Notice Agreement Legal Between Inmate, Bail Bondsman?

While it would be unusual, a bail bondsman may become a defendant in a criminal case, as the following summary of a recent California Supreme Court case, People v. Martinez, exemplifies.

To understand the bail bond industry, it is helpful to know a bit of the history behind the Bail Bond Regulatory Act.  Shortly after bail bonds were first established as a way for a person to provide collateral in exchange for one’s release from jail, insider arrangements quickly arose as a way for certain bail bond companies to gain monopolistic control in the regions where they operated. 

Before the Act’s passage, public attention focused, in particular, on abuses by one of the first for-profit bail bond businesses in the United States, the McDonough Brothers Bail Bond Brokers.  See Barnes, “Fountainhead of Corruption”: Peter P. McDonough, Boss of San Francisco’s Underworld (1979) 58 Cal. History 142, 151-152.  The public learned that McDonough Brothers had “monopolized the bail bond business in San Francisco” by developing a system of acquiring insider information about the bail needs of recent arrestees. Barnes, at 145.

“Besides stationing functionaries of the firm at local, state and federal courts, the McDonough organization created a remarkable network of informants” – including police officers who “provided daily lists of who had been arrested, the charges and the bail set” and even set up radios and connected the prisons and jails to McDonough offices.  Barnes, at 146. 

The firm reportedly used the information it acquired to quickly solicit business from recent arrestees and secure release orders from the city’s superior court judges. 

According to news reports of the era, other bail bond firms used similar tactics throughout the country, recruiting police officers to notify them of recent arrests for a share of the bail premium and using this information to charge exorbitant bond fees from friends or relatives of the arrestee.

These abusive practices led to the passage of the Bail Bond Regulatory Act and regulations like California Code of Regulations, title 10, § 2076.

Section 2076 prohibits bail bond agents from entering into agreement with jail inmates to be notified when individuals have recently been arrested and thus may need bail bond services.

Ms. Martinez demurred to the complaint, arguing that § 2076 violated her freedom of speech under the First Amendment of the United States Constitution and article 2, section 2(a) of the California Constitution.  The trial court overruled the demurrer.

Ms. Martinez then appealed to the Sixth Appellate District, which held the regulation was facially invalid under the First Amendment.  The court held that the regulation imposed burdens on the speech rights of bail bond agents that were not adequately justified by the state’s interests in deterring abusive bail solicitation practices.

The People then appealed this ruling to the California Supreme Court, which reversed the Sixth District, finding the Court of Appeal failed to consider the full range of interests at stake when a commercial bail bond agent engage the services of a jail inmate to gain private access to information (“insider information”) about prospective clients. 

The Supreme Court explained that that state’s interest in stemming this practice is not solely, or even primarily, about the manner in which bail bond agents solicit clients.  More broadly, the violation at issue undermines fair competition in the bail bond industry and sound jail administration (such as eroding jail security by promoting inmates conducting business while in jail on pressuring inmates to sign contracts with certain bail agents to avoid retaliation from other inmates). 

The ruling by the Supreme Court also explains the various levels and differing standards of constitutional review (“strict scrutiny” and “intermediate scrutiny”) under the First Amendment for a private individual’s right to free speech as compared to a commercial entity’s freedom of speech (which has been interpreted to include the exchange of information), however, ultimately, the state’s compelling interest in regulation of the bail bond agent activity was found valid under both standards.