ETHICS
Supreme Court of Alaska (2022)
Alex Bartlow
In Disciplinary Matter Involving Merdes, 518 P.3d 727 (Alaska 2022), the supreme court held that
a four–year suspension from the practice of law is an appropriate sanction for an attorney’s
misconduct when the attorney intentionally defrauded a former client. (Id. at 743). An Alaska
Native corporation hired the attorney on a contingency fee basis to represent it in a land title
dispute. (Id. at 729). The land title dispute was resolved in favor of the Alaska Native corporation,
and the corporation challenged the validity of the contingency fee agreement with the attorney.
(Id. at 729–30). Through arbitration, the corporation was ordered to pay an amount to the attorney,
and the superior court affirmed the award. (Id. at 730). The corporation paid the amount to the
attorney and appealed the superior court’s ruling. (Id.). In the meantime, the attorney created a
new law firm and transferred most of the old firm’s assets to the new firm. (Id.). The supreme court
reversed the superior court’s ruling and ordered the attorney to repay the original award amount to
the Alaska Native corporation. (Id.). The attorney told the corporation that the firm with which the
corporation entered into a contingency fee agreement did not have sufficient assets to repay the
corporation. (Id.). The Alaska Bar implemented a disciplinary hearing against the attorney and
recommended that the attorney be suspended from the practice of law for one year. (Id. at 732–
37). The attorney appealed the recommendation. (Id. at 737). The supreme court weighed the duties
violated, the lawyer’s mental state, the extent of the actual or potential injury, and the existence of
any aggravating or mitigating factors. (Id. at 739–43). The court determined that suspension from
the practice of law for four years was the appropriate discipline for the attorney’s failure to pay
the judgement awarded to his former client when the attorney transferred millions of dollars from
his old firm to defraud the former client. (Id. at 743). The supreme court held that a four–year
suspension from the practice of law is an appropriate sanction for an attorney’s misconduct when
the attorney intentionally defrauded a former client. (Id.).
