On Wednesday, July 9, 2025, the California Supreme Court issued an order suspending attorney William Taylor Carss from practicing law in California for one year, with the suspension stayed and Carss placed on probation for one year. The decision follows a stipulation approved by the State Bar Court on April 14, 2025, addressing Carss’s professional misconduct related to his role at Phoenix Law, PC, a debt resolution law firm.
The case is entitled “In the Matter of William Taylor Carss,” with case number S290778.
The Supreme Court’s order mandates a six-month actual suspension during the probation period. Carss must also comply with additional probation conditions outlined in the State Bar Court’s stipulation, including passing the Multistate Professional Responsibility Examination and adhering to California Rules of Court, Rule 9.20, which requires notifying clients and others of his suspension within specified timelines.
The disciplinary action stems from Carss’s tenure as the managing attorney of Phoenix Law. According to the State Bar Court’s stipulation, Carss was unknowingly drawn into a scheme orchestrated by Tony Diab, a disbarred attorney acting as a consultant.
Carss believed a Pennsylvania law firm, Phoenix Law, initially hired him in October 2022 to manage its Irvine, California office. Unbeknownst to him, Diab operated this office without the Pennsylvania firm’s authorization and later transferred approximately 20,000 client files from Litigation Practice Group, PC (LPG), another entity Diab controlled, to Phoenix Law without Carss’s consent.
The State Bar Court found Carss in violation of two professional conduct rules. First, he allowed Diab, a nonlawyer, to control Phoenix Law’s operations, breaching Rule 5.4(d)(2), which prohibits nonlawyers from acting as directors or officers of a law corporation.
Second, Carss failed to deposit approximately $2.5 million in unearned attorney fees, collected via Automated Clearing House payments from Phoenix Law’s clients in May 2023, into a client trust account, violating Rule 1.15(a). These fees were transferred to entities controlled by Diab and not held in a trust account.
Mitigating factors cited in the stipulation include Carss’ 21 years of discipline-free practice prior to the misconduct, his cooperation with the State Bar and the Chapter 11 Bankruptcy Trustee, and a prefiling stipulation acknowledging his wrongdoing. Carss also provided 15 character references from friends, lawyers, family, and a client, attesting to his integrity and professionalism. No aggravating circumstances were noted.
In June 2023, the Bankruptcy Court issued a Temporary Restraining Order, and the Chapter 11 Trustee seized the $2.5 million in unearned fees. Carss cooperated fully, assisting the Trustee in recovering client files and ensuring continued representation for LPG’s clients. By August 2023, LPG’s cases were sold to Morning Law Group, where Carss now works as a managing attorney.
The Supreme Court’s order emphasizes compliance with probation conditions, warning that failure to meet these requirements, including passing the ethics examination or fulfilling notification duties, could lead to further suspension or disbarment.
According to Avvo, Mr. Carss is a criminal defense lawyer in San Marcos, CA. He acquired his law license in California in 2002.
A copy of the original filing can be found here.
