Establishing Heightened Advertising Compliance Requirements for Unlicensed Lawyers in South Carolina

Introduction

In In the Matter of Michael George Hostilo, the Supreme Court of South Carolina addressed the extent to which an attorney admitted in another jurisdiction—but not licensed in South Carolina—may advertise legal services within the state. Michael George Hostilo, a Georgia‐licensed lawyer who employs South Carolina attorneys and promotes services in South Carolina, entered into a consent agreement admitting multiple advertising violations. The Office of Disciplinary Counsel (ODC) and Hostilo stipulated to discipline ranging from a confidential admonition to a public reprimand. The Court accepted the agreement and imposed a public reprimand, reinforcing the state’s commitment to rigorous enforcement of its Rules of Professional Conduct.

Key issues:

• Applicability of South Carolina advertising rules to unlicensed practitioners (Rule 418, SCACR).
• Prohibited communications—material misrepresentations, unjustified result expectations, impermissible comparisons, improper fee statements, missing disclaimers.
• Supervisory and record‐keeping obligations for all advertisements.

Summary of the Judgment

The Court accepted an Agreement for Discipline by Consent under Rule 21 of the Rules for Lawyer Disciplinary Enforcement (RLDE). Hostilo admitted that his firm’s website, YouTube video, and billboard advertisements violated multiple provisions of Rule 7.1 (truthfulness, non-misleading statements), Rule 7.2 (advertisement content requirements), and Rule 7.4 (use of the term “expert”) of the South Carolina Rules of Professional Conduct (Rule 407, SCACR). Specifically, he made material misrepresentations about years of service, misstated a statute of limitations, created unjustified client expectations, failed to include required disclaimers (e.g., fee arrangements, endorsements), and did not supervise or archive his advertising content properly. The Court publicly reprimanded Hostilo and ordered him to pay investigation and prosecution costs within 30 days.

Analysis

Precedents Cited

The Court relied principally on In re Wells, 392 S.C. 371, 709 S.E.2d 644 (2011), where a South Carolina‐licensed attorney was publicly reprimanded and fined for similar advertising violations. Wells established that:

• Material misrepresentations and unjustified expectations in legal advertising warrant public discipline.
• Lawyers must identify responsible attorneys, disclose fee arrangements and office locations, and ensure disclaimers are conspicuous.
• Repeated or extensive violations can lead to fines in addition to reprimands.

By analogizing to Wells, the Court underscored that unlicensed lawyers face identical standards when advertising to South Carolina residents.

Legal Reasoning

1. Jurisdiction over Unlicensed Lawyers: Under Rule 418(a)-(d), SCACR, an attorney admitted elsewhere but not in South Carolina is deemed an “unlicensed lawyer.” Any advertising or solicitation within the state triggers the state’s disciplinary jurisdiction and subjects the attorney to the same Professional Conduct Rules as locally licensed practitioners.

2. Truthfulness and Non-Misleading Advertisements: Rule 7.1(a)-(d) prohibits material misrepresentations, unjustified expectations, and unsubstantiated comparisons. Hostilo’s statements about “nearly 30 years” of practice in South Carolina, inflated recovery figures without context, and comparisons to other firms violated these prohibitions.

3. Advertisement Content Requirements: Rule 7.2(a), (b), (d), (f), (h), (i) requires that all ads be predominantly informational, bear the responsible lawyer’s name and address, include clear and conspicuous disclaimers regarding fees and endorsements, and specify where services are performed. Hostilo’s website and billboard omitted or minimized these elements.

4. Use of “Expert”: Rule 7.4(b) bars the term “expert” unless formally certified. Hostilo’s unauthorized use of that term misled potential clients about credentials.

5. Supervisory and Record-Keeping Duties: Under Rule 7.2(b), a lawyer must review all advertisements before publication and maintain complete records. Hostilo conceded he failed both to review content and to archive it as required.

Impact

This decision has several significant effects:

• Clarifies that unlicensed attorneys marketing in South Carolina will be disciplined under the same advertising rules as local lawyers.
• Reinforces the need for rigorous internal review processes for marketing materials—websites, videos, billboards, and social media.
• Elevates the importance of accurate disclaimers: fee structures, result disclaimers, endorsements, and geographic practice locations.
• Signals that even inadvertent or copy-and-paste errors in advertising content can lead to public reprimands.
• Encourages engagement of local ethics counsel to audit marketing compliance proactively.

Complex Concepts Simplified

• Unlicensed Lawyer (Rule 418, SCACR): A lawyer admitted in another jurisdiction but not in South Carolina. Such attorneys must follow South Carolina’s advertising rules when marketing within the state.
• Material Misrepresentation (Rule 7.1(a)): Any false or misleading statement of fact or law that could influence a prospective client’s decision to retain a lawyer.
• Unjustified Expectations (Rule 7.1(b)): Promises or implications of results that the lawyer cannot guarantee, creating unrealistic client hopes.
• Predominantly Informational (Rule 7.2(a)): An advertisement’s main purpose must be to convey factual details—contact information, services offered—rather than persuasive or promotional messaging.
• Conspicuous Disclaimers (Rule 7.2(i)): Required statements (e.g., “results depend on case specifics”) must be easily readable and noticeable by an average viewer.

Conclusion

In the Matter of Michael George Hostilo establishes a clear, enforceable precedent: attorneys not licensed in South Carolina who advertise within the state must fully comply with all aspects of the Rules of Professional Conduct governing truthfulness, disclosures, and supervision. Courts will impose public discipline for substantive misrepresentations, unjustified result expectations, improper fee statements, and failures in oversight. As a result, law firms operating across jurisdictions should implement robust compliance audits, engage local ethics counsel, and maintain accurate, well‐documented records of all marketing materials to avoid similar sanctions.