Client Chasing or Customer Outreach and Facilitating Access to Justice: It's time to talk about the wisdom of barratry before and after 31 days are up
On Nov. 29, 2017, the Eight Court of Appeals in El Paso affirmed the conviction of Ronald Eugene Reynolds on barratry charges. Ronald Eugene Reynold v The State of Texas, No. 08-15-00372-CR (Nov. 29, 2017) See opinion here. Text also pasted below. Click docket number above to go to the court's web page for of the five parallel criminal cases. Opinions were issued separately for each case, but they appear to be almost identical.
Reynolds had at least four strikes against him: he is black, he is a trial lawyer, he is a Democrat (a politician, no less), and he represented himself pro se at his criminal trial. A jury trial. Apparently not because he was unawares of the old adage about that guy choosing to represents himself having a fool for a client, and vice versa, but because he had run out of money to bankroll his defense.
Finally, he was tried in Montgomery County, a heavily white and Republican county, even though he does not even office there. He was prosecuted there because he permitted someone else to commit barratry there.
That said, it sure looks like he was guilty, the way the facts are being portrayed in the appellate opinion (the voluminous record from the jury trial is not available to the general public online).
But would others have been convicted for similar conduct? And what conduct, in any event?
Let me start by saying that I am no apologist of Ronald Reynolds, and I have - in fact - written about his disciplinary issues before. See here and here. For all know from secondary sources, he may very well be a sleazebag, or even a crook.
But here is the thing:
The crux of the criminal case against Reynolds is that the solicitation of clients took place before 31 days had expired from the event that would be the subject matter of the legal representation, i.e. the accident, since he is a PI lawyer.
31 days is an arbitrary amount of time set by state law, which makes for a technical violation if not heeded. Doing it before the critical 31-day time point rather than afterward may be unlawful, but it does not make the conduct at issue inherently immoral or per se harmful. See State v. Sandoval, 842 S.W.2d 782, 788 (Tex. App.-Corpus Christi 1992, pet. ref'd) ("The culpability required under the [barratry] statute is the intent `to obtain an economic benefit.'"). The intent to obtain an economic benefit is not inherently evil. It forms the basis of a free-market economy.
And what was the conduct in any event? -- Obtaining clients that actually benefitted from the lawyer's outreach and marketing efforts.
To be sure, he was not recruiting clients out of the goodness of his heart or to increase his pro bono docket to earn cookie points, a badge of honor for altruism, or honorable mention in the Texas Bar Journal. Much rather, the purpose was to make money. And the clients would benefit from those efforts and may otherwise not as easily have found a lawyer on their own. The clients apparently were unaware of the barratry-law violation and did not complain, and weren't victims in any but a technical sense of the term. In fact, they were being helped. If anyone was harmed, it would be follow lawyers competing for the same pool of people with claims, to the extent those lawyers observed the one-month non-solicitation period and were therefore at a competitive disadvanage.
The law as written must, of course, be followed. And if the law be bad, the Texas Legislature can in its great aggregate and representative wisdom, change it, or repeal it altogether.
But here is the rub:
Other lawyers have also found that the Texas law that bars solicitation of clients before 31 days have elapsed was not good for their business, and chose to ignore it. Did they go to jail? - No. They went to court too, but they got the law declared unconstitutional.
One of them actually filed an affidavit complaining how the barratry law cut into his business because he had been contacting would-be clients faster than his competitors, until he was sued for illegal barratry in a civil court of law and stopped doing it temporarily.
So it was not "ambulance chasing" alright. But how was soliciting debt-suit defendants not not "client chasing"? And unlike personal injury claimants with contingency fee contracts, those clients would have to fork over money up front for their defense of a debt collection suit filed against them. Which of the two categories of would-be clients was more vulnerable?
There is no indication in the press coverage or in the appellate opinion that Reynolds launched a constitutional attack on the statute under which he was convicted. Perhaps he was not smart enough himself or not sufficiently lawyered up for that challenging venue, or perhaps someone like him had no chance to get the consideration that others were graced with. After all, he is a personal injury lawyer, a Democrat, and an African-American one at that.
Below are some docs from Shearer v Reister, wherein a certain prolific solicitor got the Dallas DA into his civil barratry case, and in due course procured a judicial declaration that the barratry law is unenforceable as against him and his law firm.
Seems like something is not right here. And it's probably not just a matter of race. Whatever it is, it deserves some serious discussion. Serious discussion as to why marketing by attorneys and outreach to would-be customers is a crime. A jailable offense for some, but not for others.
RONALD EUGENE REYNOLDS, Appellant,
v.
THE STATE OF TEXAS, Appellee.
Court of Appeals of Texas, Eighth District, El Paso.
Brett Ligon, for State of Texas.
Ralph Martinez, Ronald Eugene Reynolds, for Ronald Eugene Reynolds, Appellant.
Appeal from County Court at Law No. 4 of Montgomery County, Texas, (TC # 15-307888).
Before McClure, C.J., Rodriguez, and Palafox, JJ.
Do Not Publish
OPINION
ANN CRAWFORD McCLURE, Chief Justice.
In a series of barratry cases, all tried together, a jury convicted Ronald Eugene Reynolds of five misdemeanor charges under TEX.PENAL CODE ANN. § 38.12(d)(West 2016). This appeal relates to the solicitation of Kuh Taw, who was contacted within thirty-one days of a traffic accident in which he was involved, and signed up as Appellant's client. Appellant challenges the legal sufficiency of the evidence to support his conviction, the admission of extraneous offense evidence, and the venue in which this case was tried. We affirm.[1]
BARRATRY
The offense of barratry, sometimes described as stirring up litigation, has been a crime in Texas since 1876. Katherine A. Laroe, Comment, Much Ado About Barratry: State Regulation of Attorneys' Targeted Direct-Mail Solicitation, 25 St. Mary's L.J. 1513, 1519-20 n.28 (1994)(also tracing historical basis of offense through pre-colonial times). As far back as 1917, Texas outlawed a distinct form of barratry—use of a third party (a "runner") to solicit clients on behalf of a lawyer. Id. at 1524 n.30. In a different form, that prohibition exists today in TEX.PENAL CODE ANN. § 38.12(d)(West 2016) which criminalizes a lawyer knowingly permitting a third party to improperly solicit on the lawyer's behalf employment from a victim within thirty-one days of an accident.[2] Under the text of the statute, a lawyer commits an offense when he or she:
(d)(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.
Stated otherwise: (1) a lawyer, (2) cannot with intent to obtain professional employment, (3) provide or knowingly permit to be provided to someone who hasn't sought the lawyer's services, (4) a written communication or a solicitation (in person or by phone), (5) in the first thirty days following some accident or disaster.
FACTUAL SUMMARY
Robert Valdez, and his ex-wife, Crystal Valdez, ran a scheme that we can only hope is a rarity in personal injury litigation. Robert had Crystal scour the Houston Police Department's website for recent traffic accidents, and then obtain the corresponding police accident reports. The manner in which she did so allowed them to obtain the traffic accident report within two to three days of the accident. Robert believed this important so they could contact the not-at-fault driver before he or she had signed with a lawyer. Crystal would then call the not-at-fault motorist to set up a meeting with Robert. He, or an associate, would then meet face-to-face with that person to sign them up with a lawyer. At the meeting, Robert had a blank attorney client contract for one of several law firms. He had a standing arrangement with those lawyers whereby they would pay him a set fee for each referral. Robert also directed the traffic accident victims to two injury clinics that he controlled, and to auto-body shops that paid him referral fees. Crystal would pull some 20-25 accident reports a day, leading to two follow up appointments a day.
These facts are not disputed in our record. What is disputed is whether Appellant was one of the attorneys to which referrals were made, and whether Appellant knew that five specific clients made the basis of the charged conduct here were solicited in this fashion.
The State learned of the Valdezes' scheme when Robert was in jail for an unrelated assault charge. Crystal, who claimed that Robert was abusive towards her, took that opportunity to contact the authorities and confess the scheme. Investigators from the Montgomery County District Attorney's Office, joined by the Texas Rangers, met Crystal at the Valdez residence in Montgomery County. They collected books and records that documented the hundreds of accident victims that had been referred to various lawyers. Robert soon pled guilty to barratry and agreed to testify against the several lawyers also charged. His testimony provided the following account of his scheme.
Testimony of Robert Valdez
After being released from the State prison in 2007 on drug charges, Robert found work as a truck driver. Through social and work contacts, he learned of persons involved in traffic accidents and passed their phone numbers along to his brother. In return, Robert's brother would give Robert some small sum, such as gas money, for each phone number that he could provide. Robert claims to have averaged about five phone numbers per month.
