Parker v. JacobsParker v. Jacobs
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MEMORANDUM OPINION AND ORDER
W. KEITH WATKINS, Chief Judge.Darryl A. Parker appeals the United States Bankruptcy Court for the Middle District of Alabama’s Order denying his motion to vacate, entered on June 2, 2011, and the Order entered on April 8, 2011, disbarring Mr. Parker from the practice of law in this district’s bankruptcy court. The appeal is brought pursuant to
I. JURISDICTION AND VENUE
Appellate jurisdiction of the district court to hear this appeal is exercised pursuant to
II. STANDARD OF REVIEW
Decisions regarding the imposition of sanctions are reviewed for an abuse of discretion. In re Walker, 532 F.3d 1304, 1308 (11th Cir.2008). Applying this standard, a reviewing court “ ‘must affirm
III. FACTUAL AND PROCEDURAL BACKGROUND
Mr. Parker, the appellant, is an attorney licensed to practice law in the state of Alabama, and represents debtors in Chapters 7 and 13 proceedings in the United States Bankruptcy Court for the Middle District of Alabama. Teresa Jacobs, the appellee, is the bankruptcy administrator for the United States Bankruptcy Court for the Middle District of Alabama, whose duties include “seekfing] to prevent, through monitoring and reporting, abuses in the bankruptcy system.” U.S. Bankr.Admin., M.D. Ala., http://www. almba.uscourts.gov. (last visited on Jan. 26, 2012).
On February 17, 2011, Ms. Jacobs initiated a miscellaneous proceeding in the bankruptcy court for sanctions against Mr. Parker, alleging multiple violations of
The misconduct for which Ms. Jacobs sought sanctions did not arise from a single case, but rather from multiple cases in which Mr. Parker was involved. Ms. Jacobs outlined a plethora of alleged
As further support for the motion for sanctions, Ms. Jacobs highlighted Mr. Parker’s own pro se Chapter 7 proceeding, which she argued was replete with false statements and incomplete disclosures. Citing the Alabama Rules of Professional Conduct, Ms. Jacobs argued that Mr. Parker’s transgressions were “indicative of a lack of the requisite, diligence, knowledge and skill necessary for [Mr.] Parker to competently represent clients in bankruptcy.” (Mot. Sanctions 4 (citing Ala. Rules of Profl Conduct R. 1.1 & R. 1.3).) She sought “appropriate sanctions ... sufficient to deter repetition and continuation of such conduct.” (Mot. Sanctions 4.)
The bankruptcy judge scheduled a hearing on the motion for sanctions for April 7, 2011, and provided notice to Mr. Parker, electronically to two e-mail addresses that Mr. Parker had listed with the bankruptcy court and by first-class mail to his office address. Mr. Parker did not appear for the hearing or file a response to the motion for sanctions. He also failed to notify the bankruptcy judge prior to the hearing that he would be absent. Mr. Parker’s
At the April 7, 2011 hearing, at which Ms. Jacobs appeared through her counsel, the bankruptcy judge summarized Mr. Parker’s violations: Mr. Parker “willfully ... hold[s] off on paying filing fees”; he does not “observe ... normal courtroom decorum”; he has made a “series of material omissions” and falsehoods in cases; and in one case, in particular, he “covered up one set of lies with another set of lies, and then a third set of lies, all quite willful.” (H’rg Tr. 8, April 7, 2011.) The bankruptcy judge concluded: Mr. Parker is “not a good detail man,” but even worse, he is “a dishonest, unethical lawyer [who] harms his clients, and [who] files false pleadings and false statements in Bankruptcy Court.” (H’rg Tr. 11, April 7, 2011.) The bankruptcy judge orally pronounced the sanction: He would “disbar ... [Mr. Parker] from practicing in bankruptcy court from this point forward and remove him as counsel of record” on his pending cases. (H’rg Tr. 9, 14, April 7, 2011.)
The bankruptcy judge followed through in a written order entered the next day on April 8, 2011. He reiterated the “numerous instances” where Mr. Parker “knowingly fil[ed] false statements with the Court,” including in his own Chapter 7 petition, and “fail[ed] to timely pay filing fees.” (Order 4, April 8, 2011.) He found that, in his own Chapter 7 case, Mr. Parker went so far to avoid creditor detection that, in his petition, he transposed his first and middle names (“Avon D. Parker” instead of “Darryl A. Parker”) and listed his city of residence as Auburn, Alabama, when in fact he lived in Montgomery, Alabama. The bankruptcy judge also referenced a Chapter 7 petition filed by Mr. Parker on behalf of a debtor (“the Porter-field case”), where he “knowingly and intentionally filed false schedules ... with the intent to defraud creditors” by reporting that the debtor was single and did not own any real property. (Order 2, April 8, 2011.) The bad faith conduct in the Port-erfield case did not end there. When the false statements were brought to light by the trustee in an adversary proceeding, Mr. Parker sought to dismiss Mr. Porter-field’s Chapter 7 bankruptcy case, which the bankruptcy court found was a violation of
Repetitive filing fee infractions also were enumerated by the bankruptcy judge. The bankruptcy judge relied upon the numerous petitions “where [Mr.] Parker ha[d] violated rules concerning the payment of filing fees,” as outlined in Ms. Jacobs’s motion for sanctions. (Order 5, April 8, 2011.) He also cited a case (“the Richardson case”) where he had repri
After reviewing the totality of Mr. Parker’s conduct across the spectrum of cases in which Mr. Parker had appeared, the bankruptcy judge concluded that Mr. Parker “ha[d] made a practice of misappropriating client funds and intentionally making false statements in his own and his clients’ bankruptcy petitions.” (Order 5, April 8, 2011.) Consequently, the bankruptcy judge “disbarred [Mr. Parker] from the practice of law in the United States Bankruptcy Court for the Middle District of Alabama,” reasoning that because the “violations of attorney ethics” by Mr. Parker were “so widespread,” the “only appropriate sanction [was] disbarment.”3 (Order 5, April 8, 2011.)
On April 14, 2011, Mr. Parker filed a motion to vacate the Order of disbarment. He contended that he missed the hearing “for good cause” because on that date he “was suffering from influenza, [f]ever, and other symptoms commiserate with this illness” and, as a sole practitioner, had nobody else to send in his place. (Mot. Vacate 1 (Doc. # 1-3).) He submitted a doctor’s note indicating that on April 8, 2011, the nursing staff identified “flu-like symptoms.” (Mot. Vacate, Ex. 1.)
The bankruptcy judge held a hearing on Mr. Parker’s motion to vacate on June 1, 2011. Mr. Parker showed up for this one. He admitted that he “was in over [his] head with bankruptcy,” and that he had “no intentions of ever trying to practice bankruptcy” again.4 (H’rg Tr. 5-6, June 1, 2011 (Doc. # 1-2).) He requested, however, that the “disbarment be revoked” as too “extreme under the circumstances.” (H’rg Tr. 7, June 1, 2011.) Although given the opportunity, he made no other substantive challenges to the bankruptcy judge’s April 8, 2011 Order.
Rejecting Mr. Parker’s argument that the sanction was too harsh, the bankruptcy judge reasoned that Mr. Parker had committed “just too many errors.” (H’rg Tr. 9, June 1, 2011.) In addition to competency and practice issues, there were intentional errors, including “willful filing of false schedules” and “conceal[ment] of assets” in the Porterfield case, and improper management of trust funds in the Richardson case (which appeared to amount to a “conversion of trust funds”). (H’rg Tr. 9, June 1, 2011.) The bankruptcy judge further noted Mr. Parker’s misconduct in his
IV. DISCUSSION
Mr. Parker’s appeal focuses on the bankruptcy judge’s sanction permanently disbarring him from practicing law in the United States Bankruptcy Court for the Middle District of Alabama. Although Mr. Parker’s arguments are disjointed and difficult to decipher, the court has done its best to discern his principal contentions. Before tackling Mr. Parker’s arguments, the court sets forth the legal standard that governs the bankruptcy judge’s imposition of sanctions.
A. The Source of the Bankruptcy Court’s Authority to Sanction Mr. Parker
The appropriateness of imposing sanctions “depends to some degree upon the statutory basis for their award, including the scope of the court’s authority under the statute.” Campos v. City of Naples, 202 Fed.Appx. 381, 386 (11th Cir.2006). The April 8, 2011 Order did not recite the authority the bankruptcy judge was acting upon when he sanctioned Mr. Parker. Ms. Jacobs’s motion for sanctions was grounded, however, on two sources,
1.
2.
any statement, or counseling] or advising] any assisted person ... to make a statement in a document filed in a case or proceeding under this title, that is untrue or misleading, or that upon the exercise of reasonable care, should have been known by [the debtor’s attorney] to be untrue or misleading.
3. Inherent Authority
Bankruptcy courts, like Article III courts, have inherent power to impose sanctions against attorneys for misconduct. See In re Evergreen See., Ltd., 570 F.3d 1257, 1263 (11th Cir.2009); see also
A court’s inherent power “can be invoked even if procedural rules exist which sanction the same conduct, for these rules are not substitutes for the inherent power.” In re Mroz, 65 F.3d 1567, 1575 (11th Cir.1995) (holding that “[t]he fact that rules such as Rule 11 and Bankruptcy
B. Whether the Bankruptcy Court Abused Its Discretion in Permanently Disbarring Mr. Parker from the Practice of Law in the United States Bankruptcy Court for the Middle District of Alabama
There is ample authority that a bankruptcy court has power to disbar an attorney from the practice of law in the bankruptcy court in its district for violations of
Based upon the foregoing authority, a bankruptcy court has power under
Mr. Parker contends that the bankruptcy judge abused his discretion in sanctioning him because his failure to attend the April 7, 2011 hearing for a “documented illness” provides insufficient grounds “for [djisbarment of an attorney from the practice of law in a jurisdiction.” (Appellant’s Br. 8 (Doc. #2).) He contends that the bankruptcy judge refused to consider that he was “legitimately absent from the hearing due to illness” and that other attorneys have failed to appear before the bankruptcy judge for a scheduled hearing and have not been disbarred. (Appellant’s Br. 8.) Implicitly woven through this written argument on appeal is his oral argument raised below that the sanction of disbarment is too “extreme under the circumstances.” (H’rg Tr. 7, June 1, 2011.) Mr. Parker’s argument misses the point.
It is true that Mr. Parker’s failure to attend the April 7, 2011 hearing factored into the bankruptcy judge’s decision to sanction him. It also is true that the bankruptcy judge was “dismay[ed]” by Mr. Parker’s absence. (H’rg Tr. 2, April 7, 2011.) Contrary to Mr. Parker’s assertion, however, there was more, much more. As to the bankruptcy judge’s refusal to reopen the hearing on the motion for sanctions, the bankruptcy judge was not as troubled with the merits of the excuse Mr. Parker offered as he was with Mr. Parker’s lack of professional courtesy. The bankruptcy judge stated that, even if he “acceptfed] the proposition that [Mr. Parker] could not attend the April 7 hearing” due to an illness documented in a “fairly vague” doctor’s letter, “there still [was] no excuse for [Mr. Parker] not calling.” (H’rg Tr. 8, June 1, 2011.) At the June 1, 2011 hearing, Mr. Parker offered no reason why he did not let the bankruptcy court know prior to the hearing that he would be unable to attend or why he waited six days after the entry of the Order
To begin with, the bankruptcy judge found that Mr. Parker “habitually e[ame] to Court late and unprepared” and many times “d[id] not attend scheduled hearings at all.” (Order 2, April 8, 2011.) This factual finding was not challenged by Mr. Parker, either below or on appeal.7 The bankruptcy judge also grounded his sanctions decision on numerous instances where Mr. Parker had filed petitions and other papers in the United States Bankruptcy Court for the Middle District of Alabama, knowing that they contained false information, in violation of
The bankruptcy judge also was personally familiar with Mr. Parker’s past misconduct. As one of two bankruptcy judges in this district, he had presided over many of the approximately forty-three cases filed by Mr. Parker, including the Porterfield case in which Mr. Parker attempted to “defraud creditors” through fraudulent misrepresentations about the debtor’s marital status and ownership of real property, and then sought to dismiss the debt- or’s ease when his deceit was uncovered. (Order 2, April 8, 2011.)
These instances amply illustrate the repeated, intentional, material misrepresentations and filing fee infractions that were at the core of the bankruptcy judge’s finding that the severe sanction of disbarment was appropriate. The knowing false statements, filed for fraudulent purposes, are indicative of bad faith and support the bankruptcy judge’s finding that Mr. Parker lacked “competence and [a] sense of ethics.” (Order 2, April 8, 2011.) The record also demonstrates violations of the Alabama Rules of Professional Conduct, in particular Rule 1.1. See Ala. Rules of Profl Conduct R. 1.1 (“A lawyer shall provide competent representation to a client.
Mr. Parker appeared time and time again in front of the sanctioning bankruptcy judge, making him the one in the best position to decide an appropriate sanction. See In re Evans, 801 F.2d at 706 (“ ‘[N]o other tribunal can decide, in a case of removal from the bar, with the same means of information as the [sanctioning] Court itself.’ ”) (quoting Ex parte Burr, 9 Wheat. 529, 22 U.S. 529, 530, 6 L.Ed. 152 (1824)). The bankruptcy judge was confronted with repeated misconduct, ranging in severity from dilatory to bad faith and occurring over a span of at least two years, that pervaded the vast majority of cases in which Mr. Parker had made appearances on behalf of debtors in the United States Bankruptcy Court for the Middle District of Alabama. The bankruptcy judge, concerned for some time about Mr. Parker’s misconduct, also was faced with the fact that merely a month after he had temporarily suspended Mr. Parker from filing any bankruptcy cases, Mr. Parker, with no advance notification, did not appear at the scheduled April 7, 2011 hearing to defend against Ms. Jacobs’s motion for sanctions. On this record and considering the misconduct in its totality, the bankruptcy judge did not abuse his discretion in permanently disbarring Mr. Parker from the practice of law in this district’s bankruptcy court. Mr. Parker’s concession as to his incompetence in the area of bankruptcy law and his proclamation that he “ha[s] no intentions of ever trying to practice bankruptcy” (H’rg Tr. 6, June 1, 2011) further demonstrate that a permanent suspension from practice in the bankruptcy court in this district is not too severe.9
Nonetheless, Mr. Parker contends that the bankruptcy court abused its discretion in imposing the disbarment sanction because it (1) “accepted as truth many assertions made by [Ms. Jacobs,] which were unfounded or patently false” and (2) improperly punished him twice for the same conduct by considering the evidence in the Porterfield case when deciding that permanent disbarment was the proper sanction. (Appellant’s Br. 9,10-11.)
Mr. Parker has waived these two arguments on appeal because he did not raise them below “at all.” Four Seasons Hotels & Resorts, B.V. v. Consorcio Barr S.A., 377 F.3d 1164, 1170 (11th Cir.2004); see also Formby v. Farmers & Merchants Bank, 904 F.2d 627, 634 (11th Cir.1990) (“As a general rule, an appellate court will not consider a legal issue or theory raised for the first time on appeal.” (citation and
Even if Mr. Parker’s arguments had not been waived, they lack merit. It is true that a bankruptcy court “would necessarily abuse its discretion if it based its ruling on ... a clearly erroneous assessment of the evidence,” Jones v. Int’l Riding Helmets, Ltd., 49 F.3d 692, 694 (11th Cir.1995), but that is not the situation here. Briefly, as to Mr. Parker’s specific factual attacks, he argues that Ms. Jacobs falsely argued that Mr. Parker had been practicing law in the bankruptcy court since 2005; however, contrary to Mr. Parker’s assertion, the bankruptcy judge did not adopt that fact. (See Order 2, April 8, 2011 (reciting that Mr. Parker “has been practicing law in this Court for more than two years and has filed dozens of cases”).) Moreover, the evidence of a “high rate of [ajmendments” made in Mr. Parker’s cases amplified the number of cases in which Mr. Parker initially falsified the debtors’ counties of residence. (Order 2, April 8, 2011.) That evidence was maté-rial to the misconduct relied upon by the bankruptcy judge in sanctioning Mr. Parker. Evidence that a lawyer has knowingly made false statements in petitions and other papers for fraudulent purposes is evidence of incompetence. Mr. Parker’s competence was squarely at issue, and Mr. Parker’s contrary argument is rejected.
Continuing his attack on the evidence, Mr. Parker contends that the bankruptcy judge abused his discretion in finding that he (Mr. Parker) “had mishandled client funds.” (Appellant’s Br. 9.) The governing rules require that payment of the full filing fee (or, as prescribed, payment of a partial filing fee) must be made contemporaneously with the filing of a bankruptcy petition. See
Finally, Mr. Parker cites no authority for his argument that, because he was subjected to a temporary suspension sanction in the Porterfield case, the bankruptcy judge could not weigh that misconduct in fashioning the present permanent disbarment sanction. Mr. Parker’s argument sounds in double jeopardy, but, in sufficiently analogous circumstances, the Eighth Circuit held that disbarment did not violate the Double Jeopardy Clause, even though based on the same conduct that resulted in prior sanctions under
V. CONCLUSION
Although permanent disbarment from practicing law in the United States Bankruptcy Court in the Middle District of Alabama is a harsh sanction, the bankruptcy judge acted well within his discretion to impose this sanction. The bankruptcy judge did not abuse his discretion in finding that Mr. Parker repeatedly violated
For the foregoing reasons, the bankruptcy court’s Order denying Mr. Parker’s motion to vacate, entered on June 2, 2011, and the Order entered on April 8, 2011, disbarring Mr. Parker from the practice of law in the United States Bankruptcy Court for the Middle District of Alabama, are AFFIRMED.
It is further ORDERED that Mr. Parker’s request for oral argument is DENIED.
Notes
. The bankruptcy judge presiding over this miscellaneous proceeding was Judge William R. Sawyer.
. The temporary suspension, ending on or about June 27, 2011, prohibited only new filings by Mr. Parker. The bankruptcy court directed Mr. Parker to “continue to represent his clients in cases filed prior to the effective date of the injunction.” (Order 1, Porterfield Case.)
. The bankruptcy judge also ordered the Chapter 13 Trustee “to cease all further distributions of attorney’s fees to [Mr.] Parker until further order of this Court,” and ordered Ms. Jacobs “to use her best efforts to identify any pending bankruptcy cases in which Parker is counsel and take all reasonable action to protect the rights of former clients of Parker.” (Order 6, April 8, 2011.) On appeal, Mr. Parker does not contest the imposition of these two sanctions.
. For instance, Mr. Parker stated that he had been unaware until recently of the significant changes to bankruptcy law that occurred in 2005 as a result of the Bankruptcy Abuse Prevention and Consumer Protection Act. (H’rg Tr. 6, June 1, 2011.)
. Disbarment generally is regarded as a civil penalty. See Ex parte Wall, 107 U.S. 265, 288, 2 S.Ct. 569, 27 L.Ed. 552 (1883) (“The [disbarment] proceeding is not for the purpose of punishment, but for the purpose of preserving the courts of justice from the official ministration of persons unfit to practise in them.”); In re Sacher, 206 F.2d 358, 360 (2d Cir.1953) (“The purpose of striking an attorney from the rolls of a court is not to punish him but to protect the court itself and relieve the public of a member of the legal profession, who is unfit to serve as such, in order to maintain the respect due the court by
. Mr. Parker does not dispute that he received notice of the hearing and an opportunity to be heard on Ms. Jacobs‘s motion for sanctions. He also does not dispute that, prior to the hearing, he failed to inform the bankruptcy court that he would be unable to attend the hearing due to illness.
. In fact, at the June 1, 2011 hearing held on his motion to vacate, Mr. Parker did not challenge any of the bankruptcy court‘s factual findings detailed in the April 8, 2011 Order. The consequences of that failure are discussed more below.
. For this reason, Mr. Parker‘s argument that he was disbarred for missing a hearing when other attorneys who missed hearings were not disbarred lacks any relevance or persuasiveness.
. In the statement of facts in his brief, Mr. Parker states, without elaboration, that the bankruptcy judge’s sanction of disbarment “also mean[s] that [he] [is] prevented from the practice of ... law in any jurisdiction due to reciprocal discipline under Alabama Rules of Disciplinary Procedure.” (Appellant‘s Br. 1 (presumably referencing Ala. Rules of Disciplinary Procedure R.2(c)).) Neither this court nor the bankruptcy court, however, has any control over whether state disciplinary authorities impose reciprocal discipline based upon Mr. Parker’s misconduct outlined in the bankruptcy judge‘s April 8, 2011 Order. Mr. Parker also cites no authority, and the court is aware of none, that the potential for reciprocal discipline is a factor a court should consider in fashioning an appropriate sanction.