Texas Ethics Opinion Clarifies Limits on Nondisparagement Clauses in Settlements

This month, the Texas Professional Ethics Committee issued Opinion No. 708, clarifying that attorneys licensed in Texas may not agree to settlement provisions that restrict their ability to practice law. The opinion interprets Rule 5.06(b) of the Texas Disciplinary Rules of Professional Conduct, which prohibits attorneys from participating in settlements that impose limitations on future legal representation or advocacy.

The committee considered a scenario in which plaintiff’s counsel was asked to agree to a nondisparagement clause binding both the client and the attorney. The proposed clause would have limited the attorney’s ability to speak about the matter, consult with prospective clients or advocate against the same opposing party in future litigation. The committee’s opinion concluded that such terms violate Rule 5.06(b), even if they do not expressly bar future representation.

However, the committee draws a distinction between professional and personal speech. For example, a clause that prohibits an attorney from referencing their experience with a certain type of case or party in future litigation would be impermissible. In contrast, a clause that restricts only personal commentary, such as a social media post unrelated to legal advocacy, would not violate Rule 5.06(b). Similarly, attorneys may agree to nondisclosure provisions that align with existing confidentiality duties under Rules 1.05 and 1.09, but may not accept terms that prevent them from describing their general experience or the types of matters they have handled.

Takeaway for Texas Litigators: Attorneys cannot be contractually restricted from engaging in future advocacy, discussing their professional experience or advising potential clients. Settlement terms that interfere with those activities cross an ethical line and should be rejected.