In the Matter of Christopher John Palazzola
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Opinion
310 Ga. 634 FINAL COPY
S20Y1100. IN THE MATTER OF CHRISTOPHER JOHN PALAZZOLA.
PER CURIAM.
This disciplinary matter is back before this Court on the report
and recommendation of the State Disciplinary Review Board, which
reviewed the report and recommendation issued by Special Master
S. Jeffrey Rusbridge at the request of the respondent attorney,
Christopher John Palazzola (State Bar No. 559321), pursuant to Bar
Rule 4-216 (d).1 While the Special Master recommends a six-month
suspension with conditions on reinstatement, the Review Board
1 After two of Palazzola’s former associates filed a grievance against him
in October 2012, the State Bar initiated this matter in 2014 by filing a Formal Complaint. Palazzola filed a petition for voluntary discipline requesting a Review Panel (now called Review Board) reprimand for violating Rules 1.4, 7.1, and 8.4 (a) (4) of the Georgia Rules of Professional Conduct. The Special Master rejected the petition in 2015 for failing to contain sufficient information about the admissions of fact and admissions of misconduct. Palazzola’s second petition for voluntary discipline, in which he again requested a Review Panel reprimand, this time for violating Rules 1.16 (d), 5.3, 7.1, and 8.4 (a) (4), was supported by the Special Master and not opposed by the State Bar. But this Court rejected the petition in 2017, concluding that “a reprimand is inadequate under these circumstances, particularly given the number of rules violations.” In the Matter of Palazzola, 300 Ga. 785, 789 (798 SE2d 212) (2017). recommends that Palazzola, who has been a member of the Bar since
1999, be suspended from the practice of law for a period of three
months without conditions for violating Rules 1.16 (d), 5.3, 7.1, and
8.4 (a) (4) of the Georgia Rules of Professional Conduct found in Bar
Rule 4-102. After the matter returned to this Court, Palazzola filed
motions demonstrating that he voluntarily stopped practicing law
by June 1, 2020, and otherwise satisfied the requirements for any
suspension that we impose to begin nunc pro tunc on that date. See
In the Matter of Onipede, 288 Ga. 156, 157 (702 SE2d 136) (2010).
The misconduct at issue involves dealings by Palazzola or his
law firm’s staff with three clients who were seeking to contact or
were represented by a former associate who had left the firm; his
law firm’s false and misleading advertisements; and his dishonest
failure to establish and contribute to two of his associates’
retirement accounts as promised. In recommending a shorter
suspension, the Review Board disagreed with the Special Master
only about whether Palazzola’s dishonesty regarding the retirement
accounts constituted “professional conduct” within the meaning of
2 Rule 8.4 (a) (4). What sorts of deceptive conduct by a lawyer
involving the management of his law office can violate Rule 8.4 (a)
(4) is an unsettled and difficult question, and because we would not
impose a suspension exceeding the time that Palazzola has already
voluntarily stopped practicing law whichever way we decided the
retirement account question, we need not resolve that question in
this case. Instead, for the reasons discussed below, we suspend
Palazzola from the practice of law nunc pro tunc as of June 1, 2020,
a suspension from which he is hereby reinstated with conditions
regarding law practice management to be met within six months of
this order.
1. The facts.
The pertinent facts as found by the Special Master in his report
are as follows.
(a) Dealings with clients. This matter arose from a grievance
filed with the State Bar by two of Palazzola’s former attorney
associates who left his law firm in October 2012. When one of the
former associates was employed by Palazzola’s law firm, she
3 represented a certain client. After the associate resigned from the
firm, the client contacted the firm on more than one occasion and
asked to speak to the former associate, but was told that she was
unavailable. Palazzola’s staff did not tell the client that his lawyer
had left the firm. On a later occasion, the client was told by staff
that the former associate had left the law firm, but despite knowing
her new address and telephone number, staff told the client that
such information could not be provided to him.
In addition, Palazzola’s staff knew that a second client had
chosen to continue to be represented by the same former associate
after she left the law firm; that subsequently, the United States
Citizenship and Immigration Service (“USCIS”) sent official
correspondence regarding the second client’s case to the former
associate at Palazzola’s office; and that although his staff opened the
envelope containing the correspondence, they did not notify either
the former associate or the second client of the receipt of the
correspondence and instead returned it to the USCIS.
Finally, Palazzola knew that a third client had chosen to
4 continue to be represented by the same former associate after she
left his law firm, and although the former associate asked Palazzola
to forward the client’s file to her, he failed to do so for weeks.
(b) Advertisements. Palazzola paid for weekly Spanish-
language print advertisements for his law firm in Mundo Hispanico
for various periods in 2011, 2012, and 2013. Each of these
advertisements included the same photograph of the same five
individuals, one of whom was Palazzola, in front of a bookcase
containing what appeared to be law books, and stated (as translated
into English), “More than 100 years of experience in the following
legal areas,” followed by a listing of approximately 17 areas of
practice. Palazzola knew that on the dates of publication of the
advertisements, one or more of the individuals in the photograph
was not a member of or employed by his law firm.
Moreover, Palazzola knew that at the time the advertisements
were published, he personally did not have 100 years of practice
experience in any practice area, as he had only about 13 years of
5 experience as a practicing lawyer in 2012.2 Palazzola stated in his
answer to the Formal Complaint that he had been under the
impression that the advertisements would say that the firm and its
associates had combined experience of over 100 years. But he also
stated that during most of 2012, the only other lawyers in his firm
were the two associates previously mentioned, one of whom then had
about one year of experience as a licensed lawyer and the other of
whom had four. Thus, Palazzola knew at the time the
advertisements were published that the statement claiming 100
years of experience in the listed practice areas was false as to every
practice area and would have been false even if the statement had
explicitly referenced the firm’s combined experience, as there was
no evidence that the combined experience of the lawyers in his firm
was more than 18 years as of 2012.
In addition, one of the advertisements stated under the law
firm’s Internet address, “Atlanta · Miami · Los Angeles” — but
2 Although the advertisements also were published during parts of 2011
and 2013, the Special Master focused on 2012, which was the bulk of the time that the advertisements ran. 6 Palazzola had no office in Miami or Los Angeles. Palazzola indicated
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310 Ga. 634 FINAL COPY
S20Y1100. IN THE MATTER OF CHRISTOPHER JOHN PALAZZOLA.
PER CURIAM.
This disciplinary matter is back before this Court on the report
and recommendation of the State Disciplinary Review Board, which
reviewed the report and recommendation issued by Special Master
S. Jeffrey Rusbridge at the request of the respondent attorney,
Christopher John Palazzola (State Bar No. 559321), pursuant to Bar
Rule 4-216 (d).1 While the Special Master recommends a six-month
suspension with conditions on reinstatement, the Review Board
1 After two of Palazzola’s former associates filed a grievance against him
in October 2012, the State Bar initiated this matter in 2014 by filing a Formal Complaint. Palazzola filed a petition for voluntary discipline requesting a Review Panel (now called Review Board) reprimand for violating Rules 1.4, 7.1, and 8.4 (a) (4) of the Georgia Rules of Professional Conduct. The Special Master rejected the petition in 2015 for failing to contain sufficient information about the admissions of fact and admissions of misconduct. Palazzola’s second petition for voluntary discipline, in which he again requested a Review Panel reprimand, this time for violating Rules 1.16 (d), 5.3, 7.1, and 8.4 (a) (4), was supported by the Special Master and not opposed by the State Bar. But this Court rejected the petition in 2017, concluding that “a reprimand is inadequate under these circumstances, particularly given the number of rules violations.” In the Matter of Palazzola, 300 Ga. 785, 789 (798 SE2d 212) (2017). recommends that Palazzola, who has been a member of the Bar since
1999, be suspended from the practice of law for a period of three
months without conditions for violating Rules 1.16 (d), 5.3, 7.1, and
8.4 (a) (4) of the Georgia Rules of Professional Conduct found in Bar
Rule 4-102. After the matter returned to this Court, Palazzola filed
motions demonstrating that he voluntarily stopped practicing law
by June 1, 2020, and otherwise satisfied the requirements for any
suspension that we impose to begin nunc pro tunc on that date. See
In the Matter of Onipede, 288 Ga. 156, 157 (702 SE2d 136) (2010).
The misconduct at issue involves dealings by Palazzola or his
law firm’s staff with three clients who were seeking to contact or
were represented by a former associate who had left the firm; his
law firm’s false and misleading advertisements; and his dishonest
failure to establish and contribute to two of his associates’
retirement accounts as promised. In recommending a shorter
suspension, the Review Board disagreed with the Special Master
only about whether Palazzola’s dishonesty regarding the retirement
accounts constituted “professional conduct” within the meaning of
2 Rule 8.4 (a) (4). What sorts of deceptive conduct by a lawyer
involving the management of his law office can violate Rule 8.4 (a)
(4) is an unsettled and difficult question, and because we would not
impose a suspension exceeding the time that Palazzola has already
voluntarily stopped practicing law whichever way we decided the
retirement account question, we need not resolve that question in
this case. Instead, for the reasons discussed below, we suspend
Palazzola from the practice of law nunc pro tunc as of June 1, 2020,
a suspension from which he is hereby reinstated with conditions
regarding law practice management to be met within six months of
this order.
1. The facts.
The pertinent facts as found by the Special Master in his report
are as follows.
(a) Dealings with clients. This matter arose from a grievance
filed with the State Bar by two of Palazzola’s former attorney
associates who left his law firm in October 2012. When one of the
former associates was employed by Palazzola’s law firm, she
3 represented a certain client. After the associate resigned from the
firm, the client contacted the firm on more than one occasion and
asked to speak to the former associate, but was told that she was
unavailable. Palazzola’s staff did not tell the client that his lawyer
had left the firm. On a later occasion, the client was told by staff
that the former associate had left the law firm, but despite knowing
her new address and telephone number, staff told the client that
such information could not be provided to him.
In addition, Palazzola’s staff knew that a second client had
chosen to continue to be represented by the same former associate
after she left the law firm; that subsequently, the United States
Citizenship and Immigration Service (“USCIS”) sent official
correspondence regarding the second client’s case to the former
associate at Palazzola’s office; and that although his staff opened the
envelope containing the correspondence, they did not notify either
the former associate or the second client of the receipt of the
correspondence and instead returned it to the USCIS.
Finally, Palazzola knew that a third client had chosen to
4 continue to be represented by the same former associate after she
left his law firm, and although the former associate asked Palazzola
to forward the client’s file to her, he failed to do so for weeks.
(b) Advertisements. Palazzola paid for weekly Spanish-
language print advertisements for his law firm in Mundo Hispanico
for various periods in 2011, 2012, and 2013. Each of these
advertisements included the same photograph of the same five
individuals, one of whom was Palazzola, in front of a bookcase
containing what appeared to be law books, and stated (as translated
into English), “More than 100 years of experience in the following
legal areas,” followed by a listing of approximately 17 areas of
practice. Palazzola knew that on the dates of publication of the
advertisements, one or more of the individuals in the photograph
was not a member of or employed by his law firm.
Moreover, Palazzola knew that at the time the advertisements
were published, he personally did not have 100 years of practice
experience in any practice area, as he had only about 13 years of
5 experience as a practicing lawyer in 2012.2 Palazzola stated in his
answer to the Formal Complaint that he had been under the
impression that the advertisements would say that the firm and its
associates had combined experience of over 100 years. But he also
stated that during most of 2012, the only other lawyers in his firm
were the two associates previously mentioned, one of whom then had
about one year of experience as a licensed lawyer and the other of
whom had four. Thus, Palazzola knew at the time the
advertisements were published that the statement claiming 100
years of experience in the listed practice areas was false as to every
practice area and would have been false even if the statement had
explicitly referenced the firm’s combined experience, as there was
no evidence that the combined experience of the lawyers in his firm
was more than 18 years as of 2012.
In addition, one of the advertisements stated under the law
firm’s Internet address, “Atlanta · Miami · Los Angeles” — but
2 Although the advertisements also were published during parts of 2011
and 2013, the Special Master focused on 2012, which was the bulk of the time that the advertisements ran. 6 Palazzola had no office in Miami or Los Angeles. Palazzola indicated
to the Special Master that he had listed Miami and Los Angeles in
the advertisement based on his “of counsel” relationship with
another law firm, which was not stated in the advertisement.
Moreover, the law firm with which Palazzola had an “of counsel”
relationship also did not have offices in Florida or California,
indicating on its own letterhead only that it had “of counsel”
relationships with two other firms located in Florida and California.
(c) Retirement accounts. Palazzola promised the two attorney
associates mentioned above that he would set up retirement
accounts for them and that his law firm would match their
respective contributions up to a certain percentage of salary.
Palazzola then caused the retirement account contributions to be
withheld from their salaries according to their elections, and noted
as much on the pay stubs of their paychecks for each pay period. For
each pay period, Palazzola, in his capacity as the owner of his law
firm, received from the payroll service he used for the firm a check
that included the amount of the associates’ supposed retirement
7 account withholdings. However, Palazzola did not actually establish
the retirement accounts or match his associates’ contributions
during the several months of the associates’ employment; instead,
he placed their contributions in a non-interest bearing law firm
account.
After resigning from the law firm in 2012, the associates filed
complaints against Palazzola with the United States Department of
Labor, which during the course of its investigation established the
amount that he owed to each of the associates, including interest.
In 2014, Palazzola paid each former associate the full respective
amounts owed, including interest, and admitted that he should have
done so sooner, as both associates had resigned from his law firm
two years earlier.3
3 The Special Master did not make a finding regarding the amount of
money that Palazzola failed to pay into the retirement accounts. The record in his second petition for voluntary discipline includes a letter from the Labor Department to Palazzola stating that after examining his law firm’s bank records, the department had determined that he failed to forward employee contributions of $1,128.56 and employer contributions of the same amount on behalf of the two associates.
8 2. The Special Master’s conclusions of law.
The Special Master reached the following conclusions of law in
his report.
(a) Dealings with clients. The Special Master concluded that
Palazzola violated Rule 1.16 (d)4 when he failed to promptly provide
the third client’s file to his former associate. See In the Matter of
Hooks, 292 Ga. 781, 782 (741 SE2d 645) (2013) (attorney’s failure to
supply a client file to replacement counsel is a violation of Rule 1.16
(d)). The Special Master noted that Comment 9 to Rule 1.16 says,
“[e]ven if the lawyer has been unfairly discharged by the client, a
lawyer must take all reasonable steps to mitigate the consequences
to the client,” and that even where an attorney has not been paid by
a client, it is improper to withhold the client’s file. See State Bar of
4 Rule 1.16 (d) says:
Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client’s interests, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled and refunding any advance payment of fee that has not been earned. The maximum sanction for a violation of Rule 1.16 (d) is a public reprimand.
9 Georgia, Formal Advisory Op. No. 87.5 (Sept. 26, 1988).
The Special Master also concluded that Palazzola violated Rule
5.35 when he failed to properly supervise or instruct his staff so that
they would act in accordance with his professional obligations.
Specifically, the Special Master held that when Palazzola’s staff
failed to tell the first client that the former associate handling his
matter had left the firm and told him that they could not provide
contact information for her, their actions deviated from Rule 1.4 (a)
(3) and (4), which respectively require a lawyer to keep his client
reasonably informed about the status of a matter and to promptly
comply with reasonable requests for information. Likewise, when
Palazzola’s staff received official correspondence in the second
5 Rule 5.3 says in pertinent part that, “[w]ith respect to a nonlawyer
employed or retained by or associated with a lawyer”: (a) a partner, and a lawyer who individually or together with other lawyers possesses managerial authority in a law firm, shall make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that the person’s conduct is compatible with the professional obligations of the lawyer; (b) a lawyer having direct supervisory authority over the nonlawyer shall make reasonable efforts to ensure that the person’s conduct is compatible with the professional obligations of the lawyer[.] The maximum sanction for a violation of this rule is disbarment. 10 client’s case that they failed to forward to either the client or his new
attorney (the former associate), they again acted contrary to the
requirements of Rule 1.4 (a) (3), and this conduct also violated Rule
1.16 (d).
Finally, the Special Master noted Comment 2 to Rule 5.3,
which says in pertinent part:
Paragraph (a) [of the rule] requires lawyers with managerial authority within a law firm to make reasonable efforts to establish internal policies and procedures designed to provide reasonable assurance that nonlawyers in the firm will act in a way compatible with the Georgia Rules of Professional Conduct. See Comment [1] to Rule 5.1. Paragraph (b) applies to lawyers who have supervisory authority over the work of a nonlawyer. . . .
The Special Master held that Palazzola failed to meet this
requirement and that his staff had not been properly prepared to
meet his professional obligations in relation to these clients.
(b) Advertisements. The Special Master concluded that
Palazzola violated Rule 7.1 (a) (1)6 when for various periods in 2011,
6 Rule 7.1 (a) (1) says:
A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. By way of illustration,
11 2012, and 2013, he published advertisements in Mundo Hispanico
that contained multiple material misrepresentations of fact and
omissions of fact necessary to make the statements considered as a
whole not materially misleading. Specifically, the Special Master
held that the photographs of individuals in front of a bookcase
containing what appeared to be law books necessarily
communicated to any reasonable reader that all the pictured
individuals were part of Palazzola’s law firm, which was not the
case, and that regardless of whether they were direct material
misrepresentations of fact or materially misleading by omission, the
advertisements violated Rule 7.1 (a) (1). The Special Master further
held that the statement “[m]ore than 100 years of experience” in 17
areas of practice vastly and unreasonably exaggerated Palazzola’s
and his associates’ actual total legal experience, such that these
advertisements violated Rule 7.1 (a) (1). The Special Master held
but not limitation, a communication is false or misleading if it . . . contains a material misrepresentation of fact or law or omits a fact necessary to make the statement considered as a whole not materially misleading[.] The maximum sanction for a violation of this rule is disbarment. 12 that Palazzola also violated Rule 7.1 (a) (1) by listing “Atlanta ·
Miami · Los Angeles” in one of the advertisements because it
communicated to a reasonable reader that he had law offices in all
three cities, which was materially false.
In addition, the Special Master concluded that Palazzola
violated Rule 8.4 (a) (4),7 as each instance of Palazzola’s false and
misleading advertising was an instance of professional conduct
involving dishonesty, fraud, deceit, and misrepresentation.
(c) Retirement accounts. Finally, the Special Master concluded
that Palazzola also violated Rule 8.4 (a) (4) in connection with the
retirement benefits that he promised his two associates as part of
their compensation. Palazzola caused retirement contributions to
be withheld from the associates’ salaries, which were noted as such
on the pay stubs of their paychecks, and he received checks that
included the amount of the withheld retirement contributions from
7 Rule 8.4 (a) (4) says: “It shall be a violation of the Georgia Rules of
Professional Conduct for a lawyer to . . . engage in professional conduct involving dishonesty, fraud, deceit or misrepresentation[.]” The maximum sanction for a violation of Rule 8.4 (a) (4) is disbarment. 13 the payroll service that he used for his firm. However, Palazzola
never set up a retirement account during the several months of the
associates’ employment, nor did he pay the withheld earnings or his
firm’s matching contributions to a retirement plan. Instead, their
contributions were placed in a non-interest-bearing law firm
account. The associates had to establish their rights to the promised
retirement funds by filing a complaint against Palazzola with the
United States Department of Labor. The Special Master concluded
that this conduct was “intended or likely to mislead another” in
violation of Rule 8.4 (a) (4), quoting In the Matter of West, 301 Ga.
901, 904 (804 SE2d 340) (2017).
3. The Special Master’s recommendation of discipline.
The Special Master looked to the ABA Standards for Imposing
Lawyer Sanctions for guidance in determining the appropriate
punishment for Palazzola’s misconduct. See In the Matter of Morse,
266 Ga. 652, 653 (470 SE2d 232) (1996). The Special Master
explained that because Palazzola’s conduct in regard to his
violations of Rules 1.16 (d), 7.1 (a) (1) and 8.4 (a) (4) was shown to
14 be knowing and because the violations could have caused injury to
clients, the public, or the legal system, a suspension was an
appropriate sanction. See ABA Standard 7.2. The Special Master
noted that ABA Standard 7.3 states that a “[r]eprimand is generally
appropriate when a lawyer negligently engages in conduct that is a
violation of a duty owed as a professional and causes injury or
potential injury to a client, the public, or the legal system,” and that
Palazzola’s violations of Rule 5.3 were shown to be negligent, as he
admitted that he failed to adequately ensure that his staff acted
compatibly with his professional obligations in their relations with
a client and with a former client.
With regard to mitigating factors, the Special Master found
that Palazzola had no prior disciplinary history, see ABA Standard
9.32 (a); that he made full restitution of the amounts found to be
owed by the United States Department of Labor (although the
Special Master found the weight of this factor attenuated by his
delay in payment), see ABA Standard 9.32 (d); and that he was
remorseful, as evidenced by his petitions for voluntary discipline,
15 see ABA Standard 9.32 (l). With regard to aggravating factors, the
Special Master found that Palazzola engaged in a pattern of
misconduct, as his violations of Rules 1.16 (d) and 5.3 affected
multiple clients, see ABA Standard 9.22 (c); that there were multiple
offenses, see ABA Standard 9.22 (d); and that he had substantial
experience in the practice of law, see ABA Standard 9.22 (i).
Considering all of the facts and circumstances of the violations
of the Georgia Rules of Professional Conduct, and the ABA
Standards, the Special Master recommended that this Court impose
on Palazzola a suspension from the practice of law for six months,
with reinstatement conditioned upon his completion of an
assessment of his law practice, as directed by the State Bar’s Law
Practice Management Program, and his providing a certificate of
compliance with any recommendation resulting therefrom by the
director of the program. The Special Master did not cite any of this
Court’s disciplinary cases as precedent for his recommendation.
4. Palazzola’s exception to the Special Master’s report.
Palazzola filed an exception to the Special Master’s report,
16 arguing that a public reprimand was the appropriate level of
discipline; he cited no precedent to support that argument. The
State Bar filed a response, noting that Palazzola offered no factual
or legal challenges to the Special Master’s report and arguing that
his requested discipline was inappropriate because this Court had
previously rejected his request for a reprimand. See footnote 1
above. The State Bar asserted that this Court regularly disbars
attorneys for making deliberate deceitful statements, citing two
cases involving misconduct not similar to this matter.8 The State
Bar also noted that this Court has imposed suspensions on attorneys
who, like Palazzola, committed multiple rule violations, citing
several cases involving mostly different types of rule violations than
the rules that Palazzola violated.9 In sum, the State Bar argued that
the Special Master’s recommended discipline was authorized by the
8 See In the Matter of McKenna, 282 Ga. 469, 470 (651 SE2d 80) (2007);
In the Matter of Shehane, 276 Ga. 168, 170 (575 SE2d 503) (2003). 9 See In the Matter of Lank, 300 Ga. 479, 482 (769 SE2d 252) (2017); In
the Matter of Huggins, 291 Ga. 92, 92-93 (727 SE2d 500) (2012); In the Matter of Terrell, 291 Ga. 91, 92 (727 SE2d 499) (2012); In the Matter of LeDoux, 288 Ga. 777, 778 (707 SE2d 88) (2001). 17 rules, supported by this Court’s cases, and not inappropriate given
Palazzola’s history of repeated, intentional falsehoods related to his
practice of law.
5. The Review Board’s report and recommendation.
The Review Board adopted the Special Master’s findings of fact
and approved the Special Master’s conclusions of law with one
significant exception. With respect to the retirement accounts, the
Special Master found that “[f]or each pay period, [Palazzola], in his
professional capacity as a lawyer operating a law firm with lawyer
employees, received from the payroll service he used for his firm a
check which included the amount of the [associates’ retirement
account] withholdings.” The Review Board held that whether
Palazzola was acting “in his professional capacity as a lawyer” with
regard to the retirement accounts was a question of law rather than
a finding of fact.10 And with regard to the Special Master’s
10 Despite this not-really-a-finding-of-fact holding, the Review Board “replace[d]” the Special Master’s finding with the following finding of fact: “For each pay period, [Palazzola] in his capacity as the owner of a law firm received from the payroll service he used for his law firm a check which included the amount of [the associates’ retirement account] withholdings.” 18 conclusion that Palazzola’s dishonesty and misrepresentations with
regard to his associates’ retirement accounts violated Rule 8.4 (a)
(4), the Review Board concluded that such conduct did not constitute
“professional conduct” within the meaning of that rule.
The Review Board noted that Rule 8.4 (a) (4) applies to a broad
range of conduct by a lawyer acting in his or her professional
capacity as a lawyer, including conduct related to clients, opposing
parties, and courts, citing In the Matter of Moore, 300 Ga. 407, 408-
409 (792 SE2d 324) (2016) (one-year suspension with conditions for
violating Rules 3.3, 4.1, and 8.4 (a) (4) where the lawyer failed to
serve the opposing party with pleadings, falsely stated in certificates
of service that he had done so, and misrepresented communications
with the opposing party); and In the Matter of Wright, 291 Ga. 841,
842-844 (732 SE2d 275) (2012) (public reprimand and six-month
suspension where the lawyer violated Rules 3.3 and 8.4 (a) (4) by
making false statements to the Court of Appeals and continued to
19 deny wrongdoing in the disciplinary proceedings).11
The Review Board then noted that this Court has specifically
considered the meaning of “professional conduct” in the context of
Rule 8.4 (a) (4) in only a few disciplinary cases, including In the
Matter of Brooks, 249 Ga. 556, 557-558 (292 SE2d 686) (1982), where
we held that the attorney’s “emphasis of and reliance on his
professional status and abilities” in purchasing a car for which he
failed to assume the seller’s loan, including in dissuading the seller
— who was not his client — from consulting a nearby attorney based
on his assurances that he was an attorney, amounted to
“professional conduct” within the meaning of Standard 4, which was
the former version of Rule 8.4 (a) (4); and In the Matter of Harrison,
255 Ga. 77, 78-79 (335 SE2d 564) (1985), where we concluded that
the attorney, who was appointed to act as the administrator of an
estate by a probate court judge who required all administrators to
retain counsel and who signed all pleadings of the estate for his law
11 The Review Board also cited In the Matter of Grant, 287 Ga. 131 (694
SE2d 647) (2010), but that disciplinary matter did not involve a Rule 8.4 (a) (4) violation. 20 firm, but failed to retain such counsel, and who the probate court
had held was acting in a dual capacity as attorney and
administrator, was acting in a professional capacity within the
meaning of Standard 4 when he misappropriated the estate’s funds.
The Review Board said that in both of those cases, the lawyers
“performed functions unique to the practice of law and abused their
status and expertise as a lawyer to steal funds and property.”
In this case, the Review Board held, there was no allegation
that in failing to set up the retirement accounts, Palazzola
misappropriated the funds, that he was acting in his role as a legal
representative for the employees, that he was presenting a matter
to a tribunal, or that he was otherwise acting in his capacity as a
lawyer. Thus, while the Review Board did not condone his failure to
set up the retirement accounts, it concluded that his conduct did not
constitute “professional conduct” within the meaning of Rule 8.4 (a)
(4).
The Review Board also expressed concern that a broad
application of Rule 8.4 (a) (4) could result in significant implications
21 for lawyers with regard to the management of their law firms,
including in disputes over employee benefits, hiring and firing
practices, and agreements with support personnel and vendors. The
Review Board pointed out that there are many remedies available
to resolve disputes with lawyers relating to business, employment,
and client matters outside of the disciplinary process. Finally, the
Review Board noted that Palazzola’s admission of a Rule 8.4 (a) (4)
violation relating to the retirement accounts was not binding, citing
a case in which this Court held that the facts admitted by an
attorney did not support the legal conclusion that he had violated
Rule 1.2 (d), even though he had admitted such a violation. See In
the Matter of West, 299 Ga. 731, 732 (791 SE2d 781) (2016).
The Review Board agreed with the Special Master’s
enumeration of factors in mitigation and aggravation of discipline.
As for the level of discipline to impose, the Review Board rejected
reliance on the cases that the State Bar cited in its response to
Palazzola’s exception, explaining that those cases involved more
serious abandonment of legal matters, misuse of trust accounts,
22 fabricating documents to deceive the State Bar, failing to account for
property, and failure to respond to disciplinary authorities, such
that they were not instructive on the facts of this case. The Review
Board concluded that while there were no disciplinary cases with
these precise facts, cases involving similar violations provided
guidance, citing In the Matter of Farnham, 300 Ga. 645, 645, 647
(797 SE2d 84) (2017) (public reprimand where the attorney violated
Rules 1.3, 1.16, and 5.3 and had previously been suspended
erroneously for more than one month); In the Matter of Saxton, 299
Ga. 742, 742-743 (791 SE2d 773) (2016) (three-month suspension for
violation of Rules 1.8 (h) and 5.3 (a) for a lawyer with two prior
disciplinary sanctions and multiple instances of misconduct); and In
the Matter of Adams, 287 Ga. 815, 815, 818-819 (700 SE2d 383)
(2010) (public reprimand with conditions for violations of Rules 1.3,
1.4, 1.16, 5.3, and 9.3 by a lawyer with a substance abuse problem
for which he was treated).
The Review Board ultimately recommended that Palazzola be
suspended from the practice of law for three months. The Review
23 Board explained that in making its recommendation, it had taken
into consideration the procedural history of this case, the position of
the State Bar voicing no objection to a Review Panel reprimand in
response to Palazzola’s second petition for voluntary discipline, and
this Court’s position that such a reprimand would be inappropriate
under these circumstances. See footnote 1 above. The Review Board
noted that there was no allegation that the clients’ cases were
harmed by the short delay in receiving the former associate’s contact
information and forwarding the one file to her, that this is
Palazzola’s first disciplinary violation, and that he had expressed
remorse. The Review Board also acknowledged Palazzola’s
willingness to bring this matter to a conclusion by petitioning twice
for voluntary discipline.12 The Review Board did not address the
Special Master’s recommendation that Palazzola’s reinstatement
from a suspension be conditioned on his compliance with the Law
12 We do not see this as a significant factor in Palazzola’s favor, as he
filed an exception requesting that the Review Board impose only a reprimand notwithstanding this Court’s unequivocal prior conclusion that “a reprimand is inadequate under these circumstances, particularly given the number of rules violations.” Palazzola, 300 Ga. at 789. 24 Practice Management Program’s recommendations for the
management of his law practice.
Neither party filed exceptions to the Review Board’s report and
recommendation.
6. Analysis.
(a) Imposition of a suspension with conditions. Putting aside
for the moment the question of whether Palazzola’s dishonest
conduct regarding his associates’ retirement accounts violated Rule
8.4 (a) (4), we agree (as the Review Board did) with the Special
Master’s findings of fact, conclusions of law, and enumeration of
applicable mitigating and aggravating circumstances. As indicated
by our previous rejection of Palazzola’s request for a reprimand, his
misconduct, which involved a variety of acts violating multiple
disciplinary rules, warrants a suspension from the practice of law.
Without a Rule 8.4 (a) (4) violation regarding the retirement
accounts, we would tend to agree with the Review Board that a
three-month suspension would be adequate, particularly as there
was no evidence that any client’s case was actually harmed, this is
25 the first disciplinary proceeding against Palazzola, and he has
expressed remorse. If Palazzola did violate Rule 8.4 (a) (4) as to his
associates and their retirement accounts, however, we might instead
agree with the Special Master’s recommendation of a six-month
suspension, although that would be the longest suspension we would
impose.
In either event, because some of Palazzola’s misconduct relates
to the management of his law practice and because he will be
entitled to operate his own law practice again upon completion of a
suspension, we agree with the Special Master that he should
complete an evaluation of his law practice by the State Bar’s Law
Practice Management Program and provide to the State Bar’s Office
of General Counsel a certificate of compliance with any
recommendations resulting therefrom by the director of the
program. Palazzola shall comply with these conditions within six
months of his reinstatement to the practice of law. See, e.g., Moore,
300 Ga. at 409; In the Matter of Smith Fitch, 298 Ga. 379, 381 (782
SE2d 40) (2016).
26 (b) Imposition of the suspension nunc pro tunc. In a motion
filed in this Court after the Review Board’s report was issued and
the matter returned here, Palazzola asked that we impose any
discipline nunc pro tunc to June 1, 2020, the date on which the
motion baldly asserted that he closed his law practice. As the State
Bar pointed out in its response to his request, Palazzola did not
make the showing required under In the Matter of Onipede, 288 Ga.
156 (702 SE2d 136) (2010), to support nunc pro tunc discipline. See
id. at 157 (“[W]hen an attorney requests [discipline] nunc pro tunc,
it is the lawyer’s responsibility to demonstrate that [he] voluntarily
stopped practicing law, the date on which [his] law practice ended,
and that [he] complied with all the ethical obligations implicated in
such a decision, such as assisting clients in securing new counsel
and facilitating the transfer of client files and critical information
about ongoing cases to new counsel.”). We therefore issued an order
denying Palazzola’s motion, but without prejudice to his renewing it
with a proper showing to support it.
Palazzola promptly filed a second motion requesting imposition
27 of any suspension nunc pro tunc, which was verified by and
supported with an affidavit from Palazzola making the factual
showings required by Onipede; he then filed a verified supplement
and additional affidavit providing even more details about the
termination of his law practice and the steps he took to protect his
clients. The State Bar now has no objection to the imposition of any
suspension to begin nunc pro tunc on June 1, 2020.
(c) Palazzola’s conduct regarding the retirement accounts. As
noted above, Rule 8.4 (a) (4) says: “It shall be a violation of the
Georgia Rules of Professional Conduct for a lawyer to . . . engage in
professional conduct involving dishonesty, fraud, deceit or
misrepresentation.” (emphasis added). In concluding that
Palazzola’s dishonest conduct regarding his associates’ retirement
accounts violated this rule, the Special Master cited only our
statement in West that Rule 8.4 (a) (4) prohibits attorney conduct
that is “intended or likely to mislead another.” 301 Ga. at 904
(citation and punctuation omitted; emphasis in original). But the
conduct in West involved an attorney’s misstatement made in an
28 application for asylum submitted to immigration authorities for his
client, see id. at 901-902, conduct that is unquestionably
“professional” in nature. Cases involving attorney dishonesty,
fraud, deceit, or misrepresentation toward clients and tribunals
come rather obviously within the scope of Rule 8.4 (a) (4). Cases
where the lawyer’s deceptive conduct occurs while he acts in a dual
capacity (like Harrison) or invokes his status and authority as a
lawyer (like Brooks) also fit within the phrase “professional
conduct.”
As the Review Board recognized, however, that phrase is not
so capacious as to encompass everything a lawyer does in the
management of a law office (or for that matter, in life). Many things
that lawyers do while operating their law businesses are no different
than what other business people do in the operation of any business,
and there is no need for the State Bar to regulate activities that
require no specialized professional competence or ethics and pose no
threat to the public’s confidence in the legal system. See In the
Matter of Fry, 302 Ga. 370, 371 (806 SE2d 604) (2017) (explaining
29 that the primary purposes of the attorney disciplinary system are to
protect clients and the public from attorneys who are unqualified to
practice law due to incompetence and unprofessional conduct and to
protect the public’s confidence in the legal system).
Yet lawyers often interact with their clients and present
themselves professionally to the public through their law offices, and
so there may be some deceptive or fraudulent conduct regarding the
management of a law firm that, even if it does not directly involve
misrepresentations to clients or courts, falls within the meaning of
“professional conduct.” For example, a lawyer’s fraudulent
misappropriation of funds from his law firm, even if it did not involve
funds belonging to clients, might be significant enough to qualify as
professional conduct. Such deceptive conduct could amount to a
serious crime that — even if it does not involve client funds — would
upon conviction generally be disciplined by disbarment. See Rule
8.4 (a) (1); In the Matter of Houser, 299 Ga. 284, 285-286 (787 SE2d
689) (2016) (“[D]isbarment is generally the appropriate sanction
when a lawyer engages in serious criminal conduct or conduct
30 involving . . . misrepresentation or fraud.”). Even if a criminal
prosecution for such felonious conduct has not (yet) occurred, the
conduct might implicate the lawyer’s ability to continue to properly
represent clients as well as the public’s perception of the legal
system. We have one case (not cited by the Review Board) that
appears to be of this ilk. See In the Matter of Glass, 279 Ga. 666,
666 (619 SE2d 677) (2005) (accepting a petition for voluntary
discipline and imposing a 12-month suspension where the attorney
admitted a violation of Rule 8.4 (a) (4) based on his misappropriation
of $47,000 from his former law firm operating accounts (rather than
trust accounts), but also paid full restitution and had other
significant mitigating factors).
In no prior disciplinary opinion that we have found, however,
have we set forth a clear construction of the term “professional
conduct” as used in Rule 8.4 (a) (4), in general or in the particular
context of law firm management. Indeed, almost all of the cases in
which we have addressed Rule 8.4 (a) (4) violations contain little if
any analysis of the text or reach of the rule.
31 Recognizing that other states also have attorney disciplinary
systems, we also have looked outside Georgia for guidance. The ABA
Model Rules of Professional Conduct, on which many states’
professional conduct rules are generally based, includes a rule with
language similar — but not identical — to Georgia’s Rule 8.4 (a) (4).
ABA Model Rule 8.4 (c) provides: “It is professional misconduct for a
lawyer to . . . engage in conduct involving dishonesty, fraud, deceit
or misrepresentation.” (emphasis added). Several states with rules
identical or nearly identical to ABA Model Rule 8.4 (c) have applied
those rules to lawyers’ dishonest conduct involving their law firm
employees, including in retirement account situations comparable
to the one in this case. See, e.g., In the Matter of Thompson, 441 P3d
1027, 1031, 1033, 1035-1036 (Kan. 2019) (disbarring an attorney
who engaged in conduct involving dishonesty in violation of Kansas
Rule 8.4 (c) when, among other things, she withheld funds from her
employees’ paychecks but did not deposit those funds into the
employees’ 401(k) accounts, noting that “[r]etaining [the] salary
deferrals could also constitute theft”); In the Matter of Sutton, 405
32 P3d 1205, 1209, 1213 (Kan. 2017) (three-year suspension for an
attorney who engaged in conduct involving dishonesty in violation
of Kansas Rule 8.4 (c) by withholding funds from an associate
attorney and other employees’ paychecks, failing to deposit the
funds into the employees’ IRA accounts, and instead converting the
funds to cover professional expenses); In the Matter of Disciplinary
Proceedings Against Kalal, 704 NW2d 575, 577-578, 581 (Wis. 2005)
(six-month suspension for an attorney who engaged in conduct
involving dishonesty in violation of Wisconsin Rule 8.4 (c) by failing
to deposit funds that had been deducted from an associate attorney
and other employees’ paychecks as contributions for a 401(k) into
the plans or to match employer’s contributions to the plans as
required); Attorney Grievance Comm. of Md. v. Snyder, 793 A2d 515,
534 (Md. 2002) (noting that the attorney had received a private
reprimand in a prior proceeding for violating Maryland’s Rule 8.4 (c)
by failing to pay 401(k) contributions that had been withheld from
employee salaries within 90 days of the deductions as required by
law).
33 But those opinions, like ours, include little if any legal analysis
of the rules they hold were violated, and in particular they do not
discuss whether those rules have any limits with regard to their
application to a lawyer’s management of a law office (or to a lawyer’s
life in general). Moreover, those rules (like the ABA Model Rule)
have the modifier “professional” in a different place than the Georgia
rule, although we have not fully analyzed the effect of that textual
distinction in light of the overall structure and history of the Georgia
rules.
Against this fuzzy background, whether Palazzola’s dishonest
conduct with respect to his associates’ retirement accounts
constituted “professional conduct” in violation of Rule 8.4 (a) (4) does
not have a clear cut answer. On one hand, Palazzola was acting as
a fiduciary in handling the retirement funds of his associate
attorneys — part of their remuneration for representing clients on
behalf of the law firm — and it is important that lawyers properly
handle money entrusted to them. Cf. Rule 1.15 (I) (Safekeeping
Property), Comment 1 (“A lawyer should hold property of others
34 with the care required of a professional fiduciary.”); In the Matter of
Huddleson, 297 Ga. 726, 730-731 (777 SE2d 438) (2015) (“[T]his
[C]ourt’s primary responsibility is to the public to see that those who
are admitted to practice [law] are ethically cognizant and mature
individuals who have the character to withstand the temptations
which are placed before them as they handle other people’s money
and affairs.” (citation and punctuation omitted)). It is also
important that disputes between lawyers in a firm, including
disputes arising from dishonest and misleading conduct, do not
cause harm to clients, including the harms that may result from
lawyers who have been lied to leaving the firm.
On the other hand, Palazzola’s dishonest conduct involved no
client funds. In addition, although the Special Master did not make
pertinent findings, it appears that the amount of funds at issue was
fairly small, see footnote 3 above, and that those funds were not
misappropriated for Palazzola’s personal benefit (at least by the
time his deception was discovered), so this is not a case clearly
involving serious criminal conduct. Moreover, while Palazzola’s
35 deception regarding the associates’ retirement accounts appears to
have been among the reasons the associates left his firm, the record
does not indicate if it was the only reason. And although their
departure contributed to Palazzola’s subsequent violations of Rules
5.3 and 1.16 (d), there is no evidence that any client suffered actual
harm as a result.
Furthermore, on this question of whether Palazzola’s
dishonesty regarding the retirement accounts constituted
“professional conduct,” and where we should draw the line for such
conduct in the management of a law firm, we have no briefing from
the parties, almost no analysis by the Special Master, and
incomplete analysis by the Review Board. And we need not decide
the question — and risk drawing the line in the wrong place — in
this case because as explained above, even if we concluded that
Palazzola did violate Rule 8.4 (a) (4), his suspension nunc pro tunc
to June 1, 2020, would be finished by now. Accordingly, we leave
36 this difficult question to be resolved in a future case.13
(d) Conclusion. For these reasons, Christopher John Palazzola
is hereby suspended from the practice of law nunc pro tunc as of
June 1, 2020, and he is hereby reinstated with the conditions set
forth above.
Suspended nunc pro tunc with conditions; reinstated. Melton, C.J., Nahmias, P. J., and Ellington and McMillian, JJ., concur. Boggs, Peterson, and Bethel, JJ., concur in the judgment and Divisions 1-5 and 6 (a), (b), and (d), and concur specially in Division 6 (c). Warren, J., not participating.
PETERSON, Justice, concurring specially.
13 We note that this Court has not previously disciplined an attorney for
violating Rule 8.4 (a) (4) based on false and misleading advertisements, although courts in other states have concluded that an attorney violated their rules similar to ABA Model Rule 8.4 (c) by using false advertisements and by making false communications regarding the attorney’s qualifications. See, e.g., In the Matter of Cole, 738 NE2d 1035, 1037, 1039 (Ind. 2000) (public reprimand for an attorney who violated Indiana Rule 8.4 (c) by allowing himself to be identified as a county “Prosecutor” in an advertisement when in fact he was not the elected prosecutor); State ex rel. Oklahoma Bar Assn. v. Leigh, 914 P2d 661, 666 (Okla. 1996) (use by an attorney who failed the CPA exam of the title “CPA” on his letterhead to support a billing rate on his statements for services constituted professional misconduct under Oklahoma Rule 8.4 (c), warranting a 180-day suspension). Unlike dishonest conduct involving the internal management of a law firm, however, a lawyer’s false and misleading advertising, the purpose of which is to attract clients to whom the lawyer will provide professional services, falls more neatly within the phrase “professional conduct.” 37 I join the judgment of the Court and all divisions of the Court’s
opinion except Division 6 (c). I agree with Division (6) (c) that
whether misconduct involving the management of a law firm
constitutes “professional conduct” that violates Georgia Rule of
Professional Conduct Rule 8.4 (a) (4) is a difficult question, and one
largely of first impression. I agree that this case does not present a
good vehicle for deciding that difficult question. And I agree that we
need not decide that question to decide this case.
It is precisely for those reasons that I do not join Division 6 (c)
in full. The Division makes a number of observations about
hypothetical situations that might violate the Rule. I do not join in
those observations. The Division cites certain of our Rule 8.4 (a) (4)
decisions, but I am not at all confident that those decisions offer us
any meaningful guidance about the meaning of the Rule’s text. None
of our previous decisions have made any effort to interpret that text,
much less to do so according to the principles that we ordinarily
apply in the interpretation of legal text. See, e.g., Deal v. Coleman,
294 Ga. 170, 172-173 (1) (a) (751 SE2d 337) (2013) (“[W]e must afford
38 the statutory text its plain and ordinary meaning, we must view the
statutory text in the context in which it appears, and we must read
the statutory text in its most natural and reasonable way, as an
ordinary speaker of the English language would.” (cleaned up));
Olevik v. State, 302 Ga. 228, 236 (2) (c) (i) (806 SE2d 505) (2017) (“In
determining the original public meaning of a constitutional
provision, we consider the plain and ordinary meaning of the text,
viewing it in the context in which it appears and reading the text in
its most natural and reasonable manner.”); see also City of Guyton
v. Barrow, 305 Ga. 799, 805 (828 SE2d 366) (2019) (citing above
principles from Deal and Olevik and noting that they “apply to all
positive legal rules” in applying them to agency regulations).
For similar reasons, I am even more skeptical that we will find
useful guidance in opinions of other states. Those opinions apply
different rules with different text, and few if any of them involve
serious textual interpretation even of that different text.
I would also observe that not every bad thing a lawyer does
should jeopardize the lawyer’s ability to work. For that matter, I’m
39 not at all sure that the inherent authority to regulate the practice of
law that the Georgia Constitution vests in this Court includes the
authority to adopt such a far-reaching rule even if the Court wanted
to. And even if the Court’s inherent constitutional authority
extended so broadly, other provisions of the Georgia Constitution
might prohibit the Court from exercising that authority like this.
Georgia lawyers are people too, and the Georgia Constitution’s Due
Process Clause guarantees to the people of Georgia the “right to
work in one’s chosen profession free from unreasonable government
interference.” Jackson v. Raffensperger, 308 Ga. 736, 737 (843 SE2d
576) (2020).
This Court has long exercised the solemn responsibility to
protect the public by regulating the practice of law. The more core to
the protection of the public a regulation is, the more clearly the
exercise of our authority to regulate is “reasonable.” But the further
from that core our regulation strays, the greater the risk that our
reach exceeds our power. It’s not at all clear to me that the dishonest
conduct involving associates’ retirement accounts that is at issue
40 here has anything to do with the protection of the public. (And this,
of course, considers only the right to work long guaranteed by the
Georgia Constitution’s Due Process Clause; other constitutional
rights may require us to tread even more lightly.)
For all these reasons, I do not join Division 6 (c). I am
authorized to state Justice Boggs and Justice Bethel join in this
concurrence.
DECIDED DECEMBER 21, 2020. Suspension with conditions; reinstatement. Paula J. Frederick, General Counsel State Bar, William D. NeSmith III, Deputy General Counsel State Bar, Jenny K. Mittelman, William Van Hearnburg, Jr., Assistant General Counsel State Bar, for State Bar of Georgia.
Related
Cite This Page — Counsel Stack
853 S.E.2d 99, 310 Ga. 634, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-the-matter-of-christopher-john-palazzola-ga-2020.