Barry Downey, a name partner at Smith & Downey, may be a convicted felon, but the D.C. Court of Appeals says he should be allowed to continue practicing law, at least for now.
In an unprecedented ruling yesterday, Judge Anna Blackburne-Rigsby, Judge Michael Farrell, and Senior Judge William Pryor laid out the guidelines to be considered when determining whether a lawyer who has been convicted of a felony can continue practicing law while the D.C. Office of Bar Counsel conducts a disciplinary investigation.
Downey is also a co-founder of e-gold Ltd., an online alternative payment company set up to be a competitor to PayPal. In July, he pleaded guilty to operating a money-transmitting business without a license after it was found that e-gold lacked the oversight to keep out investment scam operators. According to the indictment, e-gold had also become a favorite means of payment for sellers of child pornography.
On Nov. 20, Downey was sentenced to three-years probation and $2,600 in fines.
In most cases, lawyers who are convicted of a felony automatically have their licenses suspended until disciplinary proceedings are finalized, but a D.C. Bar rule allows the court to set aside interim suspensions if “good cause” can be shown.
There’s the rub.
Before yesterday’s ruling, "the court had never before written on the set-aside portion of the rule, maybe because few people try to fight interim suspensions,” says D.C. Bar Counsel Gene Shipp.
The ruling lays out four factors to be considered before an interim suspension may be set aside: whether there is a risk of harm to the public, whether the disciplinary proceeding may result in a “significant sanction,” whether the balance of injuries warrants a suspension, and whether the suspension is in the public interest.
Based on those factors and Downey’s good standing before the e-gold incident, the court decided he should be allowed to continue practicing law while the Bar Counsel continues its investigation.
“It’s the first time the court has written on the issue, so it’s always helpful to have some guidance on how the rule should be applied,” Shipp says.
Downey did not return calls for comment.