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Supreme Court considers State Bar spending at rule hearing (UPDATE)

By: Jack Zemlicka, [email protected]//April 11, 2011//

Supreme Court considers State Bar spending at rule hearing (UPDATE)

By: Jack Zemlicka, [email protected]//April 11, 2011//

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Steve Levine
Steve Levine

The Wisconsin Supreme Court declined to narrow its own rule Monday to specifically require the State Bar of Wisconsin provide clear and convincing evidence when attorneys challenge the use of mandatory dues.

At its open administrative conference on Monday, the justices could not come to an agreement as to how, or whether it should impose any burden of proof on the bar, a change sought by Madison attorney Steve Levine and others in a petition to the court.

Some on the court suggested that the bar’s by-laws already put the onus on the organization to prove, in the event of a dispute, that mandatory dues are used for one of two federally constitutional purposes: activities that either regulate the legal profession or improve the quality of legal services.

“The State Bar has the burden of proof, according to their by-laws,” said Justice Patience Roggensack. “So to try and figure out what it is, give it a label and put it in our Supreme Court rules is fraught with problems.”

The court voted, 5-2, in favor of tabling that portion of the petition, pending any changes to the bar’s by-laws.

But Chief Justice Shirley Abrahamson was in favor of bringing the issue back to the court, regardless of any by-law revisions.

“I don’t think court can clarify everything today,” she said. “But, I would have it clarified in the rule that the burden is on the state bar.”

Earlier in the day, during an administrative rules hearing, Levine argued that when challenged, the bar should provide proof, rather than theory, when spending mandatory dues, that the activities either regulate the legal profession or improve the quality of legal services.

He told the court that in light of a recent ruling by the Seventh Circuit Court of Appeals – which ruled in favor of the bar in a lawsuit challenging the association’s use of dues to fund a public image campaign – the bar should be a held to a higher standard to justify the use of member dues.

Levine was one of the litigants in the case, which concerned whether certain bar dues should be eligible for a rebate each year, and he subsequently petitioned the court to amend Supreme Court Rule 10.03.

“The rule should lay out specifically what burden of proof the State Bar has to meet in arbitration proceedings to show expenses were directly, primarily or substantially related to regulating the profession or improving the quality of legal services,” Levine said Monday.

But speaking for the State Bar, attorney Roberta Howell said organization by-laws already place a burden of proof on the bar to justify expenses.

When questioned by the court whether the bar needs any evidence to justify expenditures, Howell, of Foley & Lardner LLP, said “as counsel for the bar, I can’t imagine not having evidence as to why the bar undertook a particular activity.”

The expenses in question stemmed from the bar’s Public Image Campaign that was unveiled in 2002 and consisted of television commercials highlighting lawyers performing community projects and pro bono work.

In 2007, the bar spent $97,886 of mandatory dues on the campaign, or about $5.16 per member. Levine unsuccessfully challenged the expenses as nothing more than self-promotion by the bar.

He filed suit in state court, but the case was later moved to federal court where a judge affirmed the ruling of the arbitrator. Last September, the Seventh Circuit also affirmed, holding that the U.S. Constitution only required the bar to provide a rational basis for the charge.

Levine argued Monday that the appellate court ruling gives too much latitude to the bar to determine what constitutes a chargeable expense, evidenced by a drop in the attorney rebate amount of $9 before the September decision, to $5 this year.

He also said that absent a requirement to provide specific proof, nobody will ever challenge an expense again before an arbitrator.

“If the bar is so low that the Bar only has to suggest a logical theory for the expenses, nobody will ever use the arbitration process,” Levine said. “There will be litigation instead.”

Justice Ann Walsh Bradley also questioned whether there would be an incentive for dues challengers to object under the Seventh Circuit ruling.

Jack Zemlicka can be reached at [email protected]

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