Thursday, October 9, 2014
Disbarment is the appropriate sanction for an attorney who "skimmed" over $14,000 in funds due to his law firm, according to a decision of the Michigan Attorney Discipline Board.
The board modified a 2-1 hearing panel report that had imposed a two-year suspension.
The attorney had produced a substantial amount of character evidence consisting of nine witnesses and approximately 50 letters of support. He had been president of the Muskegon County Bar Association and had "capably represented thousands of clients over the years."
The board was unmoved by his self-comparison to Jean Valjean
respondent was not stealing bread for his family; he was, as he admits, living beyond his means...
This is not the first case in which a "good lawyer," who is active in professional and community affairs, has made the decision to convert funds entrusted to him or her, and, after discovery, began to examine his or her decisions...
When a competent lawyer who is well-known and perhaps even well-liked, and who may lead an otherwise respectable life, makes the decision to steal when it looks like he can get away with it, this may prove that people are complicated and that some have the ability to compartmentalize. It does not constitute compelling mitigation.
The mitigation was "artfully assembled" but not sufficient to avoid disbarment. (Mike Frisch)
A Tennessee attorney has been suspended as a result of his guilty plea to statutory rape charges.
WATE.com reported in August 2013 on the charges
A Harriman attorney is charged with three counts of statutory rape, and one count each of solicitation of a minor and especially aggravated sexual exploitation of a minor following his arrest Wednesday.
A Lenoir City woman also faces a charge of especially aggravated sexual exploitation of a minor in connection with the case.
Kent Booher, 58, was arrested at his home in Harriman after indictments were issued by a Loudon County grand jury.
Booher is being held in the Loudon County Jail on a $29,000 bond.
Malina Nanette Akin, 36, is being held in the Loudon County Jail on a $10,000 bond. She is also accused of violating parole.
The indictment accuses Booher and Akin of using a minor to participate in the production of material that includes sexual activity or simulated sexual activity.
Booher is charged with three counts involving the alleged rape of a girl under the age of 16. He is also accused of using electronic communication to solicit the engagement of sex with the teen.
According to the Tennessee Bar Association, Booher's practice includes criminal and juvenile law.
He received a public censure last year by the Board of Professional Responsibility of the Supreme Court of Tennessee after being accused of failing to properly represent a client. The board said Booher "failed to act with reasonable diligence in an estate matter, failed to maintain reasonable communication with his client, and failed to expedite litigation.
The Knoxville News Sentinel reported the conviction and jury deadlock in the case against Ms. Akin
According to court records, Booher repeatedly paid to have sex with the girl between December 2012 and May 2013. He videotaped the liaisons and also ordered the girl to send him nude photographs.
The suspension is interim pending final discipline. (Mike Frisch)
A two-year suspension was imposed by the New York Appellate Division for the Second Judicial Department for misconduct described by the court
respondent admittedly failed to cooperate with the Grievance Committee in eight separate matters, neglected two legal matters entrusted to him, handled a matter which he knew, or should have known, he was not competent to handle, without associating with a lawyer who was competent to handle it, failed to turn over a client's file to new counsel, as requested, failed to comply with a memorandum and order of the United States District Court for the Eastern District of New York, and failed to comply with an information subpoena. Previously, the respondent was issued four letters of admonition and two letters of caution for similar misconduct. Although the Special Referee found the respondent to be credible, and attributed the respondent's misconduct to, inter alia, his diagnosed depression, the record amply reflects that the respondent's admitted misconduct was, by and large, the byproduct of entrenched patterns of conduct— avoidance and self-defeating behavior— rather than depression. In fact, the respondent's own expert conceded that the respondent's depression would not be the type to result in the misconduct charged. According to the respondent's expert, the respondent is "brighter than most," with "good insight into his behavior" and "[awareness] of the wrongfulness of his conduct." He "just [cannot] kick-start himself into gear."
The court declined to grant credit for time served on a previously-ordered interim suspension. (Mike Frisch)
The District of Columbia Court of Appeals has accepted the consent of Adrian Cronauer and entered an order of disbarment.
As we previously noted, his experience as a disc jockey were the basis for the movie Good Morining Vietnam. (Mike Frisch)
A real-estate deal got an attorney suspended for one year by the New York Appellate Division for the Second Judicial Department.
The same transaction led to the public censure of the attorney's daughter by the same court.
As to the mother
After studying a real estate investment course, the respondent, an experienced attorney-at-law, entered into a business partnership with a nonlawyer, Mark Vandeventer (hereinafter Vandeventer), aimed at investing in distressed properties. While searching for a suitable investment, the respondent learned of a potential property, which was owned by her friends, Mr. and Mrs. Raleigh Trent (hereinafter the Trents), residents of Virginia. The subject property was the Trents' former residence, located at 32 Grove Street, Riverhead, New York (hereinafter the Riverhead property). The respondent had known the Trents almost all of her life, as they previously resided in the same Riverhead community, she attended school with the Trents' children, the respondent's mother worked with the Trents, and they worshiped at the same church. In contrast, Vandeventer was a relatively new acquaintance, whom the respondent met sometime in 2005.
In or about January 2006, the respondent and Vandeventer entered into negotiations with Mr. Trent to purchase the Riverhead property. At that time, the Riverhead property was not encumbered by any mortgage, but there were approximately $20,000 in tax arrears. No appraisal was conducted to determine the fair market value of the Riverhead property. Moreover, the Trents were not represented by counsel when the terms of the transaction were negotiated. The respondent acknowledges that Mr. Trent had limited experience in legal matters. Ultimately, the terms of the sale provided for a total purchase price of $82,500, consisting of a $5,000 down payment and a $77,500 seller-financed loan, evidenced by an unsecured promissory note. The purchasers were also required to pay the delinquent real estate taxes.
After the terms of the sale were negotiated, the Trents retained the respondent's daughter, Annette Marie Totten (hereinafter Ms. Totten), to represent them in the sale. Although Ms. Totten was the sellers' attorney, she did not draft the contract of sale (hereinafter the contract), which was forwarded to her by the purchasers. Ms. Totten neither proposed, nor made, any changes to the contract before forwarding it to her clients in Virginia. The Trents executed the contract as it was presented to them, without modification.
The Trents did not attend the closing. Rather, they authorized Ms. Totten to act as their attorney-in-fact, pursuant to power of attorney forms, which they executed. At the closing on February 14, 2006, the respondent and Vandeventer executed the aforementioned promissory note in favor of the Trents, evidencing the seller-financed purchase money loan of $77,500. Ms. Totten thereupon executed a deed conveying the Trents' Riverhead property to the respondent and Vandeventer. In accordance with the contract, no mortgage or other instrument securing repayment of the foregoing promissory note was executed, delivered, or recorded.
Within three months, on May 10, 2006, the respondent ended her business partnership with Vandeventer, deeded her interest in the Riverhead property to him, and received a personal check from him in the sum of $40,000. That same day, Vandeventer secured a loan in the amount of $156,000 from Wells Fargo Bank, NA, and a mortgage was given and recorded against the Riverhead property. The promissory note in favor of the Trents was not satisfied at that time.
On or about February 28, 2007, Vandeventer obtained a further loan in the amount of $260,000 from Fremont Investment and Loan, which was secured by another mortgage on the Riverhead property. At that time, the Wells Fargo loan was satisfied. However, the promissory note in favor of the Trents was not.
On or about October 31, 2008, Vandeventer filed for bankruptcy, listing the unsecured promissory note to the Trents as an obligation. Vandeventer's unsecured debt to the Trents was discharged in bankruptcy.
Notwithstanding the transfer of her interest in the Riverhead property to Vandeventer, the respondent admittedly remained responsible for the debt to the Trents. However, she has never honored her obligation under the unsecured promissory note, and the Trents have never received the consideration for their Riverhead property contemplated by the unsecured promissory note.
As to the violations
We find that the respondent's relationship with her longstanding friends, the Trents, created the essential element of trust necessary to consummate the sale. Indeed, the respondent, an experienced attorney, negotiated the terms of the sale with Mr. Trent, an individual with limited experience in legal matters, prior to his retention of legal counsel. In doing so, the respondent deceptively secured disproportionately favorable terms that enabled her to purchase the Riverhead property without any financial contribution, and without disclosing to Mr. Trent the significant risk of loss if the seller-financed loan went unpaid. Moreover, shortly after obtaining title to the Riverhead property, the respondent knowingly released her interest in that property, in exchange for $40,000, without ever satisfying the promissory note to the Trents. Despite having made no financial contribution towards this transaction, the respondent personally profited. Further, her actions enabled Vandeventer to secure multiple loans on the Riverhead property, and directly contributed to the substantial financial loss sustained by the Trents.
Attorneys are held to a higher standard than nonattorneys in connection with their personal dealings. " While a lawyer may engage in business, if he [or she] wishes to remain a member of the Bar he [or she] must conduct himself [or herself] in that business in accordance with the standards imposed on members of the Bar'" (Matter of Ushkow, 34 AD2d 159, 161, quoting Matter of Kaufman, 29 AD2d 298, 299). Indeed, an attorney's actions should not "be measured by the standards of the marketplace alone. His [or her] conduct, while in some instances not involving an attorney-client relationship, [reflects] on the reputation of the Bar" (Matter of Madera, 39 AD2d 202, 205).
We find that the respondent knowingly engaged in conduct involving dishonesty, deceit, fraud, or misrepresentation, by her participation in the business investment in the Trents' Riverhead property, which conduct adversely reflects on her fitness as a lawyer.
The daughter's story
We find that, when the respondent represented the Trents in the foregoing transaction, her professional experience was principally in criminal law, and she had limited experience in real estate transactions. Notwithstanding the respondent's knowledge of the Trents' limited reading proficiency, she did not insure that they understood what was at stake in the absence of security for the seller-financed loan. The Special Referee found, and we agree, that "the terms of sale were . . . seriously skewed" against the Trents, and that the respondent never explained the inherent risks of the transaction to them. Although the respondent's testimony indicates that she may not have fully understood the seller financing clause, the unusual and unfamiliar terms of this transaction should have signaled a need for the respondent to consult an attorney with greater experience in real estate transactions. The respondent's failure to appreciate the inherent risk in an unsecured, seller-financed transaction, or to seek assistance from a more experienced attorney, put her clients at risk for the substantial financial loss that ultimately occurred. Consequently, we find, based upon a preponderance of the evidence, that the respondent failed to provide competent legal representation to her clients, which conduct adversely reflects on her fitness as a lawyer.
In light of the respondent's familial relationship with Brown, one of the copurchasers of the Riverhead property, we further find that the respondent had a conflict of interest with respect to her representation of the Trents. Although the Trents may have known that the respondent was related to Brown, the respondent failed to establish: (1) that a disinterested lawyer would reasonably believe the conflict would not adversely affect the respondent's representation, and/or (2) that the Trents received full disclosure of the implications of the respondent's conflicting personal interests.
Wednesday, October 8, 2014
The California State Bar Review Department has proposed a suspension of sixty days and with reinstatement conditioned on restitution to the injured clients of an experienced attorney with no prior discipline.
[The attorney] practiced law for over 30 years without discipline until he agreed to accept contingency fee cases from a company specializing in lender liability lawsuits, which he later learned was disreputable. His relationship with the company ended within a year and before the involvement of the authorities. Following contact from the Office of the Chief Trial Counsel of the State Bar (OCTC), [he] fully cooperated in the investigation and stipulated to his culpability to resolve the matter before disciplinary charges were filed. In particular, he stipulated to: (1) splitting fees with a non-lawyer entity; (2) failing to perform legal services with competence; (3) failing to refund unearned fees totaling $15,740; and (4) failing to provide the State Bar of California with notice that he employed a resigned attorney. The hearing judge recommended a 60-day actual suspension due to [his] extreme remorse, years of practice without discipline, and attempts to make amends.
The OCTC had sought a six-month suspension. (Mike Frisch)
The Minnesota Supreme Court has reversed and vacated an admonition issued by the Director of its Office of Lawyers Professional Responsibility.
The attorney had allegedly engaged in conduct prejudicial to the administration of justice as he had failed to appear at a series of court hearings in a divorce case and "because he did not inform the district court that he had a limited-scope agreement with his client that excluded court hearings."
The attorney and client reached a fee agreement to prepare paperwork and handle a single uncontested hearing. The agreement was for an hourly fee if there was further work to be done.
The district court granted the divorce but reserved decision on support and custody. The court entered a divorce decree that effectively concluded the attorney's representation.
Further hearings followed without the attorney being present. When the judge advised the parties that an amended divorce decree was necessary, the client again consulted the attorney. After "implictly returning to attorney of record status" at that juncture, the attorney missed a single court hearing.
The judge filed the bar complaint.
The court here reversed a panel decision finding that the attorney's non-appearence was prejudicial to the administration of justice.
At most, the record establishes that A.B. failed to attend only a single hearing: the one that occurred on June 20. As to each of the other hearings, the district court rescheduled them, or A.B. was not required to appear because he was no longer counsel of record. Because there were not "four consecutive hearings" at which A.B. failed to appear, we conclude that the panel’s determination that A.B. violated Minn. R. Prof. Conduct 8.4(d) rested on a clearly erroneous factual finding...
Based on the unique facts of this case, we further conclude that the panel erred when it determined that A.B.’s failure to attend the June 20 hearing violated Minn. R. Prof. Conduct 8.4(d). A.L. instructed A.B. not to attend the hearing pursuant to the terms of a limited-scope legal representation, the propriety of which the Director does not challenge. A.B. reasonably believed that A.L. would attend the hearing, at which point she could inform the court that she had instructed A.B. not to attend. Under these circumstances, we vacate the admonition because A.B.’s conduct was neither prejudicial to the administration of justice nor warranted discipline.
An important aspect of the opinion is its acknowledgement of the efficacy of the limited scope agreement. That is not often seen in the disciplinary context. (Mike Frisch)
The Illinois Administrator has filed a complaint alleging that an attorney stole funds from a trust created by his parents for the benefit of his children.
After the complaint describes the establishment and funding of the trust, it is alleged that
Respondent used the entire proceeds of check numbers 1358487 and 1358485 for his own personal purposes, largely for personal travel and casino gambling.
The amounts allegedly stolen totalled over $230,000..
The attorney for the mother and children (named John F. Kennedy) made inquiries about the funds, to which the attorney allegedly made false responses. (Mike Frisch)
Tuesday, October 7, 2014
An attorney who engaged in business transactions with three financially-unsophisticated client couples has had his license revoked by the Wisconsin Supreme Court.
Attorney Trewin usually loaned the couples money, often at relatively high interest rates (12-14%), starting with fairly small amounts and increasing the amount of the loans over time as the couples needed additional funds. The referee further found that because Attorney Trewin was not constrained by standard banking regulations, the clients did not receive many of the pieces of information and the warnings that they would have received when borrowing from traditional lenders. Moreover, there were many errors in the documentation of the loans and the tracking of payments.
In some instances, either there were no signed promissory notes and conflict waivers, or Attorney Trewin lost those documents since he was unable to produce them during this disciplinary proceeding. In at least one other instance, the date on the conflict waiver was months apart from the date of the purportedly corresponding promissory note. Also, when Attorney Trewin was able to produce a signed document purporting to be a conflict waiver, the description of the transaction in the conflict waiver was, at times, not even consistent with the loan terms set forth in the promissory note. Further, the referee specifically found that the conflict waivers did not disclose all of the true facts regarding the transactions, did not provide any meaningful explanation of the disadvantages of entering into these transactions with the clients' lawyer, and did not include a discussion of the alternatives available to the clients.
Attorney Trewin's haphazard manner of handling these transactions left the clients confused about which loans were outstanding, what payments they had made toward which loans, and the balances of their loans...
Ultimately, when the couples had difficulties making their payments to Attorney Trewin or to another creditor, he would persuade the couple to transfer their property over to him, with the promise that he would lease the property back to them and they could reacquire the property if they were current on their payments to him and could also pay a specified amount to him for their property. The couples, however, were not in a financial condition where they could ever regain ownership of their property. Nonetheless, because of Attorney Trewin's actions, some couples continued to hold the mistaken belief that they really did retain ownership or control of the property even after they had transferred ownership of it to Attorney Trewin. In the end, Attorney Trewin ended up with the title to the clients' real property.
The court on sanction
We conclude that the revocation of Attorney Trewin's license to practice law in this state is appropriate and required. Attorney Trewin was already put on notice of the perils of engaging in transactions with clients in the Trewin I disciplinary proceeding. He nonetheless continued to engage in such transactions without meeting the very strict requirements that protect clients from overreaching by more sophisticated attorneys. Moreover, he used the knowledge he had gained from handling the clients' legal matters to structure those transactions in a manner that ensured he would benefit and the clients would not. Those transactions ultimately resulted in Attorney Trewin acquiring the clients' property and enriching himself at their expense. It is clear that the public needs to be protected from this type of conduct and that, as the referee commented, Attorney Trewin is unfit to engage in the practice of law in this state.
An attorney who engaged in multiple acts of serious misconduct over a protracted period of time should be disbarred, according to a recent report and recommendation of the California State Bar Court Review Department.
The attorney had a busy personal injury practice that kept him in court on a regular basis. He shared an office manager (Wheeles) with a law school classmate and friend. His trust in the office manager was misplaced.
When her issues came to his attention, he failed to act.
...the misappropriation was the result of gross negligence amounting to recklessness, considering Guzman’s failure to monitor his CTA or his office staff. Yet, at trial, Guzman sought to blame Wheeles rather than accept responsibility for the misappropriation. In addition, we weigh heavily his overreaching in having his clients sign a fee agreement that ceded to him the unfettered right to control their cases, and after abandoning or settling their cases without their knowledge or consent, disappearing from view. Not surprisingly, this repeated course of conduct resulted in significant harm to multiple clients.
The attorney's retainer form
The Client hereby specifically authorizes The Attorney to settle his/her claims without instituting litigation, to receive the settlement proceeds; and to take a percentage of the recover in payment of his/hers fees. Client further authorizes The Attorney to endorse The Client’s name on checks paid in settlement claims, to have the proceeds placed in The Attorney’s Client Trust Account, and for The Attorney to with draw attorney’s fees from the account. (Errors in original.)
The hearing judge had proposed a one-year suspension. (Mike Frisch)
Pennsylvania appears to be one jurisdiction that pays more than lip service to public awareness and protection in bar discipline matters.
From the web page of the Disciplinary Board
Historically, the publication of news of the disbarment or suspension of attorneys has been low-key. Notices were issued to newspapers in the area where the lawyer practiced, for publication in the little-read legal notices section of the classified ads. Public discipline is also posted on the Board’s website. The Disciplinary Board believes that communities should know when discipline is imposed on one of their bar, so that practice is changing. The Disciplinary Board has begun issuing press releases of disbarment and suspension cases to media outlets in the market where the disciplined lawyer practices.
“As members of the Disciplinary Board, our duty is to assist the Supreme Court in protecting the public, preserving the integrity of the legal profession and safeguarding the reputation of our courts and the legal system,” said R. Burke McLemore, Jr., Chair of the Disciplinary Board. “By raising awareness of attorney discipline, we highlight our commitment to achieving these goals by demonstrating to the public how the profession is policing itself.”
The decision to focus additional efforts on raising public awareness of such actions arose in part from an incident earlier this year when a Dauphin County lawyer failed to notify his clients that he was forced to surrender his law license.
This is how a responsible disciplinary system approaches its work. For a contrasting approach, see the post directly below.
Let the sunshine in. (Mike Frisch)
On the District of Columbia Bar web page, there is a link to a statement of mission and purpose of the Office of Bar Counsel
the Office of Bar Counsel has a dual function: to protect the public and the courts from unethical conduct by members of the D.C. Bar and to protect members of the D.C. Bar from unfounded complaints.
On all letters written on Bar Counsel stationary this language appears at the bottom
Serving the District of Columbia Court of Appeals and its Board on Professional Responsibility
I'm reasonably confident that no such mission statement was on the web page or anywhere else during my tenure at Bar Counsel from 1984 (which of course was well pre-web) to 2001.
Perhaps what is wrong with Bar Counsel at present is its failure to realize that its only job is to get rid of bad lawyers; protecting reputations plays absolutely no role in that function.
While Bar Counsel must honor the confidentiality of information relating to non-public matters, it has no duty in "protecting the reputation of lawyers..." Rather, the public expression of that as a stated mission ought to confirm the public's worst fears about self-regulation.
And if the current occupants of the Bar Counsel think that their job is to "serve the Board on Professional Responsibility," they need to be replaced with people who understand that their obligations are to the public and not to the parochial, self-interested Bar which the BPR personifies.
If someone ever does a serious study of how long it takes to discipline D.C. lawyers, the result will reveal the extent to which protecting the public from unfit members of the bar remains the real priority. I promise you it won't be a pretty picture.
In Wisconsin, the court recently called in outside consultants to look at their disciplinary process. The reported results raise serious issues about the Wisconsin system. The time is long overdue for a similar critical look at the defects in the present D.C. system.
And the title to this post is an overstatement. There are plenty of other reasons that D.C. bar discipline is an empty promise at best and a cruel joke at worst. (Mike Frisch)
Monday, October 6, 2014
I (Alan) wrote a detailed post here years ago (here) on how permanent disbarment--as opposed to disbarment that allows someone to reapply upon a showing of moral fitness and rehabilitation--would inevitably become the go-to punishment of first reaction. Now it has, in a case reported by Mike this morning here. A man convicted, for this appeal, only of possession of drug paraphernalia (a misdemeanor that I doubt even constitutes a crime of "moral turpitude") whose crime does not even fit the guidelines for permanent disbarment now is told don't even bother trying to enter rehabilitation or changing your life: there's no hope for you.
I don't think readmission after disbarment should be often given. This might be such a case where it wouldn't be and should not be (I am not ignoring his previous disbarment and actions). But these Justices are saying they don't even want the application, ever, and they can't trust themselves to say No. Really, is it so hard to say No to an unworthy application three years from now, ten years from now? Must we say No forever no matter what? To a man whose current appeal of discipline has one conviction only of a misdemeanor? Then won't every case that should be disbarment be given permanent disbarment? Aren't there lawyers given suspension more of a threat to the public in the practice of law than this guy? His crime for this discipline is not even in the representation of a client!
It seemed back then, when I first screeded, to be a PR stunt and an abdication of judicial responsibility. I still think so. I have no particular focus on this one person whom I would understand that they would not readmit after disbarment a second time, but if we keep this up we create no incentive for improvement, no mercy for changing in five years, no responsibility to weed the unworthy cases from the worthy, no use of previously published guidelines, and no place to go with punishment because anything worth disbarring may as well be permanently so -- to show you're tough on ... those who fully cooperated with the police when they were pulled over and later were convicted of a possession charge??
When I wrote before, the crimes and actions being given permanent disbarment usually involved misuse of trust funds, improper acts in the role of a lawyer, crimes that put people away longer than a year, that sort of thing. But I also noted that more and more it was applied to people whose personal lives were a mess -- that if we could fix the person problem the bar problem would easily be fixed too. I think the current case bore out that prediction. While we have bar-sponsored drug programs built on the idea of rehabilitation and changing lives, we have a court unable to imagine any such thing working to the satisfaction of their future selves.
John Dean changed his life. I'd be proud to have had the new Dean in my bar. [Alan Childress]
A petition for voluntary discipline of a two-year suspension has been rejected by the Georgia Supreme Court.
The attorney was convicted of drug and firearms offense. The background
In his petition, Csehy states that he was personally affected by the 2005 Brian Nichols courtroom shooting and, as a result, turned to alcohol and drugs. He went through rehabilitation in 2009, but in 2011 he was brutally attacked by a former client and suffered severe injuries, after which his addictions reasserted themselves. Csehy always had carried at least one firearm on his person or in his vehicle. In 2012 he made arrangements to bring illegal drugs to a woman he believed he knew, but it was part of a sting operation and Csehy was arrested and charged with several drug and firearm violations.
Although he sought treatment
...recent events that have occurred since the filing of Csehy’s petition indicate that he is apparently still representing clients and that his rehabilitation might not have been successful. This Court has received a report indicating that, on September 15, 2014, Csehy appeared in the Superior Court of Cobb County as counsel for a defendant in a jury trial. The trial court noticed that Csehy had bloodshot eyes, was perspiring profusely, and was unable to stand without leaning on something. As a result, the trial court ordered Csehy to submit to immediate drug testing which showed that he had cocaine and amphetamines in his system. Based on the test results, the trial court held Csehy in contempt and had him incarcerated for five days.
The State Bar had opposed the petition. (Mike Frisch)
The Georgia Supreme Court has ordered a 12-month suspension of an attorney convicted of wire fraud, notwithstanding the fact that the attorney had failed to report his 2007 conviction.
Early in his career, [the attorney] served as counsel to Governor Joe Frank Harris, was employed as an associate at a large Atlanta law firm, and worked for the United States Government. He later moved to academia, teaching at several colleges and universities. Since joining academia, [He] has maintained only a limited law practice, occasionally helping acquaintances on a pro bono basis and doing some estate planning and business law work.
In 2003, while employed as a teacher, [he] offered to help a student find financing for a film project. As [he] researched ways in which to raise capital for the project, he learned of an investment program that involved medium-term, high-yield notes. In his research, he did not learn anything unfavorable about this investment program, and he apparently believed that the program was a legitimate one. He agreed to present the investment program to potential investors. As it turned out, however, the investment program was a scam, and the potential investors to whom he presented it were agents of the Federal Bureau of Investigation.
The court cited the federal prosecutor's statement that the attorney was unaware of the scam as a mitigating factor. Further, he had ceased to practice after the conviction. (Mike Frisch)
An attorney has been reprimanded by the New Jersey Supreme Court for practicing while suspended (and doing a rather poor job of it at that):
The Disciplinary Review Board
In this matter, respondent met with the Peraltas after his license had been revoked, accepted a $750 fee from them, and then did little or nothing on their behalf. His paralegal may have drafted a petition, but did not follow through with it. Respondent also failed to communicate with the Peraltas; failed to return their fee; failed to inform them that his license had been revoked and that, therefore, they should retain a licensed New Jersey attorney to represent them; and, in essence, abandoned them. Indeed, at one point, the Peraltas found out that neither respondent nor his paralegal were "at the office address."
Because his license in New Jersey has been administratively revoked, he will not be allowed to seek reinstatement for a year after he becomes eligible.
He also may not seek pro hac vice admission. (Mike Frisch)
A disbarred lawyer is now a permanently disbarred lawyer as a result of a 2007 criminal conviction as a result of a decision of the Louisiana Supreme Court.
The lawyer was suspended in 2006 and disbarred in 2010
based upon his conviction of criminal mischief stemming from a violent physical altercation with his elderly father and his forging of a medical record at the request of a client whom he represented on drug charges.
In June 2007, respondent was driving with passenger Shannon Boudreaux when he was stopped by the Lafayette Police Department ("LPD"). The officers asked for respondent’s identification and discovered that his driver’s license had been suspended. The officers then arrested respondent, at which time respondent volunteered that there were "narcotics" inside the vehicle. Thereafter, officers from the Lafayette Parish Narcotics Unit were called to the scene. A subsequent search revealed the presence of approximately 200 alprazolam (Xanax) tablets. Respondent was then arrested and booked on charges of possession with intent to distribute Schedule IV narcotics. Respondent was later allowed to plead guilty to a misdemeanor (possession of drug paraphernalia) by the district attorney’s office.
Regardless of the fact that respondent’s misconduct may not definitively fit any of the specific permanent disbarment guidelines, his conduct demonstrates a clear lack of moral fitness. His behavior continues to place the public at risk and tarnish the image of the legal profession. In order to protect the public and maintain the high standards of the legal profession in this state, we find respondent should not be allowed the opportunity to return to the practice of law in the future.
Saturday, October 4, 2014
An attorney who failed to correct his client's false affidavit claiming sole heirship in an estate matter should be suspended for five months, according to a report and recommendation of the Illinois Review Board.
Following the death of James Volgar ("James") in 2008, Respondent agreed to represent James' brother, Paul Volgar ("Paul"), regarding the administration of his brother's estate. Paul was angry that Margaret Madonis ("Margaret"), a great-niece who had cared for James during his life, was named as a joint tenant on one of James' bank accounts. After James' death, Margaret received about $400,000. Paul wanted this money. Paul told Respondent that he was James' only heir. Based upon the information he received from Paul, Respondent drafted and filed in Will County an affidavit of heirship and letters of administration stating that Paul was the only surviving heir. The probate court then appointed Paul as administrator of the estate.
In early 2009, Respondent learned that Paul had lied to him and that James had additional heirs. However, Respondent took no steps over the following seventeen months to correct the false affidavit he had filed with the court or to file an amended affidavit of heirship. At hearing, Respondent asserted he failed to amend the affidavit of heirship because he simply forgot about it and forgot about the existence of other heirs. He testified he was more focused on the issue as to whether Paul could obtain the money received by Margaret. The Hearing Board rejected Respondent's testimony, finding it incredible, and noting that 1) Respondent discussed the existence of additional heirs with various individuals; 2) he conducted research regarding distribution law; and 3) he formulated a potential argument to limit the share of the other heirs. Accordingly, the Hearing Board found that Respondent knowingly failed to correct the false statement in the affidavit. Respondent does not challenge this finding.
Following Paul's appointment as administrator of the estate, Respondent used the false information regarding heirship to obtain information from financial institutions in an attempt to support Paul's claims against Margaret. Respondent also sold James' home in 2009 without notification to the other heirs. Respondent's mother-in-law was the listing real estate agent and Respondent was the title agent. Respondent took over $9,000 in attorney's fees from the sale proceeds, most of which was for fees Paul owed him to pursue the claim against Margaret.
In addition, Respondent repeated the false statement that Paul was an only heir in subsequent statements to the court, including in a motion for waiver of a surety bond filed in December 2009. At a hearing on the motion, the judge asked if Paul was the sole beneficiary to the estate and Respondent indicated to the court in the affirmative. As a result of his misrepresentation, the court granted his motion.
As to sanction
Respondent's misconduct was serious. When he learned his client had lied to him and that he had included those lies in material statements he made to the court, Respondent had an obligation to stand up to his client and to persuade his client to remedy the false statements. Respondent did not do so, and his repeated failure to do so over such an extended period of time warrants a sanction greater then a censure or a very brief suspension.
Friday, October 3, 2014
A significant announcement from the web page of the Pennsylvania Disciplinary Board.
To my mind, this is an example of how a responsible disciplinary system maintains public confidence in the profession. We will see the extent to which these proposals are adopted. (Mike Frisch)
The Disciplinary Board has published an extensive proposal for comment, which sets forth a number of changes to the Rules of Professional Conduct and Rules of Disciplinary Enforcement, intended to reduce the risk of large-scale misappropriation of funds causing severe stress on the Pennsylvania Lawyers Fund for Client Security and losses to individuals. The proposal was published September 27, 2014, at 44 Pa.Bull. 6070.
After several incidents of large-scale losses, including cases in which 20 or more claims were filed and millions of dollars in losses identified, the Board convened a working group comprised of the Board Chair, the Chair of the Rules Committee, the Board Secretary and representatives of the Office of Disciplinary Counsel. The group considered disciplinary mechanisms to prevent large-scale defalcations, beyond the deterrent effect of discipline and short of barring attorneys from handling fiduciary funds.
Several significant changes are set forth in the rulemaking intended to:
- impose certain restrictions on the brokering, offer or placement of investment products in relation to the provision of legal services;
- clarify required financial records, specify account reconciliations on a monthly basis, mandate prompt availability and production of records upon request or demand, and allow for the temporary suspension of an uncooperative respondent-attorney;
- require attorneys to provide on the annual fee form additional account information to assist ODC in the investigation of misappropriation cases and the preservation of fiduciary funds and other property;
- streamline procedures that impede investigations and that unnecessarily extend the time from initial detection of signs of theft to successful prosecution; and
- compel a suspended or disbarred attorney to promptly and completely disengage from the practice of law, and give ODC enhanced oversight authority to ensure that a formerly admitted attorney is not practicing.
Significant amendments to the following rules are proposed:
- Rule 1.15, RPC:
- Extensive changes to required records;
- Keep RPC 1.5(b) fee agreement with records;
- Individual ledgers for each client whose funds are kept in an account;
- Records must be electronically backed up daily;
- Trial balance must be performed on at least a monthly basis and kept for five years;
- Only lawyer or person directly responsible to a lawyer may be signatory or authorized to make transfers.
- Rule 5.6, RPC:
- New Paragraph (b) prohibits brokering, offering, selling, or placing any investment product in relation to the provision of legal services unless so licensed.
- New Paragraph (c) prohibits recommending or offering an investment product or investing fiduciary funds if the lawyer or a relative has an interest in the product
- Rule 208, RDE, Procedure: the Board may seek temporary suspension of an attorney who has failed to maintain or produce records required by RPC 1.15.
- Rule 213, RDE, Subpoena power, depositions and related matters: changes to procedure for challenging a subpoena.
- Rule 215, Discipline on Consent:
- The fact of disbarment by consent becomes public immediately upon delivery of the resignation statement to Disciplinary Counsel;
- Upon entry of the order disbarring the attorney on consent, the attorney must promptly comply with the notice, withdrawal, resignation and cease-and-desist provisions of Rule 217, RDE.
- Rule 217, RDE, Formerly Admitted Attorneys:
- Notice of suspension or disbarment is delivered to clients by the most efficient means available that provides for proof of delivery;
- Wards, heirs and beneficiaries must be notified;
- Any tribunal, court, agency or jurisdiction in which the attorney is admitted to practice must be notified;
- Formerly admitted attorney must:
- Resign all appointments as personal representative, executor, administrator, guardian, conservator, receiver, trustee, agent under a power of attorney, or other fiduciary position;
- Close every IOLTA, trust, client and fiduciary account;
- Properly disburse or otherwise transfer all client and fiduciary funds;
- Cease and desist from using all forms of communication that express or imply eligibility to practice law in the state courts of Pennsylvania, including professional titles, letterhead, business cards, signage, websites, and references to admission to the Pennsylvania Bar;
- Cancel or discontinue the next regular publication of all advertisements and telecommunication listings stating or implying eligibility to practice in Pennsylvania;
- Cooperate with Disciplinary Counsel and respond completely to questions by Disciplinary Counsel regarding compliance with Rule 217.
- Rule 218, RDE, Reinstatement: The waiting period for eligibility to apply for reinstatement to the practice of law does not begin until the formerly admitted attorney files the verified statement required by Rule 217.
- Rule 219, RDE, Annual Registration of Attorneys:
- All attorneys must report all accounts that held funds of a client or third party;
- Must report business operating accounts;
- The statement that attorney understands RPC 1.15 and RDE 221 requirements is made subject to the penalties of 18 Pa.C.S. § 4904 relating to unsworn falsification to authorities, and attorney is subject to discipline for a false statement.
- Rule 221, RDE, Funds of Clients and Third Persons:
- Echoes record-keeping requirements of Rule 1.15;
- If Disciplinary Counsel requests production of required records, an attorney must produce them within five business days (eight under some circumstances);
- Failure to produce required records may result in the initiation of proceedings for emergency temporary suspension.
Written comments by mail, email, or facsimile regarding the proposed amendments should be sent on or before November 3, 2014, to:
Office of the Secretary
The Disciplinary Board of the Supreme Court of Pennsylvania
601 Commonwealth Avenue, Suite 5600
PO Box 62625, Harrisburg, PA 17106-2625
E-mail address Dboard.firstname.lastname@example.org
Facsimile number (717-231-3382)
Thursday, October 2, 2014
Adrian Cronauer, the disc jockey who was portrayed by the late Robin Williams in Good Morning Vietnam, has consented to disbarment in the District of Columbia.
The Board on Professional Responsibility has accepted his affidavit of consent and forwarded a report to the Court of Appeals for final action.
In the District of Columbia, the facts and circumstances of the admitted misconduct remain confidential when an attorney consents to disbarment.
Thus, the story behind the story may never be told. However, there may be a clue in this report
The National Community Reinvestment Coalition (NCRC) has filed complaints with the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) against Adrian Cronauer and the Cronauer Law Center. Mr. Cronauer, who is best known as the radio disc jockey who inspired Robin Williams' character in the film Good Morning Vietnam, now runs Cronauer Law Center, a Washington, D.C. based law firm. NCRC's complaints allege that Mr. Cronauer and Cronauer Law Center have intentionally misled consumers through misrepresentations and deceptive and fraudulent loan modification and foreclosure prevention practices.
NCRC President and CEO John Taylor made the following statement:
"Scammers who cause injury to homeowners under the guise of offering assistance must not be tolerated. The rules apply to celebrities as well. We believe Mr. Cronauer and the Cronauer Law Center to be in violation of the Federal Trade Commission Act, the Mortgage Assistance Relief Act rules, and other state and federal laws. We look forward to regulators reviewing our complaints and investigating this important matter further."
"The unfortunate reality is that law firms are culprits in a growing number of mortgage scams. In addition to legal action, we're calling on the American Bar Association to police its members," said Taylor.
The board report can be found at this link by inserting the attorney's name. (Mike Frisch)