Update on the Next Edition:
Before addressing this month's topic, here is a word about progress of the treatise. The goal is to have all Rules covered in a new edition of the treatise, to be posted early in 2014. First drafts have been completed on all but a handful of Rules.
This Month's Topic: Solicitation of New Clients
This month’s blog provides several questions about which solicitations of new clients are and are not permitted under Rule 7.3. More answers than questions are provided, because authorities disagree on some issues. I noticed these issues and disparities while drafting the chapter on Rule 7.3 for the treatise, Minnesota Legal Ethics. The Q & A below are a shorter, livelier version of the chapter on Rule 7.3.
1. “Ambulance Chaser”
In 2009, I was giving a talk about American legal ethics to a bar group in Verona, Italy. The meeting room overlooked a piazza with a statute of Dante, who composed part of The Divine Comedy in Verona. My daughter, Maura Campanelli, translated my presentation and the Q & A. A lawyer asked a question, in Italian, except that, in referring to American lawyers’ marketing practices, he used the English words “ambulance chaser.” Laughter from the audience indicated that no translation was needed. I tried to explain how and why American lawyers are permitted some solicitation opportunities and denied others. The First Amendment and broadening protections for commercial speech are big parts of the answer.
2. What Does Rule 7.3 Provide? Why?
Here is a link to Rule 7.3, which governs solicitation of prospective clients. Rule 7.3(a) prohibits solicitation by lawyers by “in-person or live telephone contact,” but provides several exceptions. Rule 7.3(b) prohibits other, less personal solicitations, if they’re really heavy-handed (“coercion, duress, or harassment”) or they’re obviously unwelcome. Rule 7.3(c) requires the label “Advertising Material” on certain “written, recorded and electronic” solicitations.
3. Yesteryear's Mantra - "Solicitation Bad – Advertising OK"
A. Say What? In distinguishing solicitation from advertising, a leading commentary states - far too broadly - “Solicitation... is entitled to little if any constitutional protection, and is typically either heavily regulated or prohibited altogether, sometimes prophylactically.” 2 Geoffrey C. Hazard Jr., W. William Hodes & Peter R. Jarvis, The Law of Lawyering § 57.2 (3d ed. Supp. 2009). In fact, solicitation cannot, constitutionally, be “prohibited altogether.” Indeed, Rule 7.3, roughly speaking, permits as much solicitation as it prohibits. Much of Rule 7.3 has been, in effect, dictated by First Amendment jurisprudence of the last thirty or forty years.
B. Written Solicitation. Written solicitation is permitted both by the Constitution and by Rule 7.3, subject, in many states, to labeling requirements and subject, in fewer states, to timing limits (e.g. not more than X days after an accident). Lawyers distributed a brochure stating, "Women who have used Dalkon Shield may be entitled to Financial Compensation." In re Appert, 315 N.W.2d 204, 215 (Minn.1981). They also sent letters to clients, former clients, and others, describing the firm’s ability to handle Dalkon Shield cases. The materials were not false or misleading. The court found the prohibition on such communications unconstitutional. The court found the difference between solicitation and targeted advertising insignificant. “The analysis to be made in either case is essentially the same.” Id. at 212.
C. Oral Solicitation. Even oral solicitation is permitted in several situations. Rule 7.3(a)(1)–(2). I may, for example, try to land MN Mega-Corp. as a client by sidling up to its in-house counsel and popping the question.
4. Why may CPAs, But Not Lawyers, Solicit by Phone?
A. The Disparity. Live oral communication, initiated by a lawyer, in person or by phone, with the purpose of soliciting a representation is said to be, “fraught with the possibility of undue influence, intimidation, and over-reaching.” Rule 7.3 cmt. 1. On the other hand, the First Amendment does not permit states to forbid accountants to solicit by phone. Edenfield v. Fane, 507 U.S. 761 (1993). Why?
B. Short Answers. (1) Because lawyers are wily devils, trained in the arts of persuasion, and accountants aren’t. (2) Because accountants’ client prospects are rarely found in an ambulance or emergency room. This is a rough-and-ready synopsis of Edenfield. In addition, as explained below, in many situations lawyers may solicit by phone.
5. What is "Solicitation?”
A. An ABA Definition. Minnesota has not defined “solicitation.” Some Minnesota case law, discussed below, indicates that the distinction between “advertising” and “solicitation” is often of no disciplinary significance. However, because Rule 7.3 has specific requirements and applies expressly only to “solicitation,” a definition would be useful. In 2012, a new ABA Model Rule Comment defined solicitation, as follows: “A solicitation is a targeted communication initiated by the lawyer that is directed to a specific person and offers to provide, or can reasonably be understood as offering to provide, legal services. In contrast, a lawyer’s communication typically does not constitute a solicitation if it is directed to the general public, such as through a billboard, an Internet banner advertisement, a website or a television commercial, or if it is in response to a request for information or is automatically generated in response to Internet searches.” ABA Model Rule 7.3 cmt. 1. This definition contrasts “solicitation” with both advertisements and with lawyer responses. There may well be marketing communications that do not fall clearly into one of these categories, but for most purposes the definition is useful.
B. Solicitation Without Popping the Question. A lawyer (L) received a resume from an applicant (A) for a secretarial position. A had no relevant qualifications. However, L noticed that A mentioned an on-the-job injury. L called A and discussed A’s injury and workers compensation claim. L never explicitly asked whether A would hire L. A disclosed that he was already represented by another lawyer. OLPR issued an admonition, charging L with solicitation. A Lawyers Board panel affirmed. On further appeal, the supreme court affirmed, rejecting L’s claim that he did not solicit. The court found L had a pecuniary motive and an intent to gain a client, and that his actions and words furthered his motive and intent. In re 97-29, 581 N.W.2d 347 (Minn. 1998). The author represented L.
6. May Lawyers Solicit by Texting Prospective Clients?
A. Why Not? We are Americans, so we start with the presumption that speech, including commercial speech, is permitted. To meet First Amendment standards, a government interest asserted in limiting the speech must be substantial; the regulation must directly advance the government interest asserted; and the regulation must be a "reasonable fit" to achieve the desired objective. Central Hudson Gas & Electric Corp. v. Public Service Commission of NY, 447 U.S. 557 (1980).
B. Written Solicitation Generally not Prohibited. Written solicitation is generally permitted, because it “poses much less risk” than oral solicitation, because the writing will “lack the coercive force of the personal presence of a trained advocate.” Zauderer v. Off. of Disciplinary Counsel, 471 U.S. 626, 642 (1985).
C. May Lawyers Solicit by “Real-Time Electronic Contact?” Who Cares? Almost all U.S. jurisdictions have adopted the ABA Model Rules, with local variations. Model Rule 7.3(a) prohibits solicitation by a certain kind of writing, viz. “real-time electronic contact.” Because Minnesota thought this prohibition might well violate the First Amendment, Minnesota did not adopt it. If, however, a Minnesota lawyer solicits a case in another state, by “real-time electronic contact,” the other state’s Rule will apply. Rule 8.5(b).
D. What About Texting? Ethics mavens are now debating whether texting is “in-person,” or “real-time electronic contact,” or not. Texting is clearly not “in-person.” Among the reasons for this conclusion is that the First Amendment does not permit stretching prohibitory terms, so that “in-person” would include, “at a distance of ten or five hundred miles.” Whether texting is “real-time” doesn’t matter in Minnesota.
7. Exceptions to Prohibitions
A. Exceptions. Rule 7.3 permits in-person and telephone solicitation in several circumstances, where the danger of overbearing the solicitee’s will is limited.
B. Lawyer. The largest exception in Rule 7.3 benefits big firms, because they can personally solicit corporate and governmental clients, via their in-house counsel. Rule 7.3(a)(1). Of course, competitors can do so too.
C. Pro Bono. First Amendment jurisprudence is, again, the source of a Rule 7.3(a) permission, for solicitation when pecuniary gain is not “a significant motive.” NAACP v. Button, 371 U.S. 415, 83 S.Ct. 328 (1963).
D. “Family.” A lawyer (L) learns that a second cousin, once-removed has been injured in an auto accident. May L solicit the case? It appears so. Rule 7.3(a)(2) restricts “personal relationships” to those that are “close,” but the Rule has no parallel restriction on “family.”
E. The Sid Hartman Exception. Lawyers may solicit those with whom they have a “close personal relationship.” Rule 7.3(a)(2). A leading commentary gives an interpretation of this term that, in the author’s view, is unduly restrictive. “Being an old college roommate should not qualify as a ‘close personal relationship,’ without more.” 2 Geoffrey C. Hazard Jr., W. William Hodes & Peter R. Jarvis, The Law of Lawyering § 57.5 illus. 57-1 (3d ed. Supp. 2008). A lawyer successfully defended an OLPR charge of Rule 7.3 violation by pointing out that he was a high school classmate of the solicitee. (I have heard this story from a lawyer who formerly worked at OLPR.)
F. “Prior Professional Relationship.” In-person solicitation is permitted where there is a “prior professional relationship.” Rule 7.3(a)(2).
1. Calling the Firm’s Clients. A lawyer (L) has recently left a law firm (F), to open a solo practice. L now calls and solicits C and X, who are clients of F. While L worked for F, L had provided services to C, but not to X. L is clearly permitted to call and solicit C. Rule 7.3(a)(2). May L solicit X by phone? It seems not, although if F was a small partnership and L had been a partner in F, some argument could be made.
2. Dentist. A lawyer (L) has received treatment from a dentist (D) for some years. L learns that D has been seriously injured in an auto accident. May L call D to solicit the case? Two authorities say “no,” but in the author’s view they are mistaken. A leading commentary states, without support in the Rule, that solicitation should not be permitted “merely because the two were in a ‘professional’ relationship.” 2 Geoffrey C. Hazard Jr., W. William Hodes & Peter R. Jarvis, The Law of Lawyering § 57.5, at 57-9 (3d ed. Supp. 2008). But the Rule permits exactly what the commentary says “should not be.” OLPR has suggested “prior professional relationship” means, “essentially former clients.” Martin A. Cole, Advertising: The Song That Never Ends, BENCH & B. OF MINN., May/June 2008, at 16, 16. However, the term “professional relationship” is clearly broader than “attorney-client relationship.” Rule 7.3(a)(2), read literally, permits L to call D. Because numerous other Rules are expressly based on an attorney-client relationship, the drafters knew that “professional” was a broader term.
3. Town Clerk. In the late 1980s OLPR charged a lawyer (L) with improper solicitation. L directly solicited a person (S) in a hospital, where S was beginning recovery from grievous injuries. L’s defense was that L had represented a township, which S had served as clerk, and this was a prior professional relationship. After a hearing, a Lawyers Board panel dismissed the charge. (These facts are based on the author’s memory. The author presented the charges, and the file has been expunged for many years, but the result was sufficiently surprising to the author that the memory remains reasonably clear.)
8. Exceptions to Exceptions – More Prohibitions
A. Additional Prohibitions. Even where solicitation would be otherwise permitted, it is forbidden in two situations – where the lawyer knows the solicitee wishes not to be solicited and where the solicitation would be unusually heavy-handed. Rule 7.3(b)(1) and (2).
B. Unwelcome or Welcome. Solicitations known to be unwelcome may not be made. Rule 7.3(b)(1). On the other hand, a lawyer may respond to requests for communications about legal services, from the solicitee or others on behalf of the solicitee, without violating prohibitions on solicitation. In re McDonald, 204 Minn. 61, 282 N.W. 677 (1938); In re Appert, 315 N.W.2d 204 (Minn.1981).
C. Fired Lawyer? When does a fired lawyer know he or she has been fired and should not contact the putative former client? Sometimes a lawyer (L) may receive a letter from an attorney (A) stating a client (C), whom L has been representing, is now represented by A. The letter may also state that A is communicating to L, C’s desire not to be contacted further by L. L may have reason to doubt the accuracy of A’s representations, but both Rules 7.3(b)(1) and 4.2 may appear to prohibit further contact. In April 2005, the author obtained an advisory opinion from OLPR that in the above circumstances, L may contact C to determine the accuracy of A’s representations.
D. Any Harm in Asking Twice? A comment interprets Rule 7.3(b) aggressively. “Moreover, if after sending a letter or other communication to a client as permitted by Rule 7.2 the lawyer receives no response, any further effort to communicate with the prospective client may violate the provisions of Rule 7.3(b).” Rule 7.3 cmt. 5. In the author’s view, the solicitee’s silence could not be interpreted as having “made known to the lawyer a desire not to be solicited by the lawyer,” under Rule 7.3(b)(1). Nor would asking twice involve “coercion” or “duress.” Rule 7.3(b)(2). Extreme and unusual circumstances would be required before asking twice would be “harassment.” Id.
E. Discipline for Really Offensive Solicitation. In one case, a lawyer was disciplined for a solicitation that was very offensive, but did not violate a specific Rule. “Alabama attorney Robert Norris had a wreath delivered to a funeral home for the family of a recently deceased infant. Norris attached a brochure describing his firm, and a letter of condolence, which concluded with an offer to be of assistance. The Alabama Supreme Court suspended Norris for two years, stating ‘Norris’s actions were clearly conduct that was not specifically permitted by the rules, but were actions that a literal reading of the rule would not prohibit.’ Norris’s challenge to the rule as unconstitutionally vague was rejected because his conduct showed ‘an indifference to the purpose and spirit of the rule.’ The U.S. Supreme Court denied a petition for certiorari. Norris v. Alabama State Bar, 582 So.2d 1034 (Ala. 1991), cert. den. 112 S.Ct. 417 (1991).” William J. Wernz, Potpourri, Bench & B. of Minn., Jan. 1992, at 11, 11. In Minnesota, Norris would have been professionally scorned, but not disciplined. The Norris discipline was based in part on violation of former DR 1-102(A)(6), which forbade “other conduct that adversely reflects on . . . fitness to practice law.” The Alabama theory seems to have been that really offensive conduct, that comes close to the prohibitions of a disciplinary rule, warrants severe discipline.
9. Labeling Targeted Mailings
A. Constitutional Protections. Lawyers have long been permitted to advertise, through the media, to targeted groups of potential clients. Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985). Lawyers may also seek such clients via US mail, e-mail, etc. but states may impose reasonable labeling requirements. Shapero v. Ky. Bar Ass’n, 486 U.S. 466 (1988).
B. Manner of Labeling. Lawyers should strictly follow the labeling prescriptions of Rule 7.3. A lawyer who deviated somewhat was admonished even though the Rule violation was “technical.” In re M.D.K., 534 N.W.2d 271, 271 (Minn. 1995).
C. Which Mailings Must be Labeled? The label “Advertising Materials” must be affixed to certain “written, recorded, or electronic communications” that solicit employment. Rule 7.3(c). The solicitee must be “known to be in need of legal services in a particular matter” before the label is mandated.
D. “In a Particular Matter?” No.
1. Labeling is not required unless the lawyer actually knows the prospective client is “in need of legal services in a particular matter....” Rule 7.3(c). “Particular” and “particular matter” are frequently used in the Rules, to refer to a specific representation or party. For example, “matter” is defined to mean, “other particular matter involving a specific party or parties, ....” Rule 1.11(e). Interpretation of “particular matter” should contrast the specific with the general.
2. “General announcements,” such as changes in personnel or location are not solicitations at all. Rule 7.3 cmt. 7.
3. A mailing to all businesses or governmental entities in an area does not involve a “particular matter.”
4. A mailing to all residents of Burnsville, touting the sender’s ability in estate planning does not involve a “particular matter.” The sender supposes the addressees are all mortal, and most have estates, but these are not particular matters. An investigation by the Office of Lawyers Professional Responsibility (OLPR) is authorized only “upon a reasonable belief that misconduct may have occurred.” Rule 8(a), R. Law. Prof. Resp. Notwithstanding the lack of such a reasonable belief, OLPR investigated (or at least kept a largely inactive file open for many months) a mailing of this type, before finally dismissing. I represented the respondent.
E. “In a Particular Matter?” Yes.
A lawyer who knows that the solicitee was injured, or is defending a mortgage foreclosure, must label a solicitation, “Advertising Materials.”