What must my firm do after discovering that a partner who recently joined lied about his degrees and law license?
Texas Ethics Opinion 522: Disclosure Duties After a Partner's False Credentials
Short answer: The Committee concluded the firm must take reasonable remedial action: end the relationship with the unlicensed person, send corrected resumes and inform everyone who received the false information, and, if the person is licensed elsewhere, report the conduct to the appropriate disciplinary authorities.
Disclaimer: This is an advisory ethics opinion. Advisory opinions are not binding; they interpret the Texas Disciplinary Rules of Professional Conduct and are persuasive authority. This summary is for research purposes only and is not legal advice. Verify current rules before acting on any specific guidance.
About this page: The plain-English summary and Q&A below were written by Ezel based on the official opinion. The opinion text is reproduced at the bottom; the official source (linked) controls.
Plain-English summary
A law firm discovered that a partner who had recently joined had given false information about his background to the firm, its lawyers, clients, and potential clients. He claimed a law degree he had not earned, claimed MBA and LL.M. degrees he had not earned, and claimed licenses in jurisdictions where he was not licensed; the firm had assumed he was licensed in Texas, but he was not (he had since applied for Texas admission). Based on his data, the firm had sent resumes containing the false information to clients, potential clients, and its lender, and had sponsored his applications for admission elsewhere using the false information. On discovering the misrepresentations, the firm decided the partner would leave.
The Committee concluded that although the person who supplied the false information was not himself governed by the disciplinary rules (he was neither a lawyer nor a bar member), duties fell on the firm and its lawyer members once they knew or should have known of the false information. The firm should immediately terminate the relationship, because continuing it would assist a non-bar member in activities constituting the unauthorized practice of law in violation of Rule 5.05. The firm's inadvertent communication of the false information also implicated Rules 7.01 (misleading firm name) and 7.02(a)(1) (false or misleading communications about qualifications or services). The Committee stressed the firm's original dissemination was inadvertent, but continuing the association or the dissemination after discovery would violate those rules.
On remedies, the Committee concluded that, although no rule specifies the exact remedial action for false information received from a non-lawyer other than a client, the firm's duty was the same as on learning a lawyer violated the rules: under Rule 5.01(b), take reasonable remedial action. At a minimum, the firm should send out new resumes and inform all recipients of the false or inaccurate information; failing to do so would violate Rule 8.04's bar on dishonesty, fraud, deceit, or misrepresentation. If the person is in fact licensed in other state or federal courts, the firm must report the conduct under Rule 8.03 to the appropriate authorities, which here would include the Board of Law Examiners, admissions committees, and the Unauthorized Practice of Law Committee of Texas and other states. On whether the firm must disclose the false statements in its loan application to its lender, the Committee expressed no opinion, noting that question raised matters outside its scope, including possible civil liability and, in some circumstances, criminal violations.
Currency note
This opinion was issued in 1997, under the Texas Disciplinary Rules of Professional Conduct that took effect January 1, 1990. Texas did not adopt the ABA's Ethics 2000 revisions; its rules have been amended only piecemeal since (including the March 1, 2005 amendment to the fee rule, Rule 1.04, and the comprehensive 2021 revisions adopted by Texas Supreme Court order). The firm-name and advertising rules in Part VII were among the rules later revised. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.
Common questions
Q: A new partner turned out to have faked his credentials and isn't even licensed. What must the firm do?
A: The Committee concluded the firm must immediately end the relationship, because keeping the unlicensed person on would assist the unauthorized practice of law under Rule 5.05, and must take reasonable remedial action under Rule 5.01(b).
Q: Must the firm correct the resumes it already sent out?
A: The opinion concluded yes. At a minimum the firm should send new resumes and inform everyone who received the prior ones of the false or inaccurate information; not fully informing affected clients and others would violate Rule 8.04(a)(3)'s bar on dishonesty and misrepresentation.
Q: Does the firm have to report the person to any authorities?
A: The Committee concluded that if the person is in fact licensed in other state or federal courts, the firm must report the conduct under Rule 8.03 to the appropriate disciplinary authorities, which here would include the Board of Law Examiners, admissions committees, and the Unauthorized Practice of Law Committee in Texas and other states he applied to.
Q: Did the opinion say whether the firm must tell its lender?
A: No. The Committee expressly declined to opine on disclosure to the firm's lender, noting that question raised matters outside its scope, including possible civil liability and, in some circumstances, criminal violations.
Background and rules framework
The opinion interprets Rule 5.05 (unauthorized practice of law; ABA Model Rule 5.5), Rules 7.01 and 7.02(a)(1) (firm names and false or misleading communications; Model Rule 7.1), Rule 5.01(b) (responsibilities of partners; Model Rule 5.1), Rule 8.04 (misconduct; Model Rule 8.4), and Rule 8.03 (reporting professional misconduct; Model Rule 8.3). It references Rule 4.01 (truthfulness in statements to others; Model Rule 4.1) regarding disclosures when representing a client, while treating the situation as governed by the firm's general remedial duties.
Citations and references
Rules of Professional Conduct:
- MR 4.1 (truthfulness in statements to others)
- MR 5.1 (responsibilities of partners and supervisory lawyers)
- MR 5.5 (unauthorized practice of law)
- MR 7.1 (communications concerning a lawyer's services)
- MR 8.3 (reporting professional misconduct)
- MR 8.4 (misconduct)
- Texas Disciplinary Rules 4.01, 5.01(b), 5.05, 7.01, 7.02(a)(1), 8.03, 8.04(a)(3)
See also
- TX Ethics Op. 523: An Associate's Duty on Discovering a Colleague's Negligent Advice
- TX Ethics Op. 529: Trade Names and Firm Names Implying a Quality
- TX Ethics Op. 632: Reporting Another Lawyer's Prohibited Trade Name
Source
- Landing page: https://www.legalethicstexas.com/resources/opinions/opinion-522/
- Original PDF: https://tcle-web.s3.amazonaws.com/public/documents/Opinion_522.pdf
Original opinion text
Reproduced from the official source for research purposes. The linked source is authoritative. The source text encoded curly quotation marks and apostrophes with unreadable characters, and dropped a leading letter from one question; these have been restored.
QUESTION PRESENTED
What disclosures must a law firm make after learning that a partner who recently joined the law firm provided false information regarding his qualifications?
STATEMENT OF FACTS
A law firm has discovered that one of its partners who recently joined the firm provided false information to the firm, its lawyers, clients, and potential clients about his background. Specifically, the partner claimed to be a graduate of a law school from which he did not graduate. He claimed to have degrees (MBA and LL.M.) which he has not earned. He also claimed to be licensed in several jurisdictions in which he is not licensed. Although the firm assumed the partner to be licensed in Texas, he is not. He has, since joining the firm, applied for admission to the State Bar of Texas.
Based on data provided by the partner, the firm sent resumes to clients, potential clients, and its lender which included the false information. Additionally, the partner, with the firm's approval and sponsorship, has sought admission to practice in one or more jurisdictions where the false information has been included in the applications for admission.
As a result of the firm's discovery of the misrepresentations, it has been decided that the partner will leave the firm.
DISCUSSION
Is the law firm obligated to disclose the falsity of such information to all clients and potential clients who received the resumes?
The person who provided the false information to the law firm is not regulated by the Texas Disciplinary Rules of Professional Conduct since he is neither a lawyer nor a member of the bar. However, once the law firm becomes aware, or should have become aware of the false information, certain duties, obligations, and responsibilities fall upon the law firm and the lawyer members thereof pursuant to the Texas Disciplinary Rules of Professional Conduct. First, the law firm should immediately terminate the relationship between the law firm and the person providing the false information since continuing the relationship would be assisting a person who is not a member of the bar in the performance of activities that constitute the unauthorized practice of law. As such, the continued relationship would be a violation of Rule 5.05.
Furthermore, in inadvertently communicating the false information to clients, the general public, and others, the law firm should come under the scrutiny of Rules 7.01 and 7.02. Although it may have been inadvertent, the law firm used a name that was misleading as to the identity of lawyer or lawyers practicing under such name in violation of Rule 7.01. Additionally, in sending out the resumes, the law firm, again inadvertently, made false or misleading communications about the qualifications or services of the law firm by sending out resumes which contain material misrepresentations of fact. See Rule 7.02(a)(1).
The committee has been careful to point out that the conduct of the law firm in disseminating the false information was inadvertent. To continue the association or the dissemination of the information after discovering the false information, however, would be a violation of the above rules. There is no directive in the Texas Disciplinary Rules of Professional Conduct as to precisely what remedial action the law firm should take once it discovers the false information received from a non-lawyer, other than a client. See Rule 4.01 as to necessary disclosures with regard to false statements made in the course of representing a client. However, it is the opinion of the committee that as to the facts presented in this case, the duty upon the law firm and the lawyer members thereof would be the same as that imposed on them upon learning that a lawyer violated these rules.
Rule 5.01(b) states in part: "A lawyer shall be subject to discipline because of another lawyer's violation of these rules of professional conduct if the lawyer is a partner in the law firm ... and with knowledge of the other lawyer's violation of these rules knowingly fails to take reasonable remedial action to avoid or mitigate the consequences of the other lawyer's violation."
In this case, as in the case of learning of a lawyer's violation of the rules, the law firm should take "reasonable remedial action." At a minimum, in the present case, the law firm should send out new resumes and inform all who received the resumes of the false or inaccurate information which the previous resume may have contained. To not fully inform clients, potential clients, and others affected thereby of the falseness of this information would be a violation of Rule 8.04, which prohibits a lawyer from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation. See Rule 8.04(a)(3).
Is the firm obligated to notify the State Bar of Texas or state and federal courts where the lawyer is currently licensed of the false statements? If the person who provided the false information is in fact "licensed" in other state or federal courts, it is incumbent upon the law firm to report such conduct to the appropriate disciplinary authorities. Rule 8.03 requires in part that "a lawyer having knowledge that another lawyer has committed a violation of applicable rules of professional conduct that raises a substantial question as to that lawyer's honesty, trustworthiness, or fitness as a lawyer in other respects, shall inform the appropriate disciplinary authorities." In this particular case, other appropriate authorities would include the Board of Law Examiners, Admissions Committee, and the Unauthorized Practice of Law Committee of Texas and other states to which he may have applied for admission.
Is the firm obligated to disclose to the firm's lender that false statements have apparently been made, inadvertently, by the law firm in the loan application to the lending institution based on representations of the lawyer which were believed to be true by the firm at the time the loan application was made? Other than stating that the law firm should be guided by the "reasonable remedial action" standard discussed above, the committee expresses no opinion on this question as it raises questions outside its scope which may include possible civil liability and, in some circumstances, state and/or federal criminal violations.
Tex. Comm. On Professional Ethics, Op. 522 (1997)