File v. Martin

• Decision Date: 29 April 2022
• Docket Number: 20-2387
• Citation: 33 F.4th 385
• Parties: Schuyler FILE, Plaintiff-Appellant, v. Larry MARTIN, Executive Director of the State Bar of Wisconsin, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

33 F.4th 385

Schuyler FILE, Plaintiff-Appellant,

v.Larry MARTIN, Executive Director of the State Bar of Wisconsin, et al., Defendants-Appellees.

No. 20-2387

United States Court of Appeals, Seventh Circuit.

Argued January 15, 2021

Decided April 29, 2022

Daniel R. Suhr, Attorney, Liberty Justice Center, Chicago, IL, for Plaintiff-Appellant.

Roberta F. Howell, Attorney, Andrew C. Gresik, Foley & Lardner LLP, Madison, WI, for Defendants-Appellees Jill M. Kastner, Larry Martin.

Clayton P. Kawski, Sean Michael Murphy, Attorneys, Office of the Attorney General, Wisconsin Department of Justice, Madison, WI, for Defendants-Appellees Patience D. Roggensack, Ann W. Bradley, Annette K. Ziegler, Rebecca Bradley, Daniel Kelly, Rebecca Frank Dallet, Shirley S. Abrahamson.

Before Sykes, Chief Judge, and Wood and Hamilton, Circuit Judges.

Sykes, Chief Judge.

Under rules adopted and enforced by the Wisconsin Supreme Court, all lawyers licensed to practice in the state must be members of and pay dues to the State Bar of Wisconsin, a professional association created by the court. Attorney Schuyler File contends that requiring him to join and subsidize the State Bar violates his free-speech and associational rights under the First Amendment. Recognizing that Supreme Court precedent forecloses this claim, see Keller v. State Bar of Cal. , 496 U.S. 1, 110 S.Ct. 2228, 110 L.Ed.2d 1 (1990), File maintains that the Court's more recent cases—particularly Janus v. American Federation of State, County, & Municipal Employees, Council 31 , ––– U.S. ––––, 138 S. Ct. 2448, 201 L.Ed.2d 924 (2018) —implicitly overruled Keller.

The district court rejected this argument, and properly so. Keller may be difficult to square with the Supreme Court's more recent First Amendment caselaw, but on multiple occasions and in no uncertain terms, the Court has instructed lower courts to resist invitations to find its decisions overruled by implication. Keller is binding. We affirm.

I. Background

Wisconsin lawyers must join and pay annual dues to the State Bar of Wisconsin, and active membership in the association is "a condition precedent to the right to practice law" in the state. WIS. S. CT. R. 10.01(1) ; see also id. R. 10.03(5) (establishing the dues requirement); id. R. 23.02(1) (providing that no person may practice law in the state without a current license issued by the Wisconsin Supreme Court and active membership in the State Bar). This regulatory regime, often called an "integrated, mandatory[,] or unified bar," Kingstad v. State Bar of Wis. , 622 F.3d 708, 713 n.3 (7th Cir. 2010) (quotation marks omitted), authorizes the State Bar to use membership dues to fulfill the purposes for which it was created. These include "aid[ing] the courts in ... the administration of justice"; "conduct[ing] a program of continuing legal education"; and "maintain[ing] ... high ideals of integrity, learning, competence[,] ... public service[,] and high standards of conduct" in the bar of the state. WIS. S. CT. R. 10.02(2). To those ends, the State Bar hosts seminars, sponsors amicus briefs, publishes a magazine, proposes legal-ethics rules, and lobbies the government. Some of these activities venture into political and socially sensitive subjects.

Failing to pay bar dues can result in serious consequences. Attorneys who fail to pay dues by the annual due date and remain delinquent after notice and the expiration of a specified grace period are automatically suspended. WIS. STATE BAR BY - LAWS art. I, § 3(a). (The administrative suspension is lifted if the delinquent lawyer pays the late dues plus a small penalty, but this remedy is not available if the dues have been in arrears for three years. Id. art. I, § 3(c).)

Suspended lawyers cannot practice law. Id. ; see also WIS. S. CT. R. 23.02(1). The state supreme court and every judge in the state receives a certified list of all lawyers suspended for nonpayment of dues. WIS. STATE BAR BY - LAWS art. I, § 3(a). Practicing law while suspended violates state legal-ethics rules. WIS. S. CT. R. 20:8.4(f).

The Office of Lawyer Regulation—the court agency that investigates and prosecutes ethics violations—may initiate proceedings to impose additional sanctions, including full license suspension. See, e.g., In re FitzGerald , 304 Wis.2d 592, 735 N.W.2d 913, 916 (Wis. 2007). But the Wisconsin Supreme Court, which has plenary constitutional power to regulate the legal profession in the state, is the ultimate enforcement authority for the lawyer regulatory system—including the licensing rules, bar-membership requirement, and the ethics code—and imposes discipline for violations. WIS. S. CT. R. 21.09 ; see also id. R. 21 pmbl. ("The lawyer regulation system is established to carry out the supreme court's constitutional responsibility to supervise the practice of law ...."). The Office of Lawyer Regulation acts pursuant to the court's authority and is the court's agent for investigating and prosecuting violations. See id. R. 21.13.

Schuyler File is an active, dues-paying member of the State Bar. But he does not want to be. He filed suit challenging the constitutionality of the mandatory bar, naming the association's executive director and its president and the justices of the state supreme court as defendants. He sought a declaration that the mandatory bar is facially incompatible with the First Amendment and an injunction prohibiting the defendants from enforcing the membership and dues requirements.

The justices and State Bar officials filed separate motions to dismiss for lack of subject-matter jurisdiction and failure to state a claim. See FED. R. CIV. P. 12(b)(1), (b)(6). Both sets of defendants argued that the Supreme Court's decision in Keller precludes File's claim on the merits. The justices also challenged File's standing to sue, arguing that his injury is hypothetical at best and not traceable to them. Additionally, the justices raised a defense of immunity.

The judge rejected the jurisdictional argument, holding that the injury File would suffer if he stopped paying bar dues—automatic suspension of his right to practice law—is certain enough to support his standing to bring this pre-enforcement suit for prospective relief. File v. Kastner , 469 F. Supp. 3d 883, 886–87 (E.D. Wis. 2020). The judge also rejected the justices' immunity claim, relying on Pulliam v. Allen , 466 U.S. 522, 541–42, 104 S.Ct. 1970, 80 L.Ed.2d 565 (1984). File , 469 F. Supp. 3d at 888. Moving to the merits, the judge dismissed the case, ruling that File's claim "is foreclosed by Keller , which only the Supreme Court may overrule." Id. at 891.

II. Discussion

We review the judge's dismissal order de novo. Price v. City of Chicago , 915 F.3d 1107, 1110 (7th Cir. 2019). Our first order of business is the question of standing. The justices (but not the State Bar officials) argue that File alleged nothing more than a hypothetical injury and thus lacks standing to sue.

Article III limits the federal judicial power to "Cases" and "Controversies," which in turn requires the party invoking the jurisdiction of the federal court to establish his standing to sue. Spokeo, Inc. v. Robins , 578 U.S. 330, 338, 136 S.Ct. 1540, 194 L.Ed.2d 635 (2016). To do so, the plaintiff "must demonstrate (1) that he or she suffered an injury in fact that is concrete, particularized, and actual or imminent, (2) that the injury was caused by the defendant, and (3) that the injury would likely be redressed by the requested judicial relief." Thole v. U.S. Bank N.A. , ––– U.S. ––––, 140 S. Ct. 1615, 1618, 207 L.Ed.2d 85 (2020).

As noted, this is a pre-enforcement suit: File seeks prospective relief based on the threat of injury—suspension of his right to practice law—if he were to refuse to pay bar dues. "It is well-established that pre-enforcement challenges are within Article III." Ezell v. City of Chicago , 651 F.3d 684, 695 (7th Cir. 2011) (quotation marks and alterations omitted). For this type of claim, the Article III minimums are satisfied when "there exists a credible threat of prosecution." Susan B. Anthony List v. Driehaus , 573 U.S. 149, 159, 134 S.Ct. 2334, 189 L.Ed.2d 246 (2014) (quotation marks omitted). A person need not violate the law and risk prosecution to bring a pre-enforcement challenge. Ezell , 651 F.3d at 695 ; see also Schirmer v. Nagode , 621 F.3d 581, 586 (7th Cir. 2010). A credible threat of prosecution is sufficient to establish injury in fact; an actual prosecution or other enforcement action is not necessary. Driehaus , 573 U.S. at 159, 134 S.Ct. 2334.

The justices insist that the threat of disciplinary action against File is entirely hypothetical. That's a puzzling argument in the context of this regulatory scheme. An attorney who fails to pay bar dues is administratively suspended from the practice of law, and every judge in the state receives a list of suspended lawyers. Practicing law while administratively suspended is an ethics violation subject to additional discipline. Under the court's own rules, there is more than a credible threat of enforcement: the penalty for nonpayment of dues—administrative suspension of the right to practice law—is automatic and universally applicable.

It does not matter that the State Bar processes administrative suspensions or that the Office of Lawyer Regulation initiates misconduct proceedings against lawyers who practice law while suspended. As we've explained, the Wisconsin Supreme Court is the ultimate regulatory authority for the practice of law in the state; it promulgates and enforces the rules governing attorney licensure, bar membership, and ethics. The respective roles of the State Bar and the Office of Lawyer Regulation flow directly from the court.

The justices rely on Crosetto v. State Bar of Wisconsin , 12 F.3d 1396 (7th Cir. 1993), but the relevant holding in that case is narrow and does not support their contention that File lacks standing to sue in federal court. Like this case, Crosetto was a challenge to...