March 23, 2009
Enjoining Bar Prosecution
The North Carolina Supreme Court remanded a case where an attorney had sued the North Carolina State Bar on a theory that it had acted vindictively in filed sequential actions against him. He had brought a section 1983 action and the Bar appealed after losing in the Court of Appeals. The court here remanded with instructions to dismiss claims of substantive due process violations with prejudice but to dismiss his claims that he had been denied procedural due process without prejudice.
Three complaints were filed by the Bar against the lawyer. Two were actions alleging ethics violations and the third sought reimbursement for claims paid to his clients by the Client Security Fund. The first disciplinary case resulted in a five-year suspension with the last three years stayed. The lawyer filed suit against the Bar when the second disciplinary matter was pending, alleging that the conduct at issue was known when the first case was filed. He claimed that the prosecution was retribution for his exercising rights in the first case.
The trial court eventually granted a TRO permanently enjoining prosecution of the second disciplinary case, which involved misappropriation charges. The Bar appealed and the Court of Appeals dismissed the appeal as an interlocutory order not affecting a substantial right. The Bar then appealed to the state Supreme Court.
The court here found the Bar suffered risk of injury and had the right to appeal. Further, the "theory of vindictive prosecution is limited to criminal cases" and could not be asserted against the Bar. However, the court concluded that the lawyer can pursue a properly pleaded claim that he was denied procedural due process and that he need not await the conclusion of the disciplinary proceeding to do so. The court disolved the permanent injunction ordered by the trial court.
Two dissenting justices would affirm on the view that the interlocutory order was not appealable.Justice Hudson opines: "The majority's holding here goes beyond our long-standing jurisprudence describing types of substantial rights, and possible impairment of those rights, that justify review of an interlocutory order. The course it sets potentially opens floodgates that should remain closed." Justice Hudson also would allow a theory of vindictive prosecution to proceed against an administrative agency such as the Bar. (Mike Frisch)
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