June 2, 2012
Tax Offenses By Tax Attorney
An attorney who had been reprimanded in Massachusetts received reciprocal discipline of a public censure by the New York Appellate Division for the First Judicial Department.
The misconduct had taken place while the attorney was employed by the Internal Revenue Service:
On or about May 18, 2011, the Supreme Judicial Court of the Commonwealth of Massachusetts for Suffolk County issued an order directing its Board of Bar Overseers to issue an order publicly reprimanding respondent based on professional discipline imposed by the United States Department of the Treasury, Office of Professional Discipline (OPR), which suspended respondent on January 20, 2010 for four years from practicing before the Internal Revenue Service (IRS) for willfully failing to file his personal federal tax return for 2002, and filing late returns for 2000 and 2001, and 2003-2005...
Respondent is a practicing tax attorney and partner in the Boston based law firm of Nachmias, Morris & Alt. From 1993 to about 1998 respondent was an attorney with the IRS. In May 2008, OPR commenced a proceeding by filing a complaint against respondent for violating 31 CFR § 10.51(a) by committing the above described offenses. Respondent submitted an answer in which he denied most of the substantive allegations and appeared pro se in an administrative hearing. The Administrative Law Judge did not permit respondent to call any witnesses or introduce exhibits because he did not notify the other party by the designated date of his intention to do so. He was permitted to testify in narrative form, and he submitted a brief.
During the proceeding, respondent claimed that he had filed his federal returns for all of the years at issue, although conceding that some returns were late; all his returns were accurate and all taxes owed were paid; the OPR proceeding was initiated by referral from an IRS agent in a contentious case in which respondent had zealously represented a client; and his late filings were attributable to personal demands involving care for his ailing parents.
The attorney did not appear in the New York reciprocal proceeding. (Mike Frisch)
"Confused, Disingenuous Or Downright Dishonest, And Plainly Incredible"
The New York Appellate Division for the First Judicial Department suspended an attorney for six months for the following misconduct:
This matter arises from respondent's representation of a client in a civil case and a case in the U.S. Bankruptcy Court regarding the administration of real property. In a traverse hearing in the civil action, the Special Referee found that contrary to respondent's sworn assertions that he personally served the defendants in that case in February 1999, he handed the papers to a receptionist and did not personally serve them until June 1999. The Special Referee found respondent's testimony to be "confused, disingenuous or downright dishonest, and plainly incredible." In the bankruptcy proceeding, the court found that respondent "acknowledged that he had no contemporaneous time records to support [his claim for attorney fees and disbursements], that he permitted other time records to be left out in the rain and rendered illegible and that he destroyed any remaining legible time records ... during the pendency of litigation."
In May 2009, the DDC petitioned this Court for an order giving collateral estoppel effect to the two decisions and finding respondent guilty of professional misconduct. By order dated June 14, 2010, this Court granted the DDC's petition. We found that, based on these decisions, respondent engaged in misconduct in violation of DR 1-102(A)(4) (conduct involving dishonesty, fraud, deceit, or misrepresentation) and DR 1-102(A)(5)(conduct prejudicial to the administration of justice). We referred the matter back to the DDC for a hearing and to recommend an appropriate sanction.
Following the hearing, the respondent submitted a letter citing mitigating circumstances including medical problems, depression and financial pressure. The Hearing Panel rejected this evidence because respondent failed to establish a causal link between those factors and his misconduct. The Hearing Panel issued a report finding that respondent "intentionally lied under oath" and "destroyed important evidence," and recommending a six-month suspension.
The court declined to impose the sanction effective at an earlier date. (Mike Frisch)
Suspended In Pennsylvania
The Pennsylvania Supreme Court has imposed a suspension of two years of an attorney admitted in 2005.
The attorney had neglected eight client matters and failed to escrow unearned fee advances. In some of the matters, the attorney deceived clients and courts. The attorney moved her office without advising current clients.
The attorney had experienced health issues and a number of family crises. The Disciplinary Board found that the attorney had not demonstrated a causal connection between these issues and the misconduct.
Three board members favored a suspension of a year and a day.
In an unrelated matter, the court suspended an attorney for three years who had received a $5,000 retainer to hold against future legal services. The attorney deposited the check in a personal account that had a negative balance and proceeded to use the funds as his own. Eventually, the client sued him and obtained a (still unsatisfied) judgment against him. He also made false statements concerning his trust account compliance. (Mike Frisch)
June 1, 2012
Lunch Break Appeal Falls Flat
Another story about an attorney who should have hired counsel rather than doing his divorce pro se comes from the web page of the June 2012 California Bar Journal:
[An attorney] for one year, stayed, placed on two years of probation with an actual six-month suspension and he was ordered to take the MPRE within one year and comply with rule 9.20 of the California Rules of Court. The order took effect Jan.12, 2012.
State Bar Court Judge Richard A. Platel found that [the attorney] committed misconduct in his divorce proceedings and said his testimony during a four-day trial was unbelievable. [He] was declared a vexatious litigant by a superior court judge eight years after the divorce proceedings began, and Platel said that his actions caused his ex-wife to spend an additional $100,000 to defend her side of the action.
Although [he] stipulated to the appointment of a special master in the divorce case, he claimed he had not done so after the special master issued a report that was unfavorable to him. He also filed an appeal from court order that he claimed had been issued before any orders were entered. Platel said [the attorney] thus intentionally made false statements and sought to mislead judges “for the corrupt purpose of avoiding unfavorable rulings and staying the superior court proceeding in order to deprive that court of jurisdiction.”
The special master had found that [the attorney] failed to comply with his ex-wife’s discovery requests. The court ordered [him] to pay sanctions of $41,000, later reducing that amount by $500. He had not produced tax returns for his real estate business or had provided documents that were disorganized and copied over other documents.
During a lunch break in the family law action, [the attorney] appealed all pending orders so that he could then “take the position that the Superior Court had lost jurisdiction to conclude the hearing and that further trial court proceedings should be stayed.” The court continued the hearing anyway.
[The attorney] unsuccessfully appealed the trial court’s rulings. The court of appeal found the appeal frivolous, called his lunch break appeal a “sophomoric stunt” and ordered O’Brien to pay his former wife sanctions of $23,712. The court ordered that its opinion be forwarded to the State Bar for discipline. [He] sought review of the appellate court’s findings with the Supreme Court, which denied his request.
As part of a custody case, the family court also ordered [him] to pay retroactive child support ranging from $1,118 a month to $1,285 a month. [The attorney], however, continued to pay $738 per month and his ex-wife was forced to file motions for contempt. [He] settled with her before any hearings were held.
In the State Bar proceedings, [he] claimed the trial court’s orders did not require him to pay anything, but only set forth amounts owed. He calculated a different, lower figure that he said represented the “just” amount of child support and that he was “finding the truth” regarding his child support obligations. “In sum,” Platel wrote, [the attorney] “argues that he did not have to comply with the court’s child support order, because his version of the circumstances was the ‘truth’ and his method of calculating child support is‘just.’ Such assertions are without rational basis and, thus, are rejected by this court.”
Platel found that [the attorney] failed to obey a court order and made false statements to the court “for corrupt motives.”
“Throughout this disciplinary proceeding,” Platel wrote, [his] “testimony has changed and his version of the ‘truth’ becomes whatever best supports his claim at the moment, irrespective of any facts with which he is confronted.” He said [the attorney] significantly harmed both his ex-wife and the courts by filing frivolous appeals and motions. [He] also “showed absolutely no remorse for his actions, other than perhaps a lack of judgment for filing his ‘lunch break appeal,’”Platel wrote.
Platel found that [the attorney] had no prior discipline record and he cooperated during the State Bar Court proceedings.
Hearing First, Sanction Later
The New York Appellate Division for the Third Judicial Department has rejected the motion for summary disbarment of an attorney who was convicted in New Jersey of aggravated assault in the third degree.
The court held that there is no comparable felony under New York law, which is necessary to impose summary disbarment. However, the offense is a "serious crime" and warranted an interim suspension pending final disciplinary action. (Mike Frisch)
Not Flat But Special
The Iowa Supreme Court has issued a public reprimand of an attorney who attempted to expand his Colorado immigation practice into the Hawkeye state.
The attorney received what he called a flat fee from an immigration client. The court had a different description of the fee -- a special retainer. The attorney failed to treat the fee as entrusted and did not comply with rules governing unearned fees.
The court did make a rather interesting remark about allegations that the attorney violated advertising rules:
We choose not to address the Board's claim that [the attorney] violated our rules pertaining to lawyer advertising because even if we were to find that he did, we would not impose a greater sanction than is required for [his] trust account infractions...
Iowa has always had the most stringent rules on lawyer advertising. Is this comment a signal that the court may be softening its stance? (Mike Frisch)
May 31, 2012
No Non-Pecuniary Damages For Malpractice In New York Criminal Cases
The New York Court of Appeals has held that a plaintiff suing for legal malpractice in a criminal case may not recover non-pecuniary damages.
The court found no "compelling reason" for a contrary result, which would have "negative, and at worst, devastating consequences for the criminal justice system" by discouraging attorneys from undertaking court-appointed criminal defense work. (Mike Frisch)
A report on a case involving a suspension from the Utah Bar Journal:
On January 31, 2012, the Honorable Samuel D. McVey, Fourth Judicial District Court, entered an Order of Discipline: Suspension suspending Allen F. Thomason from the practice of law for a period of one year for violation of Rules 3.3(a) and (d) (Candor Toward the Tribunal), 4.4(a) (Respect for Rights of Third Persons), 8.4(b), (c), (d), and (e) (Misconduct), and 8.4(a) (Misconduct) of the Rules of Professional Conduct.
The Complainant and his wife, had been having domestic problems and were seeking a divorce. Mr. Thomason befriended the wife and attempted to assist her with a DUI. Mr. Thomason went to the marital home on one occasion and had words with the husband. After a domestic dispute in which police were called and the wife was told to leave the home, Mr. Thomason went to the marital home on behalf of the wife and removed the locks from the doors. The husband went to the home to see if his wife was gone and saw the locks had been removed. He went into the home and encountered Mr. Thomason. After the two had words again, the husband left the home and called the police. The husband then asked his mother if she would go to the marital home and retrieve his camcorder and camera. When the mother went to the marital home to pick up the camera, Mr. Thomason confronted her and blocked her from leaving the room. Mr. Thomason told her that he was a judge and she was under arrest. After several minutes, the mother put down the camcorder and was allowed to leave the room. When the officers arrived Mr. Thomason refused to wait near the curb as instructed by the police. Mr. Thomason declared several times that the responding police officers were "under arrest." Mr. Thomason made threats against the officers, claiming that he was a judge, and held more arrest authority than the officers. Mr. Thomason was cited for "Interfering w/Legal Arrest", a violation of Utah Code Section 76-8-305, for his interference with the officers' investigation. The Provo City Justice Court held a trial where Mr. Thomason was found guilty of interfering with a legal arrest. Mr. Thomason appealed the conviction and later entered into a Diversion. After the incident at the marital home, Mr. Thomason filed an Ex Parte Stalking Injunction against the husband, claiming that he had been assaulted when the evidence did not support this. The Ex Parte Stalking Injunction obtained by Mr. Thomason caused harm to the husband. Mr. Thomason exhibited a lack of candor in his filings with the court. Mr. Thomason attempted to delay the stalking injunction hearing so that the husband would not be able to participate in hunting season. Mr. Thomason also sent several e-mails to the husband's divorce attorney that contained numerous misrepresentations. Mr. Thomason threatened to file Judicial Conduct complaints against the police officers when he had no grounds to do so. Mr. Thomason threatened to file civil suits against the Complainants unless they dropped their Bar complaint. Mr. Thomason made unfounded accusations of unethical conduct against the husband's attorney.
May 30, 2012
Best To Say You Are Sorry
The Illinois Review Board has proposed a suspension of 30 days of an attorney who failed to disclose her financial interest in real estate settlements:
The relevant facts are not in dispute. [the attorney] was admitted to practice law in Illinois in 2001. In 2005, she and attorney Dortricia Penn opened the Law Offices of Penn & Scott. Respondent concentrated her practice on civil matters, including residential real estate transactions. Both Respondent and Penn were title agents for Ticor Title.
Prior to April 2008, when counsel for the Administrator inquired about her compliance with the Title Insurance Act, 215 ILCS 155/18, Respondent was not aware that, when acting as both attorney and title agent, the Title Insurance Act required her to disclose to her clients in writing that she had a financial interest in their real estate transactions and to obtain her clients' written consent. Respondent admitted that she did not provide written disclosures or obtain written consent in six transactions when she acted as attorney and title agent. Her clients in those transactions were Karen Van, Farrah Bledsoe-Whitlow, Cousandra Armstrong, Percy Wicks, Nathaniel Maxwell, and Talisa Jackson. Respondent received a total of $6,981 in title fees from the six transactions.
As to sanction:
We have considered in mitigation that Respondent has no prior discipline and that her misconduct did not result from an improper motive but from a lack of awareness of her professional responsibilities. That said, we consider in aggravation Respondent's failure to recognize that her conduct was improper. The Hearing Board found that Respondent did not seem to understand the rules pertaining to conflicts of interest or the reasons for those rules. She maintained that there was nothing wrong with her conduct. Respondent's failure to recognize obvious conflicts of interest is cause for concern and convinces us that a suspension is necessary to protect the public and ensure that Respondent is aware of and understands her ethical responsibilities to her clients.
DOJ Sanction Leads To Virginia Suspension
The Virginia State Bar Disciplinary Board has accepted an agreed disposition and imposed a 3 1/2 year suspension of an attorney-advisor with the federal Bureau of Prisons. He was advanced to the position of Senior Litigation Counsel in 2006.
The attorney was admitted in Virginia in 1988 and is not licensed in any other jurisdiction. He was suspended for failure to pay bar dues on five separate occasions for a total of 128 months.
The suspension issue came to light in 2008 and was reported to the Department of Justice's Office of Professional Responsibility ("OPR"). The attorney admitted that he made a series of six false statements to OPR in a March 2007 interview.
OPR concluded that the attorney violated his obligation to maintain an active law license as a condition of employment. OPR further found he violated his duty of candor. DOJ thereafter suspended him for two 25-day increments --a total of 50 days.
This misconduct drew a more severe internal DOJ sanction than the misconduct in the Ted Stevens prosecution, which takes over 600 pages for OPR to describe.
Does that say anything about the nature of internal regulation? Clearly, the Virginia bar authorities took the matter far more seriously than did OPR. (Mike Frisch)
Ex-Spouse Not Domestic Partner
The panel report addresses possible campaign violations by a judicial candidate.
One count alleges that the candidate's former spouse loaned her campaign $25,000. A second count contends that the judge used her bailiff to solicit campaign contributions. A third count involves her campaign materials.
The panel report deals with the interpretation of the phrase "domestic partner." Domestic partners may make loans to campaigns for judicial office. The panel found that the judge and her ex-husband have a "close friendship" but do not live together or have a sexual relationship. Thus
...the definitions of domestic partners and the common understanding of the term can be summarized as two unmarried individuals who live together in a romantic, marital type relationship and who either choose to, or unable to, be legally married.
The panel rejected the charges involving the bailiff and requested that the matter be expedited "as the campaign is ongoing." (Mike Frisch)
May 29, 2012
Limited Practice Violation Results In Revocation
The Michigan Attorney Discipline Board has affirmed a hearing panel's revocation of the license of a special legal consultant.
Under Michigan's rules regulating practice, a "special legel consultant" may engage in limited practice on matters of a foreign jurisdiction where the consultant is licensed. The attorney here was permitted to offer professional advice on matters involving interpretation of Nigerian law.
He entered his appearance as counsel in a civil matter involving allegations of negligence and breach of contract. The matter did not involve issues of Nigerian law.
The board noted that he also had a website that advertised his availability in a number of areas of domestic law. (MIke Frisch)
The Death Of Jerry Berry
The Idaho Supreme Court has affirmed the grant of a new trial to an attorney and his girlfriend who were found by special jury verdict to have breached fiduciary duties to a former client by purchasing half of his stock in a closely-held corporation for less than fair market value.
The stock was for a resort property on the shore of Lake Pend Orielle and was held in equal shares by two couples. The stock of one couple was purchased by a man with the wonderful name of Jerry Berry.
The attorney, who practiced bankruptcy law, visited the resort and made Mr. Berry's acquaintance. Berry consulted him about a possible bankruptcy but did not pursue that option. Later, Berry wished to purchase the other 50% of the stock, with money lent by the attorney in part and his girlfriend in part. The attorney thought he would be repaid on sale of the resort, but the sale did not happen.
Berry was diagnosed with pancreatic cancer, triggering events that led Berry to transfer the stock to the attorney and girlfriend to repay the obligation and the attorney to take control of the corporation. Berry died in November 2006.
The attorney then had the locks to the resort changed and did not give a key to Mrs. Berry. He approached her the day after the memorial service with a proposed special resolution and shortly thereafter was elected corporation president by 2-1 majority vote of himself and the girlfriend, who was elected treasurer by the same margin.
As they say, litigation followed, initiated by Berry's widow.
The court here found that the trial court's instructions on the attorney-client relationship were "clearly inadequate." The district court "did not err in holding that there was insufficient evidence to sustain the verdict that when [the attorney] purchased the stock he breached his fiduciary duty to Mr. Berry arising from an attorney-client relationship."
The court noted a dearth of evidence of an attorney-client relationship between Berry and the attorney after the 2000- 2001 consultation. The stock purchase took place in 2006.
The court and a concurring opinion were unimpressed by the attorney's "shabby" treatment of Mrs. Berry, which may have contributed to the jury's verdict.
Justice Jones, concurring, opines that while plaintiff's case raised "some smoke, it did not produce the actual fire necessary to support the verdict" against the attorney and the girlfriend. (Mike Frisch)
Life After Nifong
The North Carolina State Bar has filed a complaint alleging ethics violations by the former Durham County District Attorney.
The complaint charges that the DA directed an investigator to make misleading statements to prison authorities in order to obtain visitation records of three inmates and engaged in ex parte contacts with a judge to obtain the records. The complaint alleges that the DA sought confidential information that she was not entitled to.
The complaint further alleges that the DA filed a complaint against a judge and "made repeated statements about the honesty, integrity and fairness of [the judge]." The complaint contends that the DA falsely or recklessly called the judge corrupt.
ABCNews had this report.
This isn't the first time the Durham district attorney's office has been embroiled in controversy in recent years. Cline replaced Mike Nifong, who resigned in disgrace after prosecuting three Duke University lacrosse players falsely accused of rape. Nifong was later disbarred.
Governor Beverly Perdue named a retired Superior Court Judge A. Leon Stanback, Jr. as the interim Durham DA earlier this year.
Cline has appealed her removal and she continues her fight to gain access to emails belonging to Judge Hudson. There cannot be a special election to replace her until she has exhausted her appeals.
"A Very Special Circumstance"
In a series of disciplinary matters involving an attorney who "was struggling with substance abuse," the Georgia Supreme Court was sharply critical of the "piecemeal adjudication of [the two] disciplinary matters [that] not only wastes this Court's resources at a time when those resources are already significantly strained, but also may result in the imposition of disciplinary penalties that ill fit the totality of an attorney's misconduct, and should be avoided in the future."
The court noted that the special master found that the attorney "is in a prolonged recovery from the illness of alcohol and substance abuse which led to his wrongful conduct" and accepted the recommendation for a public reprimand with terms.
The court noted that the attorney's recovery and restitution to harmed clients was a "very special circumstance" and ordered that the attorney participate the the State Bar's lawyer assistance program.
The court had previously rejected a petition for voluntary discipline. (Mike Frisch)
Traveling Client Issue Leads To Reprimand
The Georgia Supreme Court has imposed a review panel reprimand of an attorney who represented a client who "[b]ecause his profession required extensive travel, [the attorney] had some difficulty reaching the client to review and sign documents connected to the case."
As a result of the difficulty, the attorney twice signed the client's name to documents. The documents he signed "were identical in substance to those actually signed by the client..."
The relatively lenient sanction notes that the special master found that the attorney had no prior disciplinary history and made efforts to correct his misrepresentation before the original signed documents were filed. (Mike Frisch)
May 28, 2012
Monopoly On Sanction
The District Attorney for Albany County has been censured by the New York Appellate Division for the Fourth Judicial Department for comments about a judge made in an electronic mail message to a news reporter.
The DA was prosecuting alleged illegal sales of prescription drugs by individuals operating out of a Florida pharmacy. After the judge dismissed charges and disqualified the DA's office, the offending e-mail described the judge's action as a "get out of jail free" card and called the judge's decision a "dangerous loophole."
The court held that the first statement was objectively false and the second reckless and misleading, amounting to conduct prejudicial to the administration of justice.