11-1-10NASP-Cases-Amicus-November56323442 by gegeshandong


									                                     The Bar Associations

       This year two state bar associations have been actively promoting anti-
subrogation measures. The two state bars are Ohio and Florida. Generally, we see anti-
subrogation activity undertaken in the legislature, not through a state bar association.
Although unique in their approach, the bar associations efforts are an attempt to curtail
subrogation recoveries. Ohio has been studying anti-subrogation proposals for a few
years and continued their efforts in 2010. Florida is new to the arena, having passed an
amendment to a Bar Rule in July 2010. The Bar Rule will not become effective until
approved by the Florida Supreme Court.


        The Ohio State Bar Association (OSBA) took up an anti-subrogation bill on the
Friday after last year’s conference in Colorado Springs. The OSBA Board of Governors
rejected support of the bill to ban all subrogation or to adopt “made whole” and “common
fund” doctrines into statute. However, the OSBA did create a new committee to study
subrogation rights and perceived problems with the process in Ohio. This committee was
comprised of 4 personal injury attorneys, 4 insurance representatives (2 insurance defense
attorneys, 1 insurance regulatory attorney & 1 part time subrogation with insurance
defense attorney). The committee has conducted multiple hearings and inquiry into
subrogation rights in Ohio.

       On September 14, 2010 the Committee held a final hearing on the subrogation
issue. Daran Kiefer, an attorney with Kreiner & Peters and Chair of the Amicus
Committee, testified on behalf of NASP at the hearing. The end result was a split vote, 4
to 4. The Chair reported the Special Committee was unable to reach a decision and
concluded their handling. However, other OSBA Committees are still exploring anti-
subrogation proposals. Expect to see more from the OSBA on this matter.


         The Florida Bar Association (FBA) created a special committee to study a rule
change to Bar Rule 4-1.5 by adding a new sub section (E) which allows a lawyer to refer
out settlement of the subrogation resolution to another firm or attorney to resolve the
matter and charge an additional fee. This would result in the injured party paying one fee
to their attorney on the entire settlement and then paying a second fee to a new firm to
reduce the subrogation claim.
         The proposed new section (E) provides as follows:

               “The lawyers shall include in the contract an explanation of the scope
               of any subrogation or lien resolution services the lawyer will undertake
               at the conclusion of the primary matter. The lawyer shall not charge
               additional fees for handling lien resolution services if those additional
               fees, when combined with the lawyer’s fees for handling the primary
              claim, would exceed the contingent fee schedule set forth in this
              subdivision. If extraordinary subrogation or lien resolution services are
              handled by others outside the primary lawyer’s firm who will charge
              additional attorney’s fees or costs to the client, these services shall
              only be provided after obtaining the client’s informed written consent
              to the additional fees or costs. Any additional fees or costs charged by
              the other lawyers involved in the subrogation or lien resolution
              services must separately comply with the provision of Rules 4-1.5(a)
              through 4-1.5(e), and if the fees are contingent on the outcome of the
              lien resolution, the lien or subrogation resolution fees on their own
              must also comply with Rule 4-1.5(f).”

         The proposed change really provides an incentive for the initial attorney not to
settle the subrogation claim. It creates an entire segment of the bar association whose
goal it is to reduce or eliminate subrogated interests. This proposed rule changed passed
the FBA and is headed to the Supreme Court of Florida for comment. The Rule will not
become effective until approved the Florida Supreme Court. On October 15, 2010 the
FBA petitioned the Florida Supreme Court to amend Rule 4-1.5 (f). The amendment was
included in a petition acknowledging consideration and contemplation by the Florida
Supreme Court is required prior to approval.

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