A proposed amendment to the Texas Disciplinary Rules of Professional Conduct that prohibits attorneys from having sex with clients was one of the hottest topics during a Sept. 1 public hearing on the proposals in Houston. At the hearing, Houston solo Rich Robins said the proposed amendment to Rule 1.13 could make lawyers susceptible to grievances if a client dissatisfied with a settlement makes a false accusation. Robins said that he “doesn’t engage in it,” but he doesn’t think there should be a disciplinary rule banning sex with clients. “If it’s consensual, what’s wrong with it?” Robins asked during the State Bar of Texas hearing, which was attended by about 50 people, mostly lawyers. Tom Watkins , chairman of the Supreme Court task force that developed the proposed amendments to the disciplinary rules, said the intent of the no-sex rule is to prevent lawyers from giving advice to a “paramour.” Watkins, a partner in Brown McCarroll in Austin, said of the rule, “I think it ought to be in there.” He also noted that some Texas lawyers have complained that the proposed rule isn’t strong enough. Last month more than a dozen women lawyers argued just that in an e-mail urging the Texas Supreme Court and the State Bar of Texas to adopt a stronger rule. [See "Do the Rule Right," Texas Lawyer, Aug. 30, 2010, page 4.] Another amendment criticized at the hearing is proposed Rule 1.05, which calls for a lawyer to disclose confidential information if he has information “clearly establishing that a client is likely to commit a criminal or fraudulent act that is likely to result in death or substantial bodily harm to a person.” Thomas Pickford , a partner in Hoover Slovacek in Houston, said the word “substantial” should be removed from proposed Rule 1.05 because sanctioning any form of bodily injury is not appropriate. Regarding another proposed change, Charles “Chuck” Herring Jr. , a partner in Herring & Irwin in Austin, asked Watkins if amendments to Rule 1.07 that deal with conflicts of interest are intended to apply conflicts checks to contract lawyers working for a firm. Watkins said the rule would apply to contract lawyers. The hearing in Houston was the third of nine scheduled prior to Oct. 1, when the Bar’s board of directors will consider the amendments.
Contingent Fee Intact
Houston-based firm Bailey Perrin Bailey has won a victory at the Pennsylvania Supreme Court regarding its representation of the Commonwealth of Pennsylvania on a contingent-fee basis in a suit against the manufacturer of the prescription anti-psychotic medication Risperdal. In a 5-1 decision Aug. 17, Pennsylvania’s high court held that Janssen Pharmaceutica Inc. lacks standing to challenge Bailey Perrin’s representation under 71 P.S. §723-103. Chief Justice Ronald Castillo wrote for the Supreme Court majority in Commonwealth, Office of General Counsel v. Janssen Pharmaceutica Inc. , “The obvious interpretation of Section 103 is that no party to an action, other than the Commonwealth agency involved in the action itself, may challenge the authority of the agency’s legal representation.” According to the Supreme Court’s majority opinion, in January 2008, the Office of General Counsel had filed a complaint against Janssen in the Court of Common Pleas of Philadelphia County regarding its marketing of Risperdal. In January 2009, after the trial court denied Janssen’s motion to disqualify Bailey Perrin as the Commonwealth’s counsel, Janssen filed an application for extraordinary relief in the Pennsylvania Supreme Court. As noted in the Supreme Court’s majority opinion, Janssen alleged, among other things, that Bailey Perrin’s contingent-fee agreement for 15 percent of any damages the firm recovers for the Commonwealth restricts the Office of General Counsel’s authority to settle the litigation for nonmonetary relief. But the Supreme Court’s ruling is a hollow victory for the Texas firm. Bailey Perrin partner F. Kenneth Bailey says, “The only silver lining in this so far has been the fact that we won at the Supreme Court on our representation.” As noted in the Supreme Court’s majority opinion, Court of Common Pleas Judge Frederica Massiah-Jackson of Philadelphia granted Janssen’s motion for a compulsory nonsuit of the state’s underlying litigation against Janssen on June 14. Bailey says the Commonwealth plans to appeal Massiah-Jackson’s decision. Edward Posner , Janssen’s attorney and a partner in Drinker Biddle & Reath in Philadelphia, declines comment on the case and refers questions to Janssen. Janssen spokeswoman Kara Russell writes in an e-mail that the company is disappointed by the Pennsylvania Supreme Court’s decision. “Lawyers representing a state in matters like this one should not have a financial interest in the outcome of the case,” Russell writes.
