Don’t Do This If You Are Out-of-State Counsel Appearing in The NC Business Court

By Mack Sperling on July 3, 2018

The title of Judge Bledsoe’s Opinion in Carolina Home Solutions 1, Inc. v. Crystal Home Solutions, Inc., 2018 NCBC 57, is ominous in itself. It is titled “Order and Opinion Denying Pro Hac Vice Admission and Referral to the Georgia and North Carolina State Bars.”

How hard is it to get a pro hac vice (PHV) admission in the Business Court? Not very. You just have to comply with N.C. Gen. Stat. §84-4.1. Who even gets denied pro hac admission to the Business Court? (It happens. Judge McGuire once revoked the previously granted pro hac admission of a lawyer and barred him from practicing in North Carolina for two years. Judge Jolly once refused to admit a lawyer for the University of Maryland on a pro hac basis because of a conflict of interest.) And what does one have to do that is so bad that they are referred to two separate state bars?

The attorney in question, trying to represent the Plaintiff and its President, is admitted in Georgia, not North Carolina. He was not permitted to appear in any Court in North Carolina without being admitted PHV. He was aware of this, because Judge Bledsoe warned him on multiple occasions.

I don’t think that I have ever criticized any lawyer by name on my blog for violating the Business Court Rules or for doing something stupid, and I won’t start now. If you want to know the name of the lawyer who is the subject of this Opinion, you’ll have to look at the Opinion. I’ll just refer to him as “Mr. Georgia Lawyer.”

Judge Bledsoe said in a written Order in the case earlier this year:

(i) that “unless Plaintiff is represented by a duly admitted and licensed attorney-at-law at trial, Plaintiff will not be permitted to participate in the trial,” and (ii) that “[Mr. Georgia Lawyer] may not represent Plaintiff in this action unless Plaintiff and he promptly comply with the requirements of N.C. Gen. Stat. § 84-4.1, including, in particular, Plaintiff’s retention of counsel duly licensed in North Carolina with whom Mr. [Georgia Lawyer] will be personally appearing in this action.”

Op. ¶12.

Mr. Georgia Lawyer did not immediately comply with the Court’s direction. Though he did represent to the Court, via email, that he would associate with NC counsel and would file a Motion for pro hac admission the next day. But he didn’t.

Meanwhile, pretrial deadlines were approaching. One of the parties that Mr. Georgia Lawyer was supposed to represent went ahead and filed its portion of the Pretrial Order, signed by its President, not a lawyer. The President also signed off on a trial brief.

Both the Pretrial Order and the Trial Brief appeared to Judge Bledsoe to have been prepared by a lawyer. I have looked at the Trial Brief. It might have been prepared by a lawyer, but if it was, it’s not a very impressive piece of work.

What difference does it make who prepared it? The answer is that if it was “ghostwritten” by Mr. Georgia Lawyer, that would be the unauthorized practice of law.

Ghostwriting

Ghostwriting is worth a few words. First, an attorney licensed in North Carolina can draft documents on behalf of a pro se party without appearing in the case. Op. ¶22. But an out-of-state lawyer can’t do that unless she complies with pro hac admission procedures. Id.

If Mr. Georgia Lawyer drafted documents for his client to sign off on, he was engaging in the unauthorized practice of law. So? Well that is a Class 1 misdemeanor in North Carolina. Op. ¶24. How serious is a Class 1 misdemeanor in North Carolina? I wondered, and finding the answer took a took a little bit of searching. North Carolina has four classes of misdemeanors: Class 1A, 1, 2, and 3. N.C. Gen. Stat. §15A-1340.23. If Mr. Georgia Lawyer has no prior misdemeanors on his record, he faces 45 days of community service plus a fine in an amount to be determined in the discretion of the Court. That penalty, if it is ever imposed, will be handed out by a state District Court Judge, not a Business Court Judge.