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Posts Tagged ‘HB 2221’

petition | by League of Women Voters of CaliforniaA petition was filed today asking the Arizona Supreme Court to amend Rule 32(c) and (d) so as to split the functions of the State Bar of Arizona into two distinct subsets, a mandatory membership organization (“Mandatory Bar”) and a purely voluntary membership organization (“Voluntary Bar”). The amendment to the Court Rules would maintain the current mandatory membership requirement for all lawyers but (1) eliminate mandatory membership dues for non-regulatory functions and (2) allow voluntary contributions for all non-regulatory functions. Read the petition here.

The petition was filed by Sherman & Howard attorney Gregory Falls on behalf of the Goldwater Institute. By way of explanation on its website, the Goldwater Institute reiterates its opposition to “conditioning the practice of law on bar membership in Arizona because coerced membership violates the rights to free speech and free association guaranteed by the United States and Arizona Constitutions.”

It is for this reason, the Institute says it is “sponsoring a rule change petition to allow attorneys to practice law without being forced to fund the lobbying and other non-regulatory functions of the State Bar of Arizona.”

Change Management | by Jurgen AppeloThe petition is reminiscent of HB2221, which the petition acknowledges, “called for a less nuanced version of what Petitioner proposes here.” HB2221 came within 5 votes of clearing the Arizona Legislature and landing on the governor’s desk during the 2016 legislative session. Like today’s petition, HB2221 was modeled on the Nebraska Supreme Court’s bifurcated approach to bar membership articulated in its December 6, 2013 decision Petition For Rule To Create Vol. State Bar Assn. 286 Neb. 108.

j0289753The Nebraska Supreme Court ordered that the requirement be left in place mandating membership in the Nebraska State Bar Association. But the Court also lifted the requirement that attorneys fund the Nebraska Bar’s non-regulatory functions. This meant Nebraska attorneys still paid regulatory and disciplinary costs but were no longer forced to subsidize the Nebraska Bar’s speech and its non-regulatory activities.

In its website statement, the Goldwater Institute acknowledges that “the Nebraska Model falls short of the fully voluntary model used in 18 other states.” It adds, however, that Nebraska’s bifurcated model “is a significant positive step toward associational freedom.”

Another front.

The petition filing opens up another front in the long-term campaign to reform lawyer regulation in Arizona. Along with continuing legislative efforts, the goal is to remediate a system not only rife with inequity but which represents a continuing threat to consumers. In addition to impinging constitutional rights on lawyers by preconditioning membership in a trade association to earn a living in their chosen profession, mandatory bar associations have an inherent conflict of interest because they act as both regulators of and trade associations for lawyers. And that conflict of interest is further exacerbated when lawyers elect a controlling number of other lawyers to represent them in their own regulatory board. By its very nature, then, this cartel-protection system threatens capture of the regulatory board by lawyers at the expense of the public.

Jen, kissing the First Amendment goodbye? | by jasoneppinkConditioning the practice of law on bar membership also violates lawyers’ constitutional rights. The U.S. Supreme Court has found that the only compelling state interest in coercive bar association membership is to improve the practice of law through lawyer regulation. But the fact is that lawyer regulation and improved legal practice can be attained through less restrictive means. 18 states — Arkansas, Colorado, Connecticut, Delaware, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Ohio, Pennsylvania, Tennessee, and Vermont — have already found ways to regulate attorneys without compelling membership

Arizona lawyers aren’t the only professionals concerned with a mandatory bar’s opacity, bureaucratic wastefulness, and divided loyalties to the public and lawyers. Indeed, attorney and public members of the California State Bar’s Board of Trustees are working again with California Legislators to bifurcate that Bar’s regulatory and trade association functions. See Calif. State Bar Blasted for Lack of Transparency  and Lawmakers Fight to Reform California Bar After Audits Skewer Agency for Mismanagement, Lack of Transparency, and Pricey Salaries.

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Credits: Petition, by League of Women Voters of California LWVC at Flickr Creative Commons Attribution license; Change Management by Jurgen Appelo at Flickr Creative Commons Attribution License; Jen, kissing the first amendment goodbye, by Jason Eppink at Flickr Creative Commons Attribution.

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Rod Serling - Twilight Zone Button | by TobyotterMay 11th is Twilight Zone Day, an unofficial holiday that celebrates The Twilight Zone, that iconic 1960’s era television anthology replete with unexpected twists, surprise endings and of course, the bizarre. What an appropriate day then to comment on a blast email from the president of the State Bar of Arizona.

It was an “update” received a few days ago following the defeat of HB 2221. This was the bill that having passed the Arizona House and legislative committees in both houses, came within 5 votes in the Arizona Senate of getting to the governor’s desk. The legislation failed to pass the Senate on May 5, 2016. Bar reformers vow to continue the fight next legislative session.

As for the bar president’s email, too bad it again mischaracterized HB 2221 as “the bill that would have created a two-tiered membership within the State Bar of Arizona.” Two-tiers? To practice law in Arizona, there’s only one tier. It’s called mandatory membership in the Arizona Bar, which would have singularly remained the requisite precondition to practice law in the state.

In truth, HB 2221 would have helped protect the constitutional rights of Arizona lawyers. And it would have increased transparency by subjecting the Bar to Arizona Public Records Lawlike all other state regulatory bodies.

The principal reason the State Bar opposed the bill was because HB 2221 would have forbidden it from using mandatory dues for anything other than lawyer regulation. Bar leadership didn’t want to lose access and control over both regulatory and non-regulatory mandatory assessments paid by Arizona’s lawyers.

laughing seinfeld evil newman laughThe other reason the Bar disliked the bill was because as the bar president’s email intimated, it didn’t see the need for greater public transparency. The Bar has long been a tone-deaf master of self-congratulation and self-delusion. Hardly a surprise then that the bar president declared, “our organization has worked to be exceptionally transparent.” This from the same organization that fails to provide detailed budget expense information to its members and that attempted to pass a stealth dues increase 12 days before Christmas 2013. It’s also the same organization that tried to disband member sections and impose a CLE precertification revenue enhancer both while it thought no one was paying attention. More recently, it’s also the organization that uses mandatory assessments to lobby against the interests of its members. And good luck getting a number on the extent and total dollar expenditure both internally in executive compensation and externally in outside lobbyist fees.

But as risibly self-delusional as that “exceptionally transparent” declaration was, the email also offered a sop to lawyers believing otherwise, i.e., that the Bar is not only non-transparent but secretive. The bar president pointed out that “a proposed Supreme Court rule would subject the Bar to open records and open meeting requirements.”

That ‘solution,’ however, leaves a lot unanswered. It may also prove less than satisfactory. Rather than submit to Arizona A.R.S. § 39-121, the Bar prefers to fall under Arizona Supreme Court Rule 123(a), which provides: “Pursuant to the administrative powers vested in the Supreme Court by Article VI, Section 3, of the Arizona Constitution, and the court’s inherent power to administer and supervise court operations, this rule [is] adopted to govern public access to the records of all courts and administrative offices of the judicial department of the State of Arizona.”

Well and good except that even though the Court falls under the statutorily defined plain meaning of “public body,” it has previously ruled for itself that “Rule 123 — not the Arizona Public Records Law — controls requests for judicial records.” See London v. Broderick and Arpaio v. Davis.

Furthermore, the bigger problem for the Arizona Bar is that contrary to its contention that HB 2221 would have created a “hybrid” State Bar, the fact is that the State Bar of Arizona is already a hybrid organization. It serves as attorney regulator and attorney “trade association.”

So as both regulator and trade association, does the Bar actually belong under Rule 123? Moreover, how will that work in actual practice? Clearly when the Bar uses lawyer mandatory assessments to perform regulatory functions such as lawyer discipline or lawyer admissions, it acts as a part of the Arizona Supreme Court. But what about when the Bar spends mandatory assessments on non-regulatory discretionary programs and services? When is the Bar required to be transparent? All the time? Or only when members police it? Or only when the Court deems it? Or only when it acts as a regulator?

And what about the real nub of the objection? How about when the State Bar uses mandatory assessments for everything else under the Arizona sun having nothing to do with regulating the legal profession to improve the quality of legal services to the public?

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Credits: “Rod Serling – Twilight Zone button,” by Tony Alter at Flickr Creative Commons Attribution.

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Right now, the State Bar of Arizona can spend attorneys’ mandatory dues on anything it wants to so long as the expenditure is related to improving the practice of law through the regulation of attorneys.  By its own interpretation, that could mean lobbying, conventions, financial contributions to special interest bar associations, office buildings, and who knows what else.  The Bar reads this permission so broadly, you can drive a dump truck through it.

Meantime, down at the Arizona Legislature, after almost 4 weeks, final votes are still pending on about 200 bills, including two measures concerning the State Bar of Arizona. All bills, though, are on hold, including the state bar bills. This is because at the beginning of April, Arizona’s governor set a legislative priority on the state budget. Governor Doug Ducey imposed a bill-signing moratorium to stop any more bills from hitting his desk until a state spending plan was finalized. The end of the month has come but budget negotiations continue.

The key state bar legislation this session is HB 2221. If it passes, the State Bar of Arizona would only be able to force lawyers to pay for attorney regulation and nothing more. Drawing this clear line is crucial to protecting attorneys’ free speech rights. But since the Arizona Bar much prefers the free-spending non-transparent status quo, it has done everything in its power to stop the historic legislation.

To underscore how important the line of demarcation is between free speech and the use of compulsory dues, look no further than the case of North Dakota attorney Arnold Fleck. With his experiences with the North Dakota Bar, Mr. Fleck has learned firsthand how easily mandatory bars can tread on attorney First Amendment rights.  In 2014, he discovered that the North Dakota Bar used nearly $50,000.00 in mandatory bar dues to oppose a shared parenting measure he supported.

Even after he filed a federal lawsuit and the North Dakota Bar consequently revised its policies, he discovered the North Dakota Bar was going to fund a “family law task force” that would propose legislative changes related to shared parenting.  He objected to the use of his dues to fund the task force and his objection went to mediation.  Mediator Karen Klein agreed that his dues could not be used to propose legislation but found his objection was premature because the task force had not yet spent money to that end. “The parameters of the activities the task force will perform are unclear,” she noted in her decision. As a result, Mr. Fleck must stay vigilant just so his dues are not used to fund causes he plainly opposes.

While stating that Mr. Fleck’s focus only on “improving the practice of law through regulation of the profession” was “too narrow,” it’s noteworthy the mediator also said, “I cannot find that all potential activities of the task force are germane under Keller.” Read the entire mediation ruling here.

As the mediator explained the holding in Keller v. State Bar of California, “The U.S. Supreme Court held that when a member of California’s integrated bar objects to his or her dues being used for particular expenditure, the bar may not charge that member dues for those expenditures unless “the challenged expenditures are necessarily or reasonably incurred  for the purpose of regulating the legal profession or improving the quality of the legal services available to the State.”

In sum, attorneys should not be have to constantly police their bar to make sure their free speech rights are not being violated. In Arizona, HB 2221 would solve that problem by forbidding the Bar from using mandatory dues for anything other than regulation. Arizona attorneys should not have to worry about what the Bar is doing with their money. And neither should North Dakota’s Arnold Fleck.

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Such a Clown! | by *~Dawn~*

Talk about questionable timing. Within days of the coming vote by Arizona’s Senate on a Bill that protects attorney free speech by requiring mandatory State Bar of Arizona dues be used only for attorney regulation, comes a blast email from that Bar’s President soliciting participation in an online attorney compensation survey. “Our hope,” says the email, “is to learn more about the current economic climate so we can better understand and report on trends in the profession, and in turn, serve you better.”

Serve you better? Multiple unwarranted fee hikes later, one of the most imperious and expensive state bars in the country now asks? It’s a bit late to open that stable door after the horse has been sold for glue.

https://upload.wikimedia.org/wikipedia/commons/thumb/1/1c/1811_PoorAuthor_RichBookseller_byWashingtonAllston_MFABoston.jpeg/433px-1811_PoorAuthor_RichBookseller_byWashingtonAllston_MFABoston.jpegBut then that’s the Arizona Bar’s age-old leadership problem. It’s tone-deaf, insular, and bureaucratically backward. And at the risk of piling on, did I also say bloated, inefficient and nontransparent?

The State Bar of Arizona’s real predicament is that while purporting to serve its members — it also tells the public it polices them. Such too, is the member confusion when their regulator claims to want to better serve them. The Arizona Bar simply can’t reconcile the irreconcilable: the inherent conflict of interest of supposedly protecting and serving the public by regulating Arizona’s lawyers while — at the same time — serving as a trade association promoting the common interests of those lawyers.

Meantime, the Bar’s pending legislation worries have everything to do with self-interest. The loss of control over 100% of the mandatory fees paid by Arizona’s lawyers means an unwelcome paradigm shift.

HB 2221 would authorize the Bar to only collect voluntary membership dues for non-regulatory operations. This means that instead of relying on coercion for its funding, a voluntary Arizona Bar would have to attract members who are willing to pay for its services. To its dismay, the Bar would be forced to be competitive. It might need to truly trim overhead and lower its costs.

photoAs for its survey, it appears the Bar anticipates sparse participation. Otherwise, why deign to offer dubious incentives to take its online survey? Participants will be entered into a drawing for a chance to be one of three ‘winners’ of free registration to the Arizona Bar’s Annual “Butt-Numb-A-Thon” Convention“a value of $455 each.” Two additional winners will be selected to receive a $100 Visa gift card.

Besides fees paid to the vendor, the prize incentives mean the survey has an additional cost to members of $1565. The easiest money to spend is always somebody else’s.

It’s also unclear from the Bar’s email if this questionnaire replaces the triennial “Economics of Law Practice in Arizona” survey, which was last done in 2013. Three years ago, the median reported salary for an Arizona sole practitioner with an outside office was $100,000 while the home office solo median was $75,000. (By comparison, if you rely on the puny survey sampling in the Nevada Bar’s Young Lawyer Section Compensation Survey released this month, the median base salary of Nevada young lawyers was $90,000-100,000. The Nevada Young Lawyer survey was based on “160 voluntary respondents” or roughly 2% of the state’s total lawyer population).

In the past,the Arizona Bar has charged members $125 for its complete economics of law practice report. See It’s unknown if the complete results of this current survey will also be sold. For more about legal profession economics, see “How about a raise?”

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Photo Credits: “Such a Clown” by Dawn Ellner at Flickr Creative Commons Attribution License; “The Poor Author and the Rich Bookseller” by Washington Allston, Wikimedia Commons, public domain;“Riveting meeting,” by Mark Hillary at Flickr via Creative Commons-license requiring attribution.

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Business 1381How fitting that following an almost hour debate, the very last bill that passed out of the Arizona House at 5 o’clock last Thursday was historic legislation to protect the free speech rights of Arizona attorneys. HB 2221 passed 31-29. Among other provisions, the bill requires that mandatory dues collected by the State Bar of Arizona be used only for regulatory functions and not for nonregulatory activities like it does now. The bill now moves to the Senate.

Attorneys in Arizona must currently belong to a trade association and pay mandatory membership dues as preconditions to earning a living in their chosen profession. Arizona attorneys are the only Arizona professionals bound by such an expedient. What makes this problematic is that the State Bar uses compulsory member dues to not only regulate the practice of law — but to engage in other activities such as lobbying and advocating for ideological and political causes that not all members agree with.

Artists 93The Bar says it “focuses on protecting the public by enhancing the profession, not politics.” In reality, the Bar has an odd way of showing it’s apolitical. Pay no attention, for example, to Bar executives and its lobbyist fighting legislation to eliminate the Bar’s inherent conflict of interest manifest in the claim to protect the public from lawyers while contemporaneously serving lawyer interests.

Last year despite the Bar’s steadfast ongoing opposition to voluntary bar legislation, Bar CEO John Phelps told the ABA’s Bar Leader Magazine, “If we can’t answer the questions about why a mandatory bar is a better model for folks in Arizona, then we ought not to be a required bar.”

The Bar’s resistance has everything to do with preserving a model that protects its bureaucratic self-regard. The loss of most of its mandatory dues monies would mean a sea change for its blithesome bureaucrats.

State Bar’s Free Speech.

Politicians 81Besides reaffirming state supreme court authority over lawyer regulation under the Arizona Constitution, HB 2221 also respects the State Bar’s free speech rights. It does not restrict the Bar’s ability to lobby or take political or ideological positions so long as those activities are voluntarily funded by attorneys. This provision is key because the bar is again distorting facts to serve naked self-interest.

Under Keller v. State Bar of California, 496 U.S. 1 (1990), the State Bar cannot compel attorneys to fund the Bar’s lobbying activities unrelated to regulating the practice of law. But nothing in Keller prevents the State Bar from collecting voluntary funds from attorneys to engage in any political activity that it wants. Just because the State Bar presently has a policy that it will not engage in political activities beyond those authorized in Keller, there is nothing to stop the Bar from changing that policy tomorrow. As a result, HB 2221 has no bearing on whether or not the State Bar will expand the array of political activities it chooses to engage in with voluntary funds.

Chutzpah redefined.

Game Show Hosts 9And in what can best be characterized as redefining that classic definition of Chutzpah, the Bar has begun audaciously arguing that a vote against HB 2221 would protect attorneys’ First Amendment rights! Why? Because Bar members are supposedly currently protected by U.S. Supreme Court precedent limiting the political speech of mandatory bar associations. The precedential case is Keller v. State Bar of California that held that mandatory membership bar associations can use members’ dues only for regulating the legal profession or improving the quality of legal services — not for political or ideological activities.

FunHouse 119Turning the argument on its head, the State Bar is saying with a straight face that it’s now protecting free speech by lobbying against legislation that protects free speech. It’s a brazen rephrasing: “I was against free speech before I was for free speech.”

Heavens Angels 87Were it truly interested in safeguarding the free speech rights of its members, the Bar would have by now taken affirmative steps and much more meaningful ones than its pious protestations of so-called ‘Keller-purity.’

Moreover, how does lobbying against voluntary bar legislation that has nothing to do with intruding on the Court’s lawyer regulation authority or with improving the quality of legal services satisfy the criteria under Keller? It doesn’t.

Instead, the Bar complies with Keller under the broadest of interpretations. Anything and everything goes so long as the activities encompass “core interests of the mandatory bar, interests of the legal profession, improve the administration of justice, or promote advancements in Arizona jurisprudence.” And oh, just in case, there’s the ‘catch-all’ —  “any other activity authorized by law.” See Criteria so expansive you could drive a dump truck through it.”

Assuming members ever find out about objectionable activities — and only after the fact — the Arizona Bar says members have “the option of challenging the Bar to ensure that any position taken is within the Keller guidelines.”  This is a purgative past the point of needing it. What matter if a member objects to the Bar’s lobbying against legislation protecting attorney free speech if the objection occurs after the lobbying has killed the legislation? It’s a nickel-and-dime ‘remedy’ so not much of one.

No separation of powers problem.

Wildlife & Animals 5041The State Bar’s last-ditch efforts to block the bill in the House last week also centered on alleged separation of powers grounds. On the House Floor, Rep. Randall Friese, D-Tucson, a leading opponent argued that the Legislature was overstepping its bounds. He told a local newspaper, “I’m afraid this bill specifically directs the Supreme Court to do certain things. And I’m still concerned this body cannot.”

But this is incorrect as was pointed out in a well-crafted separation of powers legal memorandum that maintains “HB 2221 is consistent with the Legislature’s authority to protect constitutional rights and assure transparency in government, while respecting the Supreme Court’s role in attorney regulation.”

Friese is an Arizona physician. But unlike Arizona attorneys, he is not required to join a professional trade association to practice his profession. His only precondition to earn a living as a doctor is to pay the Arizona Medical Board $500 every two years for regulation and licensing.

Unfortunately, ‘what’s sauce for this goose is not sauce for that gander.’ In spite of the obvious intellectual inconsistency, the good doctor is not dissuaded. He’ll continue carrying water for the Bar against any legislation that puts lawyers on the same footing as his profession.

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