Case Name: CINCINNATI INSURANCE COMPANY (Intervenor Below), Celina Insurance Group (Defendants Suters' Insurer Below), Keith L. Faber (Defendants Suters' Counsel Below), Robert Suter and Betty Suter (Defendants Below), Appellants, v. David J. WILLS and Marcia Wills (Plaintiffs Below), and Elaine Mellinger (Defendant Below), Appellees
Court: Supreme Court of Indiana
Jurisdiction: Indiana
Decision Date: 1999-10-06
Citations: 717 N.E.2d 151
Docket Number: No. 79S00-9808-CV-458
Parties: CINCINNATI INSURANCE COMPANY (Intervenor Below), Celina Insurance Group (Defendants Suters’ Insurer Below), Keith L. Faber (Defendants Suters’ Counsel Below), Robert Suter and Betty Suter (Defendants Below), Appellants, v. David J. WILLS and Marcia Wills (Plaintiffs Below), and Elaine Mellinger (Defendant Below), Appellees.
Judges: SHEPARD, C.J., and SULLIVAN and SELBY, JJ., concur.
Reporter: North Eastern Reporter 2d
Volume: 717
Pages: 151–183

Head Matter:
CINCINNATI INSURANCE COMPANY (Intervenor Below), Celina Insurance Group (Defendants Suters’ Insurer Below), Keith L. Faber (Defendants Suters’ Counsel Below), Robert Suter and Betty Suter (Defendants Below), Appellants, v. David J. WILLS and Marcia Wills (Plaintiffs Below), and Elaine Mellinger (Defendant Below), Appellees.
No. 79S00-9808-CV-458.
Supreme Court of Indiana.
Oct. 6, 1999.
Judy L. Woods, Indianapolis, Indiana, Joseph T. Bumbleburg, Michael J. Staple-ton, Lafayette, Indiana, Norman T. Funk, Keith A. Kinney, Indianapolis, Indiana, Attorneys for Appellants.
Norman P. Metzger, Legal Services Organization of Indiana, Kenneth J. Falk, Indiana Civil Liberties Union, Timothy J. O’Connell, UAW Legal Services Plan, Ronald E. Elberger, George T. Patton, Jr., American International Group, Inc., American Insurance Association, National Association of Indiana Insurers, Scott Newton, Child Advocates, Inc., John A. Floreancig, Indianapolis Legal Aid Society, Indianapolis, Indiana, Attorneys for Amici Curiae.
William W. Hurst, Todd R. Ryden, Jon D. Krahulik, Indianapolis, Indiana, Jeffrey A. Cooke, Lafayette, Indiana, Attorneys for Appellees.
James D. Johnson, Defense Trial Counsel of Indiana, Evansville, Indiana, Leonard E. Eilbacher, James P. Fenton, Indiana State Bar Association, Fort Wayne, Indiana, Gregory H. Miller, Indiana Trial Lawyers Association, The Ass’n of Trial Lawyers of America, Craw-fordsville, Indiana, William F. Harvey, Steven C. Shockley, Maggie L. Smith, In-House Insurance Counsel, Stephen J. Peters, Richard Winegardner, Marjorie H. Lawyer-Smith, Indiana Chamber of Commerce, Indiana Legal Education Foundation, Inc., American Corporate Counsel Association, Cinergy Services, Inc., Indiana Manufacturers Association, Insurance Institute of Indiana, Inc., Association of Life Insurance Companies, Ronald Gif-ford, Elizabeth Cierzniak, State Farm Mutual Automobile Ins. Co., Indianapolis, Indiana, Attorneys for Amici Curiae.

Opinion:
ON PETITION FOR EMERGENCY TRANSFER
BOEHM, Justice.
This case deals with the increasingly common practice of defense of claims litigation by insurance company house counsel. We hold that an insurance company does not necessarily engage in the unauthorized practice of law when it employs house counsel to represent its insureds and that attorneys who are employees of an insurance company do not assist the insurer in the unauthorized practice of law when they represent the insureds. We also find no inherent conflict in such an arrangement but agree that conflicts may arise. For that reason, among others, accurate disclosure of the arrangement is required. Finally, we hold that the use of a law-firm-like name, specifically "Berlon & Timmel," to describe employee-attorneys is prohibited by Professional Conduct Rule 7.2 because it misleadingly suggests that they are outside counsel.
Factual and Procedural Background
David and Marcia Wills (the "Wills") asserted personal injury claims against Elaine Mellinger and Betty Suter. Suter was insured by Celina Insurance Group, who selected its house counsel, Keith Fa-ber, to defend Suter. Suter was advised that although Faber was employed and paid by Celina, his ethical obligations were owed to Suter alone. After consultation with another attorney, Suter agreed to the representation.
The Wills moved to disqualify Faber as Suter's counsel on the ground that his representation of Suter resulted in Celina's unauthorized practice of law. Cincinnati Insurance Company then moved to intervene, claiming an interest in the Wills' motion to disqualify Faber based on Cincinnati's practice of providing Indiana counsel for its insureds through Berlon & Timmel, which it described as a "captive law firm." The trial court granted Cincinnati's motion to intervene, and the subsequent record established that Berlon & Timmel is staffed exclusively by employees of Cincinnati who represent only Cincinnati's insureds and Cincinnati itself.
The trial court concluded that Celina engaged in the unauthorized practice of law by providing representation of its insureds through house counsel, and that Faber violated Professional Conduct Rule 5.5(b) by assisting Celina in the unauthorized practice of law. Accordingly, the trial court issued an order on June 11, 1998, granting the Wills' motion to disqual ify Faber "so long as he continues to be an employee or agent of Celina Insurance Group such that his participation aids and abets the unauthorized practice of law by Celina." The trial court also addressed the "captive law firm" issue raised by Cincinnati's intervention and concluded that Cincinnati, in addition to the unauthorized practice of law, also engaged in deceptive practices by using the name "Berlon & Timmel." Finally, the trial court found that the attorneys employed by Cincinnati were participating in deceptive practices and aiding the unauthorized practice of law. The trial court ordered both Celina and Cincinnati to stop "any and all practices and activities that could, under the findings of this order, be considered to constitute the unauthorized practice of law .," and found that Cincinnati "should close" its Indianapolis office operated as Berlon & Timmel.
After the Court of Appeals stayed the trial court's orders, but before any decision on the appeal, Celina and Faber petitioned for immediate transfer to this Court under Appellate Rule 4(A)(9), and transfer was granted.
I. Jurisdiction of the Trial Court
A trial court may disqualify an attorney for a violation of the Rules of Professional Conduct that arises from the attorney's representation before the court. State v. Romero, 578 N.E.2d 673, 676-77 (Ind.1991) (disqualifying former prosecutor who attempted to represent a defendant in a matter substantially related to a prior prosecution without the State's consent in violation of Professional Conduct Rule 1.11's duty to maintain confidences of the State, his former client). The trial court's authority has been described as necessary to prevent "insult and gross violations of decorum," and that authority is limited to attorneys appearing before the court. McQueen v. State, 272 Ind. 229, 231, 396 N.E.2d 903, 904 (1979). More precisely, the authority of the trial court is limited to disqualification in the case before the court. Disqualification of Faber in the suit by the Wills against Suter was within the trial court's jurisdiction in this case.
The trial court's order was not limited to Faber's representation of Suter, however. The order also directed Celina and Cincinnati to cease their representation of all other Indiana insureds by employee-attorneys based on perceived violations of the Rules of Professional Conduct. This sweeping remedy is available only through exercise of this Court's original jurisdiction over all matters with reference to the unauthorized practice of law. Ind Const. Art. VII, § 4; Ind. Admission and Discipline Rule 24; Ind. Appellate Rule 4(A)(3). Available procedural routes to raise this general issue include reference to the Disciplinary Commission and an original action in this Court pursuant to Admission and Discipline Rule 24, but not a proceeding in a trial court. Moreover, the trial court's order as to Faber's disqualification is moot because Suter's interest in this case has been resolved through settlement. Despite these jurisdictional defects, the issue is within the original jurisdiction of this Court, and is fully developed by the parties and amici curiae. Because the issue is of importance to many members of the Bar and their clients and affects a number of pending cases, we granted transfer under Appellate Rule 4(A)(9) to resolve the issue on its merits.
II. House Counsel's Ability to Represent Policyholders
Three distinct issues are presented by the use of house counsel to defend liability claims against policyholders. First, some courts have seen the issue, as the trial court did here, as whether use of house counsel constitutes the unauthorized practice of law by the employer-insurer. See, e.g., Gardner v. North Carolina State Bar, 316 N.C. 285, 341 S.E.2d 517 (1986). Second, other courts have viewed this problem as turning on whether there is an inherent conflict in the representation such that it is a violation of the Rules of Professional Conduct for the house lawyer to proceed. See, e.g., In re Rules Governing the Conduct of Attorneys, 220 So.2d 6 (Fla.1969). Finally, even if such an arrangement may be consistent with the Admission and Discipline Rules, the Rules of Professional Conduct and any applicable statutes, there remains the question whether the representation was properly entered into in the specific case.
Whether an insurance company may properly employ salaried attorneys to represent insureds in claims litigation has been addressed by ten states through court decisions and by the American Bar Association and ten other jurisdictions in ethics opinions. Eight of the ten state courts and one federal circuit have concluded that it is permissible for an attorney employed by an insurance company to represent the company's insureds, but have reached that result through a variety of paths. Two states have disapproved of the arrangement, one focusing on the potential conflict in interest between the insurer and the insured and the second on a statutory bar against the practice of law by a corporation. American Ins. Ass'n v. Kentucky Bar Ass'n, 917 S.W.2d 568 (Ky.1996); Gardner, 341 S.E.2d at 517.
For the reasons stated below, we now hold, consistent with the majority of state courts that have addressed the issue, that (1) insurance companies do not necessarily engage in the unauthorized practice of law when house counsel represent their insureds in claims litigation and (2) attorneys who are employees of insurance companies do not necessarily trigger an impermissible conflict in violation of the Rules of Professional Conduct when they appear as counsel to defend claims against the companies' policyholders.
A. Disclosure
As a preliminary matter we address the Wills' contention that Faber's representation of Suter was improper because Suter was not given notice that Celina could appoint house counsel to represent her rather than an outside attorney. Suter's policy provided: "If a claim is made or suit is brought against 'insured' . we [Celina] will: . [p]rovide a defense at our expense by counsel of our choice .," clearly disclosing the insurance company's prerogative to choose an attorney for the insured. Only by failing to comment on the issue at all does this language deal with the point raised by the Wills that the "counsel of our choice" may be an employee of the insurer. As a general proposition, adequate disclosure is a matter in the first instance properly addressed through administrative regulation. The insurance commissioner may choose to require more explicit notice to the insured at the time the policy is taken out that "counsel of our choice" could or will include house counsel. And a policyholder aggrieved by nondisclosure of this arrangement at the time of issuance is free to assert whatever claim is thought to arise from that circumstance. But this issue provides no basis for disqualification in this case. Suter did not complain of Celina's assignment of Faber to her case and stated that she was satisfied with Faber's representation. Accordingly, the quality of Suter's notice presents no issue here.
B. Unauthorized Practice of Law
The trial court reasoned that: (1) the attorney-agents of Celina are engaged in the practice of law; (2) Celina, a corporation, can act only through agents; (3) the acts of the attorneys are those of Celina; therefore (4) Celina is engaged in the practice of law. The trial court went on to conclude that Celina's practice of law was unauthorized because Indiana's professional corporation statute implicitly prohibits general business corporations and insurance companies from practicing law. A variant on this theme was adopted by the Kentucky Supreme Court in American Insurance Association v. Kentucky Bar Association, where it reasoned that "a corporation cannot lawfully engage in the practice of law.... Moreover, a corporation ] cannot obtain license to practice law, since it is wholly incapable of acquiring the educational qualifications necessary to obtain such license, nor can it possess in its corporate name the necessary moral character required therefore." 917 S.W.2d 568, 571 (Ky.1996) (citations omitted).
Unlike some other states, Indiana has no express statutory prohibition against a corporation's practicing law. There are, however, many restrictions either explicitly or implicitly imposed by the Rules of Professional Conduct on the forms of business entities available to an attorney for the practice of law. Thus, neither an insurance company nor a general business corporation can simply employ lawyers and hold them out to the public as offering legal services. Whether or not such an activity would involve the entity in the unauthorized practice of law, the Rules of Professional Conduct provide explicit limitations on the persons with whom a lawyer may share fees and form partnerships. Ind. Prof. Cond. R. 5.4(a) & (b). Additionally, the Rules prohibit a lawyer from practicing law in a professional corporation or other association if a nonlawyer owns any interest, is a director or officer or otherwise has the right to direct or control the lawyer's professional judgment. Prof. Cond. R. 5.4(d). Justice Dickson suggests that there would be no recourse against a corporation that simply employed licensed attorneys and sold their services to the general public. 717 N.E.2d 169 (Ind.1999). If this form of business organization violated, for example, the prohibition against sharing the profits of the practice, the attorneys would be subject to discipline up to and including having their licenses suspended or revoked. And if unlicensed persons did the same thing, those people, and presumably their accomplices and the organization employing them, would be subject to the same sanctions as any other person practicing without a license, including criminal prosecution. Indiana Code § 33-1-5-1 criminalizes the practice of law by a "person" who is not an attorney. "Person" includes corporations, partnerships and other legal entities. See id. § 35^11-1-22 (defining "person") & 35-41-1-3 (applying definition to all statutes relating to penal offenses). See also id. § 33-21-2-1 (the practice of law by a person who is not an attorney is prohibited).
Despite the absence of a statute addressing a corporation's practicing law, for decades courts and commentators alike have agreed that it is unlawful for a corporation to practice .law in Indiana. Over sixty years ago we were told that "[t]he general rule that a corporation cannot practice law seems to be well settled in the United States today." David Gleber, Attorney and Client — Unauthorized Practice of Law, 13 Notre Dame Lawyer 289 (1938). Addressing the State Bar Association, one Indiana commentator stated:
Of course, it is unlawful for a corporation to practice law. It is now unlawful, and it has always been unlawful for a corporation to practice law. The very statement of the proposition is its answer. It is just as sensible, it seems to me, to repeal the law of gravitation or to pass a law making it unlawful for objects to fall to the ground.
Glen D. Peters, Bootleggers in Law, 7 Ind. L.J. 46, 53 (1931). This rule was apparently so well settled that those asserting it felt no need to provide any basis for it other than the "common law prohibition of the practice of law by a corporation." Gle-ber, supra at 290. And in more recent times this Court has stated, although in a quite different context, that "[a] corporation is a creature of statute and can neither practice law nor act in person." Department of Pub. Welfare v. Chair Lance Serv., Inc., 523 N.E.2d 1373, 1377 (Ind.1988).
It is not obvious, however, precisely what it means to say a "corporation may not practice law," or why that is true in every potential sense of that phrase. The modern statements of the "rule" that a corporation may not practice law typically reflect no more than the point that only a natural person can be admitted to the bar. This is of course correct. The admission provisions requiring a lawyer to graduate from law school and to sit for the bar exam do not contemplate a legal entity as a bar candidate. As the Supreme Court of Georgia put it, "[i]t is manifest from these [admission] provisions of the law that no corporation can be licensed to practice law in this state. No corporation can comply with the requirements which are imposed upon applicants as prerequisites to enable them to obtain license to practice law." Boykin v. Hopkins, 174 Ga. 511, 162 S.E. 796, 800 (1932). Similarly, it is clear that only licensed attorneys may lawfully "practice law." Indeed, as already noted, the unlicensed practice of law by any person is criminal.
From these general propositions in concert with conventional agency principles the Wills and the trial court concluded that the insurer-employer of a licensed attorney is unlawfully practicing law. However, it is clear that some provisions of our Rules and statutes assume or contemplate that entities that cannot sit for the bar may nonetheless employ lawyers who practice law and in that sense "practice law" themselves. All agree that a group of attorneys may lawfully organize as a partnership, limited liability partnership or professional corporation. Each of these legal entities has individuals who are shareholders, partners or employees of the organization and who, as licensed lawyers, also practice law. Despite the obvious fact that neither the partnership nor the professional corporation graduated from law school, etc., there is no claim raised that any of these entities is engaged in the unauthorized practice of law. Moreover, our Rules of Professional Conduct at least implicitly confirm that a partnership's "activities" may consist of the practice of law by, for example, Rule 5.4(b)'s prohibition against formation of such a partnership with a non-lawyer partner.
The statutory provisions for professional corporations are also relevant. The trial court pointed to Indiana Code § 23-1.5-2-. 3 in support of its conclusion that Celina, an insurance company, engaged in the unauthorized practice of law. This section authorizes professional corporations to be formed to render professional services. Specifically, it provides for a legal entity that is authorized "to render services that may legally be performed only by an attorney." Ind.Code § 23-1.5-2-3(3) (1998). This provision seems to assume that the professional corporation, by- "rendering services" will itself be practicing law, just as Rule 5.4(b) describes a partnership as practicing law. The practice is not unauthorized, however. The professional corporation statute goes on to provide that "[a] professional corporation may render professional services only through individuals permitted to render such services in Indiana." Id. § 23-1.5-2-5. This statute reinforces the conclusion that entities may lawfully "render" legal services if the activities are conducted by a licensed attorney. It also authorizes professional corporations to conduct a general practice of law. We do not agree, however, that it impliedly prohibits employees of a general business corporation or an insurance company from practicing law. Rather, it simply leaves them where it found them, subject to the confinements of other rules but not inherently incapable of practicing law.
Finally, the Rules also explicitly recognize that corporations may have house counsel. The definition of a "law firm" includes "lawyers employed in the legal department of a corporation or other organization." Prof. Cond. R. preamble. Rule 1.13 by its terms applies to attorneys "employed or retained" by a corporation or other organization. As a result, employee-attorneys are subject to the same obligations, including supervision, etc., that apply to attorneys in other forms of practice. There is no dispute that properly admitted employee-attorneys practice law in representing their employer and as such are subject to the Rules of Professional Conduct. Moreover, as elaborated in Part II.C., it is not uncommon for house counsel to represent both the corporation and its officers, directors or other employees in matters where the potential for conflict does not preclude common representation. There, as in the insurer situation found in this case, the attorney's obligations run to both clients. Both situations present the possibility of a conflict between the interests of the two clients. Despite that possibility, in many cases the matter is resolved without any significant divergence of those interests, and the interests of economy and simplicity clearly justify the practice.
Notwithstanding the continuing ban, indeed criminalization of "practicing law" by any "person" not an attorney, the Rules of Professional Conduct, statutes and well accepted forms of practice clearly imply that the entity itself is not unlawfully practicing law as long as the activity is conducted through licensed attorneys. It is of course true that a legal entity can be responsible for the professional actions of its partners, employees and agents under standard doctrines of respondeat superior, and in that sense is viewed as engaged in the activity. But that does not mean the entity unlawfully practices law any more than Federal Express unlawfully pilots airplanes. Rather the practice of law, the piloting of airplanes and many other activities are required to be performed by licensed professionals. And, as a general proposition, where the law requires a license, agency doctrine permits an unlicensed legal entity to employ licensed agents to perform those acts requiring a license. Restatement (second) of Agency § 19 cmt. d (1958). In each case the lawfulness of the entity's activities turns on whether the individual is properly licensed.
Regardless of whether a partnership, a professional corporation, an insurance company, or any other legal entity may be said to be practicing law in some sense, we believe the proper focus of the unauthorized practice inquiry is whether the challenged activity results in the "unauthorized" practice by the individuals involved. Rather than turning on a syllogism based on a series of propositions of dubious general validity, the unauthorized practice issue boils down to whether a non-lawyer is performing tasks requiring a lawyer, or a lawyer not admitted in this State is practicing in Indiana. See 2 GeoffRey C. Hazard, Jr. & W. WilliaM Hodes, The Law of Lawyering: A Handboox on the Model Rules of PROFESSIONAL Conduct § 5.5:102 (1985 & Supp.1998) ("Most of the law on unauthorized practice has been developed by the courts in criminal prosecutions and injunction proceedings against [nonlawyers] for practicing without a license and in civil cases attempting to hold such persons liable for malpractice where they held themselves out as lawyers.").
There is no dispute that the attorney-employee who represents the organization that employs the attorney is practicing law. There is also no dispute that the attorney in this case can properly represent his employer in connection with the Wills' claim. The only issue is whether the concurrent representation of the insured renders the representation unauthorized or makes it somehow the practice of law by someone other than the attorney. Given that the attorney's representation of the insurer-employer is lawful, the representation of a policyholder whose interests are essentially aligned with the insurer's does not inherently result in unauthorized practice by either the insurer or the attorney. Nor, in our view, is this tantamount to offering legal services to the general public. Suter undoubtedly perceived herself as buying insurance coverage and only incidentally acquiring the prospect of legal services. Indeed, if outside counsel were employed to defend her claim, Celina would have been offering her the same package of services from her point of view.
In sum, as explained in Part H.C., there may be many other reasons why an employee-attorney may not concurrently represent both the employer and someone else, but the attorney's status as an employee of an insurance company or any other legal entity is in and of itself no bar. We conclude that Celina does not necessarily engage in the unauthorized practice of law when its employed attorney represents its insureds. Accordingly, Faber does not assist Celina in the unauthorized practice of law when he represents insureds. Our conclusion is the same with respect to Cincinnati and its employed attorneys on the issue of the unauthorized practice of law.
C. The Representation is not Inherently Problematic
There are plainly many situations where representation of both an insured and the insurer is inconsistent with the Rules of Professional Conduct. However, the issue in this case is whether these potential conflicts are so inherent in the representation that it is a violation of the Rules of Professional Conduct to enter into the arrangement in the first place. We think not.
1. The Insurance Company as Co-Client
As a related matter, there is extensive debate in the literature as to whom the attorney represents in this situation. Specifically, whether the attorney is an employee or an outside lawyer, the debate focuses on whether only the insured or both the insured and the insurer should be viewed as the client. We think it unrealistic to ignore the client relationship with both. Joint representation may become problematic, particularly if issues of disclosure of confidences arise. For example the attorney may gain information from the policyholder-client that may affect the insurer-client's coverage obligation. But that is no basis for prohibiting the arrangement in all cases. Whatever issues joint representation raises appear to be wholly independent of the attorney's status as an employee of the insurer or a member of a law firm. Second, there is nothing inherently wrong in common representation of two parties where their interests are aligned. Professional Conduct Rule 1.7 provides direction "[w]hen representation of multiple clients in a single matter is undertaken.... " In this respect, the insured and insurer present no qualitatively different situation from any other pair of commonly represented clients.
If a conflict arises, it will have to be handled, and there are a variety of means to do that. But a vast number of claims have been and presumably will be handled with no significant issue between the insurer and the policyholder. Interests of economy and simplicity dictate that this be permitted to continue. Any abuses can be handled on a case-by-case basis rather than by adoption of the broad prohibition the Wills seek. Although issues may arise in dual representation, none are apparent in this case. In any event, Celina has by contract subordinated its interests as a client to those of Suter. Presumably, this resolves by agreement the priority of counsel's obligations if, for example, counsel learns of information that affects the insurer's and the policyholder's interests differently.
2. Specific Rules of Professional Conduct
The Rules of Professional Conduct prohibit an attorney from representing a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person. Prof. Cond. R. 1.7(b). In addition, the professional independence of a lawyer is not impaired so long as the lawyer does not "permit a person who recommends, employs, or pays the lawyer to render legal services for another to direct or regulate the lawyer's professional judgment." Prof. Cond. R. 5.4(c). "Where someone other than the client pays the lawyer's fee or salary, or recommends employment of the lawyer, that arrangement does not modify the lawyer's obligation to the client." Prof. Cond. R. 5.4 cmt.
The Wills contend that Faber violated each of these as well as Rules 1.8(f) (no compensation from those who interfere with the lawyer's independence); 7.3(f) (lawyer shall not compensate those who recommend employment); 5.4(a) (no sharing of legal fees with nonlawyer); and 5.4(d)(2) and (d)(3) (no practice in an association or a professional corporation if nonlawyer holds interest). Ail of these contentions relate to the inherent inappropriateness of the arrangement. The trial court's order includes detailed discussions of the Wills' claims and the evidence they offered to support those claims. None of the evidence was specific to Faber's relationship to Celina. Rather it focused on the general issue of house counsel as counsel for policyholders. Specifically, as the trial court noted, the Wills "presented nothing beyond mere allegation that Celina directs or regulates Mr. Faber's professional judgment based upon the employment relationship." The trial court found that Faber's employment by Celina did not inherently result in any unethical practice or conflict of interest.
Amicus Curiae, the Defense Trial Counsel of Indiana, argued before this Court that house counsel are less aware of the Rules of Professional Conduct and the discipline matters decided by this Court than attorneys who practice in traditional firms. They point to no evidence in support of this assumption and we decline to adopt it. All members of the Bar accept their obligations to their clients and the Court under the Admission and Discipline Rules and the Rules of Professional Conduct. The vast majority of practicing attorneys discharge them obligations without complaint over an entire career. As to the remainder, this state, like all others, has in place disciplinary procedures to protect the public. In Groninger v. Fletcher Trust, we rejected the plaintiffs claims that "one who is the regular attorney for a trust company will be more loyal to his employer than to the trust for which he is rendering legal services.... " 220 Ind. 202, 208, 41 N.E.2d 140, 142 (1942). Over half a century later we still agree with the trial court's conclusion that "[tjhere is nothing to suggest that attorneys who are house counsel for insurance corporations are ignorant or numb to the expectations of the Rules of Professional Conduct."
In this respect we join the several states that reject the contention that house counsel representation of insureds presents an inherent conflict in violation of the Rules of Professional Conduct. "Compliance with the Code in all cases will be measured against the Code itself, rather than some variation of the 'outside counsel' practice, which, depending upon the circumstances of the particular situation, may not conform to the requirements of the Code." Petition of Youngblood, 895 S.W.2d 322, 328 (Tenn.1995); see also In Re Allstate Ins. Co., 722 S.W.2d 947, 953 (Mo.1987) (en banc) ("There is no basis for a conclusion that employed lawyers have less regard for the Rules of Professional Conduct than private practitioners do.") In rejecting a proposed conduct rule prohibiting house counsel from representing insured, the Supreme Court of Florida found no basis for distinguishing between house counsel and outside counsel. It observed that all attorneys engaged to represent insureds pursuant to an insurance contract face the same ethical decision: an attorney, whether house counsel or outside counsel, "is employed to represent two clients." In Re Rules Governing Conduct of Attorneys, 220 So.2d at 7. The court concluded that the lawyer owes "undivided loyalty to the client whom he purports to serve, not to the third party source of his compensation." Id. at 8. The Supreme Court of Georgia observed that "both [attorneys employed and compensated on a case by case basis] and staff counsel owe duties to and therefore represent both the insurer and the insured." Coscia v. Cunningham, 250 Ga. 521, 299 S.E.2d 880, 881 (1983).
It is of course true that conflicts may arise in the course of representation of an insured by house counsel. The same is true if the insurer pays for a law firm to represent its insured. In either case there may be a conflict based on coverage disputes, the risk of a claim in excess of policy limits, the acquisition of information from the insured that bears on coverage, or a variety of other items. If such a situation arises retention of new counsel to represent the policyholder may be ei ther preferred or necessary. But this potential does not require the abandonment of a mode of doing business that the insurer finds efficient and cost effective, and the insured knowingly accepts. Presumably ultimately the marketplaces of ideas and premium charges will sort this out and strike a balance between claimed cost advantages and perceived desirability of wholly independent counsel. We find nothing in our Rules of Professional Conduct to prevent the parties from continuing to duke this issue out in those marketplaces without interference from the judiciary. If and when abuses are perceived by policyholders they may seek the aid of the courts or the insurance commissioner. Our point is not, as Justice Dickson concludes, that two wrongs make a right. 717 N.E.2d at 183. Rather it is that the potential for conflict is inherent in the insurer-insured relationship regardless of whether the attorney is' house counsel or outside counsel, and the employment relationship is not qualitatively different in this respect.
Finally, as already noted, apart from the unauthorized practice issue, most of the problems identified by the Wills exist whether house counsel or outside counsel are used. If there is any difference between house and outside lawyers in this respect it is quantitative and not qualitative and varies from situation to situation. Employee-attorneys may be subject to pressures from their employer. But it is also unrealistic to suggest that an outside lawyer is immune from the blandishments of a client, particularly a high volume client that may be the source of a significant portion of the firm's revenues. For a decade the legal press has been full of stories of various cost containment programs implemented by insurers and others to reduce their outside legal expenses. Ultimately all attorneys are bound by their professional obligations to place the interests of their policyholder-client ahead of their own if pressure from an employer or a co-client insurer conflicts with those of the policyholder. We will not assume that an attorney employed by an insurance corporation is in violation of any of the Rules based solely on that employment relationship. The full range of disciplinary sanctions and civil remedies are available to deal with hopefully isolated instances of trouble. This is true whether the attorney is an employee of an insurance company, a partner in a firm significantly dependent on the insurer's business or a lawyer relatively free of direct economic pressure.
In sum, we hold that an insurance company does not engage in the unauthorized practice of law when it employs attorneys to represent insureds and that attorneys employed by insurance companies may represent insureds under circumstances and to the extent permitted by their ethical obligations defined in the Admission and Discipline Rules and the Rules of Professional Conduct. This holding does not, as Justice Dickson suggests, turn on the fact that the employer is an insurance company; it depends on the commonality of interests of the jointly represented clients. 717 N.E.2d at 166.
D. Protection of the Public
The Court's ability to prohibit the unauthorized practice of law and regulate the conduct of licensed attorneys "emanates from the need to protect the public from those not properly licensed or otherwise qualified to act as attorneys." State ex rel. Disciplinary Commission of the Supreme Court of Indiana v. Owen, 486 N.E.2d 1012, 1014 (Ind.1986); see also Hulbert v. Mybeck, 220 Ind. 530, 532, 44 N.E.2d 830, 831 (1942). In addition, the preamble to the Rules of Professional Conduct cautions that "[t]he profession has a responsibility to assure that its regulations are conceived in the public interest and not in furtherance of parochial or self-interested concerns of the bar."
As demonstrated by this case, free access to the market of legal services and the protection of the public is a delicate balance with results that are not always predictable. As noted in Part H.C.2., in the realm of insurance defense, the public may ultimately reap the benefits of better service at lower cost through the use of house counsel. Although we find no inherent detriment to the general public in the defense of insurance claims by house counsel, we reiterate the fact that the Rules of Professional Conduct, the disciplinary procedures, and other civil remedies exist for the protection of all clients, whether the attorney is house counsel, a sole practitioner, affiliated with a traditional law partnership, or anything else.
III. The Use of "Berlon & Timmel"
The trial court found that the use of the name Berlon & Timmel by Cincinnati's attorneys was deceptive in violation of Professional Conduct Rule 7.2 because "that name implied independence." That Rule provides: "[a] lawyer shall not practice under a name that is misleading as to the identity, responsibility, or status of those practicing thereunder, or is otherwise false, fraudulent, misleading, deceptive. ."
The attorneys who work at Berlon & Timmel are employed by Cincinnati and handle only matters for Cincinnati or its policyholders. No one contends that the attorneys perform legal services for the general public. All Berlon & Timmel clients are informed that the attorneys are employed by Cincinnati at the beginning of the representation. Berlon & Timmel's letterhead includes the following language printed along the bottom of the page: "Berlon & Timmel is an unincorporated association, not a partnership, of individual licensed attorneys employed by The Cincinnati Insurance Company for the exclusive purpose of representing the Cincinnati Insurance Companies and their policyholders."
We agree with the trial court that the use of the name Berlon & Timmel implies independence and that the ordinary person would assume "Berlon & Timmel" to be some form of outside counsel. As a result it is "misleading as to the identity, responsibility, or status" of the attorneys practicing under the name.
Cincinnati contends that the disclosure language at the bottom of the letterhead is sufficient to dispel any misperception. The trial court noted that not all forms of communication include this disclosure. For example, Berlon & Timmel's phone book listing and door sign use only "Berlon & Timmel." The trial court concluded that the size and location of the disclosure was "not adequate to negate the deceptiveness resulting from the independence indicated by the firm name, the description on the office door, and the phone book listing." The court also found that the disclaimer was "susceptible to the interpretation that [Cincinnati] was not Berlon & Timmel's only employer" because it stated that "Berlon & Timmel is . employed by The Cincinnati Insurance Company for the exclusive purpose . " not that "Berlon & Timmel is . exclusively employed by The Cincinnati Insurance Company...."
Although similar disclosure language may be sufficient to permit sole practitioners who share office space to adopt a name that may appear as a law firm, it is not sufficient in this case. The use of a firm-like name by a "captive firm" differs from sole practitioners sharing expenses in two respects. First, it may be read to imply not only a separate legal entity but also an independent status that is not enjoyed by the insurer's employees. There is greater danger for the public to be misled in permitting an insurance company to pass off its legal department as an independent entity. Second, there is at least some practical sense in permitting groups of financially independent lawyers to benefit from the economies of a shared name such as the convenience of one sign on shared offices or the cost savings of one advertise ment. Cincinnati provides no rationale for using "Berlon & Timmel" as a designation for its house counsel. Perhaps the name was adopted without much reflection. In any event, it is difficult to come up with a proper reason for this designation and we conclude that it is improper to create the perception of a law firm at least partially independent of Cincinnati.
For these reasons we agree with the Supreme Court of Tennessee that the use of captive law firm names is not permissible under the Rules of Professional Conduct. That court reasoned that "[t]he representation that the attorney-employee is separate and independent from the employer is, at least, false, misleading and deceptive. It may be fraudulent, depending on the circumstances under which the representation is made." Petition of Youngblood, 895 S.W.2d 322, 331 (Tenn.1995); see also Supreme Court of Ohio, Board of Comm'rs on Grievances and Discipline, Op. 95-14 (1995) (attorneys employed by an insurance company may not represent themselves to be outside counsel when they are house counsel). From the record before us, it appears that Berlon & Timmel identifies itself as an aggregate of employee-attorneys at the first contact with the policyholder. If so, the fraud conclusion may well be inappropriate here.
Although we agree that the use of a law-firm-like name is improper, the trial court's finding that Cincinnati should close its Indianapolis office was too broad. It is sufficient that the Indiana attorneys practicing under the name Berlon & Timmel take immediate action to discontinue use of Berlon & Timmel or any other name suggesting a legal entity other than Cincinnati to describe their practice as employees of Cincinnati.
Conclusion
We hold that attorneys employed by insurance companies may represent insureds under circumstances and to the extent permitted by their ethical obligations and that their employment does not necessarily constitute the unauthorized practice of law by the insurance company. We also hold that the use of a name such as "Ber-lon & Timmel" by attorneys employed by an insurance company violates Professional Conduct Rule 7.2. The order of the trial court is vacated.
SHEPARD, C.J., and SULLIVAN and SELBY, JJ., concur.
DICKSON, J., dissents with opinion.
. Robert Suter, Betty's husband was also named as a defendant. Mr. Suter is deceased. All references in this opinion are to Betty Suter.
. There is no case or controversy requirement limiting the jurisdiction of this Court as Article III of the U.S. Constitution restricts the jurisdiction of federal courts. Nevertheless, in many circumstances this Court has refrained from addressing issues that may be mooted by procedural or other threshold issues, even if there is no constitutional requirement to do so. See, e.g., Price v. State, 622 N.E.2d 954, 958 (Ind.1993). However, this case does not involve invalidating an action of another branch of government or otherwise challenging the action of a co-equal branch. Rather it addresses issues that are indisputably within the power of the judiciary and specifically within the power of this Court.
. ABA Comm, on Ethics' and Prof'l Responsibility, Formal Op. 282 (1950).
. Alabama Ethics Op. RO-81-533; Arizona Ethics Op. 75-4 (1975); California Standing Comm, on Prof 1 Responsibility and Conduct, Formal Op. No.1987-91; Colorado Bar Ass'n, Formal Ethics Op. 91 (1993); Illinois State Bar Ass'n, Advisory Opinion on Prof'l Conduct, Op. No. 89-17 (1990); Michigan Ethics Op. CI-1146 (1986); New Jersey Supreme Court Comm, on Unauthorized Practice, Op. No. 23, (1984); New York State Bar Ass'n, Prof'l Ethics Comm. Op. 109 (1969); Texas Ethics Op. 167 (1958); Virginia State Bar, Legal Ethics Op. No. 598 (1985).
. Several decisions hold that the employment relationship between the insurance company and the attorney is not a per se violation of the Rules of Professional Conduct. See In re Rides Governing the Conduct of Attorneys, 220 So.2d at 6 (rejecting proposed Rule of Conduct prohibiting the practice); Petition of Youngblood, 895 S.W.2d 322 (Tenn.1995). Some find the practice permissible because of the alignment between the insured's interests and the insurance company's interests. Kittay v. Allstate, 78 Ill.App.3d 335, 33 Ill.Dec. 867, 397 N.E.2d 200, 202 (1979) (corporation may employ attorneys "in and about its own immediate affairs"); Strother v. Ohio Casualty Insurance Company, 14 Ohio Opinions 139 (1939) aff'd without opinion by Court of Appeals. Others rely on a combination of the above reasoning. See King v. Guiliani, 1993 WL 284462 (Conn.Super.1993); Coscia v. Cunningham, 250 Ga. 521, 299 S.E.2d 880 (1983); In Re Allstate Ins. Co., 722 S.W.2d 947 (Mo.1987) (en banc). See also Joplin v. Denver-Chicago Trucking Co., 329 F.2d 396 (8th Cir.1964); United Services Auto. Ass'n v. Zeller, 135 S.W.2d 161 (Tx.Civ.App.1939); Utilities Ins. v. Montgomery, 134 Tex. 640, 138 S.W.2d 1062 (Tx.Com.App.1940).
. The Supreme Court of North Carolina held that a corporation engaged in the unauthorized practice of law because it appeared, through its employees, as an attorney for the insured. This appearance by the insurance corporation violated a North Carolina statute that specifically prohibited corporations from practicing law. "It shall be unlawful for any corporation to practice law or appear as an attorney for any person...." N.C. Gen.Stat. § 84-5 (1995). The court also relied on North Carolina case law that explicitly held where a corporation's employees perform acts, they are the acts of the corporation. State v. Pledger, 257 N.C. 634, 127 S.E.2d 337, 340 (1962). Indiana has no similar statute or common law doctrine, except to the extent the common law reflects standard respondeat superior doctrine.
In some states with a statutory prohibition against a corporation's practicing law an exception provides for representation of the corporation itself. See 705 Ill. Comp. Stat. 220/1 & 5 (West 1997) (formerly codified at Ill.Rev. Stat ch. 32, par. 411 & 415 (1977)); see also Kittay v. Allstate Ins. Co., 78 Ill.App.3d 335, 33 Ill.Dec. 867, 397 N.E.2d 200, 202 (1979).
. There may also be restrictions on the entity's power under the statutes or articles of incorporation under which it is organized, but none are claimed to be applicable here.
. In 1981 the ABA Commission on Evaluation of Professional Standards proposed amending Rule 5.4(d) to permit "all forms of law practice, and all financial arrangements for providing legal services, so long as all participating lawyers met their professional responsibilities under the other Model Rules." 2 Geoffrey C. Hazard, Jr. & W. William Hodes, The Law of Lawyering- A Handbook on the Model Rules of Professional Conduct § 5.4:101 (1985 & Supp.1991). The ABA House of Delegates rejected the proposed rule in favor of the version currently found in Indiana's Rules of Professional Conduct.
. The perception among lawyers that banks and trust companies were encroaching on the domain of lawyers by executing wills and trusts was the principal focus of this issue in the 1930s. See David Gleber, Attorney and Client — Unauthorized Practice of Law, 13 No-tre Dame Lawyer, 289, 289 n. 1 (1938) (collecting slate supreme court cases decided between 1932 and 1937). "[T]he bootlegger in law, that person or institution who is fitted neither by training, experience or character, to practice law, but notwithstanding such lack, not only attempts to practice law, but actually solicits such business. I mean the bank, the so-called trust company ." Glen D. Peters, Bootleggers in Law, 7 Ind. L.J. 46, 47 (1931). See also Edward C. Massa, Hazards of the Legal Profession, 7 Notre Dame Lawyer 82, 82 & 85 (1931) ("The field which originally belonged solely to the attorney has been narrowed down, especially of late years, . makfing] it increasingly difficult for lawyers to earn reasonable living." Banks, trust companies, and insurance companies were among the "innumerable instances" of the "encroachment by various unauthorized persons and agencies upon the field of the law").
. Prior to the 1961 American Bar Association opinion approving the professional corporation form, "[t]he traditional stance of the organized bar was that to incorporate a law practice was to treat law practice as a business rather than a profession, and thus is was prohibited." Charles W. Wolfram, Modern Legal Ethics § 16.2.4 (1986). The formation of partnerships did not "treat law practice as a business" apparently because law firms were viewed as collections of sole practitioners. Id. § 16.2.1. As early as the first quarter of the nineteenth century lawyers began practicing in partnerships although most lawyers practiced as individuals. James Willard Hurst, The Growth of American Law 306 (1950). By 1928 partnerships were well accepted by the organized bar and the American Bar Association adopted Cannon 33 which stated " [partnerships among lawyers for the practice of their profession are very common and are not to be condemned." Henry S. Drinker, Legal Ethics 203-04 (1953).
. The Admission and Discipline Rules anticipate that only natural persons will be admitted to the Bar to practice law. Rule 13 requires applicants to graduate from an ABA approved law school and complete two cumulative semester hours of legal ethics or professional responsibility; Rule 17 requires applicants to pass a Bar examination and the Multistate Professional Responsibility Examination; and Rule 12 requires that the Board of Law Examiners certify to the Supreme Court that the applicant has been found to possess the necessary good moral character and fitness.
. In Matter of Contempt of Mittower, this Court held a disbarred attorney in contempt for acting as "general counsel" for an estate planning business. 693 N.E.2d 555, 558 (Ind.1998) ("The practice of law includes . legal formalities, negotiations, or proceedings" on behalf of others.); see also Wolfram, supra, § 13.7.3 (house counsel are fully subject to the disciplinary powers of the state in which they practice).
. A typical such situation is a claim against both the organization and the employee where there is no dispute that the organization is obligated and financially able to indemnify the employee. The interests of the two, like those of insurer and insured, are aligned and the cost and complication of multiple attorneys is unnecessary.
.Indiana has no provision for registration of house lawyers under restricted licenses. Cf. e.g., Ohio Gov. Bar R. VI § 4 (permitting an attorney admitted to the practice of law in another state to register under "corporate status" and perform legal services in Ohio solely for a nongovernmental employer as long as the attorney is a full-time employee of that employer).
. As Admission and Discipline Rule 1 states, the Bar of this state consists of 'attorneys" who are duly admitted, not the entities of which they are owners or employees, or with which they have some other relationship.
. See, e.g., Stephen L. Pepper, Applying the Fundamentals of Lawyers' Ethics to Insurance Defense Practice, 4 Conn. Ins. L.J. 27 (1997); Charles Silver, Does Insurance Defense Counsel Represent the Company or the Insured?, 72 Tex. L.Rev. 1583 (1994); see also Nancy J. Moore, The Ethical Duties of Insurance Defense Lawyers: Are Special Solutions Required?, 4 Conn. Ins. L.J. 259, 261 n. 7 (1997) (collecting additional articles).
. The trial court found no violation of Rules 1.7(b) and 7.3(f). It stated that it was "un willing to find a per se violation" based on Faber's employment status for Rules 1.8(0 and 5.4(c). It further stated that the Wills' claim that Faber violated Rule 5.4(a) was "without merit" and it did not address Rule 5.4(d)(2) or (d)(3).
. See California Standing Comm, on Prof'l Responsibility and Conduct, Op. 1986-90 (each lawyer must discloses affirmatively that he or she is, in fact, a sole practitioner).