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As Texas Supreme Court law clerks near the end of their one-year stint at the court, the state’s ethics commission is trying to determine whether the young lawyers can accept bonuses from firms that will be their future employers. Acting at the request of Texas Supreme Court Chief Justice Tom Phillips, Lynne Liberato, immediate past president of the State Bar of Texas, asked the commission in a June 8 letter for an ethics advisory opinion addressing the bonus issue. Liberato, who says she made the request as an individual attorney and not on behalf of the Bar or her firm, emphasizes the need for the issue to be clarified. “It’s important because the court needs to be able to select the highest-quality new lawyers that it can,” says Liberato, a partner in Haynes and Boone in Houston. Phillips says state courts have to compete with the federal courts, which do not have a prohibition against clerks accepting bonuses after they leave courts to work for firms. Some firms pay signing bonuses as high as $35,000. If the ethics commission issues a written opinion stating that the bonuses don’t violate a penal code provision barring gifts to public servants, the clerks and firms would be protected against prosecution, Phillips says. Section 571.097 of the Texas government code provides a defense to prosecution or the imposition of civil penalties if a person “reasonably relied” on a written advisory opinion of the ethics commission relating to the provision of the law that he is accused of violating or a similar situation. “I know it is a protection against prosecution,” Phillips says. Travis County, Texas, Attorney Ken Oden, who first questioned the legality of the bonuses last summer, says he needs to analyze whether an ethics opinion could settle the criminal code question. “Present law does not allow for private payments to public servants,” Oden says. If the ethics commission’s opinion conflicts with the wording that bans the private payments, is that controlling over the penal code provision? he asks. Oden says the prohibition against private payments to public servants with a judicial function is broader than for others. It’s not enough that the court’s attorney be barred from participating in a particular case that comes before the court and involves the person or entity who makes the payment to the attorney. The attorney can’t take the money if the firm is likely to have a case before the court, he says. One question that needs to be addressed, Oden says, is whether a clerk would be protected from prosecution if he relies on an ethics commission opinion that says the bonuses are legal but previously was given notice by a prosecutor that such payments aren’t legal. UNANSWERED QUESTION? Phillips says the supreme court asked the legislature to address the bonus issue, but lawmakers refused to provide an answer. “Our first preference is for the legislature to tell us what they meant rather than having the ethics commission divine what the meaning of the statute is,” he says. A state lawmaker says the legislature gave the supreme court an answer, but that some justices didn’t like the answer they got. Democratic Rep. Jim Dunnam sponsored a bill that dealt with the issue by placing restrictions on when state court clerks could accept jobs with firms. But unlike a bill passed by the senate, Dunnam’s version did not repeal the penal code provision that Oden says outlaws the bonuses. “That was one thing non-negotiable in the house. We did not want to see the penal code provision changed,” says Dunnam, a partner in Dunnam & Dunnam in Waco, Texas. The legislature passed Dunnam’s bill, but Gov. Rick Perry vetoed it on June 17. Although Oden had encouraged lawmakers to pass a bill addressing the clerk bonus issue, he says Dunnam’s bill needed to be vetoed because it imposed recusal requirements that would make it difficult for clerks at all state courts to handle cases for the firms that hire them. A clerk would have been recused for two years from handling any case in which the firm was involved while the clerk worked at the court, he says. “When I looked at the bill, the first thing I thought of was what [the "Saturday Night Live" character] Roseanne Roseannadanna would say when she picked something out of her teeth. You look at it and you don’t know what it is,” Oden says. The two sides may not have long to wait for an answer from the ethics commission. Sarah Woelk, director of the commission’s advisory opinions division, says the agency meets next on Aug. 10 and she sees no reason why Liberato’s opinion request wouldn’t be on the agenda for that meeting. Phillips says it would be helpful if the commission addresses the issue on Aug. 10 because the clerks employed by the supreme court will leave in mid-August. Oden says if the commission agrees with him that the payments are illegal, he would prosecute clerks who accept the bonuses and firms that pay them in the future. In the meantime, spokesmen for three Texas firms — Vinson & Elkins, Baker Botts and Thompson & Knight — say they have suspended bonuses for future employees currently working at the supreme court until the issue is resolved. Notes James Reeder, hiring partner at V&E in Houston: “We are still in suspense.”

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