The nonprofit Florida Bar Foundation collects the accumulated interest and makes grants to the legal services organizations. Though such trust fund accounts do not generate any significant interest individually, they add up when pooled: Last year, the program raised some $14 million - about 30% of the budgets for the 46 legal services organizations across the state. But a U.S. Supreme Court decision in a Texas case has cast doubt on the program's legality, and legal services attorneys are holding their breaths to see if the ruling will apply in Florida. Miami lawyer Neal Sonnett, the Bar Foundation's president, says the case could create "a terrible problem: There are organizations that cannot afford to take that kind of hit."
One example: Marcia Cypen, executive director of Legal Services of Greater Miami, which gets as many as 20,000 requests for help each year, recently decided not to renew a long-term lease on her group's South Dade offices, in large part because of the funding uncertainty. Cypen's group gets about $700,000 of its annual $4.5 million budget from the program. "I'm not panicking, but I'm not getting into any long-term commitments right now," she says.
In the Texas case, a divided U.S. Supreme Court ruled that interest on clients' money belongs to clients. A centuries-old rule that "interest follows principal" applies even if the deposits are too small to net any interest on their own, the court found. However, the court didn't rule that the Texas program, which copied Florida's, is unconstitutional. Instead, the Supreme Court sent the case back to a federal appeals court to decide whether the Texas government has unconstitutionally taken private property and whether the plaintiffs are entitled to compensation.
Supporters of the interest-collection program say the court's opinion applies only to Texas for now. Sonnett says he believes Florida's program will survive the case, which is expected to take at least another year to resolve. "I think the opponents have a much harder case to make" on the issues of constitutionality and compensation.
Opponents of the program, however, say Sonnett and other supporters are thinking wishfully - "people who don't want to admit they lost," says Altamonte Springs attorney Harvey Alper, president of the Attorney's Bar Association, a 600-member organization formed in opposition to the Florida Bar four years ago. "The Florida Bar is taking $14 million a year that the U.S. Supreme Court just said belongs to someone else."
Alper says he doesn't oppose helping the poor obtain legal services. But he believes the program should be voluntary, particularly since some clients may have ideological objections to some of the cases that legal services attorneys pursue. "The Bar has been running around for 20 years acting like lawyers have been giving money to worthy causes," Alper says. "It isn't the lawyers' money."
Alper brought the suit that led the U.S. Supreme Court in 1980 to end the practice of court clerks claiming the interest on funds deposited in court registries, and he is considering a lawsuit against the banks that comply with the program. "I really don't believe that the Florida Supreme Court believes that a decision of the U.S. Supreme Court in a Texas case only applies to Texas," he says.
Alper has written both to the Florida Supreme Court and to his own bank, demanding an end to the practice, but the court has declined to order a halt to the collection of the interest. If that becomes necessary, the program could be converted to a voluntary one, with lawyers and clients given the option to contribute to the program, but Cypen says that will mean time and money that could go directly to legal services will be diverted to promoting the program. In any event, she says, "the smart people will be out there raising money and not counting on anything."
Raising the Ante
Harassment Suits
Fort Lauderdale attorney William Amlong is the toast of the employment bar these days following a victory in the U.S. Supreme Court that will make it easier for sexual harassment plaintiffs to get before a jury. His win comes in the case of a Boca Raton lifeguard who sued the city and two supervisors in 1992, alleging she'd endured five years of lewd remarks and offensive behavior on the job. A federal district court judge found the city liable, but the case was reversed on appeal, in part because lifeguard Beth Ann Faragher never complained to the city and was never specifically threatened with firing or demotion. The U.S. Supreme Court, however, ruled that such circumstances don't necessarily protect an employer from liability.
"There's no question that employers should expect an increased number of filings" as a result of the opinion, says Miami lawyer Elizabeth Pryor Johnson, who represents employers. And they're probably going to cost more to resolve. "The threat of a jury trial is more acute now, which might up the ante when you start talking about settlement," Johnson says.
The best defense against harassment cases? A sexual harassment policy that filters down to the lowest level employees. "There's a bigger burden on management now to create a culture in which employees at the lowest level feel confident that they don't have to take abuse and that abusiveness will not be tolerated by higher-ups," says Amlong. Plaintiffs lawyers, he says, are "the easiest bunch of folks in the world to put out of business. Just stop it."