In re Disciplinary Action against McCray, No. 20070376.

CourtUnited States State Supreme Court of North Dakota
Writing for the CourtPer Curiam
Citation2008 ND 162,755 N.W.2d 835
Decision Date03 September 2008
Docket NumberNo. 20070376.,No. 20070377.
PartiesIn the Matter of the Application for DISCIPLINARY ACTION AGAINST Loren C. McCRAY, A Member of the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner, v. Loren C. McCray, Respondent.
755 N.W.2d 835
2008 ND 162
In the Matter of the Application for DISCIPLINARY ACTION AGAINST Loren C. McCRAY, A Member of the Bar of the State of North Dakota.
Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner,
v.
Loren C. McCray, Respondent.
No. 20070376.
No. 20070377.
Supreme Court of North Dakota.
September 3, 2008.

[755 N.W.2d 837]

Paul W. Jacobson, Disciplinary Counsel, Bismarck, N.D., for petitioner.

Michael R. Hoffman, Bismarck, N.D., for respondent.

SUSPENSION ORDERED.

PER CURIAM.


[¶ 1] Loren C. McCray and counsel for the Disciplinary Board petition this Court

755 N.W.2d 838

for review of a hearing panel's report and recommendation that McCray be suspended from the practice of law for 120 days for violating the North Dakota Rules of Professional Conduct and the North Dakota Rules for Lawyer Discipline for activities related to "credit repair." We conclude there is clear and convincing evidence McCray violated N.D.R. Prof. Conduct 1.5, 4.1, 5.4, 5.5(e), 7.3(a), 8.4(c), (f), and (g), and N.D.R. Lawyer Discipl. 1.2A(3) and (8). We suspend McCray from the practice of law for six months and one day and order that he pay the costs of the disciplinary proceedings.

I

[¶ 2] McCray was admitted to practice law in North Dakota on November 7, 1994. Since then he has practiced law in Jamestown, Hebron, and Beulah, and he currently practices primarily bankruptcy law in Bismarck. In August 2004, McCray became employed by Bradley Ross Law, a California corporation owned by John T. McManus, an attorney licensed to practice law in California and Indiana. Bradley Ross Law performed credit repair services for its clients. McCray learned that Bradley Ross Law was looking for a North Dakota lawyer because Bradley Ross Law had determined North Dakota was one of the few states that allows trade names to be used for a law firm name and North Dakota has no credit repair organizations act. McCray opened a Bismarck office for Bradley Ross Law acting as a professional corporation in North Dakota through a certificate of foreign corporation. McCray also operated his own law firm, Loren McCray, Attorney at Law, from the same address with the assistance of one employee.

[¶ 3] In January 2005, McCray became the sole shareholder and employee of Bradley Ross Law, P.C., a North Dakota professional corporation, and in October 2005, he purchased the clients and business of Bradley Ross Law from McManus. The hearing panel described the business operations of Bradley Ross Law, P.C.:

In his work for Bradley Ross Law, P.C., McCray reviews client files, speaks with clients, disputes items on clients' credit reports with credit reporting agencies, and performs related work. From August 2004 to the present, Bradley Ross Law and Bradley Ross Law, P.C. have had no other employees, except McCray, in North Dakota. During the timeframe that McCray has been associated with Bradley Ross Law and Bradley Ross Law, P.C., there have been approximately 25 to 30 employees working for the corporations as leased employees in Fishers, Indiana. The employees, along with computer services, marketing services, a processing center, and other services are leased from a service provider by the name of Bellwether, Inc., or its affiliates. Several of the leased employees in Indiana are listed as legal assistants of Bradley Ross Law, P.C. (formerly Bradley Ross Law) and perform such duties as disputing items on client credit reports, making requests directly to creditors with respect to disputed items, responding to client inquiries, and performing related duties.

[¶ 4] McCray was paid $26,000 per year when he first became employed with Bradley Ross Law in 2004. Bradley Ross Law had 18,000 clients that year, and in 2003 the firm had $8,500,000 in gross income. After McCray formed Bradley Ross Law, P.C., he began drawing $50,000 per year from the business. In 2006 McCray earned about $75,000 from the business, which had gross revenue of $10,000,000 but had a tax loss of $10,000. That year Bradley Ross Law, P.C., had approximately 9,450 clients and McCray

755 N.W.2d 839

spent about one-half of his time working for the business. Of the $10,000,000 in 2006 gross revenue received by the firm, about $9,500,000 was paid to Bellwether, Inc., or its affiliates. Bellwether, Inc., is owned by Steve Snyder, who gave seminars on how to improve credit scores. During 2005, Bradley Ross Law, P.C., and other entities sponsored approximately 25 seminars conducted by Bellwether, Inc., across the country. McCray did not personally attend any of the seminars.

[¶ 5] In January 2005, Dr. Michaela McKenzie, a dentist in Georgia, received a letter from Snyder inviting her to attend a seminar about regaining credit after bankruptcy. McKenzie, who had recently been through bankruptcy, decided to attend. The hearing panel described what occurred at the seminar:

Dr. McKenzie attended a seminar at a hotel in Atlanta, Georgia on February 26, 2005. Snyder presented this seminar to 400 to 500 people. Snyder explained that he was able to improve his credit score, after his own bankruptcy, by use of an attorney and explained how the attendees at the seminar could also improve their credit scores by use of an attorney who would write letters on their behalf. Snyder told the audience that they could, if they wanted to, use the law firm of Bradley Ross Law.

At the close of the seminar, Snyder invited people to sign up with Bradley Ross Law if they were interested in having their credit scores improved. Many of the attendees went through a hallway to another room where there was a bank of tables with approximately four people sitting behind them from Bradley Ross Law, P.C. Approximately 200 people from the seminar got in line to visit with the representatives of Bradley Ross Law, P.C. No other law firms were in attendance.

When Dr. McKenzie talked with a representative of Bradley Ross Law, P.C. on February 26, 2005, she was asked to sign a contract if she was interested in having Bradley Ross Law, P.C. assist her. She was advised that the standard charge was $79 per month, but if she signed up at the seminar, the cost would be $59 per month. Dr. McKenzie signed the contract. The contract stated that "[y]ou acknowledge that you intentionally sought out Bradley Ross Law in the State of North Dakota to perform legal services under federal law only in North Dakota." The contract also stated that the dispute letters that were created on behalf of a client by Bradley Ross Law were proprietary and were not kept in the client file. The client agreed to "waive any right to receive copies of letters created on my behalf." Dr. McKenzie skimmed the contract before signing it. In a letter dated May 13, 2005, Dr. McKenzie was advised that as a client on retainer, she was being charged $59 per month no matter how much work Bradley Ross Law, P.C. did for her.

[¶ 6] The contract McKenzie signed with Bradley Ross Law, P.C., also contained the following provision:

ITEMS TO BE APPEALED. If there are items on my credit reports I know to be accurate and verifiable, and do not want challenged, I will attach a separate list of these items at the inception of the agreement. Otherwise, I direct the law firm to dispute all negative credit listings, for I believe them to be inaccurate, outdated, or unverifiable.

McKenzie "skimmed" this provision before signing the contract, but "didn't really have any feeling about that paragraph." The representatives at the seminar and Bradley Ross Law, P.C., during the presentation did not ask McKenzie to submit a

755 N.W.2d 840

list of non-disputed items which appeared on her credit reports. McKenzie sent Bradley Ross Law, P.C., a list of debts that had been listed in her bankruptcy pleadings, but she did not dispute any of those obligations.

[¶ 7] McKenzie eventually became concerned about the letters Bradley Ross Law, P.C., was sending to credit reporting agencies on her behalf and requested copies of the letters from the firm. On January 13, 2006, Bradley Ross Law, P.C., sent McKenzie copies of three March 2005 dispute letters it had sent to credit reporting agencies. Each letter had McKenzie's name typewritten in the writer's signature block, but no written signature appears and Bradley Ross Law, P.C., is not identified in any of the letters. A March 29, 2005, letter to Trans Union stated, "Can you help me? I do not recognize these listings that show on my report: . . . Please remove them. Thank you." Another March 29, 2005, letter to Equifax stated:

Where do you get off trying to ruin people's lives?!? You have done more harm to me than if you had run over my dog and shot out my porch light. Get these off my report. I've never even seen these accounts before.

A letter to Experian also dated March 29, 2005, stated:

It is sad when a huge company such as yours makes such awful mistakes that they injure the common people, such as myself. Where did you get this information? These are the issues I'm talking about.

. . . .

These do not look like anything I'd dealt with. I am a peaceful person who leads a very calm life and I don't like this type of upheaval. So please get rid of them so I have one less worry on my mind.

[¶ 8] The information contained in the letters was not factual and McKenzie was "absolutely horrified" when she saw the letters. McKenzie thought she was paying for letters to credit reporting agencies written by attorneys on Bradley Ross Law, P.C., letterhead. She did not deny that the accounts mentioned in the letters were accurate. Furthermore, McKenzie, who has a doctorate degree, was upset that the letters purportedly sent by her contained misspellings and poor grammar. Although the record does not indicate that McCray made a knowing decision about which form letters to send on McKenzie's behalf, the hearing panel found "McCray knowingly authorized the use of form letters which contained false information in that...

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5 practice notes
  • Ad Astra Recovery Servs. v. Heath, Case No. 18-1145-JWB
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • February 26, 2021
    ...highly unlikely that all of the statements in the letters were true for all 595,117 letters. See In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 21, 755 N.W.2d 835, 843 (N.D. Sept. 3, 2008) ("He was obviously aware the form letters were not written or sent by [the client] and the i......
  • In re Haderlie, No. 20160133.
    • United States
    • United States State Supreme Court of North Dakota
    • September 20, 2016
    ...a refund of an attorney [885 N.W.2d 82fee and was prejudicial to administration of justice); In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 27, 755 N.W.2d 835 (soliciting vulnerable clients for pecuniary gain and charging unreasonable fees for mailing false and misleading dispute ......
  • In re Disciplinary Action against Stensland, No. 20080213.
    • United States
    • United States State Supreme Court of North Dakota
    • April 30, 2009
    ...proceedings. II [¶ 9] "Disciplinary proceedings are reviewed by this Court de novo on the record." Disciplinary Bd. v. McCray, 2008 ND 162, ¶ 12, 755 N.W.2d 835 (quoting Disciplinary Bd. v. Buresh, 2007 ND 8, ¶ 6, 726 N.W.2d 210). "Although we give due weight to the findings, conclusions, a......
  • Ad Astra Recovery Servs. v. Heath, Case No. 18-1145-JWB
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • March 3, 2021
    ...nor does he discuss the lack of any attorney involvement in the dispute letter process. See In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 21, 755 N.W.2d 835, 843 (N.D. Sept. 3, 2008) ("He was obviously aware the form letters were not written or sent by [the client] and the inform......
  • Request a trial to view additional results
5 cases
  • Ad Astra Recovery Servs. v. Heath, Case No. 18-1145-JWB
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • February 26, 2021
    ...highly unlikely that all of the statements in the letters were true for all 595,117 letters. See In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 21, 755 N.W.2d 835, 843 (N.D. Sept. 3, 2008) ("He was obviously aware the form letters were not written or sent by [the client] and the i......
  • In re Haderlie, No. 20160133.
    • United States
    • United States State Supreme Court of North Dakota
    • September 20, 2016
    ...a refund of an attorney [885 N.W.2d 82fee and was prejudicial to administration of justice); In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 27, 755 N.W.2d 835 (soliciting vulnerable clients for pecuniary gain and charging unreasonable fees for mailing false and misleading dispute ......
  • In re Disciplinary Action against Stensland, No. 20080213.
    • United States
    • United States State Supreme Court of North Dakota
    • April 30, 2009
    ...proceedings. II [¶ 9] "Disciplinary proceedings are reviewed by this Court de novo on the record." Disciplinary Bd. v. McCray, 2008 ND 162, ¶ 12, 755 N.W.2d 835 (quoting Disciplinary Bd. v. Buresh, 2007 ND 8, ¶ 6, 726 N.W.2d 210). "Although we give due weight to the findings, conclusions, a......
  • Ad Astra Recovery Servs. v. Heath, Case No. 18-1145-JWB
    • United States
    • United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas
    • March 3, 2021
    ...nor does he discuss the lack of any attorney involvement in the dispute letter process. See In re Disciplinary Action Against McCray, 2008 ND 162, ¶ 21, 755 N.W.2d 835, 843 (N.D. Sept. 3, 2008) ("He was obviously aware the form letters were not written or sent by [the client] and the inform......
  • Request a trial to view additional results

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