Title: Attorney Grievance v. Downey

State: maryland

Issuer: Maryland Supreme Court

Document:

IN THE COURT OF APPEALS
OF MARYLAND
Misc. Docket AG No. 23
September Term, 2009
ATTORNEY GRIEVANCE COMMISSION
OF MARYLAND
v. 
BARRY KENT  DOWNEY
Bell, C.J.
Harrell
Battaglia
Greene
Murphy
Adkins
Barbera
JJ.
Opinion by Bell, C.J.
       Filed: March 12, 2010 
 
Maryland  Rule 16-771  provides for disciplinary or remedial action, specifically
interim suspension, when an attorney has been convicted of certain crimes.   As relevant, it
instructs:
“(a) Duty of attorney charged. An attorney charged with a serious crime in this
State or any other jurisdiction shall promptly inform Bar Counsel in writing of
the criminal charge. Thereafter, the attorney shall promptly notify Bar Counsel
of the final disposition of the charge in each court that exercises jurisdiction
over the charge.
*     *     *     *
“(b) Petition in Court of Appeals. Upon  receiving and verifying information
from any source that an attorney has been convicted of a serious crime, Bar
Counsel may file a Petition for Disciplinary or Remedial Action in the Court
of Appeals pursuant to Rule 16-751 (a) (2). The petition may be filed whether
the conviction resulted from a plea of guilty, nolo contendere, or a verdict after
trial and whether an appeal or any other post-conviction proceeding is pending.
The petition shall allege the fact of the conviction and include a request that
the attorney be suspended immediately from the practice of law. A certified
copy of the judgment of conviction shall be attached to the petition and shall
be prima facie evidence of the fact that the attorney was convicted of the crime
charged.
“(c) Temporary suspension of attorney. Upon filing of the petition pursuant to
section (b) of this Rule, the Court of Appeals shall issue an order requiring the
attorney to show cause within 15 days from the date of the order why the
attorney should not be suspended immediately from the practice of law until
the further order of the Court of Appeals. If, after consideration of the petition
and the answer to the order to show cause, the Court of Appeals determines
that the attorney has been convicted of a serious crime, the Court may enter an
order suspending the attorney from the practice of law until final disposition
of the disciplinary or remedial action. The Court of Appeals shall vacate the
order and terminate the suspension if the conviction is reversed or vacated at
any stage of appellate or collateral review.”
2
A serious crime is defined as “a crime that is in at least one of the following categories: (1)
a felony under Maryland law, (2) a crime in another state or under federal law that would
have been a felony under Maryland law had the crime been committed in Maryland, and (3)
a crime under federal law or the law of any state that is punishable by imprisonment for three
years or more.” Rule 16-701(k).
Pursuant to the Rule 16-771, an attorney charged with a serious crime is required
promptly to inform Bar Counsel for each jurisdiction in which he or she is admitted to the
Bar, in writing, of the criminal charge and “[t]hereafter ... of the final disposition of the
charge. ...” Rule 16-771(a).  With information concerning the conviction in hand, Bar
Counsel “may file a Petition for Disciplinary or Remedial Action,” in which, in addition to
alleging the fact of the conviction, he requests “that the attorney be suspended immediately
from the practice of law.” Rule 16-771(b).    The filing of the petition triggers the issuance
by the Court of an order requiring the attorney to show cause why he or she should not be
suspended immediately and until further order of the Court and the Court’s determination,
made after considering the petition and the answers by both the Commission and the attorney,
whether to order interim suspension pending final disposition of the disciplinary or remedial
proceedings. Rule 16-771(c).    Prerequisite to that determination is a finding by the Court
that the attorney has, in fact, been convicted of a serious crime.  Id.   As is the case with the
filing of the petition, the decision whether to order an interim suspension is discretionary,
rather than mandatory. Attorney Griev.  Comm’n. v. Protokowicz, 326 Md. 714, 718, 607
1D.C. Code § 26 1002, as relevant, provides:
“(a) After the effective date of this chapter, no person shall engage in the
business of money transmission without obtaining a license issued by the
Superintendent under § 26-1009, except as provided in subsection (d) of
this section and in § 26-1003.”
Subsection (d) grandfathers persons licensed pursuant to another section of the D.C. Code
until their application for license under this section, filed within 90 days of its effective
date, has been acted upon.   Section 26-1003(d). 
2In the Statement of Offense and throughout the proceedings, references to the
corporation were to “E-Gold.” We should do likewise. 
3
A.2d 33, 35 (1992). 
Barry K. Downey, the respondent, co-founder and director of E-Gold, Ltd. and Gold
& Silver Reserve, Inc., corporations engaged in money transmission, was charged in multiple
counts in an indictment filed in the United States District Court for the District of Columbia,
with engaging in the business of money transmission without a license, in violation of D.C.
Code § 26-1002,1 aiding and abetting the operation of an unlicensed money transmitting
business and conspiring with the aforementioned corporations to launder monetary
instruments and to commit an offense against the United States.   Subsequently, the
respondent pled guilty to violating § 26-1002, as a consequence of which the remaining
charges were dismissed.   In the Statement of Offense, the respondent and the Government
agreed that, although the respondent “participated in developing the E-Gold operation’s 2
business model and corporate structure, including its compliance with state and federal
laws,” and “[t]hroughout its operation ... was aware of the E-Gold operation’s activities and
that the business was not licensed as a money transmitting business with the District of
3Pursuant to § 26-1023 (c), engaging in the business of money transmission
without a license is a felony punishable by fine of not more than $ 25,000.00,
imprisonment for not more than 5 years, or both.
4
Columbia,” he “was not extensively involved in the business’s day-to-day funds transactions
operations.”   
The respondent was sentenced, on November 20, 2008, to a 180-day suspended
sentence, in favor of thirty-six (36) months probation and ordered to pay a fine of  
$ 2,500.00,3  a special assessment of $ 100.00 and to perform 300 hours of community
service, at least 100 hours in each year of his probationary period.  As conditions of
probation, the respondent was ordered either to “obtain the necessary state license in any
states that require the licensing of businesses engaged in money transmitting or submit a
request for an advisory opinion from such a state that the E-Gold operation is not required
to be licensed” or to stop operation should licensing not be achieved.
Before imposing that sentence, however, the trial judge expressed the opinion that,
although a serious violation, the offense to which the respondent pled was “just a regulatory
compliance issue.”  She also accepted the representation that, because he was not expert in
the area, the respondent relied on attorneys, hired for that purpose, to advise him and the
companies as to the law governing money transmitting companies and that, together “they
were trying to figure it out ... they were trying.”  Noting the lack of a prior criminal history,
the trial judge finally observed:
4D.C. Bar R. XI, § 10 (a), as relevant, provides:
“Upon learning ... that an attorney has been found guilty of a crime or has
pleaded guilty or nolo contendere to a criminal charge in a court outside the
District of Columbia or in any federal court, Bar Counsel shall promptly
obtain a certified copy of the court record or docket entry of the finding or
plea and transmit it to this Court and to the Board. The attorney shall also
file with this Court and the Board, within ten days from the date of such
finding or plea... a certified copy of the court record or docket entry of the
finding or plea.”
5
“Mr. Downey is a fine upstanding member of his community, of his family. 
He is clearly a good lawyer and a good husband and a good father and a good
member of his church in his community ....
“And I believe him when he says that he didn’t intend to violate the law.  It
happened that way, it came out that way.  He didn’t intend it to be a violation.”
As he was required by Rule 16-771 (a) to do, the respondent, in July 2008,
immediately after entering his guilty plea and therefore before being sentenced, reported the
fact of his guilty plea to Bar Counsel in Maryland and in the District of Columbia, the
jurisdictions in which he was admitted to practice.    The District of Columbia Bar Counsel,
acting pursuant to D.C. Bar R. XI, § 10, the District of Columbia’s equivalent of Rule 16-
771, “notified”4 the District of Columbia Court of Appeals of the respondent’s guilty plea on
September 17, 2008,  In re Downey, 960 A.2d 1135, 1136 (D.C. 2008),  and, by inclusion of
a proposed order to that effect, requested that the court temporarily suspend the respondent
from the practice of law, as the Rule required be done.   Subsection (c) of  D.C. Bar R. XI
provides:
5This is in stark contrast to Maryland Rule 16-771 (c), in which it is clearly and
unambiguously provided that, in response to an order to show cause, the respondent has
the burden to show cause why a temporary suspension should not be ordered.  The
District of Columbia Court of Appeals refused to interpret Rule XI, § 10 (c) as placing the
burden to show cause on Bar Counsel in accordance with the interpretation it, in In re
Malvin, 466 A.2d 1220, 1223 n. 5 (D.C. 1983), had given prior Rule XI, § 3 (3), which
permitted a temporary suspension in cases in which it appeared that an attorney was
“causing great public harm by misappropriating funds to his own use, or by other means.” 
It reasoned:
“Because respondent has been convicted of a ‘serious crime,’ Rule XI, § 10
(c) requires him to show ‘good cause’ why the suspension order that would
otherwise issue as a matter of course should be stayed or ‘set aside.’ 
Respondent’s contrary suggestion that, as in Malvin, the burden here is on
Bar Counsel to justify his interim suspension is contrary to § 10 (c)’s
language and ignores his conviction for a serious crime.   The respondent in
Malvin had not been so convicted when Bar Counsel sought his emergency
suspension.  That difference in situations explains the differing assignment
of burden of proof in the two cases.”  
In re Downey, 960 A.2d at 1137.  Nevertheless, therefore, in light of the interpretation
given D.C. Bar R. XI, § 10 (c) by the District of Columbia Court of Appeals, the effect of
the provisions is the same.
6
“(c) Action by the Court -- Serious crimes. -- Upon the filing with this Court
of a certified copy of the record or docket entry demonstrating that an attorney
has been found guilty of a serious crime or has pleaded guilty or nolo
contendere to a charge of serious crime, the Court shall enter an order
immediately suspending the attorney, notwithstanding the pendency of an
appeal, if any, pending final disposition of a disciplinary proceeding to be
commenced promptly by the Board.” 
The Rule, however, does permit the court, “[up]on good cause shown,” to set aside
the immediate suspension  order “when it appears in the interest of justice to do so.”5   
Relying on this provision, the respondent filed, prior to the court’s issuance of a suspension
order, a motion, which Bar Counsel opposed, asking the court not to enter or to stay the
7
issuance of any order of temporary suspension. 960 A.2d at 1136.  
The court sided with the respondent.   In rejecting Bar Counsel’s argument and staying
the respondent’s suspension from the practice of law, the court considered four (4) factors:
“(1) whether allowing [the respondent] to continue to practice poses an undue
risk of harm to the public; (2) whether there is a substantial likelihood, based
on the available evidence, that the disciplinary proceeding will result in
imposition of a ‘significant sanction’; (3) whether ‘the balance of injuries’
favors stay of the suspension; and (4), related to all these, whether ‘a
suspension is in the public interest.’” 
Id., citing and quoting In re Malvin, 466 A.2d 1220, 1223 (D.C. 1983).   It reasoned:
“[R]espondent has shown good cause for the court to stay the interim
suspension. His prior unblemished record as an attorney; his plea of guilty to
what amounts to a strict liability offense involving no scienter or moral
turpitude; and the fact that his violation arose from conduct outside of his
normal legal practice all suggest a very low degree of risk  that permitting him
to practice in the interim will harm the public. For the same reasons, but
subject of course to development of a factual record in the disciplinary process,
we think that the likelihood that respondent will receive a significant sanction,
i.e., a suspension (if at all) of more than brief duration, is very small. Stated
differently, there is a reasonable possibility on this record that interim
suspension might exceed the sanction that will eventually be imposed on
respondent. Considering, finally, the harm to respondent's livelihood and
ability to support his family that interim suspension may entail, we conclude
that respondent has met his burden to show good cause for why the court
should stay its hand.”
Id. at 1137.   Bar Counsel’s motion for reconsideration was denied.  There was no issue
raised as to the respondent’s compliance with the terms of the plea agreement.  Indeed, the
court specifically pointed out that the respondent “and his business partners have taken steps
to see that the companies are properly licensed and monitored, and have ceased operating
6What is not so clear, given the timing of the notification, the sentencing of the
respondent and the issuance of the court’s opinion, is the extent to which the court was
aware of the trial court’s rationale for the sentence it imposed and how, if at all, that
influenced the court’s suspension decision.  That is complicated further by the facts that
the respondent was sentenced on November 20, 2008, but the certified transcript was not
completed until December 17, 2008, almost two weeks after the court’s opinion had been
filed.  Nevertheless, the assessment of the likelihood of a substantial sanction after
adjudication on the merits and the relationship of the felonious activity to the
respondent’s practice are certainly matters appropriately and uniquely to be considered by
the court.
7In addition to the prima facie evidence of conviction, the “certified copy of the
judgment of conviction,” required by Rule 16-771 ( c) to be filed with the Petition, the
petitioner attached to the Petition the Superceding Indictment under which the respondent
was prosecuted, the Statement of Offense, to which the respondent agreed and stipulated,
and the letter, dated July 18, 2008, in which the complete terms of the plea offer made to,
and accepted by, the respondent were set forth.   In his response, the respondent states:
“The rule does not contemplate that Bar Counsel will file, or that the Court
will consider at this stage, in connection with a request for temporary
suspension, a statement of charges alleging professional misconduct or
other unproven allegations. (Indeed, Md. Rule 16-771 (d) specifically states
that ‘[i]f the Court of Appeals denies a petition filed under section (b) of
this rule, Bar Counsel may [then] file a Statement of Charges under Rule
16-741. ...)”
“Here, Bar Counsel has submitted to the Court along with the
Petition an Indictment that is comprised predominantly of allegations that
were never pursued in court against Mr. Downey and charges against him
that were dismissed with prejudice.  (Indeed, at the conclusion of the
federal action there was a large gap between the allegations made in the
Indictment, on the one hand, and the facts to which the government
stipulated in the Statements of Offense and the sentences that Judge Collyer
imposed[)].  In the Petition itself, Bar Counsel has also asserted facts and
(continued...)
8
them in the meantime.”6  Id. at 1136.  
The Attorney Grievance Commission of Maryland, the petitioner, acting through Bar
counsel, filed against the respondent a Petition for Disciplinary or Remedial Action,7 in
7(...continued)
made charges that are unrelated to the conviction and are thus unauthorized
by, and inappropriate under, Rule[] 16-771 (b).   Mr. Downey’s response,
therefore, focuses on the nature of the conviction, and he requests that the
Court strike or disregard those extraneous matters in its consideration of the
request for temporary suspension.” 
Thus, the respondent takes issue with the petitioner’s appending to the petition anything
other than the certified copy of the judgment of conviction and appears to suggest that the
filing of any petition other than one “seeking temporary suspension” is inappropriate.  We
are not persuaded.
There is no ambiguity in the interim suspension procedure and no inconsistency
between Rule 16-771 (b) and (d).   Rule 16-771 (b), by its express terms, permits - it does
not require - the filing by Bar Counsel of a “Petition for Disciplinary or Remedial
Action.”   If such a petition is filed, the fact of conviction must be alleged and the request
for temporary suspension must be made. That is what was done here.  Rule 16-771 (d)
simply permits Bar Counsel to file a petition alleging any other charge that may be
appropriate if the Court determines that conviction was not of a serious crime, thus,
denying the petition alleging such a conviction.  See D.C.Bar R. XI, § 10 (d) (indicating
that “if the Court determines under subsection (c) of this section that the crime is not a
serious crime, the proceeding shall go forward on any charges under the Rules of
Professional Conduct that Bar Counsel may institute.”). 
To be sure, the only issue to be decided at this preliminary stage is the propriety of
temporarily suspending the respondent as a result of his conviction of a serious crime.  
That decision can not be made in a vacuum or, indeed, in the absence of a charge.  It is,
therefore, not surprising a Petition for Disciplinary or Remedial Action, containing a
certified judgment of conviction, was filed against  the respondent.   The Indictment and
the Statement of Offense and the plea offer, when considered with the certified judgment,
merely provides, and we shall consider it only as, context for the decision to be made.    
8Rule 8.4 of the Maryland Lawyer’s Rules of Professional Conduct, as relevant,
provides:
“It is professional misconduct for a lawyer to:
“(a) violate or attempt to violate the Maryland Lawyers’ Rules
of Professional Conduct, knowingly assist or induce another
to do so, or do so through the acts of another;
(continued...)
9
which, referencing the acceptance of the respondent’s guilty plea to a felony and sentencing,
it was charged that the respondent violated Rule 8.4, Misconduct,8 of the Maryland Rules of
8(...continued)
“(b) commit a criminal act that reflects adversely on the
lawyer's honesty, trustworthiness or fitness as a lawyer in
other respects;
“(c) engage in conduct involving dishonesty, fraud, deceit or
misrepresentation;
“(d) engage in conduct that is prejudicial to the administration
of justice. ...”
10
Professional Conduct, as adopted by Maryland Rule 16-812.   The petitioner also requested
this Court, pursuant to Maryland Rule 16-771 ( c), to issue an order requiring the respondent
to “ show cause in writing why he should not be suspended immediately from the practice
of law in this State until further order of this Court” and to “[s]uspend the respondent
immediately from the practice of law.”
In his answer to the Show Cause Order, the respondent urged the Court to reject the
petitioner’s request that it order the respondent immediately suspended from the practice of
law.  Noting what is the well-settled holding of this Court, that an interim suspension for
conviction of crime, pursuant to Maryland Rule 16-771 ( c), is permitted, not required,
Attorney Griev.  Comm’n. v. Protokowicz, 326 Md. at 718, 607 A.2d at 35 (“As respondent
points out, Rule BV16 authorizes an interim suspension; it does not mandate such action.”);
Attorney Griev. Comm’n. v. Klauber, 283 Md. 597, 599-600, 391 A.2d 849, 851 (1978)
(footnote omitted) (“It must be borne in mind that Rule BV16 does not make suspension
mandatory, but makes it discretionary in this Court pending resolution of an appeal.”), he
11
argued that interim suspension is neither required nor warranted for the protection of the
public.   In support of that argument, he focused on his professional history, highlighting
specifically the absence of disciplinary encounters, never mind sanctions, and on his record
and his pro-bono and community efforts.  The respondent also found it significant and, so,
emphasized the prior proceedings involving his guilty plea, the guilty plea sentencing
proceedings themselves and the interim suspension proceedings in the District of Columbia
Court of Appeals.  Thus, the respondent directed our attention to the sentencing judge’s
comments with regard to his competence, his community and church involvement and the
intent with which the offense to which he pled guilty was committed, and that, as to the
latter, the sentencing judge believed that the respondent did not intend to commit the crime
of which he was convicted.   Of equal significance, the respondent submitted, was the
decision of the District of Columbia Court of Appeals to deny its Bar Counsel’s motion for
interim suspension.  
For the petitioner, it is enough to merit temporary suspension that the respondent has
been convicted of violating D.C. Code § 26-1002 and Rule 16-771 permits that result. 
Although asked more than once at oral arguments for a basis other than the aforementioned,
no other analysis or rationale was offered.  
An interim suspension is a “preliminary matter” to be resolved “without a full record,”
Klauber, 283 Md. at 600, 391 A.2d at 851, or a hearing on the merits; hence, it is in the
nature of an emergency measure.   As such, the decision to suspend on an interim basis
9Rule BV16 a 1 defined the crimes to which the Rule applied. They included
crimes that were felonies under Maryland law and “any other crime punishable by
imprisonment for three years or more.”
12
depends on, and follows, consideration of the petition filed by Bar Counsel and the attorney’s
answer to the order to show cause issued by the Court and requires a determination that the
attorney has been convicted of a serious crime.  Thus,  in addition to the fact of conviction,
the nature of the crime, i.e., what the elements of the crime tell us about the attorney's
character and, hence, the need to protect the public, and only judicial admissions made by the
attorney may be considered.  The suspension decision may not be based on the facts alleged
by bar counsel to aggravate the particular conviction or facts that are not necessarily evident
from the conviction itself. 
This Court addressed the interim suspension rule and its applicability when an
attorney has been convicted of a serious crime in Protokowicz, supra, albeit in the context
of the predecessor to Rule 16-771 (b), Maryland Rule BV16 a 2 .9   That Rule provided:
“If an attorney is convicted of a crime to which this Rule is made applicable
pursuant to Rule BV16 a 1, whether the conviction results from a plea of guilty
or of nolo contendere or from a verdict after trial, and regardless of the
pendency of an appeal or any other post-conviction proceeding, the Bar
Counsel shall file charges with the Court of Appeals alleging the fact of the
conviction and requesting that the attorney be suspended from the practice of
law. A certified copy of the judgment of conviction shall be attached to the
charges and shall be prima facie evidence of the fact that the attorney was
convicted of the crime charged.”
Id. at 715, 607 A.2d at 34.  We stated that the purpose of the Rule “is to protect the public
10A majority of the Court determined that it had a further purpose, “to maintain
public confidence in the legal profession.” 326 Md. at 716, 607 A.2d at 34. This
extension of the purpose was necessary because, although the crime of which
Protokowicz had been convicted, breaking and entering, was a “serious crime” within the
definition of Rule BV16 a, being "a crime punishable by imprisonment for three years or
more,” it had no required moral element or character flaw, as was envisioned by the
element of the Rule’s predecessor that the interim suspension eligible crime be one
“involving moral turpitude,” and, consequently, the factors that would establish the
offense, “standing alone, may suggest that an interim suspension would be inappropriate
in a variety of circumstances surrounding a conviction of this offense.” 326 Md. at 719,
607 A.2d at 35. 
13
from acts of an attorney who has been convicted of certain crimes. ...”10 Id. at 716, 607 A.2d
at 34.   Acknowledging that a conviction for the crime of breaking and entering under former
Md. Code ( 1957, 1992 Replacement Vol.) Art. 27, § 31A, “standing alone, may suggest that
an interim suspension would be inappropriate in a variety of circumstances surrounding a
conviction of this offense,” id. at 719, 607 A.2d at 35, the Court proceeded to consider “the
surrounding circumstances of the offense as established by facts not in dispute” and, on that
basis, to order an immediate suspension.  Id. at 720, 607 A.2d at 36.   Among the decisive
“surrounding circumstances” considered by the Court were:
“The Respondent and Mr. Sanders broke into Mrs. Sanders' home to take a
stock certificate claimed by Mr. Sanders. Mrs. Sanders' toilet was stopped up
and her contraceptive devices were placed on the bathroom floor. A
photograph of Mrs. Sanders and her daughter was turned on its side. The
Respondent allegedly stole and read Mrs. Sanders' personal letters. During the
break-in, the Respondent advised his former client that he could remove
marital property from Mrs. Sanders' residence. The Respondent assisted his
former client with the theft of Mrs. Sanders' jewelry and other personal
property. The Respondent took a bottle of champagne from Mrs. Sanders'
14
refrigerator and spilled the champagne on the floor.”
Id. at 719, 607 A.2d at 35-36.
As in Protokowicz, the offense of which the respondent stands convicted does not
reveal anything about the respondent’s character and, thus, the need to protect the public
from his practice of law and, indeed, “standing alone,  may suggest that an interim
suspension would be inappropriate in a variety of circumstances surrounding a conviction
of this offense.”   Unlike Protokowicz, the “surrounding circumstances” do not suggest or
indicate that interim suspension would be justified or appropriate.  On the contrary, they
confirm that such a suspension would, in fact, be inappropriate in this case.
The applicable “surrounding circumstances” in this case are the sentencing
proceedings and the interim suspension proceedings before the District of Columbia Court
of Appeals.  In the former, in her sentencing comments, the sentencing judge confirmed that
the nature of the crime, in and of itself, did not suggest or in any way indicate the need to
protect the public; she characterized it as “just a regulatory compliance issue.”   Moreover,
the judge expressed the belief that the respondent did not intend to violate the law and, in fact
was trying, with the help of counsel hired for the purpose, to comply.   Further evidence of
the sentencing judge’s views on the subject of the public’s need for protection is her
characterization of him as a fine community and church person and a fine lawyer.
The result of the interim suspension proceedings are even more persuasive with regard
15
to the appropriate resolution of the suspension issue in this case.   The court, as we have seen,
citing the respondent’s “unblemished record as an attorney,” the nature of the crime - that it
“involv[ed] no scienter or moral turpitude” - , and   that the “violation arose from conduct
outside of his normal legal practice,” determined that the respondent had met his burden of
showing that an interim suspension was not required for the protection of the public.
 Those considerations that the District of Columbia Court of Appeals found
determinative apply equally here.  We agree with that court that the respondent has shown
good cause.  Accordingly, we deny the petitioner’s request for interim suspension.
It is so Ordered.