Insufficient Proof Of Unauthorized Practice

The Ohio Supreme Court has rejected findings of unauthorized practice brought against a debt relief business on grounds of insufficient evidence

In an August 26, 2021 revised report, the [Board on the Unauthorized Practice of Law]  found that Nationwide and the Pro-Net respondents had engaged in the unauthorized practice of law by providing advice and counsel to six Ohio customers regarding their debts and negotiating, drafting, and reviewing settlement agreements on behalf of those customers. For the reasons that follow, we find that there is insufficient evidence in the record to support the board’s findings that Nationwide and the Pro-Net respondents engaged in the unauthorized practice of law in Ohio. Accordingly, we dismiss this case.

Findings below

The board found that Pro-Net had been a closely held corporation that had been formed under the laws of California and that had done business in Ohio. Bloom, a California resident, was the sole shareholder and president of Pro-Net until the company ceased operation in August 2010. Pro-Net provided debt negotiation services for customers in various states through its business relationship with Nationwide, which is also a California corporation. None of the respondents is an attorney licensed to practice law in the state of Ohio.

Unauthorized practice

Here, the board found that Nationwide and the Pro-Net respondents, through the actions of Nationwide, (1) negotiated and settled debts on behalf of Ohio customers with their creditors and counsel for their creditors, (2) provided advice and counsel to Ohio customers about debt settlements, and (3) drafted, reviewed, and validated settlement agreements and term agreements.

Yet relator has presented no direct evidence from any of Nationwide’s customers, their creditors, or their creditors’ counsel who participated in those alleged negotiations. Instead, relator has submitted the affidavit and deposition testimony of Bloom along with the stipulations of the Pro-Net respondents. None of that evidence provides sufficient detail for this court to independently determine whether Nationwide’s conduct crossed the line from permissible debt-settlement negotiations to the rendering of legal services that constitute the unauthorized practice of law under Watkins Global, 159 Ohio St.3d 241, 2020-Ohio-169, 150 N.E.3d 68. On the contrary, the evidence offers little more than conclusory statements about the general nature of the actions that Nationwide took on behalf of its Ohio customers.

…In light of these significant evidentiary deficiencies regarding the specific actions that Nationwide undertook on behalf of its customers, we cannot find that relator has submitted sufficient sworn or certified evidence to support its motion for default against Nationwide. Nor can we find that relator has proved by a preponderance of the evidence that the Pro-Net respondents engaged in the unauthorized practice of law through the actions of Nationwide.

(Mike Frisch)