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Thompson Hine LLP, a full-service business law firm with approximately 400 lawyers in 11 offices, was ranked number 1 in the category “Most innovative North American law firms: New working models” by The Financial Times and was 1 of 7 firms shortlisted for The American Lawyer’s inaugural Legal Services Innovation Award. The firm has been recognized by the National Law Journal as a Legal Technology Trailblazer and featured by Bloomberg for its innovative service delivery models, which drive accuracy and predictability. The firm’s commitment to innovation is embodied in Thompson Hine SmartPaTHTM – a smarter way to work – predictable, efficient and aligned with client goals. For more information, please visit ThompsonHine.com and ThompsonHine.com/SmartPaTH.

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<img style="max-width: 100%;height: auto;max-width: 100%;height: auto" loading="lazy" class="alignright size-medium wp-image-4272" src="https://www.thelawforlawyerstoday.com/wp-content/uploads/sites/754/2019/02/E-mail-mouse-trap-300x212.jpg" alt="" width="300" height="212">Going abroad?&nbsp; Think that &ldquo;national counsel&rdquo; is going to take care of anything that comes up when you&rsquo;re gone?&nbsp; Get swamped when you return and take &ldquo;several weeks&rdquo; to wade through the e-mail that piled up in your absence?&nbsp; If you&rsquo;re local counsel, that might be a recipe for disaster &mdash; for your client &mdash; as the Seventh Circuit Court of Appeals <a href="http://filehost.thompsonhine.com/uploads/Seventh_Ave._Inc._v._Shaff_Int'l_Inc._0c63.pdf">held recently</a>.
What we have here is a failure to communicate
After the plaintiff filed a trademark infringement case, the Wisconsin district court&rsquo;s docket shows that just a month later the parties reached a deal and jointly moved to file a consent order resolving the dispute.&nbsp; But about four months after that, the plaintiff was back in court, moving for a contempt order and asserting that the defendant had violated the consent order.
Here&rsquo;s where things began to go south, according to the appeals court opinion:&nbsp; The defendant&rsquo;s local Milwaukee counsel received notice of the contempt motion, via the electronic docketing system (presumably PACER).&nbsp; When the lawyer failed to respond, the district court scheduled a hearing.&nbsp; No one showed up on behalf of the defendant.&nbsp; The district court then granted the plaintiff&rsquo;s motion, holding the lawyer in contempt, requiring his client to pay the plaintiff&rsquo;s fees and costs, and ordering the lawyer to explain his unresponsiveness.
As the court of appeals wrote, that order &ldquo;caught [the lawyer&rsquo;s] attention.&rdquo;&nbsp; Local counsel explained that he had been &ldquo;traveling internationally&rdquo; when the plaintiff filed its motion for contempt, and even though he returned five days before his client&rsquo;s response to that motion was due (and 26 days before the scheduled hearing), &ldquo;it took him several weeks to catch up on his email.&rdquo;&nbsp; He saw the court&rsquo;s notices only after &ldquo;all response dates had passed.&rdquo;
The defendant&rsquo;s request for reconsideration of the contempt order also pointed to what the appeals court called a &ldquo;communication breakdown between local counsel and the company&rsquo;s national trademark counsel.&rdquo;&nbsp; Local counsel believed national counsel would be &ldquo;attending to any ongoing needs in the case; national counsel apparently had a different understanding,&rdquo; the court wrote.
&ldquo;Deadlines matter&rdquo;
The result of this mess-up?&nbsp; The district court found the local counsel in contempt, and after a line-by-line analysis of the plaintiff&rsquo;s attorney fees and costs for the entire case &mdash; not just the contempt proceedings &mdash; sanctioned the defendant&nbsp;to the tune of almost $35,000.&nbsp; The Seventh Circuit easily upheld those rulings, characterizing the whole situation as &ldquo;unfortunate and avoidable.&rdquo;
&ldquo;Deadlines matter,&rdquo; wrote the court, and certainly after the district court provided a second chance to the defendant by noticing a hearing, the lower court&rsquo;s reaction in issuing its contempt order was not an abuse of discretion.&nbsp; Nor did the defendant&rsquo;s good faith provide any immunity from sanction, the appeals court said.
And the big take-away:&nbsp; &ldquo;Nor, of course, can communication breakdowns serve to exempt outside counsel ... from compliance with the rules, or from the penalties for failing to do so.&rdquo;
Beware local counsel duties &mdash; and check your e-mail
We&rsquo;ve written before about <a href="https://www.thelawforlawyerstoday.com/2015/11/want-to-be-local-counsel-youd-better-define-your-duties/">local counsel duties</a>. and a New York City Bar <a href="https://www.nycbar.org/member-and-career-services/committees/reports-listing/reports/detail/formal-opinion-2015-4-duties-of-local-counsel">ethics opinion</a> that is a helpful cautionary road map on local counsel duties.&nbsp; The bottom line is that you don&rsquo;t get any free pass for being &ldquo;merely&rdquo; local counsel.&nbsp; The extent of local counsel&rsquo;s role in any particular matter should be expressly set out in a carefully-considered engagement letter with the client.&nbsp; If you think that &ldquo;national counsel&rdquo; is going to monitor a case or a docket after some certain end point, you should additionally&nbsp;clarify that understanding, something the court here said would have helped.
And, hey &mdash; <a href="https://www.americanbar.org/groups/professional_responsibility/publications/model_rules_of_professional_conduct/rule_1_1_competence/">Model Rule 1.1</a> (&ldquo;Competence&rdquo;) and <a href="https://www.americanbar.org/groups/professional_responsibility/publications/model_rules_of_professional_conduct/rule_1_3_diligence/">Model Rule 1.3</a> (&ldquo;Diligence&rdquo;) mean that we can&rsquo;t&nbsp;just totally put down our practices when we go on vacation.&nbsp;&nbsp;That was true even in the days before e-mail and PACER, when someone &ldquo;back at the ranch&rdquo; would be monitoring our postal mail.&nbsp; Now, the available&nbsp;technology means there is little excuse for not being aware of court filings in real time.
As for&nbsp;clearing up the inevitable post-vacation backlog of e-mails,&nbsp;the laundry from the trip might have to wait &mdash; but that&rsquo;s okay, isn&rsquo;t it?

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Ethics

Legal Ethics, Professional Responsibility and the Business of Law

Client sanctioned for local counsel’s communication screw-up