Amended in Senate August 31, 2016

Amended in Senate August 19, 2016

Amended in Assembly June 2, 2016

Amended in Assembly May 27, 2016

Amended in Assembly April 18, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2878


Introduced by Committee on Judiciary (Assembly Members Mark Stone (Chair), Alejo, Chau, Chiu, Cristina Garcia, and Holden)

February 25, 2016


An act to amend Sections 6001,begin delete 6001.1,end deletebegin insert 6008.6,end insert 6011, 6013.1, 6013.3, 6013.5, 6015, 6016, 6019, 6021, 6022, 6026.7, 6029, 6030, 6060.2, 6060.25, 6086.5, 6140, and 6145 of, to add Sections 6134 and 6140.56 to, to add and repeal Section 6075.6 of, and to repeal Sections 6008.5, 6009.7, 6012, 6013.2, 6018, and 6026.5 of, the Business and Professions Code, relating to the State Bar.

LEGISLATIVE COUNSEL’S DIGEST

AB 2878, as amended, Committee on Judiciary. Attorneys: State Bar: board of trustees.

The State Bar Act provides for the licensure and regulation of attorneys by the State Bar of California, a public corporation governed by a board of trustees. That act requires 6 members of the 19-member board to be attorneys elected from State Bar Districts. That act requires protection of the public to be the highest priority for the State Bar and the board of trustees in exercising their licensing, regulatory, and disciplinary functions and requires protection of the public to be paramount whenever the protection of the public is inconsistent with any other interest sought to be promoted. That act provides that the State Bar is subject to the Bagley-Keene Open Meeting Act and the California Public Records Act, as specified. That act, until January 1, 2017, requires the board to charge an annual membership fee for active members of up to $315 for 2016. The act requires the board of trustees to elect or select the president, vice president, and treasurer of the State Bar, as specified. Existing law prohibits the Legislature, when the board of trustees places a charge upon or otherwise makes available all or any portion of the income or revenue from membership fees for the payment of security of an obligation of the State Bar and so long as any obligation remains unpaid, from reducing the maximum membership fee below the maximum in effect at the time the obligation is created or incurred and provides that this provision constitutes a covenant to the holder of such an obligation. The act requires the board of trustees to contract with the California State Auditor’s Office to conduct a performance audit of the State Bar’s operations, as specified. That act establishes the State Bar Court to act in the place of the board of trustees in the determination of disciplinary proceedings, as specified. That act requires the board to appoint a lawyer admitted to practice in California to serve as chief trial counsel, as specified. That act authorizes the State Bar to raise additional revenue by any lawful means, including, but not limited to, the creation of foundations or not-for-profit corporations. That act requires the board to establish and administer a Client Security Fund to relieve or mitigate pecuniary losses caused by dishonest conduct of active members of the State Bar, as specified.

This bill would provide that the board of trustees consist of no more than 19 members and no fewer than 13 members and would require the board to transition to a 13-member board, as specified. The bill would remove from the board attorney members elected from State Bar Districts and would make conforming changes. The bill would provide that each appointing body, when making appointments to the board after December 31, 2016, should consider appointing members who have education or experience, or both, in one of 6 specified areas, including public finance. The bill would require that a maximum of 6 members of the board be public members, as appointed by specified entities, and would require members of the board to serve a term of 4 years. The bill would require thebegin insert Californiaend insert Supreme Court to select from the members of the board a chair and vice chair instead of the board of trustees electing a president and vice president. The bill would require members of the executive committee of the board to include at least one member of the board appointed by each appointing authority.

Thisbegin delete bill would provide that protection of the public requires that professional legal services are provided in a competent, accessible, and ethical manner, and that the judicial system functions in a fair, impartial, and just manner. The bill would define protection of the public, for purposes of staffing and resource allocations, as specified core functions of the State Bar, including, administration of the bar admissions and law school accreditation processes. Theend delete bill would provide that any decision of the board raising antitrust concerns is subject to review, modification, veto, or other appropriate action by the California Supreme Court.

The bill would require the Office of Chief Trial Counsel to open a nonattorney complaint against a person when the office becomes aware of an allegation that a person not licensed to practice law in California has practiced or held himself or herself out as practicing law or entitled to practice law in the state and would require the complaint to be evaluated and processed, as specified.

This bill would require the Attorney General to appoint a State Bar enforcement program monitor prior to March 31, 2017, and would require the program enforcement monitor to evaluate the disciplinary system and procedures of the State Bar, as specified. The bill would require the program enforcement monitor to submit an initial report no later than October 1, 2019, and to issue a final report before March 31, 2020. The bill would make these provisions inoperative on March 31, 2020, and would repeal the provision as of January 1, 2021.

The bill would require the board of trustees to engage the services of an independent national or regional public accounting firm with at least 5 years of experience in governmental auditing for an audit of its revenues, expenditures, reserves, and financial statements for each fiscal year and would require the California State Auditor, for the performance audit due in January 2017, to review all of the State Bar’s expenses, including, but not limited to, executive salaries. The bill would also require California State Auditor to conduct a performance audit evaluating the State Bar’s progress in certain areas, including correcting any issues raised in prior California State Auditor audits, and would require the California State Auditor to report its findings and recommendations, as specified.

This bill would provide that access to records of the State Bar Court is subject to the rules and laws applicable to the judiciary instead of the California Public Records Act and would exempt the State Bar Court from the Bagley-Keene Open Meeting Act.

This bill, until January 1, 2018, would require the board to charge an annual membership fee in a specified amount for 2017. The bill would repeal the provision prohibiting the Legislature from reducing the maximum membership fee and would prohibit the State Bar from creating any foundation or nonprofit corporations, as specified. The bill would require the State Bar to conduct a thorough analysis of the Client Security Fund and to submit a report to the Legislature on its analysis of that fund by March 15, 2017, as specified.

Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

This bill would make legislative findings to that effect.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P4    1

SECTION 1.  

Section 6001 of the Business and Professions
2Code
is amended to read:

3

6001.  

The State Bar of California is a public corporation. It is
4hereinafter designated as the State Bar.

5The State Bar has perpetual succession and a seal and it may sue
6and be sued. It may, for the purpose of carrying into effect and
7promoting its objectives:

8(a) Make contracts.

9(b) Borrow money, contract debts, issue bonds, notes, and
10debentures and secure the payment or performance of its
11obligations.

12(c) Own, hold, use, manage, and deal in and with real and
13personal property.

14(d) Construct, alter, maintain, and repair buildings and other
15improvements to real property.

P5    1(e) Purchase, lease, obtain options upon, acquire by gift, bequest,
2 devise, or otherwise, any real or personal property or any interest
3therein.

4(f) Sell, lease, exchange, convey, transfer, assign, encumber,
5pledge, dispose of any of its real or personal property or any
6interest therein, including without limitation all or any portion of
7its income or revenues from membership fees paid or payable by
8members.

9(g) Do all other acts incidental to the foregoing or necessary or
10expedient for the administration of its affairs and the attainment
11of its purposes.

12Pursuant to those powers enumerated in subdivisions (a) to (g),
13inclusive, it is recognized that the State Bar has authority to raise
14revenue in addition to that provided for in Section 6140 and other
15statutory provisions. The State Bar is empowered to raise that
16additional revenue by any lawful means. However, as of December
1731, 2016, the State Bar shall not create any foundations or nonprofit
18corporations.

19The State Bar shall conspicuously publicize to its members in
20the annual dues statement and other appropriate communications,
21including its Web site and electronic communications, that its
22members have the right to limit the sale or disclosure of member
23information not reasonably related to regulatory purposes. In those
24communications the State Bar shall note the location of the State
25Bar’s privacy policy, and shall also note the simple procedure by
26which a member may exercise his or her right to prohibit or restrict,
27at the member’s option, the sale or disclosure of member
28information not reasonably related to regulatory purposes. On or
29before May 1, 2005, the State Bar shall report to the Assembly
30and Senate Committees on Judiciary regarding the procedures that
31it has in place to ensure that members can appropriately limit the
32use of their member information not reasonably related to
33regulatory purposes, and the number of members choosing to
34utilize these procedures.

35No law of this state restricting, or prescribing a mode of
36procedure for the exercise of powers of state public bodies or state
37agencies, or classes thereof, including, but not by way of limitation,
38the provisions contained in Division 3 (commencing with Section
3911000), Division 4 (commencing with Section 16100), and Part 1
40(commencing with Section 18000) and Part 2 (commencing with
P6    1Section 18500) of Division 5, of Title 2 of the Government Code,
2shall be applicable to the State Bar, unless the Legislature expressly
3so declares. Notwithstanding the foregoing or any other law,
4pursuant to Sections 6026.7 and 6026.11, the State Bar is subject
5to the California Public Records Act (Chapter 3.5 (commencing
6with Section 6250) of Division 7 of Title 1 of the Government
7Code) and, commencing April 1, 2016, the Bagley-Keene Open
8Meeting Act (Article 9 (commencing with Section 11120) of
9Chapter 1 of Part 1 of Division 3 of Title 2 of the Government
10Code).

begin delete
11

SEC. 2.  

Section 6001.1 of the Business and Professions Code
12 is amended to read:

13

6001.1.  

(a) Protection of the public shall be the highest priority
14for the State Bar of California and the board of trustees in
15exercising their licensing, regulatory, and disciplinary functions.
16Whenever the protection of the public is inconsistent with other
17interests sought to be promoted, the protection of the public shall
18be paramount.

19(b) Protection of the public requires that professional legal
20services are provided in a competent, accessible, and ethical manner
21and that the judicial system functions in a fair, impartial, and just
22manner. For purposes of staffing and resource allocations,
23protection of the public is defined as the following core functions
24of the State Bar in the following order of priority:

25(1) Administration of the bar admissions and law school
26accreditation processes, recordkeeping and licensing functions,
27and the lawyer discipline system.

28(2) Administration of programs that advance professional
29competence and ethics, support the prevention of discipline
30problems before they occur, address the unlawful practice of law,
31and support the judicial selection process.

32(3) Administration of programs that support the fair and equal
33administration of justice, effective functioning of the legal system,
34and diversity of the profession.

end delete
35

begin deleteSEC. 3.end delete
36
begin insertSEC. 2.end insert  

Section 6008.5 of the Business and Professions Code
37 is repealed.

38begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 6008.6 of the end insertbegin insertBusiness and Professions Codeend insert
39
begin insert is amended to read:end insert

P7    1

6008.6.  

begin insert(a)end insertbegin insertend insert The State Bar shall award no contract for goods,
2services, or both, for an aggregate amount in excess of fifty
3thousand dollars ($50,000), or for information technology goods,
4services, or both, for an aggregate amount in excess of one hundred
5thousand dollars ($100,000), except pursuant to the standards
6established in Article 4 (commencing with Section 10335) of
7Chapter 2 of Part 2 of Division 2 of the Public Contractbegin delete Code.end delete
8begin insert Code and approval of the board of trustees.end insert The State Bar shall
9establish a request for proposal procedure by rule, pursuant to the
10general standards established in Article 4 (commencing with
11Section 10335) of Chapter 2 of Part 2 of Division 2 of the Public
12Contract Code. For the purposes of this section, “information
13technology” includes, but is not limited to, all electronic technology
14systems and services, automated information handling, system
15design and analysis, conversion voice, video, and data
16communications, network systems, requisite facilities, equipment,
17system controls, stimulation, electronic commerce, and all related
18interactions between people and machines.

begin insert

19
(b) The board of trustees shall adopt policies and procedures
20to require board approval of any contract that could impact the
21State Bar’s ability to carry out its paramount duty to protect the
22public.

end insert
23

SEC. 4.  

Section 6009.7 of the Business and Professions Code
24 is repealed.

25

SEC. 5.  

Section 6011 of the Business and Professions Code is
26amended to read:

27

6011.  

(a) The board shall consist of no more than 19 members
28and no fewer than 13 members.

29(b) It is the intent of the Legislature that the board consist of no
30more than 19 members and no fewer than 13 members during the
31period of transition from a 19-member board to a 13-member
32board. It is the intent of the Legislature that the board decrease its
33size without shortening, lengthening, or abolishing terms
34commencing prior to December 31, 2016, with the ultimate goal
35of instituting a 13-member board no later than October 31, 2019.
36It is the intent of the Legislature that this transition occur by the
37expiration of the terms of the elected members who are serving
38on the board as of December 31, 2016.

39(c) When making appointments to the board on and after
40December 31, 2016, each appointing body should consider
P8    1appointing members with education or experience, or both, in at
2least one of the following:

3(1) Public finance.

4(2) Public administration.

5(3) Business or financial management.

6(4) State government, particularly prior regulatory experience.

7(5) Legal ethics.

8(6) Immigration law.

9

SEC. 6.  

Section 6012 of the Business and Professions Code is
10repealed.

11

SEC. 7.  

Section 6013.1 of the Business and Professions Code
12 is amended to read:

13

6013.1.  

(a) The Supreme Court shall appoint five attorney
14members of the board pursuant to a process that the Supreme Court
15may prescribe. These attorney members shall serve for a term of
16four years and may be reappointed by the Supreme Court for one
17additional term only.

18(b) An attorney member elected pursuant to Section 6013.2 may
19be appointed by the Supreme Court pursuant to this section to a
20term as an appointed attorney member.

21(c) The Supreme Court shall fill any vacancy in the term of, and
22make any reappointment of, any appointed attorney member.

23(d) When making appointments to the board, the Supreme Court
24should consider appointing attorneys that represent the following
25categories: legal services; small firm or solo practitioners;
26historically underrepresented groups, including consideration of
27race, ethnicity, gender, and sexual orientation; and legal academics.
28In making appointments to the board, the Supreme Court should
29also consider geographic distribution, years of practice, particularly
30attorneys who are within the first five years of practice or 36 years
31of age and under, and participation in voluntary local or state bar
32activities.

33(e) The State Bar shall be responsible for carrying out the
34administrative responsibilities related to the appointment process
35described in subdivision (a).

36

SEC. 8.  

Section 6013.2 of the Business and Professions Code
37 is repealed.

38

SEC. 9.  

Section 6013.3 of the Business and Professions Code
39 is amended to read:

P9    1

6013.3.  

(a) One attorney member of the board shall be
2appointed by the Senate Committee on Rules and one attorney
3member of the board shall be appointed by the Speaker of the
4Assembly.

5(b) An attorney member appointed pursuant to this section shall
6serve for a term of four years. Vacancies shall be filled for the
7remainder of the term. An appointed attorney member may be
8reappointed pursuant to this section.

9

SEC. 10.  

Section 6013.5 of the Business and Professions Code
10 is amended to read:

11

6013.5.  

(a) Effective January 1, 2017, a maximum of six
12members of the board shall be members of the public who have
13never been members of the State Bar or admitted to practice before
14any court in the United States.

15(b) Each of these members shall serve for a term of four years.
16Vacancies shall be filled for the remainder of the term.

17 (c) Effective January 1, 2017, one public member shall be
18appointed by the Senate Committee on Rules and one public
19member shall be appointed by the Speaker of the Assembly.

20(d) Four public members shall be appointed by the Governor,
21subject to the confirmation of the Senate.

22(e) Each respective appointing authority shall fill any vacancy
23in and make any reappointment to each respective office.

24

SEC. 11.  

Section 6015 of the Business and Professions Code
25 is amended to read:

26

6015.  

No person is eligible for attorney membership on the
27board unless both of the following conditions are satisfied:

28(a) He or she is an active member of the State Bar.

29(b) Either:

30(1) Prior to October 31, 2019, if elected, he or she maintains
31his or her principal office for the practice of law within the State
32Bar district from which he or she is elected.

33(2) If appointed by the Supreme Court or the Legislature, he or
34she maintains his or her principal office for the practice of law
35within the State of California.

36

SEC. 12.  

Section 6016 of the Business and Professions Code
37 is amended to read:

38

6016.  

The term of office of each attorney member of the board
39shall be four years and he or she shall hold office until his or her
P10   1successor is appointed and qualified. Vacancies shall be filled for
2the remainder of the term.

3The board of trustees may provide by rule for an interim board
4to act in the place and stead of the board when because of vacancies
5during terms of office there is less than a quorum of the board.

6

SEC. 13.  

Section 6018 of the Business and Professions Code
7 is repealed.

8

SEC. 14.  

Section 6019 of the Business and Professions Code
9 is amended to read:

10

6019.  

Each place upon the board for which a member is to be
11appointed shall for the purposes of the appointment be deemed a
12separate office.

13

SEC. 15.  

Section 6021 of the Business and Professions Code
14 is amended to read:

15

6021.  

(a) (1) Thebegin insert Californiaend insert Supreme Court shall select from
16the members of the board a chair and a vice chair to serve in the
17absence of the chair.

18(2) The chair and vice chair shall assume the duties of their
19respective offices at the conclusion of the annual meeting following
20their appointment.

21(b) The term of the board chair and vice chair shall be one year.

22

SEC. 16.  

Section 6022 of the Business and Professions Code
23 is amended to read:

24

6022.  

The secretary and treasurer of the State Bar shall be
25selected annually by the board and need not be members of the
26State Bar.

27

SEC. 17.  

Section 6026.5 of the Business and Professions Code,
28as added by Section 3 of Chapter 537 of the Statutes of 2015, is
29repealed.

30

SEC. 18.  

Section 6026.7 of the Business and Professions Code,
31as added by Section 5 of Chapter 537 of the Statutes of 2015, is
32amended to read:

33

6026.7.  

(a) The State Bar is subject to the Bagley-Keene Open
34Meeting Act (Article 9 (commencing with Section 11120) of
35Chapter 1 of Part 1 of Division 3 of Title 2 of the Government
36Code) and all meetings of the State Bar are subject to the
37Bagley-Keene Open Meeting Act.

38(b) Notwithstanding any other law, the Bagley-Keene Open
39Meeting Act shall not apply to the Judicial Nominees Evaluation
P11   1Commission, the Committee of Bar Examiners, or the State Bar
2Court.

3(c) In addition to the grounds authorized in the Bagley-Keene
4Open Meeting Act, a closed session may be held for those
5meetings, or portions thereof, relating to both of the following:

6(1) Appeals from decisions of the Board of Legal Specialization
7refusing to certify or recertify an applicant or suspending or
8revoking a specialist’s certificate.

9(2) The preparation, approval, grading, or administration of
10examinations for certification of a specialist.

11

SEC. 19.  

Section 6029 of the Business and Professions Code
12 is amended to read:

13

6029.  

(a) The board may appoint such committees, officers
14and employees as it deems necessary or proper, and fix and pay
15salaries and necessary expenses.

16(b) The members of the executive committee of the board shall
17include at least one board member appointed by each of the
18following appointing authorities:

19(1) The Supreme Court.

20(2) The Governor.

21(3) The Speaker of the Assembly.

22(4) The Senate Committee on Rules.

23

SEC. 20.  

Section 6030 of the Business and Professions Code
24 is amended to read:

25

6030.  

(a) The board shall be charged with the executive
26function of the State Bar and the enforcement of the provisions of
27this chapter.

28(b) The violation or threatened violation of any provision of
29Articles 7 (commencing with Section 6125) and 9 (commencing
30with Section 6150) of this chapter may be enjoined in a civil action
31brought in the superior court by the State Bar and no undertaking
32shall be required of the State Bar.

33(c) Any decision of the board raising antitrust concerns is subject
34to review, modification, veto, or other appropriate action by the
35California Supreme Court.

36

SEC. 21.  

Section 6060.2 of the Business and Professions Code
37 is amended to read:

38

6060.2.  

(a) All investigations or proceedings conducted by
39the State Bar concerning the moral character of an applicant shall
40be confidential and shall not be disclosed pursuant to any state
P12   1law, including, but not limited to, the California Public Records
2Act (Chapter 3.5 (commencing with Section 6250) of Division 7
3of Title 1 of the Government Code) unless the applicant, in writing,
4waives the confidentiality.

5(b) Notwithstanding subdivision (a), the records of the
6proceeding may be disclosed in response to either of the following:

7(1) A lawfully issued subpoena.

8(2) A written request from a government agency responsible
9for either the enforcement of civil or criminal laws or the
10professional licensing of individuals that is conducting an
11investigation about the applicant.

12

SEC. 22.  

Section 6060.25 of the Business and Professions
13Code
is amended to read:

14

6060.25.  

(a) Notwithstanding any other law, any identifying
15information submitted by an applicant to the State Bar for
16admission and a license to practice law and all State Bar admission
17records, including, but not limited to, bar examination scores, law
18school grade point average (GPA), undergraduate GPA, Law
19School Admission Test scores, race or ethnicity, and any
20information contained within the State Bar Admissions database
21or any file or other data created by the State Bar with information
22submitted by the applicant that may identify an individual
23applicant, other than information described in subdivision (b), shall
24be confidential and shall not be disclosed pursuant to any state
25law, including, but not limited to, the California Public Records
26Act (Chapter 3.5 (commencing with Section 6250) of Division 7
27of Title 1 of the Government Code).

28(b) (1) This section does not prohibit the disclosure of any of
29the following:

30(A) The names of applicants who have passed any examination
31administered, given, or prescribed by the Committee of Bar
32Examiners.

33(B) Information that is provided at the request of an applicant
34to another jurisdiction where the applicant is seeking admission
35to the practice of law.

36(C) Information provided to a law school that is necessary for
37the purpose of the law school’s compliance with accreditation or
38regulatory requirements.

P13   1(D) Information provided to the National Conference of Bar
2Examiners or a successor nonprofit organization in connection to
3the State Bar’s administration of any examination.

4(2) This subdivision shall apply retroactively to January 1, 2016.

5(c) Disclosure of any of the information in subparagraphs (B)
6to (D), inclusive, of paragraph (1) of subdivision (b) shall not
7constitute a waiver under Section 6254.5 of the Government Code
8of the exemption from disclosure provided for in subdivision (a)
9of this section.

10

SEC. 23.  

Section 6075.6 is added to the Business and
11Professions Code
, to read:

12

6075.6.  

(a) (1) The Attorney General shall appoint a State
13Bar enforcement program monitor prior to March 31, 2017. The
14applicant for the position shall have investigative experience, shall
15be familiar with California laws and procedures, and, preferably,
16shall be familiar with the rules and procedures of the State Bar
17lawyer discipline system and relevant administrative procedures.
18The monitor may be a state employee or his or her services may
19be provided pursuant to contract.

20(2) The Attorney General shall supervise the monitor and may
21terminate or dismiss him or her from this position.

22(b) (1) The enforcement program monitor shall monitor and
23evaluate the disciplinary system and procedures of the State Bar.
24The enforcement program monitor shall make his or her highest
25priority the reform and reengineering of the State Bar’s
26enforcement program and operations and the improvement of the
27overall efficiency of the State Bar’s disciplinary system so that the
28State Bar is successfully and consistently protecting the public.

29(2) This monitoring duty shall include, but not be limited to,
30the prioritization of cases most impacting public protection,
31improving the timeframe for the handling of complaints and in the
32rendering of initial decisions on complaints, the efficiency of the
33system, the fairness and courtesy given to complainants, the
34adequacy of the staffing and the budget allocated to the discipline
35section of the State Bar, the reduction of the complaint backlog,
36the consistency in the application of sanctions or discipline
37imposed, the implementation of laws affecting discipline and the
38State Bar’s operations, disciplinary standards and rules, staff
39concerns regarding disciplinary matters or procedures, and the
40State Bar’s cooperation with other governmental entities charged
P14   1with enforcing related laws and regulations that affect members
2of the State Bar.

3(3) The monitor shall exercise no authority over the State Bar’s
4discipline operations or staff, however, the State Bar and its staff
5shall cooperate with the program enforcement monitor, and the
6begin insert Stateend insert Bar shall provide data, information, and case files as
7requested by the enforcement program monitor to perform all of
8his or her duties.

9(c) The enforcement program monitor shall submit an initial
10written report of his or her findings and conclusions to the State
11Bar, thebegin insert Californiaend insert Supreme Court, and the Legislature no later
12than October 1, 2019, and be available to make oral reports to each
13if requested to do so. The initial report shall include an analysis
14of the sources of information that resulted in each disciplinary
15action imposed since January 1, 2016. The monitor may also
16provide additional information to either thebegin insert Californiaend insert Supreme
17Court, the State Bar, or the Legislature at his or her discretion or
18at the request of thebegin insert Californiaend insert Supreme Court, the State Bar, or
19the Legislature. The program enforcement monitor shall make his
20or her reports available to the public or the media. The monitor
21shall make every effort to provide the State Bar with an opportunity
22to reply to any facts, findings, issues, or conclusions in his or her
23reports with which the State Bar may disagree.

24(d) The enforcement program monitor shall issue a final report
25prior to March 31, 2020.

26(e) This section shall become inoperative on March 31, 2020,
27and as of January 1, 2021, shall be repealed.

28

SEC. 24.  

Section 6086.5 of the Business and Professions Code
29 is amended to read:

30

6086.5.  

The board of trustees shall establish a State Bar Court,
31to act in its place and stead in the determination of disciplinary
32and reinstatement proceedings and proceedings pursuant to
33subdivisions (b) and (c) of Section 6007 to the extent provided by
34rules adopted by the board of trustees pursuant to this chapter. In
35these proceedings the State Bar Court may exercise the powers
36and authority vested in the board of trustees by this chapter,
37including those powers and that authority vested in committees
38of, or established by, the board, except as limited by rules of the
39board of trustees within the scope of this chapter.

P15   1Access to records of the State Bar Court shall be governed by
2court rules and laws applicable to records of the judiciary and not
3the California Public Records Act (Chapter 3.5 (commencing with
4 Section 6250) of Division 7 of Title 1 of the Government Code).

5For the purposes of Sections 6007, 6043, 6049, 6049.2, 6050,
66051, 6052, 6077 (excluding the first sentence), 6078, 6080, 6081,
7and 6082, “board” includes the State Bar Court.

8Nothing in this section shall authorize the State Bar Court to
9adopt rules of professional conduct or rules of procedure.

10The Executive Committee of the State Bar Court may adopt
11rules of practice for the conduct of all proceedings within its
12jurisdiction. These rules may not conflict with the rules of
13procedure adopted by the board, unless approved by thebegin insert Californiaend insert
14 Supreme Court.

15

SEC. 25.  

Section 6134 is added to the Business and Professions
16Code
, to read:

17

6134.  

(a) When the Office of the Chief Trial Counsel becomes
18aware of an allegation that a person not licensed to practice law
19in California has practiced or held himself or herself out as
20practicing law or entitled to practice law in the state, the office’s
21intake unit shall open a nonattorney complaint against that person
22for evaluation and processing.

23(b) The intake unit shall open a case record in the office’s case
24management system with the complaint form received date. The
25complaint form received date shall be the date the State Bar first
26received the complaint. Evaluation and processing of the
27nonattorney complaint shall include, but not be limited to, all of
28the following:

29(1) Creation of a summary of the allegation or allegations in the
30case record and assignment to staff, including inputting staff
31assignment codes into the case management system.

32(2) Identifying the source of the complaint.

33(3) Identifying the relevant practice area of law, such as
34immigration, loan modification, or debt resolution, and recording
35the relevant practice area of law in the case record.

36(4) Identifying whether the allegations include potential identity
37theft of a licensed attorney’s identity and, if so, contacting the
38potential victim attorney to verify whether the attorney is aware
39of the potential identify theft and whether he or she has notified
40law enforcement.

P16   1(5) Evaluating the nonattorney complaint for unauthorized
2 practice of law allegations, which includes opening a corresponding
3attorney complaint case record, if appropriate, such as in the case
4in which the nonattorney complaint also identifies a licensed
5California attorney potentially aiding or abetting the person in the
6unauthorized practice of law.

7(6) Seeking additional information from the complainant or
8other sources, such as the Internet, when the nonattorney complaint
9does not provide specific or sufficient facts to establish that the
10unauthorized practice of law may have occurred.

11(7) Determining whether to forward the complaint to the
12enforcement unit for investigation.

13(c) If the nonattorney complaint sufficiently alleges an
14unauthorized practice of law violation, the intake unit shall do both
15of the following:

16(1) Forward the nonattorney complaint to the enforcement unit
17for further action.

18(2) Refer the matter to law enforcement or other appropriate
19agency for consideration of criminal or other enforcement action,
20as specified in subdivisions (f) and (g).

21(d) If the nonattorney complaint sufficiently alleges the use of
22“notario,” “notario publico,” or other words or phrases in violation
23of Section 6126.7 or there is other evidence of a violation of
24Section 6126.7, the intake unit shall forward the complaint to the
25enforcement unit for further action.

26(e) If the nonattorney complaint does not sufficiently allege an
27unauthorized practice of law violation or a violation of Section
286126.7, the intake unit shall do all of the following:

29(1) Notify the complainant in writing of the determination.

30(2) Advise the complainant in writing of the opportunity to seek
31reconsideration of the determination.

32(3) Process the case for closure, including updating the case
33record.

34(f) The intake unit’s staff shall resolve nonattorney complaints
35by either:

36(1) Forwarding the nonattorney complaint to the office’s
37enforcement unit.

38(2) Closing the nonattorney complaint in the intake unit.

39(g) (1) A nonattorney complaint alleging the unauthorized
40practice of law shall be presumed to warrant a law enforcement
P17   1referral to federal, state, or local authorities, such as the United
2States Attorney, the Attorney General, the local district attorney,
3local county counsel, or local city attorney, for criminal or other
4enforcement action.

5(2) After the intake unit forwards a nonattorney complaint, the
6office’s enforcement unit shall make the referral required under
7paragraph (1), where appropriate, and shall coordinate with law
8enforcement, as appropriate, throughout the office’s investigation
9of the nonattorney complaint.

10(3) The intake unit may, where warranted, refer nonattorney
11complaints that do not allege the unauthorized practice of law to
12another regulatory agency, such as the Bureau of Real Estate, the
13Department of Consumer Affairs, the United States Securities and
14Exchange Commission, the Federal Trade Commission, and the
15United States Patent and Trademark Office.

16(h) Staff of the intake unit shall evaluate nonattorney complaints
17and strive to meet all of the following in at least 90 percent of
18nonattorney complaints filed:

19(1) Open a nonattorney complaint case record within five days
20from the complaint form received date, as defined in subdivision
21(b).

22(2) Complete the initial legal review of the nonattorney
23complaint within 20 days from the complaint form received date.

24(3) Process the nonattorney complaint to resolution, which
25means closing the case or forwarding the case for investigation,
26within 60 days from the complaint form received date.

27(i) Staff of the intake unit shall maintain processing activities
28in the nonattorney complaint case record, including the recording
29and tracking of other regulatory agency referrals made in
30connection with a nonattorney complaint.

31(j) All nonattorney complaints forwarded by the intake unit to
32the office’s enforcement unit shall be investigated to determine
33whether there is evidence of the unauthorized practice of law or
34any violation of Section 6126.7. There shall be an appropriate law
35enforcement referral upon assignment to a staff member of the
36enforcement unit. Assigned enforcement unit staff shall update
37any law enforcement agency to which the complaint was referred
38with the status and findings of the investigation as it proceeds.
39Upon completion of an investigation, the assigned staff of the
40enforcement unit shall analyze the evidence to determine whether
P18   1the evidence is sufficient to support formal proceedings in superior
2court.

3(k) Enforcement unit staff shall complete nonattorney complaint
4investigations to resolution by one of the following:

5(1) Filing enforcement proceedings in superior court.

6(2) Issuing a cease and desist letter. Enforcement unit staff may
7issue a cease and desist letter where the unauthorized practice of
8law activity appears isolated in nature and unlikely to recur or
9where it otherwise appears that a cease and desist warning will
10sufficiently address and stop the activity at issue.

11(3) Closing the complaint with no further action.

12(l) Enforcement unit staff shall investigate nonattorney
13complaints adhering to the same backlog time standard applicable
14to attorney discipline complaints and shall resolve the complaint
15within six months from the complaint form received date.

16(m) Intake unit staff and enforcement unit staff shall, as
17appropriate, maintain and update processing activities in the
18nonattorney case record, as follows:

19(1) Record and track the number of superior court proceedings
20initiated pursuant to Section 6126.3.

21(2) Record and track the number of superior court proceedings
22initiated pursuant to Section 6126.4.

23(3) Record and track the number of superior court proceedings
24initiated pursuant to Section 6126.7.

25(4) Record and track the number of superior court proceedings
26initiated pursuant to Section 6127.

27(5) Record and track the number of law enforcement referrals
28made in connection with nonattorney complaints.

29(6) Record and track the number of other agency referrals made
30in connection with nonattorney complaints.

31(7) Record and track the number of cease and desist letters
32issued in connection with nonattorney complaints.

33(n) The Office of Chief Trial Counsel shall hire at least one
34supervising attorney with the following experience:

35(1) At least three years of experience handling asylum, T-Visa,
36U-Visa, or special immigrant juvenile status cases and has
37represented at least 25 individuals in these matters.

38(2) Experience in representing individuals in removal
39proceedings and asylum applications.

P19   1

SEC. 26.  

Section 6140 of the Business and Professions Code
2 is amended to read:

3

6140.  

(a) The board shall fix the annual membership fee for
4active members for 2017 at a sum not exceeding three hundred
5fifteen dollars ($315).

6(b) The annual membership fee for active members is payable
7on or before the first day of February of each year. If the board
8finds it appropriate and feasible, it may provide by rule for payment
9of fees on an installment basis with interest, by credit card, or other
10means, and may charge members choosing any alternative method
11of payment an additional fee to defray costs incurred by that
12election.

13(c) This section shall remain in effect only until January 1, 2018,
14and, as of that date, is repealed, unless a later enacted statute, that
15is enacted before January 1, 2018, deletes or extends that date.

16

SEC. 27.  

Section 6140.56 is added to the Business and
17Professions Code
, to read:

18

6140.56.  

(a) To ensure that the Client Security Fund can
19adequately protect the public and relieve or mitigate financial
20losses caused by the dishonest conduct of members of the State
21Bar by paying claims in a timely manner, the State Bar shall
22conduct a thorough analysis of the Client Security Fund, including
23a review of the governance structure of the Client Security Fund
24to ensure that the structure provides for the most effective and
25efficient operation of the fund, a determination of the ongoing
26needs of the fund to satisfy claims in a timely manner, a review
27of additional efforts that can be taken to increase the collection of
28payments from the responsible attorneys, and a review of other
29State Bar expenditures to determine whether other expenditures
30that do not directly impact the State Bar’s public protection
31functions, including, but not limited to, executive salaries and
32benefits, can be reduced or redirected in order to better fund the
33Client Security Fund through existing revenue, and, whether, after
34all other options have been fully and thoroughly exhausted, an
35increase in membership dues is necessary to ensure that the Client
36Security Fund can timely pay claims.

37(b) The State Bar shall submit a report on its analysis of the
38Client Security Fund to the Legislature by March 15, 2017, so that
39the plans can be reviewed in conjunction with the bill that would
40authorize the imposition of the State Bar’s membership fee. The
P20   1report shall be submitted in compliance with Section 9795 of the
2Government Code.

3(c) For purposes of this section, “timely manner” means within
412 months from the later of the time the claim is received by the
5State Bar and upon the resolution of the underlying discipline case
6involving an attorney member, which is a prerequisite to paying
7the claim.

8

SEC. 28.  

Section 6145 of the Business and Professions Code
9 is amended to read:

10

6145.  

(a) The board shall engage the services of an independent
11national or regional public accounting firm with at least five years
12of experience in governmental auditing for an audit of its revenues,
13expenditures, reserves, and its financial statement for each fiscal
14year. The financial statement shall be promptly certified under
15oath by the Treasurer of the State Bar, and a copy of the audit and
16financial statement shall be submitted within 120 days of the close
17of the fiscal year to the board, to the Chief Justice of California,
18and to the Assembly and Senate Committees on Judiciary.

19The audit shall examine the receipts and expenditures of the
20State Bar and the State Bar sections to ensure that the receipts of
21the sections are being applied, and their expenditures are being
22made, in compliance with subdivision (a) of Section 6031.5, and
23that the receipts of the sections are applied only to the work of the
24sections.

25The audit also shall examine the receipts and expenditures of
26the State Bar to ensure that the funds collected on behalf of the
27Conference of Delegates of California Bar Associations as the
28independent successor entity to the former Conference of Delegates
29of the State Bar are conveyed to that entity, that the State Bar has
30been paid or reimbursed for the full cost of any administrative and
31support services provided to the successor entity, including the
32collection of fees or donations on its behalf, and that no mandatory
33dues are being used to fund the activities of the successor entity.

34In selecting the accounting firm, the board shall consider the
35value of continuity, along with the risk that continued long-term
36engagements of an accounting firm may affect the independence
37of that firm.

38(b) The board shall contract with the California State Auditor’s
39Office to conduct a performance audit of the State Bar’s operations
40from July 1, 2000, to December 31, 2000, inclusive. A copy of the
P21   1performance audit shall be submitted by May 1, 2001, to the board,
2to the Chief Justice of California, and to the Assembly and Senate
3Committees on Judiciary.

4Every two years thereafter, the board shall contract with the
5California State Auditor’s Office to conduct a performance audit
6of the State Bar’s operations for the respective fiscal year,
7commencing with January 1, 2002, to December 31, 2002,
8inclusive. A copy of the performance audit shall be submitted
9within 120 days of the close of the fiscal year for which the audit
10was performed to the board, to the Chief Justice of California, and
11to the Assembly and Senate Committees on Judiciary.

12For the performance audit due to the board, to the Chief Justice
13of the California Supreme Court, and to the Assembly and Senate
14Committees on Judiciary in 2017, the California State Auditor
15shall review all of the State Bar’s expenses, including, but not
16limited to, executive salaries and benefits, outside contracts, and
17real estate holdings, to determine the expenses that are appropriate
18and necessary to protect the public and what the appropriate level
19of member dues should be.

20For the purposes of this subdivision, the California State
21Auditor’s Office may contract with a third party to conduct the
22performance audit. This subdivision is not intended to reduce the
23number of audits the California State Auditor’s Office may
24otherwise be able to conduct.

25(c) (1) In addition to the audits required in subdivision (b), the
26California State Auditor shall conduct a performance audit
27evaluating the State Bar’s progress in:

28(A) Reviewing any changes in the State Bar’s expenses made
29as a result of prior audits by the California State Auditor.

30(B) Correcting any issues raised in prior audits by the California
31State Auditor.

32(C) Increasing operational effectiveness and efficiency.

33(2) The California State Auditor shall report its findings and
34recommendations to the board, to the Chief Justice of California,
35to the Assembly Committee on Judiciary, and to the Senate
36Committee on Judiciary, no later than June 15, 2018.

37

SEC. 29.  

The Legislature finds and declares that Sections 18
38and 24 of this act, which amend Sections 6026.7 and 6086.5 of
39the Business and Professions Code, impose a limitation on the
40public’s right of access to the meetings of public bodies or the
P22   1writings of public officials and agencies within the meaning of
2Section 3 of Article I of the California Constitution. Pursuant to
3that constitutional provision, the Legislature makes the following
4findings to demonstrate the interest protected by this limitation
5and the need for protecting that interest:

6In order to protect the decisionmaking process of the State Bar
7Court in a manner that is similar to the deliberative functions of
8other courts and in order to ensure that personal or sensitive
9information regarding discipline by the State Bar Court is kept
10confidential, including for persons participating in discussions and
11offers of settlement pursuant to arbitration or mediation, it is
12necessary to exempt the State Bar Court from the provision of the
13Bagley-Keene Open Meeting Act and the California Public Records
14Act.



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