“Enrolled as inactive?” “Administratively Suspended?” What does that mean?

Over the weekend, we learned that the California State Bar “suspend[ed] 1,600 attorneys for violating rules set up after Tom Girardi allegedly stole millions.” At first blush, this sounds horrible—this many attorneys did what now? However, what that really means is that these lawyers neglected to comply with new trust account requirements (including registering their trust accounts with the State Bar, completing an annual self-assessment, and certifying that they understand and comply with trust account rules). As a result, they were “enrolled as inactive for noncompliance.”

What does this mean? In California, lawyers who fail to comply with certain requirements (including taking continuing legal education classes or paying bar dues) may be placed on inactive status and are ineligible to practice law. This has the effect of a suspension, but is non-disciplinary, and generally can be reversed upon a showing of compliance and paying additional fees.

To be clear, the California lawyers are not accused of violations involving client funds, just paperwork. Breathless headlines about suspensions and disgraced attorneys aside, lawyers do need to comply with reporting requirements. It’s a cost of doing business.

These requirements exist in some form in every state. Wisconsin may suspend lawyers for failing to pay dues, complete CLE, or certify trust account compliance. Reinstatement from those suspensions (sometimes called “administrative suspension”) is often quick, effectuated by paying funds owed or showing completion of other requirements. Lawyers who let their license “lapse” (they just stop paying) are typically suspended. Whether it’s called “enrolled as inactive” or “administratively suspended,” lawyers with this status cannot practice law unless and until they reinstate.

That said—and I don’t have statistics on this, but anecdotally, many lawyers decide not to reinstate their license from an administrative suspension at all. An administrative suspension of more than three years requires a petition process and that can be involved, and some attorneys decide not to proceed if they don’t intend to actively practice here. They may have decided to retire, practice only out-of-state (administrative suspensions in one state generally don’t cause reciprocal suspensions in other license states because they’re not disciplinary), or move on to do other things.