MJP Transcripts

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6 SUPREME COURT OF NEVADA
7 COMMISSION ON MULTIJURISDICTIONAL PRACTICE
8 PUBLIC HEARING
9 Wednesday, October 3, 2001
10 National Judicial College
11 Reno, Nevada
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REPORTED BY: SUSAN E. THOMAS, CCR #655
23 Computer-Aided Transcription
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APPEARANCES:
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THOMAS R. C. WILSON II, Chairman
3 MARGO PISCEVICH
HON. RONALD D. PARRAGUIRRE
4 BRIDGET ROBB PECK
MATTHEW W. ADDISON
5 HON. JACK B. AMES
WILLIAM A. TURNER
6 JOHN P. SCHIEGELMILCH
JOHN A. CURTAS
7 M. ANN MORGAN
JAMES W. HARDESTY
8 HON. NANCY A. BECKER
JOHN H. MOWBRAY
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1 Reno, Nevada; Wednesday, October 3, 2001; 9:00 a.m.
2 -oOo-
3 MR. WILSON: Why don't we get started. It's a bit
4 after 9:00. As you all know, we're here for the Supreme Court
5 Commission on multijurisdictional practice, take comment and
6 have some discussion and try and get some insight and guidance
7 and inspiration to ultimately collect the comments and present
8 a report to the Supreme Court of some value, we hope.
9 But let me ask each of the panel members to introduce
10 themselves. I'm Spike Wilson, I was asked to chair the
11 committee. And if everybody on the panel will please
12 introduce themselves, then we'll go forward.
13 MS. BECKER: I'm Nancy Becker, sort of representing the
14 state at large.
15 MR. PARRAGUIRRE: I'm Ron Parraguirre from Las Vegas.
16 MR. MOWBRAY: John Mowbray from Las Vegas, also
17 Henderson, Carson City and a little bit of Reno.
18 MS. PECK: Bridget Peck, Reno.
19 MR. ADDISON: Matt Addison from Reno.
20 MR. AMES: Jack Ames from Elko.
21 MR. TURNER: Bill Turner from Las Vegas and a little
22 bit of Henderson.
23 MR. SCHIEGELMILCH: John Schiegelmilch from Yerington.
24 MR. CURTAS: John Curtas from Las Vegas.

1 MS. MORGAN: Ann Morgan from Reno.
2 MR. WILSON: We've scheduled three public hearings,
3 this being the third. We've had two, one in Elko, we had one
4 in Las Vegas last week with an extensive amount of testimony
5 from a lot of people. This is our last hearing and following
6 this one we're going to deliberate and try to make a, develop
7 a report for the Supreme Court.
8 Let's take the speakers in any order that you wish to
9 appear. I know Ross indicated he's got a deadline down in
10 Carson. A hot client apparently; is that correct?
11 MR. DE LIPKAU: That's right, sir.
12 MR. WILSON: If there's no objection, why don't we take
13 your testimony and then we can let you go.
14 MR. DE LIPKAU: Okay, thank you. For the record, my
15 name is Ross de Lipkau. I'm an attorney in Reno. By way of
16 background, I have practiced primarily in the field of water
17 rights my entire career. I've had many, many administrative
18 hearings before the state engineer, probably in the
19 neighborhood of 100. Over the years I have noticed an ever
20 increasing number of out-of-state attorneys who appear before
21 the state engineer and, in my opinion, practice law before the
22 state engineer in the identical fashion as do I.
23 I am, perhaps, somewhat to either blame or place credit
24 upon for starting this process. In May, on May 25th of this

1 year I wrote Mr. Bayer of the state bar and requested answers
2 to certain questions. I enclosed a copy of the state
3 engineers' practice and procedure in protest hearings before
4 the state engineer. In essence, I asked whether out-of-state
5 attorneys not licensed to practice law in Nevada not
6 representing federal agencies were practicing law in the
7 appearance before the state engineer.
8 The short answer, which came back June 4th, was yes,
9 out-of-state attorneys who are appearing before the state
10 engineer on behalf of a protestant or the applicant were in
11 fact practicing law. Shortly thereafter, the state engineer
12 issued a ruling which barred out-of-state lawyers of the
13 non-governmental type from practicing before the state
14 engineer unless they had local counsel. I was recently
15 involved in a, call it a two-week hearing, before the state
16 engineer. When that very instance arose, the out-of-state
17 counsel simply hired a local -- meaning Carson City
18 attorney -- who sat for two weeks and didn't open his mouth.
19 So in my opinion, and it is my request, that this
20 committee recommend to the supreme court that it issue an
21 order prohibiting out-of-state attorneys from practicing
22 before the Nevada state engineer, and for that matter, all
23 agencies of the Department of Conservation unless they're
24 accompanied by a local duly licensed attorney.

1 Any questions?
2 MR. WILSON: Ross, do you know whether the state
3 agencies in general have any rules with respect to appearances
4 by attorneys and qualifications?
5 MR. DE LIPKAU: To the best of my knowledge, the
6 Department of Conservation only has the state engineer's
7 recent ruling -- recent meaning the last several months. They
8 will discuss that, that ruling. The division of environmental
9 protection, I am totally unaware of. I know they have a, I'll
10 say a special streamlined procedure for appeals to the
11 environmental commission. I think appeals to the
12 environmental commission should be in the same category as
13 administrative hearings before the state engineer.
14 MR. WILSON: Presently they don't handle it?
15 MR. DE LIPKAU: Not that I'm aware of, no. I've never
16 been confronted with an out-of-state attorney in disputed
17 matters before the environmental commission.
18 MR. MOWBRAY: Ross, can I ask you a question? Assuming
19 that the practice is considered the practice of law, would you
20 be proposing an extension of SC -- Supreme Court rule 42
21 providing the pro hac vice mechanism for appearances before
22 the different state agencies, similar to what exists now
23 before the courts of Nevada?
24 MR. DE LIPKAU: I'm not familiar with 42. I can't

1 answer the question.
2 MR. MOWBRAY: There's a rule that will allow
3 out-of-state counsel to file an application to move to be
4 admitted on a case by case basis, and there are provisions
5 that the out-of-state counsel does have to associate with
6 local counsel. And I think the rule is articulated that more
7 than five appearances in a three-year period would be
8 considered excessive, along those lines.
9 So there's not a real bright line but there's a
10 presumption that if you were to appear on a continuous basis
11 that you would be -- it wouldn't be a proper mechanism to use
12 that rule to gain admission. And the alternative would be to
13 sit for a Nevada bar exam and become a Nevada lawyer.
14 MR. DE LIPKAU: I prefer he or she sit for the Nevada
15 bar exam. I'm aware of that rule where out-of-state lawyers
16 are authorized to practice before, let's say, the district
17 courts on a case by case method. I would have no object if
18 the same procedure were utilized for administrative hearings.
19 MR. MOWBRAY: Thank you.
20 MR. WILSON: You're saying that there should be no
21 substantive difference between an appearance in district
22 court --
23 MR. DE LIPKAU: Absolutely not.
24 MR. WILSON: -- and an appearance before a state

1 administrative or regulatory agency?
2 MR. DE LIPKAU: That's exactly what I'm saying. In
3 fact, before hearings before the state engineer, I think the
4 state engineer hearings are much more important than the
5 court -- no offense to the judges -- because frequently, quite
6 frequently the decision made by the state engineer is a
7 hydrology-type question. It is a question that is decided by
8 him, supposedly, within his field of expertise. That decision
9 is normally not disturbed on appeal; however, the exception is
10 if he renders a decision based on law, then it's, of course,
11 de novo. But generally speaking, they're factual decisions
12 within the state engineer's field of expertise for which the
13 courts do not substitute their decisions. So basically, it
14 all takes place at the state engineer's office as contrasted
15 to the courtroom.
16 MR. WILSON: Do you have any sense of the degree of
17 practice before other state agencies or --
18 MR. DE LIPKAU: No, I don't. I'm pretty well limited
19 to the water rights area.
20 MS. MORGAN: Can I ask a question?
21 MR. WILSON: Yes.
22 MS. MORGAN: Ross, in your experience before for state
23 engineer where you've had an out-of-state attorney, have you
24 had any concerns that they did not have the expertise to

1 appear there?
2 MR. DE LIPKAU: Sometimes. Generally they're saying:
3 State engineer, here's how they do it in Utah or Wyoming, and
4 here's six western states, for example, that shift the burden
5 of persuasion or the burden of proof on an allegation of
6 forfeiture. It comes up all the time and to me it's quite
7 clear in Nevada, and affirmed by the Ninth Circuit, that this
8 is the law in Nevada. The burden does not shift. It's
9 brought up time and time again.
10 I've noticed people not misquoting law, but putting a
11 spin on it that: Wait a second, that's just not the way it
12 reads. That's just not the way it's done. I'm not calling
13 them incompetent, I'm saying they're inexperienced in some
14 areas of Nevada law and state engineer procedure with an
15 emphasis on here's how you should do it because my home state
16 does it this way.
17 MR. HARDESTY: That operates as a disservice, then, to
18 their client and an obstruction to the process?
19 MR. DE LIPKAU: I would say so, yes.
20 MR. TURNER: Do you think with the limitation that
21 you're suggesting that they all be required to take the Nevada
22 bar, does in fact harm the clients with the inability to find
23 representation here?
24 MR. DE LIPKAU: No. I think that there are enough

1 lawyers here. I don't know that I want to be so strict as to
2 say that an out-of-state lawyer can't go anywhere near the
3 state engineer's office. I think on perhaps a case by case
4 basis under 42, if accompanied by Nevada counsel, who's
5 responsible for the conduct of the out-of-state counsel, is
6 probably acceptable in the same fashion as an out-of-state
7 counsel trying a case before Judge Hardesty, for example.
8 MR. TURNER: Are the administrative procedures somewhat
9 different than the traditional procedures, that is more
10 relaxed as to findings of fact and law, that is it's more a
11 fact finding type of investigation?
12 MR. DE LIPKAU: In the most recent one I did, this
13 two-week hearing, I would say it is almost identical to a
14 courtroom before Judge Hardesty. The statute 533 states that
15 technical rules of evidence are not to be applied; however,
16 with half a dozen lawyers and an experienced lawyer hearing
17 officer, technical rules of evidence do in fact apply.
18 So I treat an administrative hearing in the identical
19 fashion as I would treat a regular civil trial over a
20 promissory note, deed of trust dispute. The witnesses are
21 under oath, the evidence is premarked, the witnesses discuss
22 the evidence, cross-examination applies, the breadth of which
23 is determined by the hearing officer as to how far the counsel
24 can go.

1 MR. HARDESTY: Mr. Chairman, I know Ross indicated that
2 he practices primarily in the water law area, but the question
3 about other agencies raises an interesting spectra. What
4 happens in gaming, Nevada tax commission? I would rather
5 imagine there is a lot of out-of-state counsel that appear
6 before the Nevada State Gaming Commission. What would be the
7 impact of a Rule 42 requirement or perhaps having to take the
8 Nevada bar? I'm not sure.
9 MS. BECKER: As to the Gaming Commission, the gaming
10 board, it is primarily in-state counsel, not out-of-state
11 counsel. But it is true before the PSC that there are a lot
12 of out-of-state counsel. When we get the petitions for
13 judicial review or when we see them coming up to the courts,
14 that's when you suddenly see local counsel coming in and once
15 you read the records there are no counsel added. And I know
16 that former Judge Mendoza indicated that there were a lot of
17 out-of-state counsel because they're brought in for some of
18 these regulatory proceedings by the utility person.
19 MR. HARDESTY: I'm wondering, Mr. Chairman, I know the
20 state bar staff is overburdened by the work we put on them
21 anyway, but I'm wondering if it wouldn't be a good idea to ask
22 the various AGs to comment about the impact to their
23 perspective agencies. PSC is a really good example.
24 MR. WILSON: Yeah, we ought to survey it.

1 MR. HARDESTY: And see what that would do.
2 MR. WILSON: Yeah, I don't think we have a sense of the
3 volume.
4 MR. HARDESTY: I think Ross is correct, in his area
5 it's a big issue and I suspect it could be in others, but I
6 don't know the impact down the stream of doing it in other
7 agencies.
8 MR. WILSON: I had tried to do an informal survey and I
9 didn't get a lot of information back on the level of -- what I
10 did was called the attorney general and she referred me to the
11 deputy and the deputy, I asked her to survey it and we didn't
12 really get much back as to any kind of volume or level of
13 practice. But I agree, you've got to believe that there's a
14 fair amount of practice both before the Public Service
15 Commission and the Gaming Control Board, Gaming Commission. I
16 don't know about the Tax Commission.
17 I got, generally, a blanket negative but I think we
18 ought to test that and see how many cases they have and what
19 the frequency of non-Nevada counsel are and whether they're
20 appearing on a pro hac basis or otherwise and at least get an
21 understanding of the terrain.
22 MR. DE LIPKAU: Okay.
23 MR. WILSON: Any other questions?
24 MS. MORGAN: In essence you were relating the

1 out-of-state attorney brought in a local Carson City attorney
2 who never said anything. Did you believe that the expertise
3 improved by virtue of having the local attorney sitting there?
4 MR. DE LIPKAU: No, he didn't do anything.
5 MS. MORGAN: If that's the case, how do you think that
6 Rule 42 might be of assistance?
7 MR. DE LIPKAU: Don't really know. I think we're faced
8 with a situation that you can't practice before the state
9 engineer unless you're licensed. And stepping one step back
10 from there is: Okay, let the out-of-state attorney show up on
11 a case-by-case method, maybe five within three years or three
12 within five years, whatever the rule is, having local counsel.
13 Local counsel need not know where the state engineer's office
14 is, he or she would just have a Nevada license.
15 So I don't know where to draw the line. Obviously I
16 would like to draw it as strict as I could, but then we get
17 into constitutional arguments, I suppose, if you can't
18 practice before any state agency unless you have a Nevada
19 license. The state engineer's office, some of the hearings
20 range from the incredibly sophisticated with half a dozen
21 experienced lawyers to two farmers representing themselves
22 with absolutely no expertise, and those may be more difficult
23 for the state engineer to try to have some rule of order, some
24 questioning. And what happens, one farmer tries to ask

1 another farmer a question and it turns out to be a speech.
2 And -- okay.
3 MR. WILSON: Some lawyers do that.
4 MR. DE LIPKAU: Well, that's true.
5 MR. WILSON: But it's not limited to the farmer.
6 MR. DE LIPKAU: So I don't know where to draw the line,
7 but I believe my conclusion is it should be strictly drawn to
8 prohibit, where possible, out-of-state people, attorneys, from
9 abusing the Nevada process.
10 MS. PECK: Mr. de Lipkau, how many lawyers would you
11 say in Nevada practice in your area?
12 MR. DE LIPKAU: Practice in what?
13 MS. PECK: Practice in your area.
14 MR. DE LIPKAU: Half a dozen to ten.
15 MS. PECK: Have you ever had circumstances where there
16 have been conflicts with someone's representation in their
17 case?
18 MR. DE LIPKAU: Conflicts of interest?
19 MS. PECK: Uh-huh.
20 MR. DE LIPKAU: All the time.
21 MS. PECK: So right now, what I'm hearing, is that the
22 body of lawyers who practice in this specialized area may not
23 be able to serve all the clients who would need representation
24 in Nevada?

1 MR. DE LIPKAU: I don't believe that's the case. I
2 think there are enough lawyers, water lawyers, to go around.
3 Obviously they range from very good to just learning but I am
4 unaware of any instance where the interests of a claimant,
5 water right holder, were lost by reason of the claimant not
6 being able to obtain the services of a licensed Nevada
7 attorney with some knowledge in water rights. And again, I've
8 seen very good and not so very good at administrative
9 hearings.
10 MR. TURNER: How often would you say that out-of-state
11 attorneys appear in water rights hearings?
12 MR. DE LIPKAU: I think it's becoming ever more
13 increasing. I think the state engineer or hearing officer,
14 Susan Joseph-Taylor, could answer that question a lot more,
15 but I have noticed more and more.
16 MR. TURNER: If you had a limitation, three to five
17 times in a five-year period, would that effectively preclude
18 their practice because they appear more often than that?
19 MR. DE LIPKAU: Some of them, yes.
20 MR. TURNER: So the client could possibly be prejudiced
21 by not being able to find enough sophistication in the area
22 they need?
23 MR. DE LIPKAU: I don't think so.
24 MR. WILSON: Back to the question of conflicts, you

1 indicated that was often the case but can you quantify that?
2 Is the frequency of conflicts among water practitioners, and
3 there are not many of them, is the frequency rate of
4 conflicts, does that limit the number of lawyers available in
5 Nevada who are licensed to practice here represent others in a
6 contested matter, do you think?
7 MR. DE LIPKAU: I don't think so. You get into it, or
8 I get into it -- and I'll say the Las Vegas sense. Working
9 with the Las Vegas Valley Water District, the SNWA, that
10 entity basically controls the water in Clark County.
11 MR. CURTAS: The Southern Nevada Water Authority.
12 MR. DE LIPKAU: Right, the Southern Nevada Water
13 Authority. That's over broad. Now, some entity outside of
14 the Las Vegas valley has a water right issue, it normally is
15 going to involve the water district or SNWA, which in my
16 particular case would conflict me out. It's happened a few
17 times and it's just a fact of life. People that practice on
18 the Carson River, for example, sometimes find themselves -- if
19 there's farmer A versus farmer B on the same segment of the
20 Carson River, in that case that attorney would be conflicted
21 out. But with, I'll say, the Northern Nevada lawyers, I have
22 found no instance where I'll say an experienced lawyer was
23 discharged by reason of a conflict and the alternate was
24 incapable of handling that person. I think there are enough

1 experienced water lawyers to go around.
2 MR. WILSON: Where do most of the out-of-state water
3 lawyers come from?
4 MR. DE LIPKAU: I would say Utah, some Denver. I've
5 basically had no problem with California. We have one in
6 Seattle who's representing a tribe in Southern Nevada who
7 appears at all kinds of hearings and things. And again, Ms.
8 Taylor can describe that.
9 MR. WILSON: Any other questions? Ross, thank you. We
10 appreciate you coming.
11 MR. DE LIPKAU: Well, thank you very much for having
12 me. Goodbye.
13 MR. WILSON: We don't have any particular order. Who
14 wants to go next? Why don't you both come together. The
15 seating is a little awkward here and I apologize for that.
16 MR. TURNIPSEED: Mr. Chairman, members of the
17 committee, my name is Mike Turnipseed, former state engineer
18 now director of the Department of Conservation and Natural
19 Resources. I am not a lawyer.
20 MR. WILSON: That would be an advantage some days.
21 MR. TURNIPSEED: I am a licensed civil engineer in the
22 states of Nevada and Utah. Now, Ross was a prior engineer and
23 went to law. I think he went in the wrong direction in his
24 career path, but nonetheless I've associated with Ross for a

1 long, long time, been in water resources management for a
2 little over 30 years, held hearings in the state of Utah, held
3 hearings when I was chief of the surface water section. I was
4 state engineer for ten and a half years, held many hearings
5 with myself -- I mean, by myself. Ms. Taylor came on board, I
6 don't know, '94?
7 MS. JOSEPH-TAYLOR: With the agency.
8 MR. TURNIPSEED: With the agency in '94. She was our
9 deputy AG before that. I wrote a letter to the state bar
10 prior to coming here today and you asked about some of the
11 numbers, and some of these I got from Susan. She says out of
12 the last 17 hearings held by the Division of Water Resources,
13 seven had had unlicensed lawyers representing clients and
14 there have been instances where more than one out-of-state,
15 unlicensed lawyer participated in a particular hearing.
16 This means that about 40 percent out of the last group
17 of hearings have had unlicensed lawyers representing clients.
18 The state engineer's office is a quasi-judicial office. It's
19 not to be interfered with. That is, the decisions are not to
20 be interfered with by the governor or anybody else in the
21 executive branch. There is no appellate procedure in the
22 executive branch of government. The state engineering
23 decisions are appealed only in 533 450 directly to the
24 district court, or in the case of the Carson or Truckee River

1 or Walker River to the federal court, and then, of course, the
2 judicial process takes it from there.
3 Ross said it correctly, the witnesses are sworn, some
4 are classified as experts or recognized as experts in their
5 field -- subject to objection, of course. Exhibits are
6 stamped for identification, subject to verification and
7 sufficient background on relevancy, et cetera, and then
8 they're either admitted into the record or not admitted into
9 the record.
10 All of that record, then, goes to the district court or
11 the federal court on appeal. There is no de novo, per se, in
12 the appropriation proceeding. There is an opportunity for a
13 judge to conduct a trial de novo in an adjudication procedure.
14 An adjudication procedure, if you're not familiar with that,
15 is a statutory process to bring all pre-statutory water rights
16 up-to-date, naming the proper owner, point of diversion, place
17 of use, extended use, et cetera, et cetera, et cetera.
18 Those are a lot different than the appropriation
19 procedure, and out of -- when I left the state engineer's
20 office a year ago last month, I left the new state engineer
21 with about 65 cases, appellate cases, either before district
22 court, federal court, ninth circuit or state supreme court.
23 We had not had one -- or I did not have one that went to the
24 U.S. Supreme Court, although we may have one coming up pretty

1 soon in adjudication.
2 MR. WILSON: What percentage does that represent, can
3 you guess?
4 MR. TURNIPSEED: Sixty-five cases?
5 MR. WILSON: No, of the ones up for judicial review of
6 some kind.
7 MR. TURNIPSEED: Oh, ten to fifteen percent.
8 MR. WILSON: Okay.
9 MR. TURNIPSEED: So I conducted my hearing much like
10 Judge Hardesty would in his courtroom; fair amount of decorum,
11 they're all recorded by a certified court reporter, that
12 record is, transcript of that record goes up to the court as
13 well. So in my view there's no difference between one of the
14 hearings that I held and the hearings that Judge Hardesty
15 would hold.
16 The, the -- like I said, I'm licensed in Utah and
17 Nevada and I know the licensing board in those two states
18 would not allow the practice of engineering in that state
19 without being properly licensed. I'm aware of one instance
20 where an out-of-state engineer was at a conference and handing
21 out business cards and our professional engineers board viewed
22 that as preparatory, at least, to practicing engineering in
23 this state.
24 The rest of the letter is pretty explanatory. I, I

1 don't know what else I can add.
2 MR. WILSON: Let me ask a question -- and if anybody
3 has a question, I can't see behind me. Am I correct in
4 understanding you to say that to require an engineer to appear
5 before the state engineer to appear at a hearing, you require
6 that the engineer hold a Nevada license to do so?
7 MR. TURNIPSEED: Absolutely. Generally that person
8 would be called as an expert witness. There was a prior
9 question on, on the frequency. I guess Ross said more and
10 more he sees out-of-state lawyers. The state engineer, today,
11 has 15 applications by major energy companies to build power
12 plants just on the I-15 corridor between Mesquite and Primm,
13 and many others around the northern part of Nevada. And of
14 course those big corporations have their corporate counsel and
15 some will associate with local counsel, some will not. When I
16 was state engineer I adopted as a rule that they had to at
17 least associate with local counsel. And as Ross said, many
18 times they wouldn't even be in the room.
19 The new state engineer, Hugh Richey, has gone further
20 than that and said that they at least have to be in the room
21 if they're going to associate with local counsel. And I
22 don't, I didn't particularly care when I was state engineer
23 who was doing the examination and cross-examination, nor who
24 was preparing the briefs, if there are questions of law -- and

1 I would always require a post-hearing brief and have both
2 sides, applicant and protester, prepare a brief on the law of
3 that issue, and sometimes those get pretty lengthy and they
4 would be pretty abstract. But at any rate, I didn't
5 particularly care whether it was the associate that was
6 preparing the briefs our the counsel, out-of-state counsel.
7 MR. WILSON: What was your practice with respect to
8 counsel admitted to practice here, counsel from out-of-state,
9 and whether that counsel was simply appearing on his or her
10 own or in association with the pro hac vice with Nevada
11 counsel?
12 MR. TURNIPSEED: I didn't particularly care as long as
13 I got the evidence I needed to make the decision.
14 MR. WILSON: You're concerned with the evidence and
15 engineering and not so much the lawyer?
16 MR. TURNIPSEED: That's correct.
17 MR. WILSON: But do you have a view as to whether or
18 not the lawyer ought to be admitted as a Nevada lawyer or
19 ought to be associated the a Nevada lawyer or -- under the pro
20 hac vice?
21 MR. TURNIPSEED: I think there are plenty of qualified
22 Nevada lawyers that have anywhere from a minimal understanding
23 of water law to a very, very good understanding of the water
24 law. In the case of Mr. de Lipkau, I've had him against me,

1 I've had him on my side, we've been in the same litigation. I
2 would much prefer to have him on my side than against me, but
3 at any rate there are -- Susan was going to give out some
4 names of lawyers that she knows of that are licensed to
5 practice law in Nevada and do a very good job in our hearings.
6 MR. WILSON: Let me go back to another one of your
7 points in item -- and that had to do with when you were state
8 engineer. Your requirements with respect to accepting the
9 participation and testimony of expert judgment of the
10 engineer, if I understood you correctly, your practice and
11 policy was to limit that kind of participation to Nevada
12 licensed engineers?
13 MR. TURNIPSEED: That's correct.
14 MR. WILSON: Do you have occasions where you have had
15 an engineer from another state, licensed in another state, not
16 Nevada, offer testimony or judgment or expert testimony and
17 how did you handle that?
18 MR. TURNIPSEED: I did have that occasion, and again,
19 those kinds of, of -- generally they were, they were proposed
20 as an expert witness in a particular field of hydrology or
21 ground water hydrology our hydrogeology or geohydrology -- and
22 whenever I'm amongst the geologists I ask them what the
23 difference is and they never have given me a satisfactory
24 answer -- but geologists are not licensed in this state;

1 however, engineers are. And again, as long as I could get the
2 evidence that I needed to make a decision, I didn't consider
3 just their expertise as practicing engineering in this state.
4 If they were, for instance, hiring out as a consultant to one
5 of these, say, energy companies or something like that, I
6 would assume they would have to be.
7 MR. WILSON: As an expert witness?
8 MR. TURNIPSEED: As an expert witness, yes.
9 MR. TURNER: Do you think that the experience of
10 out-of-state counsel sometimes brings a water knowledge that
11 perhaps is helpful rather than insulating us to practicing
12 with just local lawyers in front -- in other words, can they
13 enrich the practice before you by bringing other experiences
14 and other law into your hearing room?
15 MR. TURNIPSEED: No, I don't think so. Of course the
16 standard practice of examining the witness, cross-examining
17 the witness, it does help if the lawyer has enough general
18 knowledge about hydrology to ask the proper questions. If,
19 if -- generally I would allow the examination and
20 cross-examination, redirect, recross sometimes, and
21 occasionally we'll hear testimony, if I didn't get the answers
22 that I wanted I would close that portion of the hearing and
23 ask my own questions of the witness, and that testimony was
24 not subject to cross-examination. That sometimes infuriated

1 counsel on either side.
2 But it's up to the applicant or the protestant to
3 prepare his case and bring the case forward and make sure his
4 experts get the proper testimony on the record because that's
5 the only thing that is going to the district court. I can
6 only make a decision based on the record that I have before
7 me.
8 MR. TURNER: Actually, my question really was more
9 directed to law that's in development and practiced
10 historically, and sometimes by bringing in new concepts of law
11 or the idea of how it's practiced in some other state, adds
12 some enrichment to our own practice. Do you think that's a
13 benefit in the sense of legal theories, and even hydrology
14 might be helpful?
15 MR. TURNIPSEED: Well, I would hope that the field of
16 hydrology is pretty universal, not just throughout the country
17 but throughout the world.
18 MR. TURNER: But is the law?
19 MR. TURNIPSEED: But the law is different, obviously,
20 in other states, but I have to make my decisions based on
21 Nevada law. Now, many times in asking for briefs they would
22 cite case law from other states sometimes there was some
23 rationale to apply in Nevada and sometimes it was not,
24 particularly if the law was silent, the Nevada law was silent

1 on that issue or --
2 MR. TURNER: Which it sometimes appears to be.
3 MR. TURNIPSEED: -- or a little gray.
4 MR. SCHIEGELMILCH: If there's -- one of the questions
5 I have is that the administrative agencies all have their own
6 rules regarding conduct in the proceedings and the rule out
7 there for the state engineer, as I understand it, pretty much
8 says you can either be represented by someone called a
9 representative or if it's an attorney who associates with
10 counsel. That's generally a new ruling. If that's the case,
11 why doesn't the state agencies copy their regulations to --
12 not for them to practice? Don't you feel that the agencies
13 have the authority to do that?
14 MR. TURNIPSEED: The regulation that requires a lawyer
15 to be associated -- I mean, either a member of Nevada bar or
16 associate with a member of Nevada bar has been promulgated
17 through the regular regulation procedure. Most recent, I
18 think, was by letter -- that Susan could speak to that with
19 more intelligence -- but it was that the associate had to be
20 in the room.
21 MR. SCHIEGELMILCH: From what I understand, there's
22 always been -- that regulation has been there.
23 MS. JOSEPH-TAYLOR: It's relatively new.
24 MR. SCHIEGELMILCH: When was it adopted?

1 MS. JOSEPH-TAYLOR: I drafted the rules for the state
2 engineer when I became the deputy attorney general in 1993.
3 MR. SCHIEGELMILCH: Okay, but is that just the water
4 agency rule?
5 MS. JOSEPH-TAYLOR: Yes. And it only applies to
6 hearings on protested applications. It does not apply to
7 forfeitures, well-driller hearing, adjudication. Everything
8 else, the legislation required the state engineer to draft the
9 rules, found in chapter 533, and that's all they apply to.
10 MR. TURNIPSEED: And they're published in Freedom
11 Public and this is what they look like.
12 MS. JOSEPH-TAYLOR: Susan Joseph-Taylor for the record.
13 I would like to address a few of your requests.
14 MR. WILSON: Would you, please?
15 MS. JOSEPH-TAYLOR: Yeah. I'm chief of the hearing and
16 adjudication section in the Division of Water Resources. Mr.
17 Mowbray, you asked about Rule 42, pro hac vice?
18 MR. MOWBRAY: Yes.
19 MS. JOSEPH-TAYLOR: I can see the abuse already.
20 They're going to say it's one case. In Nevada you have an
21 adjudication on the Truckee River and you have an adjudication
22 to the Carson River. The Truckee River is called the orditch
23 case, the Carson River is called the Alpine case. In October
24 1995 the court remanded to the state engineer what it called

1 the GGID transfer case. They've been in litigation for about
2 15 years, now. It is actually over three hundred cases in one
3 case under one title. It's three hundred different water
4 right applications. We have lawyers representing -- well, the
5 tribe is represented on all three hundred cases by one lawyer,
6 not licensed in Nevada, who's been practicing here for 30
7 years. About 150 clients were represented by a firm out of
8 San Francisco. So they could say I'm not here on five cases,
9 I'm here on one case. So you're already around that rule.
10 MS. BECKER: How many of the people who are hiring
11 out-of-state counsel are out-of-state clients and therefore
12 they want to keep the same counsel they're familiar with? The
13 second part of my question is: On many of these decrees that
14 you're talking about you have multi-state issues; either the
15 water basins cede beyond state boundaries or the rivers or the
16 tributaries, et cetera, are coming from areas that are not
17 located in the state of Nevada and the people who are
18 appearing in Nevada, because Nevada court may have the decree
19 control, are actually people who live and reside out of state?
20 MS. JOSEPH-TAYLOR: Very few. You can actually answer
21 that question in two ways. The over three hundred cases that
22 were sent back in 1995, those are all farmers in Fallon. Then
23 you go to the adjudication world where we're adjudicating the
24 Owyhee, the Jarbridge and the Bruno Rivers in Northern Nevada.

1 They flow into Idaho and Oregon. But we aren't adjudicating
2 the Idaho and Oregon rights, we're only adjudicating the
3 Nevada rights.
4 In response to another question, I can -- and I've been
5 jotting these down as you've asked your questions. I can tell
6 you about lawyers from Utah, California, Colorado, Washington,
7 New Mexico -- and that was very quickly jotting down a few I
8 saw in the last few years. I actually had a lawyer say to me
9 once -- I was sitting in the Las Vegas Valley Water office
10 with Mike and I asked this lawyer representing an Indian tribe
11 if he was licensed to practice law in the state of Nevada.
12 And he said: It doesn't look like I'm in the state of Nevada,
13 I'm working for an Indian reservation. We were sitting in
14 downtown Las Vegas but this was what I was given.
15 I quickly tried to jot down names of water lawyers I
16 know. I could come up with 23 off the top of my head sitting
17 here. So I disagree with Ross, there are more.
18 MR. WILSON: That's Nevada licensed water lawyers that
19 are qualified to practice in that field, 23?
20 MS. JOSEPH-TAYLOR: Yes, uh-huh. And that was just
21 very quickly going by who I worked with in the last couple of
22 years.
23 We purposely drafted our hearing rules very broad
24 because Ross was right. We have, for example in these GGID

1 hearings, I can think of Mrs. Andre. She came in by herself,
2 I guided her through her case -- which was a little awkward as
3 a protestant -- but she's up against a lawyer, she's
4 representing herself. We have to have that broadness where
5 you can come in and represent yourself, you can have an
6 engineer come in and represent you or you can have a lawyer.
7 But these guys are really practicing law. We are doing
8 enormous questions of forfeiture, abandonment. It keeps going
9 to the federal court because these are decreed streams. The
10 federal court sends them to the administrative agency and then
11 they go back to the federal court. So occasionally -- I know
12 Justice Becker on some of these, occasionally it squeaks
13 through the supreme court -- and they will appear there and
14 local counsel is there. But I can list a couple of hundred
15 cases, easily, in the last couple of years that out-of-state
16 lawyers are practicing. The hearing Ross was just talking
17 about, we had four weeks of hearings this summer and I believe
18 there was one or two out-of-state lawyers in those hearings.
19 MR. WILSON: Why does a party, the employer agency,
20 retain an out-of-state lawyer as opposed to a Nevada lawyer?
21 MS. JOSEPH-TAYLOR: In Indian issues?
22 MR. WILSON: Any, just general.
23 MS. JOSEPH-TAYLOR: Because you're -- I'm just giving
24 examples. In Indian issues you find the best Indian lawyers

1 in the country were trained out of the University of Colorado,
2 some of them are still there, they specialize in that
3 practice. It is an extremely difficult area of the law. I
4 spent a year as a deputy AG studying that area just to try to
5 speak intelligently to these people. It is -- water law is
6 extremely specialized but then you start in federal/state
7 issues, the Indian issues. A novice cannot walk in and
8 adequately represent someone. And I'm not here to say these
9 lawyers are not representing their clients, they're doing a
10 heck of a good job.
11 MR. WILSON: Well, one of the questions we have is:
12 What's in the public interest? And this is not a trade
13 association protecting the market, the question is what should
14 the rule be, what should the law be with respect to the
15 practices, not just in Carson before the administrative
16 agencies. Is there a reason why people with, with interests
17 in this subject in Nevada hire lawyers from out-of-state?
18 MS. JOSEPH-TAYLOR: Not to be flippant, sir, but is
19 there a reason that I have to have a license, then, to
20 practice law here? My job requires it. And that is sort of
21 trade oriented, I guess, but should I be able to let my
22 license lapse and sit as an administrative hearing officer?
23 MR. WILSON: No, but I am interested in what's causing
24 this. What's the reason?

1 MS. JOSEPH-TAYLOR: What's causing all of these lawyers
2 to come in?
3 MR. WILSON: Yeah, and require -- for example, you just
4 eluded a minute ago to an area of your practice which requires
5 a great deal of expertise, much of which you find out-of-state
6 and much of which you find in-state.
7 MS. JOSEPH-TAYLOR: It's here, also. You can take
8 Gordon DePaoli, you can take Greg Walsh, you can take Dale
9 Ferguson, Steve King, Mike Mackedon.
10 MS. BECKER: I think he was referring to the tribal
11 counsel.
12 MS. JOSEPH-TAYLOR: No, I'm saying you can take all of
13 them and they are very well qualified for these issues. I
14 don't necessarily think the clients are being hurt, I'm just
15 seeing very substantial practices and my understanding of the
16 supreme court rules is you maintain a place of business, you
17 get most of your -- have a substantial practice here, you
18 should be licensed here, and that's where my gripe comes from.
19 MR. TURNIPSEED: Let me see if I can give it another
20 shot. I guess my fear is that since the state here does have
21 to rule on the record, I don't know what recourse Joe Citizen,
22 Nevada citizen would have if there were an event where there
23 were malpractice. He can't go to the Nevada bar and have this
24 lawyer's license or his practice scrutinized. He would have

1 to go to the state residence wherever the lawyer is licensed,
2 and I don't even know if they would allow that in a different
3 state.
4 MR. TURNER: But certainly doesn't the client obtain
5 the right to sue them for malpractice?
6 MR. TURNIPSEED: I suppose he does. I don't know what
7 kind of burden the client would carry.
8 MS. BECKER: I think one of the issues, there may be a
9 reason now for dealing with the unauthorized practice before
10 administrative agencies that didn't exist 30 or 40 years ago.
11 I disagree with counsel in terms of it's a real easy issue
12 because there are a number of cases in the United States that
13 have indicated that if an agency allows an individual to have
14 a non-lawyer represent them, as I understand state engineering
15 does, you can have anybody come up and speak for you, that you
16 cannot then say that that person has to be a lawyer licensed
17 in the state of Nevada and that doing so is the unauthorized
18 practice of law, because you can ask for anyone to represent
19 you and speak for you and that person would not be practicing
20 law.
21 And so those cases that are dealt with have made a
22 distinction in administrative agencies because traditionally
23 administrative agencies were intended to be fact finding
24 missions, they were intended to facilitate people being able

1 to present their cases. It wasn't supposed to be adversarial.
2 Now, the rule has changed a lot and therefore that underlying
3 philosophy may no longer be valid and I would like comments
4 with regard to that.
5 MR. TURNIPSEED: Let me see if I can comment on that.
6 I have allowed engineers to represent a client, licensed in
7 the state, and they -- generally I do the questioning if
8 there's opposing counsel then they can do the
9 cross-examination, but I do not let the engineer or surveyor
10 or hydrologist examine or cross-examine the witness. That's
11 purely in the field of law and in my view and it ought to be
12 the lawyers doing the examination and cross-examination.
13 Now, if they just want to get up and give evidence of
14 his report or his expertise, he says: The water flows this
15 way, it will not dry this guy's well up. I'll allow that in
16 but I will do the questioning. And again, allowing the
17 opposing counsel to cross-examine, but I don't allow an
18 engineer or surveyor to do the examination. Or they will
19 oftentimes submit a report stamped as an exhibit, opposing
20 counsel has an opportunity to question on its authenticity, on
21 its relevance, et cetera.
22 Back -- I was going to make another comment. The only
23 deviation that I can think of between our rules of evidence
24 and testimony and what a district judge would have, is in the

1 case of adjudication. Since we're trying to take evidence
2 that existed prior to 1905, I will allow hearsay evidence in
3 journals and people's diaries and things like that. There
4 just aren't that many people left around today that can
5 testify with firsthand knowledge of when a ditch was dug or
6 when a well was drilled prior to 1905.
7 MS. JOSEPH-TAYLOR: I have to respectfully disagree. I
8 just had a hearing where an engineer came in representing a
9 client on a forfeiture matter. He put on the whole case for
10 the town of Minden and our rules did not preclude that. And
11 more in response to your question, Justice Becker, my concern
12 is more of the substantial practice of law, not the occasional
13 come in. It's these people who are making careers in the
14 state, and I believe that violates the supreme court rules.
15 MS. BECKER: I understand that, but part of the issue
16 of the unauthorized practice of law has to deal with equal
17 protection. In other words, in the court system we do not
18 allow individuals to be represented by someone who is a
19 non-lawyer. A corporation must have a lawyer because a person
20 can't speak for a corporation, it's an entity in and of
21 itself. If you are Joe Blow and you want to represent
22 yourself, you can speak but you can't say: Look, I'm not very
23 articulate, I would like my brother or my sister to speak on
24 my behalf.

1 You do allow that in most administrative agencies, and
2 it seems to me that if we're going to propose a rule then we
3 need to weigh -- because I think in order to be constitutional
4 we would have to prohibit all of that representative
5 testimony -- and weighing that, if that is what we wish to do
6 or not wish to do for a public interest standpoint.
7 MR. HARDESTY: What is Ms. Joseph-Taylor's view on
8 that? I know you said they should all be licensed, but --
9 MS. JOSEPH-TAYLOR: I don't necessarily think so, Your
10 Honor. I think I've seen excellent representation by some of
11 these out-of-state lawyers on -- for example, let's take the
12 tribal issues on the Truckee River. If you don't have 30
13 years of institutional memory and have been through all of
14 this, I don't know that you can adequately represent those
15 people.
16 MR. HARDESTY: Well, I've attended hearings in front of
17 Mike and frankly it scares the hell out of me. I mean, it's
18 so complex. It's so complex --
19 MS. JOSEPH-TAYLOR: Yes.
20 MR. HARDESTY: -- that it is an area that almost goes
21 to a point where out-of-state lawyers aren't really the issue,
22 it's extent -- it's background, it's knowledge that's so
23 steeped in the law.
24 MS. JOSEPH-TAYLOR: And Nevada's law is different than

1 Oregon's law and Utah's law.
2 MR. HARDESTY: Sure.
3 MS. JOSEPH-TAYLOR: And in a hearing I just had, I had
4 a lawyer out of Washington who was saying things and I was
5 just shaking my head and I think I said on the record: Then
6 you don't know what Nevada law is. So I have seen that.
7 MR. HARDESTY: But that gets to the point that I think
8 this commission needs to be concerned about. In addition to
9 complexity that you deal with -- I hope Mike doesn't, I hope
10 he stays alive a long, long time, you too -- but in addition
11 to the complexity of the subject matter, you're also dealing
12 with a very sophisticated approach to the way your hearings
13 are conducted. There may be relaxed evidence rules and so
14 forth in some administrative agencies, but not in your shop.
15 MS. JOSEPH-TAYLOR: It's going more towards a trial
16 setting all the time. The hearing I did a couple of weeks
17 ago, I was running eight or nine lawyers at the same time.
18 You have to bring some of that decorum to it or it turns into
19 a circus.
20 MR. HARDESTY: I just think the level of sophistication
21 in your area from a legal standpoint -- the rules you use, the
22 evidence you apply -- kind of dictates maybe we need to look
23 at the use of lawyers and regulated lawyers in Nevada.
24 MS. BECKER: Do you think that the registration

1 procedure we've discussed, the concept that maybe in certain
2 types of areas we don't want to require people to go through a
3 pro hac vice but we might want to require more of a
4 registration so that we can check backgrounds and make sure
5 that they understand that they're subject to the local rules
6 and disciplinary practices and things of that nature. So
7 there's ability to regulate them from a public interest
8 standpoint but not necessarily deprive the public of the
9 ability to hire out-of-state counsel requiring certain
10 regulations. And if you have no immediate response, just
11 think about it.
12 MS. JOSEPH-TAYLOR: Well, I was just trying to think
13 about it because we drafted the rule to associate, and to tell
14 you what, they have associated with people who don't have a
15 clue about water law. It's a body sitting there. I feel sort
16 of foolish but it was our rule. Do we start to enforce it?
17 I've had lawyers who associated with local counsel whose bar
18 licenses are suspended. I had to call and check on them.
19 So the state engineer, State Engineer Richey saying I
20 want them here, I want to see them, I want them in the room,
21 has taken it a step further. It's such a small group but it
22 is expanding, particularly with these power issues, these
23 tribal issues. It's almost exponential right now, and that's
24 part of our concern and part of the reason to associate. I

1 don't think it would hurt, it just brings a degree of respect
2 to the process.
3 MR. TURNIPSEED: Let me go back a few years. When I
4 first came to the state of Nevada we resolved a lot of
5 protested applications by what we called an informal field
6 investigation. If it's applicant farmer A and protestant
7 farmer B we would hold this field investigation out on the
8 edge of the ditch. Why do you not want the application
9 approved? Why do you need the application approved? The
10 field investigation report was written up and a decision was
11 based on that. Those were rarely appealed.
12 More and more, since more and more of the contested
13 applications are appealed, then of course, again, you have to
14 build a record otherwise you just get it remanded back and you
15 have to hold a hearing anyway. You might as well hold it
16 right up front. So more and more of the hearings -- or
17 contestations I should say -- are going to the full, formal
18 hearing where the testimony is sworn and the evidence is
19 marked.
20 Some, particularly the United States, I held the
21 hearings on the Yucca Mountain filings and there were nine
22 days of hearings and those U.S. attorneys didn't feel
23 comfortable so they associated with local counsel and he did
24 all of the examination, wrote all the briefs, et cetera.

1 MR. WILSON: The local deputy?
2 MR. TURNIPSEED: The local deputy. And the other way,
3 of course as Susan said, they associated with local counsel
4 whose bar license is expired or inactive or disbarred or
5 whatever. I don't know, those kinds of things.
6 MR. WILSON: What do you do in that case?
7 MS. JOSEPH-TAYLOR: I mentioned it to him when the rule
8 came out. He was the only person who called and complained
9 about how he needed local counsel and I said: You don't
10 follow the rules as they are now. Would you like to discuss
11 it with the state bar? And he was shocked I had checked.
12 So we just wanted to present to you that in our agency
13 there's a lot, and thank you for your time.
14 MR. WILSON: Thank you for your time.
15 Good morning.
16 MR. FOLEY: Good morning. My name is Dan Foley, I'm
17 the general attorney for Nevada Bell. I submitted testimony
18 and attached to that testimony were several examples from
19 other states where they have adopted some rules that I would
20 like you all to consider. Basically I'm focused on a topic
21 that's dear to my heart, and that's in-house counsel.
22 I've been in-house counsel for SPC Communications for
23 about 16 and a half years. SPC has approximately three
24 hundred attorneys scattered around through 20 states and

1 several are overseas. Nevada is unique in that it's one of
2 the few states that we actually have attorneys located in that
3 have a fairly restrictive reciprocity policy.
4 And so I'm advancing two recommendations. First
5 recommendation is that the commission think about adopting
6 rules that clearly delineate what an attorney can and cannot
7 do as an in-house attorney pending admission to the bar. That
8 varies from one state to another. Some states, for example,
9 have a fairly liberal policy in terms of allowing the attorney
10 to advise counsel or to advise their clients, in-house
11 clients, as well as to communicate with third parties on
12 claims and disputes. And about where they draw the line,
13 almost all states, is that if you're not admitted you can't
14 appear in court by yourself, you have to associate and deal
15 with local counsel.
16 And then there's some differences in terms of
17 administrative agencies. Some are more lax than others. I
18 have appeared, in my practice I've been in four, five states
19 now, and I've appeared before the West Virginia Public Service
20 Commission, the Texas Public Utility Commission, the Oklahoma
21 Corporation Commission. I have not been before the Public
22 Utility Commission here in Nevada, I came back a month ago.
23 But some of those agencies allow you to appear without
24 counsel, some require it.

1 But currently when I came, when I came to Nevada,
2 because I'm new to the state and I certainly don't want to get
3 in trouble with the bar early on, I asked our outside counsel
4 to -- what was permissible in Nevada. And the response that I
5 received was that it's all right to advise counsel internally
6 but you cannot communicate to third parties about claims and
7 disputes regardless if they're in an agency or court. Now,
8 that is a very cumbersome process, especially in Nevada where
9 you only take the bar once a year. Basically what that tells
10 you is that for about 15 months -- I came in August, the bar
11 is offered in July -- that for 15 months I cannot communicate
12 with a third party in the state of Nevada about a claim or
13 dispute.
14 Well, Nevada Bell, unfortunately, because we have a lot
15 of vehicles, we have a lot of employees, we have a lot of
16 customers, we get involved with a fair number of disputes from
17 time to time. And so it leaves you in the role of telling
18 your clients, well, this is what you have to tell somebody
19 even though you could probably tell them a lot clearer in
20 terms of what a statute of limitations is or what their
21 exclusive agreement is under a contract or something than the
22 client can or you must run out and get outside counsel to do
23 it for you. That adds up to an expense.
24 So the first set of rules -- and it's attached to my

1 testimony as Exhibit C -- is sort of a hodgepodge of rules
2 from other states that I've taken that seem to set some
3 reasonable parameters on what in-house counsel can do pending
4 the bar admission. And I cite some examples in my testimony
5 from other states where they have adopted similar rules. I
6 noticed -- and I haven't read the full report but I did read
7 the section involving in-house counsel from California.
8 The California Supreme Court Advisory Task Force had a
9 multijurisdiction practice report in July of this year and
10 they basically, not verbatim, but they adopted a similar set
11 of recommended guidelines for in-house counsel pending
12 admission. They would have to register, the have to comply
13 with the CLE, they would be subject to disciplinary action in
14 the state for violating the rules but they could not appear in
15 court. And that's not attached to my testimony but I have an
16 extra copy if I could leave that.
17 MR. MOWBRAY: Fast forward to Exhibit C, here.
18 MR. FOLEY: Okay.
19 MR. MOWBRAY: Tab 12 in your materials.
20 MR. WILSON: You're in-house for Nevada Bell and is
21 Nevada Bell in Nevada? It's a division, obviously.
22 MR. FOLEY: Right, and Nevada Bell is a corporation.
23 It's not Nevada Bell Telephone Company, it's a corporation.
24 MR. WILSON: Right.

1 MR. FOLEY: It's a wholly owned subsidiary.
2 MR. WILSON: And your activity is limited to Nevada
3 Bell and you're in-house counsel for Nevada Bell?
4 MR. FOLEY: Right. My office is located in Reno, I'm
5 responsible for the legal matters in Nevada.
6 MR. WILSON: Right. So you don't, I mean, as in-house
7 counsel you don't hold yourself out to the public as a lawyer,
8 your sole client is Nevada Bell, your employer?
9 MR. FOLEY: That's correct, yeah. The only third
10 parties I deal with are normally either adversaries, folks
11 calling, making claims -- or disputes -- and then I represent
12 the company's interests, if I can do that.
13 MR. WILSON: Right.
14 MR. FOLEY: But I would not give outside advice, no, to
15 the public.
16 MR. MOWBRAY: Mr. Foley, can I ask you to read into the
17 record your attachment C? It's not that long.
18 MR. FOLEY: Okay.
19 MR. MOWBRAY: For our record.
20 MR. FOLEY: This is the proposed interim rule -- and
21 there are two recommendations. This is the first rule about
22 pending admission, what activities are admissible for in-house
23 attorneys. An attorney -- the first section, section one:
24 An attorney licensed by another state or the District

1 of Columbia to practice law may be employed as in-house
2 counsel in the state of Nevada and shall be permitted to:
3 A) Provide legal counsel to his or her employer.
4 B) Communicate and negotiate with third parties on
5 behalf of his or her employer regarding but not limited to
6 such matters as complaints, disputes, claims, contracts and
7 settlements.
8 C) Represent his or her employer in court proceedings
9 provided that the in-house counsel attorney associate with
10 licensed Nevada counsel -- or Nevada attorney.
11 D) Represent his or her employer in administrative
12 proceedings and, if permitted by the agency, can do so without
13 the assistance of a Nevada licensed attorney.
14 E) Take those actions that a non-attorney of the
15 corporation could lawfully perform as a management employee or
16 officer of the corporation, provided the in-house attorney is
17 a management employee or officer of the corporation.
18 In section two:
19 In-house attorneys will be subject to the following
20 disciplinary proceedings, will be subject to the disciplinary
21 proceedings of the Nevada -- of Nevada for violations of the
22 rules of professional conduct and must comply with the
23 following requirements:
24 A) In-house attorney must comply with Nevada's CLE

1 requirements where licensed attorneys maintain records
2 sufficient to document compliance if requested.
3 B) In-house attorneys must be admitted and remain in
4 good standing with the highest court of another state or the
5 District of Columbia until such time that they're admitted in
6 Nevada.
7 And then C) On external correspondence and business
8 cards, in-house attorneys identify the states they are
9 licensed to practice so that it is clear that they are not
10 licensed in Nevada.
11 MR. WILSON: Would you add to that that it would be
12 good public policy if in-house counsel were required to
13 register with the state bar, that is, in-house counsel that is
14 representing a company that he or she is employed by as
15 in-house counsel, and obviously comply with CLE requirements
16 and other professional standards so that they're of record?
17 MR. FOLEY: I think that would be a good idea. On
18 occasion we have had correspondence directed to the Bar
19 Association about in-house counsel and I think it's good idea
20 for the Bar Association to know who is the in-house counsel in
21 state.
22 MR. CURTAS: How many attorneys are employed here?
23 MR. FOLEY: Here in Nevada Bell?
24 MR. CURTAS: Yeah.

1 MR. FOLEY: Presenting I'm the only attorney here. We
2 have one additional slot that we're looking to fill. We're in
3 a hiring freeze. And we'll associate -- typically the way SPC
4 does things -- I know all corporations are different --
5 they'll bring in a head attorney that has some experience with
6 the corporation or telecommunications law and then the
7 junior's position, they'll try to bring in a local attorney
8 who is familiar with the courts, familiar with the processes,
9 and then bring that attorney up through the organization. For
10 example, I started in Oklahoma doing civil litigation for the
11 telephone company.
12 MR. WILSON: Your comments are directed solely to
13 in-house counsel, that is counsel employed by Nevada Bell or
14 its parents?
15 MR. FOLEY: Right.
16 MR. WILSON: Okay. Under what circumstances do you
17 use, do you retain private counsel?
18 MR. FOLEY: Currently for all litigation we have
19 outside counsel since I can't appear in court. For all PC
20 matters we'll associate with counsel because there's some
21 issue about whether or not you can appear at the Public
22 Utility Commission. And even though it's fairly expensive and
23 in listening to the prior testimony where you have the counsel
24 who's sitting there billing you at $150 to $250 an hour while

1 they're sitting at a hearing, it's fairly pricey for a company
2 such as SPC but we'll comply with, of course, the Bar
3 Association guidelines until we clarify.
4 MR. TURNER: How would we verify that in-house counsel,
5 the in-house counsel practicing here but not licensed were
6 actually in good standing with their own bar association?
7 Would there be a method that you would suggest to do that?
8 MR. FOLEY: For example, in Missouri as I was reading
9 through, I think it's Missouri or Kansas, when you register as
10 in-house counsel you have to provide a certificate of good
11 standing.
12 MR. TURNER: And would you do that once a year to make
13 sure that you were in fact, every year, still in good
14 standing?
15 MR. FOLEY: You could do that. You also -- I'm
16 admitted in four bars so yearly I get statements from each of
17 them saying, you know, your bar dues are due. And it gives us
18 the bar number and everything and that would also show us in
19 good standing. If you go out and get a certificate, typically
20 you have to go write the clerk of the supreme court or there's
21 an attorney agency or bar agency and you have to write that
22 agency, admission agency, and they will send you a
23 certificate. But those are the, sort of the in between when
24 the attorney first gets to the state before they can be

1 admitted.
2 I'm also recommending a second rule and some call it
3 reciprocity although you could call it other names, too. You
4 could call it admission by application. Several states, and
5 there are examples in the packet, the state of Washington, the
6 state of Missouri, the state of Kansas have specific rules
7 allowing for either temporary or limited licenses to practice
8 law for in-house counsel. Basically it has the same
9 limitations as the -- it's sort of the interim step I've
10 outlined, before you're admitted, but it also allows you to
11 appear before an agency of the courts. One exception, the
12 state of Washington, I think, has a specific prohibition
13 saying you can't appear in court even with that limited
14 license. But Missouri and I think Kansas you can appear in
15 courts in administrative agencies.
16 The administrative agencies, it's probably the area of
17 law that I know most about just because I've been in
18 telecommunications for 16 years. That is one area that having
19 out-of-state attorneys or people with experiences in other
20 jurisdictions, I think, are extremely helpful. A lot of the
21 issues right now for telecommunications companies, especially
22 the former Bell Operating Companies such as I'm employed by,
23 deal with a telecommunications act of 1996 and a
24 communications act.

1 Most of that is federal but it's federal requirements
2 that are planted on -- or that are placed upon the state
3 agencies where they have to make all sorts of fact findings.
4 And the rules are very complex, the proceedings can last for
5 two to three weeks, some have lasted months, and there are
6 more really federal issues that come into play than state
7 issues. And that area of the law, it's more helpful to have
8 someone who has background in that aspect of the law than what
9 the local court law or the state law is, although I think it's
10 helpful, certainly, to have some experience in that in terms
11 of how to make objections, what are the proper procedures, do
12 you stand up to make an objection, that sort of thing. You
13 know, what the burdens of proofs are and that sort of thing.
14 A lot of that you can learn but the more complex area is the
15 telecommunications area so I think the out-of-state attorneys
16 that have experience in that that relocate to the state
17 certainly have a lot to offer in that respect.
18 MR. WILSON: This is before the PUC?
19 MR. FOLEY: Yes, sir.
20 MR. WILSON: What is the PUC policy and practice with
21 respect to appearances and local counsel?
22 MR. FOLEY: I've not talked to anyone with the PUC,
23 I've talked to our outside counsel, but what I've been told is
24 that if you want to appear at a proceeding you can do so but

1 you need to appear with local counsel. I don't ever recall
2 seeing a rule to that effect but I think --
3 MR. WILSON: But that's your understanding?
4 MR. FOLEY: That's my understanding.
5 MR. WILSON: So anytime Nevada Bell appears before the
6 PUC -- or do you appear on this behalf and for the appearance
7 you associate with Nevada counsel?
8 MR. FOLEY: Yes, sir, that's my understanding of the
9 current rule.
10 MR. WILSON: Right. Is it necessary, in your judgment,
11 to associate with Nevada counsel for the substantive reasons
12 of your appearance?
13 MR. FOLEY: I don't believe so. The hearings that I've
14 been involved with in the past, the Public Utility
15 Commissions, involve areas that are sort of not unique to any
16 specific state. They involve either the telecom act or the,
17 the PR or the regulations. The regulations are fairly common
18 from one state to another. How much deposit can you require
19 of a customer? Can you terminate service without notice under
20 what situation?
21 The local rules vary from one jurisdiction to another
22 but the arguments that you make to support a change of the
23 rules are basically the same.
24 MR. WILSON: With respect to your illustration a moment

1 ago where you're applying federal standards and requirements
2 and criteria that are applicable in the state, but
3 nevertheless on the subject of a PUC hearing for purpose of
4 the application, I'm drawing the inference from what you said
5 that local counsel really aren't much help subsequently. You
6 may have to retain one on a pro hac basis but the laboring law
7 you carry yourself. You know what the standards are, you know
8 how they apply, you can address the Public Utilities
9 Commission on how they should apply and should not apply,
10 local counsel really isn't necessary and isn't a necessary
11 expense?
12 MR. FOLEY: In certain situations I think it's
13 absolutely true. In other situations --
14 MR. WILSON: You're going to want to hire local --
15 MR. FOLEY: -- I would hire local counsel depending on
16 the how much --
17 MR. WILSON: It depends on the situation?
18 MR. FOLEY: Right. And also being brand new to the
19 state I would not just go into the Public Utility Commission
20 by myself the first couple of times, I would associate with
21 local counsel just to learn the way and the process. You
22 don't want to alienate those judges at the first at bat and so
23 you would want to associate with local counsel just to get a
24 better feel for the proper decorum and the proper procedures.

1 On the application process, you might ask yourself:
2 Why should we have a special rule for in-house counsel? And I
3 think that's a fair question. I think you don't have a lot of
4 the ethical issues with in-house counsel that you do with law
5 firms and folks that hang up a shingle. They're not
6 handling -- you know if you read the bar journal and you read
7 the reprimand and the disciplinary sections, there seem to be
8 like four or five themes that you see constantly which lead
9 attorneys into misconduct allegations.
10 Client funds is certainly one, combing your client
11 funds into trust accounts and that sort of thing. In-house
12 counsel don't handle those. Solicitation of clients, improper
13 solicitation, advertising type issues, in-house counsel
14 doesn't get involved with those. Fee disputes is another
15 common area. In-house counsel don't bill fees so you don't
16 have those type of issues associated with in-house counsel.
17 And the client is in a much stronger position to take
18 disciplinary action against the attorney if they mess up or if
19 they miss the statute of limitations or something. They can
20 terminate the attorney, they can cut their salary. So the
21 client has a lot more control than someone who just merely
22 retains somebody off the street over that individual.
23 Lastly, I think it's good for the state of Nevada that
24 large corporations are constantly relocating. Since the time

1 I've been with SPC we've moved our entire legal staff from
2 Saint Louis, where I worked for the company, down to San
3 Antonio. I was with Cingular Wireless -- which is an
4 affiliate of SPC -- and I was the regional general counsel for
5 the east region. We were moving the office. We were thinking
6 about moving to downtown D.C. and bringing all of the lawyers
7 with us -- we had seven lawyers plus the senior staff of
8 officers for the east region, about 20 employees.
9 One of the issues that we looked at as far as the legal
10 department is how easy is it for those attorneys to get
11 admitted into the state, do we have to worry about admission
12 requirements. And I think a state does itself a disservice
13 sometimes if it has a real restrictive policy on allowing
14 in-house counsel -- because that is a fairly strong deterrent.
15 My position sat vacant for several months because they
16 couldn't locate an SPC attorney with some experience in
17 telecommunications to come in and take the job. It's one
18 thing to hire someone off the, you know, the street that could
19 be a great attorney, but those attorneys don't know the
20 corporate culture, they don't know who to contact.
21 So I think it would facilitate bringing large
22 corporations, large legal departments into Nevada if they had
23 a fairly receptive policy of application -- or registration by
24 application for in-house attorneys.

1 MR. ADDISON: I have one question. You describe your
2 first recommendation as an interim procedure until the time
3 that you take the Nevada bar. Is that the case and if so do
4 you recommend a termination date or a certain period that one
5 can register after which it expires and you can't do that
6 anymore, you have to take the Nevada bar?
7 MR. FOLEY: No, perhaps I was a little confusing. The
8 rules on attachment C is basically once you get to the state,
9 the first day that you arrive in that state, what is
10 permissible versus impermissible for in-house attorneys. I
11 would still recommend a second step, and that is you allow
12 attorneys for in-house to be admitted by application.
13 Typically the states that I've, did my reciprocity, Texas and
14 Missouri were the only two -- and Maryland has kind of a
15 hybrid where they take half the exam -- but in those two
16 states it typically takes about six months to eight months
17 even once you start the paperwork process to get admitted.
18 You have to request all of the forms, like the certificate of
19 good standing from the foreign court. And you get all that
20 and your application, they do background checks, a lot of them
21 do FBI checks, they get your fingerprints, but it's a fairly
22 complicated process and that takes about eight months. After
23 that eight-month period then they would be admitted under that
24 special or limited license to practice law.

1 MR. WILSON: Thanks very much.
2 MR. FOLEY: Thank you, I appreciate the opportunity.
3 (A short break was taken at this time.)
4 MR. WILSON: Why don't we go back on the record and
5 take the next witness.
6 MR. HAMILTON: I guess I'm it. Good morning, my name
7 is David Hamilton and I've been practicing in Reno for 29
8 years now. I'm also licensed in California. The major reason
9 I came up here to address you is that I have some concern
10 about how out-of-state counsel gets served. I've had
11 difficulty with this a number of times. And for instance,
12 you're in the middle of litigation, which I do quite a bit of,
13 and you have some emergency gripe that comes up, you ought to
14 be able to serve out-of-state counsel by fax.
15 There's a case called F & F versus Chief Construction,
16 I believe, which says you can't serve by fax and a court can't
17 order it. There is a conflicting Eighth Judicial District
18 rule which says that you can. I think that if you allow
19 out-of-state -- yes, ma'am?
20 MS. BECKER: The Eighth Rule was passed after the case.
21 MR. HAMILTON: I know, but it's still for the rest of
22 the state, I think, you can't certify fax.
23 MS. BECKER: That's correct.
24 MR. HAMILTON: And I think that there ought to be a way

1 to serve out-of-state counsel by fax, at least in the
2 emergency situations if not always. But there ought to be
3 some kind of a modifier on it so that it can't be used as a
4 weapon to serve somebody at 9:00 o'clock Friday night and the
5 person doesn't come to their office over the weekend and all
6 of a sudden they've got five -- three to five days to answer.
7 Like over the Thanksgiving weekend you could get really hurt
8 that way. There ought to be a way to keep that from being a
9 tool of oppression.
10 The next thing I'd like to talk to you about --
11 MR. MOWBRAY: Dave, can I ask you from that point on
12 the fax. In the cases where you're concerned, don't you have
13 local counsel that you can also effect service on, local
14 counsel in addition to out-of-state counsel?
15 MR. HAMILTON: As an example, there is a gentleman by
16 the name of Doyle who is subject of the Barrett versus Baird
17 decision who practices in Sacramento, and his local counsel is
18 Kim Mandelbaum in Las Vegas. And you need an order here in
19 Reno, short in time, you want to give them advice that you're
20 going to go seek it from the judge, how do you serve Kim
21 Mandelbaum in Las Vegas for a Sacramento attorney? That's
22 just one example of why I think you need a rule on that.
23 The second thing I wanted to talk about is I do a lot
24 of attorney malpractice cases and frankly I'm getting a little

1 sick and tired of not being able to sue some attorneys because
2 it's useless, you get a piece of paper. I think that there
3 ought to be mandatory malpractice coverage for not only Nevada
4 attorneys but for the out-of-state, but for particularly the
5 out-of-state. And I think that there ought to be some way
6 that they have to prove that the policy covers their acts in
7 the state and that they consent to jurisdiction in our local
8 courts and not remove it to federal court. There ought to be
9 a waiver of their right to remove because the people, for
10 instance, who were malpracticed in Elko, they ought not to
11 have to come to Reno and get a federal court to deal with
12 their case, they ought to be able to do it in Elko County --
13 White Pine County, wherever.
14 So I think there ought to be a stipulation that they
15 consent to jurisdiction in the local state courts for
16 malpractice.
17 MR. WILSON: On the part of an insurance company?
18 MR. HAMILTON: Well, I think that if you bind the
19 attorney when he somehow registers or become a members -- or
20 becomes able to practice here, that he sign some document
21 waiving. I would think that would be binding on the insurance
22 company.
23 MR. WILSON: It would?
24 MR. TURNER: Yes.

1 MS. PISCEVICH: Well, not if it's an contractual
2 relationship.
3 MR. TURNER: It depends on how they word it, but --
4 MS. PISCEVICH: You can't bind somebody --
5 MR. TURNER: No, but generally I think you can bind --
6 MR. HAMILTON: But the insurance company is not a party
7 to a malpractice action, so --
8 MR. TURNER: They're just obligated under contract to
9 pay whatever damage is incurred, and I don't think they can
10 limit where you could bring the lawsuit.
11 MR. HAMILTON: I don't think so either, but if that
12 were the insurance commissioner could pass a rule to take care
13 of that problem. So I think that you ought to look at the
14 malpractice not only for out-of-state people but for in-state
15 people, and I think that ought to apply for in-house counsel,
16 even though they seldom get involved, because they can, they
17 can affect someone who has a right to sue, because they're the
18 other side, because of some act they do and there should be
19 coverage for those people. Because their clients, non-clients
20 can sue an attorney for acts related to malpractice and there
21 ought to be coverage for those.
22 And the other point I would like to make is that I
23 think that there ought to be a registration process where you
24 can just register to practice in the state of Nevada. There

1 ought to be a short delay while the state bar gets a chance to
2 check up on your home jurisdiction. I think one of the things
3 that we ought to do is require the state bar to put up the
4 names of the admitted attorneys who are eligible to practice,
5 like California does, where you can just go to the name of the
6 person, find their name, address, phone number, fax number and
7 whether they've been disciplined in California.
8 I think we ought to have that up on the Internet so
9 that when Nevada lawyers go to other states that there is an
10 easy way to check up, because this ought to be fair both ways.
11 We've got to look at how we're treated in other states. I've
12 practiced in Tennessee and Connecticut and I didn't have any
13 trouble and I was treated cordially and fairly by the judges
14 in those states.
15 Is there any questions?
16 MR. MOWBRAY: On your registration process, would it be
17 for specific, limited circumstances or are you advocating just
18 a general registration process?
19 MR. HAMILTON: I believe a general registration would
20 be fine. I don't think it ought to be just for a specific
21 case. The marketplace will -- by the prices charged by the
22 out-of-state attorneys -- will control how much they come
23 here. Although we'd like to keep it a closed shop here, I
24 think that Nevada attorneys, by keeping their fees down, will

1 close the market off to a great degree to out-of-state
2 attorneys.
3 MR. CURTAS: Doesn't that basically abrogate the entire
4 qualification to practice law in Nevada? Basically we're just
5 opening the doors and saying anybody in any state can practice
6 law. As long as you're licensed somewhere else you can come
7 here in an unlimited capacity and practice law here --
8 MR. HAMILTON: Yes.
9 MR. CURTAS: -- just by signing a register somewhere.
10 Is that what you're advocating?
11 MR. HAMILTON: No, I'm not advocating that you come
12 here, move here, use a license from another state, but I think
13 that you ought to be able to practice any time you get a
14 client here.
15 MR. TURNER: Would you require the person registering
16 to pay a registration fee, and if so, what would you suggest
17 that be?
18 MR. HAMILTON: Same as the bar does. I mean, they
19 ought to be treated just like we're treated.
20 MR. HARDESTY: Well, you're talking, David, about a
21 registration process that requires the parties to submit to
22 the jurisdiction, the state bar and all the disciplinary
23 requirements and the like.
24 MR. HAMILTON: I'm sorry, I don't remember the name of

1 the case but there is a case that says if you come in here and
2 do an act in Nevada you're subject to discipline by the state
3 bar. And I'm sorry, I don't remember the name.
4 MR. MOWBRAY: Bar versus Waters?
5 MR. HAMILTON: Yes. So I think that that's already
6 covered. I don't, I don't know if the disciplinary process
7 needs to be fine-tuned. I sat for nine years on the
8 disciplinary committee and I think that I would have one
9 caveat to an out-of-state attorney who is being charged with
10 disciplinary violation, that he has to have a local attorney,
11 in that process, to deal with him. But I guess that comes
12 back from my bias of seeing too many attorneys representing
13 themselves in front of the grievance committee and not doing
14 too well and making the panel's decision harder to make.
15 MR. MOWBRAY: Let me give you a hypothetical just to
16 kind of test your theory, here. If you had an out-of-state
17 lawyers, say licensed in Indiana in good standing, under your
18 model he or she should be able to come to Nevada, register --
19 let's say representing a Nevada citizen. And under your
20 scenario if there was a problem, a disciplinary problem, would
21 Nevada then be the forum to adjudicate the disciplinary
22 hearing? And under your scheme, would you expect that Indiana
23 then would give full faith and credit to the Nevada decision?
24 MR. HAMILTON: Yes.

1 MR. MOWBRAY: Okay.
2 MR. HAMILTON: And I think there's got to be -- I don't
3 know how, I don't know how you would write the rule, but I
4 kind of would like to have the judge -- if it's a litigation
5 case -- have the ability to say: You're suspended because of
6 the conduct in this case. I mean, if it's just somehow so
7 abhorrent -- a number of cases in Carson City, I can't
8 remember the attorney's name, he passed away now, but I just
9 wish the judge had said: You can't do it anymore because
10 you're just so incompetent you're hurting your clients. But
11 that leads to the temptation sometimes for the judge to
12 disqualify somebody just because they would like -- be more
13 comfortable with a local person. But I still think that there
14 ought to be a right to register and practice.
15 MR. TURNER: There would be a problem with the rules of
16 evidence and procedure in Nevada courts that outside counsel
17 would not be familiar with and that would create a problem
18 judicially.
19 MR. HAMILTON: I practice with a number of, been local
20 counsel for a number of attorneys but I guess I've been real
21 lucky, some of them have been real good. Tom Sheridan, I
22 don't know if any of you know Mr. Sheridan. He was the United
23 States attorney for the southern district of California,
24 prosecuted Hoffa and got him. He didn't have any trouble.

1 MR. TURNER: The federal practice I would assume that
2 to be the case, but in the state practice it might be a
3 different matter.
4 MR. HAMILTON: Well, he was doing the Louie St. Pierre
5 murder case here in local court in front of Judge Barrett
6 years ago, he didn't have any trouble with any of the rules,
7 and they were much different then than they are now.
8 MR. TURNER: Generally the federal court will require a
9 greater knowledge of rules of evidence. The procedures are
10 stricter so that you can get a, to some extent, a higher
11 trained attorney. So of course to open the doors to every
12 attorney from any other state by registration, they adhere to
13 our local rules and our local way to practice, you don't think
14 that would create a problem?
15 MR. HAMILTON: I think that there would be problems, I
16 can't argue with you there at all. But our rules, we've tried
17 to make then generalized by adopting the Federal Rules of
18 Civil Procedure, we've got federal rules of evidence, I don't
19 think they're that difficult. I've seen a number of
20 California attorneys come up here and do very well. Some of
21 them don't do well. But I don't know, I think that the United
22 States supreme court cases that I've read leave me to believe
23 that we should be free practice anyplace, at least on a
24 temporary basis.

1 And, you know, any other business almost, except maybe
2 doctors, lawyers, engineers, and even some of those states the
3 engineers can go practice in other states with just a Nevada
4 license. Why should we be any different as lawyers? Why
5 should we have a closed shop?
6 MR. WILSON: David, thank you.
7 MR. HAMILTON: Thank you.
8 MR. WILSON: Good morning.
9 MR. CROWLEY: Good morning, my name is Martin Crowley.
10 My name showed up on here because when the bar sent the notice
11 out they said fax in this thing if you want to come to the
12 meeting, not necessarily if you wanted to speak. And I
13 thought: Well, I better do that if I want a seat. And I came
14 here this morning and I realized that that wasn't a necessary
15 requirement. I didn't have to elbow my way through. But as I
16 listened to the testimony I thought maybe I would comment on a
17 couple of things.
18 Mr. Foley's comments, I think, are very important. I
19 don't think that we should be restricting in-house counsel for
20 corporations like Nevada Bell or other corporations that
21 choose to locate their businesses here. I do a lot of
22 business work with corporations that are just starting out.
23 They're just -- they want to come to Nevada and make it their
24 headquarters and as most of you know this is one of the prime

1 states to incorporate your business, that and Delaware. And
2 we're doing everything we can to promote that. Well, if we do
3 something like restrict their counsel then we're cutting off
4 part of that line of work.
5 MR. WILSON: Like in-house counsel?
6 MR. CROWLEY: Like in-house counsel. I don't think he
7 should be restricted. He's obviously well qualified. He
8 knows his business. Why should he be prohibited from
9 appearing before the Public Utilities Commission or something
10 of that nature? It's like -- it's not likely he's going to
11 find a local counsel to associate with that knows his business
12 better than he does.
13 So in those specialized areas like they were talking
14 earlier with the water law, things of that nature, you've got
15 these professors and people from, you know, Colorado and
16 places like that, you're not going to find somebody probably
17 more qualified than those attorneys, and to require them to
18 associate, necessarily, I don't think is -- you've done
19 anybody any favors.
20 I've practiced in Nevada for 14 years now, mostly trial
21 practice, and I've appeared in almost every court in this
22 state. I've appeared many times over in Yerington. I've been
23 in Carlin in the justice court and if you've never been in
24 Montello, that's an experience for you, you know. And so all

1 of these little courts, you've got a different flavor
2 everywhere you go: Austin, Eureka, Ely, Lovelock. You know,
3 you go to Lovelock and you go to a converted church. That's
4 the courthouse. So you have a different flavor everywhere you
5 go.
6 And I've practiced in front of judges in Saint Louis
7 and in Utah and in Washington, and in the Saint Louis
8 experience I went through the formal process that they have
9 there but it's not quite as strict as ours, just associated
10 with local counsel. He showed up the day of the hearing,
11 introduced me to the judge and he says: I've got another
12 hearing in department such-and-such, Judge. If you need to
13 get ahold of me but he appears to be qualified and he knows
14 the case and so he's here and good luck, you know, type of
15 thing.
16 And for that particular case it was important to be
17 able to do that. I don't even think it was that necessary to
18 employee the local counsel, though, because it cost my client
19 a lot more money than it would have because it cost him
20 already a bunch of money for my travel there and things of
21 that nature. It was a case that had been removed, of course,
22 from Nevada. I was intimately familiar with the facts of the
23 case. Everything that took place took place here but we got
24 jurisdictioned over into Missouri on contract and so there we

1 were.
2 And in the case of Utah the judge admitted me pro hac
3 vice right there on the spot to represent my client. And I
4 thought that was appropriate, I wasn't there to practice law.
5 I had a client that lived there and had a problem that needed
6 to be resolved and I was familiar with the facts of the case
7 so that was more important to her than to try and employ a
8 local lawyer, pay them a bunch of money to get up to speed and
9 to deal with a short, 45-minute or one-hour hearing.
10 So I think there are, there are causes that should be
11 allowed -- where people should be allowed to practice in
12 various jurisdictions but we're only going to get as far as we
13 get. We need to show that we're as open here as other places
14 are willing to be. But at the same time, David's right.
15 We've got to have some sort of protection, too, for the
16 citizens of this state. If somebody's coming in and
17 practicing, practicing law, there's got to be some sort of
18 protection to them.
19 MR. WILSON: Has your experience been in representing
20 Nevada clients whose matter has to be tried in a foreign
21 jurisdiction, Utah or Missouri or --
22 MR. CROWLEY: Yeah, and that was the case. In the Utah
23 one the person had relocated and that type of thing, and I'm
24 on another case over there now because it happens to be a

1 family member. The family member is more comfortable with my
2 representing them than hiring a stranger. And I'm associated
3 with local counsel there but he just signs the paper and
4 submits it to the judge and I'm there, you know.
5 And I think that we should provide for that type of
6 thing. I mean, if you've been practicing a certain number of
7 years, the rules may be a little bit different but they're not
8 that much different. The Rules of Civil Procedure are
9 substantially the same from state to state, things of that
10 nature, and there's little local rules that you've got to
11 grasp on to but it's not that difficult to jump in there.
12 But I think, you know, registering is a good idea but I
13 don't, I don't think you should be able to just come here,
14 just because you've registered, every time and be able to, you
15 know, just jump in and do a case. I don't think that that's
16 right either. I think that you should register for each case,
17 each time that you appear, although I do disagree with the bar
18 fee thing. I wouldn't -- it would have been really
19 prohibitive in Missouri to have paid that fee for the one, the
20 one hearing, essentially. I mean, we had a, you know, a
21 hearing on jurisdiction and there we were. We were there for
22 one day.
23 MR. WILSON: Sort of like a tariff?
24 MR. CROWLEY: It would have been an extremely high

1 tariff for my client, and he was going up against a large
2 insurance company and he was an insurance agent, that was the
3 reason he got into the dispute. He's not a guy that has a ton
4 of money and to hire this other lawyer and then on top of that
5 to pay a fee to be allowed to practice -- and we have that and
6 I disagree with that. I don't think that we should pay $350 a
7 year -- I've associated with outside counsel from Seattle. He
8 came here and he worked on a case and we went to the supreme
9 court and that type of thing, but $350 for every year for the
10 one case? Now, that's not right.
11 I mean, the supreme court cases, as you know, sometimes
12 are going to drag on for two or three or more years and he has
13 to pay that fee each year the case is pending according to our
14 rules. And that's not appropriate for that one case because
15 the client in, in Seattle chooses him as his lawyer and he
16 comes down here and associates with me. You know, I'm sitting
17 there just kind of making sure that he's following the rules
18 and that type of thing, but an extremely competent lawyer. A
19 great firm from Seattle type of thing. But to sit there and
20 force him to pay, you know, over a three year period of time
21 over $1,000 in bar fees for one case, I don't think is
22 appropriate for -- to do that.
23 MR. TURNER: Would we, then, be better not to have the
24 rule of local counsel and simply have them register, which

1 would probably be cheaper than hiring local counsel?
2 MR. CROWLEY: I think it would be so you get some sort
3 of, you get a cross-over there. So he pays, he pays the fee
4 but then he's not paying the local counsel also so that you
5 would, there would be a money savings there. But I don't know
6 if it's appropriate to charge -- what's our fee, $350 or
7 something now?
8 MR. CRUTAS: $350.
9 MR. CROWLEY: For practicing --
10 MR. CURTAS: Are you advocating, though -- do you think
11 the local rules, local rules in Nevada Rules of Civil
12 Procedures are that easily absorbed and that generic that any
13 competent lawyer from any other jurisdiction can come in --
14 we're talking litigation right now.
15 MR. CROWLEY: Yes.
16 MR. CURTAS: And just come on in and maneuver the
17 labyrinth of court procedure and local practice without the
18 requirement of having association with local practice?
19 MR. CROWLEY: I think so because if you get around
20 enough you don't see that the practices are that much
21 different. I've got a set of the Rules of Civil Procedure for
22 the state of Washington, for the state of Utah, and when you
23 pull out the rules and look at them they're not even worded,
24 in many cases, any differently in terms of those types of

1 things.
2 Now, when you get to practice, though, if you're
3 talking about practicing, I wouldn't open the door as widely
4 as: Register here and I can come in every -- all the time. I
5 don't think that that's appropriate. I would favor something
6 similar to what they have, a certain number of cases over a
7 period of time. Because if you're going to come here and
8 practice law then get a license, that type of thing. But I
9 don't think you should shut somebody off.
10 And I was talking to John Schiegelmilch on the break
11 and I said that I have clients that I've had for many years,
12 ten, twelve, thirteen years you've had that same client, they
13 frankly, they don't want anybody else. You've got a
14 relationship with that person -- some of us it's a closer
15 relationship than with our spouse -- and they don't want to --
16 somebody took that the wrong way.
17 MS. BECKER: Would you like that stricken from the
18 public record?
19 MR. CROWLEY: Yes.
20 MR. WILSON: I don't know if that speaks to the
21 attorney/client relationship or the spousal.
22 MR. CROWLEY: Yeah, there you go. It could be the
23 spousal relationship. You spend 14 hours a day at your office
24 for too many years and sometimes your spouse and kids don't

1 know who you are, but your clients sure do. They spend all
2 that time with you. But they don't want to hire anybody else
3 and they really think it's a nuisance, you know, to sit there
4 and associate with local counsel and then they pay all of
5 these extra fees, some hundreds of dollars, up into the
6 thousands if the case continues for a period of time.
7 They shouldn't have to experience that. They don't
8 want to give up their attorney. When you look at the
9 economics of it, though, sometimes you don't have a choice.
10 If you've got to associate with local counsel and pay a bunch
11 of money, you say shoot, you know, here we are several
12 thousand dollars more. I might as well just hire the local
13 attorney than, rather than do the dual attorney expense there.
14 But I think that there's -- you've got a lot of
15 information that you've taken in already that shows that
16 there's a lot to be considered. But I think the regulation
17 stuff, I like what David had to say, that you submit yourself.
18 You know, I think when I appear in Saint Louis or Salt Lake or
19 Seattle or Spokane or someplace, that's it. Once you step in
20 there you submit yourself to the rules, their local rules of
21 discipline, professional responsibility. And you just sign
22 something that says that I submit to the jurisdiction of the
23 courts here should I be subject to discipline. And I don't
24 think that that's that hard to take it that way.

1 MR. MOWBRAY: Martin, can I ask you a couple of
2 questions? Are you advocating a national driver's license
3 approach to licensure; i.e., that if you're admitted in one
4 state you're admitted in all?
5 MR. CROWLEY: I think that would be more fair. Under
6 the constitution under the country that we live in, I think
7 that would be appropriate to allow freedom of choice. You
8 know, if my Florida client wants me to represent him in his
9 Florida trial, he's being tried for his life or his liberty or
10 his property, that should be his choice rather than have to
11 retain the other attorney, but with the restrictions that I'm
12 not spending all of my time there without, you know, doing a
13 little bit more to become part of the local, the bar
14 association.
15 I think you should, you should take the bar and, you
16 know, if you're going to live somewhere and practice there and
17 that's going to be your business, but after a number of years
18 of practicing, you know, there's some states that have a
19 very -- fairly liberal reciprocity. That also depends on
20 where you come from, too. If you want to go to Colorado and
21 get, get your license there after a certain number of years,
22 or New York, things of that nature, well that's a quid pro quo
23 type of, type of thing.
24 And in some of those jurisdiction they may look at you

1 and you come from Nevada and they say, well, Nevada doesn't
2 have reciprocity with us, we're not going to give you that
3 license even though you've got your certificate of good
4 standing that you can walk in there with. And I don't
5 necessarily believe we should force continued background
6 checks on people. If someone's not a subject of discipline in
7 their own state and they went through the FBI background check
8 when they were admitted, the fingerprinting, the whole works,
9 why should we mandate that to somebody who's never had any
10 problems and their own state bar gives you a certificate?
11 MS. BECKER: But many of the states don't do the
12 background checks that Nevada does. That's one of the
13 problems.
14 MR. CROWLEY: And that's something that you would
15 definitely want to consider in granting reciprocity. But if
16 you know that Alabama does a background check and Arkansas
17 doesn't, then that's something you would want to put your
18 registries. Say: Look, we're sorry that your state doesn't
19 do those things but we require those from attorneys that
20 appear in our courts and practice in our state. So if you
21 want to come here for this pro hac vice, you'll have to submit
22 to a check, a background check, and you'll have to pay the
23 $500 fee and whatever, you know, whatever an investigation
24 costs, and do that. But in the cases where we already have

1 those background checks, I think that would be totally
2 unnecessary and a waste of time and money.
3 MR. WILSON: Questions?
4 MR. CROWLEY: Thank you.
5 MR. WILSON: Thank you. Your timing is impeccable.
6 MR. REIS: I apologize if it's not.
7 MR. WILSON: You're right on time, you don't need to
8 apologize.
9 MR. REIS: Good. Here's some written testimony that I
10 believe everyone has a copy of and I think we have enough
11 copies.
12 MR. WILSON: State your name, sir.
13 MR. REIS: Okay, it's Robert Reis. I'm the vice
14 president for insurance operations of ALPS, Attorneys
15 Liability Protection Society. ALPS has, for 13 years now,
16 been the bar sponsored profession liability insurer for
17 lawyers in Nevada, as it is the bar sponsored professional
18 liability insurer for lawyers in ten other states and does
19 business in a total of 24 states in the jurisdiction.
20 I won't read through the testimony that I hope you have
21 a copy of and you'll have a chance to read other than to
22 highlight a few of things that we've said there and to invite
23 any questions that you may have. Let me also say we
24 appreciate the opportunity to be here. We bring a different

1 perspective, I think, and I hope it's valuable to you.
2 Professional liability insurer, we've become extremely
3 interested in those claims and the costs associated with those
4 claims that are developed from multijurisdictional practice.
5 What we know is that it already happens. What I realized
6 yesterday when I started to run some statistics is that it
7 happens more in Nevada than it does in the other states in
8 which we do business. There may be a number of reasons for
9 that and we can speculate to that. I don't have facts to
10 really tell me why but I can say that it happens more.
11 It is of particular concern in a number of different
12 areas. One of the things that we started to look at, as we
13 always do and as insurers do, would be the claim statistics.
14 What are the dynamics of our claims? We all now calculate
15 those and we track those on an ABA system and that's why all
16 of us can report every five years, approximately, better
17 statistics than we have in the past. Unfortunately, we don't
18 report statistics that would lead us to believe what the
19 multijurisdictional component of that is but there are a few
20 things that we can look at.
21 One of things that I looked at among three of our
22 larger states is how many times the claims arise when we
23 defended an action outside of the jurisdiction or we had a
24 claimant -- or client, if you will -- who was served from

1 outside the jurisdiction. And as you see in the materials
2 it's over 13 percent in Nevada. Those 13 percent of claims
3 have accounted for more than 20 percent of the dollars spent.
4 So they have, on average, been more severe than other claims.
5 Compared to our other two large jurisdictions where our
6 penetration of lawyers in terms of the marketplace -- that is
7 the same percentage, roughly, of all of the lawyers in private
8 practice are insured as are in Nevada -- the percentage is
9 amazingly high. And I was very surprised at that. It's 3.7.
10 I think that the material suggests that Montana is 1.3, and
11 South Carolina. Those states do not have the same draw from
12 folks coming out of town as you do, obviously, but nonetheless
13 they border areas where folks tend to practice across state
14 lines.
15 MS. BECKER: Mr. Reis, let me see if I understand you
16 correctly. Those are claims against Nevada lawyers from
17 people out of the state of Nevada, correct?
18 MR. REIS: Correct. And they were either litigated
19 outside the state of Nevada or they are non-Nevada residents
20 who came here and they're litigating here. When we -- more
21 specifically to the Nevada claims I thought initially: Well,
22 this must be slips and falls in casinos. This has to be
23 personal injury claims from other jurisdictions from people
24 who flew in, fell, engaged a Nevada attorney, went back to

1 their jurisdiction, later had a malpractice claim.
2 In point of fact, only two of all of the cases we had
3 involved that particular scenario. Most of them are
4 transactional representation, which has to do with people who
5 want to do business across state lines and find it attractive
6 to do so in Nevada for a host of reasons and it involves a
7 host of different types of business relationships. That's
8 pretty much the claims data from what we can specifically
9 glean from multijurisdictional practice.
10 The other thing that I would highlight for you, and
11 this is incidental but I've listed in the materials a number
12 of things that have come to us in an underwriting fashion.
13 And this, perhaps, is more of an indication of currency. That
14 is, what is the current interest in multijurisdictional
15 practice and what are folks doing about it, vis-a-vis
16 attempting to practice or at least being insured for their
17 practice in Nevada. The incidents that I've listed in the
18 material all happened within the last six weeks.
19 It's not a catalog of what's happened in the last year,
20 it's our most recent memory of those applications which came
21 to us and which we declined. That is, we did not issue
22 policies for these individuals who sought coverage for a
23 variety of reasons, not the least of which was we didn't know
24 what the playing field was. They wanted to bring us an

1 exposure -- because they wanted to practice across state
2 lines -- that we could not qualify or quantify, and therefore
3 we could not set a rate for because we could not understand
4 what their practice dynamics would be.
5 In that particular scenario we really only have two
6 choices, we can pick the highest rate for any of the states in
7 which that group would practice or we can do what the medical
8 malpractice insurers did years ago and say we will charge you
9 a premium for each license you hold. So you'll pay four times
10 your malpractice premium if you hold licensure in four states,
11 or something like that, which is very onerous. It's not done
12 now but it is a concept that has been done and some insurers
13 may return to. I hope not. It is difficult to quantify and
14 qualify and therefore price and administer an insurance
15 program when folks do practice across state lines and there
16 are not uniform standards that we would expect them to adhere
17 to when they do practice.
18 The other thing I would highlight is attached to the
19 material on the fourth page -- I guess it's the fifth page --
20 is our list of rates in terms of what we call the state
21 relatively. When we look at the practice of law in the
22 various jurisdictions in which we write insurance, one of the
23 most important factors and the factor that changes the premium
24 more than anything else because it is a factor applied at the

1 end of the rating calculation, is this jurisdiction in which a
2 lawyer practices.
3 This is an objective number, more objective than our
4 other numbers, because what it is a result of is our claims
5 experience in those various jurisdictions. If you practice in
6 Alaska, for instance, the risk of a loss and the amount of
7 that loss will be much higher than if you practice in the
8 Dakotas. And you can see that there are two numbers listed
9 there for N