Regulations Governing State Bar Significantly Altered in SB 40 in Light of Girardi Scandal


By Erol Kilic

SB 40 (Umberg), as amended September 7, 2023, amends various sections of the Business and Professions Code. According to the Senate Floor Analysis, the State Bar’s highest priority is public protection, including swift disciplinary actions against incompetent attorneys. In light of the Girardi misconduct and the May and Lazar reports, the Senate analysis recognized the State Bar has failed in its mission. The last round of Assembly amendments significantly altered several State Bar regulations. SB 40 is the State Bar’s annual licensing fee bill, but also amends a broad variety of procedural and substantive regulations, including: (1) conflicts of interest provisions; (2) additional disciplinary provisions; (3) several reporting requirements alterations; and (4) new and modified funding authorizations. [28:2 CRLR 127]

Section 6001(e)(1) states the State Bar shall not be subject to state laws that restrict or prescribe a mode of procedure unless the legislature expressly declares. This bill added subdivision (e)(3), which subjects members of the State Bar Board of Trustees and employees of the State Bar to specific conflicts of interest provisions relating to contracts that are generally applicable to public officers and employees. The State Bar remains subject to the California Public Records Act and the Bagley-Keene Open Meetings Act under subdivision (e)(2).

Section 6036 is amended to expand the scope of disqualification for Board members to include decisions in which members have personal interests, including financial interests, in any State Bar decision that may influence the decision.

Section 6001.5 is added to revise and recast provisions under the State Civil Service Act. This section requires all employees, prospective employees, volunteers, contractors, and subcontractors to submit fingerprints to the Department of Justice and the Federal Bureau of Investigation to establish identity and determine if the person has a record of criminal conviction in California or other states. This record check includes a national criminal history check.

Section 6086.1 is amended to require hearings and records of original disciplinary proceedings in the State Bar Court to be made public following the filing of a notice of disciplinary charges rather than a notice to show cause. Section 6086.1 further revised the circumstances under which confidentiality pertaining to disciplinary investigations may be waived by authorizing the Board to vote to waive such confidentiality when warranted for the protection of the public. The Board is required to hold a meeting under these provisions in a closed session and provide notice to the licensee whose confidential information is being considered for disclosure, with a presumption in favor of maintaining confidentiality under specified considerations. The licensee is authorized to file a motion to prevent the disclosure of information pursuant to the waiver. The State Bar Court would rule on the motion within 10 court days of the filing.

Section 6086.1 further restricts the Chief Trial Counsel’s (CTC) and the Chair of the Board’s authority to waive confidentiality of disciplinary investigations by requiring: (1) the CTC and the Chair exercise authority with written concurrence; (2) a determination that disclosure is needed to prevent immediate harm to the public; and (3) the amended provisions related to the Board’s authority to waive confidentiality are inadequate to protect the public.

Section 6102 previously required a court to dismiss a proceeding if an attorney was not disbarred or suspended from practice following a conviction that involved moral turpitude. Section 6102 is amended to require a court to determine if the facts and circumstances of the conviction involve other misconduct that warrants discipline and impose appropriate discipline rather than dismiss the proceeding.

Section 6140.55 provides an increase in annual license fees of $40 for active, and $10 for inactive licensees, with the additional amounts generated by the fee increases only available for the Client Security Fund. Section 6140.55 is amended, until January 1, 2025, to authorize the Board to allocate any excess funds not needed for the Client Security Fund to the State Bar’s general fund. The funds for the State Bar’s general fund must first be used to cover salaries and benefits of employees in bargaining units following a memorandum of understanding agreed to by the State Bar.

Section 6145.1 is added to require the Bar to report how it would use the revenues generated by the annual license fee increases for both active and inactive licensees. This report would include the Bar’s calculation of fee increases necessary to maintain existing operations and service levels and all programs and activities that require additional funding. The Bar would submit the report to the Board of Trustees, the California Supreme Court Chief Justice, and the Assembly and Senate Judiciary Committees by April 1, 2024.

SB 40 also amended subsection 6011(b), which establishes the term length for the Bar’s Executive Director at four years, renewable for additional four-year terms, effective on January 1, 2024. The Executive Director’s previous term length was established by contract with the Board. The Executive Director must serve at the pleasure of the Board and must not engage in private practice. The State Bar must report to the Senate Committee on Rules and the Senate and Assembly Judiciary Committees within seven days of the dismissal or hiring of an Executive Director, and the position must be confirmed by the Senate. Similarly, amendments to subsection 6021(b) extended the Board of Trustees Chair and Vice Chair terms from one to two years and moved up the date of assumption of duties to the September meeting following the appointment.


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