Pro Hac Vice Appearance vs. “Consulting Lawyer” Status — Five-Factor Test for Determining When a Lawyer Is a Consulting Lawyer and Need Not Appear Pro Hac Vice in Federal Court

 

Gsell v. Rubin & Yates, LLC, 2014 U.S. Dist. LEXIS 123937 (E.D. Pa. Sept. 4, 2014):

This case raises the question of whether a lawyer [Mr. Lee], who is not admitted to practice in the Eastern District of Pennsylvania ("E.D. Pa."), generally or pro hac vice, may recover attorney's fees as a "consulting" attorney, under a fee-shifting statute, for work performed in a case in the E.D. Pa. in which his client was the prevailing party.

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II. RULES OF ADMISSION

a. Purpose of the Rules

The Court has a duty to maintain the integrity of proceedings and the confidence of the public. These obligations cannot be upheld without a means of restricting admission to practice to individuals who are familiar with and are committed to the ethical and procedural standards required of officers of the Court. See Tolchin v. Supreme Court of N.J., 111 F.3d 1099, 1110-11 (1997) (upholding a New Jersey state rule mandating that attorneys practicing in the state maintain a "bona fide" office, noting that state courts "have a substantial interest in assuring the availability of and overseeing attorneys practicing within their borders"); see also Leis v. Flynt, 439 U.S. 438, 445 n. 5, 99 S. Ct. 698, 58 L. Ed. 2d 717 (1979) (recognizing, in a case upholding a state court's right to restrict pro hac vice admission of out-of-state attorneys, the "traditional authority of state courts to control who may be admitted to practice before them"); Goldfarb v. Va. State Bar, 421 U.S. 773, 792, 95 S. Ct. 2004, 44 L. Ed. 2d 572 (1975) ("The interest of the States in regulating lawyers is especially great since lawyers are essential to the primary governmental function of administering justice, and have historically been 'officers of the courts.'").

Local rules of civil procedure, placing limitations on admission to practice within a [*7]  district, are enacted by a district court in accordance with its duty to ensure orderly administration of justice. See 28 U.S.C. § 2071 (providing rule-making authority to federal district courts). Accordingly, the E.D. Pa. has enacted rules of admission to the Court for both attorneys admitted to practice in Pennsylvania ("general" admission) and attorneys who are not admitted to practice in Pennsylvania but who wish to appear in a single proceeding ("pro hac vice" admission).

b. Admission to the Eastern District of Pennsylvania

The E.D. Pa.'s Local Rules of Civil Procedure specifically provide that an attorney may be admitted to practice before the District Court for the Eastern District of Pennsylvania, where that individual is a member of good standing of the bar for the Supreme Court of Pennsylvania, and upon motion of an existing member of the E.D. Pa. bar. See Local R. Civ. P. 83.5. Mr. Lee does not contend that he is a member of the Pennsylvania bar and therefore he is not eligible for general admission under this provision of the Local Rules.

c. Pro Hac Vice Admission to the Eastern District of Pennsylvania

Participation in litigation before the District Court by attorneys who are not admitted to practice in Pennsylvania4 or the E.D. Pa., is also specifically provided for in the E.D. Pa.'s Local Rules:

An attorney who is not a member of the bar of this Court shall not actively participate in the conduct of any trial or pre-trial or post-trial proceeding before this Court unless, upon motion of a member of the bar of this Court containing a verified application, leave to do so shall have been granted.

Local R. Civ. P. 83.5.2(b) (emphasis added).

4   The Pennsylvania Rules of Professional Conduct ("PRPC"), which govern admission to practice before the Pennsylvania Supreme Court, a pre-requisite for general admission to practice in the E.D. Pa., provides that "a lawyer admitted to another United States jurisdiction . . . may provide legal services on a temporary basis in this jurisdiction that are undertaken in association with a lawyer who is admitted to practice in this jurisdiction and who actively participates in the matter . . . ." PRPC 5.5(c). Thus, PRPC 5.5(c) appears to provide the same precondition for a non-admitted attorney to participate actively in a case within Pennsylvania as appears in the E.D. Pa.'s Local Rules: that such conduct may be done only as a close collaboration with a licensed Pennsylvania attorney.

Plaintiff [*9]  concedes that Mr. Lee has failed to obtain admission within the E.D. Pa., in either a general or pro hac vice capacity. However, Plaintiff asserts that compensation for Mr. Lee's work in the case is still appropriate, as his role was limited to that of a "consulting" attorney. Thus, the Court must decide whether Mr. Lee actively participated in the case, thus requiring pro hac vice admission, or whether he acted merely as a "consulting" attorney.

III. "ACTIVE" PARTICIPATION VERSUS "CONSULTING" ROLE

Bilazzo v. Portfolio Recovery Assocs., 876 F. Supp. 2d 452 (D.N.J. 2012), like the present case, involved a motion for attorney's fees for services rendered by purported "consulting" attorneys who performed most of the work on the case, but who were not admitted [*10]  to practice before the district court presiding over the case. The plaintiff in Bilazzo had obtained a local counsel of record who was admitted to practice before the district court and who was described as "lead counsel." Id. at 459. When the plaintiff moved for attorney's fees and costs, however, the vast majority of fees claimed were for the services of two out-of-state "consulting" Krohn & Moss attorneys and not for the local "lead" counsel. The Bilazzo court recognized that a "reasonable fee" might be recovered "for time spent by individuals what are not members of the bar, but whose work product contributed to the results obtained in th[e] case," including legal consultants, as well as other support staff. Id. at 461. The court then needed to determine whether the services rendered by a non-admitted attorney in that case could be considered the work of a "consulting" attorney, as allowed under the local rules of admission, and thus eligible for recovery.

In Bilazzo, Judge Hillman applied a five-factor test to decide whether the out-of-state attorneys had acted in a permissible "consulting" role, or had actively participated in the case in violation of the local rules. See id. at 464. Generally, a non-admitted attorney performs the role of "consulting" attorney when the attorney:

   (1) refrains from direct contact with the client . . . ;

   (2) refrains from any significant contact with opposing counsel . . . ;

   (3) does not sign pleadings or motions filed with the court, and does not draft a substantial portion of the pleadings--specifically the complaint;

   (4) engages almost exclusively in activities such as reviewing motions, preparing memos, editing documents, discussing [*12]  litigation strategy with lead counsel, conducting legal research, and the like; and

   (5) records only a modest number of hours during the course of litigation as compared to that of lead counsel and other attorneys admitted to practice in the relevant jurisdiction.

Id. at 464.

Applying these factors, Judge Hillman concluded that the nature of work done by the out-of state attorneys "far exceeded" the type of conduct permitted by non-admitted "consulting" attorneys, and therefore that the out-of-state attorneys had violated the District of New Jersey's Local Rule 101.1(c). Specifically, the court noted that the out-of-state attorneys incurred 81% of the billable hours incurred, compared to local counsel's 19%, id. at 465, that the out-of-state attorneys "engaged in substantial and direct contact with the client, through client consults, interviews and correspondence," id. at 467, that they "engaged in significant contact with opposing counsel," including presentation of a pre-suit demand, id., and that they drafted significant filings, including the complaint, id.

After finding that the out-of-state attorneys had actually served as lead counsel, rather than in a "consulting" role, the district court in Bilazzo reduced the attorney's fees [*13]  granted to the FDCPA plaintiff, as a sanction for the attorneys' failure to obtain pro hac vice admission. Fees were not denied entirely, based on the court's concern for the mandatory nature of a fee award under FDCPA § 1692k(a)(3), as well as the fact that it found insufficient evidence to warrant a finding that counsel had purposefully violated the applicable local rules. Bilazzo, 876 F. Supp. 2d at 468. However, the court also noted that the particular attorneys involved (from Krohn & Moss, the law firm also involved in this case) were on notice of their obligation to obtain pro hac vice admission in the future. Id. at 468 n. 10.

Other courts, outside the Third Circuit, have also addressed when a non-admitted "consulting" attorney may be entitled to recover attorney's fees. For instance, in Winterrowd v. American General Annuity Ins., 556 F.3d 815 (9th Cir. 2009), the Ninth Circuit considered whether an out-of-state attorney who provided assistance to lead counsel could recover attorney's fees, despite his failure to obtain pro hac vice admission. There, plaintiffs in an action raised in the Central District of California sought attorney's fees in part for work completed by an Oregon attorney who was not admitted to practice in California or before the Central District of California. This out-of-state attorney's role [*14]  was limited to "advising [California lead counsel]," "reviewing pleadings," and "minimal, nonexclusive contact with the client." Winterrowd, 556 F.3d at 823-24. The Ninth Circuit found relevant that the out-of-state attorney had remained within a permissible "litigation support" or consulting capacity because these limited contributions to the case "did not rise to the level of 'appearing' before the district court," and thus his fees were recoverable. Id. at 824.

The Ninth Circuit reasoned that recovery for an out-of-state consultant's services was no different than recovery for the work of paralegals, database managers, legal support, summer associates, and even attorneys who have yet to pass the bar. Id. at 823 (citing Dietrich Corp. v. King Resources, Co., 596 F.2d 422, 426 (10th Cir. 1979); Spanos v. Skouras Theatres Corp., 364 F.2d 161, 169 (2d Cir. 1966)). In all of these circumstances, the fees are still recoverable on the theory that an admitted attorney has "vouched" for the work of the supporting actors and "acted as a filter" between the supporting contributors and the court. Winterrowd, 556 F.3d at 824-25 (citing Dietrich, 596 F.2d at 426).

In Spanos v. Skouras Theatres Corp., a suit between a legal consultant and a former client regarding the apportionment of an attorney's fees award, the Second Circuit noted the distinction between an out-of-state "consulting" attorney, for whom recovery for legal services might [*15]  be allowable without admission to the local bar, and a non-admitted attorney acting as lead counsel. Spanos, 364 F.2d at 165. The court suggested that perhaps this "consulting" role was defined by the degree of supervision from lead counsel and direct interaction with a client. Id. at 165, 167. The Second Circuit found that the non-admitted attorney in that case was not a mere consultant, as he "was not operating under the supervision or control of the other [admitted] attorneys." Id. at 167. Accordingly, the Second Circuit held that the non-admitted attorney was obligated to obtain pro hac vice admission to practice before the district court; due to his failure to obtain such admission, the Second Circuit reversed the award of attorney's fees to this attorney. Id.

More recently, in Krapf v. Nationwide Credit Inc., the Central District of California considered whether attorney's fees could be awarded for the work of an out-of-state attorney who was not admitted pro hac vice, but whose contribution to a pending case was purportedly limited to "litigation support." Civ. No. 09-00711, 2010 U.S. Dist. LEXIS 116689, 2010 WL 4261444 at *2 (C.D. Cal. Oct. 21, 2010). The district court found that the out-of-state attorney had maintained a consulting role, as he "recorded a modest number of hours compared with [in-state counsel]," he [*16]  did not have contact with the plaintiff client or opposing counsel, his work product was "filtered through" local counsel, and his role was limited to "reviewing motions, preparing memos, and discussing trial strategy with [local] counsel." 2010 U.S. Dist. LEXIS 116689, [WL] at *3. Because the out-of-state attorney's role was that of a consultant and did not rise to the level of an "appearance," the court found that the attorney was not required to obtain pro hac vice admission, and that the cost of his services was recoverable as part of an award for attorney's fees. Id.

From the various decisions considering whether an out-of-state attorney occupied the sort of "consulting" role that would allow for an award of attorney's fees despite the attorney's failure to seek pro hace vice admission in the local court, a consistent list of relevant factors emerges. The weight that each factor commands necessarily depends on the facts of the underlying case.

Where an out-of-state attorney's participation was limited to that of a consultant whose services are compensable despite lack of pro hac vice admission, that attorney likely:

(1) refrained from direct client contact, see Bilazzo, 876 F. Supp. 2d at 464, 466; Winterrowd, 556 F.3d at 824; Spanos, 364 F.2d at 165; Krapf, 2010 U.S. Dist. LEXIS 116689, 2010 WL 4261444 at *3;

(2) refrained from contact with opposing counsel, see Bilazzo, 876 F. Supp. 2d at 464; Winterrowd, 556 F.3d at 824;

(3) did not sign or draft substantial portions of pleadings, especially the complaint, see Bilazzo, 876 F. Supp. 2d at 464; Winterrowd, 556 F.3d at 824; Krapf, 2010 U.S. Dist. LEXIS 116689, 2010 WL 4261444 at *3;

(4) restricted his participation in the case to reviewing motions, drafting internal memos, and advising lead counsel, such that his work was supervised by, and ultimately "filtered" through the lead attorney, Bilazzo, 876 F. Supp. 2d at 464-65; Winterrowd, 556 F.3d at 824; Dietrich, 596 F.3d at 426; Spanos, 364 F.2d at 165; Krapf, 2010 U.S. Dist. LEXIS 116689, 2010 WL 4261444 at *3;

(5) recorded only a modest number of hours on a case, relative to lead counsel and other admitted attorneys working on a case, see Bilazzo, 876 F. Supp. 2d at 464-65; Krapf, 2010 U.S. Dist. LEXIS 116689, 2010 WL 4261444 at *3.

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