Last year, the U.S. Supreme Court decision in North Carolina Board of Dental Examiners v. Federal Trade Commission established that professional organizations may not use their authority as regulators to stifle market competition. Throughout the year, the State Bar of California (SBC) has refused to recognize that this ruling applies to it. This refusal leaves consumers of legal services with no effective avenue to reform regulations that harm them, and could subject the SBC to antitrust suits.
In its 2016 session, the California Legislature attempted to address these shortcomings when considering the SBC's annual authorization to collect dues from its members. The Assembly version of the dues bill, supported by Responsive Law, would have required that the SBC be governed by a non-lawyer majority board, but the Senate refused to accept this condition and the Legislature adjourned without passing a dues bill.
The SBC then asked the California Supreme Court to authorize it to collect dues without legislative approval. The California Supreme Court acquiesced to this demand, despite a brief from Responsive Law asking it to impose public oversight of the SBC's anticompetitive actions as a condition of its authorization.
"The California Supreme Court's decision is an unfortunate defeat for consumers of legal services, who need a judicial system more responsive and accountable to the public interest," stated Responsive Law Executive Director Tom Gordon. "In California and across the nation, state bars need to adapt their practices both to serve the public and to conform with the U.S. Supreme Court's standards for professional regulatory organizations."