Exception or Violation?

Exception or Violation?

Rule 7.3(e) fits in a single sentence, and that sentence doubles as your checklist. It opens with the words "Notwithstanding the prohibitions in this Rule" and then permits a lawyer to participate with a prepaid or group legal service plan operated by an organization not owned or directed by the lawyer that uses live person-to-person contact to enroll members or sell subscriptions for the plan from persons who are not known to need legal services in a particular matter covered by the plan.¹ An exception lifts a ban, so the analysis starts with the ban. Rule 7.3(a) forbids in-person, live telephone, or real-time electronic solicitation when a significant motive is the lawyer's pecuniary gain, a prohibition that remains nearly absolute.² Only a contact the ban reaches needs the exception, and for that contact three questions decide the matter: who operates the plan, whom it calls, and what it sells. The conditions are cumulative. If any one fails, the override disappears and the contact returns to the baseline rule.

Steps two through four come straight from the text of the exception. Step five comes from the lawyer's duties toward the plan, covered in the preceding sections. A plan call can pass the first four steps and still leave the lawyer in violation at the fifth, so an answer that stops once the three conditions are met is incomplete.

The failing version begins with the same kind of telephone call and breaks all three conditions at once.

Scenes at opposite extremes teach less than scenes that sit close to the manufacturer's plan, because an examiner usually breaks just one condition and leaves the rest looking harmless.

Each plan fails exactly one condition. The first fails the operator condition: the lawyer directs the organization, so the callers are in substance the lawyer's own sales force. The second fails the audience condition: the plan picked each person after learning of a covered matter, so the contact is not with persons who are not known to need services in a covered matter, and the exception does not shield it.³ The third fails the purpose condition: the exception reaches live contact to enroll members or sell subscriptions for the plan, and a pitch that sells one lawyer's services is not that.⁴ Who places the call does not decide any of these questions. In every case the other two conditions are satisfied, and that does not matter, because the override is lost as soon as one condition fails.

Students lose points here by stopping early. An independent sponsor settles only the second step of five, and a nonlawyer caller settles none of them, yet either fact tempts a hurried reader to call the whole question. A student who confirms all three conditions may still forget that the exception speaks only to the plan's live contacts. What the lawyer pays the plan and how closely the lawyer watches its conduct are answered by separate rules.