Improper Litigation Management and Improper Oversight of an Inexperienced Subordinate Attorney Warrant Discipline.
Practicing automobile lemon law can be a high volume and financially rewarding practice. Applicable fee shifting statutes in many jurisdictions provide an incentive for automotive manufacturers to settle with disgruntled consumers. In the experience of Pennsylvania lemon law firm Kimmel & Silverman P.C., around 99% of their cases settle. K & S is organized into various teams that are supervised by a firm partner or a senior attorney. All appearances point to the K& S way as a lucrative and efficient business model.
The K & S website, http://www.lemonlaw.com, suggests a thriving firm with offices in several states: Pennsylvania (both Eastern and Western); New Jersey; Delaware; Massachusetts; Ohio; New Hampshire; Vermont; and Connecticut. The site provides:
We are the only lemon law firm in the Nation to be honored by the American Bar Association. Since 1997, we have worked first hand with government officials in a continuing effort to strengthen consumer statutes….CALL 1-800-LEMON LAW...Participate in the LEMONLAW BLOG!
As a public service, the K & S website provides links to attorneys who handle lemon law matters in states where K & S has no presence. Most of those links are to private firms. A few links are to state agencies.
If you are driving a lousy vehicle in the State of Maryland, K & S offers this referring advice: “No law firm available. Please see the consumer protection division of the Office of the Attorney General for Maryland.” K & S even gives you a link. But it wasn’t always this way. The Maryland Attorney General’s consumer protection division makes a statement on its webpage which gives you a good idea that Maryland drives at Lemon Law problems from a different direction than many other jurisdictions. “The Consumer Protection Division provides mediation services to consumers to help resolve complaints against businesses and health insurance carriers.” K & S’s lack of knowledge about Maryland’s predilection for mediation as part of that state’s consumer law contributed to a bitter experience for the firm.
K & S partners Craig Kimmel and Robert Silverman saw gold in the lemons of Maryland. They hired a young Maryland attorney to open a K & S branch in Owings Mills, Maryland. However, when they were handed lemons, they made something other than lemonade due to shortfalls in the supervision of someone who proved to be a relatively inexperienced attorney and who had poor client communication skills. As a result, the Maryland Attorney Grievance Disciplinary Commission asserted its authority over Kimmel and Silverman were both licensed in Pennsylvania and New York, but not Maryland. Maryland Rules of Professional Conduct (MRPC) 8.5 (a)(2)(i) and (iii) gave the Commission, however, the juice to proceed. A lawyer not admitted in Maryland is subject to disciplinary authority in Maryland if he or she provides or offers legal services in the state or if they have an obligation to supervise or control another lawyer practicing in Maryland whose conduct violates the MRPC.
The Commission charged both Respondents with failing to supervise adequately the Maryland associate employed by the K & S (MRPC 5.1) and failure to properly communicate with a Maryland client of the firm (MRPC 1.4).
It turns out that K & S considered associating with a Maryland practitioner with experience in lemon law, but they were unable to find a suitable lawyer. Instead, they hired Robin Katz to open the new office. She got the job via a web posting by submitting a cover letter and resume. She interviewed with Robert Rapkin (with K & S since 2001) who leads a team of lawyers, paralegals and other staff at K & S. Katz was admitted in Maryland in 1996. From 1996 to 2003, she handled social security disability cases in a non-adversarial law setting. She had no civil trial experience. She did however have experience with handling a high volume of cases and this was a primary factor in her getting of the job. Rapkin described Katz as seemingly competent and well organized. Rapkin did not know Katz had never handled a contested matter.
Katz received training with K & S that was held over the course of a month in their Ambler, Pennsylvania office. Rapkin took the young lawyer with him to a couple of depositions and arbitrations. He helped her develop Maryland forms for basic pleadings. She was trained on the firm method of preparing and evaluating cases. She met most of K & S’s lawyers and staff and spent time with Kimmel and Silverman. The K & S office manager trained Katz on the K & S case management system. Katz returned to Maryland after her training and procured office space in Owings Mills. She was responsible for her own clerical work. K & S had started to accept Maryland cases while Katz was in training. She was responsible for about 50 cases when the office opened. She was led to believe K & S would hire a paralegal when the caseload was sufficient. Katz remained at K & S for thirteen months.
She learned soon after her hire that the firm runs a volume practice in a numbers driven environment. Starting in early September, K & S gave Katz a weekly benchmark for complaints to be filed. She was expected to file 10 complaints a week. By January 2005 that figure rose to 15. She also was given a target of $10,000 per week in revenue from settlements. This goal was outlined as a major consideration to be considered in her job performance reviews. Katz never consistently met her performance benchmarks. K & S initiated no adverse action against her, but the firm leadership insisted that she do more..
Rapkin pressured Katz to meet revenue expectations in a series of e-mail communications. In one e-mail, Rapkin told Katz, in relevant part, “Let me make it clear…you must make your number…The number you have is not set for fun…Your number is the most important way we judge how to give raises, whether we can find support staff…and as a practical matter if all your cases come up for trial at the same time you won’t be able to handle them…no excuses…no need to talk…call me with positive news of settlements or demands…” At the time of this e-mail, Katz had settled 1 case in the previous 2 weeks and had a caseload of 224 cases. She received criticism rather than support and instruction.
At some point, Kimmel personally assumed supervisory responsibility over Katz. He kept the pressure on. Silverman e-mailed Katz that she was not settling cases with manufacturers other than Ford and Chrysler. He directed her to send 10 substantive, non-form letters per week to opposing counsel. To push cases towards settlement, Katz started sending out 30 of these letters a week with copies forwarded to Kimmel. Later, Kimmel e-mailed Katz and questioned the fees generated in her settlements, which were almost always $2500 per case. He suggested she review the files individually for .5 to 1.0 hours and this would add to her overall fees. Katz had 200-300 cases that would require this type of review if she followed such a directive. Kimmel said she could use paralegal support from the Ambler office. This wasn’t always a smooth process. The firm used the Pennsylvania address on filings so pleadings were mailed there. This put additional pressure on Katz to respond to pleadings in a timely and efficient fashion. Katz asked the office manager if she was going to get a paralegal for the Maryland office. The office manager said she needed to file 15 complaints a week to earn that help. She even asked Silverman about hiring a Maryland paralegal. She received no relief.
Katz’s caseload steadily increased during her tenure. By September 2004, she had 127 cases, 45 in suit. By November, she had 203 cases, around 100 in suit. Between September 2004 and August 2005, she filed 461 suits in Maryland. She was assigned over 500 total matters. Most senior attorneys at K & S handled around 1000 case assignments with the assistance of paralegals.
Katz’s workload increased in other areas. Because Maryland did not require early arbitration, as was the case in other jurisdictions where K & S had offices, Katz had a high volume of cases in active discovery. Also, because of different arbitration rules, Katz had to handle a steady stream of motions and court appearances. She also had motions in court houses across Maryland. Katz managed to meet the increasingly onerous demands on her time with one big omission. During the latter half of her tenure at K & S, she failed to respond to motions compelling discovery in forty-seven cases. These were all Nissan or Toyota cases which were aggressively litigated by the law firm Piper Rudnick. All of those cases were dismissed with prejudice. Katz prioritized putting cases to suit and pushing for settlement instead of managing overdue discovery and motion responses. She seemed genuinely unaware that matters could be dismissed because of discovery lapses. She was afraid to disclose her lapses to Kimmel or Silverman because she believed her job was on the line. She covered up her neglect by forwarding to Kimmel copies of at least 10 letters she purportedly sent to opposing counsel in cases she knew had been dismissed. In one matter, the Iweala case, she told Silverman she believed the dismissed case could be reinstated. He was reassured. The case could not be reinstated. Silverman believed the Iweala matter’s handling was an isolated mistake. By July 2005, Katz was totally overwhelmed. She was depressed and crying all the time. She lost 20 pounds. She resigned by email on August 10, 2005. Later, she consented to disbarment in Maryland as a sanction for her conduct.
On the day of her resignation, Silverman drove to the Maryland office. This was his first visit ever to the branch office. He was immediately concerned by stacks of documents that were not filed. K & S immediately hired three Maryland lawyers and the cases were reassigned in a 2-4 week period. K & S no longer has a Maryland office.
The Court ruled that the Pennsylvania partners did not properly supervise Katz given her level of experience. The Court also ruled that the lawyers did not ascertain the differences in the Maryland lemon law and automotive warranty law from that of Pennsylvania and other states where K & S did business in order to determine how these differences would impact how K & S organized and conducted its practice. Mitigating these breaches was the effective response of K & S when it learned of the professional and ethical failings of its Maryland office.
The Court noted that “basic familiarity with Maryland law and practice would have highlighted differences in fee shifting and settlement provisions.” It was disappointed that basic research and analysis of Maryland law was not performed by K & S before they opened a Maryland office. This lack of knowledge of the law adversely affected the structuring of attorney supervisory procedures. The Court saw that supervision and training cannot consist merely of written and verbal reminders of quotas and exhortations to “work harder”. K & S gave Katz no assistance that her ethics and professionalism were not lost in the firm’s focus on profit and income goals.
Bar Counsel recommended an indefinite suspension for both Kimmel and Silverman. Kimmel and Silverman urged that, at most, they be reprimanded. A hearing judge recognized the mitigating effect of the damage control efforts of Kimmel and Silverman. Only one Maryland client ever asserted that there was a failure to adequately communicate and that client was fully satisfied in the end with his settlement. The Court was not unmindful of the influence that its disposition would have in reciprocal discipline cases in other jurisdictions.
The Court imposed an indefinite suspension, largely because of the effective recovery efforts by K & S. Both lawyers will have the right to apply for reinstatement in no sooner than 90 days after the effective date of the suspension. The Court said “the purpose of protecting Maryland citizens does not seem well-served by a “greater minimum sit-out period.”
Two justices dissented suggesting that Kimmel and Silverman’s mismanagement destroyed Katz’ career and was an aggravating factor. The dissent believed that other attorneys who engaged in similar ethics violations involving subordinate and litigation management received greater punishment and that Kimmel and Silverman deserved an indefinite suspension for much longer than 90 days.
The cases are: Attorney Grievance Commission of Maryland v. Craig Kimmel, Misc. Docket AG No. 20, September Term, 2007 (Maryland September 2, 2008) and Attorney Grievance Commission of Maryland v. Robert Silverman, Misc. Docket AG No. 21, September Term, 2007 (Maryland September 2, 2008).
-RICHARD S. THOMAS, COUNSEL, ILLINOIS ARDC-