Ohio Paralegal Fined for Her Unauthorized Practice of Law

An Ohio paralegal who used letterhead from the attorney she worked for, without his permission, to handle a matter by herself was fined $5,000 by the state high court for her “flagrant” conduct and enjoined from the further unauthorized practice of law.

The paralegal, identified by Ohio’s Supreme Court as Melissa M. Smidt, got into trouble after trying unsuccessfully to represent a client for the limited purpose of negotiating a home loan modification and avoid a foreclosure.

Whether a nonlawyer engages in the unauthorized practice of law depends on the specific actions a person takes, such as giving legal advice, drafting legal documents, or asserting legal defenses as part of the negotiation process, the state’s highest court said on Thursday.

Smidt operated a business called A Perfect Solution in Bay Village, the court said. It specialized in loan modifications and bankruptcy petitions, purportedly under direct attorney supervision, the court said.

In 2015, she accepted a $1,000 fee from the client for negotiating the loan modification even though the client already had an unrelated lawyer representing her in the foreclosure case.

Smidt sent two letters to the client’s mortgage holder on the letterhead of the attorney who employed her as a paralegal, identifying herself as a paralegal and her client’s legal representative for the limited purpose of negotiating a loan modification.

But when the foreclosure went through, the client terminated Smidt’s representation and asked the paralegal to return her documents and refund her fee, but Smidt failed to do either.

Smidt told the disciplinary counsel that she’d been supervised by her employer, attorney J. Norman Stark, but Stark denied that and said he fired her as a paralegal assistant because of her unauthorized practice of law. However, she continued to use his letterhead without his consent, he said.

Stark also said he never represented Smidt’s client or accepted payment from her.

“There is no evidence that any other licensed attorney was supervising Smidt’s provision of legal services,” the court noted.

Although the board on the unauthorized practice of law found no evidence that Smidt gave legal advice directly to any of her “clients,” she gave litigation advice to her client’s actual counsel of record in an effort to delay the foreclosure proceeding and contacted the court on her client’s behalf, it said.

Smidt also failed to meaningfully participate in the disciplinary proceeding, the court said, and her former employer, Stark, submitted evidence that his ex-paralegal had engaged in similar instances of the unauthorized practice of law for other people.

The case is Disciplinary Counsel v. Smidt, 2020 BL 216183, Ohio, No. 2019-0827, 6/11/20.