Unpublished Disposition, 887 F.2d 1089 (9th Cir. 1989)

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U.S. Court of Appeals for the Ninth Circuit - 887 F.2d 1089 (9th Cir. 1989)

Glenn D. RAMIREZ, Plaintiff-Appellant,v.OREGON STATE BAR, Oregon State Bar Professional LiabilityFund, and Does 1 through 100, Defendants-Appellees.

No. 88-3972.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 14, 1989.Decided Oct. 3, 1989.

Before PREGERSON, TROTT and RYMER, Circuit Judges.


MEMORANDUM* 

Glenn D. Ramirez ("Ramirez") appeals pro se from the district court's order granting summary judgment in favor of the Oregon State Bar ("the Bar") and the Oregon State Bar Professional Liability Fund ("the Fund"). Ramirez argues that: (1) Or.Rev.Stat. Sec. 9.080(2) (a), which requires all active members of the Bar whose principal offices are in Oregon to carry malpractice insurance issued by the Fund, violates the First, Fifth, and Fourteenth Amendments of the United States Constitution; (2) Or.Rev.Stat. Sec. 9.080(2) (a) impermissibly restrains trade in violation of the Sherman Antitrust Act, 15 U.S.C. § 1 (1982); and (3) by requiring that Ramirez purchase malpractice insurance from the fund, appellees have violated the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-1968. We affirm the district court.

Ramirez is a member of the Bar. Pursuant to Or.Rev.Stat. Sec. 9.080(2) (a),1  "all active members of the Bar engaged in the private practice of law whose principal offices are in Oregon" are required to carry professional liability insurance issued by the Fund. Section 9.080(2) (b) provides that

an attorney is not engaged in the private practice of law if the attorney is a full time employee of a corporation ..., the state, an agency or department thereof, a county, city, special district or any other public or municipal corporation or any instrumentality thereof.

Or.Rev.Stat. Sec. 9.080(2) (b) (1987).

In the district court's view, appellant's failure to explain how the statute operates to interfere with his right of free speech or his right to petition for redress of grievances warranted summary judgment in appellees' favor. The district court further held that appellant had failed to demonstrate how the mandatory malpractice provision operates to deprive him of property without due process of law. The court also concluded that the legislative classifications set forth in the statute are rationally related to a valid state objective and therefore do not violate the Equal Protection Clause of the Fourteenth Amendment. Finally, the court held that the statute is exempt from the antitrust laws by virtue of the state action doctrine and that appellant's RICO claim is "absolutely frivolous." We review de novo a grant of summary judgment. California Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir. 1987), cert. denied, --- U.S. ----, 108 S. Ct. 698, 98 L. Ed. 2d 650 (1988).

Although fashioned as a single claim for relief, appellant's first claim actually consists of three claims: (1) the statute impermissibly discriminates against appellant in violation of the Equal Protection Clause of the Fourteenth Amendment; (2) the statute deprives appellant of property without due process; (3) the statute abridges appellant's right of free speech. We deal with each claim in turn.

Equal Protection

Appellant argues that the statute violates the equal protection clause of the fourteenth amendment because it discriminates against a certain class of lawyers: those engaged in "the private practice of law." A legislative classification based on the nature and status of an attorney's clientele/employer neither infringes on a fundamental right, see Lupert v. California State Bar, 761 F.2d 1325, 1327, n. 2 (9th Cir.) (discrimination based on whether law student attends accredited or unaccredited law school does not infringe upon fundamental right), cert. denied, 474 U.S. 916, 106 S. Ct. 241, 88 L. Ed. 2d 251 (1985); Edelstein v. Wilentz, 812 F.2d 128, 132 (3rd Cir. 1987) (no fundamental right to practice law), nor discriminates against a suspect class. Accordingly, the statute is subjected to rational basis scrutiny. Massachusetts Board of Retirement v. Murgia, 427 U.S. 307, 96 S. Ct. 2562, 49 L. Ed. 2d 520 (1976). We have also noted that "(t)he Supreme Court is extremely deferential to legislative classifications in actions challenging regulation of licensed professions." Lupert, 761 F.2d at 1328 (citing Williamson v. Lee Optical, 348 U.S. 483, 487-489, 75 S. Ct. 461, 99 L. Ed. 563 (1955)).

The application of the statute solely to attorneys engaged in private practice is rationally related to the harm the legislature sought to remedy: namely, protecting public litigants from attorneys who commit malpractice. The exemption for attorneys employed by governmental entities or corporations reflects a logical nexus between the class of persons the statute seeks to protect and those members of the Bar who might be in a position to cause harm.

There is also no support for appellant's claim that the additional economic burden imposed on him constitutes a violation of the equal protection clause. Whatever additional costs may be imposed on appellant by operation of the statute are undoubtedly passed along to his clients. The state may rationally conclude that the benefits which accrue from ensuring that attorneys have malpractice insurance coverage outweigh whatever additional costs of legal representation the statute may create. See Person v. Assn. of Bar of City of New York, 554 F.2d 534, 538-39 (2d Cir.) (New York legislature could rationally find that benefits accruing from state bar disciplinary rule prohibiting contingent expert fee arrangements outweigh obstacles to financing litigation), cert. denied, 434 U.S. 924, 98 S. Ct. 403, 54 L. Ed. 2d 282 (1977).

Due Process

Appellant also failed to come forward with any evidence in support of his claim that the statute violates his right to due process of law. The statute does not interfere with appellant's ability to practice law and, as already noted, is rationally related to the state's interest in protecting its citizens from attorney malpractice.

First Amendment

The district court also correctly found that appellant had failed to come forward with any evidence in support of his claim that the statute operates to interfere with his right of free speech or his right to petition for redress of grievances. Ramirez does not explain how the statute "would chill an attorney's speech in the context of his or her professional conduct." Edelstein, 812 F.2d at 133 (rejecting attorney's First Amendment challenge to New Jersey rule granting immunity to ethics grievants).

As we recently decided, the statute withstands appellant's antitrust challenge. See Hass v. Oregon State Bar, No. 87-3996 (9th Cir. August 30, 1989). We agree with the district court's conclusion that appellant's RICO claim is "absolutely frivolous."

Accordingly, we affirm the district court's order. Each side to bear its own costs on appeal.

 *

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3

 1

Hass v. Oregon State Bar, No. 87-3996, (9th Cir. August 30, 1989), a related case, traced the evolution of Sec. 9.080: In 1977, exercising its delegated authority, the Board [of directors of the State Bar] passed a resolution, effective July 1, 1978, requiring all Oregon-based attorneys to carry malpractice coverage with aggregate limits of not less than $100,000 [subsequently raised to $300,000]. The resolution also established the fund contemplated in Sec. 9.080(2) (a), which the Board denominated [the fund]. The resolution further provided that the required malpractice coverage 'for all active members in the private practice of law, with the exception of patent attorneys, shall be obtained through the Fund

Pursuant to the foregoing resolution, Oregon-based attorneys have been required, since 1978, to participate in the Fund, and the Fund has provided such attorneys with legal malpractice coverage. An Oregon-based attorney's failure to participate in the Fund results in suspension from membership in the Bar.

Id. at 10309-10. (emphasis in original).