Los Angeles, CA – September 2024

Stephen Charles Daly, a veteran attorney admitted to the California State Bar in 1987, is now facing serious disciplinary action, including potential disbarment, after his recent felony conviction and subsequent failure to comply with court orders. The State Bar of California has filed a formal Notice of Disciplinary Charges against Daly, citing multiple violations that could end his 37-year legal career.

Felony Conviction Leads to Suspension

In September 2022, Daly was convicted of violating Health and Safety Code section 11377(a) for possession of a controlled substance, a felony offense. This conviction prompted the State Bar’s Review Department to issue an interim suspension order, effective October 24, 2022. As part of this suspension, Daly was required to follow the procedures outlined in California Rules of Court, Rule 9.20. This rule mandates that suspended attorneys notify their clients, opposing counsel, and the courts of their inability to practice law, and file proof of compliance with the State Bar.

Failure to Comply with Court Orders

The charges against Daly allege that he failed to follow these rules. Despite receiving clear instructions, Daly did not notify his clients or opposing counsel of his suspension. Specifically, in the case of Pickford Fund, LLC v. Kahrobai, Daly continued to represent his client without informing them of his suspension, as required by the court order.

Additionally, Daly is accused of failing to file the required affidavit with the State Bar, which would confirm his compliance with the suspension order. These actions, if proven true, constitute a violation of Business and Professions Code section 6103, which governs the misconduct of attorneys in connection with their profession.

Disciplinary Consequences

Daly now faces the possibility of severe penalties, including disbarment. According to the State Bar Court’s rules, failure to respond to these charges within 20 days could result in a default judgment, leading to his immediate disbarment and inactive status. Moreover, Daly may face monetary sanctions of up to $50,000, should the court find him guilty of violating the court’s orders.

The disciplinary proceedings could have lasting implications not only for Daly but also for the legal community, as they highlight the importance of strict compliance with court orders and the ethical standards expected of California attorneys.

What Happens Next?

As of now, Daly has a limited window to respond to the Notice of Disciplinary Charges. If he fails to do so, the State Bar Court may proceed with recommending his disbarment, further cementing the gravity of these proceedings.

For the legal community, this serves as a reminder that attorneys are held to high ethical and professional standards. Compliance with court orders and transparency with clients and the courts are not only expected but mandated under California law. Any deviation from these responsibilities can lead to serious consequences, as Daly’s case demonstrates.