Bankruptcy Attorney, Replacement Both Get Suspended

A weekly news service that publishes case summaries of the most recent important bankruptcy-law decisions, tracks major commercial bankruptcies, and reports on developments in bankruptcy reform in...

By Diane Davis

July 21 — A bankruptcy attorney who stepped into a debtor's case to fill the shoes of a suspended lawyer and was later sanctioned himself can't get a federal district court to stay the judgment pending appeal ( In re Reed, 2016 BL 227996, E.D. Mo., No. 4:16cv633 RLW, 7/15/16 ).

Judge Ronnie L. White of the U.S. District Court for the Eastern District of Missouri found that the slight harm to the appellants didn't outweigh the significant harm to third parties and the public and, thus, the appellants weren't likely to succeed on the merits.

Judge Charles E. Rendlen, III, of the U.S. Bankruptcy Court for the Eastern District of Missouri suspended debtor's attorney James Robinson from bankruptcy court. Attorney Ross H. Briggs volunteered to represent Robinson's clients who had filed bankruptcy for free.

Subsequently, Rendlen issued two orders asking Robinson to show cause why the court shouldn't order disgorgement of unearned fees. The bankruptcy court also compelled Robinson, Briggs, and Critique Services LLC to turn over discovery. When they failed to do so, the court suspended Briggs for six months and prevented him from using the court's electronic filing system, but said he could continue representing clients he was already representing. Briggs made deliberately misleading representations to the court about the nature of his relationship with Critique, the court said.

Briggs argued that the bankruptcy court lacked constitutional authority to enter the judgment against him because bankruptcy judges are Article I judges, not Article III judges.

Not Likely to Succeed on Merits

Relying on Robinson v. Steward (In re Steward), 2016 BL 217771 (8th Cir. 2016), the district court determined that Briggs and Critique weren't likely to succeed on the merits, and that bankruptcy courts have authority to sanction persons appearing before them.

The court found evidence that allowing the stay would prevent harm to third parties.

Jerome J. Dobson, Dobson and Goldberg, St. Louis, Mo.; Laurence D. Mass, Clayton, Mo.; Ross H. Briggs, St. Louis, Mo., represented debtor Evette Nicole Reed; Laurence D. Mass, Clayton, Mo., represented appellants Critique Services, LLC, Beverly Holmes-Diltz; Jerome J. Dobson, Dobson and Goldberg, St. Louis, Mo., represented appellant Ross Harry Briggs; Seth A. Albin, Albin Law Firm, Clayton, Mo., represented himself as trustee Seth A. Albin; U. S. Attorney - Civil, Office of U.S. Attorney, St. Louis, Mo., represented interested parties Charles E. Rendlen, III, U.S. Bankruptcy Court.

To contact the reporter on this story: Diane Davis in Washington at ddavis@bna.com

To contact the editor responsible for this story: Jay Horowitz at jhorowitz@bna.com

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.