In Re: Jonathan Andry , 921 F.3d 211 ( 2019 )

Case: 18-31245 Document: 00514890507 Page: 1 Date Filed: 03/27/2019
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 18-31245
FILED
March 27, 2019
Lyle W. Cayce
IN RE: JONATHAN B. ANDRY, Clerk
Appellant
Appeals from the United States District Court
for the Eastern District of Louisiana
Before BARKSDALE, SOUTHWICK, and HAYNES, Circuit Judges.
HAYNES, Circuit Judge:
Jonathan Andry (“Andry”) appeals the decision of the en banc Eastern
District of Louisiana (“Eastern District”), here represented by the Lawyer
Disciplinary Committee for the Eastern District of Louisiana (“the
Committee”), suspending his authority to appear before the Eastern District
for one year. 1 We VACATE and REMAND for further proceedings.
This case arises from alleged improprieties in the Deepwater Horizon
multi-district litigation “Court Supervised Settlement Program” (“CSSP”).
Specifically, attorney Lionel Sutton represented clients with CSSP claims and
transferred those clients to other firms prior to becoming a CSSP staff
attorney. One of the firms Sutton referred clients to was AndryLerner, of
which appellant Jonathan Andry was an equity shareholder.
1 The one year has not yet started because we previously suspended the Eastern
District’s order pending this appeal.
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It was alleged that while Sutton was employed by the CSSP, Andry
funneled numerous referral payments to Sutton for a CSSP client. The district
court appointed Louis Freeh as a special master to investigate “the facts and
circumstances that led to the resignation of Sutton [from the CSSP] and
conduct fact-finding as to any other possible ethical violations or misconduct
by the CSSP.” (internal alterations and quotation marks omitted). The special
master’s report recommended that Andry be prevented from representing
claimants in the CSSP, and the district court ordered him to show cause as to
why it should not adopt the special master’s recommendation. Following an
evidentiary hearing and an opportunity to respond in writing, the same district
judge who issued the order and oversaw the MDL and CSSP issues determined
that Andry violated the Louisiana Rules of Professional Conduct and
disqualified him from participating in the CSSP or collecting fees. But the
district court noted that Andry’s misconduct “did not cause or result in any
corruption of the claim evaluation process” and that “no claim represented by
Jon Andry . . . was expedited in a significant way.” Andry appealed the
financial sanctions, which this court affirmed. See In re Deepwater Horizon,
824 F.3d 571, 587 (5th Cir. 2016) (per curiam). 2
At the district court’s direction, the special master referred the matter to
the Chief Judge of the Eastern District and to the Committee. Andry was
notified of the complaint and responded in writing. The Committee referred
its confidential report to the Eastern District. On October 24, 2018, the en
banc court filed an order finding Andry violated the Louisiana Rules of
Professional Conduct and suspending him from practicing law in the Eastern
District of Louisiana for one year. The Eastern District concluded that Andry’s
2 This affirmance explicitly relied upon the narrow tailoring of the sanctions in the
Deepwater Horizon proceeding and thus does not answer the specific questions presented in
this appeal. Id. at 586.
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prior hearing before the MDL judge constituted an evidentiary hearing. Andry
timely responded, objecting that the Eastern District was imposing summary
discipline under its rules 3 and requesting a hearing under them. The Eastern
District overruled Andry’s objection and denied his request for a hearing,
stating that “another hearing is neither necessary nor warranted.” Andry
timely appealed.
Andry raises two issues, one based upon the EDLA Rules and one based
upon constitutional due process. Because we conclude that the first issue
resolves this appeal 4, we need not reach the second.
We review sanctions imposed against an attorney by a district court for
abuse of discretion. In re Mole, 822 F.3d 798, 801 (5th Cir. 2016) (per curiam).
Although we must defer to reasonable interpretations by the district court of
its rules, see id. at 802, if we are “convinced that the district court has
misconstrued its own rules,” it has abused its discretion. Id. The district court
must “observe scrupulously its own rules of disciplinary procedure.” In re
Thalheim, 853 F.2d 383, 390 (5th Cir. 1988) (per curiam) (internal citations
omitted).
The Eastern District undoubtedly thought that it did observe its own
rules. Having carefully reviewed the record in light of the EDLA Rules,
however, we conclude that it failed to apply the rules properly to this case.
3The rules in question are entitled “Eastern District of Louisiana Rules for Lawyer
Disciplinary Enforcement” (hereinafter “EDLA Rules”). Although there have been various
amendments to the EDLA Rules over the past few years, none affect the outcome here. We
use the version of the EDLA Rules proffered jointly by the parties (listed as “Amended
November 16, 2016”) and grant their motion to supplement the record with that version of
these rules.
4 Jurisdiction is not in question here. Federal courts may hold attorneys accountable
to state codes of professional conduct and have inherent power to discipline attorneys. See
Resolution Tr. Corp. v. Bright, 6 F.3d 336, 341 (5th Cir. 1993) (citing In re Snyder, 472 U.S.
634, 645 n.6 (1985)). We have jurisdiction over the appeal under 28 U.S.C. § 1291.
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The key question here is whether Andry is entitled to a hearing under
the EDLA Rules or whether the prior sanctions hearing before the MDL judge
suffices. We examine the text of the relevant EDLA Rules to make this
determination.
Rule 5 of the EDLA Rules explains the role of the Committee and
provides that it should review a complaint and make a recommendation to the
Eastern District. That same rule specifically defines the term “summary
discipline” as “discipline without a hearing.” EDLA Rule 5.2.1(b).
Once the Eastern District receives the Committee’s recommendation, the
rules state:
Evaluation by En Banc Court. After consideration of the materials
set forth above, the en banc court must:
6.3.1. Dismiss the complaint,
6.3.2. Impose summary discipline,
6.3.3. Docket the matter for hearing, or
6.3.4. Take such other action as the court deems appropriate.
EDLA Rule 6.3 (emphasis added). When summary discipline is imposed, the
affected attorney has the right to request a hearing in which case “the matter
must be docketed for a hearing.” EDLA Rule 6.5.2 (emphasis added). Such a
hearing must be before a judge other than the one who filed the complaint if
the complaint was “based upon conduct occurring in a matter to which the
judge is assigned.” EDLA Rule 7.2.
The parties do not dispute that the Committee submitted a confidential
report, the en banc court imposed discipline without a Rule 7 hearing, and
Andry objected and requested a hearing, but was overruled. Instead, the
Committee argues that the en banc court imposed discipline under Rule 6.3.4,
which states the en banc court may “[t]ake such other action as the court deems
appropriate.” Under this rationale, the Committee asserts Andry’s discipline
was not “summarily imposed” under Rule 6.3.2 because he was already
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provided an evidentiary hearing on potential financial sanctions before the
district court in 2014.
When two provisions of the same rule operate in pari materia, they
should be construed together. United States v. Moss, 872 F.3d 304, 310 (5th
Cir. 2017). Rules 5.2 and 6.3 give the same four choices for the Committee to
recommend and the en banc court to adopt: dismiss the complaint, impose
summary discipline, set the matter for hearing, or take other appropriate
action. All four provisions must be given effect, “in order not to render portions
of [the Rules] inconsistent or devoid of meaning.” In re Supreme Beef
Processors, Inc., 468 F.3d 248, 253 (5th Cir. 2006) (en banc) (citation omitted).
Moreover, specific provisions such as Rules 6.3.1, 6.3.2, and 6.3.3 should govern
more general provisions like Rule 6.3.4. See RadLAX Gateway Hotel, LLC v.
Amalgamated Bank, 566 U.S. 639, 645 (2012). We conclude that the term
“other” cannot be construed so broadly as to negate the entirety of the EDLA
Rules, specifically Rules 6 and 7. Under the Committee’s reading of the rules,
Rules 6.3.1–6.3.3 are meaningless, as the Eastern District is empowered to do
whatever it wants. 5
The Committee asserts that we cannot construe the Eastern District’s
discipline as “summary discipline” because of the prior sanctions hearing. But
that hearing cannot qualify as a hearing under the EDLA Rules because it was
held in front of the same Deepwater Horizon MDL judge who ordered the
complaint at issue filed. The complaint in this case is clearly “based upon
conduct occurring in a matter to which the [MDL] judge is assigned.” Thus,
5 The Committee also argues that the en banc court was within its right to suspend
Andry under Rules 3, 3.1, and 8, which articulate that a lawyer may be disciplined if she or
he has committed misconduct, and that available sanctions include suspension. But Andry
does not contest these points; his argument addresses what process must occur under the
Rules prior to any discipline. Thus, the Committee’s arguments are inapposite as to Rules 3
and 8.
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even if we ignored the timing and different purpose of the prior sanctions
hearing, it cannot qualify as a Rule 7 hearing given the identity of the presiding
judge.
In short, the plain text of Rule 6.4 favors Andry’s argument for another
hearing. Rule 6.4 states, in relevant part, “[t]he order proposing summary
discipline must require the respondent to show cause within 14 days after
service why the proposed summary disciplinary sanction should not be
imposed.” Here, the proposed discipline of the district court and special
master, restricting participation in the CSSP, is not the same discipline as a
suspension imposed by the en banc district court. This distinction favors
Andry’s request for a hearing because he could not respond to a show cause
order for a proposed sanction of which he was unaware.
Thus, we conclude that the EDLA Rules require that Andry receive a
Rule 7 hearing before discipline is imposed by the Eastern District. In
accordance with those rules, that hearing cannot be held before the Deepwater
Horizon MDL judge. Because we decide this case on the rules in question, we
need not address whether a post-complaint hearing is required under
constitutional due process principles.
VACATED and REMANDED.
6