Before: Cabranes, Sack, and Wesley, Circuit Judges.
Kristan Peters, an attorney admitted to the bars of both New York and Connecticut,*fn1 and formerly a partner at the law firm of Dorsey & Whitney, appeals from an order of the Committee on Grievances for the United States District Court for the Southern District of New York (the "Grievance Committee") suspending her from practicing before that court for a period of seven years. The Grievance Committee found that she had engaged in the following misconduct:
(1) instructing a junior attorney, Jordan Brackett, to deface transcripts in order to render them, under the guise of the attorney work-product privilege, unreturnable to the district court ("the Brackett allegation"); and
(2) violating a confidentiality order issued by the district court by filing, in a Massachusetts action, transcript excerpts encompassed by that order("the Confidentiality Order allegation").*fn2
See In re Peters, 543 F. Supp. 2d 326, 331-34 (S.D.N.Y. 2008) (interim suspension order); In re Peters, M-2-238, doc. 125 at 3-4 (S.D.N.Y. Jun. 5, 2009)(disbarrment order, based on the findings and reasoning of the interim suspension order); In re Peters, M-2-238, doc. 192 at 5 (S.D.N.Y. Aug. 6, 2009)(order reducing penalty from disbarrment to seven-year suspension, based on mitigating factors).
The Grievance Committee concluded that Peters's misconduct had violated: New York Disciplinary Rule ("DR") 1-102(a)(5), which prohibited conduct prejudicial to the administration of justice; DR 1-102(A)(4), which prohibited a lawyer from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation; and DR 7-106(A), which prohibited a lawyer from disregarding, or advising a client to disregard, a ruling of a tribunal made in the course of a proceeding.*fn3 See Peters, 543 F. Supp. 2d at 334-35; Peters, M-2- 238, doc. 125 at 4.
In her brief, Peters argues, inter alia, that the Grievance Committee's failure to hold an independent hearing, and its reliance on a prior sanctions hearing conducted by Judge Baer in the underlying litigation, violated her due process rights and the district court's local rules. She also argues that the two charges of misconduct now at issue do not, as a matter of law, support the Grievance Committee's imposition of discipline. Although this Court already has affirmed the underlying sanctions order entered by Judge Baer to the extent he reprimanded Peters, the two charges upon which the Grievance Committee's suspension is based were not addressed in that prior appeal, since this Court limited its review of Judge Baer's order to three other charges. See Wolters Kluwer Fin. Servs., Inc. v. Scivantage, 564 F.3d 110, 118-19 (2d Cir. 2009), affirming, in part, 525 F. Supp. 2d 448 (S.D.N.Y. 2007) (Judge Baer's sanctions decision). Except as discussed below, we assume the parties' familiarity with the underlying facts and procedural history of this case.
This Court's review of an original disciplinary order entered by a district court is governed by the abuse of discretion standard, although the issue of whether a disciplinary rule prohibits the conduct in question is reviewed de novo. See In re Edelstein, 214 F.3d 127, 130-31 (2d Cir. 2000). A district court has abused its discretion if its imposition of sanctions was based on "an erroneous view of the law or on a clearly erroneous assessment of the evidence," or "cannot be located within the range of permissible decisions." Wolters Kluwer, 564 F.3d at 113 (internal quotation marks omitted). However, "when the district court is accuser, fact finder and sentencing judge all in one," as was essentially the case here, this Court's review is "more exacting than under the ordinary abuse-of-discretion standard."*fn4 Id. at 113-14 (internal quotation marks omitted). Thus, even under the deferential abuse-of-discretion standard of review, this Court must be careful to "ensure that any [decision to impose sanctions] is made with restraint and discretion." Schlaifer Nance & Co. v. Estate of Warhol, 194 F.3d 323, 334 (2d Cir. 1999).
Because an attorney disciplinary proceeding is quasi-criminal in nature, the Due Process Clause entitles the charged attorney to, inter alia, adequate advance notice of the charges, and the opportunity to effectively respond to the charges and confront and cross-examine witnesses. See In re Ruffalo, 390 U.S. 544, 550-51 (1968); Erdmann v. Stevens, 458 F.2d 1205, 1209 (2d Cir. 1972) ("[A] court's disciplinary proceeding against a member of its bar is comparable to a criminal rather than to a civil proceeding.").
In examining the Grievance Committee's decision not to hold a full evidentiary hearing, this Court "consider[s] the private interest affected by the action of the [Grievance Committee] in following [Judge Baer's sanctions decision] without [holding] an [independent] evidentiary hearing, the risk of erroneous deprivation of that private interest, and the [Grievance Committee's] interest in foregoing an evidentiary hearing." In re Jacobs, 44 F.3d 84, 90 (2d Cir. 1994) (citing Mathews v. Eldridge, 424 U.S. 319, 335 (1976)). This Court has held that a district court grievance committee's decision not to hold a full evidentiary hearing did not violate the charged attorney's due process rights when the risk of erroneous deprivation of the attorney's interest in practicing before the district court was "extremely low," and there was an "important public interest in not expending judicial resources on a proceeding that would largely duplicate a prior . . . proceeding," given that the attorney "had made no showing that such a hearing would reveal an infirmity of proof or lack of due process in the [prior] proceeding or risk of grave injustice from suspending [the attorney] on the basis of [a prior] order." Id. at 90-91 (holding that a district court grievance committee's reliance on a state court's findings, without holding an independent hearing, did not violate the attorney's due process rights).
With respect to the Brackett allegation, an independent evidentiary hearing would not have been duplicative of Judge Baer's sanctions proceeding since, in that prior proceeding, Peters was not provided adequate prior notice of that allegation or adequate opportunity to respond and to cross-examine adverse witnesses. With respect to the Confidentiality Order allegation, although Peters had adequate notice and opportunity to respond to the allegation during the prior proceeding, the evidence concerning the allegation was not adequately developed during that prior proceeding so as to permit the Grievance Committee to forego an independent evidentiary hearing in the present matter. We therefore vacate the Grievance
Committee's suspension order and remand the matter for the Committee to hold further proceedings consistent with our decision.
A. Collateral Estoppel, Res Judicata, and Law of the Case
First, this Court never reviewed the particular charges on
which the Committee based its discipline. Instead, in the appeal
from Judge Baer's sanction order, this Court stated that it "need only
review a sampling of Peters's conduct to affirm the district court's
imposition of sanctions," and then discussed three charges not now at
issue. Wolters Kluwer, 564 F.3d at 116, 118-19. The Court then
concluded as follows:
Having reviewed these three instances, we see no need to consider the other sanctions for which the district court issued reprimands. No likely argument has been advanced as to why the other nineteen sanctions are defective, and because the sanctions are all non-monetary, the subtraction of one or another from the whole course of conduct would not alter the nature or tenor of the district court's rulings.
Id. at 119. Although the Court saw no "likely argument" concerning the sanctioned conduct presently at issue, the Court nonetheless made clear that appellate review had been limited to the sampling of conduct explicitly discussed in the opinion. We therefore disagree with the Grievance Committee's statements that "Judge Baer's conclusions regarding the incident involving Mr. Brackett . . . have been affirmed by the Second Circuit," In re Peters, M-2-238, doc. 193 at 5, and that "[t]he Second Circuit affirmed all of the sanctions on Ms. Peters," id. at 7. Thus, the Committee was incorrect to rely on such preclusion doctrines as collateral estoppel and res judicata in finding that it need not hold its own hearing. See Niagara Mohawk Power Corp. v. Tonawanda Band of Seneca Indians, 94 F.3d 747, 754 (2d Cir. 1996) ("It is a well-established principle of federal law that if an appellate court considers only one of a lower court's alternative bases for its holding, affirming the judgment without reaching the alternative bases, only the basis that is actually considered can have any preclusive effect in subsequent litigation."); Gelb v. Royal Globe Ins. Co., 798 F.2d 38, 45 (2d Cir. 1986) ("[I]f an appeal is taken and the appellate court affirms on one ground and disregards the other, there is no collateral estoppel as to the unreviewed ground."); Restatement (Second) of Judgments § 27 cmt. o (1982).
The Committee also relied on the law of the case doctrine in finding that it need not hold its own hearing. The law of the case doctrine, although not binding, "counsels a court against revisiting its prior rulings in subsequent stages of the same case absent 'cogent' and 'compelling' reasons," including, inter alia, "the need to correct a clear error or prevent manifest injustice." Ali v. Mukasey, 529 F.3d 478, 490 (2d Cir. 2008) (quoting United States v. Tenzer, 213 F.3d 34, 39 (2d Cir. 2000)). We need not address whether the present matter is the "same case" as Judge Baer's sanctions proceeding because, even assuming arguendo that the doctrine could apply, the present issues are sufficiently compelling to warrant revisiting the Brackett allegation. See id.
B. Notice and Opportunity to Respond
Second, this Court's due process analysis in Wolters Kluwer is of limited aid in the present appeal because the notice Peters received in Judge Baer's sanctions proceeding concerning the Brackett allegation, and her opportunity to respond, differed significantly from the notice and opportunity to respond she had concerning the three charges discussed in this Court's Wolters Kluwer decision. As an initial matter, the Brackett allegation was not included in the defendants' sanctions motion, see Peters's App. ("App.") at A68-A100, although Judge Baer noted in his sanctions order that he had "specifically reiterated at the beginning of the hearings that the [district court] was only considering the same issues raised by [the] sanctions motion," Wolters Kluwer, 525 F. Supp. 2d at 452 n.8; see also App. at A287 (Letter from Judge Baer, copied to all attorneys, concerning sanctions hearing) ("The scope of the hearing will encompass the relief requested by Defendants in their motion for contempt, sanctions, and fees.")), A374 (similar statement by Judge Baer at beginning of the hearing). While that description of the scope of the sanctions hearing may not be controlling, since an attorney may receive adequate notice of a misconduct charge by means other than a sanctions motion served prior to the sanctions hearing, see Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950) (explaining that due process requires only notice "of such nature as reasonably to convey the required information"), it does not appear, on the present record, that Peters received adequate notice of, and opportunity to respond to, the Brackett charge by any means.*fn5
The sanctions motion charged Peters with, inter alia, failing to deliver all deposition transcripts to the district court, in violation of Judge Baer's protective order, which required her firm to deliver all of the transcripts to him. See App. at A73, A82-85. Although the Brackett allegation was related to Peters's alleged intention to retain transcripts in violation of Judge Baer's order, the sanctions motion contained nothing that would suggest to a reasonable person that the Brackett allegation might be a basis for sanctions. There is a simple explanation for this: the sanctions motion was signed and served on April 24, 2007, see id. at A100; S.D.N.Y. Docket 07-cv-2352, Doc. 124, item 200 at 143 (Cert. of Service),*fn6 while the Brackett allegation concerned an event that occurred on April 26, 2007, see App. at A714-15 (Brackett Decl.).
The Brackett allegation did not surface during the sanctions proceeding until September 4, 2007, the third day of the five days of hearings before Judge Baer, when a witness testified that he had been told that Peters had directed Brackett to write "attorney notes" on clean copies of deposition transcripts. See id. at A657-59. However, the focus at that point remained whether the law firm or Peters had possessed transcripts that previously should have been delivered to the court. See generally id. at A655-72. In fact, Peters's cross-examination of that witness barely touched on his mention of the Brackett allegation -- in that regard, Peters simply asked if the witness had himself heard the conversation between Brackett and Peters, and whether the witness had participated in the decision not to call Brackett as a witness in the sanctions hearing, at which point Judge Baer stated, "We can fix that." Id. at A670. At that ...