## Facts

- Lawline was an organization of lawyers, paralegals, and laypersons that answered legal questions for free and referred the public to agencies and reduced-fee lawyers.
- Illinois and the U.S. District Court for the Northern District of Illinois adopted ABA Model Rules of Professional Conduct 5.4(b) and 5.5(b).
- Rule 5.4(b) prohibited lawyers from forming partnerships with nonlawyers if any partnership activities constituted the practice of law.
- Rule 5.5(b) prohibited lawyers from assisting nonlawyers in conduct constituting the unauthorized practice of law.
- Plaintiffs alleged the rules, along with related interpretations and opinions, prevented their mixed lawyer–nonlawyer operation and excluded them from the market for legal advice and low-cost legal services.
- Plaintiffs also alleged that bankruptcy-related reports to disciplinary authorities triggered scrutiny of Lawline’s activities.
- Plaintiffs sued the ABA, state and local bar entities, judicial actors connected to the challenged rules, and various disciplinary and government officials.

## Issues

1. Whether promulgation and enforcement of Rules 5.4(b) and 5.5(b) by courts and related entities could support Sherman Act §§ 1–2 claims for restraint of trade or monopolization.
2. Whether the challenged rules and related actions violated the First Amendment, due process, or equal protection, actionable under 42 U.S.C. § 1983.
3. Whether judicial, quasi-judicial, and state-action immunity doctrines required dismissal of damages claims against courts, judges, and entities participating in bar regulation.

## Decision

- The Seventh Circuit affirmed dismissal of the amended complaint in full.
- Courts and judicial actors were immune from damages claims based on adopting and enforcing attorney-discipline and professional-conduct rules.
- The antitrust claims failed because the challenged conduct was governmental regulation of the legal profession, protected by state-action principles rather than treated as private market conduct.
- The constitutional claims were barred by immunity doctrines and, in any event, did not plead a substantive First Amendment, due process, or equal protection violation given the character of the rules as conventional professional regulation.
- Challenges directed at superseded Model Code provisions did not warrant relief where the operative rules in force were the adopted Model Rules.

## Legal Principles

- Regulation of the practice of law through court-promulgated ethics rules is a traditional governmental function.
- Judges and closely related officials have absolute or quasi-judicial immunity from damages for acts that are judicial in nature, including promulgation and enforcement of attorney-discipline rules.
- State-action immunity generally shields a state supreme court’s adoption and enforcement of professional-conduct rules from federal antitrust liability.
- Restrictions on lawyer–nonlawyer partnerships and on assisting unauthorized practice are ordinarily treated as rational regulations to protect clients and preserve professional independence, and do not, without more, establish First Amendment, due process, or equal protection violations.

## Conclusion

The Seventh Circuit held that antitrust and § 1983 challenges to rules barring lawyer–nonlawyer partnerships and assistance in unauthorized practice could not proceed because the complained-of conduct was protected governmental regulation of the legal profession and because immunity doctrines barred damages claims against the courts and related regulatory actors.


Lawline v. Am. Bar Ass’n, 956 F.2d 1378 (7th Cir. 1992)