Attorney Ethics: An Update from the 85th Legislative Session

ETHICS PRESENTATION
Presented by:
Ty Embrey and Troupe Brewer
TWCA MID-YEAR CONFERENCE
JUNE 16, 2017

HB 53 (ROMERO)
 A governmental unit may not enter into a
settlement of a claim or action against the
governmental unit in which:
 the settlement amount is equal to or greater than
$30,000;
 the money used to pay the settlement is:
 tax money collected by the entity
 received from the state, or
 insurance proceeds from a policy paid for by either of the
proceeding sources, and;
 the settlement agreement itself contains a non-
disclosure clause.

 “Governmental unit” defined broadly under
Section 101.001 of the Texas Civil Practices and
Remedies Code.
 Any agreement entered into that violates this
language is void and unenforceable.
 Changes apply only to claims or actions that
accrue on or after the effective date, September
1, 2017.
HB 53 (ROMERO) CONTINUED

HB 776 (ASHBY)
 Amends Section 572.032(a-1) of the Government Code
to require the Texas Ethics Commission to remove
individuals' home addresses from personal financial
statements filed under the Subchapter before releasing
the financial statements to the public.
 This section was previously limited only to the addresses
of "judges or justices."
 Requirement to file personal financial statement applies
to a state officer, a partisan or independent candidate
for an office as an elected officer, and a state party chair

HB 1701 (PARKER)
 This bill requires that a written copy of the investment policy of a
governmental entity be provided to any “business organization”
offering to engage in an investment transaction.
 The bill also amends the written instrument requirement whereby
the “business organization” acknowledges it will only make
investments as authorized by the investing entity’s investment policy.
 The bill adds exception in a case where the authorization relates to
investment transactions of the entity that are not made through
accounts or other contractual arrangements over which the business
organization has accepted discretionary investment authority.

HB 3047 (DALE)
 This bill amends the TX Open Meetings Act to require a
member of a governmental body who participates in a
meeting by videoconference to be considered absent
from any portion of the meeting during which audio or
video communications with the member is lost or
disconnected.
 The governmental body may continue the meeting only if
a quorum of the body remains present at the meeting
location or if the presiding member is physically present
at a location open to the public during the meeting and a
quorum is available via video conference.

HB 3107 (ASHBY)
 This bill amends the TPIA to establish that a public
information request is considered withdrawn if:
 the requestor fails to inspect or duplicate the information in
the offices of the governmental body on or before the 60th
day after the information is made available, or
 fails to pay charges or before the 60th day after the date the
requestor is informed of charges.
 The bill also establishes, with exceptions, that all
requests received on the same calendar day from one
individual may be treated as a single request for the
purpose of calculating costs.

 In addition, the bill allows governmental entities to establish
“monthly” and “yearly” limits on the amount of time that its
personnel are required to spend producing or copying public
information pursuant to a request without recovering its costs.
 Yearly time limits may not be less than 36 hours per year, and a
monthly time limit may not be less than 15 hours in any one-month
period.
 The bill also provides that a governmental entity is not required
to locate, compile, produce, or provide copies of documents or
prepare a cost statement in response to a new request until
the date the requestor pays any unpaid invoices for
previous requests.
HB 3107 (ASHBY) CONTINUED

HYPOTHETICAL – GCD / BOARD
MEMBER PARTICIPATION
 Clearwater Underground Water Conservation District
 Texas Attorney General Opinion – GA0334 (2005)
 Section 171.004 of Texas Local Gov. Code –
Substantial Interest in Bus. Entity or Real Property
 Section 551.071(1)(A) of Texas Open Meetings Act
– Further Participation

Does a GCD Board Member who is a General
Manager of a Water Supply Corporation have a
substantial interest in a business entity with a
matter before the GCD Board if the WSC he/she
works for has submitted a groundwater
production permit application to the GCD?

 Section 171.002 of Texas Local Gov. Code - SUBSTANTIAL INTEREST IN
BUSINESS ENTITY. (a) For purposes of this chapter, a person has a
substantial interest in a business entity if:
 (1) the person owns 10 percent or more of the voting stock or shares of the
business entity or owns either 10 percent or more or $15,000 or more of the
fair market value of the business entity; or
 (2) funds received by the person from the business entity exceed 10
percent of the person's gross income for the previous year.
 (b) A person has a substantial interest in real property if the interest is an
equitable or legal ownership with a fair market value of $2,500 or more.
 (c) A local public official is considered to have a substantial interest under
this section if a person related to the official in the first degree by
consanguinity or affinity, as determined under Chapter 573, Government
Code, has a substantial interest under this section.

Can a GCD Board Member / WSC General
Manager threaten litigation and then participate
in an executive session called by the GCD Board
to discuss the WSC’s groundwater production
permit application?

 Section 171.004 (a) - AFFIDAVIT AND ABSTENTION FROM VOTING
REQUIRED. (a) If a local public official has a substantial interest in
a business entity or in real property, the official shall file, before a
vote or decision on any matter involving the business entity or the
real property, an affidavit stating the nature and extent of the
interest and shall abstain from further participation in the matter
if:
 (1) in the case of a substantial interest in a business entity the action
on the matter will have a special economic effect on the business
entity that is distinguishable from the effect on the public; or
 (2) in the case of a substantial interest in real property, it is
reasonably foreseeable that an action on the matter will have a
special economic effect on the value of the property, distinguishable
from its effect on the public.

Is a contested permit application before a
political subdivision, such as a GCD,
considered pending or contemplated
litigation?

 Section 551.071(a) - CONSULTATION WITH ATTORNEY;
CLOSED MEETING. A governmental body may not
conduct a private consultation with its attorney except:
 (1) when the governmental body seeks the advice of
its attorney about:
 (A) pending or contemplated litigation; or
 (B) a settlement offer; or

SB 79 (NELSON)
 Amends Subsections 552.221(b-1) and (b-2) of
the Public Information Act (referral to website) by
replacing the phrase “political subdivision of this
state” with “governmental body.”
 Authorizes “governmental bodies” other than
“political subdivisions” to comply with a public
information request in the same way that political
subdivisions are authorized to comply.

SB 255 (ZAFFIRINI)
 Texas Comptroller indicated that current law does not allow the
use of certain best practices in procurement training.
 Purpose of SB 255 is to address this issue and improve the training
requirements for governmental entities and vendors.
 Bill requires purchasing and contract management training
programs to be developed by the Comptroller to meet the need of
Texas’ state agencies.
 Agencies may also opt to create their own agency-specific training
programs in consultation with the Comptroller
 Reporting requirement for agencies to detail which/how many
employees are receiving training, the costs of such training, and all
certifications received (if agency spends over $5,000 on
training/CE).

 Bill transfers several sections of the Govt Code related to training and
continuing education programs for agency personnel into Chapter 656
 Specific training programs on purchasing of information resources technologies
 Training curriculum expanded to include instruction on, i.e.: negotiation methods; writing
specifications; the criteria for determining which product or service offers the best value
for the state; developing evaluation criteria; formal and informal bidding methods and
complex negotiations.
 “Contract managers” now have certification requirement to go with training
 Increased training requirements for contract managers to include training on
how to: maintain required documentation for contracting decisions, changes to
a contract, and problems with a contract; create a risk evaluation and mitigation
strategy; create a plan for potential problems with the contract; develop an
accurate and comprehensive statement of work;
and complete the contract and evaluate performance
under the contract.
SB 255 (ZAFFIRINI) CONTINUED

 Bill also expands the exemptions to the
“disclosure of interested party” requirements in
the government code (added during 84R) to
include:
 A contract with a publicly traded business entity,
including a wholly owned subsidiary of the business
entity or a contract with an electric or gas utility, as
those terms are defined by the Utilities Code
 The bill also provides a model form for the
disclosure of interested parties document.
SB 255 (ZAFFIRINI) CONTINUED

SB 302 (WATSON)
 Date of next Sunset review is 2029.
 Training for Board members amended to include training on scope
of rulemaking authority and administrative procedure
requirements.
 A fee increase of any kind for state bar members may not take
effect unless a majority of members voted in approval.
 However, the Board may approve of a membership fee increase without
member vote, not more than once every 6 years, and not by more than 10%.
 Commission for Lawyer Discipline’s annual report to the Board, TX
Supreme Court, and legislature must now provide data by race
and gender and include detailed information on grievances related
to barratry.

 Chief disciplinary counsel, upon approval, may now issue a
subpoena in the investigation into a grievance. Shall provide
a process for a respondent to object to subpoena.
 Chief disciplinary counsel shall create procedure for an
attorney to self-report any criminal offense and any
disciplinary action taken by another state’s bar.
 Sanction guidelines to be adopted by Texas Supreme Court.
 Grievance tracking system to be created. Report of
information gathered in grievance tracking system to be
periodically posted online.
SB 302 (WATSON) CONTINUED

 Committee on Disciplinary Rules and Referenda created, consisting of
attorneys and non-attorney public members appointed by the President
of the State Bar and the TX Supreme Court. Committee shall:
 Regularly review TDRPC and TRDP;
 issue annual report of review to the Board and supreme court; and
 oversee the initial process for proposing a disciplinary rule. Procedures for
proposed disciplinary rules outlined in detail, including referendum vote by
members.
 Ombudsman for attorney discipline system created, selected by and
reporting directly to Texas Supreme Court.
 State Bar now entitled to obtain criminal history record information on
members, and shall obtain criminal history records on
each member by Sept. 1, 2018.

BACKGROUND – DISCIPLINE
ISSUES FOR TEXAS ATTORNEYS
 The behavior of attorneys in Texas is governed by the
Texas Disciplinary Rules of Professional Conduct
(TDRPC) which was adopted in 1990.
 The TDRPC replaced the Texas Code of Professional
Conduct.
 Generally, the TDRPC are similar to the Model Rules
promulgated by the American Bar Association.

BACKGROUND – DISCIPLINE
ISSUES FOR TEXAS ATTORNEYS
 Texas Supreme Court created the Texas Professional
Ethics Committee which issues non-binding advisory
opinions.
 While the advisory opinions based on the TDRPC are
non-binding, the opinions are very persuasive and
courts give a considerable amount of deference to the
opinions.

REQUEST AN OPINION FROM TEXAS
PROFESSIONAL ETHICS COMM.
 BEFORE YOU REQUEST AN OPINION:
 Check to see if an ethics opinion has already been published regarding your subject. The Texas
Center for Legal Ethics maintains a searchable database of ethics opinions and rules
at www.legalethicstexas.com.
 TO REQUEST AN OPINION FROM THE PEC:
1. Prepare a written request that includes:
1. A scenario of background facts in the hypothetical situation;
2. The question(s) presented;
3. A discussion of applicable authority. This may not need to be exhaustive, but should focus on
specific disciplinary rules that may be involved and any case law, prior opinions or opinions from
other jurisdictions that may apply; and
4. A statement that the question(s) presented is/are not pending before a court of this state.
2. Send your request to the following address, and we will forward it to the PEC:
Ellen Pitluk, Attorney Liaison
State Bar of Texas
Office of the Chief Disciplinary Counsel
Post Office Box 12487
Austin, Texas 78711

HYPOTHETICAL – ATTORNEY
GRIEVANCES / ETHICAL COMPLAINTS
How can I check to see if an attorney has
any grievances or ethical complaints
against him or her?

HYPOTHETICAL – ATTORNEY
GRIEVANCES / ETHICAL COMPLAINTS
 Anyone can check on the status of a lawyer in the state
of Texas, by going to the State Bar of Texas web site,
www.texasbar.com and use “Find A Lawyer” feature by
typing in the lawyer’s name. It will list the public
disciplinary activity for that lawyer.
 A person can also contact the Office of the Chief
Disciplinary Counsel for the State Bar of Texas at 800-
932-1900.

SB 303 (WATSON)
 Life of Board/Next date for Sunset review
extended until 2029
 Provides for delegation of “routine decisions”
to the Executive Director
 Training requirements for appointees to the
Board reworded/clarified
 Bill also requires the ED of the Board to create a
training manual to address the information that is
part of the required training program and provide
that to Board members

 Supreme Court shall ensure any rules adopted regarding the
eligibility to take the bar exam do not violate the Religious
Freedom laws in the Texas CPRC.
 To assist the Board in making “consistent and fair” licensing
decisions, the bill requires Board to develop specific
guidelines for:
 (1) determining the moral character and fitness of applicants;
 (2) overseeing probationary license holders, and;
 (3) granting waiver requests

SB 347 (WATSON)
 Requires that Regional Water Planning Groups,
and any committee or subcommittee of a
RWPG, be subject to the Open Meetings Act
and the Public Information Act.

SB 532 (NELSON)
 Makes confidential under TPIA “information
directly arising from a governmental body’s
routine efforts to prevent, detect, investigate,
or mitigate a computer security incident,
including information contained in or derived
from an information security log.”
 Major change – creation of “Information
Technology Infrastructure Report” requirement

 Texas Department of Information Resources shall
collect from each “state agency” information on the
status and condition of the agency ’s information
technology infrastructure, including information
regarding:
1) The agency ’s information security program;
2) An inventory of the agency ’s servers, mainframes, cloud services,
and other information technology equipment;
3) Identification of vendors that operate and manage the agency ’s
information technology infrastructure; and
4) Any additional related information requested
by the department.
SB 532 (NELSON) CONTINUED

 “State agency” defined as a department,
commission, board, office, council, authority, or
other agency in the executive or judicial branch of
state government that is created by the
constitution or a statute of this state.
 State agencies required to provide this information
pursuant to a schedule to be determined by the
Department

 Not later than November 15 every even-numbered year,
Department must issue a report to the Legislature that
must:
1) Include an analysis and assessment of each state agency’s security
and operational risks; and
2) For a state agency found to be at higher security and operational
risks, include a detailed analysis of, and an estimate of the costs to
implement, the:
 Requirements for the agency to address the risks and related
vulnerabilities; and
 Agency ’s efforts to address the risks through the:
i. Modernization of information technology systems;
ii. Use of cloud services; and
iii. Use of a statewide technology center established by
the department

 The report is considered public information under the TPIA, subject to
other exceptions for specific information contained in the report
 When making purchases for a major information resources project, bill
makes mandatory consideration of cloud computing service options,
including any security benefits and cost savings associated with
purchasing those service options from a cloud computing service
provider and from a statewide technology center established by the
department
 Department of Information Resources must also submit a report subject
to the same deadline above that addresses the use of cloud computing
service options by state agencies, focusing on cases that provided cost
savings and other benefits, including security enhancements.
 State agencies must assist the Department in providing
information for this report.

SB 564 (CAMPBELL)
 This bill amends Section 551.089 of the Texas
Open Meetings Act to expand exemption to
now apply to all “governmental bodies” when
meeting to deliberate:
 Security assessments or deployments relating to
information resources technology;
 Network security information as described by
Section 2059.055(b); or
 The deployment, or specific occasions for
implementation, of security personnel, critical
infrastructure, or security devices.

HYPOTHETICAL – SUCCESSIVE
GOVERNMENT AND PRIVATE EMPLOYMENT
Can a former state agency or political
subdivision in-house attorney represent a
private client before the state agency or
political subdivision?

 TDRPC Section 1.10 - (a) Except as law may otherwise expressly
permit, a lawyer shall not represent a private client in connection
with a matter in which the lawyer participated personally and
substantially as a public officer or employee, unless the appropriate
government agency consents after consultation.
 (b) No lawyer in a firm with which a lawyer subject to paragraph (a)
is associated may knowingly undertake or continue representation
in such a matter unless:
 (1) The lawyer subject to paragraph (a) is screened from any participation in the
matter and is apportioned no part of the fee therefrom; and
 (2) written notice is given with reasonable promptness to the appropriate
government agency.
HYPOTHETICAL – SUCCESSIVE
GOVERNMENT AND PRIVATE EMPLOYMENT

SB 625 (KOLKHORST)
 Bill creates the “Special Purpose District Public
Information Database” for which the Comptroller shall
assemble and make available certain information on
special purpose districts
 Under the bill, "Special purpose district" means a
political subdivision of this state with geographic
boundaries that define the subdivision’s territorial
jurisdiction.
 The term does not include a municipality, county, junior
college district, independent school district, or political
subdivision with statewide jurisdiction

 Applicable to all special purpose districts that
 are authorized by the state by a general or special law to
impose an ad valorem tax or a sales and use tax, to
impose an assessment, or to charge a fee; and
 during the most recent fiscal year:
 had bonds outstanding;
 had gross receipts from operations, loans, taxes, or
contributions in excess of $250,000; or
 had cash and temporary investments in excess of $250,000.
SB 625 (KOLKHORST) CONTINUED

 Database will include:
1) The name of the special purpose district;
2) The name of each board member of the special purpose district;
3) Contact information for the main office of the special purpose
district, including the physical address, the mailing address, and
the main telephone number;
4) Name of the general manager or executive director or name of
employee that performs comparable duties or functions;
5) Contact information for a person representing a utility operator,
including a mailing address and a telephone number, if district
contracts with a utility operator;

6) If the special purpose district contracts with a tax assessor-collector,
contact information for a person representing the tax assessor-
collector, including a mailing address and telephone number
7) The special purpose district’s Internet website, if applicable;
8) The information the special purpose district is required to report
under Section 140.008(b) or (g), Local Government Code (annual
financial reports);
9) The total amount of bonds authorized by the voters of the special
purpose district that are payable wholly or partly from ad valorem
taxes, excluding refunding bonds if refunding bonds were separately
authorized and excluding contract revenue bonds;

10) The aggregate initial principal amount of all bonds issued by the
special purpose district that are payable wholly or partly from ad
valorem taxes, excluding refunding bonds and contract revenue
bonds;
11) The rate of any sales and use tax the special purpose district
imposes; and
12) For a special purpose district that imposes an ad valorem tax:
A. The ad valorem tax rate for the most recent tax year if the district is a
district as defined by Section 49.001, Water Code; or
B. The table of ad valorem tax rates for the most recent tax year
described by Section 26.16, Tax Code, in the form
required by that section, if the district is not a
district as defined by Section 49.001, Water Code.

SB 1440 (CAMPBELL)
 This bill amends the definition of "meeting"
under the TOMA
 Excludes from TOMA requirements the
attendance by a quorum of a governmental
body at a candidate forum, appearance, or
debate to inform the electorate if no formal
action is taken and discussion of public
business is incidental to the event.

Ty Embrey
tembrey@lglawfirm.com
512-322-5829
Questions? Lloyd Gosselink
Rochelle &
Townsend, P.C.
816 Congress Ave.
Suite 1900
Austin, Texas 78701
512-322-5800
www.lglawfirm.com
Troupe Brewer
tbrewer@lglawfirm.com
512-322-5858

Attorney Ethics: An Update from the 85th Legislative Session

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Attorney Ethics: An Update from the 85th Legislative Session