[Until this opinion appears in the Ohio Official Reports advanc e sheets, it may be cited as Disciplinary Counsel v. Smidt , Slip Opinion No. 2020-Ohio-3258.]

NOTICE This slip opinion is subject to formal revision before it is pu blished in an advance sheet of the Ohio Official Reports. Readers are req uested to promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65 South Front Street, Columbus, Ohio 43215, of any typographic al or other formal errors in the opini on, in order that corrections m ay be made before the opi nion is published.

S LIP O PINION N O

. 2020-O HIO -3258

D ISCIPLINARY C OUNSEL v. S MIDT

. [Until this opinion appears in t he Ohio Official Reports advanc e sheets, it may be cited as Disciplinary Counsel v. Smidt , Slip Opinion No. 2020-Ohio-3258.] Unauthorized practice of law—Preparing and negotiating modification of loan that was subject of pending foreclosure proceeding—Permanent injunction issued and ci vil penalty imposed. (No. 2019-0827—Submitted April 8, 2020—Decided June 11, 2020.)

O N F INAL R EPORT by the Board on the Unauthor ized Practice of Law of the Supreme Court, No. UPL 18-01.

_______________________ Per Curiam. {¶ 1} In an April 2018 complaint, relator, disciplinary counsel, char ged respondent, Melissa M. Smidt, d.b.a. A Perfect Solution, with e ngaging in the unauthorized practice of law in Ohio. The complaint alleged th at Smidt, who is not licensed to practice law in Ohio, agreed to assist Deborah Krantz with aS UPREME C OURT OF O HIO

2 foreclosure matter that was pending in the Franklin County Cour t of Common Pleas and sought to modify the terms of the subject loan during the pendency of the lender’s foreclosure proceeding. The complaint further all eged that although Smidt represented that she unde rtook those actions as a paraleg al under the supervision of an attorney, the attorney was unaware of and did not participate in Smidt’s representation of Krantz. {¶ 2} Smidt was served with a copy of relator’s complaint by certifie d mail, but she did not file an answer. On August 16, 2018, rela tor filed a motion for default. Smidt also did not respond to relator’s motion, w hich states that it was served on her by ordinary U.S. mail and by e-mail. {¶ 3} A three-member panel of the Board on the Unauthorized Practice of Law granted relator’s motion for default on October 10, 2018. The panel also submitted to the board a report finding that relator’s motion s atisfied the requirements of Gov.Bar R. VII(7) (B)(1) through (6) and that Sm idt had engaged in the unauthorized practice of law. The panel recommended tha t Smidt be enjoined from engaging in additional acts of the unauthorized p ractice of law and be ordered to pay a civil penalty of $5,000 for her violation. The board considered the panel’s report at its March 22, 2019 meeting and adopted its findings and recommendations. {¶ 4} After reviewing the record, we a gree that Smidt engaged in the unauthorized practice of law in Ohio and that an injunction and civil penalty are

warranted.

Smidt’s Conduct {¶ 5} The evidence submitted with relator’s motion for default shows that Smidt operated A Perfect Solution in the Bay Village, Ohio area . The business purported to be a “knowledgeable , fully committed professional company preparing Loan Modifications and Bankruptcy Petitions under the direct supervision of Consumer Bankrupt cy Attorneys.” Although Smidt previously hadJanuary Term, 2020

3 been employed by an attorney as a contract paralegal assistant, she was not licensed to practice law in Ohio. {¶ 6} In March 2015, Deborah Krantz hired Smidt and paid her a flat f ee of $1,000 to prepare and negotiate the modification of a loan t hat was the subject of a pending foreclosure proceeding—despite the fact that Krant z already had an attorney representing her in the foreclosure. In the fee agree ment, Smidt stated that she would prepare and nego tiate the loan modification, “al ong with, attending any/all mediation hearings, wr itten statements , telephone confe rences.” {¶ 7} During the course of the repres entation, Smidt sent two letters to Krantz’s mortgage lender on the letterhead of attorney J. Norma n Stark. In the first letter, Smidt identified herself as a paralegal and “the legal representative appointed to act or speak on beha lf of Ms. Deborah Krantz, for the limited purpose of negotiating a loan m odification.” In the second let ter, Smidt related the hardships that had prevented Krantz from satisfying her loa n obligations and opined that Krantz was an excelle nt candidate for a loan modifi cation. {¶ 8} Smidt later informed Krantz that she had spoken with one of the attorneys representing the lender and implored him to stay the execution of the sale in the foreclosure proceeding to give her time to submit a loan-modification packet. She also e-mailed Krantz’s foreclosure attorney and in formed him that she had spoken with the underwr iter for Krantz’s loan but that the lender needed

more time to make a loan-modifi cation offer. To that end, Smid t suggested that the attorney prepare and file—with her help—a motion to stay ex ecution of the judgment, a motion to return the foreclosure case to mediation, or a motion for relief from judgment under Civ.R. 60(B) to delay the foreclosur e proceeding. Smidt also informed the attorney that she had spoken with the s upervisor of the court’s mediation depa rtment and that he had told her that alth ough the foreclosure case had been referred to mediation, the case had b een returned to the court’s docket because no one had appeared for the scheduled me diation. SmidtS UPREME C OURT OF O HIO

4 opined that the judge would likely deny a request to return the case to mediation but stated, “I would place a strong argument for a return to me diation as a full loan modification of over 100 pages was provided to the Lender and currently, we’re in the middle of nego tiations with the Lender.” {¶ 9} Smidt’s efforts to delay the foreclosure proceedings were not successful, and the court confirmed the sheriff’s sale of Krant z’s real property on June 19, 2015. On July 1, 2015, Krantz terminated Smidt’s serv ices and requested the return of her documents and a full refund of her fee, but Smidt did not comply with either request. {¶ 10} In her correspondence with relator—before she stopped participating in this matter—Smidt claimed that the actions she took on behalf of Krantz were taken under the supervision of attorney Stark. She also furnished relator with several documents, including the two letters she h ad sent to Krantz’s mortgage lender on Stark’s letterhead. {¶ 11} In a March 2017 affidavit, however, Stark denied that he had represented Krantz and stated that he had received no fee or re tainer from her. He also stated that he had terminated Smidt’s employment as a “par alegal assistant” due in part to her unauthorized practice of law and her unautho rized use of his

law-office letterhead. Stark averred that after he terminated Smidt’s employment,

she continued to use his lette rhead without his knowledge or co nsent. Although he repeatedly demanded that Smidt cease and desist from that co nduct, he received no response from her. T here is no evidence that any o ther licensed attorney was supervising Smid t’s provision of legal services. {¶ 12} Based on relator’s evidence, t he board found that Smidt had engaged in the unauthorized prac tice of law by attempting to re present Krantz in her pending foreclosure matter a nd by contacting Krantz’s mortg age lender in an attempt to modify the terms of the loan.January Term, 2020

5 Smidt Engaged in t he Unauthorized Practice of Law {¶ 13} This court has original jurisdiction over the admission to the practice of law in Ohio, the discipline of persons so admitted, and “all other matters relating to the practice of law,” Article IV, Section 2 (B)(1)(g), Ohio Constitution, which include the regulation of the unauthorized practice of law. Royal Indemn. Co. v. J.C. Penney Co., Inc. , 27 Ohio St.3d 31, 34, 501 N.E.2d 617 (1986); Greenspan v. Third Fed. S. & L. Assn. , 122 Ohio St.3d 455, 2009-Ohio3508, 912 N.E.2d 567, ¶ 16. The purpose of that regulation is to “protect the public against incompetence, divided loyalties, and other atten dant evils that are often associated with unskilled representation.” Cleveland Bar Assn. v. CompManagement, Inc. , 104 Ohio St.3d 168, 2004-Ohio-6506, 818 N.E.2d 1181, ¶ 40. {¶ 14} We have defined the unauthorized practice of law to include bot h the “rendering of legal services for another” and the “[h]oldin g out to the public or otherwise representing oneself as authorized to practice law in Ohio” by any person who is not authorized to practice law under our rules. Gov.Bar R. VII(2)(A)(1) and (4). Although unlicensed persons may provide certain types of assistance in the rendering of legal services, “the individual’ s actions must be closely supervised and approved by a licensed attorney.” Disciplinary Counsel v. Casey , 138 Ohio St.3d 38, 2013-Ohio-5284, 3 N.E.3d 168, ¶ 10. In th e absence of such supervision, the provisi on of legal services by an unli censed person

constitutes the unauthor ized practice of law. Id. {¶ 15} We have held that nonlawyers engage in the unauthorized practic e of law “by attempting to represent the legal interests of other s and advise them of their legal rights during settlement negotiations,” Cincinnati Bar Assn. v. Foreclosure Solutions, L.L.C ., 123 Ohio St.3d 107, 2009-Ohio-4174, 914 N.E.2d 386, ¶ 25, particularly whe n those nonlawyers are “attempting t o advise debtors of their legal rights and the terms and conditions of settlement i n negotiations toS UPREME C OURT OF O HIO

6 avoid pending foreclosure or other collection proceedings,” id. at ¶ 26, citing

Ohio State Bar Assn. v. Kolodner , 103 Ohio St.3d 504, 2004-Ohio-5581, 817 N.E.2d 25, and Cincinnati Bar Assn. v. Telford , 85 Ohio St.3d 111, 707 N.E.2d 246 (1999). {¶ 16} Recently, in Ohio State Bar Assn. v. Watkins Global Network,

L.L.C. , __ Ohio St.3d __, 2020-Ohio-169, __ N.E.3d __, ¶ 10, we clari fied that there is no per se rule that any nonlawyer who negotiates a deb t settlement on behalf of another engages in the unauthorized practice of law. Instead, we held that “whether a person engages in the unauthorized practice of law turns on the specific actions a person takes while attempting to negotiate a settlement and whether those actions constitute the rendering of legal service s,” id. , such as giving legal advice, drafting legal documents, or asserting leg al defenses as part of the negotiation process, id. at ¶ 11. {¶ 17} Watkins represented the interests of a debtor in loan negotiati ons with a bank during the pendency of a mortgage foreclosure actio n in which the bank had secured a final judgment in foreclosure and the releva nt property was

scheduled to be auctioned. Id. at ¶ 17. In that representation, he engaged in the unauthorized practice of law by giving legal advice to his clie nt, by making a legal recommendation to an attorney in the foreclosure proceedi ng, and by using legal tactics in an effort to negotiate a better settlement for his client. Id. at ¶ 17-18. {¶ 18} Like Watkins, Smidt represen ted Krantz in a foreclosure proceeding in which the court had already issued a final judgme nt of foreclosure and scheduled a sheriff’s sale. Although the board found no ev idence that Smidt gave legal advice directly to any of her “clients,” Smidt gave litigation advice to

Krantz’s counsel of record in an effort to delay the foreclosur e proceeding and to buy more time to negotiate a modification of the loan with Kran tz’s lender. She also contacted a court repres entative on Krantz’s behalf.January Term, 2020

7 {¶ 19} On these facts, we accept the board’s finding that Smidt engage d in the unauthorized pr actice of law. An Injunction and Civil Penalty Are Warranted {¶ 20} Because we have found that Smid t engaged in the unauthorized practice of law, we adopt the board’s recommendation that we is sue an injunction prohibiting her from further eng aging in the unauthorized pract ice of law in Ohio. {¶ 21} The board also recommends that we impose a civil penalty of $5,000 pursuant to Gov.Bar R. VII(8)(B), which instructs us to consider (1) the degree of a respondent’s cooperati on during the investigation, (2) the number of times the respondent engaged in the unauthorized practice of la w, (3) the flagrancy of the respondent’s viol ations, (4) any harm that the violations caused to third parties, and (5) any other relevant factors, which may in clude the aggravating and mitigating circumstances identified in UPL Reg. 400(F). {¶ 22} Smidt’s participation in relator’s investigation was almost nonexistent. She provided a par tial reply to one of relator’s letters of inquiry, but

she did not answer relator’s com plaint, respond to its motion f or default, or otherwise appear in this proceeding. {¶ 23} Although relator charged Smidt w ith engaging in the unauthorize d practice of law only in the Krantz matter, he did submit eviden ce that Smidt had engaged in similar instances of the unauthorized practice of la w with respect to other persons. Moreover, Smidt’ s conduct was flagrant. Smidt’ s use of the designations “ACP” (Advanced Cer tified Paralegal) and “RP” (Reg istered Paralegal) in the signature line of her correspondence indicate s that she is a trained paralegal. Therefore, sh e would have received instruct ion regarding the actions she was permitted and not permitted to take as a parale gal. She not only chose to ignore those instructions but also engaged in the unau thorized use of attorney Stark’s law-office letterhead—even after receiving his demand to cease

and desist. Her intentional and deceitful misuse of Stark’s le tterheadS UPREME C OURT OF O HIO

8 demonstrates her knowledge that in the absence of direct superv ision by a licensed attorney, the actions she took on behalf of Krantz con stituted the unauthorized practice of law. {¶ 24} In light of these aggravating factors, we agree that a civil pe nalty of $5,000 is warranted for Smidt’s si ngle instance of the unauthor ized practice of

law.

Conclusion {¶ 25} Accordingly, we enjoin Melissa M. Smidt from engaging in furthe r acts constituting the unauthoriz ed practice of law in Ohio. We also order Smidt to pay a civil penalty of $5,000. C osts are taxed to Smidt. Judgment accordingly.

O’C ONNOR , C.J., and F RENCH , F ISCHER , D ONNELLY , and S TEWART , JJ.,

concur. D E W INE , J., concurs in judgment only, with an opinion joined by

K ENNEDY , J.

_________________ D E W INE , J., concurring in judgment only. {¶ 26} I agree with the majority that Melissa Smidt violated our rules prohibiting the unauthorized prac tice of law. I have no proble m reaching that conclusion, because her actions, especially her use of an attor ney’s letterhead, falsely conveyed that she was working with an attorney. And sh e persisted in this conduct despite being told by tha t attorney to stop using the l etterhead. Her

behavior would mislead a reasona ble person about the nature of the services Smidt was offering and there fore violated our rules. {¶ 27} But I wish to highlight a few points of departure from the majo rity. First, as I have previously explained, merely offering an opini on with legal implications is not, on its own, sufficient to count as the una uthorized practice of

law. See Ohio State Bar Assn. v. Watkins Global Network, L.L.C. , __ Ohio St.3dJanuary Term, 2020

9 __, 2020-Ohio-169, __ N.E.3d __, ¶ 38-39 (DeWine, J., concurrin g in part and dissenting in part). Rather, t o count as the practice of law, the behavior must more closely resemble that which is paradigmatic of what attorn eys do. And in making this assessment, we must be mindful that the purpose of the unauthorizedpractice-of-law rules is to protect the public, but in a way th at doesn’t impose impractical and unnecessary technical constraints. See Henize v. Giles , 22 Ohio St.3d 213, 218, 490 N.E.2d 585 (1986), citing Cowern v. Nelson , 207 Minn. 642, 647, 290 N.W. 795 (1940). {¶ 28} To hastily conclude that someone has engaged in the unauthorize d practice of law simply because she has voiced a legal opinion r uns the risk of unnecessarily and improperly burdening the activities of many p eople, including accountants, human-resource repres entatives, and real-estate ag ents, whose jobs require them to opine on legally relevant matters. It also ris ks running afoul of various constitutional protections and antitrust limitations. See Watkins Global at ¶ 33-35 (DeWine, J., concurring i n part and dissenting in part)

. {¶ 29} Second, I do not agree that debt negotiation, even in the conte xt of a foreclosure, is necessarily the practice of law. To find tha t someone has engaged in the practice of law d epends on first determining tha t she provided legal services—that is, engaged in behavior that is paradigmati cally the exclusive work of lawyers. Insofar as the majority seems to suggest that debt negotiation, even in the context of a foreclosure, is presumptively the prac tice of law, I believe

that it errs. {¶ 30} Third, like it did in Watkins Global , this court has again suggested that legal opinions expressed by a nonattorney to an attorney c ount as the unauthorized practice of law. Whi le that may be correct in rar e instances, we ought to be cautious about reaching such a conclusion and not f orget the point of our rules, which is protect the public. One can reasonably pre sume that in most cases, attorneys can safely form their own views about the law and legal strategy,S UPREME C OURT OF O HIO

10 regardless of what opinions a nonattorney might express. In mo st cases, there will be little more reason to think that expressing a legal opi nion to an attorney is the practice of law than to think that expressing play-calling opinions to Woody Hayes is coaching football. {¶ 31} So, while I believe that Smidt vi olated our rules, elements of the majority’s analysis suggest an overly broad understanding of wh at might count as the unauthorized practice of law . For that reason, I concur in judgment only.

K ENNEDY , J., concurs in the foregoing opinion.

_________________ Joseph M. Caligiuri, Disciplinary Counsel, and Stacy Solochek B eckman, Assistant Disciplinary Counsel, for relator.

_________________