Smart Got: Disbarment for Felony Conviction for Forceful Assault Now Precedent

The Review Department of the State Bar Court has ordered publication of its April 10, 2020, opinion In the Matter of Smart, case no. 17-C-03687.  It upheld the hearing judge’s recommendation of disbarment.  Smart plead guilty to felony charges of violating Penal Code section 245(a)(4) (assault with force likely to produce great bodily injury), and Penal Code section 246.3(a) (discharging firearm with gross negligence. The hearing judge found the circumstances surrounding the crimes involved moral turpitude and that Smart had failed to demonstrate the compelling mitigation necessary to avoid disbarment under Standard 2.15(b).

Publication of Smart now makes it a citeable precedent in State Bar Court (Rule of Procedure 5.159).  The State Bar’s discipline office (the Office of Chief Trial Counsel  (OCTC)) asked for publication and now that they have got Smart, they will make liberal use of it in arguing for high levels of discipline in any case remotely close to its facts.  How effective it is as precedent is debatable; on levels of discipline, as opposed to procedural and other issues, the key yardstick is a “balanced consideration of all relevant factors…including factors particular to the offense and the offender” Howard v. State Bar (1990) 51 Cal.3d 215, 221–22; In the Matter of Van Sickle (Review Dept. 2006) 4 Cal. State Bar Ct. Rptr. 980, 993.  The facts of Smart are extreme; so is the result.  It has too often been said that when the tool you have is a hammer, every problem looks like a nail.  The is a relative lack of citeable case law on the appropriate discipline for crimes involving assaultive behavior that Smart helps to fill but it doesn’t help establish what the discipline should be for a case less far along the crazy continuum, so it isn’t very helpful.  Nonetheless, it will be cited often, much like In the Matter of Guillory has become a standard reference in OCTC argument on DUI cases.  Guillory is a disbarment case involving serial misdemeanor drunk driving over a period of years by a former Deputy District Attorney who attempted to use his status to evade arrest and prosecution.  Extreme facts, extreme result.

Attorney discipline resulting from criminal convictions has gotten more attention lately because of the State Bar’s fingerprinting snafu that caused all California lawyers to have to submit fingerprints again.  This has resulted in a lot more criminal conviction proceedings in State Bar Court.  Many of those are DUI cases that were never reported as required by the criminal prosecutor (Bus. & Code section 6101(b).) Some of them are many years old.  Precedents like Smart and Gulllory can fuel a tendency to case every criminal conviction in the worse possible light. So far, in my view, the State Bar Court has continued to honor the Supreme Court’s standard, that appropriate discipline is a balanced consideration of all relevant factors, including those particular to the offense and the offender.  After all, it is precedent.

Hush Agreements on State Bar Complaints

 

 

Recently amended AB 3362 is notable for the fact that it reduces State Bar licensing fees (“dues” no longer) by a munificent $34.00.  But a recent amendment also shines a light on a statutory provision often overlooked, often to a lawyer’s sorrow: Business and Professions Code section 6090.5, which addresses what might be called a State Bar “hush” or non-disclosure agreement.  Here is redlined text, showing the current statute and what the amendment would change:

 (a) It is cause for suspension, disbarment, or other discipline for any licensee, whether as a party or as an attorney for a party, to agree  acting on their own behalf or on behalf of someone else, whether or not in the context of litigation to solicit, agree,  or seek agreement, that:
(1) The professional misconduct  Misconduct  or the terms of a settlement of a claim for professional  misconduct shall not be reported to the State Bar.
(2) The plaintiff A complainant  shall withdraw a disciplinary complaint or shall not cooperate with the investigation or prosecution conducted by the State Bar.
(3) The record of any civil action for professional misconduct  action or proceeding  shall be sealed from review by the State Bar.
(b) This section applies to all settlements, whether made before or after the commencement  agreements or attempts to seek agreements, irrespective of the commencement or settlement  of a civil action.
The statute, first passed in the great wave of disciplinary reform of the mid-1980s ((Sen. Bill No. 1569 (1985–1986 Reg. Sess.))means to facilitate the public policy of that the State Bar’s discipline prosecutor should be made aware of potential attorney misconduct. The statute is broad, forbidding even seeking such an agreement as well as making one.  The amendments are mostly intended to clarify the statute, including clarifying that someone acting on the client’s behalf can violate the rule.  The one substantive change is changing replacing “plaintiff” with “complainant” correcting language that has been puzzling for over thirty years.  This hasn’t prevented the statute from resulting in discipline even where the complainant was not a “plaintiff” in any pending actions (see In the Matter of Brockway (Review Dept. 2006) 4 Cal. State Bar Ct. Rptr. 944, 2006 WL 1360438.
In an unpublished Review Department decision (In the Matter of Karnazes, State Bar Court case no.10–O–00334, filed 1/2/14. 2014 WL 232500), the following “non-disparagement clause” agreed to in a civil settlement filed after a State Bar complaint had been filed, was found to violate 6090.5:
‘The Parties agree that in the event of any inquiry regarding this former dispute with the other party, they shall state that all of Zachary’s claims have been resolved and that he is not at liberty to discuss the terms of that resolution. Zachary further agrees not to disparage [Karnazes], her business, or any of her officers or employees.”’

Karnazes involved a different but not unique set of facts involving “serious overreaching of the attorney-client relationship under the guise of parental concern. Respondent Elizabeth M. Barnson Karnazes used the legal system to further her desire to control her adult son, who was also her client. In doing so, she lost sight of her ethical obligations and committed serious misconduct, including misappropriating over $57,000 of his settlement funds through conversion, commingling over $100,000 of her personal funds with his, and filing a lawsuit directly adverse to him. After her son filed a complaint with the State Bar’s Office of the Chief Trial Counsel (State Bar), Karnazes compounded her misconduct by conditioning the release of his funds on his agreement not to cooperate with the State Bar’s investigation. In the end, Karnazes withheld her son’s settlement funds for more than three years and released them only four days before her disciplinary trial.”

Karnazes, slip opinion at page 1. The attorney was disbarred in California and subsequently disbarred in New York on reciprocal discipline.
COPRAC formal ethics opinion 2012-185 addresses violations of section 6090.5 and interpreted the statute broadly, concluding:
Business and Professions Code section 6090.5 bars an attorney’s attempt, in settling a dispute with his or her client, to seek or obtain a client’s oral or written agreement not to make a State Bar complaint. Section 6090.5 may also prohibit a lawyer from seeking representations of the client’s intentions or actions regarding filing a complaint with the State Bar. Even a simple contractual factual recitation that the client has not yet made a State Bar complaint in the past may be an ethical violation since it could produce a chilling effect on the client’s future actions. Once a lawyer seeks such an oral or written agreement, the withdrawal of that request will not cure the ethical violation.
The ethics opinion suggests that the actual language in the proposed hush agreement is less important than whether a “chilling effect” is intended.  For this reasons, creative “work arounds” to evade section 6090.5 are not wise.
Is it an ethics rules or a regulatory rule?  That is an interesting question but ultimately about as relevant as the question of whether Certs is a breath mint or a candy mint, because you can be disciplined for violating it, and the statute itself prescribes substantial discipline: suspension or disbarment.  Moreover, it is buried in a Business & Professions Code, a place many lawyers, otherwise familiar with the Rules of Professional Conduct, overlook, a trap for the unwary.

Unicorn Sighting: Discipline for Conflict of Interest

It is has been an item of conventional wisdom that conflicts of interests, while presenting many interesting ethical issues, are mostly dealt with through civil remedies, such as disqualification and actions for breach of duty, not discipline.  This is evidenced by a relative paucity of discipline case law dealing with conflict of interest, at least with types of conflict of interest addressed by Rule of Professional Conduct 1.7 and its forbearer, former Rule 3-310. A recent unpublished case from the Review Department runs against the conventional wisdom;  unicorns, it seems, do exist.

In the Matter of Foster, filed 3/16/20, is not a precedential decision, being public but not “published” under State Bar Rule of Procedure 1.159  but follows in the wake of a published Court of Appeal decision Knutson v. Foster (2018) 25 Cal.App.5th 1075.  The Review Department succinctly summarized the underlying facts.

Respondent Richard James Foster is charged with multiple counts of professional misconduct involving conflicts of interest arising from his representation of a professional swimmer and his failure to provide her with written disclosure of his relationships in the professional swimming world. Foster’s client was in a contract dispute with USA Swimming, an organization within which Foster maintained close professional relationships. He also previously represented the USA Swimming coach who tendered the contract offer to his client.

The Court of Appeal reversed the trial court’s granting of Foster’s motion for a new trial, finding ample evidence that Foster’s conflicts of interest in led to young swimmer Knutson’s damages, including emotional distress damages suffered when she learned that he lawyer had betrayed her in negotiating a settlement with a party that Foster’s had formerly represented, including revealing her confidential information and taking actions to actively assist the other party to the settlement.  A rather long list of the bad stuff can be found in the slip opinion at pages 18-19.  The Court of Appeal found Knutson entered into the settlement based on her lawyer’s concealment of these materials facts.  It did not find that Knutson had to prove that she would have achieved a “better result” but for Foster’s actions.  The Court of Appeals referred the matter to the State Bar as provided in Business and Professions Code section 6086.1.

The State Bar Court hearing judge found Foster culpable of five counts of misconduct : (1) former rule 3-310(B)(1) for failing to disclose a relationship with a party or witness; (2) former rule 3-310(B)(3) for failing to disclose a relationship with an interested person or entity); (3) former Rule 3-310(E) for representation adverse to a former client) and (4) and (5) two counts of revealing client confidences in violation of Business and Professions Code section 6068(e), subdivision (e).  The hearing judge did not find culpability on a moral turpitude charge (Bus.& Prof. Code section 6106) for concealing documents. She recommended 60 days actual suspension.

Both Foster and the Office of Chief Trial Counsel (OCTC) appealed.  OCTC sought the moral turpitude violation and one year of actual suspension.  Foster sought an admonition, a non-disciplinary disposition that itself has just about unicorn status.  The Review Department noted that “few published California disciplinary opinions deal with disclosure, client conflicts, and client confidences under rule 3-310.” It supported the hearing judge’s analytic approach of looking to the rather more established disciplinary case law dealing the business transaction rule -former Rule 3-300, current Rule 1.8.1 – in support of the discipline recommendation.

Given the paucity of discipline case law dealing with conflicts of interests in the discipline context, should In the Matter of Foster been a published decision.  Rule of Procedure 1.159(d) sets forth publication criteria:

Criteria for Publication. By majority vote, the Review Department may designate for publication an opinion which:
(1) Establishes a new rule, applies an existing rule to a set of facts significantly different from those stated in published opinions, or modifies, or criticizes with reasons given, an existing rule;
(2) Resolves or creates an apparent conflict in the law;
(3) Involves a legal issue of continuing interest to the public generally and/or to attorneys of the State Bar, or one which is likely to recur;
(4) Makes a significant contribution to legal literature by collecting and analyzing the existing case law on a particular point or by reviewing and interpreting a statute or rule; or
(5) Makes a significant contribution to the body of disciplinary case law by discussing the appropriate degree of discipline based on a set of facts and circumstances materially different from those stated in published opinions.

It seems to me that Rule 1.159(d)(4) and (d)(5) should apply.  It wouldn’t be a surprise if OCTC moves to publish this case.  It is possible that a petition to the California Supreme Court will be made.  Unfortunately, the Court’s own criteria for accepting review under California Rule of Court 9.16 are rather limited.  It is stretch to say that the review is necessary to resolve important questions of law and the facts would make it unlikely that this recommendation would be deemed unsupported by the weight of  the evidence.

So it seems likely that this unicorn will remain a rarity.

 

Reversal Reversed: Bradshaw Case Heads Back to State Bar Court

 

The Drexel Bradshaw case was examined in an earlier post on this blog, Reversal of Fortune. Now, fickle Fortune reverses itself again, the California Supreme Court granting a petition from the Office of Chief Trial Counsel by remanding the case back to the Review Department for reconsideration of its July 2019 decision that dismissed the case after a disbarment recommendation from the Hearing Department.  A unanimous Supreme Court asked the Review Department to reconsider the dismissal ‘in light of the June 14, 2019, Amended Statement of Decision on Petition After Trial And Order in San Francisco Superior Court Case No. PTR-17-301118.” It also directed the Review Department to consider whether to return Bradshaw to inactive enrollment under Business and Professions Code section 6007, subdivision (c)(4), pending its reconsideration of the underlying disciplinary matter.  That section provides for automatic inactive enrollment whenever a disbarment recommendation is made in the State Bar Court.

While the State Bar functions as the California Supreme Court’s administrative arm in the area of discipline, the high court seldom grants petitions for review by either respondents or the Office of Chief Trial Counsel, although it reviews all the disciplinary recommendations made by the State Bar Court.

Can the Discipline System Address Extreme Incivility?

 

For every wrong, there is a remedy

Civil Code section 3523 Maxims of Jurisprudence

This is a little more than the average “lawyer does bad thing” story that is a staple of the legal press.  A Culver City lawyer who abused opposing counsel with a number of highly offensive email messages, the content of some you can read about here.  A Federal District Court Judge was so incensed (and rightfully so) by this bizarre and over top parade of offensiveness that he has vowed to remove this lawyer from the profession.

Can he do that?

The local rules of the Central District of California provide that “An attorney in practice before this court will… a. Be courteous and civil in all communications, oral and written, and in all proceedings conduct herself/himself with dignity and respect.” (Local Rule 83.4 av1)(a).)  Telling opposing counsel to “eat a bowl of dicks” certainly violates the rule.

But how is it to be enforced?  The preamble to the Code of Conduct in Rule 83.4 is equivocal in its approach

Compliance with high standards of professionalism depends primarily upon understanding the value of clients, the legal system, the public, and lawyers of adhering to the voluntary standards. Secondarily, compliance depends upon reinforcement by peer pressure and public opinion, and finally, when necessary, by enforcement by the courts through their powers and rules already in existence. This code of conduct is not intended to be a set of rules that lawyers can use to incite ancillary litigation on the question of whether the standards have been observed by an adversary, but the court may take any appropriate measures to address violations of the rules.

Emphasis added. Casting even more uncertainty on the process is Local Rule 83.4(b)

Standards of Professional Conduct. Every member of the bar of this court and any attorney permitted to practice in this court must be familiar with and comply with the standards of professional conduct required of members of the State Bar of California, which are now adopted as standards of professional conduct of this court. No attorney permitted to practice before this court will engage in any conduct which degrades or impugns the integrity of the court or in any manner interferes with the administration of justice within the Court.

Before 1996, the answer might have been more clear.  Former California Business and Professions Code section 6068(f) provided that “it is the duty of an attorney to… avoid all offensive personality.”  Mr. Culver City has almost certainly established a new upper bound to the concept of offensive personality.  Prior to 1997, the State Bar of California regularly prosecuted lawyers for violating the offensive personality statue, albeit with mixed results.  But in 1995, the Ninth Circuit rules that the offensive personality stature was unconstitutionally vague in United States v. Wunsch 84 F.3d 1110 (9th Cir. 1995).  Section 6068(f) was amended to omit the prohibition on offensive personality.

Since then, many civility codes have been promulgated in well-intentioned attempts to address the perceived increase in incivility in the legal profession.  But enforcement has largely been a matter of voluntary adherence or peer pressure, consistent with the preamble of Rule 83.4(a).

The nasty sexist note at issue in Wunsch pales compared to the insane over-the-top rantings in Mr. Culver City’s case. Some attempt will be made by someone to sanction this conduct, to deter others from committing similar conduct.  The State Bar has other tools it can bring to bear, including the prohibition of conduct involving moral turpitude contained in Business & Professions Code section 6106In the Matter of Elkins (Review Dept. 2009) 5 Cal. State Bar Ct. Rptr. 160, involved discipline based on section 6106, among other rules, imposed on a California lawyer who, after being removed as co-executor of his father’s estate sent 53 threatening and abusive voicemail messages to the successor administrator of the estate, the attorney for the administrator, and the ex officio judge of the Forsyth County Superior Court of North Carolina.  The Review Department bottomed its analysis on the threatening nature of these voicemail messages, which caused the recipients to fear for their personal safety.  Review Department also dismissed Elkins’s First Amendment argument.

Another possibility is new Rule of Professional Conduct 8.4(d), which states that it is professional misconduct to “engage in conduct that is prejudicial to the administration of justice.”  Long present in the ABA Model Rules of Professional Conduct, the import of this new section is not yet clear.  But other states have used it to impose discipline and the Supreme Court, which approved this rule, has reminded this that these are intended to be discipline rules, not just statements of aspiration. Not every instance of discourtesy or incivility would prejudice the administration of justice but a prolonged campaign of abuse with the purpose of beating a settlement out of the other side just might.

Those who labored long and hard to bring civility codes into existence may not have labored in vain. Clearly, discipline is an extreme remedy, as Rule 83.4 indicates, but it just might be available in extreme cases.


 

Daughter of “Fortune”: Disbarment Recommendation Reduced to 60 Days Actual

A previous post “Reversal of Fortune” discussed the Review Department’s unpublished decision in the Bradshaw matter that reversed a Hearing Judge’s recommendation of disbarment and dismissed the matter, finding no culpability.

Now in a similar case, the Review Department has reversed another Hearing Judge’s disbarment recommendation and recommended discipline to include 60 days actual suspension, now in a published decision (In the Matter of Lingwood, filed August 27, 2019.) The decision is based on an admission and finding that the respondent violated former Rule of Professional Conduct 3-300 (now Rule 1.8.1.)

Both Bradshaw and Lingwood are cases where a lawyer was serving as trustee of a trust.  Both cases involved allegations that the lawyer engaged in self-dealing and misappropriated funds from the trust, acts of moral turpitude, in violation of Business and Professions Code section 6106.  Both resulted in culpability findings on this issue that were ultimately reversed, based on part of the specfic authorizations in the trust instruments that authorized the trustee to engage in “self dealing” consistent with the trustee’s fiduciary responsibility.  The clause in Bradshaw’s case provided

As long as the Trustee does not act in bad faith or in disregard of the purposes of the Trust, it is not a breach of the Trust for the Trustee to take any of the following actions: ¶ Employ the Trustee, a relative of the Trustee, or a business in which the Trustee has an interest, to perform needed services for the Trust or any business in which the Trust has an interest and pay compensation not exceeding fair market value . . . .

What can explain the blind spot that has now led to two significant reversals?   Part of the answer may lie with the Review Department’s decision in In the Matter of  Schooler (Review Dept. 2016) 5 Cal. State Bar Ct. Rptr.__, 2016 WL 7176690 (filed December 6, 2017.)  Schooler involved a lawyer acting as trustee and conservator of a family trust who committed multiple breaches of fiduciary duty and made misrepresentations to the Court.  Schooler was disbarred after Office of Chief Trial Counsel (OCTC) appealed a hearing recommendation of two years actual suspension.

Schooler was, rightly, regarded as an important opinion.  Published opinions in State Bar Court are meant to provide guidance to the litigants. Unfortunately, Schooler appears to have furnished a convenient prism distorting the view of subsequent cases involving attorney as trustee misconduct.  Precedent is a tricky thing in an environment where the correct decision involves a “on a balanced consideration of the unique factors in each case.”  In the Matter of Van Sickle (Review Dept. 2006) 4 Cal. State Bar Ct. Rptr. 980, 2006 WL 2465633 (pet. review denied.)

Van Sickle is an echo of the same phenomenon.  The opinion on remand came about because OCTC appealed the first Van Sickle decision to the California Supreme Court because it ran afoul of the bright and shiny toy that OCTC thought it had been given by the Supreme Court, In Re Silverton (2005) 36 Cal.4th 81, which was interpreted as making the discipline Standards as binding law.  The Supreme Court sent Van Sickle back for reconsideration in light of Silverton, and the Review Department met the serve with an well researched opinion demonstrating why Silverton was really just a re-cap of existing law and not the revolutionary decision as hailed. But for awhile Silverton was everywhere being cited as authority that the Standards just had to be complied with.

Guidance is especially hard to come by in the murky land of moral turpitude.  The Lingwood Review Department finds it necessary to remind us that “mere negligence in making a representation does not constitute a violation of section 6106″citing In the Matter of Respondent K (Review Dept. 1993) 2 Cal. State Bar Ct. Rptr. 335, 353), in concluding that Lingwood’s statements were made with no intent to deceive.  it is a welcome taste of common sense in the face of the elastic concept of “moral turpitude through gross negligence.” (See In Matter of Yee (Review Dept. 2014) 5 Cal. State Bar Ct. Rptr. 330, 2014 WL 3748590 (Remke, PJ, dissenting.)

You might argue that the system worked as it should.  Until you consider the costs to the Respondents for fighing it out. Ms. Lingwood, found culpable on the count she admitted to, will pay the State Bar’s costs despite having much of case thrown out.

Reversal of Fortune: Disbarment Becomes Dismissal on Appeal

A recent unpublished but public opinion from the State Bar Court Review Department tells a story unique in most observer’s experience:  a disbarment recommendation from the Hearing Department is completely overturned on appeal and the case is dismissed.

The case is In the Matter of Bradshaw, State Bar Court case no. 16-O-15588, opinion filed July 30, 2019.

Bradshaw created testimentary documents, including a revocable living trust, for his client Ora Gosney in 2006.  After she fell and became incapacitated in August 2013, he became her conservator and spent money from her trust for repairs on her house,  contracting the work to a company he had played some role in setting up.  After he was removed as conservator by the San Francisco Superior Court, the State Bar Office of Chief Trial Counsel brought discipline charges alleging misrepresentations, a scheme to defraud the trust and misappropriation of money from the trust, all acts of moral turpitude in violation of Business and Professions Code 6106 the amounts paid for the repair work done on Ms. Gosney’s home.  Mr. Bradshaw’s State Bar member page was tagged with a “Consumer Alert” badge when the discipline charges were filed.  After a three week trial, the hearing judge issued her deciscion recommending disbarment and placing Bradshaw in involuntary inactive enrollment on August 30, 2018.

The Review Department reversed, finding that the evidnce for moral turpitude was not clear and convincing, the burden of proof in a disciplinary proceeding.  It noted that Ms. Gosney wanted to keep living at home, that the work was necessary and priced at fair market value.  Moreover, there was no evidence that Bradshaw, while involved in its creation, had an ownership interest, as found by the Hearing Judge.

The dismissal means that Bradshaw will be able to recover some of his out of pocket costs for the long trial and appeal but not his attorney fees.  There will be no compensation for being branded as a consumer threat and for the year of ineligibility to practice law.

The Superior Court decision to remove Bradshaw as conservator undoubtedly loomed large in the decision to prosecute this case and the Hearing Judge’s decision as well.  But civil and criminal courts do get it wrong and cutting through the deference given those decisions in the discipline system takes hard work and the skill of an experienced discipline defense lawyer.  Bradshaw luckily had one and apparently the resources to keep fighting after a bruising trial.  Yes, the system did work as it was supposed to but you can’t help wondering if this trip was really necessary.