MARYLAND STATE BAR ASSOCIATION, INC.
COMMITTEE ON ETHICS
ETHICS DOCKET NO. 2009-02
Direct Contact with Prospective Clients where the Prospective Client is an Organization
You ask the Committee to answer five questions 1 all raising issues of interpretation of Rule 7.3 of the Maryland Rules of Professional Conduct for Lawyers (“Rules”) as to whether various forms of contact with union officials are prohibited by that rule. The gist of the issues involves the question of whether an attorney may contact union2 officials in an effort to obtain the union’s legal business. The short answer to your questions confirms that Rule 7.3 applies when you engage in direct contact with the representatives of a prospective client organization, does not apply when you are contacting representatives of current clients, and that email is not a “real time” communication.
Rule 7.3 provides:
Direct Contact with Prospective Clients
(a) A lawyer shall not by in-person, live telephone or real-time electronic contact solicit professional employment from a prospective client when a significant motive for the lawyer’s doing so is the lawyer’s pecuniary gain, unless the person contacted:
(1) is a lawyer; or
(2) has a family, close personal, or prior professional relationship with the lawyer.
(b) A lawyer shall not solicit professional employment from a prospective client by written, recorded or electronic communication or by in-person, telephone, or real-time electronic contract even when not otherwise prohibited by paragraph (a), if:
(1) the lawyer knows or reasonably should know that the physical, emotional or mental state of the prospective client is such that the prospective client could not exercise reasonable judgment in employing a lawyer;
(2) the prospective client has made known to the lawyer a desire not to be solicited by the lawyer; or
(3) the solicitation involves coercion, duress, or harassment.
(c) Every written, recorded, or electronic communication from a lawyer soliciting professional employment from a prospective client known to be in need of legal services in a particular matter shall include the words “Advertising Material” on the outside envelope, if any, and at the beginning and ending of any recorded or electronic communication, unless the recipient of the communication is a person specified in paragraphs (a)(1) or (a)(2).
(d) Notwithstanding the prohibitions in paragraph (a), a lawyer may participate with a prepaid or group legal service plan operated by an organization not owned or directed by the lawyer that uses in-person or telephone contact to solicit memberships or subscriptions for the plan from persons who are not known to need legal services in a particular matter covered by the plan.
The facts you describe giving rise to your questions describe your work in the field of labor and employment law. Specifically, you indicate that you represent labor unions and on occasion are appointed by the union to represent a member of the union. You say that in the course of your practice you may on occasion uncover information that indicates that employees, who are members of a union, could be entitled to overtime that has not been paid them. You want to know if Rule 7.3 permits you to contact the unions who represent these employees to alert them to the potential claim and your ability to further that claim on the union’s and employees’ behalf.
Insofar as, the information you discover involves employees of a union you currently represent, you are not prohibited from letting the union know that information; indeed, you may be required to alert your client to those facts.3 Rule 7.3 addresses “prospective” clients, not current clients and we believe it does so through thoughtful consideration. Rule 7.3 and its comments make clear that the purpose of the Rule is to prevent a layperson from falling prey to undue influence, intimidation and over-reaching. Rule 7.3, Comment 1.
When the information you discover applies to employees in different bargaining units (unions) from those you represent, Rule 7.3 applies and guides how you may communicate with the prospective client. As the union cannot act except through its officers and directors, Rule 7.3 must be construed to apply to communications with officers and directors of the union as if each were a prospective client. Thus, real time in-person solicitations of these people are prohibited unless, except as limited by Rule 7.3(b), they are lawyers, past clients or people with whom you have previously had a close relationship either personal, familial or business.
As Rule 7.3(b) applies, you cannot engage in direct solicitation of professional employment in-person or otherwise when: 1) you know or reasonably should know that the physical, emotional or mental state of the prospective client is such that the prospective client could not exercise reasonable judgment in employing a lawyer; (2) the prospective client has let you know that your solicitations are unwelcome; or (3) your solicitation involves coercion, duress, or harassment. Similarly, Rule 7.3(c) applies, so you must include in the solicitations the required notifications mandated by that rule.
You indicate that in some instances a union will appoint you to represent a member of the bargaining unit (union) in matters affecting the member’s employment. Under those circumstances, similar to counsel for an insured under a contract of insurance where the insurer appoints counsel, your relationship with the union and the employee may give rise to a dual responsibility that for purposes of Rule 7.3 requires you to consider both your client in terms of your responsibility to disclose to them information you have learned that may affect them. They would be current clients, rather than prospective clients for purposes of Rule 7.3. Similarly, one or the other or both would be past clients in situations where your representation has previously terminated.
In construing Rule 7.3, we agree with you that an email is not “a real time” communication. In the context of the Open Meetings Law, the Attorney General has differentiated between emails and instant messaging determining that the latter triggers the requirements of the Open Meetings Law, while the former does not. 4 The Committee recognizes that this issue is not free from doubt. No other states have addressed a version of Rule 7.3 that reads as Maryland’s. Yet, in Utah, its State Bar Ethics Advisory Opinion Committee concluded that direct email contact with a prospective client was tantamount to communication by regular mail. Nevertheless, that Committee recognized as does this Committee that an email may have a different effect on a recipient than regular mail that requires a lawyer to have a heightened awareness in complying with Rule 7.3(b).
The applicability of the Rules of Professional Conduct to e-mail is more difficult to analyze. Because (a) e-mail is in writing (similar to a facsimile transmission), (b) it does not represent a “live” communication (unlike the chat-room discussions), and (c) the recipient can ignore the message or respond at leisure and after due reflection, we find that e-mail is not an “in person” communication under Rule 7.3(a).
However, because e-mail is different from a written advertisement that is delivered through the U.S. Postal Service or other similar services, it may have a different impact due to the speed and mode of transmission and the difficulty of regulation. In addition to the rules discussed above, the lawyer should be aware that the instantaneous nature of e-mail could raise issues regarding Rules 7.3(b)(1) and (b)(3),which prohibit direct solicitation to those who are in such a state that they cannot exercise reasonable judgment in employing a lawyer and solicitations which involve coercion, duress, or harassment.5 [Footnotes omitted.]
As noted, version of Rule 7.3 that was applicable in Utah at the time differs markedly from its Maryland counterpart. 6 Nevertheless, the similarities drawn by the Utah Committee between mail and email back up this Committee’s analysis.
While in Illinois, the Illinois State Bar Association under another markedly different version of Rule 7.3 concluded that direct email contact with a prospective client triggered the requirements of the Rule, but was not called upon by the text of its Rule 7 to distinguish between email and any other form of communication.
On the other hand, lawyer participation in an electronic bulletin board, chat group, or similar service, may implicate Rule 7.3, which governs solicitation, the direct contact with prospective clients. The Committee does not believe that merely posting general comments on a bulletin board or chat group should be considered solicitation. However, of a lawyer seeks to initiate an unrequested contact with a specific person or group as a result of participation in a bulletin board or chat group, then the lawyer would be subject to the requirements of Rule 7.3. For example, if the lawyer sends unrequested electronic messages (including messages in response to inquiries posted in chat groups) to a targeted person or group, the messages should be plainly identified as advertising material.8
The Committee believes that where the framers of Rule 7.3 differentiate in subsection “b” between “real time electronic communications” and “electronic communications” that the intent was to exclude emails from “real time” communications.
The Committee does not agree with you that Comment 6 under Rule 7.3 exempts your communications under the scenario you present. Comment 6 discusses communications about a lawyer’s services with prepaid legal plans or groups designed to provide legal services to the members. You have described facts that indicate that you seek to represent a union and that all decisions about your employment will be made by the union as an organization. In the context of a prepaid legal services plan, the entity negotiates the basics of the lawyer’s fees as part of selecting the lawyer as a participant in the plan who the members may then select as their attorney. The relationship is different. In addition, the facts are different. An entity offering a prepaid legal services plan presumably seeks solicitations from attorneys who are willing to participate in the plan. A union is formed for other purposes, some of which may include providing members legal representation, but the formation of a union can hardly be considered a request for offers of legal representation or for terms of regarding the legal representation of its members.
While not made part of your question, the Committee confirms that direct solicitations of professional employment must also conform to the other Rules applicable to “Information about Legal Services.” Rules 7.1, 7.2, 7.4 and 7.5.
The Committee hopes it has addressed your inquiry and thanks you for your interest. Our opinions are available on line at www.msba.org.
“1. Would an email message sent to a Union official notifying them that the Union (and thereby the Bargaining Unit and bargaining unit employees) has a potential FLSA Overtime Grievance violate Rule 7.3(a)?
“2. Would a phone call sent to a Union official notifying them that the Union (and thereby the Bargaining Unit and bargaining unit employees) has a potential FLSA Overtime Grievance violate Rule 7.3(a)?
“3. Would an email message sent to a Union official notifying them that the Union (and thereby the Bargaining Unit and bargaining unit employees) has a potential FLSA Overtime Grievance violate Rule 7.3(b)?
“4. Would a phone call sent to a Union official notifying them that the Union (and thereby the Bargaining Unit and bargaining unit employees) has a potential FLSA Overtime Grievance violate Rule 7.3(b)?
“5. Would an email or other mailing sent to a Union official notifying them that the Union (and thereby the Bargaining Unit and bargaining unit employees) has a potential FLSA Overtime Grievance trigger the notification requirement found in 7.3(c)?”
The terms “union” and “bargaining unit” are used interchangeably throughout this opinion. The Committee recognizes that there may be separate bargaining units of the same union. Rule 1.13 addresses representation of organizations and makes clear that identification of the client can be difficult. The Committee recognizes that the facts regarding your representation will govern whether you represent an individual bargaining unit of a union having multiple bargaining units, or the union as a whole. Under Rule 1.13 the determination of the identity of your client will be based on those facts.
The issue of whether you would be required to inform your client of information beyond the scope of your representation raises a question beyond the Rules of Professional Conduct and involves the legal question of a lawyer’s fiduciary duty to a client. The Maryland Court of Appeals discussed the lawyer client relationship in Frederick Road Ltd. Partnership v. Brown & Sturm 360 Md. 76, 102-103, 756 A.2d 963, 977 – 978 (Md.,2000) and seemingly limited the duty to information that involves matters within the subject of the representation:
“Id. at 518-519, 307 A.2d at 682. Thus, it is clear that the attorney-client relationship requires the attorney to act with the utmost good faith and loyalty, which includes making known to the client all information that is significant and material to the matter that is the subject of the relationship. Notwithstanding the provisions of the Maryland Rules of Professional Conduct on the subject, and, indeed, supplementary thereto, the requirement of good faith and loyalty is deeply rooted in common law and equity principles, see, 2 Ronald E. Mallen & Jeffery M. Smith Legal Malpractice, § 14.1 (4 th ed.1996); see also Sargent v. Buckley, 697 A.2d 1272, 1275 (Me.1997); Santa Clara County Counsel Attys. Assoc. v. Woodside, 7 Cal.4th 525, 28 Cal.Rptr.2d 617, 869 P.2d 1142, 1154 (1994), and, therefore, must be upheld as a principle that is rightfully relied upon by the public and integral to the proper function of our judicial system. It follows that a client has the right to rely on his or her lawyers’ loyalty and to believe the accuracy and candor of the advice they give.” (Footnotes omitted.)
Frederick Road Ltd. Partnership v. Brown & Sturm 360 Md. 76, 102-103, 756 A.2d 963, 977 – 978 (Md.,2000)
See: Open Meetings Act Manual, Sixth Edition, Oct. 2006 wherein the Manual notes:
“Likewise, the Act does not apply to conventional e-mail messages.”21
21 81 Opinions of the Attorney General 140 (1996); 2 OMCB Opinions 78 (1999)(Opinion 99-15). The Virginia Supreme Court reached the same conclusion about a comparable provision in Virginia’s “sunshine” law. Beck v. Shelton, 953 S.E.2d 195 (Va.2004). The result might be different if a quorum were participating in a simultaneous medium like a pre-arranged “chat room.”
Open Meetings Act Manual, 6th Ed. October 2006, page 8.
UT Eth. Op. 97-10, October 24, 1997.
“Rule 7.3 Direct Contact with Prospective Clients.
“(a) A lawyer may not solicit, in-person, professional employment from a prospective client with whom the lawyer has no family or prior professional relationship, when a significant motive for the lawyer’s doing so is the lawyer’s pecuniary gain. The term “in-person” includes in-person and telephonic communication directed to a specific recipient, but does not include letters addressed or advertising circulars distributed generally to persons not known to need legal services of the kind provided by the lawyer in a particular matter, but who are so situated that they might in general find such services useful.
“(b) A lawyer may not solicit, by mail or other written communication directed to a specific recipient concerning a specific cause of action, professional employment from a prospective client with whom the lawyer has no family or prior professional relationship under the following circumstances:
“(1) The lawyer knows or reasonably should know that the physical, emotional or mental state of the person is such that the person could not exercise reasonable judgment in employing a lawyer;
“(2) The person has made known to the lawyer a desire not to receive communications from the lawyer; or
“(3) The communication involves coercion, duress, or harassment.”
UT Eth. Op. 97-10, 1997 WL 705482 (Utah St.Bar.)
‘Rule 7.3. Direct Contact With Prospective Clients
‘Except as provided in this Rule 7.3, or as permitted by Rule 7.2, a lawyer shall not, directly or through a representative, solicit professional employment when a significant motive for doing so is the lawyer’s pecuniary gain. The term “solicit” means contact with a person other than a lawyer in person, by telephone or telegraph, by letter or other writing, or by other communication directed to a specific recipient.
‘(a) Except as provided in Rule 7.3(b), a lawyer may initiate contact with a prospective client for the purpose of solicitation in the following circumstances:
‘(1) if the prospective client is a relative, or a close friend of the lawyer, or a person with whom the lawyer or the lawyer’s firm has had a prior professional relationship;
‘(2) by letters or advertising circulars, providing that such letters and circulars and the envelopes containing them are plainly labeled as advertising material; or
‘(3) under the auspices of a public or charitable legal services organization or a bona fide political, social, civic, charitable, religious, fraternal, employee or trade organization whose purposes include but are not limited to providing or recommending legal services.
‘(b) In no event may a lawyer solicit a prospective client if:
‘(1) the lawyer reasonably should know that the physical or mental state of the person is such that the person could not exercise reasonable judgment in employing a lawyer;
‘(2) the lawyer knows that the person solicited does not desire to receive a communication from the lawyer; or
“(3) the solicitation involves coercion, duress, or harassment.”
ILCS S Ct Rules of Prof.Conduct, RPC Rule 7.3
IL Adv. Op. 96-10, May 16, 1997. California also discussed email solicitations of prospective clients, but it has not adopted the ABA Model Rules and its rule differs so completely from Maryland’s that little can be gained by analyzing its opinion in the context of Maryland’s Rule and the issues raised by your questions. See: CA Eth. Op. 2004-166, 2004.
REFERENCES:
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- Maryland Rules of Professional Conduct for Lawyers Rule 7.3
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- Frederick Road Ltd. Partnership v. Brown & Sturm 360 Md. 76, 102-103, 756 A.2d 963, 977 – 978 (Md.,2000)
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- Open Meetings Act Manual, 6th Ed. October 2006.
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- IL Adv. Op. 96-10, May 16, 1997.
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- UT Eth. Op. 97-10, October 24, 1997.
ASSIGNED TO: Charles W. Thompson, Jr., Esquire
DATE ASSIGNED: July 21, 2008
DATE DISTRIBUTED: August 2, 2008; August 3, 2008
DATE FINAL: August 28, 2008