October 13, 2008
Convictions Lead To Suspension
The Louisiana Attorney Disciplinary Board has recommended a suspension of one year and one day of an attorney, currently on inactive status, for her conviction of making threatening telephone calls and stalking, the revocation of probation and court orders in connection with the convictions, and operating a motor vehicle while intoxicated. The victims of the misconduct had "suffered potential psychological and physical harm." The attorney suffers from alcoholism and other physical problems. The board, in line with court precedent, declined to consider conditions of reinstatement until such a petition is filed and adjudicated. (Mike Frisch)
October 12, 2008
Greed, Fear, and Morality: Walking and Chewing Gum?
Posted by Jeff Lipshaw
I'm off to Springfield, Massachusetts at the end of the week to participate in the Entrepreneurship in a Global Economy symposium at Western New England College's Law and Business Center for Advancing Entrepreneurship. I will be discussing my somewhat contrarian and deliberately provocative essay "Why the Law of Entrepreneurship Barely Matters."
A while back I wrote a lumbering piece with a point that seems to me more apparent now than it did when I published it in 2005: the law (I was focusing on contract law) is not a particularly good tool for addressing radical uncertainty. When it comes time to make difficult predictions about a highly contingent future, the process of judgment is so complex that it overwhelms the law's linguistic model. Imagine writing a contract that depends on the twentieth move of a game of chess that has yet to begin. In theory, it's possible, but in practice, we still don't know if it's merely impractical or impossible. And chess is simple compared to life.
I have joked over and over again (I apologize for it) that I like to work at the intersection of Kantian philosophy and venture capital, and Thomas Friedman's column in today's New York Times brought me back to the thesis. He quotes a friend to the effect that nature is just chemistry, biology, and physics, and you can't spin it, bribe it, or sweet talk it. In Kantian terms, that is the heteronomous world in which we live, of physical cause-and-effect of which we must necessarily be a part. Friedman's point is the same one I tried to make in a late footnote to the lumbering piece: markets are very much the same as nature. "At their core markets are propelled by fear and greed. They're just the balance at any given moment of those two impulses." I believe that as well. There's little that is moral about markets, just as there is little that is moral about physics. Nor do we really, after all is said and done, want to eliminate fear and greed. It's what sustains our bodies, and Kant was enough of an empiricist, I think, to believe that if there was a soul, the only way you could know anything about it was because it was housed in a body. Or to put it in terms of Jewish lore: we have a "bad" impulse, the yetzer hara, by which we lust and amass, and a good impulse, the yetzer tov, by which we love and contribute, and we can't live (or live well) without either of them. The Aristotelians looking for a golden mean should like this as well. In present terms, it leaves me equally repulsed by unrepentant free market apologists and by blame-seeking moralists. (The need to "blame" somebody for the current crisis is an interesting exercise in teleology as well, but that is for another time. Suffice it to say that innocent people losing savings in market crashes is as almost as troubling as innocent people dying in airplane crashes, and reconciling either one is a tough philosophical issue.)
What does this have to do with entrepreneurship? Again, to quote Friedman on the coming global workout of this credit bubble: "The workout promises to be painful, complicated, and protracted. Government will have to do its part. But it must regulate the excesses without smothering the underlying innovative, entrepreneurial and risk-taking attributes of our economy, which are what will ultimately bail us out - as they always have."
So my project as a business person and lawyer of some worldly experience, and as a teacher of lawyers, has been a tad contrarian: suggesting to business lawyers that they ought to approach their task with some amount of modesty about their role in dealing with radical uncertainty. (It's hard to get a feel for what I mean if all you do is read cases, or even litigate cases. That is merely structured second-guessing.) The lawyer's role not trivial, but it's not the be-all that law and economics would suggest by the notion of an "incomplete contract" (think back to my chess example) as though the idea of a complete contract does any helpful intellectual work at all. And that's just law! Ethics is another ball of wax. Unless the proposal is that we go back to pre-Industrial Revolution agrarian society, somebody has to make our iPods and laptops and hybrid cars and get all that stuff to Whole Foods, and industry, even when it's done well and responsibly, is a dirty business that calls on us to make tough choices.
What I really love about the juxtaposition of lawyers and entrepreneurs is this jarring contrast in the approach to uncertainty. At the behest of my son, I've been wading through Gore Vidal's dense historical novel, Burr. Burr was a practicing lawyer to the end of his life, and, in the novel, the young clerk in his office who narrates the story wants to know if he should take the bar exam. Burr says he should because he will certainly pass. The narrator replies, "But I don't want to be a lawyer." Burr responds, "Well, who does? I mean what man of spirit? The law kills the lively mind. It stifles originality. But it is a stepping-stone. . . ." Why does the micro-law of entrepreneurship barely matter? Because it can barely contain the wide-ranging orientation to change and innovation in the face of uncertainty that is the mark of an entrepreneur. Effective lawyers to entrepreneurs, like effective lawyers to business people, and like effective ethicists dealing with the workings of amoral markets, have to be able to walk and chew gum.
I Now Pronounce You...
A recent judicial ethics opinion from Massachusetts holds that a judge may serve as a justice of the peace for the sole purpose of conducted a marriage ceremony:
Performing marriages does not implicate any policy making role, has no political agenda and requires no advocacy. The ability to harmonize the judicial role with serving as justice of the peace, at least for the purpose of solemnizing marriage, is further bolstered by Article II of the Massachusetts Constitution, which provides that "No governor, lieutenant governor, or judge of the supreme judicial court, shall hold any other office or place, under the authority of this commonwealth,...saving that the judges of the said court may hold the offices of justices of the peace through the state..." Similarly, Article VIII provides that "judges of the courts of common pleas shall hold no other office under the government of this commonwealth, the office of justice of the peace and militia offices excepted." This language also reflects an understanding that the role of judge is not inconsistent with holding the role of justice of the peace.
An attorney who was convicted of a number of criminal offenses in New Jersey relating to the conversion of a $75,000 settlement was suspended for three years by the New York Appellate Division for the First Judicial Department. The conviction is described in the court's opinion:
...respondent was convicted, after a jury trial, in Superior Court of the State of New Jersey, Union County, of one count of theft by failure to make required disposition of property in the third degree (NJ Stat Ann § 2C:20-9), one count of misapplication of entrusted property in the third degree (NJ Stat Ann § 2C:21-15) and two counts of forgery in the fourth degree (NJ Stat Ann § 2C:21-1a, ). He was sentenced to three years' probation, 500 hours community service, and a fine of $5,000, plus assessments.
Respondent's theft convictions resulted from his failure to pay certain clients their $50,000 portion of a $75,000 settlement payment, received in January 1999 in connection with the settlement of the clients' wrongful death action relating to the death of their son. Respondent deposited the $75,000 check into his attorney trust account, which had a balance of $250 the previous day. Respondent then depleted most of the funds in the escrow account within two days, by writing checks to pay clients and other firm obligations. The forgery convictions were based on his forgery of the clients' signatures on the settlement check, which was made payable to respondent's law firm and the two clients. Respondent eventually made payment of the $50,000 to his clients in December 1999, but only after he became aware of a police investigation into his conduct. After an ethics investigation was commenced, respondent consented to his immediate and temporary suspension in New Jersey in 2000.
The attorney was suspended in New York on an interim basis in 2003. The conviction, except for the forgery, was reversed on appeal because ethics rules were submitted to the jury without proper instructions. A referee recommended a suspension in New York that would have reinstated the attorney, which the court rejected in favor of a suspension that will run from the date of the decision here.
The Referee's recommended sanction of a three-year retroactive suspension to January 2004, which would have already expired in January 2007, is too lenient. While a two-year suspension might be appropriate if the misconduct was limited to the forgery, respondent's additional misconduct in making false representations to his clients and his temporary use of such funds to pay personal or firm obligations warrants a more severe sanction. Also relevant is respondent's minimal expression of remorse, since it provides this Court with a basis to evaluate whether respondent is deserving of a chance to practice law again in this State in the near future. In sum, having considered respondent's convictions of the serious crimes of fourth-degree forgery, his misrepresentations and use of escrow funds, and the aggravating and mitigating circumstances previously mentioned, we conclude that a suspension of three years is the appropriate sanction.