Court Opinion

ID: 9954378
Source: CourtListenerOpinion
Date Created: 2024-03-26 00:02:00.881145+00
Date Added: 2024-06-11T08:12:07.021347
License: Public Domain

Case: 23-30671            Document: 44-1         Page: 1      Date Filed: 03/25/2024

           United States Court of Appeals
                for the Fifth Circuit                                   United States Court of Appeals
                                                                                 Fifth Circuit
                                   ____________                                FILED
                                                                         March 25, 2024
                                     No. 23-30671
                                                                          Lyle W. Cayce
                                   ____________
                                                                               Clerk

Claude F. Reynaud, III,

                                                                                 Appellant.
                   ______________________________

                   Appeal from the United States District Court
                      for the Western District of Louisiana
                             USDC No. 3:23-MC-62
                   ______________________________

Before King, Ho, and Engelhardt, Circuit Judges.
Per Curiam:*
       The district court suspended Plaintiff Claude F. Reynaud, III from
practicing law in the Western District of Louisiana for ninety days due to
attorney misconduct. The court subsequently extended his suspension for
an additional nine months.
       We find that, in extending the suspension for nine more months, the
district court failed to comply with Local Rule 83.2.10(B)(3). Had the district
court complied with the Local Rule, the suspension would have been
consistent with the requirements of due process. Accordingly, on remand,
the court may re-issue the sanction in compliance with the Local Rule, if it
wishes to do so.

       _____________________
       *
           This opinion is not designated for publication. See 5th Cir. R. 47.5.
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                                 No. 23-30671

                                     ***
       Reynaud was an attorney at McClenny Moseley & Associates PLLC.
MMA had planned to file its Hurricane Laura and Delta claims collectively
in about a hundred lawsuits using permissive joinder, but the district court
rejected the filings and instructed MMA to file for each plaintiff separately.
Reynaud’s supervisor, William Huye, thus urgently asked Reynaud and other
MMA attorneys to provide access to their PACER accounts so that MMA
could timely file the complaints before the claims prescribed. Reynaud
agreed to do so.
       In February 2023, the Louisiana Department of Insurance issued a
“cease and desist” letter to MMA. Reynaud soon learned of MMA’s
misrepresentations in the filings and began planning his departure from the
firm. In March 2023, the district court suspended Reynaud and other MMA
attorneys from practicing law in the Western District of Louisiana for ninety
days, the maximum allowable sanction that an Article III judge could impose
on an attorney without the approval of other Article III judges or the Chief
Judge. Local Rule 83.2.10(B)(2). In its order, the district court identified
several misconduct concerns, including “poor client communication, use of
legal marketing program Velawcity, and failure to properly document its
expenses for settlement approval.”
       In June 2023, the district court extended the suspensions after
obtaining the unanimous vote of the Article III judges of the Western District
of Louisiana. Reynaud’s suspension was extended for an additional nine
months. The district court also gave the MMA attorneys the opportunity to
request individual hearings about the suspensions within fifteen days of the
order. Reynaud and the other MMA attorneys timely requested individual
hearings. Prior to the hearings, the district court instructed the MMA
attorneys to produce information on MMA’s IOLTA account. Reynaud

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testified on his behalf at his hearing, but the district court did not find just
cause to reduce his suspension.
       We review a district court’s decision to impose sanctions against an
attorney for abuse of discretion. United States v. Brown, 72 F.3d 25, 28 (5th
Cir. 1995). The decision is an abuse of discretion if it is based on an
“erroneous view of the law or on a clearly erroneous assessment of the
evidence.” Chaves v. M/V Medina Star, 47 F.3d 153, 156 (5th Cir. 1995).
       On appeal, Reynaud presents two arguments against the district
court’s decision to extend Reynaud’s suspension. We address each of the
arguments below.
       First, Reynaud argues that the district court deviated from the
procedures set out in Local Rule 83.2.10(B)(3) and related principles set forth
in Fifth Circuit precedent. Specifically, Reynaud contends that the district
court violated Local Rule 83.2.10(B)(3) by failing to conduct a hearing prior
to conducting the Article III judges’ vote. We agree.
       Local Rule 83.2.10(B) outlines the rules of disciplinary action. As
mentioned above, an Article III judge may impose a maximum suspension of
ninety days without the approval of other Article III judges or the Chief Judge
of the court. Local Rule 83.2.10(B)(2). To impose suspensions exceeding
ninety days, the Local Rules require the following: (1) the judge must refer
the suspension to the Chief Judge or the Chief Judge’s Article III designee to
investigate and determine a recommended action; (2) notice and an
opportunity to be heard then must be provided to the attorney; (3) the Chief
Judge or the designee then presents its recommendation to the Article III
judges of the court; and (4) a majority vote is needed on the recommended
action at a general or special meeting or by email vote.           Local Rule
83.2.10(B)(3).

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       “When a court undertakes to sanction an attorney for violating court
rules, it is incumbent upon the sanctioning court to observe scrupulously its
own rules of disciplinary procedure.” In re Thalheim, 853 F.2d 383, 390 (5th
Cir. 1988).    Because attorney suspension cases are “quasi-criminal in
character,” if there is any ambiguity, it should be resolved in favor of the
attorney charged. Id. at 388. But the Local Rules here are unambiguous. The
Local Rules state that the Chief Judge or the Chief Judge’s designee shall
present its recommended action to the Article III judges and conduct the
vote, but only “after notice to the attorney and an opportunity to be heard.”
Local Rule 83.2.10(B)(3). The district court in this case issued its June 8,
2023 order to extend Reynaud’s suspension without the opportunity for a
hearing but after obtaining the approval of the other judges. And “unless and
until [an] amendment [of the Rules] occurs, attorneys have the right to rely
upon the rules.” Thalheim, 853 F.2d at 390.
       Therefore, we find that the district court’s decision improperly
deviated from the Local Rules, which in turn, conflicts with this court’s
precedent in Matter of Thalheim. Accordingly, the nine-month extended
suspension was procedurally invalid because of the district court’s erroneous
view of the law. Id.
       Reynaud additionally challenges his suspension on the ground that,
even if the district court had complied with the Local Rule, his suspension
violated due process. We disagree.
       Reynaud claims that, because the district court continuously grouped
him together with the “other MMA attorneys,” he did not have adequate
notice of the specific allegations against him. While Reynaud recognizes that
his PACER credentials were used to file faulty complaints, he argues that he
could not “glean with certainty the basis for the district court’s refusal to lift

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the nine-month suspension imposed following the expiration of the original,
90-day suspension.”
         Due process requires notice and a meaningful opportunity to be heard.
Mathews v. Eldridge, 424 U.S. 319, 333 (1976). In attorney disciplinary
settings, due process rarely requires any more than this. See Sealed Appellant
1 v. Sealed Appellee 1, 211 F.3d 252, 254 (5th Cir. 2000). While the district
court misapplied its Local Rules, the record does not support that the district
court deprived Reynaud due process in the disciplinary proceedings. The
district court did give Reynaud notice and the opportunity to request an
individual hearing regarding the suspension within 15 days of the June 8, 2023
order.
         The hearing transcript reveals several instances where the district
court identified and attributed specific allegations against Reynaud. For
example, the court noted that Reynaud contributed to the firm’s client
communication issues.        It concluded that Reynaud “basically . . . sent
[clients] into the abyss because most people got no answers,” and that his
office functioned as a “call center” for the firm.             Hearing Tr. at
99:23−100:10.
         The court also noted that Reynaud failed his “duty as an officer of this
court” by acquiescing in Huye’s legal strategies.              Hearing Tr. at
103:18−104:14; see Hearing Tr. 118:8−118:17 (“And I guess I have a hard time
understanding how you-all are there involved and y’all don’t see it . . . . I’m
grasping with trying to understand how y’all all are saying we didn’t
know . . . . And from you in particular because you’re a little more
experienced . . . .”). The court insisted that, with his experience, Reynaud
should have known that “there’s no way that you c[ould] file permissive
joinder in federal court on a hurricane lawsuit. . . . [Reynaud] should have put
[his] foot down.” Hearing Tr. at 104:4−14. The court also mentioned several

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other occasions where Reynaud looked the other way and failed to act when
there was substantial likelihood of legal or ethical violations. See, e.g.,
Hearing Tr. at 113:1−114:15 (failed to act despite evidence of forged checks);
Hearing Tr. at 114:22−116:13 (failed to act despite evidence of incompliant
trust account).
       The district court considered Reynaud’s testimonial evidence but
ultimately concluded that the extended suspension was justified.         The
hearing transcript indicates that Reynaud had adequate notice of the
allegations brought against him and that he had a meaningful opportunity to
be heard. Thus, we find that the district court did not commit a due process
violation against Reynaud.
                                    ***
       If the district court wishes to extend Reynaud’s suspension for an
additional nine months, it may do so on remand, in accordance with the Local
Rules. For the reasons stated above, we remand the sanctions imposed on
Plaintiff.

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