By Goodman H.B. No. 656 74R2763 PB-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to certain advertising by attorneys. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Subtitle G, Title 2, Government Code, is amended 1-5 by adding Chapter 84 to read as follows: 1-6 CHAPTER 84. ATTORNEY ADVERTISING 1-7 SUBCHAPTER A. GENERAL PROVISIONS 1-8 Sec. 84.001. DEFINITIONS. In this chapter: 1-9 (1) "Advertisement" means a communication that: 1-10 (A) solicits the use of legal services provided 1-11 by an attorney; 1-12 (B) is directed to the general public; 1-13 (C) is paid for by, or on the behalf of, an 1-14 attorney; and 1-15 (D) is disseminated by: 1-16 (i) an electronic medium; 1-17 (ii) a print medium, including a newspaper 1-18 or billboard; or 1-19 (iii) a mailing directed generally to 1-20 members of the public and not to a specific person. 1-21 (2) "Attorney" means: 1-22 (A) a member of the State Bar of Texas; 1-23 (B) a person who is admitted to practice, in 1-24 good standing, and eligible to practice before: 2-1 (i) a federal court; or 2-2 (ii) the highest court of a state; or 2-3 (C) a person licensed to practice law in, or 2-4 admitted in good standing and eligible to practice before the bar 2-5 of the highest court of, a foreign country or a political 2-6 subdivision of a foreign country. 2-7 (3) "Electronic medium" means television, radio, or a 2-8 computer network. 2-9 (4) "Referral service" means a certified lawyer 2-10 referral service regulated under the Texas Lawyer Referral Service 2-11 Quality Assurance Act (Article 320d, Revised Statutes). 2-12 Sec. 84.002. APPLICABILITY. This chapter applies to: 2-13 (1) an attorney; and 2-14 (2) an agent of an attorney, law firm, or law 2-15 corporation doing business in this state. 2-16 (Sections 84.003-84.020 reserved for expansion) 2-17 SUBCHAPTER B. ADVERTISING 2-18 Sec. 84.021. LIMITATIONS ON ADVERTISEMENTS. (a) An 2-19 advertisement by an attorney may not contain a guarantee or 2-20 warranty regarding the results of a legal matter because of 2-21 representation by the attorney. 2-22 (b) An advertisement by an attorney may not contain a 2-23 statement or symbol stating that the attorney featured in the 2-24 advertisement can generally obtain immediate cash or quick 2-25 settlements. 2-26 (c) An advertisement by an attorney may not incorporate an 2-27 impersonation of the name, voice, photograph, or electronic image 3-1 of a person who directly or implicitly purports to be an attorney. 3-2 (d) An advertisement by an attorney may not incorporate an 3-3 impersonation of the name, voice, photograph, or electronic image 3-4 of a person who directly or implicitly purports to be a client of 3-5 the attorney featured in the advertisement, or a dramatization of 3-6 events, unless the advertisement discloses the impersonation or 3-7 dramatization. 3-8 (e) An advertisement by an attorney may not use a 3-9 spokesperson, including a celebrity spokesperson, unless the 3-10 advertisement discloses the title of the spokesperson. 3-11 (f) An advertisement by an attorney may not state that an 3-12 attorney offers representation on a contingent fee basis unless the 3-13 statement also advises whether a client will be held responsible 3-14 for any costs advanced by the attorney if a recovery is not 3-15 obtained on behalf of the client. If the client will not be held 3-16 responsible for those costs, the disclosure is not required. 3-17 Sec. 84.022. ADVERTISING THROUGH ELECTRONIC MEDIA. (a) To 3-18 comply with Section 84.021, in advertising by electronic media a 3-19 message as a whole: 3-20 (1) may not be false, misleading, or deceptive; and 3-21 (2) must be factually substantiated. 3-22 (b) In this section: 3-23 (1) "Factually substantiated" means capable of 3-24 verification by a credible source. 3-25 (2) "Message" means the effect in combination of the 3-26 spoken word, sound, background, action, symbols, visual image, or 3-27 any other technique employed to create the advertising message. 4-1 Sec. 84.023. PRESUMPTION. (a) A rebuttable presumption 4-2 exists that the following are false, misleading, or deceptive for 4-3 purposes of Section 84.022: 4-4 (1) a message as to the ultimate result of a specific 4-5 case or cases that is presented out of context without adequately 4-6 providing information as to the facts or law giving rise to the 4-7 result; 4-8 (2) the depiction of an event through methods such as 4-9 the use of displays of injuries, accident scenes, or portrayals of 4-10 other injurious events that may or may not be accompanied by sound 4-11 effects and that may give rise to a claim for compensation; and 4-12 (3) a message referring to or implying money is 4-13 received by or for a client in a particular case or cases or to 4-14 potential monetary recovery for a prospective client. 4-15 (b) For purposes of Subsection (a)(3), a reference to money 4-16 or a monetary recovery includes a specific dollar amount, 4-17 characterization of a sum of money, monetary symbols, or the 4-18 implication of wealth. 4-19 Sec. 84.024. INFORMATION AUTHORIZED FOR ADVERTISEMENTS. The 4-20 following information provided by an attorney is presumed to comply 4-21 with this chapter for purposes of advertising by electronic media 4-22 if the message as a whole is not false, misleading, or deceptive: 4-23 (1) the name of the attorney, including the name of 4-24 the law firm, names of professional associates, addresses, 4-25 telephone numbers, and the designation "lawyer," "attorney," or an 4-26 analogous designation; 4-27 (2) the attorney's fields of practice, including any 5-1 limitation of practice or specialization; 5-2 (3) fees charged by the attorney for routine legal 5-3 services; 5-4 (4) the attorney's date and place of birth; 5-5 (5) the date and place of admission of the attorney to 5-6 the bar of state and federal courts; 5-7 (6) the schools attended by the attorney, with dates 5-8 of graduation, degrees, and other scholastic distinctions; 5-9 (7) any public or quasi-public offices held by the 5-10 attorney; 5-11 (8) any military service by the attorney; 5-12 (9) legal writings authored by the attorney; 5-13 (10) legal teaching positions held by the person; 5-14 (11) memberships, offices, and committee assignments 5-15 held by the attorney in bar associations; 5-16 (12) memberships and offices held by the attorney in 5-17 legal fraternities and legal societies; 5-18 (13) technical and professional licenses held by the 5-19 attorney; 5-20 (14) memberships held by the attorney in scientific, 5-21 technical, and professional associations and societies; and 5-22 (15) any foreign language ability of the attorney or a 5-23 member of the attorney's law firm. 5-24 Sec. 84.025. ELECTRONIC MEDIA DISCLOSURE REQUIREMENTS. (a) 5-25 In addition to any disclosure required by the Texas Disciplinary 5-26 Rules of Professional Conduct, the disclosure required under 5-27 Subsection (b) must appear in advertising by electronic media. Use 6-1 of the disclosure alone does not rebut a presumption created under 6-2 Section 84.023. 6-3 (b) If an advertisement in the electronic media conveys a 6-4 message portraying a result in a particular case or cases, the 6-5 advertisement must state, in either an oral or printed 6-6 communication: 6-7 (1) the factual and legal circumstances that justify 6-8 the result portrayed in the message, including the basis for 6-9 liability and the nature of injury or damage sustained; or 6-10 (2) that the result portrayed in the advertisement was 6-11 dependent on the facts of that case and that the results will 6-12 differ if based on different facts. 6-13 Sec. 84.026. COPY. A verified copy of each advertisement 6-14 soliciting the use of legal services shall be retained for one year 6-15 by the person who pays for the advertisement. 6-16 (Sections 84.027-84.040 reserved for expansion) 6-17 SUBCHAPTER C. COMPLAINT PROCEDURES AND CIVIL ACTIONS 6-18 Sec. 84.041. STATE BAR COMPLAINT. (a) A person who alleges 6-19 a violation under Subchapter B by an attorney or a referral service 6-20 may file a complaint with the State Bar of Texas. 6-21 (b) A complaint filed under this section must: 6-22 (1) state the name of the advertiser; 6-23 (2) include a description of the advertisement alleged 6-24 to violate Subchapter B; and 6-25 (3) specifically identify the alleged violation. 6-26 (c) The complainant shall serve the advertiser with a copy 6-27 of the complaint on the date the complaint is filed with the state 7-1 bar. 7-2 Sec. 84.042. EFFECT OF VOLUNTARY WITHDRAWAL OF 7-3 ADVERTISEMENT. (a) On receipt of the complaint, the advertiser 7-4 may elect to voluntarily withdraw from broadcast the advertisement 7-5 that is the subject of the complaint. If the attorney or referral 7-6 service elects to withdraw the advertisement, the attorney or 7-7 referral service shall notify the state bar of that fact. 7-8 (b) If the advertisement is withdrawn not later than the 7-9 ninth day after the date on which the complaint is sent to the 7-10 attorney or referral service, the complainant and the state bar may 7-11 not take further action on the complaint. 7-12 Sec. 84.043. REVIEW OF ADVERTISEMENT BY STATE BAR; 7-13 DETERMINATION. (a) The advertiser shall provide a copy of the 7-14 advertisement in question to the state bar for review not later 7-15 than the seventh day after the date of service of the complaint. 7-16 (b) Not later than the 21st day after the date of delivery 7-17 of the advertisement, the state bar shall determine whether 7-18 substantial evidence of a violation exists under Subchapter B. The 7-19 review shall be conducted by an attorney employed by the state bar 7-20 who has expertise in the area of attorney advertising. 7-21 (c) If the state bar determines that substantial evidence of 7-22 a violation exists, the state bar shall notify the advertiser, who 7-23 shall withdraw the advertisement from broadcast. If the 7-24 advertisement is withdrawn within 72 hours after the receipt of the 7-25 notice by the advertiser, the complainant and the state bar may not 7-26 take further action on the complaint. 7-27 Sec. 84.044. CIVIL ACTIONS; LIMITATIONS PERIODS. (a) If an 8-1 advertiser fails to withdraw an advertisement as required by 8-2 Section 84.043, a complainant may bring an action under Section 8-3 84.047 not later than the first anniversary of the date of the 8-4 state bar determination under Section 84.043(b). 8-5 (b) If the advertiser withdraws an advertisement after a 8-6 state bar determination that substantial evidence of a violation 8-7 exists and subsequently rebroadcasts the same advertisement without 8-8 a finding by the trier of fact in an action brought under Section 8-9 84.045 or 84.047 that the advertisement does not violate Subchapter 8-10 B, a complainant may bring an action not later than the first 8-11 anniversary of the date of the rebroadcast. 8-12 (c) On a determination by the state bar that substantial 8-13 evidence of a violation does not exist, a complainant is barred 8-14 from bringing an action under Section 84.047, but may bring an 8-15 action for declaratory relief under Section 84.045. 8-16 Sec. 84.045. DECLARATORY RELIEF. (a) An advertiser that 8-17 was the subject of a complaint and any complainant affected by the 8-18 determination of the state bar under Section 84.043 may bring an 8-19 action for declaratory relief to obtain a judicial declaration of 8-20 whether Subchapter B has been violated and, if applicable, may also 8-21 request injunctive relief. 8-22 (b) Any defense otherwise available at law may be raised for 8-23 the first time in the declaratory relief action, including a 8-24 constitutional challenge. 8-25 (c) An action filed under Section 84.047 is stayed pending 8-26 the resolution of the declaratory relief action. 8-27 (d) The declaratory relief action shall be defended by the 9-1 real party in interest. The state bar may not be considered a 9-2 party to the action unless it elects to intervene in the action. 9-3 (e) If the court declares that the advertisement violates 9-4 Subchapter B, an action may be brought under Section 84.047 if the 9-5 advertiser: 9-6 (1) failed to withdraw the advertisement within 72 9-7 hours of the state bar determination under Section 84.043(b); or 9-8 (2) rebroadcasts the advertisement following the 9-9 decision in the declaratory relief action. 9-10 (f) If the court declares that the advertisement does not 9-11 violate Subchapter B, the advertiser may continue to broadcast the 9-12 advertisement. 9-13 (g) The decision of the court under this section is binding 9-14 on the issue of whether the advertisement is unlawful in any action 9-15 brought under Section 84.047 if that binding effect is consistent 9-16 with the doctrine of collateral estoppel or res judicata. 9-17 Sec. 84.046. OTHER ADVERTISERS. (a) A complaint may be 9-18 brought against an advertiser who is not a member of the state bar 9-19 or a referral service by filing a civil action for a violation of 9-20 Subchapter B. The action may be brought after 14 days' notice to 9-21 the advertiser of the alleged violation by the complainant. 9-22 (b) If the advertiser does not withdraw from broadcast the 9-23 advertisement that is the subject of the notice not later than the 9-24 14th day after the date of service of the notice under Subsection 9-25 (a), the complainant may bring an action under Section 84.047. 9-26 (c) The action must be brought not later than the first 9-27 anniversary of the date of the last publication or broadcast of the 10-1 advertisement that is the subject of the action. 10-2 Sec. 84.047. ENFORCEMENT ACTION; ATTORNEY'S FEES. (a) 10-3 Subject to Section 84.045, a person who violates Subchapter B is 10-4 liable to any resident of this state, with damages not to exceed 10-5 $5,000 for each individual broadcast in violation of Subchapter B. 10-6 (b) Venue under this section is in each county in which the 10-7 advertisement was broadcast. 10-8 (c) In an action under this section the matter shall be 10-9 determined according to the law and procedure relating to the trial 10-10 of civil actions, including trial by jury, if demanded. 10-11 (d) The determination of the state bar under Section 84.043 10-12 is admissible in an action brought under this section. 10-13 (e) The court shall report the name, address, and 10-14 professional license number of any person found in violation of 10-15 this chapter to the appropriate professional licensing agency for 10-16 review and possible disciplinary action. 10-17 (f) The court may award attorney's fees to the prevailing 10-18 party in an action under this section if the court finds that the 10-19 action has resulted in the enforcement of an important public 10-20 interest or that a significant benefit has been conferred on the 10-21 public. 10-22 Sec. 84.048. STATE BAR NOT PARTY. The state bar may not be 10-23 a party or a witness in either a declaratory relief proceeding 10-24 brought under Section 84.045 or a civil action brought under 10-25 Section 84.047. Additionally, no direct action may be filed 10-26 against the state bar challenging the state bar's decision under 10-27 Section 84.043. 11-1 Sec. 84.049. RECORDS; BOND REQUIREMENTS FOR CERTAIN 11-2 LITIGANTS. (a) The state bar shall maintain a record of each 11-3 complaint filed under Section 84.041 for seven years after the date 11-4 the complaint is filed. 11-5 (b) If the state bar determines that an individual 11-6 complainant has filed five or more unfounded complaints within a 11-7 seven-year period, the state bar shall classify that complainant as 11-8 a vexatious litigant for purposes of this section. The state bar 11-9 shall require any person classified as a vexatious litigant to post 11-10 security set by the state bar at an amount that is reasonable to 11-11 cover the costs of considering the complaint. The state bar may 11-12 not consider the complaint filed by that person until the security 11-13 is posted. 11-14 (c) In an action under this chapter that is brought by a 11-15 person classified as a vexatious litigant, the defendant may advise 11-16 the court and trier of fact that the plaintiff is classified as a 11-17 vexatious litigant under this section and may disclose the basis 11-18 for the classification. 11-19 (d) Nothing in this chapter restricts any other right 11-20 available under existing law or otherwise available to a person 11-21 seeking redress for false, misleading, or deceptive advertisements. 11-22 Sec. 84.050. DISCIPLINARY ACTION. A violation of Subchapter 11-23 B by a member of the state bar is grounds for disciplinary action 11-24 by the state bar. In addition to the grounds for the initiation of 11-25 a disciplinary proceeding under a statute or the Texas Disciplinary 11-26 Rules of Professional Conduct, the state bar may begin an 11-27 investigation based on a complaint filed by a person under Section 12-1 84.041. The determination of the state bar under Section 84.043 is 12-2 admissible, but not determinative, in any disciplinary proceeding 12-3 brought as a result of that complaint. 12-4 Sec. 84.051. EFFECT ON OTHER LAW; SEVERABILITY. (a) 12-5 Nothing in this chapter limits or precludes enforcement of: 12-6 (1) another statute; 12-7 (2) a court rule; or 12-8 (3) the Texas Disciplinary Rules of Professional 12-9 Conduct. 12-10 (b) Nothing in this chapter limits the right of advertising 12-11 protected under the constitution of this state or of the United 12-12 States. If any provision of this chapter is found to violate 12-13 either constitution, that provision is severable and the remaining 12-14 provisions are enforceable without the severed provision. 12-15 SECTION 2. This Act takes effect September 1, 1995, and 12-16 applies only to attorney advertising disseminated on or after 12-17 January 1, 1996. 12-18 SECTION 3. The importance of this legislation and the 12-19 crowded condition of the calendars in both houses create an 12-20 emergency and an imperative public necessity that the 12-21 constitutional rule requiring bills to be read on three several 12-22 days in each house be suspended, and this rule is hereby suspended.