Indicates Matter Stricken

Indicates New Matter

 

Committee Report

March 3, 2026

 

S. 821

 

Introduced by Senators Bennett and Turner

 

S. Printed 3/3/26--S.

Read the first time January 15, 2026

 

________

 

The committee on Senate Labor, Commerce and Industry

To whom was referred a Bill (S. 821) to amend the South Carolina Code of Laws by amending Section 39-5-39, relating to an attorney advertising in a false, deceptive, or misleading manner, so as to define, etc., respectfully

Report:

That they have duly and carefully considered the same, and recommend that the same do pass with amendment:

 

   Amend the bill, as and if amended, SECTION 1, by striking Section 39-5-39(B) and inserting:

    (B) Notwithstanding another provision of law, it is an unlawful trade practice, pursuant to Section 39-5-20, for an attorney to advertise his a person or entity, including a third-party generator or referral service, to create, sponsor, finance, or disseminate advertising for legal services in this State in a false, deceptive, or misleading manner including, but not limited to, the use of a nickname that creates an unreasonable expectation of results.

Amend the bill further, SECTION 1, by striking Section 39-5-39(E) and (F) and inserting:

    (E) Any advertising for legal services, in whatever form or medium, must disclose clearly and conspicuously, in close proximity and in a similar size, the identity of the attorney or law firm that will be primarily responsible for the client's representation or a clear explanation of how the matter will be referred to an attorney or law firm.

    (E)(F) A violation of subsections (C), or (D), or (E) constitutes an unfair trade practice enforceable exclusively by the Department of Consumer Affairs who shall seek both monetary and injunctive relief.

    (F)(G) A violation of this section does not create any private cause of action for a violation of this section.

Amend the bill further, by adding an appropriately numbered SECTION to read:

SECTION X. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

Renumber sections to conform.

Amend title to conform.

 

THOMAS DAVIS for Committee.

 

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A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 39-5-39, RELATING TO AN ATTORNEY ADVERTISING IN A FALSE, DECEPTIVE, OR MISLEADING MANNER, SO AS TO DEFINE FALSE ADVERTISING; TO PROVIDE THAT ANY ADVERTISING FOR LEGAL SERVICES THAT REFERENCES A SETTLEMENT OBTAINED ON BEHALF OF A CLIENT MUST DISCLOSE THE AMOUNT OF ATTORNEY'S FEES AND LITIGATION COSTS DEDUCTED FROM THE RECOVERY; TO REQUIRE THE LEGAL ADVERTISEMENT TO CLARIFY THAT ANY REFERENCED RESULTS ARE NOT REPRESENTATIVE OF ALL CASES AND THAT OUTCOMES DEPEND ON THE SPECIFIC FACTS OF EACH CASE; AND TO PROVIDE THAT ANY ADVERTISING FOR LEGAL SERVICES THAT STATES THAT THE FILING OF A LAWSUIT IS AGAINST AN INSURANCE COMPANY OR OTHER THIRD PARTY MUST DISCLOSE THE FACT THAT ANY LAWSUIT WOULD BE FILED AGAINST AN INDIVIDUAL OR BUSINESS THAT WOULD BE NAMED AS THE DEFENDANT AND THAT THE INSURANCE COMPANY IS ONLY PROVIDING THE COVERAGE ON BEHALF OF THE NAMED INDIVIDUAL OR BUSINESS BASED ON A POLICY PURCHASED BY THE INDIVIDUAL OR BUSINESS.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Section 39-5-39 of the S.C. Code is amended to read:

 

    Section 39-5-39. (A) Advertising shall be deemed false, deceptive, or misleading if it:

       (1) contains any statement, implication, or inference that guarantees, assures, or promises a particular outcome, recovery, verdict, settlement amount, or success rate;

       (2) suggests that past results, case outcomes, or client recoveries are indicative of future results, unless accompanied by a clear and prominent statement that prior results do not guarantee a similar outcome; or

       (3) uses superlative, comparative, or predictive language that cannot be substantiated and that would reasonably lead a prospective client to expect results that are not typical or reasonably achievable.

    (B) Notwithstanding another provision of law, it is an unlawful trade practice, pursuant to Section 39-5-20, for an attorney to advertise his services in this State in a false, deceptive, or misleading manner including, but not limited to, the use of a nickname that creates an unreasonable expectation of results.

    (C)(1) Any advertising for legal services, in whatever form or medium, that references, depicts, or states a specific dollar amount of a settlement, verdict, judgment, or recovery obtained on behalf of a client must clearly and conspicuously disclose, in close proximity and in a similar size to the referenced dollar amount, the amount or percentage of attorney fees deducted from the recovery and the amount of litigation costs or expenses deducted from the recovery.

       (2) Such advertising for legal services must also disclose, in a clear and prominent manner, that the referenced result is not representative of all cases and that outcomes depend on the specific facts and legal circumstances of each matter.

    (D) Any advertising for legal services, in whatever form or medium, that references, depicts, or states that the filing of a lawsuit or legal claim or suggesting that the lawsuit or claim is against an insurance company or other third party must disclose clearly and conspicuously, in close proximity and in a similar size, the following disclosure or substantially similar language: "Any lawsuit would be filed against an individual or business that would be named as the defendant and that the insurance company is only providing the coverage on behalf of the named individual or business based on a policy purchased by the individual or business."

    (E) A violation of subsections (C) or (D) constitutes an unfair trade practice enforceable exclusively by the Department of Consumer Affairs who shall seek both monetary and injunctive relief.

    (F) A violation of this section does not create any private cause of action for a violation of this section.

 

SECTION 2.  This act takes effect upon approval by the Governor.

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