Pattern-Based Disbarment for Repeated Client Neglect, Dishonesty, and Unrefunded Flat Fees; Unconditional Refund Duty Reaffirmed — In re McCloud (Minn. 2025)

Pattern-Based Disbarment for Repeated Client Neglect, Dishonesty, and Unrefunded Flat Fees; Unconditional Refund Duty Reaffirmed — In re McCloud (Minn. 2025)

The Minnesota Supreme Court disbarred long-time criminal defense attorney Samuel A. McCloud for repeated neglect of a DWI client, failure to timely communicate and explain plea offers, making a knowingly false statement to the court, and retaining an unearned portion of a flat fee, all aggravated by an extensive, similar disciplinary history and a lack of remorse. The court also clarified that the duty to refund the unearned portion of a flat fee is unconditional and not contingent on fee arbitration.

Introduction

In a per curiam opinion dated October 15, 2025, the Minnesota Supreme Court, exercising original jurisdiction in attorney discipline, considered the appropriate sanction for Samuel A. McCloud (Reg. No. 0069693). McCloud, admitted in 1977 and a practitioner focused largely on DWI defense, already stood suspended due to two prior public disciplinary actions. This case arises from his representation of “D.D.,” a 73-year-old client charged after a car crash on March 6, 2020. D.D. retained McCloud on March 17, 2020, paying a $6,000 flat fee—about four months of D.D.’s Social Security income, partly borrowed from his daughter, S.W.

The Director of the Office of Lawyers Professional Responsibility (OLPR) alleged that McCloud: (1) neglected and delayed the matter; (2) failed to communicate and explain plea offers; (3) made a knowingly false statement to the district court; and (4) failed to refund the unearned portion of a flat fee when the representation ended. A referee found violations of Minn. R. Prof. Conduct 1.3, 1.4, 1.5(b)(3), 1.16(d), 3.3(a)(1), 4.1, and 8.4(c), along with multiple aggravating factors and no mitigation.

Because neither party ordered a transcript, the referee’s findings and rule-violation conclusions were conclusive under Rule 14(e), Rules on Lawyers Professional Responsibility (RLPR). The sole issue before the court was the sanction. The Director requested an indefinite suspension with no right to petition for reinstatement for 90 days; the referee recommended the same (and considered recommending 120 days). The court imposed disbarment.

Summary of the Opinion

  • The court accepted, as conclusive under RLPR 14(e), that McCloud:
    • neglected D.D.’s criminal case and failed to communicate or explain plea offers (Rules 1.3 and 1.4),
    • failed to refund the unearned portion of a flat fee upon termination (Rules 1.5(b)(3) and 1.16(d)),
    • knowingly made a false statement to the court, and made false statements to others (Rules 3.3(a)(1), 4.1, and 8.4(c)).
  • Aggravating factors: substantial experience, a strikingly extensive and similar disciplinary history, and lack of remorse. No mitigating factors were proved.
  • Applying the four-factor framework (nature of misconduct; cumulative weight; harm to the public; harm to the profession), the court found the misconduct very serious, cumulative, harmful to an elderly client of limited means, and damaging to public confidence in the bar.
  • Although the Director and referee recommended an indefinite suspension with 90 days before a right to petition, the court concluded that was too lenient given the decades-long pattern of similar misconduct and imposed disbarment.
  • Clarification: The duty to refund unearned portions of a flat fee is unconditional and not dependent on fee arbitration; fee-resolution processes may be encouraged but do not suspend the refund duty.
  • Procedural guidance: Without a transcript, attorneys cannot relitigate factual findings on appeal (RLPR 14(e)), although pure legal interpretation remains reviewed de novo.

Key Holdings and Clarifications

  • Disbarment is appropriate when repeated client neglect, failure to convey and explain plea offers, dishonesty to a court, and retention of unearned flat fees are coupled with extensive, similar prior discipline and lack of remorse.
  • Rules 1.5(b)(3) and 1.16(d) impose an affirmative, unconditional duty to promptly refund unearned fees upon termination; that duty is independent of whether fee arbitration occurs.
  • Referees and the Director should avoid “double counting” intent as an aggravator when the charged violations (e.g., Rules 3.3(a)(1) and 4.1) require knowledge or intent; unpled rule violations (e.g., Rule 8.4(d)) should not be used as aggravators.
  • Prior discipline remains an aggravating factor even if the current misconduct predated the later-imposed discipline; it evidences a dangerous pattern and heightens public-protection concerns.
  • RLPR 14(e) makes the referee’s factual findings and rule-violation conclusions conclusive in the absence of a transcript; only discipline is then at issue.
  • In criminal cases, the duty to communicate plea offers promptly and clearly is a serious ethical obligation; failure to do so is a clear rule violation.

Detailed Analysis

Factual Background and Procedural Posture

D.D.’s misdemeanor DWI case was filed April 17, 2020, with charges amended five days later to two misdemeanor counts. McCloud appeared at arraignment but did not file a certificate of representation at first. As a result, on August 6, 2020, the prosecutor wrote directly to D.D. offering a plea to one misdemeanor count with no jail, valid until the pretrial hearing. D.D. and his daughter, S.W., contacted McCloud. After S.W. emailed the documents, McCloud did not respond or explain the offer or the accompanying discovery and driver’s license revocation notice. He filed a certificate on August 21, 2020, erroneously stating he represented D.D. on “Gross Misdemeanor Refusal,” when only misdemeanors were then charged.

On February 24, 2021, the day of a pretrial, the court suspended McCloud for at least 60 days effective March 10, 2021, in a prior matter (McCloud II), with conditions including passing the MPRE within one year. He notified the county attorney’s office of the suspension, but not D.D. He was conditionally reinstated on May 10, 2021. On May 14, 2021, the prosecutor renewed the misdemeanor-only plea offer, good until May 21. McCloud neither conveyed the offer nor responded. The State dismissed the misdemeanor charges July 28, 2021, indicating it would refile with a gross misdemeanor; McCloud did not inform D.D.

On July 30, 2021, the State charged D.D. with gross misdemeanor test refusal and a misdemeanor DWI. After McCloud filed a letter on November 16, 2021, falsely asserting a “lengthy” settlement discussion with the second prosecutor, the prosecutor sent a new offer on November 19, 2021, to plead to the misdemeanor with dismissal of the gross misdemeanor, open until January 2, 2022. McCloud replied that he would confer with his client but never did, and he never communicated the offer. In late January, when the prosecutor called, McCloud did not recognize his client’s name and said, “He’s innocent” and wanted a trial. Concerned about the representation, the prosecutor contacted S.W. on February 4, 2022, explained the offer, and emphasized that D.D. had an opportunity to resolve the case. D.D. terminated McCloud and requested a refund of unearned fees; none has been provided.

On March 9, 2022, with new counsel, D.D. pled guilty to a misdemeanor DWI and the gross misdemeanor was dismissed—the same resolution available early in the case. D.D.’s license had been suspended nearly two years, with significant stress and disruption.

Meanwhile, McCloud failed to pass the MPRE and had his conditional reinstatement revoked in March 2022 (with leave to reapply upon proof of passing). He was later indefinitely suspended in another matter (McCloud V, Dec. 2023) and remains suspended.

In this case, after a September 2024 evidentiary hearing, the referee found clear and convincing evidence of violations of Rules 1.3; 1.4(a)(2)–(3) and (b); 1.5(b)(3); 1.16(d); 3.3(a)(1); 4.1; and 8.4(c), plus multiple aggravators and no mitigation. The Director sought an indefinite suspension with a 90-day minimum; the referee recommended that sanction. Because no transcript was ordered, the Supreme Court accepted the referee’s findings and rule-violation conclusions as conclusive and decided only the sanction.

Precedents Cited and Their Influence

  • RLPR 14(e); In re Montez, 812 N.W.2d 58 (Minn. 2012); In re Mollin, 940 N.W.2d 470 (Minn. 2020): Without a transcript, factual findings and rule-violation conclusions are conclusive; pure legal interpretation is reviewed de novo. This confined the case to sanction only.
  • In re Eichhorn-Hicks, 916 N.W.2d 32 (Minn. 2018): Failure to communicate a settlement or plea offer is serious misconduct and a clear rule violation. This case framed McCloud’s failures as grave, not technical.
  • In re Brooks, 696 N.W.2d 84 (Minn. 2005); In re Lennington, 969 N.W.2d 76 (Minn. 2022): A continuing pattern of client neglect is serious misconduct that alone can warrant indefinite suspension; used to weigh the “nature of misconduct” factor.
  • In re Taplin, 837 N.W.2d 306 (Minn. 2013): Failure to refund unearned fees is serious misconduct because it deprives clients of their funds. This supports viewing the flat-fee refund failure as significant harm.
  • In re Ruffenach, 486 N.W.2d 387 (Minn. 1992); In re Schmidt, 402 N.W.2d 544 (Minn. 1987); In re Nwaneri (Nwaneri I), 896 N.W.2d 518 (Minn. 2017): Dishonesty to a court is misconduct of the highest order and warrants severe discipline.
  • In re Oberhauser, 679 N.W.2d 153 (Minn. 2004); In re Hansen, 868 N.W.2d 55 (Minn. 2015); In re Murrin, 821 N.W.2d 195 (Minn. 2012): Articulate the four-factor sanction framework and emphasize cumulative misconduct warrants more severe sanctions.
  • In re Hulstrand, 910 N.W.2d 436 (Minn. 2018): Harm to the public includes financial loss, delay, anxiety, and distress caused by neglect—all present here.
  • In re Nathanson, 812 N.W.2d 70 (Minn. 2012); In re Shaughnessy, 467 N.W.2d 620 (Minn. 1991); In re Ulanowski (Ulanowski II), 834 N.W.2d 697 (Minn. 2013); In re Sea, 932 N.W.2d 28 (Minn. 2019): Neglect, failure to communicate, misuse of client funds, and false statements damage the profession’s reputation and erode public confidence.
  • In re Bosse, 951 N.W.2d 469 (Minn. 2020); In re Langree, 9 N.W.3d 159 (Minn. 2024): Substantial experience is an aggravator; experienced lawyers are expected to avoid such lapses, especially in their primary practice area.
  • In re Sea, 932 N.W.2d 28 (Minn. 2019); In re Nwaneri (Nwaneri II), 978 N.W.2d 878 (Minn. 2022); In re Cutting, 671 N.W.2d 173 (Minn. 2003): Prior discipline—even if imposed after the present misconduct—aggravates because it evidences a dangerous pattern; similar prior misconduct compounds severity.
  • McCloud’s own prior cases:
    • In re McCloud (McCloud I), 826 N.W.2d 529 (Minn. 2013) (order): Suspension for intentional tax dishonesty.
    • In re McCloud (McCloud II), 955 N.W.2d 270 (Minn. 2021): 60-day suspension and MPRE condition; later revocation of conditional reinstatement for MPRE noncompliance.
    • In re McCloud (McCloud V), 998 N.W.2d 760 (Minn. 2023): Indefinite suspension with a 90-day minimum and Rule 18 reinstatement process due to an “strikingly extensive” history; set the stage for heightened public-protection scrutiny.
  • Comparators on sanction selection:
    • In re Bruggeman, 992 N.W.2d 371 (Minn. 2023) (order): Indefinite suspension with 90-day minimum amid multiple violations including forgery and fabrications; mitigating “extreme personal stress” and a lesser disciplinary history distinguished it.
    • In re Nemer, 991 N.W.2d 274 (Minn. 2023) (order): 90-day suspension for incompetence, neglect, failure to communicate, disobeying a court, and false statements; lesser prior discipline distinguished it.
    • In re Winter, 770 N.W.2d 463 (Minn. 2009); Sea (2019): False statements alone can warrant 120-day minimum suspensions; used to benchmark the dishonesty component here.
    • In re Brehmer, 642 N.W.2d 431 (Minn. 2002); In re Redburn, 746 N.W.2d 330 (Minn. 2008): Pattern-based disbarments where current misconduct mirrored extensive, similar prior misconduct; strong analogs supporting disbarment here.

The Court’s Legal Reasoning

The court used its established four-factor calculus:

  • Nature of the misconduct. Three categories: (1) a pervasive failure to diligently handle and communicate about D.D.’s case—especially not conveying plea offers and critical developments; (2) retention of an unearned flat fee after termination; and (3) a knowingly false statement to the court about a “lengthy” settlement conversation that never occurred. Each is serious; in combination, they are very serious.
  • Cumulative weight. The violations occurred repeatedly over an extended period and in different ethical domains (diligence/communication, fees, candor). The court emphasized that cumulative violations warrant more severe sanctions than a brief or isolated lapse.
  • Harm to the public. D.D. was elderly, on a fixed income, and financially harmed when a $6,000 fee was not refunded. He endured nearly two years without a driver’s license, unnecessary re-booking, and significant anxiety and distress—only to obtain the same misdemeanor-only resolution that had been available early on, had it been communicated and pursued.
  • Harm to the profession. Neglect, noncommunication, misuse/retention of client funds, and dishonesty erode public trust in the legal profession.

Aggravators included:

  • Substantial experience: nearly 50 years in practice, with DWI defense comprising the bulk of his work—yet basic communication and diligence failures occurred.
  • Extensive, similar disciplinary history: Twelve prior dispositions (seven admonitions; one private probation; one public reprimand; three suspensions), including failures to communicate, neglect, and dishonesty—closely mirroring the current misconduct and amplifying sanction severity.
  • Lack of remorse: McCloud blamed the client and daughter for not asking the “right” questions and insisted he could keep the flat fee absent fee arbitration, showing no recognition of wrongdoing or harm.

The court declined to treat “intentionality” as an aggravator because the same conduct already grounded violations of Rules 3.3(a)(1) and 4.1, which require knowledge/intent. It also noted that the referee’s reference to Rule 8.4(d) in the aggravation analysis was inapt because the Director had not charged that rule and, in any event, the intent element was already baked into the proven violations.

Looking to comparable cases to calibrate the sanction, the court found that lesser suspensions in other matters involved less extensive disciplinary histories or mitigation. It relied on Brehmer and Redburn to conclude that when present serious misconduct mirrors a long pattern of similar violations, disbarment is warranted to protect the public. The court emphasized it would not reduce a sanction merely because the present misconduct predated a later suspension; instead, later-imposed discipline still aggravates by revealing a pattern and heightening public-protection concerns (citing Nwaneri II).

Finally, the court reaffirmed that under Rules 1.5(b)(3) and 1.16(d), the obligation to refund unearned fees is unconditional; lawyers cannot condition refunds on fee arbitration. Although bar fee-resolution procedures may be “encouraged,” they do not suspend the duty to return unearned portions promptly.

Why the Court Departed Upward from the Referee’s Recommendation

  • The “strikingly extensive” history of similar misconduct (as previously emphasized in McCloud V) demonstrated that lesser sanctions had not protected the public.
  • The present violations replicated core duties previously breached (diligence, communication, honesty, and fee handling), underscoring a persistent pattern rather than an aberration.
  • The absence of mitigation and the presence of overt non-remorse eliminated reasons to moderate the sanction.
  • Even though the Director and referee proposed an indefinite suspension with a 90-day minimum, precedent (Brehmer, Redburn) and public protection considerations justified disbarment.
  • The court explicitly rejected the notion that sanctions should be lighter because the misconduct predated the most recent suspension; prior discipline still aggravates by evidencing a dangerous pattern requiring decisive action (Nwaneri II).

Impact and Prospective Significance

  • Single-matter misconduct can lead to disbarment when combined with a lengthy, similar disciplinary history and lack of remorse. This decision signals the court’s willingness to depart upward from a referee’s recommendation to protect the public.
  • Criminal defense practice: The duty to promptly convey and explain plea offers is nonnegotiable. Failing to communicate a plea—especially one that avoids jail or a higher-level charge—is serious misconduct.
  • Flat-fee practices: Lawyers must specify the scope of work covered and maintain an internal accounting of what has been earned. Upon termination, the unearned portion must be refunded promptly; lawyers cannot refuse refunds pending fee arbitration.
  • Candor to the court: Even seemingly “small” false statements (e.g., asserting a conversation occurred when it did not) are treated as serious integrity breaches warranting severe discipline.
  • Procedural practice: Under RLPR 14(e), respondents who wish to challenge factual findings must order a transcript. Failure to do so confines appellate arguments to the sanction.
  • Sanction calibration: Referees and the Director should recognize the court’s admonition against double-counting intent and relying on unpled rule violations at the aggravation stage.
  • Client populations with special communication needs: When a client is elderly or has limited digital access, lawyers must adapt communications and proactively explain developments. The duty to communicate is affirmative; it is not the client’s duty to ask.

Complex Concepts Simplified

  • Unconditional flat-fee refund duty:
    • Rule 1.5(b)(3) requires refunding the unearned portion of a flat fee if representation ends before the fee is fully earned. Rule 1.16(d) similarly requires steps to protect the client upon termination, including refunding unearned fees.
    • Even if there is a fee dispute, the lawyer must take reasonable and prompt steps to resolve it and cannot use the dispute to withhold money that is plainly unearned.
  • Duty to communicate plea offers:
    • In criminal cases, lawyers must timely convey and explain plea offers so clients can make informed decisions. Failure to do so is a serious ethics violation.
  • Candor to the tribunal:
    • Rules 3.3(a)(1) and 4.1 prohibit knowingly making false statements of fact to a court or others. Integrity is foundational; violations trigger severe sanctions.
  • Aggravating vs. mitigating factors:
    • Aggravators increase severity (e.g., extensive prior discipline, lack of remorse, substantial experience). Mitigators can reduce severity (e.g., documented personal crises, restitution, rehabilitation), but the lawyer bears the burden of proving mitigation.
  • RLPR 14(e) and transcripts:
    • If no transcript is ordered from the referee hearing, the Supreme Court treats the referee’s findings and rule-violation conclusions as binding. Only the level of discipline can be argued.
  • Indefinite suspension vs. disbarment:
    • Indefinite suspension removes a lawyer from practice until conditions are met; disbarment terminates the license entirely. Both require compliance with post-discipline duties (e.g., Rule 26 notices). Reinstatement after disbarment is extraordinary and not guaranteed.

Practical Compliance Checklist for Practitioners

  • At first appearance in criminal cases, file the certificate of representation promptly and correctly.
  • Record and calendar all plea offers with clear deadlines; relay and explain them to the client promptly and document the communication.
  • Adapt communication methods to client needs (e.g., limited email access); confirm client understanding of key developments.
  • Never misstate facts to the court or opposing counsel; if a mistake occurs, correct it immediately.
  • For flat fees, specify scope in the engagement letter. Track work performed. Upon termination, promptly refund any unearned portion—regardless of fee arbitration status.
  • On suspension, immediately notify clients, opposing counsel, and courts as required by Rule 26, RLPR; avoid any unauthorized practice.
  • If subject to discipline, demonstrate remorse and concrete remedial steps; provide mitigation evidence where appropriate.
  • If challenging referee findings on appeal, order the transcript to preserve the ability to contest factual findings and rule-violation conclusions.

Conclusion

In re McCloud reinforces a clear message: persistent neglect, failure to communicate critical plea offers, dishonesty toward the tribunal, and refusal to return unearned flat fees—especially against a backdrop of extensive, similar prior discipline and non-remorse—will yield the profession’s ultimate sanction. The decision also clarifies that refunding unearned flat fees is an unconditional ethical duty, not contingent on fee arbitration. By departing upward from a referee’s suspension recommendation to impose disbarment, the court signaled that public protection, the integrity of the courts, and deterrence will govern sanction selection where a pattern of misconduct persists despite prior leniency.

Effective immediately, McCloud is disbarred, must comply with Rule 26 RLPR (notices), and pay costs under Rule 24(a). For Minnesota practitioners, the opinion is a comprehensive reminder that diligent, transparent, and honest client service—especially in criminal matters where liberty and livelihoods are at stake—is not merely aspirational; it is ethically mandatory.

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