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Why Did Smith Hiatt & Diaz Have to Pay a $49,000 Fine?

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by Mike on September 3, 2010

Imagine a law firm so sloppy the court imposed a $49,000 fine on them. Well, you don’t have to imagine – Smith, Hiatt & Diaz got hit with that fine last week.

I promised you I’d post the court order as soon at it was released – and here it is: the order of contempt against Smith, Hiatt & Diaz. (PDF)

It starts off detailing numerous instances of sloppy, inconsiderate, thoughtless lawyering. Missed hearings, late cancellations, outright disregard of court orders. Approximately ten separate offenses appear in the order – I say “approximately” because there are so many episodes they actually all blur together. The order said:

Their disobedience of Court Orders is constant and flagrant, and, therefore, justifies this Court’s imposition of sanctions for contempt… the Law Firm’s noncompliance and disobedience was either intentional and deliberate or so grossly negligent that it rises to the level of willful misconduct.

The Court blasted firm partner Roy Diaz for implausible excuses and explanations. Diaz apparently claimed that Smith, Hiatt & Diaz had changed its procedures to fix its scheduling problems, but the Court wasn’t buying it:

On the very morning of the hearing on this matter, a plaintiff and an attorney from the Law Firm did not appear or properly cancel a scheduled hearing… the Law Firm’s newly implemented policies and procedures, therefore, do not provide this Court with an assurance of future compliance.

Translation: Roy Diaz is either lying or stupid.

The Court found Smith, Hiatt, and Diaz in contempt of court. It then, perhaps most humiliatingly, gave them homework:

“The Law Firm shall create effective internal policies and procedures… said policies shall be in writing and a copy forwarded to this Court within 30 days from the date of this Order.”

Smith, Hiatt, and Diaz lawyers and support staff are now required to submit written affirmations that they have read the local rules and policies of Manatee County courts and the “Guidelines for Professional Conduct as provided by the Florida Bar.”

Then, a forty-nine thousand dollar fine. (BAM!) On top of that, a $50 check to the defendant, who missed work to be at cancelled hearings, and attorneys’ fees to lawyers from a co-defendant. And the Court then hung a sword over the heads of the law firm and some of its lawyers, by “reserving jurisdiction for sixty days” (i.e., let me think about this and get back to you in two months…) on charges of indirect criminal contempt.

Translation: “I’m mad as hell and I’m not going to take it anymore.” This could, in theory, result in jail time for one or more of the lawyers involved.

I hear a court reporter was there and that Roy Diaz’s testimony deserved the scorn it got from the Court. I look forward to posting the transcript.


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