Commercial Litigation and Arbitration

Sanctions — Power to Disbar Should be Exercised with Great Caution

Parker v. Jacobs (In re Parker), 2012 U.S. App. LEXIS 16552 (11th Cir. Aug. 9, 2012):

On February 17, 2011, Teresa Jacobs, the bankruptcy administrator for the Middle District of Alabama, moved for the bankruptcy court to impose sanctions on Parker. Jacobs alleged that, over the course of several cases, Parker committed numerous violations of Federal Rule of Bankruptcy Procedure 9011(b) and U.S.C. § 526(a)(5). In particular, Jacobs alleged that Parker filed six Chapter 7 petitions in which he made false statements pertaining to the debtor's county of residence. She also pointed the court to twenty-eight cases in which Parker failed to pay the filing fee for his client's case in a timely fashion, though in many of those cases the client had paid Parker for that fee. Last, she alleged that Parker's performance in his own Chapter 7 proceeding included false statements and incomplete disclosures. These infractions were, according to Jacobs, "indicative of a lack of the requisite diligence, knowledge and skill necessary for Parker to competently represent clients in bankruptcy." See Ala. Rules of Prof'l Conduct, Rule 1.1. As a result, she sought "appropriate sanctions . . . sufficient to deter repetition and continuation of such conduct."

The bankruptcy judge scheduled a hearing for April 7, 2011. Though Parker was provided notice of this hearing by email and first-class mail, he did not file a response to the motion for sanctions, failed to appear for the hearing, and failed to notify the bankruptcy judge prior to the hearing that he would be absent. After reviewing the voluminous evidence, the bankruptcy judge decided to disbar Parker from practicing in bankruptcy court. In his written order, the bankruptcy judge explained in detail how Parker "ha[d] made a practice of misappropriating client funds and intentionally making false statements in his own and his clients' bankruptcy petitions." These "violations of attorney ethics," the bankruptcy judge concluded, were "so widespread" that "the only appropriate sanction [was] disbarment." ***

Though we recognize that the power to disbar "is one that ought always to be exercised with great caution," Schlumberger Techs., Inc. v. Wiley, 113 F.3d 1553, 1562 (11th Cir. 1997) (quotation marks omitted), Parker has not demonstrated that the bankruptcy court abused its discretion in exercising that power with respect to him. To the contrary, our review reveals that the bankruptcy court did not err in law and its findings are amply supported by the record. For these reasons, we affirm the district court's judgment.

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