Responding to State Professional Licensing Board Complaints

In South Carolina, the Department of Labor, Licensing & Regulation (“LLR”) is responsible for 42 different professions, including accountants, chiropractors, dentists, real estate appraisers, real estate brokers and agents, and veterinarians.  A complete list of the professionals licensed and regulated by the LLR in South Carolina can be found here:  www.llr.sc.gov/professions.aspx.  Each profession has its own provisions in the South Carolina Code of Laws and the South Carolina Code of Regulations; however, the complaint process and procedures are the same across the different professions and their governing Boards. A complaint, regardless of merit, will be investigated by the LLR.  On the front page of the LLR’s website is a link to file a complaint.  A client, opposing party, fellow professional, or any member of the public can file a complaint against a professional in South Carolina.  It is easy to do and does not cost the complainant any money, but it has potentially devastating impacts on the professional and his or her ability to practice in the State of South Carolina.

The Complaint Investigation Process

Once a complaint is filed, the investigator assigned by the LLR will contact the licensed professional to notify them of the complaint.  The investigator typically also attempts to discuss the complaint with the professional at that time or sets up a time in to discuss the complaint with the professional. In my experience, the LLR investigators are professional and pleasant, but it is important for respondents to understand that the investigator’s job is to determine whether there is merit to the complaint such that it should go before the Investigative Review Committee (“IRC”) for each particular licensing Board.  I am frequently contacted by clients who have already spoken to the LLR investigator, and I recommend that any professional notified of a LLR complaint contact your lawyer prior to speaking with the LLR investigator.  In addition to the interview process, professionals are given the opportunity to submit a written response to the complaint in addition to any supporting documents from their file.  Again, it is wise to engage a lawyer to assist with this process.  In addition, many professionals do not realize their professional malpractice insurance policies may have coverage for a Board licensing or disciplinary complaint.  Upon receipt of notice of the complaint, I recommend you immediately contact your insurance broker and/or professional liability insurer to determine if you have coverage.  Often, the coverage is separate from the malpractice coverage and provides a specific dollar amount for defense costs associated with the complaint.  The policies rarely cover any penalties associated with the complaint, but the defense cost coverage can be a significant help in opposing the complaint.  Professionals may have the ability to select their own counsel, or the insurance carrier will select counsel for them, however, most insurance companies will entertain a counsel request if you have a specific lawyer you would like to represent you.

Once the investigation is complete, the LLR investigator presents his or her findings to the IRC, which is a committee comprised of former Board members, other professionals in the field, and possibly non-professionals who advise the licensing board as to the complaint.  The IRC is advisory only and does not have the authority to act on behalf of the Board; however, in practice, the licensing boards often follow the recommendations of the IRC as to proceeding with complaints.  The IRC presents its findings and recommendation to the Board, and the Board will make a final decision whether to proceed with the complaint, dismiss the complaint, or issue a letter of caution.  If the Board decides to proceed with prosecuting the complaint, counsel for the LLR will take over and typically prepare a Consent Agreement.

Resolution Options Once the Board Decides to Pursue Complaint

The Consent Agreement involves the professional admitting to certain violations and a designated resolution.  I have also had clients who contact me after receiving a Consent Agreement, and even after having already agreed to a Consent Agreement.  It is important to understand that a Consent Agreement becomes public record, as it is posted on the LLR website.  If there was a violation and the professional is comfortable with the outcome, it may be that agreeing to the Consent Agreement is the best course of action.  However, it is important for professionals to understand there are other options. A second option is entering a Memorandum of Agreement (“MOA”) with the LLR.  The MOA involves admitting to certain facts related to the complaint, but enables the professional to present its position before the Board for a determination on the outcome.  This helps expedite the process and can result in potentially lesser penalties than those initially proposed in a Consent Agreement.  A final option for professionals is to proceed with a formal complaint.  Similar to a lawsuit, the LLR counsel will prepare and serve the formal complaint, and the professional must respond and defend its position.  If a resolution cannot be reached while the formal complaint is pending, the Board will schedule a contested hearing to consider the complaint.  Although a formal hearing lacks some of the formalities of court, it has similarities to trial in that the parties may present witnesses, lawyers can cross-examine the witnesses, and the Board serves as the “judge”.  The Board members will often ask questions of the professional, the lawyers, and the witnesses, and the parties may present evidence, including expert testimony.  At the end of the contested hearing, the Board meets in executive session to make its decision on the outcome.  Board decisions are appealable to the administrative law court.  The outcomes from complaints can involve public and private reprimands, fines, suspension of privileges, and even revocation of the professional’s license.

If you have received notice of a complaint and would like assistance, please contact Doug MacKelcan at dmackelcan@cskl.law or 843-266-8228.  Likewise, if you have any questions in general about LLR complaints, I will be happy to speak with you.