Relating to civil liability for prohibited barratry.

Contracts

• Marketing Vendor Agreements: Immediately amend Master Services Agreements (MSAs) with lead generators and marketing agencies. Insert specific indemnification clauses requiring vendors to cover the $50,000 statutory penalty and legal fees if their lead generation methods violate Texas Disciplinary Rules of Professional Conduct.
• Employment Agreements: Update contracts for investigators, intake specialists, and liaison staff to explicitly prohibit direct solicitation. Include termination-for-cause provisions to mitigate vicarious liability claims against the business entity.

Hiring/Training

• Intake Scripting: Retrain intake staff to verbally verify and record the "origin of contact" for every potential client. Staff must be trained to identify and reject leads that appear to be the result of "runner" activity or unrequested solicitation.
• Prohibited Incentives: Audit compensation structures. Ensure no non-lawyer employees or external partners (e.g., chiropractors, body shops) receive compensation calculated by the number of referrals to legal counsel.

Reporting & Record-Keeping

• Chain of Custody: Implement mandatory fields in your CRM (e.g., Salesforce, Filevine) to document the specific marketing channel for every client. "Referral" is insufficient; you must document *who* referred the client and confirm no value was exchanged for that referral.
• Non-Solicitation Affidavits: For high-risk practice areas (Personal Injury/Mass Tort), require new clients to sign an affidavit at intake confirming they initiated contact voluntarily and were not approached by a third party.

Fees & Costs

• Uninsurable Losses: The $50,000 penalty is a statutory fine, not compensatory damages. Consequently, it is likely excluded from coverage under standard General Liability and Legal Malpractice insurance policies. This cost will hit your bottom line directly.
• Litigation Settlement Floors: Expect the "nuisance value" of barratry claims to rise. Plaintiffs' counsel will use the $50,000 statutory floor as the starting point for settlement negotiations.