Appeals court ruling upholds Texas ban on 'ambulance chasing'

Marilyn Tennissen Jun. 28, 2011, 3:49am


NEW ORLEANS -- It is illegal for a Texas attorney or medical professional to communicate with potential clients within 30 days of an accident or arrest, federal appellate justices ruled in a recent decision that upholds the constitutionality of Texas barratry laws.

On June 8, the U.S. Court of Appeals for the Fifth Circuit reversed a district judge's ruling that the Texas Penal Code relating to barratry and solicitation of professional employment violates the Texas and U.S. Constitutions.

In law practice, barratry refers to the generation of profit for legal services by an attorney who stirs up a dispute and encourages lawsuits in order to file what is typically a groundless claim. It is illegal in all states.

In 2009, Houston attorney Christopher Villasana and Austin chiropractor Donald McKinley challenged the constitutionality of the state's barratry code. They brought suit in the Western District of Texas seeking a declaratory judgment.

After a bench trial, a district court judge entered judgment for them, holding that the code is unconstitutional as applied to written solicitations, in-person and telephone communications as it violates the U.S. Constitution's First Amendment guarantee of free speech

Texas Attorney General Greg Abbott appealed the district court's judgment, and the Fifth Circuit justices have now reversed the lower court.

According to court documents, the Texas Barratry Statute regulates solicitation of professional employment by an attorney, chiropractor, physician, surgeon, private investigator or any person certified by a state regulatory agency.

Violations of the act could result in a fine up to $4,000, up to one year in jail, or both.

The statute originally only dealt with written communications, but was amended in 2009 to include solicitations by telephone or in person.

Villasana and McKinley filed their legal challenge Aug. 27, 2009, days before the amendment (House Bill 148) went into effect on Sept. 1, 2009.

Villasana, an attorney, challenged the portion that prohibits written solicitation of persons who had been arrested or received a summons within 30 days of the arrest or receipt of the summons.

McKinley challenged all forms of solicitation by chiropractors of accident victims within the first 30 days. He claimed free speech and equal protection were secured by both the U.S. and Texas constitutions.

The problem with the statute, they argued, is that it is too broad and should be limited to misleading or deceptive communications.

"Instead, it operates as a complete and total ban against the proscribed communication, and no warnings or disclosures made with the communication, regardless of how truthful or informative the communication may be, can rescue the communicator from committing an offense under the broad sweep of the prohibitions," they wrote.

Villasana, licensed to practice law since 1995, focuses his practice on traffic tickets and representing people who warrants issued for failing to appear.

He has been mailing "truthful, non-deceptive" advertisements to people who are cited for traffic tickets and people who have arrest warrants.

"My advertisements are truthful and helpful, and they are mailed as soon as possible after the ticket or warrant list is developed," Villasana wrote. "Waiting 31 days to mail out such an advertisement would render the advertisement moot and, effectively, prevent my sharing of truthful information with potential clients."

He claimed his mailings were helpful to people who may have forgotten about due dates on their tickets or may have missed court.

"Thus the vast majority of my clients are very glad to receive notices from me and both the ticket issuance and of the Missed Court advertisements."

Villasana said the prohibitions force him to spend more money on mass advertising like billboards, television and yellow pages ads, but prevent his "inexpensive, unobtrusive and truthful ads."

"I do not want to waste a lot of resources advertising to people who did not receive tickets and are not on the arrest warrant list," Villasana wrote.

However, the Fifth Circuit justices were not sympathetic. They applied a previous U.S. Supreme Court decision, Central Hudson.

Under Central Hudson and "a long line of Supreme Court precedent," a state has a compelling interest in the licensing and regulation of professions within its boundaries.

In addition, they wrote that the McKinley case provided ample evidence that the harm caused by solicitation of accident victims within the first 30 days after an accident is real.

"And we conclude that a rule prohibiting solicitation for a 30 day period materially alleviates that harm by preventing the harm identified by the state for the amount of time needed," wrote Justice Thomas Reavely.

The statute, justices concluded, is not more extensive than necessary and is reasonable and appropriate.

"Accordingly, we dismiss the state law claims of both Appellees and the federal claims of attorney Villasana, and we reverse and remand McKinley's federal claims for proceedings not inconsistent with this opinion," Reavely wrote.

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