Barratry
Barratry Code of Conduct
Barratry is an unlawful act performed by a lawyer who provokes a conflict or otherwise invites the filing of a lawsuit so he or she can profit from the legal fees.
It usually involves an unfounded (frivolous) claim being filed so the attorney can collect payment from clients.
In the United States, barratry is illegal. An attorney perpetrator is liable to a criminal penalty and disciplinary action by the state bar, which would generally put a lawyer at risk of disbarment.
Section 82.0651 – Civil Liability for Prohibited Barratry(a) A client may bring an action to void a contract for legal services that was procured as a result of conduct violating Section 38.12(a) or (b), Penal Code, or Rule 7.03 of the Texas Disciplinary Rules of Professional Conduct of the State Bar of Texas, regarding barratry by attorneys or other persons, and to recover any amount that may be awarded under Subsection (b). A client who enters into a contract described by this subsection may bring an action to recover any amount that may be awarded under Subsection (b) even if the contract is voided voluntarily.(b) A client who prevails in an action under Subsection (a) shall recover from any person who committed barratry:(1) all fees and expenses paid to that person under the contract;(2) the balance of any fees and expenses paid to any other person under the contract, after deducting fees and expenses awarded based on a quantum meruit theory as provided by Section 82.065(c);(3) actual damages caused by the prohibited conduct;(4) a penalty in the amount of $10,000; and(5) reasonable and necessary attorney’s fees.(c) A person who was solicited by conduct violating Section 38.12(a) or (b), Penal Code, or Rule 7.03 of the Texas Disciplinary Rules of Professional Conduct of the State Bar of Texas, regarding barratry by attorneys or other persons, but who did not enter into a contract as a result of that conduct, may file a civil action against any person who committed barratry.(d) A person who prevails in an action under Subsection (c) shall recover from each person who engaged in barratry:(1) a penalty in the amount of $10,000;(2) actual damages caused by the prohibited conduct; and(3) reasonable and necessary attorney’s fees.(e) This section shall be liberally construed and applied to promote its underlying purposes, which are to protect those in need of legal services against unethical, unlawful solicitation and to provide efficient and economical procedures to secure that protection.(f) The provisions of this subchapter are not exclusive. The remedies provided in this subchapter are in addition to any other procedures or remedies provided by any other law, except that a person may not recover damages and penalties under both this subchapter and another law for the same act or practice.(g) The expedited actions process created by Rule 169, Texas Rules of Civil Procedure, does not apply to an action under this section.
Tex. Gov’t. Code § 82.0651
Sec. 38.12. BARRATRY AND SOLICITATION OF PROFESSIONAL EMPLOYMENT. (a) A person commits an offense if, with intent to obtain an economic benefit, the person:
(1) knowingly institutes a suit or claim that the person has not been authorized to pursue;
(2) solicits employment, either in person or by telephone, for himself or for another;
(3) pays, gives, or advances or offers to pay, give, or advance to prospective client money or anything of value to obtain employment as a professional from the prospective client;
(4) pays or gives or offers to pay or give a person money or anything of value to solicit employment;
(5) pays or gives or offers to pay or give a family member of a prospective client money or anything of value to solicit employment; or
(6) accepts or agrees to accept money or anything of value to solicit employment.
(b) A person commits an offense if the person:
(1) knowingly finances the commission of an offense under Subsection (a);
(2) invests funds the person knows or believes are intended to further the commission of an offense under Subsection (a); or
(3) is a professional who knowingly accepts employment within the scope of the person’s license, registration, or certification that results from the solicitation of employment in violation of Subsection (a).
(c) It is an exception to prosecution under Subsection (a) or (b) that the person’s conduct is authorized by the Texas Disciplinary Rules of Professional Conduct or any rule of court.
(d) A person commits an offense if the person:
(1) is an attorney, chiropractor, physician, surgeon, or private investigator licensed to practice in this state or any person licensed, certified, or registered by a health care regulatory agency of this state; and
(2) with the intent to obtain professional employment for the person or for another, provides or knowingly permits to be provided to an individual who has not sought the person’s employment, legal representation, advice, or care a written communication or a solicitation, including a solicitation in person or by telephone, that:
(A) concerns an action for personal injury or wrongful death or otherwise relates to an accident or disaster involving the person to whom the communication or solicitation is provided or a relative of that person and that was provided before the 31st day after the date on which the accident or disaster occurred;
(B) concerns a specific matter and relates to legal representation, and the person knows or reasonably should know that the person to whom the communication or solicitation is directed is represented by a lawyer in the matter;
(C) concerns a lawsuit of any kind, including an action for divorce, in which the person to whom the communication or solicitation is provided is a defendant or a relative of that person unless the lawsuit in which the person is named as a defendant has been on file for more than 31 days before the date on which the communication or solicitation was provided;
(D) is provided or permitted to be provided by a person who knows or reasonably should know that the injured person or relative of the injured person has indicated a desire not to be contacted by or receive communications or solicitations concerning employment;
(E) involves coercion, duress, fraud, overreaching, harassment, intimidation, or undue influence; or
(F) contains a false, fraudulent, misleading, deceptive, or unfair statement or claim.
(e) For purposes of Subsection (d)(2)(D), a desire not to be contacted is presumed if an accident report reflects that such an indication has been made by an injured person or that person’s relative.
(f) An offense under Subsection (a) or (b) is a felony of the third degree.
(g) Except as provided by Subsection (h), an offense under Subsection (d) is a Class A misdemeanor.
(h) An offense under Subsection (d) is a felony of the third degree if it is shown on the trial of the offense that the defendant has previously been convicted under Subsection (d).
(i) Final conviction of felony barratry is a serious crime for all purposes and acts, specifically including the State Bar Rules and the Texas Rules of Disciplinary Procedure.
Rule 7.03. Solicitation and Other Prohibited Communications
(a) The following definitions apply to this Rule:
(1) “Regulated telephone, social media, or other electronic contact” means telephone, social
media, or electronic communication initiated by a lawyer, or by a person acting on behalf of a
lawyer, that involves communication in a live or electronically interactive manner.
(2) A lawyer “solicits” employment by making a “solicitation communication,” as that term is
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defined in Rule 7.01(b)(2).
(b) A lawyer shall not solicit through in-person contact, or through regulated telephone, social media, or
other electronic contact, professional employment from a non-client, unless the target of the solicitation
is:
(1) another lawyer;
(2) a person who has a family, close personal, or prior business or professional relationship with
the lawyer; or
(3) a person who is known by the lawyer to be an experienced user of the type of legal services
involved for business matters.
(c) A lawyer shall not send, deliver, or transmit, or knowingly permit or cause another person to send,
deliver, or transmit, a communication that involves coercion, duress, overreaching, intimidation, or
undue influence.
(d) A lawyer shall not send, deliver, or transmit, or knowingly permit or cause another person to send,
deliver, or transmit, a solicitation communication to a prospective client, if:
(1) the communication is misleadingly designed to resemble a legal pleading or other legal
document; or
(2) the communication is not plainly marked or clearly designated an “ADVERTISEMENT”
unless the target of the communication is:
(i) another lawyer;
(ii) a person who has a family, close personal, or prior business or professional relationship
with the lawyer; or
(iii) a person who is known by the lawyer to be an experienced user of the type of legal
services involved for business matters.
(e) A lawyer shall not pay, give, or offer to pay or give anything of value to a person not licensed to
practice law for soliciting or referring prospective clients for professional employment, except nominal
gifts given as an expression of appreciation that are neither intended nor reasonably expected to be a
form of compensation for recommending a lawyer’s services.
(1) This Rule does not prohibit a lawyer from paying reasonable fees for advertising and public
relations services or the usual charges of a lawyer referral service that meets the requirements of
Texas law.
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(2) A lawyer may refer clients to another lawyer or a nonlawyer professional pursuant to an
agreement not otherwise prohibited under these Rules that provides for the other person to refer
clients or customers to the lawyer, if:
(i) the reciprocal referral agreement is not exclusive;
(ii) clients are informed of the existence and nature of the agreement; and
(iii) the lawyer exercises independent professional judgment in making referrals.
(f) A lawyer shall not, for the purpose of securing employment, pay, give, advance, or offer to pay, give,
or advance anything of value to a prospective client, other than actual litigation expenses and other
financial assistance permitted by Rule 1.08(d), or ordinary social hospitality of nominal value.
(g) This Rule does not prohibit communications authorized by law, such as notice to members of a class
in class action litigation.
Comment:
Solicitation by Public and Charitable Legal Services Organizations
1. Rule 7.01 provides that a “‘solicitation communication’ is a communication substantially motivated by
pecuniary gain.” Therefore, the ban on solicitation imposed by paragraph (b) of this Rule does not apply
to the activities of lawyers working for public or charitable legal services organizations.
Communications Directed to the Public or Requested
2. A lawyer’s communication is not 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 made in
response to a request for information, including an electronic search for information. The terms
“advertisement” and “solicitation communication” are defined in Rule 7.01(b).
The Risk of Overreaching
3. A potential for overreaching exists when a lawyer, seeking pecuniary gain, solicits a person known to
be in need of legal services via in-person or regulated telephone, social media, or other electronic contact.
These forms of contact subject a person to the private importuning of the trained advocate in a direct
interpersonal encounter. The person, who may already feel overwhelmed by the circumstances giving
rise to the need for legal services, may find it difficult to fully evaluate all available alternatives with
reasoned judgment and appropriate self‑interest in the face of the lawyer’s presence and insistence upon
an immediate response. The situation is fraught with the possibility of undue influence, intimidation, and
overreaching.
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4. The potential for overreaching that is inherent in in-person or regulated telephone, social media, or
other electronic contact justifies their prohibition, since lawyers have alternative means of conveying
necessary information. In particular, communications can be sent by regular mail or e-mail, or by other
means that do not involve communication in a live or electronically interactive manner. These forms of
communications make it possible for the public to be informed about the need for legal services, and
about the qualifications of available lawyers and law firms, with minimal risk of overwhelming a person’s
judgment.
5. The contents of live person-to-person contact can be disputed and may not be subject to third‑party
scrutiny. Consequently, they are much more likely to approach (and occasionally cross) the dividing line
between accurate representations and those that are false and misleading.
Targeted Mail Solicitation
6. Regular mail or e-mail targeted to a person that offers to provide legal services that the lawyer knows
or reasonably should know the person needs in a particular matter is a solicitation communication within
the meaning of Rule 7.01(b)(2), but is not prohibited by subsection (b) of this Rule. Unlike in-person
and electronically interactive communication by “regulated telephone, social media, or other electronic
contact,” regular mail and e-mail can easily be ignored, set aside, or reconsidered. There is a diminished
likelihood of overreaching because no lawyer is physically present and there is evidence in tangible or
electronic form of what was communicated. See Shapero v. Kentucky B. Ass’n, 486 U.S. 466 (1988).
Personal, Family, Business, and Professional Relationships
7. There is a substantially reduced likelihood that a lawyer would engage in overreaching against a former
client, a person with whom the lawyer has a close personal, family, business or professional relationship,
or in situations in which the lawyer is motivated by considerations other than pecuniary gain. Nor is there
a serious potential for overreaching when the person contacted is a lawyer or is known to routinely use
the type of legal services involved for business purposes. Examples include persons who routinely hire
outside counsel to represent an entity; entrepreneurs who regularly engage business, employment law,
or intellectual property lawyers; small business proprietors who routinely hire lawyers for lease or
contract issues; and other people who routinely retain lawyers for business transactions or formations.
Constitutionally Protected Activities
8. Paragraph (b) is not intended to prohibit a lawyer from participating in constitutionally protected
activities of public or charitable legal-service organizations or bona fide political, social, civic, fraternal,
employee, or trade organizations whose purposes include providing or recommending legal services to
their members or beneficiaries. See In re Primus, 436 U.S. 412 (1978).
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Group and Prepaid Legal Services Plans
9. This Rule does not prohibit a lawyer from contacting representatives of organizations or entities that
may be interested in establishing a group or prepaid legal plan for their members, insureds, beneficiaries,
or other third parties. Such communications may provide information about the availability and terms
of a plan which the lawyer or lawyer’s firm is willing to offer. This form of communication is not directed
to persons who are seeking legal services for themselves. Rather, it is usually addressed to a fiduciary
seeking a supplier of legal services for others, who may, if they choose, become prospective clients of the
lawyer. Under these circumstances, the information transmitted is functionally similar to the types of
advertisements permitted by these Rules.
Designation as an Advertisement
10. For purposes of paragraph (d)(2) of this Rule, a communication is rebuttably presumed to be “plainly
marked or clearly designated an ‘ADVERTISEMENT’” if: (a) in the case of a letter transmitted in an
envelope, both the outside of the envelope and the first page of the letter state the word
“ADVERTISEMENT” in bold face all-capital letters that are 3/8” high on a uncluttered background; (b)
in the case of an e-mail message, the first word in the subject line is “ADVERTISEMENT” in all capital
letters; and (c) in the case of a text message or message on social media, the first word in the message is
“ADVERTISEMENT” in all capital letters.
Paying Others to Recommend a Lawyer
11. This Rule allows a lawyer to pay for advertising and communications, including the usual costs of
printed or online directory listings or advertisements, television and radio airtime, domain-name
registrations, sponsorship fees, and group advertising. A lawyer may compensate employees, agents, and
vendors who are engaged to provide marketing or client development services, such as publicists, publicrelations personnel, business-development staff, television and radio station employees or
spokespersons, and website designers.
12. This Rule permits lawyers to give nominal gifts as an expression of appreciation to a person for
recommending the lawyer’s services or referring a prospective client. The gift may not be more than a
token item as might be given for holidays, or other ordinary social hospitality. A gift is prohibited if
offered or given in consideration of any promise, agreement, or understanding that such a gift would be
forthcoming or that referrals would be made or encouraged in the future.
13. A lawyer may pay others for generating client leads, such as Internet-based client leads, as long as the
lead generator does not recommend the lawyer, any payment to the lead generator is consistent with
Rule 5.04(a) (division of fees with nonlawyers) and Rule 5.04(c) (nonlawyer interference with the
professional independence of the lawyer), and the lead generator’s communications are consistent with
Rule 7.01 (communications concerning a lawyer’s services). To comply with Rule 7.01, a lawyer must
not pay a lead generator that states, implies, or creates a reasonable impression that it is recommending
the lawyer, is making the referral without payment from the lawyer, or has analyzed a person’s legal
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problems when determining which lawyer should receive the referral. See also Rule 5.03 (duties of
lawyers and law firms with respect to the conduct of nonlawyers); Rule 8.04(a)(1) (duty to avoid violating
the Rules through the acts of another).
Charges of and Referrals by a Legal Services Plan or Lawyer Referral Service
14. A lawyer may pay the usual charges of a legal services plan or a not-for-profit or qualified lawyer
referral service. A legal service plan is a prepaid or group legal service plan or a similar delivery system
that assists people who seek to secure legal representation. A lawyer referral service, on the other hand,
is any organization that holds itself out to the public as a lawyer referral service. Qualified referral services
are consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate
experience in the subject matter of the representation and afford other client protections, such as
complaint procedures or malpractice insurance requirements.
15. A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer
referral service must act reasonably to assure that the activities of the plan or service are compatible with
the lawyer’s professional obligations. Legal service plans and lawyer referral services may communicate
with the public, but such communication must be in conformity with these Rules. Thus, advertising must
not be false or misleading, as would be the case if the communications of a group advertising program
or a group legal services plan would mislead the public to think that it was a lawyer referral service
sponsored by a state agency or bar association.
Reciprocal Referral Arrangements
16. A lawyer does not violate paragraph (e) of this Rule by agreeing to refer clients to another lawyer or
nonlawyer professional, so long as the reciprocal referral agreement is not exclusive, the client is
informed of the referral agreement, and the lawyer exercises independent professional judgment in
making the referral. Reciprocal referral agreements should not be of indefinite duration and should be
reviewed periodically to determine whether they comply with these Rules. A lawyer should not enter into
a reciprocal referral agreement with another lawyer that includes a division of fees without determining
that the agreement complies with Rule 1.04(f).
Meals or Entertainment for Prospective Clients
17. This Rule does not prohibit a lawyer from paying for a meal or entertainment for a prospective client
that has a nominal value or amounts to ordinary social hospitality.
Source Links
State Bar of Texas Rule 7.03
(Pgs. 101-106)
Government Code 82.0651
https://statutes.capitol.texas.gov/Docs/GV/htm/GV.82.htm
Penal Code Section 38.12
