BILL PARKER, Chief Bankruptcy Judge.
ON THIS DATE the Court considered the Motion for Summary Judgment filed by the Plaintiff, the State Bar of Texas ("Plaintiff"), in the above-referenced adversary proceeding and the responses in opposition to the Motion filed by the Defendants, Dell Edward James II and Miki Lu James ("Defendants" or "Debtors"), respectively, in the above-entitled adversary proceeding. The complaint in this action alleges that a judgment debt based upon certain attorneys' fee awards allegedly owed to the Plaintiff by the Defendants should be excepted from the Defendants' Chapter 7 discharge pursuant to 11 U.S.C. § 523(a)(7). The following memorandum of decision disposes of all issues before the Court.
Pursuant to Fed. R. Bankr. P. 7056, summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law."
The record presented is reviewed in the light most favorable to the non-moving party.
The Defendants have admitted the following material facts asserted by the Plaintiff:
1. Plaintiff State Bar of Texas is a governmental unit in that it is an agency of the State of Texas administered by the Supreme Court of Texas.
2. The Defendants are individuals and debtors in their underlying bankruptcy case.
3. Defendant Dell Edward James II has been disbarred and is not licensed to practice law as an attorney in the State of Texas.
4. On or about November 2, 2004, the State Bar of Texas initiated disciplinary proceedings against Dell James II in cause no. 296-2974-04, styled Commission for Lawyer Discipline v. Dell Edward James II, in the 296th Judicial District Court of Collin County, Texas.
5. On September 28, 2005, the Hon. Jerry D. Ray, Presiding Judge by Appointment, issued a Judgment of Public Reprimand against Dell Edward James II.
6. On or about July 16, 2007, the State Bar of Texas initiated disciplinary proceedings against Dell James II in case no. D0120631179, styled Commission for Lawyer Discipline v. Dell Edward James II before an evidentiary panel of the District 6 Grievance Committee.
7. On September 15, 2009, the Evidentiary Panel entered a Judgment of Disbarment against Dell Edward James II.
8. Defendants Dell Edward James II and Miki Lu James filed for relief under Chapter 7 on April 22, 2016. Mark A. Weisbart is the duly appointed Chapter 7 Trustee.
9. The State Bar of Texas filed a proof of claim on June 14, 2006, listing $40,049.23, owed as a result of attorneys' fees and direct expenses to the State Bar of Texas pursuant to the two referenced judgments (including accrued interest).
10. Defendants Dell James II and Miki Lu James have listed the State Bar of Texas as a creditor relative to amounts owed in Cause No. 296-2974-04 and D0120631179.
The following additional material fact asserted by the Defendants
11. Dell Edward James II and Miki James were married on May 4, 2011.
In response to the Plaintiff's motion, the Defendants assert that the entry of summary judgment in favor of the Plaintiff is precluded against Mr. James and Ms. James, respectively, on different grounds.
Defendant Dell Edward James II contends that the two attorneys' fee awards entered against him as a result of the two disciplinary judgments cannot constitute a "fine, penalty, or forfeiture payable to or for the benefit of a governmental unit" that could be rendered nondischargeable under § 523(a)(7) of the Bankruptcy Code.
Despite the fact that the terminology utilized in the Texas Rules of Disciplinary Procedure does not precisely match the language of § 523(a)(7), an overwhelming consensus in bankruptcy jurisprudence establishes that sanctions such as attorneys' fees and other cost assessments that arise in attorney disciplinary proceedings are properly viewed as penalties under that statute. Disciplinary Bd. of the Supreme Court of Pa. v. Feingold (In re Feingold), 730 F.3d 1268, 1273 (11th Cir. 2013); Richmond v. N.H. Supreme Court Comm. on Prof'l Conduct, 542 F.3d 913, 919-920 (1st Cir. 2008) and the numerous cases cited therein. Premised upon the rationale for restitution expressed in a criminal context in Kelly v. Robinson, 479 U.S. 36, 51-53 (1986), which held that § 523(a)(7) created "a broad exception for all penal sanctions" and that a criminal restitution order, though payable to the criminal victim, was sufficiently penal to warrant nondischargeability under § 523(a)(7), these cases recognize that attorney disciplinary proceedings are ultimately designed to protect the public. As one court described it,
Attorney Grievance Comm'n v. Smith (In re Smith), 317 B.R. 302, 309 (Bankr. D. Md. 2004). The penal nature of an attorneys' fees assessment in an attorney disciplinary proceeding is particularly compelling when, as in the Texas statute, the fee or cost assessment is discretionary rather than mandatory, and the authorized disciplinary body, in consideration of all of the circumstances, exercises its discretion to assess such fees in order to further the goals of deterrence and public protection. Comm'n for Lawyer Discipline v. Tindall (In re Tindall), 2009 WL 1231878, at *2 (Bankr. S.D. Tex., Apr. 29, 2009) ["The Texas Disciplinary Rules authorize trial courts to issue discretionary rather than mandatory awards of attorneys' fees and costs based on penal goals of punishment, deterrence, and protection of the public."]; see also, Feingold, 730 F.3d at 1274-75 ["By making the imposition of costs discretionary, the [state entity that enacts rules governing attorney discipline] has permitted them to be used more like a sanction than like the civil litigation analogue of awarding costs to prevailing parties as a matter of course."]; and WorldPeace v. Commission for Lawyer Discipline, 183 S.W.3d 451, 459-60 (Tex. App.-Houston [14th Dist.] 2005, pet. denied) [appropriate disciplinary body has discretion to utilize restitution as an appropriate sanction under Texas law, even when professional misconduct does not involve misapplication of funds]. The initial Judgment of Public Reprimand issued by the 296th Judicial District Court expressly provided that
Further, the subsequent Judgment of Disbarment expressly requires Mr. James to have paid the attorneys' fees assessment as a condition precedent to any consideration of a request for reinstatement of his law license.
Because the Texas attorney disciplinary system "exists to protect the public," Comm'n for Lawyer Discipline v. Schaefer, 364 S.W.3d 831, 835 n.1 (Tex. 2012), and because the attorneys' fees assessments against Mr. James were discretionarily invoked in the entry of each judgment against him in furtherance of that public protection role undergirding the attorney disciplinary system, the debts owed by Mr. James for attorneys' fees assessments arising from the two disciplinary judgments each constitute a "fine, penalty, or forfeiture" within the meaning of § 523(a)(7). Because the attorneys' fee assessments against Mr. James were also payable to and for the benefit of a governmental unit that did not constitute compensation for actual pecuniary loss, the Court concludes that the debts owed by Dell Edward James II arising from the attorneys' fees assessments made against him in the two referenced attorney disciplinary judgments are nondischargeable under § 523(a)(7).
As for the § 523(a)(7) count against Miki Lu James, the summary judgment record fails in its entirety to establish any indebtedness that is even owed by Miki James to the Plaintiff, nor does it establish any ground for nondischargeability were such debt to exist. The summary judgment record establishes that the respective entry dates of the disciplinary judgments against Dell Edward James II predates his marriage to Miki Lu James. Additionally, the Plaintiff failed to tender any summary judgment evidence regarding Ms. James in any respect. A plaintiff in this context must make a proper showing as against each individual debtor. There has been no showing of the existence of a debt owed by Ms. James. Further, even if she owed a liability, a debt which is nondischargeable against one spouse cannot be properly imputed to the other spouse based solely upon the existence of a marital relationship. Tower Credit, Inc. v. Gauthier (In re Gauthier), 349 Fed. App'x. 943, 945 (5th Cir. 2009). Thus, in the light of the failure of the summary judgment evidence to establish Ms. James' culpability in any respect, the Plaintiff's Motion for Summary Judgment as against Debtor-Defendant, Miki Lu James, must be denied.
Accordingly, upon due consideration of the pleadings, the proper summary judgment evidence submitted by the parties, the material facts admitted to exist under Fed. R. Bankr. P. 56, the relevant legal authorities and for the reasons set forth herein, the Court concludes that, as to the Plaintiff's cause of action against Defendant Dell Edward James II, there is no genuine issue as to any material fact and that the Plaintiff is entitled to judgment against Defendant Dell Edward James, II as a matter of law. Thus, the Court concludes that the Plaintiff, the State Bar of Texas, is entitled to summary judgment that the debts owed to it by the Debtor-Defendant, Dell Edward James, II arising from the attorneys' fees awarded in the two referenced attorney disciplinary judgments should be declared nondischargeable under 11 U.S.C. §523(a)(7). The Court further concludes that the Plaintiff's motion for summary judgment against Debtor-Defendant, Miki Lu James, should be denied in all respects. An appropriate order will be entered which is consistent with this opinion.
Crampton v. Comm'n for Lawyer Discipline, 2016 WL 7230396, at *3 (Tex. App.-El Paso, Dec. 14, 2016, no pet.) (citations omitted).
In re Caballero, 272 S.W.3d 595, 597 (Tex. 2008).
The term Sanction" may include the following additional ancillary requirements.
TEX. RULES DISCIPLINARY P. R. 1.06(Z), reprinted in 3B TEX. GOVT. CODE ANN., tit. 2, subtitl G, app. A-1 (West Supp. 2016).