INVESTIGATIVE CONDUCT Including Ethics Opinion #600

Transcription

1 INVESTIGATIVE CONDUCT Including Ethics Opinion #600 HUGH M. BARTON, III, Austin Attorney at Law State Bar of Texas 23 RD ANNUAL ADVANCED ADMINISTRATIVE LAW COURSE June 30 July 1, 2011 Austin CHAPTER 15

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3 Hugh M. Barton A Professional Corporation Attorney at Law th 819½ West 11 Street Austin, TX bartonlaw@yahoo.com ( ) Hugh M. Barton is an attorney in private practice in Austin, Texas. He received his undergraduate degree from the Cox School of Business at Southern Methodist University and his law degree from the University of Tulsa College of Law. Mr. Barton has practiced law for 31 years, and health law for 27 years. He previously served as Assistant District Attorney in Trinity, Polk and San Jacinto Counties, as an Assistant Attorney General with the Texas Attorney General s Medicaid Fraud Control Unit, and as Assistant General Counsel at the Texas Medical Association. Mr. Barton concentrates on regulatory, administrative and transactional health care matters, advising health care providers on operational issues, Medicare, Medicaid and private payor reimbursement matters, resolution of issues with regulatory agencies, such as licensing and disciplinary matters, as well as assisting criminal counsel in defense of health fraud cases. Mr. Barton is Board Certified in Health Law by the Texas Board of Legal Specialization and is a Past Chair of the State Bar of Texas Health Law Section. He is a frequent speaker and has published 139 articles on health law.

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5 TABLE OF CONTENTS I. INTRODUCTION... 1 II. THE TEXAS DISCIPLINARY RULES OF PROFESSIONAL CONDUCT IN GENERAL... 1 A. APPLICABILITY B. BASIC RULES... 1 III. ETHICAL STANDARDS APPLICABLE TO GOVERNMENT LAWYERS IN GENERAL... 2 A. In General B. Section 13 of the TDPRC Preamble:... 2 C. TDPRC 1.05/Confidentiality Of Information:... 2 D. TDPRC 1.12/the Organization as a Client:... 2 E. TDPRC 2.10/Role of Attorney as Advisor to Client... 4 F. TDPRC 4.02/Communication with One Represented by Counsel... 4 G. TDPRC 5.03/Responsibilities Regarding Nonlawyer Assistants... 4 IV. ETHICAL STANDARDS APPLICABLE TO PROSECUTORS... 4 A. In General B. TDPRC 3.09/special Responsibilities of Prosecutors... 4 C. Problem Areas D. Connick v. Thompson V. ADMINISTRATIVE AGENCY INVESTIGATIONS... 6 A. Introduction... 6 B. Initial Evaluation C. Gathering and Evaluating Data D. Field Work E. Report Preparation F. Internal Review G. Where Is the Agency Attorney During the Investigation?... 7 VI. TEXAS ETHICS OPINION NO A. Introduction B. Facts... 8 C. Questions D. Conclusions VII. TEXAS ETHICS OPINION NO A. Introduction B. Facts... 9 C. Question... 9 D. Discussion E. Conclusion VIII. SCENARIOS IMPLICATING OPINION NO A. Hypothetical B. Questions Appendix i

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7 INVESTIGATIVE CONDUCT Including Ethics Opinion #600 I. INTRODUCTION The purpose of this paper is to provide lawyers, both those working for governmental entities and those in private practice, with a perspective on ethical conduct in the course of the investigative process by a government lawyer. This issue is both curious in light of the issuance of Opinion 600 by the Professional Ethics Committee in August 2010, and important in light of recent press revelations of widespread prosecutorial misconduct and the Supreme Court s recent opinion in Connick v. Thompson. II. THE TEXAS DISCIPLINARY RULES OF PROFESSIONAL CONDUCT IN GENERAL A. APPLICABILITY. The Texas Disciplinary Rules of Professional Conduct ( TDRPC ) were adopted by the Texas Supreme Court in All lawyers admitted to practice in Texas are subject to the disciplinary jurisdiction of the Supreme Court (Tex. Gov t Code ), hence, all must abide by the TDPRC as minimum standards of practice. B. BASIC RULES. A complete discussion of the TDPRC is beyond the scope of this paper, but the ethical duties of lawyers are organized around the functional aspects of an lawyer s job. A brief summary is as follows: 1. The Attorney-Client Relationship: providing competent and diligent representation; maintain the confidentiality of information; avoid conflicts of interest; and not obstruct justice. 2. The Advisor Role: exercise independent professional judgment and rendering candid advice; and not evaluating a client matter for the use of someone other than the client unless compatible with other aspects of the representation and with client consent. 3. The Advocate Role: avoiding initiation of proceedings unless there is a non-frivolous basis for doing so; minimize burdens of litigation; maintain candor towards a tribunal; fairness in conduct of proceedings; maintain the impartiality of tribunals; and not making extrajudicial statements during trial that may prejudice outcome. 4. Dealings with Non-Clients: not make a false statement of fact or law to third persons; not circumvent the lawyer-client relationship existing between other persons; not state or imply that the lawyer is disinterested when dealing on behalf of a client with a person who is not represented by counsel; and not use means that have no substantial purpose other than to embarrass, delay, or burden a third person, or use methods of obtaining evidence that violate the rights of a person. 5. When In Law Firms: not share legal fees with a non-lawyer; not assist a non-lawyer to perform an of activity that is the unauthorized practice of law; use no agreement that restricts the rights of a lawyer to practice after termination of the relationship; and not manifest bias or prejudice based on race, color, national origin, religion, disability, age, sex, or sexual orientation towards a person involved in a proceeding. 6. Rendering Public Interest Legal Service: provide free legal services to those unable to pay reasonable fees; and not seek to avoid appointment by a tribunal to represent a person except for good cause. 7. Maintain the Integrity of the Profession: make no false statement of material fact in connection with bar admission or a disciplinary matter; inform a disciplinary authority that another lawyer has violated the rules of professional conduct when it raises a substantial question as to that lawyer s honesty, trustworthiness or fitness as a lawyer in other respects; 1

8 not engage in conduct involving dishonesty, fraud, deceit or misrepresentation; and not violate the rules of professional conduct through the acts of another. III. ETHICAL STANDARDS APPLICABLE TO GOVERNMENT LAWYERS IN GENERAL A. In General. The drafters of the TDPRC appreciated the position that government lawyers are in by delineating ways in which having a government agency for a client differ from having an individual or other entity as a client. B. Section 13 of the TDPRC Preamble: 13. The responsibilities of government lawyers, under various legal provisions, including constitutional, statutory and common law, may include authority concerning legal matters that ordinarily reposes in the client in private client-lawyer relationships. For example, a lawyer for a government agency may have authority on behalf of the government to decide upon settlement or whether to appeal from an adverse judgment. Such authority in various respects is generally vested in the attorney general and the states attorney in state government, and their federal counterparts, and the same may be true of other government law officers. Also, lawyers under the supervision of these officers may be authorized to represent s e veral government agencies i n intragovernmental legal controversies in circumstances where a private lawyer could not represent multiple private clients. They also may have authority to represent the public interest in circumstances where a private lawyer would not be authorized to do so. These rules do not abrogate any such authority. Comment: Section 13, like the rest of the TDPRC Preamble, is descriptive in nature only and provides no substantive guidance, other than to make it clear that, in certain situations, a government attorney may make decisions in legal matters that would otherwise be made by a client (individual or entity) in the context of an attorney in private practice. C. TDPRC 1.05/confidentiality of Information: The general rule is that an attorney shall not reveal confidential information of a client or former client to a person that the client has instructed not ro receive the information, or anyone else other than the client or members of the same law firm. Official Comment: The official TDPRC comment to this rule states that The requirement of confidentiality applies to government lawyers who may disagree with the policy goals that their representation is designed to advance. Comment: This is obviously designed to prevent a disgruntled government attorney from quitting their job and using certain information against the government agency. This might work to prohibit release of information about a particular case or cases, but knowledge about how an agency operates in general or how it approaches certain types of cases (for example, suppose an agency has an unofficial policy of bringing enforcement actions against a racial minority based on the biases of appointed officials) may well have larger public policy and First Amendment implications, not to mention Open Records and Open Meetings law implications. D. TDPRC 1.12/the Organization as a Client: (a) (b) A lawyer employed or retained by an organization represents the entity. While the lawyer in the ordinary course of working relationships may report to, and accept direction from, an entity's duly authorized constituents, in the situations described in paragraph (b) the lawyer shall proceed as reasonably necessary in the best interest of the organization without involving unreasonable risks of disrupting the organization and of revealing information relating to the representation to persons outside the organization. A lawyer representing an organization must take reasonable remedial actions whenever the lawyer learns or knows that: (1) an officer, employee, or other person associated with the organization has committed or intends to commit a violation of a legal obligation to the organization or a violation of law which reasonably might be imputed to the organization; (2) the violation is likely to result in substantial injury to the organization; and 2

9 (c) (d) (e) (3) the violation is related to a matter within the scope of the lawyers representation of the organization. Except where prior disclosure to persons outside the organization is required by law or other Rules, a lawyer shall first attempt to resolve a violation by taking measures within the organization. In determining the internal procedures, actions or measures that are reasonably necessary in order to comply with paragraphs (a) and (b), a lawyer shall give due consideration to the seriousness of the violation and its consequences, the scope and nature of the lawyers representation, the responsibility in the organization and the apparent motivation of the person involved, the policies of the organization concerning such matters, and any other relevant considerations. Such procedures, actions and measures may include, but are not limited to, the following: (1) asking reconsideration of the matter; (2) advising that a separate legal opinion on the matter be sought for presentation to appropriate authority in the organization; and (3) referring the matter to higher authority in the organization, including, if warranted by the seriousness of the matter, referral to the highest authority that can act in behalf of the organization as determined by applicable law. Upon a lawyers resignation or termination of the relationship in compliance with Rule 1.15, a lawyer is excused from further proceeding as required by paragraphs (a), (b) and (c), and any further obligations of the lawyer are determined by Rule In dealing with an organizations directors, officers, employees, members, shareholders or other constituents, a lawyer shall explain the identity of the client when it is apparent that the organization's interests are adverse to those of the constituents with whom the lawyer is dealing or when explanation appears r e a s o n a b l y n e c e s s a r y t o a void misunderstanding on their part. Official Comment: The official TDPRC comment to this rule states: The duty defined in this Rule applies to governmental organizations. However, when the client is a governmental organization, a different balance may be appropriate between maintaining confidentiality and assuring that the wrongful official act is prevented or rectified, for public business is involved. In addition, duties of lawyers employed by the government or lawyers in military service may be defined by statutes and regulations. Therefore, defining precisely the identity of the client and prescribing the resulting obligations of such lawyers may be more difficult in the government context. Although in some circumstances the client may be a specific agency, it is generally the government as a whole. For example, if the action or failure to act involves the head of a bureau, either the department of which the bureau is a part or the government as a whole may be the client for purpose of this Rule. Moreover, in a matter involving the conduct of government officials, a government lawyer may have authority to question such conduct more extensively than that of a lawyer for a private organization in similar circumstances. This Rule does not limit that authority. The official comment to the TDPRC is virtually similar to the comments that appear in the ABA Model Rules of Professional Conduct, Rule Comment: The phrase Although in some circumstances the client may be a specific agency, it is generally the government as a whole is probably too restrictive of a view. As has been pointed out, In one sense, the publicat-large is the client and not necessarily the elected or appointed officials or administrative personnel. Conflicts and Government Lawyers, Dewey Helmcamp, Advanced Administrative Law Course A person who works for an agency does not necessarily represent that agency. In Tex. Dept. of Mental Health and Mental Retardation v. Davis, 775 S.W.2d 467 (Tex.App. Austin 1989), MHMR tried to block release of an investigative report to the parents of a child who drowned at a state school. The investigative report was ordered by the agency s director of legal services and was conducted by non-lawyers. The irector of legal services admitted that this investigation was separate from and outside the investigations and reports conducted under agency rule. During litigation, MHMR claimed the attorney-client and work product privileges. The court concluded that those involved in preparing the report and communicating it to the director of legal services were not shown to be client representatives, entitled to be privy to confidential communication, with authority on behalf of the agency to obtain professional legal services or to act on any legal advice the attorney might render because it could not determine in what capacity the agency s employees 3

10 (who acted as investigators) acted and upon whose order they acted. Thus, without explicitly saying so the court found that in this case a different balance was appropriate between maintaining confidentiality and assuring that the wrongful official act is prevented or rectified - in this case the balance tilted toward rectification. E. TDPRC 2.10/Role of Attorney as Advisor to Client In advising or otherwise representing a client, a lawyer shall exercise independent professional judgment and render candid advice. F. TDPRC 4.02/Communication with One Represented by Counsel In representing a client, a lawyer shall not communicate or cause or encourage another to communicate about the subject of the representation with a person, organization or entity of government the lawyer knows to be represented by another lawyer regarding that subject, unless the lawyer has the consent of the other lawyer or is authorized by law to do so. G. TDPRC 5.03/Responsibilities Regarding Nonlawyer Assistants A lawyer having supervisory authority over a nonlawyer shall make reasonable efforts to ensure that the person s conduct is compatible with the lawyer s professional obligations and the lawyer is subject to discipline for the conduct of such a person that would be a violation of the rules if engaged in by a lawyer, if the lawyer orders, encourages, or permits the conduct involved. IV. ETHICAL STANDARDS APPLICABLE TO PROSECUTORS A. In General. The majority of government lawyers consider themselves to be practicing administrative law and do not get involved in criminal matters, but a great many of the statutes governing substantive matters include criminal provisions. For example it is a crime to: join or solicit another person to join a public school fraternity or sorority. Tex. Educ. Code ; uses an assistance animal with a leash commonly used by disabled persons to represent that their animal is a specially trained assistance animal when such training has not been provided. Tex. Hum. Res. Code fail to pay interest when refunding a utility deposit. Tex. Util. Code burn or bury animal remains within the corporate boundaries of a municipality (by a veterinarian). Tex. Occ. Code & These are minor offenses, of course, but many regulatory schemes contain criminal penalties for substantial breaches of health, safety and welfare laws. Hence, an examination of the ethical duties of criminal prosecutors is appropriate, especially when contemplating the government lawyer s role in agency investigations. B. TDPRC 3.09/special Responsibilities of Prosecutors The prosecutor in a criminal case shall: (a) (b) (c) (d) (e) refrain from prosecuting or threatening to prosecute a charge that the prosecutor knows is not supported by probable cause; refrain from conducting or assisting in a custodial interrogation of an accused unless the prosecutor has made reasonable efforts to be assured that the accused has been advised of any right to, and the procedure for obtaining, counsel and has been given reasonable opportunity to obtain counsel; not initiate or encourage efforts to obtain from an unrepresented accused a waiver of important pre-trial, trial or post-trial rights; make timely disclosure to the defense of all evidence or information known to the prosecutor that tends to negate the guilt of the accused or mitigates the offense, and, in connection with sentencing, disclose to the defense and to the tribunal all unprivileged mitigating information known to the prosecutor, except when the prosecutor is relieved of this responsibility by a protective order of the tribunal; and exercise reasonable care to prevent persons employed or controlled by the prosecutor in a criminal case from making an extrajudicial statement that the prosecutor would be prohibited from making under Rule Official Comment: Source and Scope of Obligations 1. A prosecutor has the responsibility to see that justice is done, and not simply to be an advocate. This responsibility carries with it a number of specific obligations. Among these is to see that no 4

11 person is threatened with or subjected to the rigors of a criminal prosecution without good cause. See paragraph (a). In addition a prosecutor should not initiate or exploit any violation of a suspects right to counsel, nor should he initiate or encourage efforts to obtain waivers of important pre-trial, trial, or post-trial rights from unrepresented persons. See paragraphs (b) and (c). In addition, a prosecutor is obliged to see that the defendant is accorded procedural justice, that the defendants guilt is decided upon the basis of sufficient evidence, and that any sentence imposed is based on all unprivileged information known to the prosecutor. See paragraph (d). Finally, a prosecutor is obliged by this rule to take reasonable measures to see that persons employed or controlled by him refrain from making extrajudicial statements that are prejudicial to the accused. See paragraph (e) and Rule See also Rule 3.03(a)(3), governing ex parte proceedings, among which grand jury proceedings are included. Applicable law may require other measures by the prosecutor and knowing disregard of those obligations or a systematic abuse of prosecutorial discretion could constitute a violation of Rule Paragraph (a) does not apply to situations where the prosecutor is using a grand jury to determine whether any crime has been committed, nor does it prevent a prosecutor from presenting a matter to a grand jury even though he has some doubt as to what charge, if any, the grand jury may decide is appropriate, as long as he believes that the grand jury could reasonably conclude that some charge is proper. A prosecutors obligations under that paragraph are satisfied by the return of a true bill by a grand jury, unless the prosecutor believes that material inculpatory information presented to the grand jury was false. 3. Paragraph (b) does not forbid the lawful questioning of any person who has knowingly, intelligently and voluntarily waived the rights to counsel and to silence, nor does it forbid such questioning of any unrepresented person who has not stated that he wishes to retain a lawyer and who is not entitled to appointed counsel. See also Rule Paragraph (c) does not apply to any person who has knowingly, intelligently and voluntarily waived the rights referred to therein in open court, nor does it apply to any person appearing pro se with the approval of the tribunal. Finally, that paragraph does not forbid a prosecutor from advising an unrepresented accused who has not stated he wishes to retain a lawyer and who is not entitled to appointed counsel and who has indicated in open court that he wishes to plead guilty to charges against him of his pre-trial, trial and post-trial rights, provided that the advice given is accurate; that it is undertaken with the knowledge and approval of the court; and that such a practice is not otherwise prohibited by law or applicable rules of practice or procedure. 5. The exception in paragraph (d) recognizes that a prosecutor may seek an appropriate protective order from the tribunal if disclosure of information to the defense could result in substantial harm to an individual or to the public interest. 6. Sub-paragraph (e) does not subject a prosecutor to discipline for failing to take measures to prevent investigators, law enforcement personnel or other persons assisting or associated with the prosecutor, but not in his employ or under his control, from making extrajudicial statements that the prosecutor would be prohibited from making under Rule To the extent feasible, however, the prosecutor should make reasonable efforts to discourage such persons from making statements of that kind. C. Problem Areas. A USA TODAY investigation documented 201 criminal cases in which federal judges found that federal prosecutors broke various ethical, procedural and evidentiary rules and cited them for prosecutorial misconduct since Articles which ran from September 2010 through March 2011 disclosed nine kinds of misconduct: improper remarks to the jury failure to disclose evidence that points to a defendant's innocence misrepresentation to the court improper attempts to influence witnesses improper release of information to the media improper impeachment breaching a plea agreement failure to comply with court orders and improper vouching These include a number of cases in Texas. See: projects.usatoday.com/news/2010/justice D. Connick v. Thompson. The US Supreme Court decided this prosecutorial misconduct case on March 29, (1) Facts. The Orleans Parish District Attorney s office prosecuted Thompson for attempted armed robbery. In doing so they violated Brady v. 5

12 Maryland, 373 U. S. 83, by failing to disclose a crime lab report. Because of the robbery conviction, he elected not to testify at his later murder trial and was convicted. A month before his scheduled execution, the lab report was discovered. Both convictions were vacated, and Thompson was found not guilty in a retrial on the murder charge. (2) Issues. Thompson filed suit against the DA under 42 U SC 1983, alleging, inter alia, that the Brady violation was caused by the DA s deliberate indifference to an obvious need to train prosecutors to avoid such constitutional violations. The district court held that, to prove deliberate indifference, Thompson did not need to show a pattern of similar Brady violations when he could demonstrate that the need for training was obvious. The jury found the DA s office liable for failure to train and awarded Thompson damages. The Fifth Circuit affirmed. (3) Holding. The Supreme Court held that failure to train prosecutors in their Brady obligations does not fall within the narrow range of single-incident liability, such as would be the case if a city armed its police force and deployed them into the public to capture fleeing felons without training the officers in the constitutional limitation on the use of deadly force, in which case the failure to train could reflect the city s deliberate indifference to the highly predictable consequence, namely, violations of constitutional rights. Thus the need for specific legal training was absent here. In other words, it is assumed that the prosecutors are familiar with the Brady rule, such that the making of an obviously wrong decision does not amount to a decision by the city itself to violate the Constitution by failing to provide specific training. (4) Reaction. Comment by the criminal defense bar has been harsh. As an example, Houston criminal lawyer John Floyd commented in his blog on 4/10/11: We believe Justice Thomas, and his conservative brethren, have given rogue prosecutors a virtual free pass to lie and cheat, even when they knowingly send innocent people to prison. These five justices have given constitutional blessing to the deplorable, shameful, and ever-increasing taint of prosecutorial misconduct in our legal system, and that is a judicial disgrace. The law, and its constitutional foundation, can be twisted and manipulated to achieve any objective, too often political ones. And that is precisely what we believe occurred in the Thompson case a decision by pro-prosecution justices designed to cover and insulate prosecutorial misconduct. V. A D M I N I S T R A T I V E A G E N C Y INVESTIGATIONS A. Introduction. Texas statutes and agency rules are replete with detailed policies and methods for the issuance of licenses and permits, and procedures for contested case hearings. Between the issuance of a license or permit and its revocation or discipline is a series of events called an investigation. Despite the popularity of detective stories, there is general misunderstanding about the investigative process. Most people, including lawyers and other professionals, tend to view investigations of all sorts as a slightly mysterious process. Investigations are not mysterious, but they are not necessarily easy, either. What is an investigation? Interestingly, Texas agency rules use that term only sparingly, nor do they specify what actions by an agency constitute an investigation. In this regard, agencies merely follow the example of law enforcement: Title 1, Chapter 2 of the Code of Criminal Procedure, setting forth the General Duties of Officers uses the word investigate only five times. Title 5, Chapter 19 of the Penal Code, dealing with Criminal Homicide does not use the word at all, nor does Chapter 20 (Kidnapping), Chapter 22 (Assaultive Offenses), Chapter 35 (Insurance Fraud) and Chapter 35A (Medicaid Fraud). The HHS Office of Inspector General rules have some of the most numerous references to investigative authority, but the actual methods of investigation are never specified. In the criminal law context the term "investigation" describes the overall process of determining whether sufficient evidence of a crime exists to warrant formal criminal charges. In the administrative law context one merely substitutes a few words: the process of determining whether sufficient evidence of the violation of a statute or rule exists to warrant formal action by the agency to revoke, suspend or discipline a license or permit (or some other sanction permitted by the applicable regulatory scheme). B. Initial Evaluation. The investigating agency must first consider each complaint or bit of information it receives to determine if an investigation should be pursued. Someone must ask: Who is complaining? Are they credible? Is the allegation coherent? If the allegation is true, has some law or rule been violated? If so, is the allegation capable of being either proven or disproven? 6

13 Most agencies send a notification letter to the affected licensee at this point, informing them that a complainant has been received, a short synopsis of the complaint, and inviting a response. Some agencies bifurcate the process, sending a letter about the complaint, and a separate letter regarding the initiation of an investigation. C. Gathering and Evaluating Data. Once a decision has been made to investigate, the investigator will order appropriate support documentation. This will vary depending on the agency involved, the nature of the complaint made. For example, in a case involving Medicaid overpayment, copies of claims, analyses of billing patterns and documents showing any history of problems with the provider will be obtained. This data will be evaluated to determine what sort of individual the licensee or permit holder is, and where a field investigation should concentrate. D. Field Work. This can take many forms, from interviewing persons with knowledge of the claimed infraction and gathering additional documentary evidence (by subpoena or otherwise). One or more visits to the licensee s place of business to conduct interviews and obtain additional evidence may be necessary. If a confrontation interview occurs, it must be carefully scripted to obtain the maximum amount of information in the shortest amount of time without being too intimidating. E. Report Preparation. Following the field investigation, the investigator prepare a report. This may seem to a merely bureaucratic requirement, but serves several functions. It may be a some time before legal action occurs. Memories of details will become hazy if not immediately recorded. The investigator may leave the employment of the investigative agency, and a new investigator may have to use the report. The report may be seen by a defense attorney if a case is filed, so it should be correct. F. Internal Review. Before an administrative sanction is imposed the report should undergo a review process. A supervisor should determine that all investigative steps have been followed, that the report itself makes sense, and that any need for further investigation is addressed before the report is finalized. Afterwards the report should be reviewed by an agency attorney. If a sanction is recommended, the attorney should scrutinize the report for legal sufficiency. This should not only protect the agency from charges of sloppy workmanship, but ensure that innocent licensees are not sanctioned due to erroneous interpretations of the law and/or insufficient evidence. G. Where Is the Agency Attorney During the Investigation? (1) Initial Evaluation. Legal expertise may, or may not, be needed to determine that some law or rule has been violated if the allegation is true. On the other hand, an agency cannot assume that its investigators are experts on the law itself, and there are unfortunately some investigators (like police officers) who assume that anyone who comes to their attention must be guilty of something because they only investigate guilty persons. And there are investigators who have their own agendas, consistently pursing certain types of cases - with or without success - based on their own inclinations. Another area in which agency counsel can be of value is determining jurisdictional issues. Agencies that issue licenses and permits have an interest in policing such licensees, but also serve a public function by prohibiting unlicensed persons from engage in conduct requiring a license. But this is not always as simple as it appears, and agency counsel can assist in determining whether the agency can assert jurisdiction over an unlicensed person, and in what way it might do so. In addition, if an agency has made a policy decision to regulate an existing area in a new way, or to extend its regulatory reach through new legal arguments, agency counsel should be prepared to be involved in investigations of this nature since resistance from the regulated community is likely. Agency counsel may also be called on to review the licensee s response when notified of the complaint/investigation to determine if further action is warranted. Having agency counsel pass on all such matters may be tedious, but services a quality control function, since an agency does not want to become identified as conducting pointless inquiries. (2) Gathering and Evaluating Data. If an investigator consistently gathers data that does not produce investigative leads, or proves worthless as evidence, agency counsel should be available to correct such tendencies before they happen. The 7

14 agency cannot assume that its investigators are experts in evidentiary law, and such laws change periodically, forcing agencies to either adjust or lost cases. (3) Field Work. Agency counsel generally do not accompany investigators during field investigations, but should be available to answer questions - and solve problems - from the field as they inevitably arise. Witnesses and licensees may refuse to be interviewed without having counsel present, and having agency counsel involved can be beneficial here. Investigators may discover entirely new avenues of inquiry while in the field, and the advice of counsel may be beneficial to help the investigator refocus their efforts. (4) Report Preparation. While this is usually the province of the investigator, maintaining an open flow of information during this phase can not only help the investigator write a report in such a way as to insure that action will be taken, but also keep agency counsel appraised of the workload. (5) Internal Review. In every case in which the initiation of an administrative sanction is recommended by an investigator, agency counsel should review the report to determine: (i) did the complaint allege some legal violation?, (ii) does the agency have jurisdiction over the issue or person?, (iii) was the violation capable of being proved?, (iv) did the investigator find evidence of a violation?, (v) is the evidence admissible?, (vi) does the licensee have an adequate explanation for the claimed violation that would exonerate him?, (vii) did the investigator discover something else that is as, or more, meritorious than the initial complaint, and has it been proven?, (viii) was the investigation conducted in accordance with agency policies?, (ix) what other work, if any, needs to be performed before a sanction is initiated?, (x) did the investigator identify the correct statutes and/or rules that he claims were violated?, and (xi) did the investigation produce evidence of a law violation that might be better resolved by another agency? Comment: In this regard, agencies might consider the same philosophical issue that prosecutors face: what is the correct standard for taking a case? Some metropolitan prosecutors take every complaint to Grand Jury and obtain an indictment, then let the trial courts determine which cases are meritorious by conducting many trials. In other words, any case that seems to have probable cause will get indicted and go to trial. On the other hand, prosecutors in some jurisdictions only recommend indictment if there is a strong likelihood that a case will produce a conviction. This is known as the trial standard for indictment. Often the determining factors are political: how much money does the jurisdiction want to spend on prosecutor salaries and expensive jury trials. Administrative agencies, like local governments, vary widely in their level of funding and hence willingness to pick fights. VI. TEXAS ETHICS OPINION NO. 499 A. Introduction. The Professional Ethics Committee of the Supreme Court of Texas has published few opinions specifically devoted to activities of government lawyers. Opinion 499 addresses the responsibilities of government lawyers in a contested case hearing. B. Facts. During a proceeding, the respondent's attorney argues that it proceeding was not commenced in accordance with law and requests the agency s attorney to provide a delegation of authority that shows that the proceeding was commenced by a representative with authority to do so. The agency refuses to do so but a supervising attorney directs the in-house attorney to represent to the respondent and ALJ that jurisdiction exists. Based on this the ALJ denies the motion to dismiss for want of jurisdiction and later issues a decision favorable to the agency. No delegation of authority had been issued and the supervising attorney knew it. Respondent's attorney later learns that a delegation of authority did not exist. An employee of the agency then issues a delegation of authority, retroactively effective for the preceding 5½ years. C. Questions. (1) Does an in-house attorney violate a Disciplinary Rule by representing to an opposing attorney and an ALJ that a factual basis for jurisdiction exists when he knows it does not? (2) Does a supervising attorney violate a Disciplinary Rule if he directs a subordinate attorney to represent to an opposing attorney and ALJ that a factual basis for jurisdiction exists when he knows it does not? (3) Does an in-house attorney violate a Disciplinary Rule by representing to an opposing attorney and an ALJ judge that a factual basis for jurisdiction exists unless he has a reasonable belief that jurisdiction does exist? 8

15 D. Conclusions. (1) Disciplinary Rules 3.01, 3.03 & 4.01 are violated if the in-house attorney knew no factual basis for jurisdiction existed at the time he represented that it did o the opposing attorney and ALJ that jurisdiction existed. (2) DR 3.01 would be violated if the in-house attorney did not have a reasonable basis for believing that jurisdiction existed when he represented that it did. (3) Rule 5.01 would be violated if the supervising attorney ordered, encouraged, or knowingly permitted the in-house attorney to make false statements to the opposing attorney or ALJ or if he failed to take reasonable remedial action to avoid or mitigate the consequences of the in-house lawyer's violation. (4) Rule 1.02 would be violated if the in-house lawyer failed to take reasonable efforts to persuade his client (the government agency) to take corrective action if he reasonably believed at the time he made them that his statements to the opposing attorney and ALJ were true but later learned that they were not true. Comment: This result should not be surprising to anyone, as it is a case of (a) the agency acting without clear jurisdiction, (b) the supervising attorney directing his staff attorney to lie about it, (c) the staff attorney lying to opposing counsel and the ALJ, and (d) the staff attorney failing to take corrective action once he knew that a lie was communicated. While interesting, Opinion 499 concerns the actions and inactions of agency lawyers at a stage of a proceeding which has become docketed as a contested case hearing before an ALJ. What are the ethical responsibilities of agency lawyers at a purely investigative stage? VII. TEXAS ETHICS OPINION NO. 600 A. Introduction. The Professional Ethics Committee of the Supreme Court of Texas has published one opinion -Opinion 600- addressing the conduct of government lawyers in the investigative phase of a case involving a licensee. B. Facts. A Texas governmental agency that issues licenses is comprised of a legal and an enforcement division. The legal division represents the agency in obtaining enforcement orders but does not have supervisory authority or control over the enforcement division. The enforcement division is staffed by non-lawyers who investigate complaints. The legal division is not involved in investigation until cases are referred for disciplinary action. After a disciplinary order is entered, the case is referred back to the enforcement division for monitoring. In most cases, regulated persons (who investigated or subject to monitoring for compliance) are represented by legal counsel. Lawyers for regulated persons often request that the agency s enforcement division personnel ( investigators ) communicate with regulated person only through designated counsel. C. Question. Under the TDRPC, is a governmental attorney required to ensure that the agency's enforcement officers do not communicate directly with a regulated person who is represented by an attorney except with such lawyer s consent? D. Discussion. TDRPC 4.02(a) prohibits an attorney from directly communicating about legal a matter with a person known to be represented by counsel unless their attorney consents or the communication is otherwise authorized by law. Rule 4.02(a) also prohibits the government attorney from indirectly effecting such communications by causing a non-lawyer to communicate with the represented person. The Professional Ethics Committee cites Comment 2 to Rule 4.02 to the effect that the rule does not impose a duty on a lawyer to affirmatively discourage communication between the lawyer s client and other represented persons, organizations or entities of government. Thus, since the agency lawyer s client is the agency itself, if the lawyer has no supervisory authority over investigators and does not cause or encourage communications represented persons by investigators, the TDPRC imposes no restrictions on the lawyer regarding communications by investigators with represented persons. Furthermore, the TDPRC does not require that an agency lawyer comply with a request from a regulated person s lawyer that all communications by enforcement personnel with the regulated person be carried out through the [regulated person s] lawyer. The Professional Ethics Committee states that a different analysis would apply if the agency lawyer had direct supervisory authority over the agency investigators. In that event, Rule 5.03 would make the lawyer responsible for the actions of the employees supervised by the lawyer. Under Rule 5.03(b), the lawyer would be in violation of the TDPRC if the lawyer ordered, encouraged or permitted employees under the lawyer s direct supervision to communicate with 9

16 represented persons contrary to the requirements of Rule 4.02(a). E. Conclusion. A governmental attorney is not required to limit communications by the agency's enforcement officers who are not subject to the lawyer s direct supervisory authority with regulated persons represented by counsel. But a governmental attorney is not permitted to communicate directly with a regulated person represented counsel who has not consented to the communications and is not permitted to cause or encourage such communications by other agency employees. Finally, the governmental attorney is obligated to prevent such communications by agency employees over whom they have direct supervisory authority. Comment: Opinion 600 appears to say that, as long as an agency lawyer isolates himself from the activities of agency investigators, the conduct of investigators in communicating directly with regulated persons who are represented by counsel, and who have indicated to the agency that the investigators should communicate directly through counsel, is not imputed to the agency lawyer as a violation of TDPRC 4.02(a). Does this conclusion flow from the fact which the Professional Ethics Committee assumes that [i]n some cases, lawyers for regulated persons have formally requested that the agency s enforcement division personnel communicate with a regulated person only through the particular regulated person s lawyer? In other words, does the agency lawyer avoid responsibility if the regulated person s counsel only communicates their desire to limit communications to retained counsel to the investigator and not the agency lawyer? Or is this conclusion attributable to an unstated deference on the part of the Professional Ethics Committee to the effect that a government agency may communicate directly with its licensees at all time regardless of their representation status (Comment 2 to Rule 4.02 states...that paragraph does not impose a duty on a lawyer to affirmatively discourage communication between the lawyers client and other represented persons, organizations or entities of government.). If so, is a mere phrase in a Comment to a TDPRC, -perhaps somewhat out of context - sufficient to reach such conclusion? VIII. SCENARIOS IMPLICATING OPINION NO. 600 A. Hypothetical. The Texas Widget Commission regulates the manufacture and distribution of widgets. TWC receives a complaint and initiates an investigation concerning a widget licensee, and informs the licensee of said investigation. The licensee s counsel responds to the notice of investigation, denies all allegations, and requests that all further communication be conducted through counsel, and sends a copy to the client/licensee. When the licensee does not respond, the investigator issues an administrative subpoena for the evidence requested in the letter. Believing that his lawyer has been notified, the licensee waits for his lawyer to contact him before responding to the subpoena. The investigator call the licensee and threatens him for non-response to the subpoena. The licensee s lawyer returns from trial to find urgent calls from the licensee regarding the subpoena. He calls the agency s general counsel regarding the subpoena and an accommodation is reached on that matter. A letter regarding the terms of that accommodation is sent to the general counsel. Thereafter, the TWC investigator obtains information that may indicate additional violations of the applicable law and sends the licensee a second letter stating that the scope of the investigation has been expanded, and requests an explanation and relevant documents. This letter is not sent to the licensee s attorney. Thinking that the expanded investigation is unreasonable, and believing that his lawyer has been notified, the licensee waits for his lawyer to contact him before replying to the investigator. In the meantime, the licensee s lawyer is in trial out of state and knows nothing about the second TWC letter. Eventually the TWC investigation is concluded with a tentative finding that the underlying law has been violated. TWC and the licensee have an informal conference, and an order is proposed finding a violation and imposing disciplinary action. The order rejected and the matter is docketed at SOAH. The licensee s lawyer files an answer. At some time prior to the SOAH hearing, the licensee s lawyer schedules a vacation out of the country, and sends a notice of unavailability to SOAH and the agency lawyer. On the day the licensee s lawyer board the overseas flight, the TWC investigator appears at the licensee s place of business with an administrative subpoena seeking documents that pertain both to the contested SOAH case and an as yet unspecified matter. B. Questions. (1) If the licensee s lawyer had sent his initial notice of representation to the agency s general counsel, would that imputed knowledge of the investigation to an agency lawyer and thus taken the 10

17 investigator s subsequent communications with the licensee out of the scope of Opinion 600? (2) Did the licensee, by virtue of retaining a lawyer and asking the lawyer to represent him in front of TWC, have a right to rely upon his lawyer s letter of representation to the agency? Or does a person, but virtue of obtaining a license or permit from a state agency, waive such rights? (3) Does Opinion 600 conflict with Opinion 492? In that opinion, a city attorney was allowed to prohibit an attorney representing a municipal employee in a grievance arising out of municipal employment from communicating with, or causing another to communicate with, any city employee who has "managerial responsibility which relates to the subject of the representation" based on TDPRC In other words, if the city attorney, who is the legal advisor for all city officers and departments, can effectively keep a municipal employee from investigating a grievance through retained counsel, why cannot the TWC licensee s lawyer prohibit communication with his client as well? (4) Does Opinion 600 conflict with Opinion 117? In that opinion the question was whether or not it would violate the Canons of Ethics for attorneys representing a plaintiff, after suit is filed but before answer is filed, to obtain a written statement (secured in the presence of a reporter) from the defendant? It was held that such conduct would violate former Canon 9 if the defendant were represented by counsel, and also that it would be unethical to take a statement from the defendant without (1) inquiring whether he had retained counsel, and (2) giving defendant a reasonable opportunity to employ counsel. (See also Opinion 342). (5) When the TWC investigator issued the administrative subpoena, did that impute knowledge of the investigation to an agency lawyer as regards further communications if an agency lawyer either issued the subpoena or was consulted by the investigator about its drafting and/or issuance? (6) When the licensee s lawyer contacts the agency s general counsel regarding the subpoena and they reach an accommodation reflected in a letter, did that impute knowledge of the investigation to the general counsel as regards further communications? (7) When the licensee s lawyer filed an answer at SOAH, and sent a Notice of Unavailability to SOAH and the general counsel, did that make the investigator s actions of issuing a subpoena during the period of unavailability improper? Does the answer change if the subpoena was issued for matters that are entirely unrelated to the SOAH case? Does the answer change if the purported authority for the subpoena was in the TWC statute and not in SOAH rules? Note: the views expressed herein, and any podium remarks, are the author s own and do not represent those of any court, agency, or the Professional Ethics Committee of Texas Supreme Court. 11

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19 QUESTION PRESENTED Appendix THE PROFESSIONAL ETHICS COMMITTEE FOR THE STATE BAR OF TEXAS Opinion No August 2010 Under the Texas Disciplinary Rules of Professional Conduct, is a lawyer for a Texas governmental agency required to ensure that the agency's enforcement officers do not communicate directly with a regulated person who is represented by a lawyer except with such lawyer s consent? STATEMENT OF FACTS A Texas governmental agency issues licenses to qualified persons to engage in a specific business. The agency is comprised of a legal division and an enforcement division. The legal division represents the agency in obtaining enforcement orders but does not have supervisory authority or control over the enforcement division. The enforcement division of the agency, which is staffed by licensed officers who are not lawyers, investigates complaints against persons regulated by the agency and monitors such persons' compliance with orders previously issued for violations of the agency's regulations. Lawyers in the agency s legal division are not involved in the investigation of violations until the matter is referred to the legal division for the possible issuance of a disciplinary order. After a disciplinary order is issued against a regulated person, the enforcement division, without further involvement of the legal division, is charged with monitoring the regulated person's compliance with the requirements of the order, which may continue for up to five years. In most cases, regulated persons that are investigated by the agency s enforcement division or are subject to monitoring for compliance with a disciplinary order are represented by legal counsel with respect to the agency s regulation. In some cases, lawyers for regulated persons have formally requested that the agency s enforcement division personnel communicate with a regulated person only through the particular regulated person s lawyer. DISCUSSION Rule 4.02(a) of the Texas Disciplinary Rules of Professional Conduct provides as follows: (a) In representing a client, a lawyer shall not communicate or cause or encourage another to communicate about the subject of the representation with a person, organization or entity of government the lawyer knows to be represented by another lawyer regarding that subject, unless the lawyer has the consent of the other lawyer or is authorized by law to do so." Rule 4.02(a) thus prohibits a lawyer from communicating directly concerning a matter with a person known to be represented by a lawyer with respect to that matter unless the person s lawyer consents or the communication is otherwise authorized by law. In addition to generally prohibiting direct communications by a lawyer with a represented person except with the consent of the lawyer for the represented person, Rule 4.02(a) also prohibits the lawyer from indirectly effecting such communications by causing or encouraging a non-lawyer to communicate with the represented person in such circumstances. As noted in Comment 1 to Rule 4.02, Rule 4.02(a) prohibits communications that are in form between a lawyer s client and another person represented by counsel where, because of the lawyer s involvement in devising and controlling their content, such communications are in substance between the lawyer and the represented person. However, as noted in Comment 2 to Rule 4.02, Rule 4.02(a) does not prohibit communications between a lawyer s client and persons represented by counsel as long as the lawyer does not cause or encourage the communication without the consent of the lawyer for the other party. This Comment further recognizes that Rule 4.02(a) does not impose a duty on a lawyer to affirmatively discourage communication between the lawyer s client and other represented persons, organizations or 13

20 entities of government. In this case, the lawyer s client is the governmental agency. It is assumed for purposes of this opinion that there is no other legal authorization for the communications in question if consent of a regulated person s lawyer for direct communications with the regulated person would otherwise be required by Rule 4.02(a). However, provided that the agency s lawyer does not have direct supervisory authority over the enforcement personnel of the agency and does not cause or encourage communications by such personnel with represented persons, neither Rule 4.02(a) nor any other provision of the Texas Disciplinary Rules of Professional Conduct imposes restrictions on the lawyer with respect to communications by enforcement personnel with represented persons. There is likewise no requirement under the Texas Disciplinary Rules of Professional Conduct that a lawyer for the agency comply with a request from a regulated person s lawyer that all communications by enforcement personnel with the regulated person be carried out through the lawyer. A different analysis would apply if the agency lawyer had direct supervisory authority over enforcement personnel of the agency. In that event, Rule 5.03 would make the lawyer responsible for the actions of the employees supervised by the lawyer. Under Rule 5.03(b), the lawyer would be in violation of the Texas Disciplinary Rules of Professional Conduct if the lawyer ordered, encouraged or permitted employees under the lawyer s direct supervision to communicate with represented persons contrary to the requirements of Rule 4.02(a). CONCLUSION Under the Texas Disciplinary Rules of Professional Conduct, a lawyer for a Texas governmental agency is not required to limit communications by the agency's enforcement officers who are not subject to the lawyer s direct supervisory authority with regulated persons who are represented by lawyers. However, a lawyer for a governmental agency is not permitted to communicate directly with a regulated person that is represented in the matter by a lawyer who has not consented to the communications and is not permitted to cause or encourage such communications by other agency employees, and the agency lawyer is obligated to prevent such communications by employees over whom the lawyer has direct supervisory authority. 14