“Bring out yer dead.” Monty Python and the Holy Grail
An interesting recent order is tucked away on the Supreme Court’s miscellaneous orders web page. State ex rel. Indiana Supreme Court Disciplinary Commission v. Core, No. 94S00-0910-MS-492 (March 12, 2010). It approved a settlement between the Disciplinary Commission and a respondent in an unauthorized practice of law matter.
Indiana General Counsel
The respondent was Vice President of Risk Management for a major Indianapolis-based corporation. The agreed facts recited that the respondent also used the title of General Counsel in e-mail and regular correspondence and otherwise held himself out as the corporation’s general counsel. It was further stipulated that the respondent has never been admitted to practice law in Indiana. Notwithstanding the respondent’s lack of an Indiana law license, the parties agreed that the respondent’s employer was “aware that Respondent is not licensed to practice law in Indiana.”
The respondent formerly practiced law in Iowa for almost twenty years, but since1993, his Iowa law license has been suspended for failing to pay annual registration fees and comply with mandatory continuing legal education requirements.
The parties stipulated to and the Supreme Court accepted an agreement for a permanent injunction providing that the respondent is enjoined “from holding himself out as ‘Counsel,’ ‘General Counsel,’ or any other title suggesting his status as an attorney licensed in Indiana to provide legal advice and legal services, and from providing legal advice or legal service to any person or entity in Indiana, unless and until such time as she obtains a license to practice law in Indiana.” While the facts of this case involved a lawyer who held himself out publicly as general counsel, there is no reason to believe that the same result would not follow in the case of a lawyer who confined her law practice to providing internal legal advice to an entity.
The fundamental concept behind this decision is that to render legal services in Indiana, one must be licensed to do so or otherwise be authorized by law. Perhaps this seems a little strange in the case of in-house corporate counsel, but it shouldn’t. The general counsel of a corporation is simply a lawyer employed to serve a single client. If the corporate entity and the lawyer are both present in Indiana, foreign-licensed, general counsel is engaged in the unauthorized practice of law every bit as much as the foreign lawyer who comes into Indiana without authority to provide legal services to natural persons. It is not a defense that the client acquiesced in the lawyer’s unlicensed status.
Authorized Practice of Law
In the absence of a regular Indiana law license, there are numerous legal grounds for the authorized practice of law in Indiana by foreign-licensed lawyers, including temporary law practice under Indiana’s multi-jurisdictional practice of law rule. Indiana Rule of Professional Conduct 5.5(c). Federal law often provides a basis for foreign-licensed lawyers (and some lay people—Social Security administrative appeals, for example) to engage in exclusively federal-law based practice, like immigration or patent law, on Indiana soil. Likewise, foreign lawyers are eligible to practice in Indiana temporarily in particular cases by the authority of the pro hac vice rule. Indiana Admission and Discipline Rule 3(b). I have written before about the importance of and process for obtaining proper temporary admission under that rule. Migratory Lawyers and Other Exotic Species, Vol. 49, No. 10 Res Gestae 27 (June 2006).
Until quite recently, in-house counsel who were employed in Indiana by corporations or other business entities had no choice but to become regularly licensed in Indiana by taking the bar exam or, if eligible, admitted initially on a provisional basis after having practiced elsewhere on a foreign law license for the requisite period of time—sometimes called admission on motion or on a foreign license. For the current version of the provisional license rule, see Indiana Admission and Discipline Rule 6(1).
In practice, there was a third option resorted to by corporate counsel who didn’t want to go to the trouble of getting licensed in Indiana—simply ignore licensing requirements, hunker down inside the walls of a corporate headquarters and give advice to the corporate client without having an Indiana law license. It was difficult to know the extent of this world of underground law practice because the work of in-house counsel is often invisible to outsiders, including bar regulators.
A Rule of One’s Own
Effective January 1, 2004, the Supreme Court created a new law license category designed to meet the needs of foreign-licensed in-house counsel not eligible for regular foreign-license admission. Indiana Admission and Discipline Rule 6(2). Called a “business counsel license,” it allows Indiana-resident lawyers who are employed exclusively to serve the interests of a single business entity to obtain a law license that limits them to serving the legal interests of that one client. The requirements for obtaining a business counsel license are that the employment must entail at least 1000 hours per year of practice for the business entity, the lawyer must be a member in good standing of all other bars to which she is admitted and satisfy Indiana’s character and fitness requirement, and the lawyer’s admission must be in the public interest. Further, the applicant must not have failed the Indiana bar exam within the previous five years.
There is an $800 application fee. Admis. Disc. R. 6(3).
Once admitted, a business counsel licensee must renew that license by November 1 of each year and on an annual basis thereafter. Admis. Disc. R. 6(4)(b) and (e). What this means is that the date for the first renewal will almost inevitably be less (and sometimes far less) than 365 days from the date of admission. This requirement essentially involves re-affirming that the conditions for admission were satisfied during the previous year and continue to be met.
Special Continuing Legal Education Requirements
Within twelve months of initial admission, business counsel licensees must show to the satisfaction of the Board of Law Examiners that they have completed “an annual Indiana law update seminar, which seminar shall provide a minimum of 12 hours of continuing legal education which has been approved by the Indiana Commission for Continuing Legal Education.” Admis. Disc. R. 5(a). At this writing, two courses have been approved to meet this requirement: the Indiana Law Update seminar sponsored by ICLEF that usually takes place in September of each year, and the Indiana Year-in-Review seminar also sponsored by ICLEF that usually takes place in December of each year.
The update seminar requirement is in addition to the annual CLE requirements that apply to all Indiana lawyers, with the notable exception that business counsel licensees do not have an initial grace period upon admission to start accumulating annual CLE credit hours. In fact, the annual CLE hour requirement begins on the January 1 immediately preceding admission. Admis. Disc. R. 29(3)(c). This means, of course, that a late-year admission will leave very little time to obtain the minimum of six annual CLE hours for that calendar year. While not apparent from the text of the rules, newly admitted business counsel licensees are not required to satisfy the Applied Professionalism Program for Newly Admitted Attorneys referred to in Admis. Disc. R. 29(3)(c).
Paying the Piper
Annual renewal also requires paying a fee of $50 by November 1 of each year, with late charges accruing for not making timely payment, in addition to the annual registration fee required of all Indiana-licensed lawyers under Admission and Discipline Rule 2. Admis. Disc. R. 6(4)(c). The Board of Law Examiners will send out annual reminders of the annual fee and certification requirements on or before September 1 of each year. Although not clearly stated in the rule, one suspects that, as with regular annual registration fees, the notice is a courtesy and non-receipt does not forgive non-compliance with rule-based obligations and will not be a basis for waiving late fees that accrue from lack of timely annual fee payment.
Detailed information about business counsel licenses and application forms are available on the Board of Law Examiner’s website at: http://www.in.gov/judiciary/ble/2331.htm.
Failing to keep up the obligations associated with a business counsel license will result in revocation of that license and “sanctions for contempt of this Court in the event he or she thereafter engages in the practice of law in this State.” Admis. Disc. R. 6(4)(d). Continued practice in Indiana under a business counsel license hinges on maintaining employment in Indiana by a business entity. There is a 3-month grace period for obtaining new business counsel employment if a business counsel licensee loses qualifying employment. Admis. Disc. R. 6(2). A business counsel licensee who is no longer eligible to maintain that license may (and should) relinquish that license. Admis. Disc. R. 6(4)(f). Failure to do this will result in revocation and that may create an impediment to being approved for licensure under some other category in the future.
A Pathway to Full Licensure
In some cases, a business counsel license can be a gateway to full Indiana bar admission by applying for admission on foreign license. I will not go into the detailed requirements for provisional admission on a foreign license here. They are set out in detail at Admis. Disc. R. 6(1). But a couple of comments are in order. First, practice in Indiana under a business counsel license “may apply toward years of practice for a maximum of five (5) years so long as the applicant meets all of the requirements of [provisional license admission] and the application for provisional license admission is made within seven (7) years of the grant of the initial business counsel license.”
Second, a foreign lawyer who is not a graduate of an ABA-accredited law school is eligible for business counsel licensure, but is not eligible to be admitted on a foreign license. Once admitted on a foreign license (whether on the basis of years of business counsel practice or otherwise), after four years of compliant provisional practice, admission becomes permanent in the fifth year. Admis. Disc. R. 6(4)(a). In fact, many in-house counsel (those with a sufficient number of qualifying practice years) may be eligible for immediate admission on a foreign law license and will have no need to go through the interim step of being licensed as business counsel.
Coming Out of the Woodwork
The big unknown for current Indiana in-house lawyers who have no Indiana license when one is required is whether it is safe to come out into the open and obtain business counsel licenses at this time. There has been no formal safe-harbor announced to allow this on a risk-free basis. Doing so would have been safer in 2005. Keep in mind my earlier mention that the application process includes a review for character and fitness. Because the scope of the character and fitness inquiry is so broad, it is not possible to say with certainty that years of Indiana law practice without any form of Indiana law license will be viewed as a character and fitness concern.
One thing seems clear in light of the recent Core decision: ignoring obligations imposed by the Indiana Supreme Court is no longer a tenable position. The longer one waits after the creation of the business counsel license, the harder it is to make a convincing case for why one didn’t come forward earlier. Among the factors it might be prudent to highlight in making application are (as applicable): that representation of the client has been strictly internal and did not involve communications with courts, governmental agencies or third parties as the employer’s legal representative; that one has maintained any other law licenses and remains in good standing in those jurisdictions; and that one’s employer has been aware of the fact that the applicant does not have an Indiana law license and has not demanded Indiana licensure. If home state law licenses have been administratively suspended, they should be returned to good standing before seeking a business counsel license. The bottom line is that further delay can only hurt, not help.
The Core case focuses attention on a little known category for Indiana bar admission. It also highlights the importance of in-house counsel attending to proper licensure if they are engaged in the practice of law in Indiana and have no other law-based authority for their practice here. Outside counsel for corporations and in-house counsel alike should use this as an occasion to review corporate legal staff compliance with Indiana rules.