N.C. State Bar v. Livingston

257 N.C.App. 121

809 S.E.2d 183

The NORTH CAROLINA STATE BAR, Plaintiff

v.Christopher W. LIVINGSTON, Attorney, Defendant

No. COA17-277

Court of Appeals of North Carolina.

Filed: December 19, 2017

Deputy Counsel David R. Johnson and Counsel Katherine Jean, Raleigh, for plaintiff-appellee, The North Carolina State Bar.

Christopher W. Livingston, defendant-appellant pro se.

BRYANT, Judge.

Where the Disciplinary Hearing Commission's conclusions that Christopher W. Livingston violated the Rules of Professional Conduct are supported by the findings of fact which are in turn supported by the evidence, and where Livingston's conduct caused significant harm or potentially significant harm to the public, the profession, or the administration of justice, we affirm the order disciplining Livingston and imposing a five year suspension of a law license with an opportunity to petition for a stay after two years.

In March 2008, defendant Christopher W. Livingston, an attorney, entered into an agreement with a business known as Credit Collections Defense Network ("CCDN") to serve as an "Associate Attorney." In that position, Livingston agreed to accept referrals of debt-laden consumers from CCDN, which is not a law firm, whereby CCDN would collect fees from customers and convey a portion to Livingston for his legal services to those customers. Per the agreement, Livingston was responsible for "legal advice, litigation, filing of pleadings, discovery responses (if necessary), and ... cover[ing] court appearances (if necessary)" for CCDN's customers.

Around 20 April 2008, Livingston concluded that CCDN was engaged in the unauthorized practice of law by preparing court documents for CCDN's customers to file pro se . Livingston so advised CCDN through its representative, Colleen Lock, but did not terminate his relationship with CCDN. As such, CCDN continued to represent to North Carolina residents that CCDN was affiliated with licensed North Carolina lawyers, namely Livingston.

In September 2008, Livingston filed three lawsuits against CCDN (respectively, "Lawsuits 1, 2, and 3") in Bladen County District Court on behalf of three CCDN customers—William Harrison, Sheryl Lucas, and Cathy Hunt—alleging fraud, unfair and deceptive trade practices, gross and willful legal malpractice, and violations of both the North Carolina and federal Racketeer Influenced and Corrupt Organizations Acts ("RICO"). Livingston named a number of individuals and out-of-state business entities, including Robert Lock, Philip Manger, and R.K. Lock & Associates d/b/a "CCDN," but did not name the legal entity "CCDN, LLC" as a defendant. After making appearances to challenge personal jurisdiction over the named defendants, counsel for CCDN informed Livingston that CCDN was a limited liability company organized in Nevada. Livingston confirmed that fact but did not amend the complaints he had filed.

On 7 January 2009, while Lawsuits 1, 2, and 3 were still pending, Livingston filed another lawsuit ("Lawsuit 4") in Bladen County Superior Court against many of the same individual named defendants. Lawsuit 4 also named CCDN, LLC as a defendant. Livingston framed Lawsuit 4 as a class action and named an individual plaintiff, Sharon Southwood, as the class representative.¹ In a motion to certify the class, Livingston stated that he would not provide notice to class members as required by law. No class was ever certified.

In May 2009, the trial court dismissed Lawsuits 1, 2, and 3 for failure to name a necessary party—CCDN, LLC—and for lack of personal jurisdiction over the remaining defendants. The trial court concluded that none of the individual defendants had sufficient minimum contacts for personal jurisdiction before a North Carolina court. See Lucas v. R.K. Lock & Assocs. , Nos. COA10–874, COA10-875, COA10-891, 2011 WL 721289, at **5–6 (N.C. Ct. App. Mar. 1, 2011) (unpublished), rev. denied , 365 N.C. 347, 719 S.E.2d 17 (2011).²

On 11 November 2009, Livingston commenced a RICO class action against CCDN and other named defendants in U.S. District Court for the Eastern District of North Carolina ("Lawsuit 5"). On or about 17 November 2009, Livingston contacted a South Carolina attorney, Andrew Arnold, who was representing CCDN in South Carolina litigation. Livingston left Arnold a voicemail message stating that he represented a "national class" in his suit, that Arnold had participated in a money laundering scheme by accepting legal fees from CCDN, and demanded that Arnold forfeit to Livingston all fees he had received from CCDN. Livingston also threatened to join Arnold in Lawsuit 5.

A week later, Livingston filed an amended complaint in Lawsuit 5, adding Arnold, Arnold's firm, the North Carolina lawyer who represented CCDN in Lawsuits 1–4 (Lee Bettis), Bettis's firm, and individual members of Bettis's firm who had not participated in representing CCDN. Livingston accused the lawyers and their firms of having knowledge of their clients' fraudulent conduct and participating in the fraud by accepting legal fees and representing CCDN clients. The federal court later dismissed the aforementioned lawyers and their firms from Lawsuit 5 as Livingston had no basis in law or fact to sue them. See Taylor v. Bettis , 976 F.Supp.2d 721, 733–34, 736–39, 741–42, 745–47, 752–54 (E.D.N.C. 2013) (denying defendants' motion to dismiss but finding for defendants on their motion for judgment on the pleadings and dismissing plaintiffs' claims).

While Lawsuit 5 was still pending, on 7 January 2011, Livingston filed Lawsuit 6 in Columbus County Superior Court against the North Carolina attorneys on substantially the same underlying facts as alleged in Lawsuit 5. By email, Livingston informed Philip Collins, opposing counsel for the North Carolina attorneys in Lawsuit 6, that he planned to file suits against them each month for the remainder of the year. On 22 February 2011, the Columbus County Superior Court dismissed Lawsuit 6, which dismissal was affirmed by this Court. Cullen v. Emanuel & Dunn, PLLC , No. COA11-921, 2012 WL 3573696, at *3, *11 (N.C. Ct. App. Aug. 21, 2012) (unpublished).

On 10 April 2015, the North Carolina State Bar filed a complaint with the Disciplinary Hearing Commission (the "DHC") against Livingston alleging attorney misconduct in violation of the North Carolina Rules of Professional Conduct ("RPC"). Livingston filed his answer on 4 May 2015.

A hearing was held before the DHC from 17 to 20 May 2016. On 14 July 2016, the DHC entered its Order of Discipline suspending Livingston's law license for five years with the possibility of a stay after two years. On 5 August 2016, Livingston filed notice of appeal from the Order of Discipline and other orders entered against him.³

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On appeal, Livingston argues the DHC (I) violated his due process and equal protection rights; (II) erroneously found RPC violations; and (III) ordered excessive discipline.

I

Livingston first argues the DHC violated his due process and equal protection rights, arguing that he received "no meaningful evidentiary hearing." Specifically, Livingston argues the DHC took an insufficient amount of time to consider the evidence presented, the State Bar engaged in prosecutorial misconduct, and the findings of fact in the DHC's order are vague. We disagree.

"The standard of review for alleged violations of constitutional rights is de novo ." State v. Graham , 200 N.C. App. 204, 214, 683 S.E.2d 437, 444 (2009) (citation omitted). However, "a constitutional question which is not raised and passed upon in the trial court will not ordinarily be considered on appeal." State v. Hunter , 305 N.C. 106, 112, 286 S.E.2d 535, 539 (1982) (citations omitted).

To the extent Livingston makes a constitutional challenge for the first time on appeal, he contends he received "no meaningful evidentiary hearing, violating his Fourteenth Amendment due process and equal protection and N.C. Const. Art. I § 19 Law-of-the-Land rights[.]" We briefly address this argument.

Based on our thorough review of the record in this case, we are satisfied that "the DHC conducted a fair and unbiased process that fully comported with the principles of due process." See N.C. State Bar v. Sutton , ––– N.C. App. ––––, ––––, 791 S.E.2d 881, 891 (2016), appeal dismissed , 369 N.C. 534, 797 S.E.2d 296 (2017). Due process was satisfied where Livingston was given notice of the allegations against him, he filed an answer to the DHC's complaint, served discovery on the DHC, took depositions, attended the trial, examined witnesses, and made arguments before the DHC, availing himself of a full and fair opportunity to participate. See N.C. State Bar v. Braswell , 67 N.C. App. 456, 458, 313 S.E.2d 272, 274 (1984) ("The filing of a formal complaint satisfies [a] defendant's right to be informed of and respond to the charges against him."). Contrary to Livingston's argument, due process does not require the DHC to deliberate for any prescribed length of time. Livingston also alleges the State Bar engaged in prosecutorial misconduct by failing to correct false testimony given by Bettis. But Livingston is unable to show that Bettis's testimony was false, and is therefore unable to sustain a claim of prosecutorial misconduct based on "failure to correct false testimony." Finally, as set forth in Section II, infra , the findings of fact in the Order of Discipline are not vague. Indeed, the DHC "ruled on numerous motions filed by [Livingston] and issued orders containing detailed findings of fact and conclusions of law. Therefore, the record belies [Livingston's] assertion that he was denied due process in connection with his disciplinary proceeding." Sutton , ––– N.C. App. at ––––, 791 S.E.2d at 891. Accordingly, Livingston's argument that the DHC violated his due process and equal protection rights, as well as his N.C. Constitutional rights, is overruled.

II

Livingston next argues the DHC erroneously found that he violated the Rules of...