in all, it’s well done and practical advice to address what is a particularly modern variation on the question of third parties paying a client’s fees.

So, crowdfunding is a viable option for clients to pay a lawyer … but … there are certain ways it can’t. be. used. For one thing, it can’t be used by a lawyer to get clients in the first place.

And that point brings us to West Virginia. Were I more of a delusional sort, I’d think this story was fabricated into existence Truman Show style just for my benefit. In terms of trying to appeal to me, this story has everything … (and you have to say this next part in the voice of Bill Hader’s “Stefon” character from SNL): it has a lawyer with the same name as a lawyer at a prominent firm in Memphis; the West Virginia lawyer started practicing law essentially exactly when I did [1999]; the West Virginia lawyer was serving as a treasurer [I’m the treasurer for two organizations at the moment] for a local soccer organization [ask me about soccer, I dare you, I won’t stop talking], and West Virginia’s Chief Disciplinary Counsel actually recused from the case because they are a soccer official.

Now, this West Virginia lawyer’s story isn’t really a story about Go Fund Me. Where the lawyer really went afoul of his ethical obligations was something he did long before he tried to use Go Fund Me in exactly the wrong sort of way, but that piece was the headline grabber for at least one West Virginia media outlet that wrote: “Charleston attorney suspended for 3.5 years after offering legal advice for Go Fund Me money.”

This lawyer’s original – and much more significant — transgression was that the lawyer embezzled about $12,000 from the soccer organization’s account by transferring those funds to his personal checking account. After he was confronted about his theft, he resigned from the treasurer position and repaid the money in three installment payments.

He self-reported his violation [which would have been, at minimum, a violation of West Virginia’s RPC 8.4(c) and probably (b)) and then was fired from his employment when his employer learned about the theft from the soccer organization.

After that, he tried setting up a Go Fund Me page to raise money to help him transition from being a lawyer employed at a firm to being a sole practitioner. What he offered, however, was that those who donated to the Go Fund Me would receive free legal services in exchange.

The West Virginia bar cited that conduct as being a violation of the rules against soliciting clients. The lawyer denied ever receiving any funds as a result of the Go Fund Me account in question and contended that he did not realize he had actually made it publicly-viewable.

An article in The ABA Journal online also emphasizes some of the aspects in which the Go Fund Me appeal itself was supported with false and misleading statements:

The fundraising appeal said the move was based on a decision to help children.
“After nearly 20 years of practicing law, I have finally found what I was meant to be doing,” the appeal said. “I have transitioned from an insurance defense practice to becoming a sole practitioner representing individuals and families. My primary focus is helping children who have been abused and/or neglected.”
Glover went on to say that his employer asked him to leave immediately after learning of his plans to go solo. “Given the short notice, I was not able to build up my savings, and I am now struggling to meet my personal expenses,” he wrote.
“It is my intention to return any gifts once my income become steady, and I will be happy to offer free legal advice (if I can) to my benefactors as well.”

That piece of this story is a very good reminder that, no matter the platform, rules patterned after ABA Model Rule 7.1 make it a disciplinary infraction for a lawyer to make statements about themselves or their services that are false or misleading.

New Lunar Year, New Lunar Rule?

Okay, the title is something of a stretch to acknowledge that today marks the beginning of a new lunar year, the Year of the Pig. Nothing about what I have to say relates to the moon or anything Lunar.

But I did want to continue one part of the discussion begun in Las Vegas last month, and truly follow through on my insistence about how what happens in Vegas shouldn’t just stay in Vegas this time, by sharing the text of a proposed new Model Rule that I drafted and that we kicked around during a panel discussion at the APRL Mid-Year Meeting.

The general topic is what to do with the rules, if anything, to address the reality of online lawyer matching services and other similar platforms that are benefiting consumers by helping connect consumers who are willing to pay a certain price point for legal services and lawyers who are willing and able to deliver those services at that price point but that are always in tension with the current ethics rules because of restrictions on lawyers providing compensation for referrals or recommendations and related restrictions on fee sharing.

We have a rule here in Tennessee which I believe to be substantively bad, but the architecture of the rule is pretty good if you change its goals. Sort of like an old house with really good bones but simply god-awful interior decorations. That rule is RPC 7.6 and imposes certain registration requirements and limitations on things denominated as “intermediary organizations.” Long time readers of this blog, might remember this post about how I believed RPC 7.6 applied to Avvo Legal Services back when that was still in operation.

The rule I have drafted as a conversation starter uses the architecture of the Tennessee rule but is designed to provide a more permissive and more flexible approach to the topic.

Implementation of such a rule would likely also require changes to Model Rules 5.4 and 7.2 to make clear that payments to intermediary organizations are not prohibited as fee sharing or prohibited by the restrictions on payment for referrals, and the accompanying Comment would likely need a paragraph to make clear certain things that are not intended to be swept up as an intermediary organization, but carts and horses and all of that.

The draft is posted below, all feedback is most welcome.


Proposed Model Rule 7.7:  Intermediary Organizations
(a)  An intermediary organization is a lawyer referral service, lawyer matching service, or other similar organization which engages in referring consumers of legal services to lawyers or facilitating the creation of attorney-client relationships between consumers of legal services and lawyers willing to provide assistance.


(b)  A lawyer may make a payment to an intermediary organization, including a payment that would be considered sharing of an attorney fee with an intermediary organization, in connection with any referral or facilitation of a relationship with a client as long as:


                (1)  The relationship between the lawyer and intermediary organization is fully disclosed to the client including, if requested by the client, the amount of any payment made by lawyer to the intermediary organization;
                (2)  The cost to the lawyer of any payment to the intermediary organization is not passed on to the client; and
                (3)  The lawyer does not permit the intermediary organization to direct or regulate the lawyer’s professional judgment in rendering legal services to the client.

Inflation is likely more widespread than you’d like to believe.

Time inflation that is. I’m certainly not an economist.

In the past, I have written about issues associated with overbilling by lawyers in a number of different respects.

Today’s post involves a rare public situation involving the admission of overbilling by a lawyer – one that comes out of Illinois and involves a lawyer who worked his way up the ladder in not just one but two prominent firms in Chicago.  The attorney, Christopher Anderson, has now been made the subject of formal disciplinary proceedings based on his own admission of inflating his time entries and billings first while at Kirkland & Ellis as an associate and later at Neal Gerber Eisenberg, ultimately achieving the status of a non-equity partner.

Anderson came clean to the powers-that-be at the Neal Gerber firm after he had been practicing there for three years in 2018.  That firm did its own investigation and decided it needed to offer refunds or credits to some 100 clients who had been made to overpay as a result of Anderson’s conduct.  The refunds, as reported in the disciplinary complaint, amounted to roughly $150,000 and stemmed from the conclusion that only 4/5 of the time Anderson had billed to clients was legitimate.  The complaint indicates that once Kirkland & Ellis learned of Anderson’s conduct and that he had been engaged in the behavior there as well worked through its own process to offer refunds to clients.

The complaint describes the nature of the scheme on Anderson’s part to inflate his billings and is what I have always believed is what happens to be the most widespread way of abusing billable hours in our profession because it is the most tempting route to travel and the one that lawyers believe is the hardest to prove is happening:

During his time at both firms, in an attempt to meet what he perceived to be the firms’ billing expectations, Respondent recorded time beyond what he had actually spent in handling client matters, knowing that the time he recorded would be billed to his client and that they would be asked to pay fees based on the records he created.  For the days that Respondent felt he had not recorded sufficient time on client matter, he increased the time he claimed to have been spent on those matter based on a number of factors, including his assessment of the likelihood that the client would object to the time he recorded.  As an example, if Respondent spent 0.3 hours on a client matter, he would record that he had actually spent 0.5 hours, or he would bill 2.1 hours for work that actually took him 1.7 hours to complete.

Not surprisingly, some immediate reporting about the situation from The American Lawyer stressed the rareness of intentional overbilling. I beg to differ on that.   Unfortunately, I think this kind of practice goes on much more often than our profession would ever care to admit.  People who act out of a feeling of pressure that their “numbers” are not strong enough or who feel like they’re being forced to accept a cut-rate hourly fee for their time can find themselves heading down this path because, unlike inventing tasks that could be proven not to have been performed, there truly is very little ability for an outsider to prove that a lawyer who says they spent 2.1 hours doing something that really only took them 1.7 hours to complete is lying to you.

Or, as more succinctly put by my friend Trisha Rich who was quoted in the Chicago media about this:


“It would be hard for somebody to catch on to (overbilling in small increments) if somebody was doing that over time, because basically our billing records are on your honor,”

Other than this particular situation in which the conduct came to light because of the lawyer’s own guilty conscience, instances usually will not be ferreted out unless the lawyer also forgets that “pigs get fat and hogs get slaughtered.”

The other interesting piece of this story is that Illinois is only charging Anderson with violations of RPC 1.5 and RPC 8.4(c), but not also charging for violating RPC 7.1.  Illinois’s Rule 7.1 certainly could have also been included in the complaint because Illinois’s version of the rule has the same language as the ABA Model Rules:  “A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services.”

Given that Anderson essentially has admitted the misconduct, throwing an additional charge at him likely would just have been piling on, but trying to remind lawyers that RPC 7.1 doesn’t just apply to advertising but applies to a wide variety of false statements about a lawyer or their services (here, falsely stating how much time you actually worked) is something of pet peeve of mind mine. [edited to be less stupid on 1/31/19]

More UPL Madness From Ohio

You may recall some past discussion here of the prolonged saga of the Dinsmore lawyer who moved from one of its offices in Kentucky to its Cincinnati, Ohio office and nearly was denied comity admission in Ohio over accusations of the unauthorized practice of law.

While that story ended happily — she was ultimately determined not to have character and fitness problems after the Ohio Supreme Court decided that it was not the unauthorized practice of law for her to sit in a chair in Ohio and continue to work on Kentucky cases using her Kentucky license while awaiting bar admission in Ohio — it was unnecessarily messy for all concerned.

In the past, one of the points I have raised about bar regulators using UPL accusations as a cudgel is that it seems that many jurisdictions seek to have it both ways – arguing that you are always practicing law “in” their jurisdiction whether they have to put you there through being in a seat in the state or if they have to put you there despite the fact that your seat is in a different state.

The most recent UPL ruling out of Ohio demonstrates that Ohio apparently has this proclivity as well.

Right at the end of 2018, the Ohio Supreme Court issued an order concluding that a lawyer, who was licensed in New York, New Jersey, and California, and his law firm, had engaged in UPL by representing debtors who lived in Ohio. The order wasn’t actually a disciplinary penalty but it essentially enjoined them from further practice in Ohio, and imposed a $2,000 civil fine.

The Panel Report which the Court adopted through its order provided detail regarding the representation:

This matter involves Respondents’ representation of an Ohio resident, Timothy Hoover . . . .  Respondents executed a Power of Attorney document on January 6, 2010, through which Mr. Hoover appointed Respondents as “his true and lawful attorney.”  On May 14, 2010, Respondents on behalf of Mr. Hoover, issued a letter to Ohio attorney Lee Peterson, who represented CitiFinancial, Inc. (“CitiFinancial”), a creditor of Mr. Hoover’s.  Respondents held themselves out in the May 14, 2010 letter as Mr. Hoover’s counsel, identifying themselves as a law firm and referring to Mr. Hoover as their “client.”  A similar letter followed on May 27, 2010.  It appears that Respondents’ outreach coincided with a suit filed by CitiFinancial against Mr. Hoover in the Licking County Municipal Court for money owed on a note, though Respondents did not make, or attempt to make, an appearance in that matter.  Regardless, the facts are undisputed (1) that CitiFinancial sued Mr. Hoover, an Ohio resident, in an Ohio court based on transaction and default that occurred in Ohio, and (2) that Respondents, without any legal counsel licensed to practice law in Ohio, contacted counsel for CitiFinancial and purported to represent Mr. Hoover in debt negotiations on that Ohio matter.

Of course, the correct response to someone laying out those “undisputed” facts in a just world would be: so what?

Neither the order nor the Panel report it adopted provide all that much in the way of detail about any of the arguments made by the lawyer to defend himself against the charges (and, in fact, it mostly reads like he didn’t.)

A review of Ohio RPC 5.5 demonstrates though that there were at least two strong arguments that should have been pursued because Ohio’s version of that rule largely tracks the ABA Model Rules.

First, assuming that the lawyer truly was not only ever going to attempt to negotiate the debt reduction without ever being willing to appear in the lawsuit, the lawyer should have been able to argue that, as long as he had no reason to think he could not ultimately be admitted pro hac in the lawsuit if negotiation was unsuccessful, (c)(2) should provide sufficient cover. That rule provides the ability on a temporary basis to provide services:

reasonably related to a pending or potential proceeding before a tribunal in this or another jurisdiction, if the lawyer, or a person the lawyer is assisting, is authorized by law or order to appear in such proceeding or reasonably expects to be so authorized;

Second, assuming that the lawyer couldn’t look to (c)(1) because they were never going to do anything beyond negotiating, the lawyer could have looked to Ohio RPC 5.5(c)(4) for approval to contend that these negotiations for the client were ones that “arise out of or are reasonably related to the lawyer’s practice in a jurisdiction in which the lawyer is admitted to practice.” This would be because, as the Panel report and Order also explained, the lawyer and his firm’s “practice includes counseling and assistance to individuals regarding the reduction of consumer debt. Once retained, Respondents contact their client’s creditors and attempt to negotiate a reduction of outstanding debts.”

What’s happening in Vegas this week?

So glad you asked. Let me tell you, and tell you why, despite the tried and true adage, it needs to not stay in Vegas.

Later this week the Association of Professional Responsibility Lawyers is having its mid-year meeting in Las Vegas, and we are dedicating our entire programming to a theme: The Future of Lawyering. Under the leadership of former APRL President, Art Lachman, and as I have mentioned in the past, we have launched a Future of Lawyering Committee that is taking a look at potential ways to overhaul certain aspects of the ethics rules.

We will have a day and a half of programming dedicated to that topic. There will be panels discussing each of the following topics:

  • The potential for reform in the 21st Century on issues of cross-border practice
  • How to address “nonlawyer” practice in this modern era.
  • What the practice of law might be like if there was no Model Rule 5.4.
  • The pros and cons of the notion of making having professional liability insurance mandatory for lawyers.
  • What ought to be done, if anything, about changing how law firms are regulated (or not) under the ethics rules
  • Exploring the impact of A.I. on ethical law practice

Oh, and there’s one I left out of that list.

I’m fortunate enough to be involved in one of the panel discussions: “Ethical ‘Evils’ of Referral Fees and For-Profit Referral Services: Time for a Change?” Our panel will be teeing up two possible ideas for things to consider in terms of the restrictions that exist on the ability of lawyers to compensate people and entities who, in one form or fashion or another, refer business to them.

One possibility will be the “radical” notion of what would the rules simply look like if there was no restriction at all in Model Rule 7.2 on providing such compensation? The other possibility will be to look at a proposed new Model Rule 7.7 that yours truly has drafted in the first instance that would seek to permit the wide variety of currently-existing (and recently shut down) on-line matching platforms, and dropping away any concerns about whether such arrangements involve unlawful payments for referrals, as long as the lawyers involved maintain their independent professional judgment, costs of the arrangement aren’t passed on to clients by the lawyer, and the arrangement is transparent to the client.

This combination of programs should make for a very invigorating and enlightening debate on a wide variety of important issues. And, for once, hopefully we will all manage to agree that what happens in Vegas does not just stay in Vegas this time.

Texas Two Steps Forward…One BIG Step Back

I have written in the past about the fact that I am fortunate to be the Chair of the Tennessee Bar Association’s Standing Committee on Ethics and Professional Responsibility. Because our committee is currently beginning a process of chewing over whether to try to recommend changes to the advertising rules in Tennessee, I’ve been trying to pay closer attention to developments in other states. Specifically, trying to pay closer attention to whether the revisions to the ABA Model Rules inspired by the work of APRL are moving the needle in the correct direction.

Long time readers of this space will know that my long-espoused view is that the only real rule needed in terms of lawyer advertising is a prohibition on false or misleading communication. The ABA Model Rules have moved closer – but not all the way of course — to that kind of approach.

Today’s post is about the fact that the Texas Committee on Disciplinary Rules and Referenda has proposed revisions to Texas’s ethics rules on advertising that are open for public comment until March 1, 2019.

You can read the proposed revisions here.

The short version is that these proposed revisions seem like a very positive development in a few respects as to regulation on lawyer advertising. The biggest positive is that these changes would replace wholesale the kind of improper categorization of certain statements that can be made truthfully (like comparison of one lawyer’s services to another or discusses past results obtained for clients) currently housed in Texas’s Rule 7.02(a) with a revised Rule 7.01 that isn’t perfect in terms of just prohibiting actually false or misleading communications but is better.

Unfortunately, the other piece of the short version is that the Texas revisions would still perpetuate a very pernicious and unnecessary barrier to speech in the form of filing requirements and payments in the form of filing fees for any advertisements that are not limited to certain types of “pre-approved” information.

The Texas proposed revisions would do this by continuing to carry forward in a revised Rule 7.04 the following requirement:

A lawyer shall file with the staff of the Advertising Review Committee of the State Bar of Texas, no later than the date of dissemination of an advertisement of legal services via public media, or the date of a solicitation communication sent by any means, including social media, for the purpose of obtaining professional employment:

(1) a copy of the advertisement or solicitation (including packaging if applicable) in the form in which it appeared or will appear upon dissemination;

(2) a completed lawyer application advertising and solicitation communication application; and

(3) payment to the State Bar of Texas of a fee set by the Board of Directors.

For context, currently the fee is set at $100. You can review the relatively invasive application form that is required and all of its bells and whistles here. In reading it you will also learn the cute part where if more than one lawyer in separate firms is involved in the same advertisement they are still each required to separately submit applications and pay multiple $100 fees.

The proposed revision would also exempt certain limited types of communications from these requirements as long as they only contain the “vanilla” categories of information pre-approved by the regulators.

Such a regulatory regime does not exist for any reason other than to fundamentally discourage advertising., should not be tolerated, and pointlessly mars any progress the Texas proposal otherwise offers.

Friday follow up: Yesterday’s post

Well, this may be the most rapid Friday follow up in this blog’s history.

A wise and well-connected reader has been in touch to let me know why my analysis yesterday of NYSBA Op. 1160 was all wet. He was, of course, right as I somehow managed to blow past a very important piece of the puzzle regarding the situation NYSBA Op. 1160 was addressing. The inquiring lawyer was actually willing to put together an arrangement that would have made the out-of-state lawyer a part of his “firm.”

I wrote that was not the case prior to discussing the part of the opinion that sought to distinguish prior guidance from about 8 years earlier. Specifically, where I went awry was here:


New York’s 1.5(g) only lets lawyers not in the same law firm (and to be clear the inquirer’s desire to affiliate did not apparently involve actually forming a law firm together) share legal fees if, among other bells and whistles regarding consent and the existence of a writing, the amount of the division of the fee is either proportional to the service performed or (if it is going to be disproportionate in that respect) if both lawyers assume joint responsibility for the work.

The “facts” section of the opinion, however, makes clear that I got that wrong.

The inquirer, an attorney recently admitted to practice in New York, is acquainted with another lawyer. The other lawyer, like the inquirer, resides in New York, but the other attorney is admitted only in another state, not New York, though the latter is admitted to practice in federal courts located in New York. According to the inquirer, the other lawyer is capable of generating business, and the inquirer would like to affiliate with this other lawyer, listing the other lawyer as a partner, associate, counsel, or otherwise, on letterhead showing that the other lawyer is admitted solely in the other state and not New York. The inquirer anticipates that the other lawyer would attend initial meetings with the clients being produced by the other lawyer, but then would not deal with any of the legal work being performed.

I certainly regret my error.

I particularly regret my error because it was part of my thinking when I said at the outset of yesterday’s post that NYSBA Op. 1160 still got the answer right. Now that I actually am paying better attention to the facts, I realize that the opinion absolutely did not get to the correct answer. Instead it was flat wrong.

Rule 1.5(g) wouldn’t be in the mix since that is sharing of fees among lawyers not in the same firm. Likewise, the stated concerns in the opinion about Rule 7.2(a) are irrelevant because that rule surely is not intended to apply to arrangements among lawyers within the same law firm.

There are multi-state law firms all over this nation that have partners who do absolutely nothing on a particular client matter beyond what is described as the role the out-of-state lawyer would have had under the inquiry. Those lawyers most definitely share in the fees of the client when they make rain through something often called “origination credit” by law firms.

Some of those firms most certainly have offices in New York and I just about guarantee that no one would think twice about such internal compensation arrangements in terms of questioning whether they are ethical because all of those lawyers are in the same firm and the decisions they make about how to divide fees are treated as pure business questions of compensation.

The rules in that regard shouldn’t be any different for a firm of two lawyers than for a firm of 2,000.

In a New York (out-of) state of mind…

It has been a minute or two since I’ve stumbled upon an ethics opinion that provides a quick and easy example of how to take an issue, makes it overly complex and in so doing highlight several ongoing problem areas in the regulation of the profession, but ultimately still get to the correct result as to the “yes” or “no” answer to the question addressed.

But along comes New York State Bar Association Committee on Professional Ethics Opinion No. 1160. This one seems to me to be just such an opinion so let’s chat about it briefly.

Op. 1160 exists to answer the following question:

May a lawyer admitted in New York affiliate and share legal fees with another lawyer, who, while a resident of this State, is not admitted here, with the affiliation intended solely for the purpose of obtaining clients referred by the non-admitted lawyer?

Now, because the question included the desire to share legal fees with the rainmaking lawyer who was living in but not licensed in New York, the opinion could have chosen to cut to the chase based on a relatively straightforward application of New York’s Rule 1.5(g) which largely tracks ABA Model Rule 1.5(e).

New York’s 1.5(g) only lets lawyers not in the same law firm (and to be clear the inquirer’s desire to affiliate did not apparently involve actually forming a law firm together) share legal fees if, among other bells and whistles regarding consent and the existence of a writing, the amount of the division of the fee is either proportional to the service performed or (if it is going to be disproportionate in that respect) if both lawyers assume joint responsibility for the work.

Given that the inquiry transparently admitted that the rainmaker would not be doing anything beyond landing the client and passing the client on to the New York lawyer for handling, it seems pretty clear that Rule 1.5(g) could only be satisfied if the lawyers would be assuming joint responsibility. Given the lack of a New York license for the rainmaker, that would seem an impossible state of affairs because while landing a client might not cross the line into the unauthorized practice of law in New York, agreeing to have joint responsibility for legal work performed in New York for a New York client would be harder to argue involves staying on the right side of the line. Thus, it feels like the NYSBA committee could have wrapped this one up with a bow in a 1 or 2 pages tops.

In fairness, they almost managed to do something like that when they attempted to explain the difference between this situation and an earlier opinion they issued in 2011:

We examined Rule 1.5(g) in N.Y. State 864 (2011), in which the inquirer wished to accept a referral from an out-of-state lawyer in a personal injury matter. The injury occurred in New York and the referring lawyer proposed that, in the particular matter at issue, the in-state lawyer would “handle” the matter and pay the referring lawyer a portion of any recovery. We endorsed the proposal subject to compliance with Rule 1.5(g)…. Although we have declined to delineate the precise contours of “joint responsibility” under this Rule …, we have made clear that the mere cultivation of client relationships does not qualify as “services performed” by the referring lawyer… Thus, the inquirer’s contemplated action would violate Rule 7.2(a) unless it could be said that the inquirer is ethically permitted to be affiliated with the out-of-state lawyer in the circumstances presented.

Where the committee goes awry is that last sentence which is pretty viciously circular.

It seems like it should have said: Thus, the inquirer’s contemplated action would violate Rule 7.2(a) unless it could be said that the out-of-state lawyer was willing to undertake “joint responsibility” for the matter and if doing so would not constitute the unauthorized practice of law.

They did not write it that way, however. And, as a result, the rest of the pieces of the opinion exist all of which for rhetorical purposes treat the rainmaker, despite being a lawyer licensed in at least one jurisdiction, as a “non lawyer.” And much of which bears the hallmarks of heavy-handedness that often arise in ethics opinions construing restrictions on (1) the ability of lawyers to offer compensation to those who refer them work, (2) the ability of lawyers to ask for work from clients; and (3) the ability of lawyers to practice law remotely.

You can read the full opinion here.