Torrens v. Hood
727 F.3d 1360
| 11th Cir. | 2013Background
- Hood met with Torrens Law Firm for foreclosure defense; paid $1,000 retainer but could not afford full representation for both foreclosure and bankruptcy.
- A courier filed a pro se Chapter 13 petition on Hood’s behalf via power of attorney on February 21, 2012; firm employees completed the standard fill‑in petition using Hood’s oral answers and Hood signed the petition.
- After a major client learned of the filing, Hood (represented by counsel) disavowed knowledge and moved for an order to show cause against the firm.
- The bankruptcy court found the firm acted as ghostwriters, violated 11 U.S.C. §§ 527, 528(a)(1), Florida Rules of Professional Conduct 4‑3.3(a)(1) and 4‑8.4(c), and possibly 18 U.S.C. § 157(3); it suspended and enjoined firm members and referred matters for criminal and bar discipline.
- The district court affirmed; on appeal the Eleventh Circuit reviewed de novo legal conclusions and for clear error factual findings, and it reversed and remanded, holding no fraud or sanctionable ghostwriting occurred.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether firm perpetrated fraud on the court by ghostwriting Hood’s pro se Chapter 13 petition | Firm secretly drafted and filed petition to stall foreclosure and mislead the court | Firm only served as a scrivener: filled blanks from Hood’s oral answers and did not "draft" the form | Reversed — completing a standardized fill‑in petition from the client’s responses is not "drafting" under Rule 4‑1.2(c); no fraud found |
| Whether nondisclosure of attorney assistance in completing pro se petition violated Florida ethics rules (4‑3.3 and 4‑8.4) | Undisclosed assistance rendered the filing false/misleading and thus unethical | Rule 4‑1.2(c) governs ghostwriting; attorneys need not sign simple fill‑in forms if not drafting substantive content | Held for defendants — no false statements or deceit where petition was a standard form filled from client’s input and contained no false information |
| Whether bankruptcy court had reasonable grounds to report criminal bankruptcy fraud under 18 U.S.C. § 157(3) | The filing was part of a scheme to defraud creditors and conceal proceedings | No evidence that firm intended a scheme or that false statements were made to conceal fraud | Held: court erred to treat conduct as criminal fraud in these circumstances; referral unwarranted on record |
| Whether sanctions (suspension, injunctions, referrals) were an abuse of discretion | Sanctions necessary to punish and deter undisclosed ghostwriting and protect the court | Sanctions were excessive where conduct was limited to filling blanks on a public form and no fraudulent intent or false submissions were found | Held: bankruptcy court abused its discretion; sanctions reversed |
Key Cases Cited
- In re Optical Techs., Inc., 425 F.3d 1294 (11th Cir. 2005) (standard of appellate review for bankruptcy findings)
- In re Englander, 95 F.3d 1028 (11th Cir. 1996) (clear error and de novo review standards)
- In re Mroz, 65 F.3d 1567 (11th Cir. 1996) (review of sanctions for abuse of discretion)
- In re James, 406 F.3d 1340 (11th Cir. 2005) (use of dictionary definitions to interpret rule language)
- Duran v. Carris, 238 F.3d 1268 (10th Cir. 2001) (requiring disclosure/signature for ghostwritten briefs)
- Ellis v. Maine, 448 F.2d 1325 (1st Cir. 1971) (attorney‑prepared briefs must be signed)
- In re Liu, 664 F.3d 367 (2d Cir. 2011) (permitting nondisclosure for largely non‑substantive petitions)
- Hargis v. Access Capital Funding, LLC, 674 F.3d 783 (8th Cir. 2012) (distinguishing standardized fill‑in forms from the practice of law)