Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC Staff Advises Tennessee Supreme Court on Attorney Advertising, (Jan 25, 2013)

By Tobias J. Gillett, J.D., LLM.

In response to a request from the Tennessee Supreme Court, the FTC staff has submitted a letter, commenting on proposed amendments to Tennessee’s Rule of Professional Conduct regarding lawyer advertising and suggesting principles the Court should consider in reviewing the proposals (FTC File No. V130001).

The staff stressed that the Court should ensure that the amendments did not “unnecessarily restrict the dissemination of truthful and non-misleading information, thereby limiting information available to consumers.”

In support of this proposition, the letter noted that some of the proposed amendments, such as bans on using generally recognizable spokespersons or actors to play clients, did “not on their face target deception.” The FTC staff recommended that more narrowly-tailored rules could reduce the risk of misleading the public “without unduly restricting the free flow of information.” Similarly, it suggested that a blanket prohibition on advertising claims that were “unsubstantiated in fact” could include “useful, non-deceptive” claims that would be hard to verify, such as ones “about the quality or dedication of the lawyer,” and that a narrower rule could suffice.

The FTC staff also took a dim view of a requirement that advertisements would have to be pre-screened and evaluated by a review committee of the Board of Professional Responsibility, noting that this would permit those attorneys to restrict the advertising of their competitors. It suggested that the Court limit itself to sanctioning violations. If it chose to proceed with a review process despite this recommendation, the Court should consider the state and federal antitrust laws that would apply.

Likewise, the FTC staff observed that a ban on advertising by attorneys “without a bona fide office in the state” could eliminate competition from attorneys licensed to practice in Tennessee but without an office in the state, as well as attorneys representing Tennessee residents in broader class action lawsuits. The letter noted that the Tennessee Rules of Professional Conduct did not contain a residency requirement for licensed attorneys, and “urge[d] the Court to consider whether prohibiting otherwise permissible advertising by attorneys without a bona fide office in Tennessee is necessary to protect the public.”

The Commission voted 5-0 to approve the staff comment. The letter was sent on January 24, 2013.

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