272 F.Supp.2d 1260 (D.N.M. 2003), 02-917, Stein v. Legal Advertising Committee of Disciplinary Bd.

Docket Nº:02-917 LFG.
Citation:272 F.Supp.2d 1260
Party Name:Stuart L. STEIN, and Stuart L. Stein, P.A., a professional law corporation d/b/a The Stein Law Firm, Plaintiffs, v. LEGAL ADVERTISING COMMITTEE OF THE DISCIPLINARY BOARD, et al., Defendants.
Case Date:July 24, 2003
Court:United States District Courts, 10th Circuit, District of New Mexico

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272 F.Supp.2d 1260 (D.N.M. 2003)

Stuart L. STEIN, and Stuart L. Stein, P.A., a professional law corporation d/b/a The Stein Law Firm, Plaintiffs,



No. 02-917 LFG.

United States District Court, D. New Mexico.

July 24, 2003

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[Copyrighted Material Omitted]

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Stuart L. Stein, Stuart L. Stein, PA, Albuquerque, for Plaintiffs.

Jerry A. Walz, Walz & Associates, Cedar Crest, for Defendants.


GARCIA, United States Magistrate Judge.

THIS MATTER is before the Court 1 on a Motion to Dismiss Based on the Principles of Abstention, Exhaustion, and/or Immunity [doc. 21] filed by Defendants Legal Advertising Committee of the Disciplinary Board ("LAC"), Kelly A. Genova, Chair, Stan Harris, Suzanne M. Barker, C. Brian Charlton, John P. Cosentino, Michael P. Fricke, Troy W. Prichard, Gregory P. Sherman, Diane Helgevold, Barbara Montoya, and Dr. Phillip J. Simmons, all members of the LAC ("members of the LAC"), the Disciplinary Board of the Supreme Court of the State of New Mexico ("Disciplinary Board"), Edward L. Chavez, Chair, James F. Beckley, Carmen E. Garza, Michael H. Hoses, Robert S. Murray, Richard J. Parmley, Jr., Mike G. Paulowsky, Dorothy S. Peters, Sasha Siemel, and Victor A. Titus, all members of the Disciplinary Board ("members of the Disciplinary Board"); the Honorable Patricio M. Serna, the Honorable Joseph F. Baca, the Honorable Gene E. Franchini, the Honorable Pamela B. Minzner, and the Honorable Petra Jimenez Maes, the Chief Justice and Justices of the Supreme Court of New Mexico ("Justices of the New Mexico Supreme Court"). 2 Defendants request dismissal of this lawsuit under Rules 12(b)(1) and/or (6) 3 of the Federal Rules of Civil Procedure, based on their argument that the Court should abstain, under principles of Younger, from considering the merits of an ongoing disciplinary action taken against Plaintiff Stuart L. Stein ("Stein"). Alternatively, Defendants contend that Plaintiffs should be required to exhaust their state remedies before being permitted to proceed in federal court. Finally,

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Defendants argue that should the Court retain jurisdiction of this matter, all Defendants are entitled to immunity from suit. [Doc. 22.]

Plaintiffs contend that Defendants have not met all of the prongs of the Younger Abstention Doctrine, that Plaintiffs have exhausted their state remedies and that the Defendants are not entitled to immunity, with the exception of the New Mexico Supreme Court justices. Plaintiffs also argue that Defendants consented to the federal court's jurisdiction. Plaintiffs further request that should the Court intend to grant this Motion to Dismiss, it hold in abeyance the ruling while permitting a reasonable time for discovery on these issues and an opportunity for Plaintiffs to supplement their opposition brief.

No oral argument is necessary in resolving this motion. After carefully considering the briefing and the pertinent law, the Court concludes that Defendants' Motion to Dismiss based on grounds of Younger abstention should be granted. In addition, principles of exhaustion require that Plaintiffs exhaust their state remedies before proceeding with the federal lawsuit. Because of the Court's ruling, it does not reach Defendants' arguments regarding immunity, 4 although Defendants may elect to reassert those arguments, should this case be reinstated after the disciplinary proceedings against Stein are concluded. The Court concludes that no additional discovery is necessary before ruling on this matter and therefore, denies Plaintiffs' request to hold its ruling in abeyance pending further discovery and briefing. The Court disagrees that there is evidence demonstrating that Defendants consented to federal court jurisdiction of these claims. Therefore, this case will be dismissed, without prejudice, based on principles of Younger abstention and exhaustion.

Procedural and Factual Background

The focus of this dispute is legal advertising. Stein is an attorney admitted to practice law in the State of New Mexico. Stuart L. Stein, P.A. is a Florida professional corporation with its main office in Albuquerque, New Mexico. Plaintiffs' practice is devoted primarily to the area of estate planning. Plaintiffs are suing the Legal Advertising Committee and the Disciplinary Board, along with the individual members of each of these entities in relation to legal advertising issues.

Plaintiffs claim that for years they have been submitting advertising copy or scripts to the Legal Advertising Committee prior to public dissemination in accordance with the New Mexico Legal Advertising Rules. [First Amended Complaint.] In the past, some of Plaintiffs' ads have been rejected and some approved. [ Id. at ¶ 21.] With respect to the current advertising disputes at issue, Plaintiffs explain that this matter escalated upon receipt of a letter, dated June 28, 2002, that threatened disciplinary action against Stein "after almost two years of conflict" between Plaintiffs and Defendants. [Doc. 3, at 5.]

The June 28, 2002 letter to Stein from the Disciplinary Board notified Stein of changes or deletions that needed to be made in Plaintiffs' estate planning seminar advertisements. Stein was told to remove testimonials from newspaper ads on grounds that testimonials are prohibited by Supreme Court rule. Stein claimed that he had previously been permitted by the Legal Advertising Committee to use testimonials and therefore had a vested right in continuing to use testimonials.

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The Disciplinary Board letter also advised Stein to change or remove the word "steal" from this ad: "Probate and death taxes can steal more than 50% from your children's inheritance!" The letter addressed other advertisements of Plaintiffs and informed Stein what language had to be removed or changed. In addition, the letter stated that if Stein was willing to make the proposed changes, a recommendation would be made that Stein receive an Informal Admonition for violations of the pertinent rules. Otherwise, formal disciplinary charges "will be filed to address these issues." Stein was to respond to the letter by July 15, 2002. [Doc. 14, Ex. A.]

On July 1, 2002, Stein wrote to the Deputy Chief Disciplinary Counsel for the Disciplinary Board requesting additional time until August 5 before responding to the June 28 letter. He noted that the "file had been open and ongoing for over a year and a half ...". Stein was granted an extension.

On July 29, 2002, "once it was understood that ... [Defendants] would file a future disciplinary action against ... Stein" [doc. 39], Plaintiffs filed this Complaint for Preliminary Relief, Declaratory Judgment and Damages [doc. 1] in federal court. On July 30, 2002, Plaintiffs filed a Motion for Preliminary Injunction, seeking to prohibit Defendants from bringing any disciplinary actions against Stein based on claimed violations to New Mexico's Legal Advertising Rules, pending resolution of this lawsuit. [Doc. 2.] Before Defendants answered 5 the initial Complaint, Plaintiffs filed a First Amended Complaint for Preliminary Relief, Declaratory Judgment and Damages ("Amended Complaint"). [Doc. 12.] The Amended Complaint alleges First Amendment violations, Due Process violations and Equal Protection violations and is brought under 42 U.S.C. § 1983.

Specifically, Plaintiffs request a preliminary injunction against Defendants from bringing any disciplinary complaint against Plaintiffs related to certain legal advertisements, a Declaratory Judgment that the advertisements at issue are protected commercial speech and not subject to restrictions sought by Defendants, a finding that Defendants have unconstitutionally applied SCRA§§ 16-701 et seq. to Plaintiffs, damages in excess of $100,000.00, attorneys fees, and specific additional or modified legal advertising rules and/or other assurances from Defendants. [Doc. 12.]

On October 16, 2002, Defendants filed this Motion to Dismiss [doc. 21], a Motion for Partial Summary Judgment on the First Amendment Claims [doc. 19], a Motion for Partial Summary Judgment on the Due Process Claims [doc. 23], and a Motion for Partial Summary Judgment on the Equal Protection Claims [doc. 25]. All of these motions are fully briefed, and Plaintiffs have submitted a number of exhibits in support of their responsive pleadings, including the legal advertisements at issue and correspondence between the parties.

On October 29, 2002, the Disciplinary Board filed a Disciplinary Complaint or formal charges against Stein before the Disciplinary Board of the Supreme Court of the State of New Mexico [Disc. No. 10-2002-445.] The Disciplinary Complaint specified the charges against Stein related to legal advertising and alleged violations of the Rules of Professional Conduct. The Complaint directed that a hearing committee be designated to hear the evidence and make findings of facts and recommendations to the Disciplinary Board and that Stein be disciplined and assessed costs of the proceeding. It appeared initially that counsel would agree to temporarily stay these disciplinary proceedings until the Court resolved the motion to dismiss.

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However, Defendants subsequently would only agree to a stay of 30 days (until December 19, 2002), in relation to the disciplinary complaint. [Doc. 35].

In anticipation of the current stay expiring on December 19, 2002, Plaintiffs filed a Motion for Temporary Restraining Order [doc. 39]. On December 17, 2002, the parties stipulated to a stay of the disciplinary proceedings for an additional 30 days, or until about January 16, 2003, due to a reassignment of judges. [Doc. 42.] That stay has...

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