The Emily Latella Decision

In a highly unusual decision, a division of the District of Columbia Court of Appeals took back a disbarment it ordered in March and made it a one-year suspension.

The case involved failure to pay medical providers with funds entrusted for that purpose contrary to an assignment and authorization.

The court’s original opinion in this matter was issued on March 8, 2018. After its issuance, respondent Brandi Nave petitioned for rehearing and rehearing en banc. On June 21, 2018, an order denying the petitions was issued prematurely and, we have determined, improvidently. Accordingly, the order of June 21, 2018, denying respondent’s petition is hereby withdrawn. Upon consideration by the full Division of the petition for rehearing, a majority of the Division has determined to grant the petition and to issue this amended opinion. The opinion reported at 180 A.3d 86 (D.C. 2018) is hereby vacated. The petition for rehearing en banc is denied as moot.

Footnote 1

We have not simply “changed our mind,” as our dissenting colleague suggests. Post at 25. Rather, we have acted upon a recognition that, as respondent pointed out in her Petition for Panel Rehearing, the original majority opinion and concurrence, like the Hearing Committee and the Board on Professional Responsibility (the “Board”), “overlooked and misquoted material [portions of] [r]espondent’s testimony.”

Having found misappropriation in March, the court now finds otherwise and reduced the sanction accordingly.

The court majority reviewed the evidence at length but in a manner that drew a sharp dissent.

As to sanction, no need to remand

we would remand to the Board for its recommendation regarding a sanction for the Rule 1.15 violations relating to untimely payment to third parties. However, the Board found 34 separate violations with respect to timely paying the medical providers, and we conclude that this warrants a sanction at the higher rather than lower end of the range that both the Hearing Committee and Disciplinary Counsel recommended to the Board. We therefore have determined to impose on respondent the sanction of a one-year suspension…

With automatic reinstatement. 

Which is one reason why remand (at a minimum) is appropriate to consider whether a fitness requirement should be imposed. 

Senior Judge Michael Farrell 

My colleagues have changed their mind and, by focusing on three of the nearly nineteen client matters relied on by the Hearing Committee and the Board on Professional Responsibility, now conclude that Disciplinary Counsel failed to prove by clear and convincing evidence that respondent misappropriated funds received from medical insurers that either should have been paid to medical providers on receipt or held in trust pending resolution of disputes with the provider. Respondent’s dealings with one provider, MSS, are chiefly at issue, but the Hearing Committee found that, as to a second provider as well, Dr. Yousefi, respondent misused funds (in part for personal litigation expenses) and at the evidentiary hearing “duplicitous[ly] characteriz[ed]” her behavior in failing to keep the funds in trust.  I dissent for the reasons stated in our previously issued opinion for the court, reported at 180 A.3d 86 (D.C. 2018).

“A central issue,” the majority recognizes, is when respondent actually received settlement checks from the insurance companies, thereby triggering her duty either to pay the provider or to deposit and hold disputed funds in trust. In now deciding favorably for respondent, the majority first dismisses the Board’s key reliance on respondent’s own “‘repeated[]”’ and “‘insistent[] urg[ing]’” before the Hearing Committee “‘that all settlement funds at issue . . . were timely deposited in her trust fund’” contemporaneously with their receipt well before the twin October out-of-trust dates. Id. at 88 (quoting Board). Its two reasons for disregarding that admission are far-fetched. First, respondent’s multiple concessions that she received settlement checks “on or about” specified dates before October carry no weight for the majority because, in criminal procedure, an indictment charging a crime “on or about” puts a defendant on notice “that a particular date is not critical.” Ante at 11 (citing criminal case authority for much as five months). So respondent, we are asked to believe, could have had in mind the usage in criminal charging documents when acknowledging her receipt of payments, rather than the meaning “on or about” conveys to an ordinary hearer. See On or About, BLACK’S LAW DICTIONARY (10th ed. 2014) (“on or about” means “[a]proximately; at or around the time specified”) (emphasis added). Second, the majority says that Disciplinary Counsel’s reliance on the “account balance methodology” at the hearing surprised respondent such that she had no reason to know in pleading “that more precision in her answers about dates” was required. Ante at 10. But, as Disciplinary Counsel points out, “[u]ntil the post-hearing briefs, [r]espondent never raised any doubt about when she actually received the money she was required to hold in trust for her clients’ medical providers.” And, as an experienced member of the bar, respondent surely knew that lack of “precision” in her admissions would not justify a delay of months between receipt of entrusted funds and their payment to the provider or deposit in escrow

In sum, the Board and the Hearing Committee could properly conclude that respondent, in repeatedly admitting close contemporaneity between the clients’ signing of settlement sheets and her receipt and deposit of insurance payments, was neither misled in her answers nor mentally reserving a (quasi-criminal) defense of receipt of payments much later than she acknowledged.

Notably 

The majority repeatedly appears to credit respondent’s hearing testimony, or to reject the Hearing Committee’s decision to discredit it, or conversely to rely on the Committee’s not having expressly discredited parts of it the majority thinks telling – all related to respondent’s insistence that she was still negotiating matters well after the October dates. But, like the Board, I find ample reason in the record for the Hearing Committee to find appellant’s often-confused testimony about her ongoing negotiation and delay in receiving insurance funds unreliable…

Altogether, as the Hearing Committee found, respondent simply “used further delay of payment as leverage”: although the insurers had “paid settlements . . . without reserving any right to challenge the integrity of medical bills,” respondent “was able to bully or scare MSS into agreeing to some further reductions that inured to the benefit of a few of her clients” – a “windfall for some clients” resulting from “the derogation of her duties to the medical providers” and the accompanying risk of lawsuits by MSS against other clients. These findings, echoing the Committee’s finding of “duplicitousness” in her dealings with Dr. Yousefi and testimony about them, are not clearly erroneous. The unanimous Board therefore had sound reason to conclude, that as to the Proctor, Wooten, and Allen matters, like most others, “[r]espondent’s attempted justification of her tardy payments to MSS relies essentially on her own testimony, which the Hearing Committee rejected” (italics added), and that, in her testimony, respondent “proffered utterly meritless excuses for her failures promptly to pay her clients’ medical providers” or alternatively hold the received funds in trust. Respondent’s repeated shortfalls in her trust account were not severe, but Disciplinary Counsel, aided by respondent’s unconvincing explanations, see In re Thompson, 579 A.2d 218, 221 (D.C. 1990), proved them by clear and convincing evidence.

The per curiam opinion was adopted by Associate Judges Thompson and Beckwith.

Unfortunately, another division of the court recently declined to accord comparable scrutiny to a grossly deficient hearing committee report that ignored the evidence to absolve the lawyers.

The title? See here. (Mike Frisch)