In the Matter of Thomas, Review Dept. State Bar Court, 15-O-14870; SBC-20-O-00029 (Consolidated). filed 8/26/22. Respondent lawyer was admitted to practice in 1978. Despite a lack of prior discipline, the Review Dept. upheld a hearing judge’s recommendation of disbarment. Respondent engaged in a pattern of frivolous and harassing litigation over a period of eight years, which generated sanctions of $188,350.64. None of the sanctions were reported to the State Bar and none of this amount of was paid. The original litigation began in 2012 with a real estate dispute involving the True Harmony company. The lawyer was found to have violated section 6068, subdivision (c), by
“(1) making multiple claims and argument slacking any legal or factual basis and filing and pursuing an untimely motion (despite being forewarned that the motion was without merit and should be dismissed) in the interpleader action;
(2) filing a frivolous appeal of the interpleader action, which lacked any merit and was prosecuted for the improper purpose to harass and increase litigation costs;
(3) filing a motion for reconsideration in the True Harmony matter, which had no basis in law and unnecessarily increased the costs of litigation; and
(4) repeatedly pursuing improper appeals and filing frivolous and harassing briefs and/or motions, which unnecessarily increased the costs of litigation in the appeal of the True Harmony matter.
The hearing judge found culpability under section 6068, subdivision (c), for [the lawyer’s] use of abusive litigation tactics where he initiated and maintained multiple claims and defenses, at the trial and appellate levels, which were foreclosed by legal authority.”
The lawyer was also found to have violated former Rule 5-100 by threatening criminal charges against opposing counsel to gain an advantage in the civil litigation. He was also found culpable of violating Business and Professions Code section 6103 by failing to pay the sanctions and section 6068(o)(3) by failing to report the sanctions. Aggravation was found in a pattern of misconduct, significant harm to the opposing party and the administration of justice, and indifference toward rectification of the misconduct.
The lawyer made a number of arguments, including collateral attacks on the civil judgments, Constitutional objections, and unclean hands by the Office of Chief Trial Counsel (OCTC) in not investigation his claims of misconduct by opposing counsel. The Review Department rejected these arguments. Giving substantial weight to aggravating factors, including a pattern of misconduct spanning years, it recommended disbarment. Respondent now has the option of petitioning the Supreme Court, which he has vowed to do. In this closing argument at trial, Respondent stated that he was going to “stick to his guns” and so far he has been true to his word.
In the Matter of Isola, Review Dept., State Bar Court case no. SBC-20-O-30310, filed 5/22/22, disciplinary recommendation pending before the California Supreme Court.
The Office of Chief Trial Counsel (OCTC) filed a notice of discipline charges pleading 26 counts of misconduct, including acts of moral turpitude, misrepresentation, and misappropriation of funds. It sought disbarment. After 11 days of trial, the hearing judge issued a decision dismissing some of the charges and recommending a two-year actual suspension. Both sides sought review. The Review Dept., a lengthy 46-page decision, finds only two counts of failing to communicate with the client and recommends a 30-day actual suspension.
Can we say that the system worked the way it was supposed to?
Part of the answer depends on the peculiar doctrine of moral turpitude as applied in disciplinary proceedings. The concept was abandoned by the American Bar Association when it wrote the Model Rules of Professional Conduct in the early 1980s but it lives on in California disciplinary jurisprudence through our Business and Professions Code section 6106:
The commission of any act involving moral turpitude, dishonesty or corruption, whether the act is committed in the course of his relations as an attorney or otherwise, and whether the act is a felony or misdemeanor or not, constitutes a cause for disbarment or suspension.
If the act constitutes a felony or misdemeanor, conviction thereof in a criminal proceeding is not a condition precedent to disbarment or suspension from practice therefor.
Bus. & Prof. Code section 6106
Moral turpitude also figures prominently in the statutes governing the criminal conviction referral process. Business and Professions Code section 6101 provides that conviction of a felony or misdemeanor crime involving moral turpitude is a cause for suspension of disbarment. It also requires a criminal court to transmit the record of a criminal conviction of a California lawyer to the State Bar within 48 hours. The State Bar must in turn file the record of any conviction which involves or may involve moral turpitude in the State Bar Court (standing in for the California Supreme Court) within 30 days of receipt. Conviction of any felony, or misdemeanor involving moral turpitude, triggers interim suspension (Bus. & Prof. Code section 6102(a)) and conviction of felony involving moral turpitude is punishable with summary disbarment under section 6102(c).
What is moral turpitude? The California Supreme Court has struggled to define it.
“Moral turpitude is a concept that “defies exact description” [citation] cannot be defined with precision [citation] We have noted, however, that in attorney discipline cases, moral turpitude should be defined with the aim of protecting the public, promoting confidence in the legal system, and maintaining high professional standards. [citation].” In re Grant (2014), 58 Cal. 4th 469, 475–476. Moral turpitude is similar but broader than ABA Model Rule 8.4(b) which states that “It is professional misconduct for a lawyer to:… (b) commit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects.” Promoting confidence in the legal profession means that moral turpitude can reach many kinds of activity not directly related to the practice of law
Grant had been convicted of possession of child pornography (Penal Code section 311.11(a).) The State Bar Court hearing judge determined that the conviction involved moral turpitude and recommended disbarment. “The judge reasoned that the conviction “involve[d] such a serious breach of a duty owed to another or to society, or such a flagrant disrespect for the law or for societal norms, that knowledge of [Grant’s] conduct would be likely to undermine public confidence in and respect for the legal profession,” and is, therefore, a conviction of a crime involving moral turpitude (Grant, at 474.) The Review Department, which had initially determined the crime as one that may or may not involve moral turpitude, thus entitling Grant to an evidentiary hearing, reversed, finding that the admissible evidence did not support a finding of moral turpitude. It recommended three years’ probation with an actual suspension of two years. On petition for review by the Office of Chief Trial Counsel (OCTC, the State Bar’s discipline prosecution office) the Supreme Court held that violation of section 311.11(a) was a crime of moral turpitude per se and thus mandated summary disbarment.
The vague definition of moral turpitude is problematic because it contains an element of subjectivity sometimes approaching Potter Stewart’s famous statement on obscenity (“I can’t define it but I know it when I see it.”) As a result, OCTC’s practice of liberally charging moral turpitude has been the subject of much contention with the professional discipline defense bar. At a recent meeting of a working group of State Bar’s Ad Hoc Commission on the Discipline System, a body charged with studying the fairness of the discipline system, defense counsel representatives proposed adding a probable cause hearing to State Bar discipline procedure, with the goal of culling out unsupported moral turpitude charges at an early stage of the proceeding and promoting settlement. Respondents are reluctant to stipulate to charges of moral turpitude because of the implication of immorality, even though the Supreme Court has stated that gross negligence alone can support a finding of moral turpitude (see In the Matter of Yee (Review Dept. 2014) 5 State Bar Ct. Rptr. ____ , Remke, J. dissenting.) Yee was found culpable of an act of moral turpitude because she mistakenly certified her MCLE compliance from memory without checking her records. The Review Department upheld the decision, provoking a rare dissent from the Presiding Judge of the State Bar Court.
Case law has defined moral turpitude in dramatic terms. “Moral turpitude” is defined as the “general readiness to do evil.” People v. Castro (1985) 38 Cal.3d 301, 313–316. Moral turpitude is defined as ‘everything done contrary to justice, honesty, modesty, or good morals’. In re McAllister, (1939)14 Cal. 2d 602, 603. Moral turpitude has been defined as: ‘An act of baseness, vileness or depravity in the private and social duties which a man owes to his fellow men or to society in general, contrary to the accepted and customary rule of right and duty between man and man.’ In re Boyd (1957) 48 Cal. 2d 69, 70. That the concept is so elastic that is encompasses Ms. Yee forgetting to check her MCLE records as well the most heinous crimes such as murder and child pornography is a measure of how flawed it is.
16 of the 26 discipline charges in Isola alleged acts of moral turpitude in violation of section 6106. None of those charges were upheld, although it is still possible that OCTC will petition the California Supreme Court. Mr. Isola went through 11 days of trial and doubtless had to pay his experienced State Bar defense counsel a lot of money. Because he was found culpable on two charges with a recommendation of public discipline, he will also have to pay $22,136 in costs to the State Bar, according to the latest cost schedule.
Discipline is an adversarial process. Inherent in that is the possibility that parties, and judges, will get things wrong. That is part of why we have review as a matter of right in the State Bar Court and discretionary review in the California Supreme Court. Putting the best face on things, OCTC might say that the system worked exactly as it was supposed to, that its prosecutor was entitled to make her case within the office’s prosecutorial discretion and she should not be second guessed. Given the consequences to Mr. Isola it is hard to credit that view. Vague concepts like moral turpitude invite prosecutorial abuse and this case is not the only example.
There is a lot of information on the State Bar of California website. But one thing you will not find. You won’t find decisions from the Hearing Department of the State Bar Court.
The State Bar Court page has a link to Hearing Department decisions. But you won’t find any after January 2019. That is, you won’t find recent ones. Instead, you will see this:
Hearing Department decisions are accessible from April 2014 through January 2019, at which point they vanish. If you want to see a Hearing Department decision after January 2019, you will have to know the specific case number or Respondent’s name.
Not coincidently, January 2019 was when the State Bar’s new case management system, aptly named Odyssey, came online. The same Odyssey implicated in the recent disclosure of confidential information now conceded to be the result of a flaw in the software provided by Tyler Technologies, the State Bar vendor, and not the result of some nefarious hack.
Long ago in the mists of history, longer even than the nine years Odysseus wandered on the wind dark ocean sea, the Association of Discipline Defense Counsel (ADDC) asked then Chief Trial Counsel James Towery (now Judge Towery) to provide copies of the Hearing Department decisions. The reason was to educate defense counsel about what was happening in State Bar Court to better advise their clients on what to expect in State Bar Court litigation and obtain knowledge that might lead to better trials and more settlements. Only about 50% of respondents are represented by counsel in the State Bar Court and not all of them by members of the ADDC. Only two institutions are privy to the complete picture of what goes on in the State Bar Court, the Court itself and the prosecutor, the Office of Chief Trial Counsel (OCTC). Discipline defense counsel are like the blind men in the parable: a trunk here, a leg there but no overall appreciation for what the elephant was. Judge Towery readily agreed.
Later on, in 2014, the State Bar Court began publishing links to a monthly list of decisions from the Hearing Department, a rather lazy solution compared to the full access the State Bar Court affords to decisions published and unpublished from the Review Department. But a better solution in terms of allowing access to the public at large access and understanding of the work of the Hearing Department. And, most importantly, a solution that allowed access to the entire corpus of that work, the cases where OCTC was successful as well as the cases where OCTC was not successful, either because the recommended discipline was less than that advocated by OCTC or because OCTC failed to prove any part of its case, resulting in a dismissal of charges.
Transparency and the public’s right to know have been trumpeted by the State Bar in advocating many policies, including posting the notices of disciplinary charges on the State Bar’s website before those charges are proven and the posting of the Consumer Alert badges in ever-expanding categories of cases, most recently, cases involving felony convictions.
These measures serve to protect the public, it is argued, by alerting consumers of legal services that the attorney that they might be thinking of hiring presents a potential danger. But it also serves the State Bar’s purpose to assure the public and the profession that it is zealously working to protect them. For the same reasons, attorneys who have been publicly disciplined are subject to publicity regarding their discipline, including inclusion in the Discipline Reports published in traditional legal newspapers and, more recently, postings on LinkedIn.
Discipline defense counsel know they do because we often achieve good results for our clients at trial, sometimes including complete dismissals. But the second purpose, the public relations purpose, isn’t served by disseminating information regarding OCTC’s failures. Finding information on the cases that OCTC loses, including how far they fell short and why is difficult.
But the overall picture is murky. The State Bar does publish statistics in the Annual Discipline Report but no detailed information as to why cases filed in State Bar Court are resolved with no action. For instance, the Annual Discipline Report for 2020 contains an entry for cases closed by the State Bar Court with no action, with an explanatory footnote stating that this could occur for many reasons, including “(1) respondent was disbarred in another matter; (2) respondent was ordered inactive pursuant to Business and Professions Code section 6007(b); (3) respondent’s death, shortly before or after dismissal; (4) respondent’s resignation; (5) dismissal by OCTC; and (6) dismissal by State Bar Court.”
As you can see, those numbers are not broken down by the types listed in the footnote.
Moreover, while complete dismissals are relatively few, there are no statistics on the much larger number of cases where OCTC sought a higher level of discipline than was ultimately decided on by the Court. This information can only be understood by an examination of the decisions themselves.
When Odyssey went live in January 2019, we were told that it would lead to greater transparency because it would allow the publication of the entire State Bar Court docket in each case online. This is true but misleading. More information is not necessarily better information, and without access to all Hearing Department decisions in one place, it is impossible for outsiders to fully analyze just how well OCTC is doing, measured by the yardstick of success in State Bar Court. Undoubtedly, OCTC closely analyzes each Hearing Department decision to determine whether to appeal it to the Review Department.
This information should be easily obtainable. Yet efforts by defense counsel to obtain these decisions have so far met with no success. And because State Bar Court no longer publishes even links to the decisions, they remain hidden from public view, accessible only in the dockets of individual cases. This is odd given that Review Department decisions are easily accessible. Whatever the explanation, this is incompatible with a government agency that has made transparency and the public’s right to know a central argument for publicizing its work.
Part of my daily routine is visiting the State Bar Court website to see if any new Review Department decisions have arrived (https://www.statebarcourt.ca.gov/Review-Department-Dispositions). The State Bar Court is an administrative law court within the judicial branch that adjudicates discipline and other attorney regulation matters. The Review Department is the appellate court in this system; its three judges hear appeals from the five judges in the Hearing Department and have original jurisdiction on some matters.
The State Bar Court has been created by the Legislature but it had been described as the administrative arm of the California Supreme Court for the purposes of attorney regulation, chiefly discipline and licensure. For that reason, most decisions of the State Bar Court are couched as recommendations to the Supreme Court, although the State Bar Court is empowered by statute to issue reprovals (Bus. & Prof. Code section 6077). In the normal course, discipline recommendations go up the mountain from both departments of the State Bar Court and are almost always approved; to my knowledge, in the 33 years I have been involved in the discipline system, only one discipline recommendation has been disapproved.
But there is another route to review by the high Court and that is filing a petition for review of a State Bar Court (Cal. Rule Ct. 9.13 generally with special requirements for the Office of Chief Trial Counsel (OCTC) in Cal. Rule Ct. 9.14.) This route requires exhaustion of remedies in State Bar Court by requesting review from the Review Department first (Cal. Rule Ct. 9.13(e)(1).) It is also completely within the discretion of the Supreme Court. In In Re Rose(2000) 22 Cal. 4th 437, the Court held, over the dissents of Justices Kennard and Brown, that the Court was not constitutionally required to hear a petition for review from a respondent. Since the State Bar Court in its current full-time professional form was created in 1989 and the “finality” rules in Title 9 of the California Rules of Court were enacted in 1992, the Court has taken up petitions from only a handful of respondents and in all but one of those matters (In Re Morse (1995) 11 Cal. 4th 190), the respondent has been disbarred, as was Mr. Rose. OCTC has not done much better; only one petition for review has been accepted and resulted in a published discipline opinion, In the Matter of Grant (2014) 58 Cal.4th 469. That case resulted in the State Bar Court’s recommendation of two years actual suspension increased to disbarment. It is hard not to form the impression that the Supreme Court is only interested in taking up discipline cases for full review when the discipline is perceived as too lenient or some legal issue, such as the scope of the summary disbarment statute (see In re Lesansky (2001) 25 Cal. 4th 12), needs clarifying.
The lack of Supreme Court interest is by design. If you pick up and leaf through the California Reports from the 1970s and 1980s (I know: how quaint) you will be astonished at the amount of dead trees devoted to attorney discipline matters. The explosive growth of the legal profession in those decades dramatically increased the number of discipline matters and the pre-Rose Court still felt an obligation to take them up. Part of the reason for creating a full-time professional State Bar Court with the ability to publish its own decisions as guiding precedent (at least in State Bar Court) was to relieve the high court of this responsibility. And it worked. The number of published discipline cases from the California Supreme Court since 1992 will be accommodated by your two hands.
Petitions for review still get filed, of course. The State Bar Court website now accounts for them with a new category “Opinions Designated for Publication” designed for opinions that have been published under State Bar Rule of Procedure 5.162, thus potentially citable but that are the subject of a pending Supreme Court petition. And, in a lovely display of symmetry, there are two, one a petition filed by a respondent (In the Matter of Shkolnikove) and one a petition filed by the OCTC (In the Matter of BB.) Both cases contain interesting issues that might actually tempt the Supreme Court to fully consider these cases. In Shkolnikove, the Review Department increased the recommended level of discipline from 45 days actual suspension to six months, reversing the Hearing Judge’s determination that Mr. Shkolnikove was a more credible witness than his former client Herrera, in spite of the long-standing principle that a Hearing Judge’s determination of credibility is entitled to great deference. In BB, the Review Department upheld the Hearing Department’s imposition of an admonition, a non-disciplinary disposition, in a case that involved a San Francisco Public Defender found to have demonstrated disrespect for the court (Bus. & Prof. Code section 6068(b)) and to have disobeyed a court order (Bus. & Prof. Code section 6103) in interfering with the arrest of his disruptive client in court. These offenses typically result in actual suspension and OCTC sought 30 days actual suspension at trial and before the Review Department.
Of course, it might be wishful thinking. I have long felt that the Supreme Court withdrawal from the discipline process in the 1990s was not a positive development and although they gotten more involved in recent years on the administrative side, that has not thus far translated to the litigation side. New Supreme Court case law in my area of jurisprudence is a rare treat. One can dream.
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.
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 plaintiffA 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.
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.
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.
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.
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. Wunsch84 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 6106. In 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.
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.
