The Consequences for Attorneys Who “Knowingly” or “Negligently” Engaging in Improper Billing

Whenever I do a seminar for attorneys on ethics, I always tell them that there are three things they should especially avoid doing: drugs, sex with a client, and messing with a client’s money.  I tell them that if they are caught doing one of these three things, they will find that harsher discipline will be imposed on them.

I know harsher discipline is meted out to attorneys who improperly bill from following lawyer disciplinary cases and from reading the ABA Standards of Imposing Lawyer Sanctions. These ABA Standards are what state disciplinary authorities tend to follow when meeting out lawyer discipline for violating the RPC. Think of the ABA Standards as being like the Federal sentencing guidelines which Federal judges follow when imposing sentences in Federal court.

If you read the ABA Standards, you will see that harsher penalties, such as disbarment or suspension, are called for when an attorney “knowingly” improperly bills a client. See, e.g., In re Disciplinary Proceeding against Vanderbeek, 101P.3d 88 (Wash. 2004)(disbarment for bill padding).

Note that the higher standard of discipline applies not only to how attorneys bill fees, but can also apply to how they bill for expenses. Recall that Clinton pal and former Deputy Attorney General Webster Hubbell was permanently disbarred in Arkansas for overbilling both his clients and his law firm for expenses. Also see In re Mitchell, 2014 WL 1800065, (La., 2014)(attorney permanently disbarred with no opportunity for reinstatement for billing both client and law firm for expenses).

But what if an attorney is only “negligent” in improperly billing a client? Even if the attorney is only negligent, the ABA Standards still provide that discipline in the form of a reprimand or admonition is appropriate.

Although a reprimand sounds like a benign “once and done” type of a discipline, it could have long lasting adverse consequences. This is because public reprimands are reported as cases just like other types of judicial cases.  See, e.g., In Re Daniel G. Areaux, 823 N.E.2d 1192, 1193 (Ind. 2005)(“The respondent violated Indiana Professional Conduct Rules 1.4(a) and 1.4(b) by failing to keep his client reasonably informed of her escalating attorney fees owed to the respondent and Baker & Daniels.”).

Since disciplinary cases are reported cases, this means that for years to come,  prospective clients who Google the attorney’s name will discover that the attorney has been disciplined in a case involving legal fee billing. This certainly cannot be good for business. As I tell attorneys in my ethics seminars, “You never want people to see an ‘In re’ before your name in a case unless you are dead and the case is about your estate