Robert Bennett speaks up

Back on April 1, I wrote about the disbarment of Robert Bennett (see "On irony and ethics"). The State Bar initiated disciplinary proceedings against Mr. Bennett as the result of a fee dispute. During the process, the State Bar recommended a one to two year suspension with all but the first three months probated - a fairly typical settlement offer.

At trial, however, it is the judge who decides the appropriate sanction and, in this case, despite not being requested by the State Bar, the judge presiding over the trial, ordered that Mr. Bennett be disbarred.

The details in my post came from a story in Texas Lawyer and from Mr. Bennett's Avvo listing and website. To be fair, after the judge disbarred him, Mr. Bennett contact Avvo and requested that any reference to him being a licensed attorney be removed.

I received an e-mail from Mr. Bennett over the weekend that presents his side of the dispute. In order to prevent anything from being "lost in the translation," here is Mr. Bennett's 17-point refutation of the charges brought against him and the finding of the court.

1. In forty years of practicing law I have never received a public or private reprimand;
2. The OCDC Attorney Tim Bersch did not call a single Testimonial witness in either the trial phase or Sanctions phase of the case;
3. The Only evidence the OCDC presented was the original contract that required the client to have a third party attorney approve and advise regarding the  engagement along with motions and documents pertaining to  District Court Hearing and appeal to the court of Appeals;
4. The Court refused to allow my experts to testify about why there were no rule violations committed;
5. Please review the letters attached to our MNT from Lillian Hardwick, the co-author of the Handbook of Texas Lawyer and Judicial Ethics and former Chairman of the Bar Ethics Committee; Dan Naranjo, former United States Magistrate and former member of the Commission for Lawyer Discipline ( the Plaintiff in the lawsuit), and Board Certified Attorney Don Karotkin, who served as a Chairman of a Grievance Committee in Houston, and Anthony Griffin who is one of the leading civil rights attorneys in the state and has been the subject of  bar matters;
6. The letters show that the Bar has presented experts in their cases previously and with the Court stating it had never tried a disbarment case previously, we certainly thought it would be helpful for the Court to hear from ethics experts;
7. No one on the Arbitration panel, at the district court , or on the appellate court considered that I had violated any rules in handling the case ( in fact the Court of Appeals found my brief to be reasonable);
8. I would also call your attention to the Court of Appeals decision that found that it disagreed with our view of the Arbitration but found that the appeal was reasonable. The complainant did seek sanctions against me before the Court of Appeals but that was denied because the appeal was a reasonable appeal;
9. We have not received the transcript from the Trial, but Mr. Bersch stated that no  Rule violations occurred with the writing of the Contract, the handling of the case, the arbitration, the objections and hearing in the district court. It was only after I believed the Arbitration Panel had exceed its authority and other issues required the arbitration to be vacated that I committed misconduct when I gave notice to appeal instead of paying the money to Mr. Land. In other words, when I decided in August of 20 2012 to appeal to the Court of appeals, I had not right to do that and that violated 3.02.  I had no right to challenge the district court decision.
10. Although a supersedes bond was posted, protecting the client if I should lose the appeal, Mr. Bersch citing no case authority and with no expert presented, decided that the appeal was a  violation of Disciplinary Rule 3.02.  If you will read the rule, the first comment makes reference to  what the Attorney who is representing the client does. You can’t grieve a client, so the rule is aimed at the attorney who is representing a client and engages in delay. Comment 2 states that the attorney who complies with Rules 3.01,and 3.02, and 3.03 complies with 3.02.  The Bar made no allegation that I had violated any other rules. Additionally, if you will read the letters attached to the MNT, you will see that Ms. Hardwick,  and experts Judge Naranjo, Don Kartokin and Anthony Griffin all agreed that  I did not violate Rule 3.02.
11. The other violation involved the failure to return an unearned fee at the time of the termination. The Rule states: “Upon Termination of representation”.  At the time Mr. Land and I parted ways, the fee he had paid had been used and he was in arrears on his account. All of this was documented and he was billed monthly. So when I was “ terminated” in June of 2011, there was no unearned fee, there was a fee dispute that took us to arbitration and a year later a decision by the District Court. No case has ever been found, no expert has ever opinioned that  you can have a “ relation-back” theory of termination. That is why all my experts said that there was no violation of Rule 1.15(d).
12. Moving on to the Sanctions part of the case. Again, Mr. Bersch did not offer a single witness on any of the  items contained in Rule 3.10 – Disciplinary Procedure Rules.  He did not call the complainant, the complaint’s attorney, nor did he call himself to prove up attorneys’ fees – very unusual, unless you don’t want to be cross examined. ( as an aside, the billing statement that Mr. Bersch wanted to be admitted into evidence did not contain any time  for meeting with or talking to any fact or expert witness).
13. Under the Terms of the Contract with the Complainant  Land, the governing rules required adherence   to the  Rules of the  HBA FDRC. Under the FDR ( Rule 8.02 (a)), any “decision may be reviewed by petition to a court having jurisdiction in accordance with the provisions of the Texas Arbitration Act.” (“TAA”). The decision from the Arbitration Panel is governed by the Rule of the Houston Bar Fee Dispute Resolution Committee subject to the TTA.  Under the TTA, regarding the right of appeal, the TTA states:  under  Texas Civil Practice & Remedies Code Section 171.098 - Appeal : a party may appeal and “ The appeal shall be taken in the manner and to the same extent as an appeal from an order or judgment in a civil action.”  Thus, if I had a right to appeal, there could be no violation of DR 3.02. What about the right of any litigant to appeal?
14. We placed on the stand 8 witnesses who showed there was no basis for a disbarment. Those included;

1. Ethics Expert Lilliana Hardwick: 512-xxx-xxxx;

1. Judge Dan Naranjo: 210-xxx-xxxx;

1. Attorney Don Karotkin: 713-xxx-xxxx

1. Attorney Anthony Griffin: 713-xxx-xxxx;

1. Client Anthony Graves:  713-xxx-xxxx;

1. Attorney  and Client Peyman Momeni: 713-xxx-xxxx;

1. Attorney Jeff Wagnon: 979-xxx-xxxx.

1. Attorney Jorge Lopez: 281-xxx-xxxx

15. It was also interesting that none of the 9 witnesses (I also testified)  were crossed examined or impeached in any way.  Mr. Bersch passed on the opportunity to ask any questions  of any of the defense witnesses or experts. Any of my witnesses would welcome a call if you would like to know more about the case.
16. After we exhausted our appellate remedies, we did not oppose Mr. Land getting paid, and it is my understanding that he had been paid.
17. The Bar was asked by the Court what its recommendation was and it was the same recommendation at the Sanctions phase as it was prior to the trial: One year probated up to two year probated with a three month active suspension.  The Court asked Mr. Bersch about a disbarment and he stated that he was not authorized to request that. Again, when we get the transcript, you can verify that.

Mr. Bennett has filed a motion for new trial he hopes to have heard before May 15.

In an e-mail to me, Mr. Bennett raised some very good points regarding the State Bar's Office of Chief Disciplinary Counsel. I do agree with him that something seems to be out of whack when an attorney with no disciplinary blemish on his record after 38 years of practice is disbarred over one fee dispute. It is also troubling that a judge would order disbarment when that particular remedy was never asked for by the State Bar.

  Bennett Motion for New Trial

A little cognitive dissonance on the side, please

One thing you can't accuse the State Bar of Texas of is having a post-modern sensibility. There's little sense of self-awareness and not a hint of irony in the monthly Texas Bar Journal. Maybe that's because the State Bar has always been by and for the white shoe firms in Houston and Dallas.

It certainly doesn't help that all of us who practice in Texas are blackmailed into joining the State Bar. Fail to pay your annual dues and you'll find yourself unable to practice law legally in the Lone Star State. With a captive audience (and big firms that pay the dues of all its lawyers), there is no incentive for the State Bar to take any other perspective other than what's good for Baker & Botts (or feel free to substitute any BigLaw firm in its place) is good for the profession.

I don't need to tell you what a colossally illogical statement that is.

In the current issue of the Texas Bar Journal we hear from Heather Venrick, a third-year law student at SMU's Dedman School of Law. She's feeling a bit blue because she thinks SMU didn't quite tell her the truth about the state of the legal profession. She was told to keep up her grades, get into law review, join a bunch of student groups and clerk for a variety of firms. Such things, she was told, would help her get that dream job.

Only there is no dream job.

She was sold the typical law school white wash job. BigLaw isn't hiring. Ever fewer students are walking into a job that puts them in a BMW and a nice zip code. As unrestrained capitalism has forced its nose under the tent, firms are more and more concerned with the bottom line than providing service to their clients. Add that to the glut of graduates from law school and you get a capitalist's wet dream - a desperate work force with far more people than jobs. Even the most ardent disciple of Ayn Rand knows what that means.

Of course it wouldn't be the State Bar without an upbeat (unrealistic) attitude, now, would it? Despite her inability to find her dream job, Ms. Venrick is still happy she decided to pursue her dream of becoming a lawyer.

Ms. Venrick might want to read The Lawyer Bubble: A Profession in Crisis, a book that I reviewed back last April. In fact, if you're considering law school, you need to pick up a copy and read it. If you choose to enter the legal profession, you need to do it with eyes wide open.

But if there is a shortage of jobs and a surplus of applicants, why not just shut that spigot down and reduce the supply of new lawyers? That would be the logical thing to do, wouldn't it?

Only there's money to be found in operating a law school. Students are forced to sit for three years when everyone will acknowledge that that's at least one semester more than necessary. Students are charged an arm and a leg to attend law school and pay for the academic Shangri-La it has become for those on the tenure track (maybe not so much for the ever increasing number of adjunct faculty). High tuition rates are subsidized by the government with easy money being doled out to those reaching for the brass ring. The loans can't be discharged in bankruptcy so the schools and banks are guaranteed their pound of flesh.

And into that breach has stepped the University of North Texas Dallas College of Law - the newest law school in Texas. And, without even a hint of irony, the Texas Bar Journal ran a fluff interview with the dean of the new school right after Ms. Venrick's attempt at venting.

We find out in the course of the interview that UNT's mission is to provide a "top-notch" legal education at a bargain price for those who might not be able to get into one of the state's other law schools. Now I'm all for expanding opportunity but who the fuck are we kidding? There is no market for another 120 lawyers a year in Texas.

The only beneficiaries to this newest law school will be the University of North Texas who will be counting the cash rolling in thanks to subsidized student loans and the BigLaw firms who will see even more downward pressure on wages.

The addition of even more new lawyers on the market will only serve to get us closer to the end of the race to the bottom. More new lawyers than the market can bear means more lawyers walking down the street wearing hot pants looking for that next new lead dangling from the marketeers' back pocket.

But it will also mean more money for UNT, the State Bar of Texas and the ABA -- and isn't that what it's all about anyway?

A million dollar flat fee? Why not?

If you're a criminal defense attorney you know by now that the State Bar of Texas is none too happy that you charge your clients a flat up-front fee for your services. It's just so out of touch with the big retainer and hourly fee structure that the white shoe firms think was inscribed on the tablets that Moses brought down from the mountain.

But, as it turns out, the problem might not be the nature of the fee arrangement - the problem may be that you just aren't charging your clients enough up front. The University of Texas has shown, once and for all, that bigger is better and of no concern to any authority.

For, you see, UT is paying a Washington, D.C. white shoe firm the grand sum of $987,000 to defend its use of affirmative action in its admissions process before the U.S. Supreme Court. My first thought was why the firm didn't just charge a cool mil. What's another $13,000 anyway?

Thanks to Ralph Haurwitz over at the Austin American-Statesman, we have a copy of the contract the Board of Regents signed with the firm of Lathan & Watkins, LLP.

Now, without getting into the merits of the arguments in favor of, or opposed to, UT's current admissions rules, is the fee worth it? There are around 50,000 students at UT-Austin, with the amount the board is spending to defend one lawsuit, those students could see their tuition reduced by almost $20,000. That would certainly go a long way to reducing the amount of debt college students are saddled with as they step out into the job market.

But let's say the university and the state are both satisfied with the representation those white shoe boys in Foggy Bottom are providing. Doesn't that make the fee worth it - regardless of how much that fee was?

And, if that's the case, what business does the State Bar have in interfering with the fee agreements we enter into with our clients? Who's in a better position to determine whether a fee is fair or not - the client seeking the services or an organization that represents corporate and insurance defense firms?

Correction:

Okay, okay. My math is obviously a little shaky. Instead of $20,000 per student the actual figure would be $20.

Buck Files to head the State Bar

Congratulations are in order for the new President-Elect of the State Bar of Texas Buck Files of Tyler. Mr. Files will be the first criminal defense attorney to lead the State Bar.

Mr. Files won the election by a mere 481 votes out of the 21,210 votes cast. The win is another victory for the criminal defense bar and solo practitioners across the state following the defeat of the proposed ethics rules amendments earlier this year.

It is a cliche, but in an election like this, every vote counts. Thank you to everyone that voted (and campaigned) for Mr. Files.

It's time to stand up again

Once again it's time for the criminal defense bar to work together to give the State Bar of Texas a message. Votes for the next president-elect of the State Bar can be cast online until 5pm on May 2, 2011. This time around we actually have a choice.

Buck Files is a criminal defense attorney from Tyler, Texas. If his name sounds familiar it's because of his monthly column "Federal Corner" in The Voice of the Defense, the magazine of the Texas Criminal Defense Lawyers Association.

Unlike the lawyers from the "white shoe firms," Buck Files knows and understands what we go through on a daily basis. He knows and understands the way things work in the criminal defense bar. He knows there is a disconnect between the Texas Supreme Court, the bar leadership and Texas attorneys.

Like my colleague, Mark Bennett, I have concerns about Mr. Files' position regarding the recent referendum on the ethics rules. I don't know what Mr. Files' position is on Justice William Jefferson's declaration that the Court isn't satisfied with the results of that referendum. I feel confident that Mr. Files will at least listen to the members of the bar before trying to ram something down our throats again with our dues money.

We made our voices heard earlier this year. Now it's time to do it again. Send (another) message to the State Bar. Vote for Buck Files for State Bar President-Elect.

Sticking it to the solos

State Representative Burt Solomons (R-Carrollton) has authored a bill (HB1072) that would exempt attorneys employed by the State of Texas from having to pay "membership" fees to the State Bar of Texas. The bill is being promoted as a cost saver for the state.

The bill has passed out of the Judiciary & Civil Jurisprudence Committee this past week.

According to the fiscal analysis, there are 1522 full-time attorneys employed by the State of Texas. Each of those attorneys pays annual dues of $235 to the State Bar for the privilege of being an attorney in the Lone Star State. The passage of the bill will result in the State Bar's losing $357,670 a year for the next five years (assuming that the number of attorneys employed by the state remains constant).

Since the State of Texas pays the annual dues for the attorneys it employs, the bill would save the state $357,670.

The Comptroller of Public Accounts, however, says there are 2,778 attorneys employed by the State so the actual loss to the State Bar would be $652,830 a year.

The problem is the State Bar is going to want to recover that money from someone. And who would that someone be? Every attorney in private practice - or working for local governmental entities. Since firms tend to pay the membership dues of the attorneys working for them, the people who will be hurt the most are solo practitioners who have no one else to pay their bills.

I'm taking my ball and going home

After a referendum in which the State Bar's proposed disciplinary rules changes were defeated by about an 4-1 margin across the board, those behind the proposed changes still don't get the message that Texas lawyers made abundantly clear over the past month.

Wallace B. Jefferson, the Chief Justice of the Texas Supreme Court is so put out that he issued the following statement:

The Court is grateful to the many lawyers who contributed their time and wisdom to proposing revisions to the Texas Disciplinary Rules of Professional Conduct. The current rules are outdated, and must be amended to account for changes in the practice and in the law that have occurred since the bar last adopted comprehensive revisions 21 years ago. We intend to ask the Bar’s Board of Directors to make prompt recommendations about a timeline for future proceedings relating to the rules. In the meantime, the Court will consider what action, if any, may be necessary to carry out its responsibility to maintain standards of professional conduct that protect our justice system and the people it serves.

Much like the intellectually bankrupt leaders of the State Bar, the Chief Justice is unable to give a cogent answer as to why the rules need to be changed. Same theme, second verse -- if you can't come up with a better reason than how long it's been since the rules were last changed, then you don't have a good reason. The Bill of Rights seems to have worked (more or less) pretty well and the first ten amendments were written some 220 years ago.

Here's a hint for you, Mr. Jefferson, if you want a rule prohibiting sex between lawyers and their clients -- put it out for adoption on its own. I guarantee that had that rule change been put to a vote on its own, it would have passed overwhelmingly.

As to Mr. Jefferson's wanting to protect "our justice system," might I remind him that the Supreme Court's primary duty is to determine who gets whose money. I'm sure that's important to insurance companies and municipalities, but it has very little consequence on our citizens who find themselves the subject of a criminal prosecution.

Finally, the leadership of the State Bar wastes no opportunity to tell us we need to preserve self-governance in the profession. Well, Mr. Tottenham, if the State Bar is our form of self-governance, why is the Chief Justice of the Texas Supreme Court saying the Court will do what it wants to do, regardless of how we feel about it?

State Bar proposals go down in flames

The results are in and the leadership of the State Bar is still trying to wipe the egg off their faces after suffering a humiliating defeat in their attempt to revise the ethics rules in Texas.

Of course State Bar President Terry Tottenham, ever gracious in defeat, intimated that the Supreme Court would revisit the issue in the future.

“Texas lawyers elected not to adopt these rules. We expect that this will not be the end of the Supreme Court’s interest in making revisions to these rules.” -- State Bar of Texas President Terry Tottenham.

Interesting how after the lawyers of Texas rebuked his attempt to ramrod the changes down their throats -- using their dues money as added insult -- Mr. Tottenham now says the Supreme Court was behind the revisions.

Mr. Tottenham, the emperor has no clothes. Your arrogance, and the arrogance of the rest of the leadership, demonstrates that you are unfit to run this organization. You spent our money to advance your agenda. You could offer no compelling reason for any lawyer in this state to support the proposed rule changes. You grouped them together as a way of trying to manipulate the vote.

Our ethics rules might not be perfect, but they have served us for the past 20 years. There is case law interpreting the rules and most attorneys in Texas have a basic understanding of what we should and should not do. Change for the sake of change is bad policy and exposes the moral bankruptcy in the leadership of the State Bar of Texas.

Today is your last chance to vote

Cindy Owens and Michael Villasana and their colleagues with the Municipal Justice Bar Association of Texas urge you to tell the State Bar you don't approve of their proposed changes to the disciplinary rules in Texas.

Ms. Owens is the current president of the MJBAT and Mr. Villasana is the past president of the organization.

The Municipal Justice Bar Association of Texas, is urging you to Vote 'NO' on the State Bar Referendum and will give you some reasons to do so. 

1. We are an association of attorneys who practice in Municipal Courts and Justice of the Peace Courts throughout the State of Texas and some members practice also in the area of Criminal Law; 
2. The Municipal Court practice and Criminal Law practice has historically lent  itself to Flat Fees in that middle and lower income clients need to budget for all their needs including Attorney Fees. Many hire attorneys based on the fees they will be charged and/or the reputation of the attorney to be hired. This will be next to impossible for the attorney to assist them under the new rules, where they would either have to come up with a significant retainer or the attorney will have to bill hours in the future and hope they could collect after the case is finished. 
3. Could it be that with the advent of Texas 'Tort Reform', the Civil Defense Bar is tired of being boxed into Flat Fees by Insurance Companies.

Today is your last opportunity to vote. It no longer takes a majority of the membership to adopt the proposed changes -- it only takes a majority of those casting votes. Don't allow the rule changes to take effect by your apathy.

When the best argument in favor of the changes is that the last change was 20 years ago -- there isn't much reason to vote for the proposed rule changes. The State Bar has used your dues money to launch this effort and they have used more of your dues money advocating the changes. The leadership of the State Bar doesn't care what the membership wants or thinks. It's time to let them know that we're tired of their arrogance and disdain for those of us who defend those who have no voice.

An appeal to the other side of the well

I'm addressing this post to my colleagues "across the well" who work as prosecutors in the State of Texas. The proposed changes to the disciplinary rules have absolutely no bearing on how y'all conduct business. But I know that many of y'all will one day leave the DA's office and hang out your own shingle. Some of y'all will come over to the side of the angels and practice criminal defense. Others will go into other areas of the law.

Once you've left the employ of the government, the disciplinary rules will become a reality. If y'all haven't voted because you don't see how the rules would have any effect on your job, please consider what you and your colleagues may do down the road.

If you  go into criminal defense, the assault on the flat fee is going to affect you. You will find that out the first time you take on a client who can't pay your fee in full - or the first time you file a motion to withdraw because a client has decided not to pay you.

If you go into the civil arena (be sure to watch your back, because you never know whose knife is there), the rules on conflicts are going to become your own personal living hell when you try to determine if you can take on a new client.

There aren't too many issues on which we can fight alongside each other. This, however, is one. If you haven't voted, or if there are others in your office who haven't voted yet, please take the time to do so. Your ability to make your voice heard will end at 5:00 p.m. on February 17.

Time's running out to vote on rule changes

At 5:00 p.m. on February 17, voting on the proposed changes to the Texas disciplinary rules will come to an end. I'm fairly certain that most of the folks who plan on voting have already done so -- but I'm sure there are a few stragglers out there who haven't taken the time to vote yet.

Mark Bennett and I have written extensively about the proposed changes, but here are some more voices you might not have heard:

Jon Malone --

1. "The rules are poorly drafted, not needed, and benefit  neither  lawyers , clients nor the citizens of the State of Texas, for whom these rules were ultimately designed to protect.

    2.    The  State  Bar officers are lobbying and using their positions of power to affect the outcome of
            the vote on these matters, - a clear conflict of interest;

    3.    The State Bar is using funds obtained by our membership fees to lobby on political issues-
            an inappropriate and offensive use of  public funds."

*****

Michael J. Whitten --

"These proposed amendments, in my view, will be expensive to implement and do not really address anything that is a problem. The proposals are a classic example of appointing a committee to address a 'problem' and the committee feeling compelled to come up with a solution to the 'problem,' without having any empirical data to evaluate the degree and extent of the perceived problem."

*****

H. Deloyd Bailey --

"While we may need some revisions in our current rules, I agree that overall this fix flies in the face of the sage advice, 'If if ain't broke don't fix it.'"

Time's running out. If you haven't already voted, please cast your NO vote now. Don't be apathetic. Don't wake up one morning and wonder what the hell happened to the disciplinary rules. This is our chance to make our voices heard.

Does the State Bar even care about us?

I sat through three hours of CLE yesterday listening to the pros and cons of the State Bar's proposed changes to the Texas disciplinary rules.

First I listened to Amon Burton, Charles Herring and Jim McCormack tell me what was wrong with the proposed amendments. Well, to be honest, what was wrong with a small handful of them.

According to the State Bar, there will be no material changes to the rules as a result of the amendments. Mr. McCormack then asked the question that every lawyer in Texas should be asking: If you're not going to make material changes, why make the changes?

Just stop and think about that a bit. Let it sink in. So either the State Bar is proposing change for the sake of change or they're just plain lying about the effect of the changes.

As a rule of thumb, we make changes to address problems we encounter. If we're always late in the mornings we wake up earlier. If we think we weigh too much, we make changes in our diet.

In the context of the proposed changes, Mr. Burton wants to know what problem are these proposed changes meant to address. He also wants to know what goals the drafters of the proposed amendments had in mind. Finally he wants to know how much it's going to cost Texas lawyers to comply with the proposed changes.

Mr. Burton estimated that the 88,000 or so attorneys in Texas would each spend an average of 4.33 additional hours making sure they were in compliance with the new rules. He then estimated an average(?) billing rate of $262/hour for a total cost of $99,832.480. I'm not certain where he came up with his estimates, but I'm sure most of my colleagues on the defense bar would love to get a piece of that $262 an hour. It kind of puts into perspective how much counties car about providing quality representation for indigent defendants when the going rate in the Harris County area is anywhere from $50 to $100 an hour for appointed cases.

Then I listened to the State Bar's propaganda piece CLE and my head began to spin as I tried to keep up with the ball as it moved from cup to cup. First you had the State Bar's presenters tell us not to worry that the proposed changes differed from the ABA model rules. No one uses the ABA rules, they insisted. Then later on they said the State Bar used the ABA model rules as a guide or jumping-off point when drafting the rules. Then they told claimed there were no difference between the proposed changes and the ABA model rules.

Oh, lest I forget, the CLE began with an introductory video featuring the State Bar president, Terry Tottenham. And wouldn't you know it, the first thing out of his mouth was that it had been 20 years since the rules had last been changed and that was just too damn long. So that's your main selling point?

One of the presenters told us that some of the rules differed from the ABA model rules because the State Bar wanted the specifics of the rule to be found in the rule itself instead of being hidden in the comments. Then they all spoke of how we needed to read the comments for guidance in how to follow the proposed amendments.

We were told that attorneys who opposed the changes in the conflicts rules were probably acting unethically in the way they practiced. We were told not to worry about the changes in the confidentiality rule because Texas was already less stringent than the ABA on what constituted privileged communication between an attorney and a client.

And we were told it's not a good idea to sleep with a client or condition representation on the willingness of a client to sleep with you. Well, yeah, and if you juggle sharp knives you're likely to cut yourself to shreds.

The presenters also spent a good deal of time telling us how we needed to change the rules so we could show the legislature and the people of Texas that we could govern our profession ourselves. They seemed more concerned with the sunset review of the State Bar in 2015 than with how the rules affected criminal defense attorneys.

Interestingly enough, during the course of the entire three hours there was no one mention of the rules affecting  flat fees or IOLTA accounts. Not a one. Both presentations seemed geared toward attorneys working in large firms who might actually run across situations in which an attorney, or the firm, might be conflicted out of representation.

I really don't care about how large firms run conflicts checks when a prospective client walks in the door. I represent (for the most part) folks who are charged with committing criminal acts; and since I don't assist the state in its efforts to infringe upon the citizenry's rights and liberties, I have very little concern about being conflicted out of a case.

The State Bar of Texas doesn't care about those of who defend those accused of breaking the law. Is the self-governance of the profession really our concern?

The opposition grows

The number of organizations coming out against the State Bar's proposed changes to the disciplinary rules continues to grow:

• Texas Criminal Defense Lawyers Association
• Harris County Criminal Defense Lawyers Association
• Galveston County Criminal Defense Lawyers Association
• Houston Trial Lawyers Association
• State Bar of Texas Council of the General Practice, Solos and Small Firms Section (Props A,B,D and E)

If you know of any other organizations that have announced their opposition to the State Bar's proposals, please let me know so that I can add them to the roll.

Political propaganda disguised as education?

Not to be outdone by those opposing the proposed changes to the disciplinary rules, the State Bar of Texas has decided to bring out of retirement, a free two-hour CLE about the proposed changes. I'm sure that our dues money isn't being used for this propaganda push otherwise passing for continuing legal education.

According to the State Bar:

During this presentation on the proposed amendments to the Texas Disciplinary Rules of Professional Conduct, the panelists will touch on the process of amending the rules but will focus mainly on four of the proposed new rules – Rules 1.00, 1.13, 1.14. 1.17 – and the proposed amendments to four conflict-of-interest rules – Rules 1.06 through 1.09 – that have sparked considerable debate during the amendment process. This webcast is intended to help lawyers understand the current content of proposed rules that will go to a referendum between January 18 and February 17. Take advantage of this opportunity to learn about these proposed rules before exercising your right to vote.

With a panel made up of a former chair of the State Bar's committee on the disciplinary rules, the current chair of the Supreme Court's task force on the disciplinary rules and the Supreme Court's rules attorney, I'm sure you will hear a balanced assessment of the proposed changes.

Your state bar dues money in action

While killing time at the Galveston County Law Library, I came across this pamphlet on the proposed ethics rule changes. The pamphlet was produced using our dues money and toes the company line on the "need" for reforming the rules. There is no evidence in the pamphlet of any opposition to the proposed changes.

It's telling when the first thing the State Bar president mentions is that it's been 20 years since the ethics rules were last reviewed and changed.

In the January 2011 issue of the Texas Bar Journal Mr. Tottenham notes that "the practice of law has changed significantly over the past 20 years...For example, we did not use technology to the degree we do now." That's all well and good, but what on earth does technology have to do with trying to abolish the flat fee?

Mr. Tottenham, change for the sake of change is not only not a good idea, it's not good policy. If you can't come up with a better argument for changing the rules then I can think of no good reason the rules should be changed.

UT Law offers free CLE on proposed rule changes

For those of you who want more information on the State Bar's proposed disciplinary rules changes, the University of Texas is offering a free one-hour online CLE that addresses issues and problems with the proposed changes.

The CLE is free through January 29, 2011 and again from February 2-18, 2011. There will be a $35 fee for the CLE between January 30 and February 1.

The discussion is hosted by Amon Burton, Charles Herring, Jr. and Jim McCormack who have all spoken out against the proposals.

For more information, click here.

Just follow the money

What exactly is the impetus for changing the disciplinary rules in Texas? According to the State Bar, not approving the referendum would embarrass the Texas bar. I don't know how it could embarrass the state more than the Chief Judge on the Texas Court of Criminal Appeals telling the clerk's office not to accept an after-hours filing on behalf of a man scheduled to die at the hands of the state.

Maybe the assault on the flat fee and the attempts to change the rules so that criminal defense attorneys would have to park the money received on flat fees in a trust account is nothing more than a money grab by the State Bar.

The Texas Access to Justice Foundation receives the vast majority of its funding through the interest earned on IOLTA accounts in Texas. For those of you not familiar with this beast - an IOLTA account is a client trust account in which an attorney must place funds that haven't been earned and property received in settling a case. The interest earned on these accounts goes to the Texas Access to Justice Foundation to fund legal aid projects throughout the state.

According to the 2010 report filed by the TAJF with the Texas Supreme Court,

While the continuing effects of historically low interest rates devastate IOLTA revenue, the Texas Access to Justice Foundation continues to work on diversified sources of funding civil legal services for poor and low-income Texans. The Foundation projects approximately $5.5 million in IOLTA revenue for 2010 - a 73 percent decrease in IOLTA revenue from 2007. Current economic forecasts indicate little change in interest rates in the foreseeable future.

The Foundation and its partners in access to justice will be working diligently during the upcoming legislative session to support the Court's request for an appropriation of $20 million for the biennium for civil services to the poor to help fill the gap in funding created by the loss of IOLTA.

And, with a budget crisis looming in Austin as the legislature tries to figure out how to balance a budget without raising taxes, I wouldn't cross my fingers on legislators voting $20 million to aid the poor.

There's the reason for the proposed changes. Force criminal attorneys to park flat fees in IOLTA accounts so the State Bar can siphon the money to fund programs to offer low cost legal services to the poor for civil matters. So the combination of a sour economy and tort reform is behind the State Bar's all out push to change the way criminal defense attorneys conduct business.

Just follow the money, baby.

Let our voices be heard

Fellow counsel,

It's time to cast your vote on the proposed changes to the Texas disciplinary rules. You may vote online at the State Bar's website until 5pm on February 17, 2011. This is your opportunity to let the powers that be at the State Bar know you're upset with the manner in which the criminal defense bar is treated in this state. Let the State Bar know you are tired of the rules governing how we conduct our business being decided by BigLaw attorneys in Houston, Dallas and Austin. Remember that the people proposing these rules don't work in the trenches with those that no one else dares represent.

The State Bar has mobilized a campaign to force these changes down out throats and they're using our dues money to do it. Just take a look at the State Bar's website. Are there any dissenting opinions posted? No. The only information provided on their website is propaganda in favor of the proposed changes. To be fair there is an article from the bar journal that does include the reasons some attorneys plan to vote no to the changes -- but I harbor serious doubts that these responses were from a true cross-section of Texas attorneys.

The State Bar has taken our money (that we are required to hand over to them) and used it to pay for e-mail blasts that take aim at anyone who dares to challenge their orthodoxy. Anyone who undertakes such a campaign makes me want to know what they're not telling us -- or what they're afraid to admit.

Currently Rule 1.04(a) says that an attorney may not charge an unconscionable fee:

(a) A lawyer shall not enter into an arrangement for, charge, or collect an illegal fee or unconscionable fee. A fee is unconscionable if a competent lawyer could not form a reasonable belief that the fee is reasonable. 

According to the commentary on the current rules,

A lawyer in good conscience should not charge or collect more than a reasonable fee, although he may charge less or no fee at all. The determination of the reasonableness of a fee, or of the range of reasonableness, can be a difficult question, and a standard of reasonableness is too vague and uncertain to be an appropriate  standard in a disciplinary action. For this reason, paragraph (a) adopts, for disciplinary purposes only, a clearer standard: the lawyer is subject to discipline for an illegal fee or an unconscionable fee. Paragraph (a) defines an unconscionable fee in terms of the reasonableness of the fee but in a way to eliminate factual disputes as to the fees reasonableness. The Rules unconscionable standard, however, does not preclude use of the reasonableness standard of paragraph (b) in other settings. 

Under the proposed changes, Rule 1.04(a) would read:

A lawyer shall not enter into an arrangement for, charge,or collect an illegal or clearly excessive fee. A fee is clearly excessive when, after a review of the facts, a reasonable lawyer would be left with a firm belief or conviction that the fee is in excess of a reasonable fee.

The commentary for the proposed change states:

A lawyer in good conscience should not charge or collect more than a reasonable fee, although a lawyer may charge less or no fee at all. Thus, paragraph (a) subjects a lawyer to discipline when a reasonable lawyer would be left with a firm belief or conviction that the fee is in excess of a reasonable fee. But this paragraph’s “clearly excessive” standard does not preclude use of the “reasonableness” standard of paragraph (b) in other settings.

So, here's the rub. In the commentary to the existing rules we learn that it can be difficult to determine what is or isn't a reasonable fee and that such a standard would be "too vague" to use in disciplinary procedures, but the new rule talks about fees that are "clearly excessive" and the commentary indicates that a reasonableness standard should be applied to determine if the fee arrangement violates the rules.

That, my friends, is a tremendous change and a scary one at that. Who determines what's reasonable? Will it be other criminal defense attorneys in the area? Will it be other criminal defense attorneys who handle a particular type of criminal case on a routine basis? Will it be attorneys from BigLaw who have no idea of what goes down in the criminal courts or what is involved in defending a person accused of committing a crime?

In the course of less than six years, how did we get to a point where a reasonableness standard isn't too vague anymore?

The State Bar attempts to answer concerns from criminal defense attorneys that the new rules will change the way attorneys have to handle flat fee arrangements (or if such arrangements are even allowed). According to the State Bar

The proposed rule does not change this law (and it could not) and puts criminal defense lawyers in no worse or better position than the current rule.

Well, if that's the case, why change the rule at all?

I urge everyone to vote no to the proposed changes and I urge you to express your concerns to attorneys who practice outside the criminal courts.

For more commentary, please see:

• "Why flat fees are good for clients" Defending People (1/14/11)
• "What the State Bar thinks about flat fees" Defending People (1/15/11)
• "Are 10,000 Texas criminal defense lawyers wrong on flat fees?" Defending People (1/16/11)
• "Flat fees and the last Texas criminal defense lawyer" Simple Justice (1/16/11)
• "Shame on the Texas Bar, and us" Criminal Defense (1/16/11)
• "Memo to Texas Bar: Back off" Norm Pattis Blog (1/16/11)
• "Flat fee fight: What's really going on" Defending People (1/17/11)

It it ain't broke, fix it!

One of the purported rationales for the State Bar's decision to rewrite the disciplinary rules is that the ABA model rules have been modified since the Texas rules were implemented. If that's the case, shouldn't the Texas rules more closely mirror the model ABA rules?

Over the past few years I've read countless articles in ABA publications pronouncing the (premature) death of the billable hour. Article after article touts the benefits to clients of "value billing."

Additional ways to price legal fees include value billing and success-based fees. It always makes sense to talk about fees in terms of value. What separates you from your competitor is not simply that you will each do quality legal work, but that you provide a unique understanding of the value this service provides your client. Hourly billing can be the antithesis of value-based services. What is it worth to your client to avoid expensive litigation? What is it worth to your client to operate a business free from worry about meeting legal deadlines and having compliance issues handled in a timely and accurate manner? By providing a value added service you become a trusted advisor focused on your client’s business success, rather than a service provider sending monthly invoices. It is hard to quantify the value of prevention. But any client who has been through costly litigation should have an understanding of the value that a strong partnership with a legal advisor can bring.

That's from a 2005 article in Law Practice TODAY written by Wendy Werner entitled "Alternative billing practices beyond the billable hour."

Sound familiar? Clients come to criminal defense attorneys because they have a problem that needs solving. They need someone who's familiar with the law, the venue and the court. They come in looking for someone who can help them resolve their problem in a way they, and their loved ones, can live with.

Unlike civil attorneys, we don't charge the same amount to every client for drafting routine motions that only require headings, names and dates to be changed. We don't charge clients for the myriad of phone calls we receive and make regarding their cases. We don't charge the trips to the county jail on weekends or at night. We charge for our ability to handle their case and our knowledge of the facts, law and science involved.

We counsel our clients about what to expect as their case moves along. We put together grand jury and pretrial diversion packets when necessary. We negotiate for plea arrangements when that is in our clients' best interest. We stand beside our clients and fight like hell when the state tries to take away their liberty. We are hand-holders, teachers and orators.

In Comment No. 5 to ABA Model Rule 1.05 (the analogue to proposed rule 1.04 in Texas), the authors note that any fee arrangement must not be one that might cause the attorney to curtail services to the client:

An agreement may not be made whose terms might induce the lawyer improperly to curtail services for the client or perform them in a way contrary to the client's interest. For example, a lawyer should not enter into an agreement whereby services are to be provided only up to a stated amount when it is foreseeable that more extensive services probably will be required, unless the situation is adequately explained to the client. Otherwise, the client might have to bargain for further assistance in the midst of a proceeding or transaction. However, it is proper to define the extent of services in light of the client's ability to pay. A lawyer should not exploit a fee arrangement based primarily on hourly charges by using wasteful procedures.

As I have stated before, it is the flat fee arrangement that allows criminal defense attorneys to provide our clients with the best representation we can. According to the comment above, fee agreements should not be written in such a way that limits services when it is "foreseeable" that more is required. It is foreseeable that every criminal case may go to trial. Do away with the flat fee and clients will be forced to pay even more money to a defense attorney as a deposit against future expenses in every representation.

How does that benefit someone accused of a criminal offense? Most of our clients struggle to pay us the fee we quote. Do away with the flat fee and who will be able to afford to put down even more?

Strangely enough, the comments affixed to the proposed change in Texas doesn't contain the language I've quoted above. It would seem to me that if you want the Texas rules to mirror the ABA's rules you would include the same or, at least, similar, commentary.

ABA Model Rule 1.15(c) reads:

A lawyer shall deposit into a client trust account legal fees and expenses that have been paid in advance, to be withdrawn by the lawyer only as fees are earned or expenses incurred.

Comment No. 3 to the ABA Model Rule reads:

Lawyers often receive funds from which the lawyer's fee will be paid. The lawyer is not required to remit to the client funds that the lawyer reasonably believes represent fees owed. However, a lawyer may not hold funds to coerce a client into accepting the lawyer's contention. The disputed portion of the funds must be kept in a trust account and the lawyer should suggest means for prompt resolution of the dispute, such as arbitration. The undisputed portion of the funds shall be promptly distributed.

The ABA recognizes that not all representation is billed by the hour. According to the ABA commentary, a flat fee is reasonable when the lawyer believes the fee charged to be reasonable for the services to be rendered. There is nothing in the commentary to indicate that a flat fee is unearned.

However, the proposal for Texas Rule 1.15(d) - the analogue - reads:

A lawyer shall deposit unearned fees and advanced expenses into a client trust account, to be withdrawn by the lawyer only as fees are earned or expenses are incurred.

And comment No. 12 to the proposed makes it clear that the State Bar has flat fees in its sights:

Paragraph (d) addresses unearned fees. Fee agreements sometimes state that the fee is a flat fee, advance fee, nonrefundable retainer, or some other kind of fee. But without regard to the label, if the fee is a prepayment for services, paragraph (d) requires a lawyer to deposit the fee into a trust account until it is earned. Applicable law, not these Rules, determines when a fee is earned.

See the difference? The proposed change calls a flat fee an unearned fee which requires that an attorney hold that fee in trust until such time as it is earned. What does the State Bar want? Do they want us to bill our clients by the appearance -- thus dragging out cases needlessly or forcing clients to plead because they can't afford continued representation?

There is nothing inherently evil about a flat fee. Insurance companies have flat fee arrangements with some of the attorneys who handle their cases. The State Bar doesn't seem to have a problem with State Farm agreeing to pay a law firm a flat fee in exchange for that firm defending their insured over a car wreck. Of course State Farm will pay that fee after the case is resolved, regardless of the outcome. Just try collecting the balance of a fee after a client has been convicted and sent to prison.

The State Bar strikes back

Earlier today I received the following e-mail from Frederick Moss, a law professor at SMU and a member of the State Bar's ethics rules committee:

Mr. Kennedy: 

Let me correct one thing you said about the referendum on the changes to the ethics rules.  You said that the Bar is asking Texas Lawyers to vote all of the changes either up or down. That is incorrect.  The referendum ballot will bunch the changed rules into six separate votes, so if you oppose one or more rules, you can vote against them while you can vote for those you don't object to.

Second, you characterize the Bar president's claim that some of the criticism of the proposed rule changes are "misinformation" as calling the critics "liars."  This is not true (or fair).  The president is just saying that some of the information the critics are dispensing is wrong. He is not saying it is intentionally false. Many of the criticisms voiced are wrong, based, I believe, on a misunderstanding of the proposals and their compatibility with the current rules and the ABA Model Rules. "Misinformation" may be intended or unintended.

Thank you. 

Fred Moss 

Professor Emeritus, SMU Dedman School of Law,

Member of the SBOT ethics rules committee

PS, Could you please post this reply on your blog for me?  I tried to do so, but couldn’t figure out how to do an “open ID”.  Sorry.  I’m just not technologically adept.  Thank you. 

To Mr. Moss' first point, my original post was incorrect (it has since been corrected). Lawyers in Texas will be asked to approve six proposals encompassing a number of proposed rule changes. By bundling them together, the State Bar is using the "don't throw the baby out with the bathwater" argument. You might not like this proposed change, but look at the other ones in the proposal.

Sure, I think it's a really bad idea for a lawyer to sleep with a client. Nothing good can come of it. But while I may support that proposed change, I cannot support the proposals regulating advance fees or the changes to the rules regarding attorney-client privilege.

Rule 1.05. Confidentiality of Information

(a) "Confidential information" includes both "privileged information" and "unprivileged client information." "Privileged information" refers to the information of client protected by the lawyer client privilege of Rule 503 of the Texas Rules of Evidence or of Rule 503 of the Texas Rules of Criminal Evidence or by the principles of attorney-client privilege governed by Rule 501 of the Federal Rules of Evidence for United States Courts and Magistrates. "Unprivileged client information means.

(1) in the case of client or former client is all information relating to client or furnished by the client, other than privileged information, acquired by the lawyer during the course of or by reason of the representation of the client from whatever source, whether acquired by the lawyer personally or through an agent, other than information that is or becomes generally known or is readily obtainable from sources generally available to the public; and

(2) in the case of prospective client, as described in Rule 1.17. is information furnished to the lawyer by that prospective client, either personally or through an agent or other representative authorized to act on the prospective client's behalf, in the course of seeking legal representation, other than information that:

(i) is or becomes generally known or is readily obtainable from sources generally available to the public; or 

(ii) is furnished under the circumstances described in Rule 1.17(d)(2).

The proposed changes to Rule 1.05 mean that what's confidential isn't necessarily confidential. Should this proposal be adopted, when a client sits down and asks you if what he's telling you is confidential, the best answer you can give him is "it depends." I would like someone to explain to me how this aids in our representation of clients accused of committing criminal acts. It's not as big a concern in a civil suit because everything comes out before trial thanks to our civil discovery rules. It's a big concern in criminal prosecutions.

As to Mr. Moss' second point, the State Bar is burning up the internet with e-mails from Bar officials telling us why the proposed changes are the equivalent of sliced bread. Every one of these e-mails attacks the voices that raise questions about the new rules. And while the State Bar is sparing no expense to entice lawyers across the state to vote for changes, nowhere on the State Bar's website is there any dissenting opinion.

For another perspective on the proposed changes see Texas Rules Commentary. You won't find the same type of open discussion on the State Bar's website and you certainly won't see it in any of the e-mails you receive begging you to vote for the changes and attacking anyone who opposes them (which are paid for by your annual dues).