The Committee Explains the Proposed Rules
Members of the Committee on Disciplinary Rules and Referenda weigh
in on the history,
process, and substance of the disciplinary rule changes under
consideration.
The Committee on Disciplinary Rules and Referenda consists of M. Lewis
Kinard (Chair), Timothy D. Belton, Amy Bresnen, Claude Ducloux, Justice
Dennise Garcia, Rick Hagen, Vincent R. Johnson, W. Carl Jordan, and
Karen J. Nicholson. Jane King previously served on the committee. To
learn more about the Committee on Disciplinary Rules and Referenda, go
to texasbar.com/cdrr.
The Rulemaking Process Has Changed. And for Good Reason.
Written by Amy Bresnen
The Committee on Disciplinary Rules and Referenda, or CDRR, was
created by the 85th Legislature as a centerpiece of the State Bar Sunset
bill. The CDRR was intended to address inefficiencies and lack of
timeliness and public input that plagued previous rulemakings. The CDRR
is tasked with regularly reviewing the Disciplinary Rules of
Professional Conduct and the Rules of Disciplinary Procedure, providing
annual reports to the Texas Supreme Court and State Bar of Texas Board
of Directors on the adequacy of the rules, and being the gatekeeper over
the process of proposing and vetting disciplinary rules.1
In 2016, the Sunset Advisory Commission, evaluating the bar during its
Sunset review process, made a startling recommendation: Scrap the
referendum and leave rulemaking entirely to the Supreme
Court.2
The recommendation cited past failures of the old process, notably the
2011 referendum where all proposed rules failed and the chaotic
eight-year process preceding it. Under then-state Sen. Kirk Watson’s
leadership, the Legislature took its task seriously, crafting a solution
that allows bar members to continue governing themselves by referendum.
After considering input from stakeholders, the Legislature established a
process that emphasizes transparency and efficiency and that promotes
participation by the general public and bar membership.
Transparency
The Legislature intended the CDRR’s operations to be fully transparent.
This is why every CDRR monthly meeting is open to the public regardless
of whether the committee is actually deliberating a rule. This was not
only to enact good governance; it was a direct response to the previous
rulemaking attempts that alienated many attorneys and the public at
large. It’s also why there is a statutorily mandated minimum 30-day
public comment period while a proposed rule is being
considered. For the advertising rules, the CDRR extended the initial
comment period to three months. And, it’s why the committee holds a
public hearing on each proposed rule, and if the proposed rule is
substantially changed during its deliberation, the committee will hold
another public hearing on it. For example, given the substantial
interest among the public and bar, and the extensive public comment, the
CDRR held four public hearings on the advertising rules.
Efficiency
To facilitate efficiency in the rulemaking process, the Legislature made
the CDRR a gatekeeper and coordinator for overseeing the process for
proposing and vetting a disciplinary rule. The Legislature also ensured
that public and bar input would be considered early in the process. For
a proposed rule to advance, it must be published for public comment in
the Texas Register and Texas Bar Journal within six
months of initiation of the rule proposal process. Additionally, the
committee is statutorily required to submit an annual review of the
disciplinary rules to ensure the committee’s work will be regular and
ongoing, instead of having long periods of review and inactivity, while
recognizing that there may be years when the committee determines the
rules are adequate and doesn’t propose any changes.
AMY BRESNEN
is an attorney and lobbyist at BresnenAssociates. She previously
worked in both the Texas House and Senate and now represents businesses
and associations at the Texas Capitol. Bresnen has served on the CDRR
since 2018.
The Proposed Rules on Advertising and Solicitation
State Bar of Texas Rules Vote, February 2 to March 4, 2021
Written by Vincent R. Johnson
Note: This article addresses the rule proposal appearing as ballot
item E.
The proposed rules dealing with lawyer advertising and solicitation seek to clarify, simplify, and modernize this area of the law, while nevertheless continuing to endorse principles and practices that have proved to be sound. Here are some of the high points.
Proposed Rule 7.01: Communications Concerning a Lawyer’s
Services
Front and center, this provision states the basic rule that is the
cornerstone in this area of the law: namely, a lawyer shall not make a
false or misleading statement about legal services. This rule, which is
rooted in constitutional jurisprudence, applies to all communications
offering legal representation.
The proposed provision then defines what constitutes an
“advertisement” or a “solicitation communication.” These definitions are
structurally important because certain rules laid down in subsequent
sections apply only to advertisements or solicitation communications.
In general, an advertisement is a communication directed to the public
at large, whereas a solicitation communication is directed to a specific
person. However, as defined by this rule, a communication falls into
neither category unless it is “substantially motivated by pecuniary
gain.” This means that lawyers promoting various forms of nonprofit
legal services, such as legal aid for the poor, do not need to worry
about complying with the disclosure and filing requirements that are
applicable to advertisements and solicitation communications. (Of
course, they must still comply with the ban on false or misleading
statements.)
Because statements that are truthful and not misleading are
constitutionally protected, this rule abandons the traditional
prohibition against the use of trade names. Unless it is false or
misleading, use of a trade name is permitted. A large majority of
jurisdictions now permit the use of trade names.
Proposed Rule 7.02: Advertisements
The requirements of this rule dealing with advertisements will feel
familiar because they are rooted in earlier law. An advertisement:
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must identify a lawyer responsible for its content (and the lawyer’s primary practice location);
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may disclose that the lawyer has been certified or designated as possessing special competence, including by the Texas Board of Legal Specialization, if certain requirements are met; and
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must disclose whether a client who is represented on a contingent fee basis will be obligated to pay for other expenses, such as costs of litigation.
The rule also addresses how long a lawyer must conform to a specific fee or range of fees promoted in an advertisement.
Proposed Rule 7.03: Solicitation and Other Prohibited
Communications
This rule carries forward traditional prohibitions against in-person
solicitation. However, the rule now makes clear that the
anti-solicitation ban applies not only to in-person contact, but also to
“telephone, social media, or electronic communication initiated by a
lawyer, or by a person acting on behalf of a lawyer, that involves
communication in a live or electronically interactive manner.”
For the first time in Texas, this rule expressly indicates that it
does not prophylactically ban all solicitation communications
with “a person who is known by the lawyer to be an experienced user of
the type of legal services involved for business matters.” In such
situations there is little risk of abuse. However, the rule continues to
prohibit any communication that involves “coercion, duress,
overreaching, intimidation, or undue influence.”
A solicitation communication must not be “misleadingly designed to
resemble a legal pleading or other legal document” and, with limited
exceptions, must be “plainly marked” ADVERTISEMENT.
This provision continues the traditional rule that a lawyer may not
pay or give anything of value to a person not licensed to practice law
for soliciting or referring prospective clients, except that now
“nominal gifts given as an expression of appreciation that are neither
intended nor reasonably expected to be a form of compensation for
recommending a lawyer’s services” are permitted.
In addition, reciprocal referral agreements with another lawyer or
nonlawyer professional are now allowed provided “(i) the … agreement is
not exclusive; (ii) clients are informed of the existence and nature of
the agreement; and (iii) the lawyer exercises independent professional
judgment in making referrals.”
The rule continues the prohibition against paying or giving anything of
value to a prospective client (other than certain litigation expenses
and other financial assistance permitted by the rules), except that now
“ordinary social hospitality of nominal value” will be permitted.
Proposed Rule 7.04: Filing Requirements for Advertisements and
Solicitation Communications
This rule continues the filing requirements for certain advertisements
and solicitation communications. It also continues to allow lawyers to
seek preapproval of advertisements and solicitation communications.
Proposed Rule 7.05: Communications Exempt from Filing
Requirements
This rule greatly expands the number of situations in which
advertisements or solicitation communications are exempt from the filing
requirements of Rule 7.04. In particular, “(a) any communication of a
bona fide nonprofit legal aid organization that is used to educate
members of the public about the law or to promote the availability of
free or reduced-fee legal services” is exempt.
In addition, “information and links posted on a law firm website,
except the contents of the website homepage” are exempt.
Professional newsletters are exempt if they are sent to “(1) existing
or former clients; (2) other lawyers or professionals; (3) persons known
by the lawyer to be experienced users of the type of legal services
involved for business matters; (4) members of a nonprofit organization
which has requested that members receive the newsletter; or (5) persons
who have asked to receive the newsletter.”
There is also an exemption from filing for “a communication in social
media or other media, which does not expressly offer legal services, and
that: (1) is primarily informational, educational, political, or
artistic in nature, or made for entertainment purposes; or (2) consists
primarily of the type of information commonly found on the professional
resumes of lawyers.”
There are other exemptions that reduce the burdens of filing.
Proposed Rule 7.06: Prohibited Employment
This rule states when violation of various rules dealing with
communications about legal services, or general principles of
misconduct, result in personal disqualification, imputed
disqualification of other lawyers in a firm, or restrictions on
referral-related payments.
Voting in favor of this part of the referendum will reduce the
uncertainties that too often surround speech about legal services in the
digital age, while at the same time continuing to protect potential
clients from the harm that may be caused by false and misleading
statements or overreaching practices.
VINCENT R. JOHNSON
is the South Texas Distinguished Professor of Law at St. Mary’s
University.
Limited Pro Bono Legal Services: the Case for Proposed Rule 6.05
Written by M. Lewis Kinard
Note: This article addresses the rule proposal appearing as ballot
item D.
The need for Proposed Rule 6.05 in Texas became clear after Hurricane
Ike in 2008. In the weeks after the rains stopped, I helped orient and
encourage dozens of lawyers who wanted to help people handle the
critical, unexpected legal complications of surviving a huge natural
disaster. Working with the Houston Bar Association, lawyers from Lone
Star Legal Aid went over topics such as completing Federal Emergency
Management Agency forms, alternative ways to prove ownership and
identification, emergency food stamp and Medicare options, and who is
responsible for removing a neighbor’s fence or house from one’s own
yard.
It was great to see so many lawyers eager to go to the disaster relief
centers where families poured in seeking help putting their lives back
together. But when the disaster legal aid desks were set up, very few of
those trainees appeared.
The same thing happened after Hurricane Harvey in 2017 and even the
wildfire season of 2011. Most of the disaster legal aid work was handled
by professional legal aid attorneys, a few volunteers provided through
the American Bar Association, and standing pro bono programs in large
counties.
What happened? When asked, those who gave an answer generally pointed
to one thing: the fear of imputed conflicts of interest under
Disciplinary Rules 1.06, 1.07, and 1.09. Many firms discouraged or
restricted their associates from going out to remote help centers
because there were few options and no time to complete conflicts checks
before assisting each disaster victim. A well-meaning attorney might
provide advice adverse to a lucrative present or future client of the
firm, even if only represented by a distant office.
In response to stories like this around the country, the American Bar
Association’s Ethics 2000 Commission added Model Rule 6.5 in 2002. Every
state except Texas and one other has adopted the rule or a version of
it. We need this rule. More accurately, Texans need the bar to
approve this rule.
Conflict of interest rules are important protections for
clients—present, former, and future. But the drafters didn’t contemplate
situations where lawyers do not know all their firm’s clients or, in an
effort to address urgent, simple legal questions, might unknowingly
cause significant economic consequences to the other lawyers in their
firms as well as their other clients.
Rather than modify all rules with imputed conflict provisions, this
new rule carves a very narrow exception in a way that strikes a balance
between protecting the client’s interests and keeping prohibitions
against a firm representing a party adverse to another client.
The proposed rule describes when it applies (very limited help in a
short period of time, such as a help desk), what a lawyer must do to
earn and keep the exemption (avoid known conflicts and not share
confidential client information with other firm lawyers, e.g.) and
requires the services to be run by a court, bar association, law school,
or nonprofit legal services program (for accountability).
The exception is narrow. The benefit to the public will be broad.
M. LEWIS KINARD
is executive vice president, general counsel, and assistant corporate
secretary at the American Heart Association. He spent six years on the
State Bar of Texas Committee on Texas Disciplinary Rules of Professional
Conduct until it was disbanded in 2018. With over 30 years of legal and
business experience, Kinard is serving as the first chairperson of the
Committee on Disciplinary Rules and Referenda.
A Practicing Lawyer’s Guide to the Proposals
Written by Claude Ducloux
Note: This article addresses the rule proposals appearing as ballot
items A, B, C, F, G, and H.
Ballot Item A: Scope and Objectives of Representation;
Clients with Diminished Capacity
As our population ages, and many people work longer than they
anticipated, the danger of encountering clients with decreased mental
facility is increasing. Lawyers need a rule like this, equipping and
guiding us with additional tools for handling situations that put the
client or the client’s estate at risk. The proposal deletes Rule 1.02(g)
of the Texas Disciplinary Rules of Professional Conduct and adds
Proposed Rule 1.16. Among its provisions, Proposed Rule 1.16 permits a
lawyer to take appropriate protective action when the lawyer reasonably
believes that a client has diminished capacity; is at risk of
substantial physical, financial, or other harm unless action is taken;
and cannot adequately act in the client’s own interest. Proposed Rule
1.16 provides a non-exhaustive list of actions a lawyer may be
authorized to take, including informal consultations that may be
prohibited under the current rules.
Ballot Item B: Confidentiality of Information – Exception to
Permit Disclosure to Secure Legal Ethics Advice
Proposed Rule 1.05(c)(9) of the Texas Disciplinary Rules of Professional
Conduct specifically clarifies that a lawyer is permitted to disclose
confidential information to secure legal advice about the lawyer’s
compliance with the Texas Disciplinary Rules of Professional Conduct.
The purpose of this rule change is primarily to confirm that lawyers may
consult ethics counsel and disclose confidential information to the
extent necessary to obtain appropriate advice.
Ballot Item C: Confidentiality of Information – Exception to Permit
Disclosure to Prevent Client Death by Suicide
Proposed Rule 1.05(c)(10) of the Texas Disciplinary Rules of
Professional Conduct permits a lawyer to disclose confidential
information when the lawyer has reason to believe it is necessary to do
so to prevent a client from dying by suicide.
In these days of mounting mental health issues, this is an important exception that may save lives. Most importantly, as lawyers are not trained as mental health professionals, there is no requirement that a lawyer act on this rule. If he or she chooses not to do so, that decision cannot be held against the lawyer under this provision. This is permissive—not mandatory.
Ballot Item F: Reporting Professional Misconduct and Reciprocal
Discipline for Federal Court or Federal Agency Discipline
Many lawyers are not aware that several wide areas of federal practice,
such as patent law and immigration law, operate their own grievance
systems. This rule requires that a Texas lawyer who has been disciplined
in one of these non-state systems owes the same duty to report that
discipline as is owed when disciplined by a state system. This proposal
amends Rule 8.03 of the Texas Disciplinary Rules of Professional Conduct
and Rules 1.06 and 9.01 of the Texas Rules of Disciplinary Procedure by
extending existing self-reporting and reciprocal-discipline provisions
to cover certain professional discipline by a federal court or federal
agency. The proposal specifically limits “‘discipline’ by a federal
court or federal agency” to mean a public reprimand, suspension, or
disbarment. The proposal clarifies that minor infractions, such as
failure to timely pay annual fees or bar dues, or letters of
admonishment or warning, or disqualification as counsel, are certainly
not reportable acts.
Ballot Item G: Assignment of Judges in Disciplinary Complaints and
Related Provisions
When a lawyer accused of misconduct is notified of the finding of
“just cause” by the Office of Chief Disciplinary Counsel, he or she may
choose within 20 days to have the matter heard in district court. Under
the current rules, the Supreme Court assigns a district judge from a
different judicial region to hear the case. These proposed rule changes
simplify the assignment of such judges by: 1) transferring judicial
assignment duties from the Texas Supreme Court to the presiding judges
of the administrative judicial regions when a respondent in a
disciplinary complaint elects to proceed in district court; 2) relaxing
geographic restrictions on judicial assignments in disciplinary
complaints; and 3) clarifying and updating various procedures involved
in the assignment of judges in disciplinary complaints.
Ballot Item H: Voluntary Appointment of Custodian Attorney for
Cessation of Practice
Proposed Rule 13.04 of the Texas Rules of Disciplinary Procedure
authorizes a lawyer to voluntarily designate a custodian attorney to
assist with the designating attorney’s cessation of practice and
provides limited liability protection for the custodian attorney. For
many years, the Rules of Disciplinary Procedure have included so-called
emergency provisions in Rules 13.01, 13.02, and 13.03 for a district
court to appoint one or more custodians (similar to what we’d call a
“conservator”) to assume jurisdiction over an attorney’s practice when
that attorney is unable (for a number of reasons outlined in Rule 13.02)
to continue the practice. The benefit of that custodianship is that the
appointee(s) are protected from claims except for “intentional
misconduct or gross negligence.” It’s a very good and useful tool. So,
why not give lawyers an additional voluntary option to create those
custodianships and save on court time and costs? That’s what this new
rule does: allows a simplified voluntary procedure to appoint a
custodian to help wind up the practice of a lawyer who has ceased
practicing and affords those custodians the same protections for
undertaking those tasks.TBJ
CLAUDE DUCLOUX
is a past president of the Austin Bar Association and past chair of the
Texas Board of Legal Specialization, the Texas Bar College, the Texas
Center for Legal Ethics, and the Texas Bar Foundation. He has been
heavily involved in legal ethics matters throughout his career.
