Thursday, September 30, 2010
The North Dakota Supreme Court has held that Rule 4.2, which forbids unauthorized communication with a represented party, applies to an attorney who is pro se in the matter:
[The attorney] argues he did not violate Rule 4.2 because the rule does not apply when an attorney is representing himself. His view is too narrow. The rule protects "a person who has chosen to be represented by a lawyer in a matter against possible overreaching by other lawyers who are participating in the matter, interference by those lawyers with the lawyer-client relationship, and the uncounseled disclosure of information relating to the representation." N.D.R. Prof. Conduct 4.2 cmt. 1. Most courts have held Rule 4.2 applies to attorneys representing themselves because it is consistent with the purpose of the rule. See In re Schaefer, 25 P.3d 191, 199 (Nev. 2001) ("The lawyer still has an advantage over the average layperson, and the integrity of the relationship between the represented person and counsel is not entitled to less protection merely because the lawyer is appearing pro se."); In re Segall, 509 N.E.2d 988, 990 (Ill. 1987) ("A party, having employed counsel to act as an intermediary between himself and opposing counsel, does not lose the protection of the rule merely because opposing counsel is also a party to the litigation."). In addition, we have recognized Rule 4.2 "is to prevent lawyers from taking advantage of laypersons." Disciplinary Bd. v. Hoffman, 2003 ND 161, ¶ 17, 670 N.W.2d 500.
[The attorney] relies on a Connecticut Supreme Court decision to argue Rule 4.2 does not apply when he is representing himself because he is not representing a client. In Pinsky v. Statewide Grievance Committee, the court held an attorney representing himself had a right to communicate with a represented party because he was not representing a client. 578 A.2d 1075, 1079 (Conn. 1990). Most courts have rejected Pinsky, reasoning "the policies underlying [Rule 4.2] are better served by extending the restriction to lawyers acting pro se." In re Haley, 126 P.3d 1262, 1267 (Wash. 2006) (discussing prior authority); see also Runsvold v. Idaho State Bar, 925 P.2d 1118, 1120 (Idaho 1996) ("We thus construe the phrase of Rule 4.2, 'in representing a client' to include the situation in which an attorney is acting pro se because this interpretation better effectuates the purpose of Rule 4.2."). We join the majority of courts in rejecting the rationale of the court in Pinsky.
We conclude that the reasoning of courts in In re Haley and Runsvold is more persuasive than Pinsky and that the majority position is more in line with our precedent and with our prior application of Rule 4.2 in the prior  case [involving the same attorney]. We therefore adopt the hearing panel's conclusion that Rule 4.2 applies to attorneys representing themselves.
The court imposed a 30 day suspension.
The Chief Justice would impose a reprimand:
Although [the attorney] had been reprimanded previously for similar action, [he] petitioned this Court to review the hearing panel's decision. We denied the petition and did so by order and without explanation. This Court does not grant leave to appeal an informal decision "unless the person seeking leave to appeal shows that the board acted arbitrarily, capriciously, or unreasonably." N.D.R. Lawyer Discipl. 3.1(D)(8). Nevertheless, it is only now, in the majority opinion, that "We join the majority of courts in rejecting the rationale of the court in Pinsky" and "We conclude that the reasoning of courts in In re Haley and Runsvold is more persuasive than Pinsky and that the majority position is more in line with our precedent and with our prior application of Rule 4.2 in the prior Lucas case."
Perhaps [the attorney] should have been able to glean the fact we disagreed with his interpretation of Rule 4.2 from our order denying his petition to appeal the public reprimand. However, that public reprimand concerned Rules of Professional Conduct in addition to Rule 4.2. I believe that [his] failure to grasp the significance of the order denying his petition to appeal is why the hearing panel in this instance found [his] action was more negligent than intentional. For that reason, as well as the other reasons cited by the hearing panel, I would impose a public reprimand rather than suspension.
The Ohio Supreme Court web page reports a decision yesterday:
[A] Toledo attorney has been permanently disbarred by the Supreme Court of Ohio for multiple violations of state attorney discipline rules arising from his involvement in a criminal conspiracy that induced approximately 3,000 real estate agents and appraisers to join two professional organizations with the false promise that their membership dues purchased errors-and-omissions insurance coverage that did not in fact exist.
In a 5-2 per curiam opinion, the Court adopted findings by the Board of Commissioners on Grievances & Discipline that between 1997 and 2001 [the attorney] induced real estate professionals to purchase memberships in the American Real Estate Association (AREA) and the Noble Group by falsely representing that as a benefit of membership they would receive errors-and-omissions insurance coverage from Midwest Insurance Company. During the investigation of his misconduct, [the attorney] admitted that Midwest, an offshore entity formed by one of his co-conspirators, was never licensed to provide insurance in the United States, and the promised errors-and-omissions policies never existed.
In imposing the ultimate sanction of permanent disbarment, the Court noted that while [he] voluntarily ended his involvement in the scheme in 2001, he did nothing to stop or alert law enforcement officials to the ongoing fraud, which continued for several years until it was discovered by federal authorities. In 2006 [he] entered a guilty plea to a felony count of conspiracy to commit wire fraud and mail fraud. He was subsequently sentenced to one year and one day in federal prison and three years of supervised release and ordered to pay $3.7 million in restitution. His law license has been on inactive status since January 2007.
The Court rejected objections raised by [the attorney] to the severity of his sanction, pointing to the long period of time he participated in the conspiracy, the large number of fraudulent transactions in which he was involved and the cumulative financial damage suffered by thousands of victims.
The majority opinion was joined by Justices Evelyn Lundberg Stratton, Maureen O’Connor, Terrence O’Donnell, Judith Ann Lanzinger and Robert R. Cupp.
Chief Justice Eric Brown entered a dissenting opinion, joined by Justice Paul E. Pfeifer, stating that he would impose the sanction originally requested by the Toledo Bar Association and recommended by the hearing panel that heard the charges against [the attorney], which was an indefinite suspension with no credit for the time his license was under interim suspension.
The court's decision is linked here. (Mike Frisch)
A rather remarkable reinstatement case decided today by the Wisconsin Supreme Court rejected an unfavorable recommendation and granted the return to practice of a former attorney. The court really could not point to much that favored reinstatement. The attorney had been a State Senator.
The findings below were entirely adverse--the petitioner had been suspended for four years and three months after a criminal conviction. He had denied that he had done anything wrong and was still under court supervision. He had been less than diligent on restitution. The referee had recomended against reinstatement. Nonetheless, the court found on de novo review:
We begin by acknowledging that some of Attorney...'s past conduct has been deeply flawed. He has been professionally disciplined and criminally prosecuted for that bad conduct. He has been less than forthcoming with information about his activities while under suspension. He has steadfastly maintained that he did nothing wrong and that his criminal prosecution was politically motivated. He appears to operate under the misapprehension that he is somehow entitled to reinstatement upon the expiration of his license suspension. Indeed, Attorney...'s approach to this entire reinstatement proceeding has made it a more difficult and time-consuming inquiry than it might otherwise have been.
However, we focus on the specific question before us today: Whether Attorney... has demonstrated by clear, satisfactory, and convincing evidence that his license to practice law should be reinstated at this time. After careful review of the entire record, we conclude the answer to this question is, "Yes."
This is so because the a disbarred attorney need not admit guilt to achieve reinstatement (the District of Columbia has taken a contrary view in the case of William Borders, convicted in the attempted bribery of Alcee Hastings) and a reinstatement is not a retrial of the criminal case. I agree, but so what?
The court's rationale in toto:
Attorney...is a high-profile individual whose criminal and professional misconduct has been well publicized. However, we must guard against a temptation to "re-try" the disciplinary case or revisit the criminal conduct for which Attorney...has been punished. At the same time, Attorney... is not "entitled to reinstatement" simply because the period of suspension has lapsed. (citation omitted)
Upon careful consideration of the entire record, we conclude Attorney...has met his burden of proof with respect to the elements necessary to justify reinstatement. We conclude Attorney...can safely be recommended to the legal profession, the courts, and the public as a person fit to be consulted by others as a lawyer.
That's a comfort.
This report on the court's decision comes from the Milwaukee Journal Sentinel.
I posted a month ago on its availability in Kindle; now its new paperback is at Amazon here. Auerbach argues that the legalization of U.S. Jewish thought over the past century, and especially lawyers taking the leadership positions, disserviced American Judaism. It is a very good follow up to his landmark Unequal Justice. [Alan Childress]
Tuesday, September 28, 2010
The New York Appellate Division for the First Judicial Department imposed a public censure on an attorney for a series of improper business transactions with his client. The facts:
The undisputed facts as found by the Referee and the Hearing Panel may be briefly summarized. In 1993, respondent formed the IAA [Independent Artists of America] on behalf of the dancers of the American Ballet Theatre, whom he had represented since 1979. He continued as counsel to the IAA based on a monthly retainer fee, which was $2,500 until 2005, when it was increased to $3,500. Respondent was given possession of the IAA's checkbook for its non-interest-bearing business checking account, on which he was a signatory.
In July 1997, respondent, who was facing personal financial difficulties, asked the IAA's vice president, Lori Wekselblatt, for permission to borrow funds from the union's checking account. Shortly thereafter, Ms. Wekselblatt informed respondent by telephone that he could borrow funds from the checking account. In these conversations, respondent did not specify the amount or terms of the anticipated loan, nor did he advise Ms. Wekselblatt or any IAA officer that his interest differed from that of the union, that he could not give the union advice concerning the loan due to the conflict of interest, or that they should consult with independent counsel concerning the transaction. Respondent also failed to prepare any writing to document the loan or its terms.
From July 1997 until April 2005, respondent drew 47 checks payable to himself on the IAA's business checking account, withdrawing a total of $368,570.61. Although the loan agreement was not reduced to writing, the loans were disclosed in the IAA's annual tax returns and Labor Department filings. Those documents stated that the respondent would repay the loans by foregoing his monthly retainer, which he last drew in September 1998.
In November 2006, after another attorney alerted him to the requirements of DR 5-104(A), respondent sent Ms. Wekselblatt a loan agreement and promissory note for her signature, which stated that he then owed the IAA $145,348.53, together with five percent annual compound interest on unpaid balances. Ms. Wekselblatt did not sign the documents, telling respondent that she did not agree that he owed interest. As at the inception of the loans, respondent failed in proffering the after-the-fact loan documentation (which also included a payment schedule and a confession of judgment) to advise the IAA that a conflict of interest existed and that the union should consult independent counsel.
In May 2007 (about two years after the last loan was taken), the IAA formally discharged respondent as its counsel. At the request of the Hearing Panel in these proceedings, respondent executed a loan agreement and promissory note, dated May 11, 2009, committing himself to repay the principal amount of $67,500, with interest thereon of $47,277.53. Although the IAA has declined to sign this document, the Hearing Panel deemed it to constitute "an undertaking by [r]espondent to repay the amounts due according to the schedule provided and subject to the penalties offered.
The case is linked here. (Mike Frisch)
Posted by Jeff Lipshaw
Robert Hillman (UC Davis) and Allison Rhodes (Hinshaw & Culbertson LLP) have posted Client Files and Digital Law Practices: Rethinking Old Concepts in an Era of Lawyer Mobility, 43 Suffolk U. L. Rev. 897 (2010), on SSRN. Here's the abstract:
The lawyer or law firm that controls client files has distinct advantages in any competition for clients. Not surprisingly, disputes over control and possession of client files have long occupied the attention of courts and ethics committees, which over the years have developed a significant body of case law and ethics opinions addressing myriad issues relating to client files. Existing guidance, however, largely is directed to a world of “hard copy” files where pieces of paper neatly assembled within file folders invite a property-based analysis whenever disagreements over possession or access arise.
This article discusses the effects of digitizing client files and firm information in light of lawyer mobility and evaluates the existing framework of law and ethics developed largely in a world of hard copies. The article also offers some practical suggestions for firms seeking to assert greater control over client information and firm intellectual property.
The web page of the Ohio Supreme Court reports:
The Supreme Court of Ohio held today that Ohio recognizes a common law “self protection” exception to attorney-client privilege that permits an attorney to testify concerning attorney-client communications where such testimony is necessary to establish a claim for legal fees on behalf of the attorney or to allow an attorney to defend against a charge of malpractice or other wrongdoing in litigation between the attorney and a client.
The Court held further that attorney work product including mental impressions, theories and legal conclusions are subject to discovery upon a showing of good cause if the information sought to be discovered is directly at issue in the case, the need for the information is compelling, and the evidence cannot be obtained elsewhere.
The Court’s 6-0 decision, authored by Justice Terrence O’Donnell, reversed a ruling by the 8th District Court of Appeals.
From 2003 to 2007, the Cleveland-based law firm of Squire, Sanders & Dempsey (SSD) represented Givaudan Flavors Corporation in product liability litigation. In 2007, Givaudan severed its relationship with SSD and retained new outside counsel. SSD billed Givaudan for $1.8 million in unpaid legal fees. When Givaudan refused to pay, SSD filed suit. Givaudan filed a counterclaim alleging that SSD had overbilled for services it had performed, had billed Givaudan for services that were never performed, and had engaged in other false, deceptive and unethical business practices during the period of representation.
During the pretrial discovery process, Givaudan refused to produce any of the billing records or other documents relating to the legal services SSD had provided during its representation, or to answer most of the questions posed to company officials by SSD during depositions. Givaudan also asserted that because communications between itself and the law firm during the period of representation were exempt from disclosure under the attorney-client privilege, SSD was barred from disclosing documents in its own files that included communications between the law firm and Givaudan. SSD asked the trial court to order Givaudan to comply with its discovery requests and respond fully during depositions in the case.
The trial court granted the motion to compel discovery, holding that a common law exception to the statutory attorney-client privilege set forth in R.C. 2317.02 allows disclosure of otherwise confidential communications when such disclosure is necessary to the fair adjudication of a lawsuit between a lawyer or law firm and a client arising from their business relationship. Givaudan appealed that ruling.
On review, the 8th District Court of Appeals reversed the trial court’s order compelling Givaudan to comply with SSD’s discovery requests. In its opinion, the court of appeals held that the trial court erred in recognizing a self-protection exception to attorney-client privilege, and that communications between SSD and Givaudan during the period of representation were privileged under R.C. 2317.02(A) and were not subject to discovery or disclosure at trial unless SSD could show that Givaudan had waived the privilege either by giving express consent to disclosure or by voluntarily testifying about those communications. SSD sought and was granted Supreme Court review of the 8th District’s decision.
In today’s decision, the Supreme Court reversed the 8th District and reinstated the trial court’s order compelling discovery of communications between Givaudan and SSD during the period of representation. Justice O’Donnell noted that Ohio courts have recognized several exceptions to the attorney-client privilege codified by R.C. 2317.02(A) notwithstanding their absence from the text of the statute. As examples, he pointed to the “crime-fraud” exception that bars use of attorney-client privilege to conceal an attorney’s cooperation with a client’s wrongdoing; the lack-of-good-faith exception that prevents an insurer from using attorney-client privilege to conceal its bad-faith denial of a claim pursuant to state insurance statutes; and the joint-representation exception that prevents one co-litigant from using attorney-client privilege to conceal information from another party represented by the same attorney in the same case.
With regard to the “self-protection” exception at issue in this case, Justice O’Donnell wrote: “The self-protection exception dates back over 150 years to its articulation by Justice Selden in Rochester City Bank v. Suydam, Sage & Co. (N.Y.Sup.Ct.1851) … There, he wrote, ‘[w]here the attorney or counsel has an interest in the facts communicated to him, and when their disclosure becomes necessary to protect his own personal rights, he must of necessity and in reason be exempted from the obligation of secrecy [sic].’ (emphasis added in part.) Since that time, this exception has become firmly rooted in American jurisprudence. The Supreme Court of the United States recognized it in Hunt v. Blackburn (1888) … and courts and commentators have accepted the self-protection exception as black-letter law defining which communications are subject to the attorney-client privilege.”
“Notably, Ohio courts, including this court, have recognized the self-protection exception. In Estate of Butler (1939) the beneficiaries of the estate of Henry V. Butler challenged the administrator’s payment of legal fees to Butler’s attorney, Grover C. Brown. The probate court struck Brown’s testimony regarding the services he rendered to Butler as privileged pursuant to G.C. 11494, the predecessor to R.C. 2317.02(A). The court of appeals reversed, holding that ‘an attorney in matters pertaining to his interest has a right to testify and is not precluded from doing so by virtue of [G.C.] 11494. The rule is very broad which permits testimony of an attorney in support of his claim for fees.’ …We affirmed that decision, explaining that ‘[s]ince the administrator was charged with maladministration in the allowance and payment of Brown’s claim against the estate, the defense of the administrator was dependent upon establishing the correctness of the claim by showing the amount and value of the services which Brown had rendered to Butler. … We noted that ‘the testimony of Brown (should not) have been wholly excluded on the ground that he had been counsel and attorney for Butler.’”
“Further, the self-protection exception to the attorney-client privilege permitting the attorney to testify also applies when the client puts the representation at issue by charging the attorney with a breach of duty or other wrongdoing … (A) client may not rely on attorney-client communications to establish a claim against the attorney while asserting the attorney-client privilege to prevent the attorney from rebutting that claim. Rather, ‘the attorney-client privilege exists to aid in the administration of justice and must yield in circumstances where justice so requires,’ … The same considerations of justice and fairness that undergird the attorney client privilege prevent a client from employing it in litigation against a lawyer to the lawyer’s disadvantage.”
The Court also rejected Givaudan’s claim that SSD was barred by the privilege conferred on attorney work product from deposing Givaudan’s in-house corporate counsel, Frederick King and Jane Garfinkel, regarding the basis for their judgments that SSD was not providing effective legal representation and had overcharged for its services.
Justice O’Donnell wrote: “When the attorney-client relationship has been put at issue by a claim for legal fees or by a claim that the attorney breached a duty owed to the client, good cause exists for the production of attorney work product to the extent necessary to collect those fees or to defend against the client’s claim. … Thus, attorney work product, including but not limited to mental impressions, theories, and legal conclusions, may be discovered upon a showing of good cause if they are directly at issue in the case, the need for the information is compelling, and the evidence cannot be obtained elsewhere. Here, attorney work product, including information sought from King and Garfinkel regarding the staffing of the butter-flavor litigation, trial strategy, resources committed, and views that the firm provided inadequate representation through counsel lacking sufficient leadership, qualification, and experience, is directly at issue, as the reasonable value of the legal services performed by Squire Sanders and the quality of its legal work are the pivotal issues in this lawsuit, and the need for this evidence is compelling.”
“ … This information is otherwise unavailable to Squire Sanders because it is within the exclusive possession and knowledge of Givaudan, King, and Garfinkel. Accordingly, testimony of King and Garfinkel and documents related to the value and quality of the legal services rendered by Squire Sanders are not protected from discovery in this case by the work-product doctrine.”
Justice O’Donnell’s opinion was joined by Justices Paul E. Pfeifer, Evelyn Lundberg Stratton, Maureen O’Connor and Robert R. Cupp.
Justice Judith Ann Lanzinger entered a separate opinion concurring with the Court’s judgment but disagreeing with the distinction drawn by the majority between exceptions to and waivers of the attorney client privilege. She wrote: “(I)n its attempt to distinguish waiver from exception, the majority uses overly broad language and declares that an exception ‘falls into the category of situations in which the privilege does not attach to the communications in the first instance and is therefore excluded from the operation of [R.C. 2317.02.]’ What the majority fails to recognize is that an exception, like a waiver, arises because of some action taken by the client. It is only when the client puts the attorney’s representation at issue that the privilege no longer applies. The majority, however, would retroactively apply that action and hold that the privilege never existed. Because I believe that common-law exceptions are really no different than common-law waivers, I concur in judgment only.”
Chief Justice Eric Brown did not participate in the court’s deliberations or decision in the case.
The court's opinion is linked here. (Mike Frisch)
Monday, September 27, 2010
An attorney who had converted entrusted funds was disbarred by the Massachusetts Supreme Judicial Court, notwithstanding his recovery from drug addiction:
I agree with the board that even if one were to consider addiction to illegal drugs as a "disability" and a mitigating factor, this is not a case where the factor would change the outcome. The respondent's failure to pay back any part of the funds owed to the client, even after he had been treated, apparently successfully, for his drug addiction, argues in favor of disbarment. See Matter of Dasent. 446 Mass. 1010, 1012-1012 (2006) ("It is established that, where a respondent has intentionally misused client funds, and failed to pay his client all that was due to her, the usual and presumptive sanction is disbarment"). Contrast Matter of Collins, 455 Mass. 1020 (2010) (attorney, who had been addicted to cocaine, completed rehabilitation programs, self-reported misappropriation of client funds to bar counsel, and had paid back more than half amount owing at time of disciplinary proceedings; indefinite suspension ordered with requirement for restitution of remaining amount owed). This conclusion is particularly true when the respondent's other charged and admitted misconduct is factored in, all of which occurred after his addiction had been treated and which his expert witness was unable to say was causally related to the expert's diagnosis of bipolar disorder.
The respondent and his counsel are correct that this is a sad case, and that he is to be commended for remaining drug- and alcohol-free since 2007. But in the circumstances presented, I agree with the board and the hearing committee that disbarment is the appropriate sanction.
The attorney had a separate practice located in his father's law office. (Mike Frisch)
An attorney who had failed to properly pursue an estate matter has been publicly reprimanded by the Oregon Supreme Court:
...By failing repeatedly to appear in court for scheduled hearings, and by failing to file an inventory or an accounting, the accused unreasonably prolonged the conservatorship proceeding. As in Gresham, the accused's inaction created an unnecessary burden on court resources. At the trial panel hearing, the trial court judge testified that the accused's failure to advance the conservatorship proceedings affected the court's procedural efficiency and impaired the court's ability to supervise the conservatorship and protect [his client]. In addition, the accused's inaction harmed the substantive interests of his client and her husband. Because of the accused's continued failure to file an inventory and final accounting, the court removed [the wife] as conservator and the accused as attorney. As a result, the conservatorship estate incurred unexpected attorney fees. We conclude that the accused's cumulative inaction during the course of the conservatorship proceeding prejudiced the administration of justice...
The accused is publicly reprimanded.
The court also addresses the procedures applicable when the attorney does not appeal to the Court. (Mike Frisch)
Friday, September 24, 2010
The Illinois Administrator has filed a complaint alleging that an attorney falsely claimed to be suffering from cancer in order to induce a client to purchase a residence for her benefit:
In or prior to 2006, L...allowed Respondent to reside in a home [she] owned, at 1530 Tower Road in Winnetka (the "Winnetka house") under the terms that Respondent would pay rent and other expenses normally paid by tenants and L. would pay the expenses normally paid by landlords. At the time Respondent resided at the Winnetka house, L. had moved out of state and was residing in La Jolla, California.
In or about 2006, Respondent told L. that she was suffering from cancer and needed a place to live near her cancer treatment center in Evanston.
Respondent's statements to L. that she was suffering from cancer were false, and Respondent knew they were false because she never had cancer. Respondent's statements to L. that she was suffering from cancer were made for the purpose of inducing L. to purchase a house in Evanston to be used for Respondent's benefit.
In or about 2006, in reliance upon Respondent's statements as set forth...above, L.decided to sell the Winnetka house and use some of the proceeds from the sale to purchase a smaller house in Evanston where she would allow Respondent to reside as a tenant under the terms similar to that for the Winnetka house.
Respondent acted as L.'s attorney for the sale of the Winnetka house and the purchase of the Evanston house.
By reason of the trust and confidence that L. placed in Respondent pursuant to the attorney-client relationship, Respondent stood in a position of a fiduciary to L. As such, Respondent owed L. the fiduciary duties attendant to the attorney-client relationship, including the duty to perform the requested services with the highest degree of honesty, fidelity, and good faith, a duty of undivided loyalty, a duty to avoid placing herself in a position where her interests would conflict with the interests of her client, and a duty of care, including but not limited to a duty to ascertain if the actions she was taking on behalf of L. accurately reflected Lenore's desires and protected L.'s legal interests.
It is alleged that the Evanston house was to be titled solely in L.s name. The attorney had a warranty deed issued in her name and executed a fraudulent $150,000 mortgage, stealing the proceeds.
The client was forced to sue the attorney to clear title to the property.
It is further alleged that the attorney failed to cooperate in the bar investigation. (Mike Frisch)
Thursday, September 23, 2010
The Oklahoma Supreme Court has imposed a public reprimand and costs in a case involving the failure to properly supervise a non-lawyer employee. The court opinion provides a useful discusion of the rule and the basis for its conclusions concerning the violation:
A lawyer is duty-bound to supervise the work done by lay personnel and stands ultimately responsible for work done by the entire nonlawyer staff. The work of unlicensed personnel for a lawyer is done by them as agents of the lawyer who employs them. It is the lawyer who must exercise complete, though indirect, professional control over the actions of the employees. A lawyer has the ultimate responsibility to ensure that the internal processing system of his office is in compliance with his professional obligations. A licensed legal professional who fails properly to supervise unlicensed personnel is guilty of dereliction of duty. ORPC Rule 5.3. Violating the Rules of Professional Conduct through the acts performed by another is professional misconduct under ORPC Rule 8.4(a).
Respondent's utter failure to supervise any of Wingo's work activities not only enabled Wingo to misrepresent respondent's individual involvement in the case but also to engage in the unauthorized practice of law by performing legal services in the form of legal research, the alleged preparation of a motion for postconviction relief and of a petition for writ of certiorari to the United States Supreme Court without proper supervision by a licensed lawyer. Respondent's dereliction violated ORPC Rule 5.5(b), which provides that "a lawyer shall not . . . assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized practice of law."
The vicarious responsibility of a lawyer subjects that professional both to private-law (civil) liability as well as to the Bar's disciplinary process of public law. Today's opinion deals exclusively with the respondent's breach of his public-law duty as a member of the Bar. A disciplinary dereliction that comes under the rubric of a lawyer's breach of vicarious professional responsibility may not be treated as less serious than one of the same nature which was brought to enforce a practitioner's personal disciplinary responsibility by his own act or omission. Both breaches must be dealt with as being of equal seriousness. The discipline to be imposed for these derelictions should not vary one iota if the facts are identical. We must hence look at the respondent's breach in the same light as we would if this case were here to enforce his own disciplinary offense rather than his vicarious responsibility for breach by a third party acting as respondent's agent. In short, although the respondent was not the actor, the act in suit is imputed in law to his own doing. The gravity of the breach is equal to that which would apply if committed individually by the respondent's own act or omission.
Simply and concisely stated, a lawyer's vicarious public-law liability, in the context of a disciplinary bar proceeding, means that all licensed lawyers are fully and absolutely accountable for all breaches of professional ethics committed not only by fellow lawyers in the law firm, but also by those persons who are unlicensed or lay employees of a lawyer or of an association of lawyers in a single firm, regardless of the firm's name or of its precise legal entity.
The record shows that respondent fell woefully short of his obligation to supervise a nonlawyer employee in the operation of a business that provided legal support and research services under respondent's name and to make reasonable efforts to ensure that Wingo's conduct was compatible with the respondent's professional obligations as a licensed practitioner. By his utter dereliction of duty respondent made the offense possible. He gave the offender a home from which to harm innocent people. While respondent may be an entirely innocent victim of a designing employee, that does not reduce his culpability in law one iota. He is vicariously liable in disciplinary responsibility for all the misdeeds of his unlicensed employee which went unnoticed until the victim complained.
There are not a lot of cases that discuss the supevisory obligations of attorneys. This one may serve as a teaching tool. (Mike Frisch)
From the web page of the Ohio Supreme Court:
The Supreme Court of Ohio has suspended the license of [a] Warren attorney...for two years, with the second year of that term stayed on conditions, for professional misconduct in his handling of legal matters entrusted to him by two sets of clients and for failing to promptly cooperate with disciplinary authorities investigating the grievances filed against him.
In a 6-1 per curiam opinion announced today, the Court adopted findings by the Board of Commissioners on Grievances & Discipline that [he] obtained and then defaulted on a $13,000 personal loan from an elderly client of his law practice, and drew up a trust agreement for the same client that named [the attorney's] five children as beneficiaries of the trust in violation of disciplinary rules that bar an attorney from accepting employment or entering into a business transaction with a client in which the lawyer’s and client’s interests may conflict.
The Court also found that in a separate case [the attorney] collected legal fees from two clients for whom he had prepared a guardianship application without first obtaining the approval of the local probate court. [He] was subsequently found by the probate court to have engaged in concealment of assets in the case, and ordered to refund $1,200 of the legal fees he had improperly collected from those clients.
The majority decision was joined by Chief Justice Eric Brown and Justices Paul E. Pfeifer, Evelyn Lundberg Stratton, Terrence O’Donnell, Judith Ann Lanzinger and Robert R. Cupp. Justice Maureen O’Connor dissented, stating that she would impose a two year suspension with no portion stayed.
The court's opinion is linked here. (Mike Frisch)
Wednesday, September 22, 2010
The Oklahoma Supreme Court has granted admission to an attorney who was issued a special temporary permit to practice with the state Department of Agriculture in 1997 and was admitted in Arkansas in 1992.
A dissent would require the applicant to take and pass the bar exam:
[The applicant's] Special Temporary Permit was granted to her on November 12, 1997, for the purpose of obtaining employment with the Oklahoma Department of Agriculture. See Rule 2, Section 5, Admission Rules. We assume that she has remained in the same employment under the same permit since that time. At the time Ms. [she] applied for her special temporary permit, she was a licensed attorney in good standing in the state of Arkansas. She was admitted to the Arkansas Bar in 1992.
In her current application for membership in the Oklahoma Bar Association pursuant to Rule 2, [she] has provided evidence of her good standing as a member of the Arkansas State Bar. However, she has failed to provide evidence that she has been "engaged in the actual and continuous practice of law for at least five of the seven years immediately preceding application for admission under this Rule" in a reciprocal state which is a requirement for admission upon motion. See Rule 2, Section 1. Her experience in Oklahoma will not fulfill this requirement. See Rule 2 of the Admission Rules, Section 4.
On July 2, 2009, this Court amended Article II, Section 5 of the Rules Creating and Controlling the Oklahoma Bar Association. Section 5(E) was added and provides for an annual renewal of special temporary permits issued under Rule 2, Sections 5 and 6 of the Admission Rules. See section 5(E)(1).4 Section 5(E)(2) provides that special temporary permits granted prior to the promulgation of this rule shall be deemed to have a renewal date of January 2, 2010. This Court has been advised by the Board of Bar Examiners that [she] has had a special temporary permit with the Oklahoma Bar since 1997, but it is unclear whether it was renewed. Unless a renewal fee was paid within the time limits of Section 5(E)(1), the permit should have been cancelled.
For decades, our rules have clearly stated that the only means available to attain full membership in the Oklahoma Bar Association is taking the bar examination. The only exception is the reciprocity provision under Rule 2. She should be required to register for the February, 2011 bar examination, pursuant to Rule 4 [Admission by examination]. The reciprocity provisions of Rule 2, Section 1, are not available to her. Otherwise, she will have become an active member of the Bar by using her special temporary permit to obtain legal experience in Oklahoma to avoid the requirement which we expect from all Oklahoma lawyers, i.e., taking the bar examination. The special temporary permit is not transformed into a license to practice law in Oklahoma merely because the permit holder has practiced many years in this state. This was not the intended purpose of Rule 2.
The materials presented to us also indicates this petitioner was issued a Bar card with an OBA number in 1997 which contravenes the rules in effect then and which continue in effect to this day. See Art. II, Section 5(E)(2), Rules Creating and Controlling the Oklahoma Bar Association, 5 O.S. Supp. 2009, Ch. 1, App. 1. I would therefore require the petitioner to surrender her Bar card and order her name stricken from the roll of attorneys until she has successfully passed the Oklahoma Bar Examination and the MPRE. I therefore respectfully dissent. (footnotes omitted)
An attorney who purchased 14,000 shares of stock in a firm client after learning confidential information from his law partner is the subject of a one-year suspension recommendation by the Illinois Review Board. The attorney also had falsely denied that he misused confidential information in making the purchases. He had used information learned from a partner's e-mail to purchase stock and realized a profit of almost $135,000.
The review board concluded that he had violated his duties of confidentiality and honesty and (over a dissent) engaged in criminal conduct that adversely reflected on his fitness to practice. The attorney had not been convicted of any criminal offense. He had been subject to a civil enforcement action and repaid double the amount of the stock sale profit as a penalty.
A hearing board had recommended a two-year suspension. The review board concluded that the sanction was unduly harsh:
The Hearing Board...declined to consider [the attorney's] family problems in mitigation. The Hearing Board discounted this evidence, reasoning that there was no real correlation between [his] misconduct and his family problems. In our opinion, the Hearing Board took too strict a view in assessing this evidence.
[The attorney] testified that he committed the acts in question because he was acting irrationally, in response to depression and problems that he was having with a teenaged daughter. [He] and his ex-wife testified in detail about serious problems affecting one of their daughters, beginning in July 2004 and continuing through at least May 2006, the time of [his] misconduct. Each testified that their daughter’s problems with drugs and problems brought about by persons with whom she was associating caused very significant emotional stress for the family. The family ultimately placed the young woman in remote residential treatment facilities, at significant expense.
[The attorney] sought and received treatment for depression between August 2005 and April 2006 and in October and November 2006. In addition, [his] father died, in December 2005, and [he] assumed responsibility for his late father’s affairs, out-of-state, which added additional stress. [He] testified that, as a result of these factors, he was not using his best judgment at the time of his misconduct. He testified that his "life was going down the tubes." The facts which [he] and his ex-wife described support that statement.
[His] very difficult family circumstances do not excuse his misconduct. They do, however, provide a framework from which to reasonably assess this respondent’s actions. These circumstances were ongoing at the time of [his] misconduct. A temporal connection between a respondent’s misconduct, ill mental health, and family problems is properly considered in mitigation. (citation omitted)
While we do weigh the mitigating factors differently than did the Hearing Board, they are not sufficient in this case to justify a lesser suspension than one year, given the facts of this case as a whole.
The majority questions the appropriateness of bringing the criminal conduct charge absent a conviction, notwithstanding governing case law that makes clear that conviction is not a necessary predicate to the violation. (Mike Frisch)
Tuesday, September 21, 2010
The Illinois Administrator has filed a complaint against an Assistant State's Attorney for Cook County alleging ethical violations in three closing arguments. The attorney also is charged with making a false statement as a candidate for judicial office. The complaint alleges:
In 2008, Respondent became a judicial candidate. She was running to be a Circuit Court of Cook County judge in a contested race in the November 4, 2008, Cook County general election to fill a vacancy in the 12th Subcircuit. As a candidate for judicial office, Respondent was required to refrain from conduct which, had she been a judge, would have been a breach of the Code of Judicial Conduct. Canon 2 of the Code of Judicial Conduct requires a judge to respect and comply with the law and to conduct herself at all times in a manner that promotes public confidence in the integrity of the judiciary.
On October 3, 2008, the Chicago Council of Lawyers ("Council") released a report evaluating the judicial candidates in the November 4, 2008, Cook County general election.
In its report, the Council found Respondent "Not Qualified" for the Circuit Court of Cook County, citing to numerous Appellate Court decisions that had been critical of Respondent’s conduct as a prosecutor as the basis for its conclusion that Respondent was not qualified to be a judge.
Following the Council’s report, internet blogger and attorney Jack Leyhane ("Leyhane") posted a link to the report on his blog, which was entitled, "For What It’s Worth," and which was located at www.leyhane.blogspot.com.
On October 24, 2008, Respondent sent an e-mail to Leyhane in which she stated that the Council report as it applied to her had been "dishonest" and "misleading" to the voting public. She went on to state the following:
The simple fact is that had they or anyone else asked or researched the truth about these accusations at all, they could find that I had a full and complete hearing in the ARDC, the board that regulates conduct and was completely cleared.
I have never flouted any court ruling or admonishment. This fact was recognized by no less august a tribunal than the ARDC…
At the end of her e-mail to Leyhane, Respondent stated that she hoped Leyhane would print her e-mail in his blog. She further stated that he was free to use her comments on his blog with her name attached.
On November 2, 2008, Leyhane posted Respondent’s e-mail, including the comments listed...above, in their entirety on his blog.
The statements made by Respondent...were false and Respondent knew they were false at the time she made them, because there is no method by which one can "research" whether confidential investigations have taken place at the ARDC, at no time had Respondent’s conduct been the subject of proceedings before the Hearing Board, let alone the "full and complete hearing" she claimed, nor had the Inquiry Board "recognized" that Respondent "never flouted any court ruling or admonishment," and at no time was she "cleared" of conduct by the ARDC.
The complaint alleges that the statements were false because the attorney had been admonished in 2006 for closing argument misconduct in three matters. (Mike Frisch)
An attorney convicted of a criminal offense was suspended for three months by the New YorkAppellate Division for the First Judicial Department. The court set out the facts:
On March 21, 2007, respondent was stopped by the Nassau County police, who impounded his car due to various outstanding motor vehicle infractions. Upon inspection the police found that the vehicle bore a registration sticker which had been forged to reflect an incorrect expiration date.
Respondent admitted to cutting out numbers from the registration sticker of his wife's car and affixing them to his own vehicle's registration sticker. Respondent also altered his car's registration sticker so as to make it reflect an inaccurate expiration date. Respondent knew his actions were illegal.
When stopped by the police, respondent was aware that his car had been uninsured for a year and a half and was not currently registered or inspected. He had been driving the car with a forged registration sticker since February 2004, knew that he was driving with a suspended license, had failed to answer a traffic summons and had outstanding motor vehicle infractions and violations.
Respondent testified that he no longer drives and instead commutes to his office by public transportation. He acknowledged that his conduct was wrong and proffered his wife's illness, marital turmoil and financial difficulties as the reasons forsuch conduct. In aggravation, the Hearing Panel considered respondent's failure to report his criminal conviction to the Committee as required by 22 NYCRR 603.12(f). The Hearing Panel also considered respondent's failure to provide it with proof of the satisfaction of a $20,610 New York State tax judgment as well as documentation of payments towards other outstanding liens and judgments entered against respondent. These outstanding liens and judgments include a $47,687 federal tax lien and judgments in the amounts of $4,834 and $20,146. The Hearing Panel also considered respondent's failure to notify his law firm employer of his conviction as evidence that he has not accepted responsibility for his misconduct. On the other hand, the Hearing Panel considered respondent's expression of remorse, the fact that his misconduct did not affect his law practice or cause harm to the public and the absence of a prior disciplinary record as mitigating factors.
Not a legal profession case, but of possible interest is a decision of the Vermont Supreme Court overturning a conviction for attempted voyeurism. The case involved upstairs and downstairs neighbors:
Complainant resides on the second floor of an apartment building located in a secluded area in Colchester, Vermont. There is a window in her bathroom shower that overlooks a parking lot used by residents of the building. The bottom of the window is at the level of complainant’s mid-chest. When complainant moved in, her landlord suggested that she cover the window with a shower curtain to protect the window from water damage. Complainant, however, did not do so. She did not think anyone could see her through the window.
Defendant is complainant’s neighbor who resides on the first floor. He can hear complainant’s shower turn on and off from his apartment. On September 1, 2008, complainant saw defendant for a few moments while he stood in the parking lot looking at her bathroom window as she was showering. On September 15, 2008, complainant again saw defendant standing in the parking lot looking at her bathroom window while she was in the shower. This time, defendant stared at her window for three minutes with a hand on his crotch. Complainant left the shower, went into her bedroom and took a picture of defendant—still looking up with a hand on his crotch—with her cell phone.
Later that day, complainant asked her roommate—who is the same height as complainant—to stand in her shower. Meanwhile, complainant went to the parking lot and looked up at her bathroom window to determine whether anyone could see her from the ground. The parties disagree on what complainant saw when she looked up at her window and whether defendant could see any part of complainant’s body that is protected by the voyeurism statute.
The defendant was not charged with attempted voyeurism, but the verdict camr after a jury note. As a concurring opinion explains:
As the majority notes, defendant was only ever charged with voyeurism. The charge of attempted voyeurism, upon which he was ultimately convicted, came about only after the jury had begun deliberating on the charge of voyeurism and appeared to conclude that defendant was not guilty of the charged crime, sending the judge a note asking, “If we think he is guilty of trying; but was not able to see her nipples. What kind of verdict do we give? We have not proven that he saw anything.” In his initial instructions to the jury, the judge had told them repeatedly that “if the state has not met its burden [of proving each and every element of an offense], then you must return a verdict of not guilty for the offense.” Why the judge did not simply repeat that basic principle of criminal law in response to the jury’s question remains a mystery to me. Rather, the court responded by providing the jury with an alternative theory of the case and instructed the jury on the crime of attempt. Neither the prosecution nor the defense had suggested this additional charge; defense counsel, in fact, strongly objected to it, arguing that such a change would be highly prejudicial and highlighting that she had not prepared for the new charge and would have changed her closing argument had she known such an instruction would be given.
The North Dakota Supreme Court imposed sanctions against an attorney who engaged in misconduct in three matters. In two of the matters, the court imposed a one-year suspension; in the other, disbarment.
One of the suspension cases:
...the Hearing Panel found that [the attorney] had billed one client for 9 hours and another for 16.39 hours at a rate of $150 per hour. The Hearing Panel found that the billed work was of no value, and when [he] was confronted by the other attorney in the firm, [he] refunded the money he had improperly billed to these clients. The Hearing Panel further found that [the attorney] had billed work that was of no value for two clients represented by the other attorney, who had been appointed by the U.S. District Court for the District of North Dakota. When confronted regarding bills paid by the Administrative Office of U.S. Courts, which included $5,400.40 for the work [the attorney] had billed, [he] indicated he would credit the payment for the entries on a final bill to the government. The Hearing Panel found that while [he]said he would credit the payment for the entries on a final bill to the government he has not done so; however [he] continued to work on the two files after the other attorney left the firm and there is a net balance owed to the firm.
And the disbarment:
... the Hearing Panel found that [the attorney] had asked his client to find cocaine for him, gave her $200 for the cocaine, and was subsequently arrested and charged. The record reflects that on January 20, 2010, [he] entered a guilty plea to Attempted Possession of Controlled Substance (Cocaine), which is a class A misdemeanor. Wolff was placed on supervised probation for two years, with conditions, and was ordered to pay fines and fees.
From the web page of the Pennsylvania Disciplinary Review Board:
The most used page at the Disciplinary Board’s Web site, www.padb.us, has always been the Attorney Search page. In the past, the page allowed users to search only for a single field, such as the attorney’s last name. This was a problem if the attorney you were searching for was named John Smith. You would have to work your way through 684 listings, 15 at a time, to arrive at the correct name.
This month, the Disciplinary Board rolled out a new version of the search which allows users to filter the database by any two fields, including first name, last name, county, city, or attorney ID number. Now, a search for “John Smith” can be narrowed down to a manageable list of 18 names. If you think there is an attorney named “Leonard” somewhere in Cumberland County, you now have a fighting chance of finding him. Users should also be aware that the search will yield all names that contain the search term. Thus a search for "Smith" will also display "Smithson" and "Goldsmith."
We hope this new enhancement will be more useful and efficient for those who rely on our site.
One of my (many) beefs with the D.C. Bar's web page is that you have to have the exact spelling of the attorney's name to get disciplinary information. At least the D.C. bar has a new and public-friendly feature-- you can now find the scheduled dates for proceedings before hearing committees and the BPR. Bravo for this improvement in access to information. (Mike Frisch)
The Indiana Supreme Court has issued a public reprimand to an attorney for failing to adequately communicate the basis for his fee.
The attorney is experienced in EEOC matters. His practice is to charge an "engagement" fee of $750 while the EEOC is considering a claim. He charges an additional fee to bring a federal action, which is determined after the EEOC acts. In the case, the attorney left the full amount of the engagement fee blank at the outset and charged a total engagement fee of $5,000, but did not reduce the amount to writing. There was also a contingent fee that was written into the original retainer agreement.
The court concluded that the fee was reasonable and that the attorney had obtained a good result for the client. His effort to keep fees low for those who did not go to court "is certainly not to be discouraged." However, the retainer failed to disclose adequately the method by which the contingent fee would be calculated and thus violated the rule. The court did not find a violation of the business transaction with client rule.
Two justices dissented, "believing that the Commission did not prove a charged violation by clear and convincing evidence and thus that the Hearing Officer correctly found no violation..." (Mike Frisch)