Friday, June 29, 2012
The Wisconsin Supreme Court has imposed a public reprimand of an attorney admitted in 1960 in a matter that arose from the "contentious dissolution" of a law firm.
The attorney was found in violation of the rule prohibiting covenants not to compete and misleading the public.
The issues involved a named partner named Eisenberg. The reprimanded attorney caused the firm's offices to move without notice to Mr. Eisenberg, who was then told that there was "no office space for him, that he should go home, and that his paychecks would be sent to him."
But the Eisenberg name lived on at the firm:
After the move to the new office and until March 2005, the firm continued to display in the client waiting area a framed photo of former Green Bay Packer football player Reggie White which contained the handwritten statement:
Happy birthday Mr. Alvin Eisenberg. Thank you for your caring heart. You are a Humble man. May our Lord Jesus the Son of Jehovah God Bless You. Reggie White # 92[.] 1 Cor. 13.
On March 3, 2005, the firm, still using the Eisenberg name, entered into an agreement with a lawyer named Donald S. Eisenberg. At the time, Donald Eisenberg was engaged in an "of counsel" relationship with a Madison law firm and was not affiliated with the firm in any way. Donald Eisenberg was never a shareholder or an employee of the firm. Pursuant to the agreement, Donald Eisenberg was paid a flat sum of $1,500 per month, with no FICA deductions or tax withholdings from the payments, as long as he maintained a license to practice law, whether or not he did anything for the firm. He spent little time in the firm's office.
The firm then affixed a name plate stating "Mr. Eisenberg" on an office door at the new office.
The court majority rejected a charge that the attorney's bonus arrangement with firm paralegals violated the fee-splitting with a nonlawyer probition:
To determine whether this bonus system runs afoul of SCR 20:5.4 we consider the original intent of rule, which is to protect a lawyer's exercise of independent professional judgment. Arguably, a paralegal always has some interest in maximizing the lawyer's fee income because the paralegal indirectly receives compensation generated from attorney's fees which are, themselves, generated by recoveries by clients. In that respect, however, the paralegal is no different than every nonlawyer employee of every law firm whose income is principally derived from contingent fee recoveries.
We do not have specifics about the number of cases this paralegal works on, but the record indicates this is a high volume legal practice. Based on the evidence presented we find no indication that the paralegal would be interfering with the lawyer's independent judgment. We emphasize that the law firm has a general duty, and the paralegal's lawyer-supervisor has a specific duty, to ensure that the paralegal's conduct is compatible with the ethical obligations of lawyers. However, we conclude that the rule, as drafted, does not preclude the bonus structure described in this case. Accordingly, we dismiss the third count of the complaint related to the bonus structure used to compensate certain paralegals.
Two justices dissented and would uphold the fee-splitting charge. (Mike Frisch)