Sunday, June 28, 2015

"Attorney" Kriger Calling

An attorney who had been suspended for two years and never reinstated has been indefinitely suspended by the Massachusetts Supreme Judicial Court.

The story

the respondent began working at his prior firm, unpaid, as a “settlement consultant.” For the following ten weeks or so, the respondent reviewed files, valued cases, determined demand amounts, negotiated settlements with insurance adjusters, and communicated with clients about settlement offers, without any adequate supervision. In handling and settling personal injury cases without supervision, the respondent was engaging in the unauthorized practice of law. Further, to the extent that the respondent was engaging in paralegal work, he failed to obtain permission from the Supreme Judicial Court to work as a paralegal...

In his conversations with insurance adjusters, the respondent falsely identified himself as “Jeffrey Kriger” in order to conceal his identity as a suspended attorney. At times, the respondent also either identified himself as “Attorney Kriger” or failed to correct any misunderstanding that he was an attorney at the firm.

He had been reprimanded before suspension number one for his

intemperate remarks during mediation and his use of vulgar and insulting language was intended to disrupt a tribunal and was prejudicial to the administration of justice in violation of Mass. R. Prof. C. 3.5(c), 8.4(d), and 8.4(h), and his use of profanity and his verbal abuse of opposing counsel and insurance claims representatives...

(Mike Frisch)

June 28, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Saturday, June 27, 2015

Frustration Leads To...

A frustrated Massachusetts attorney was reprimanded for altering a form insurance letter that he had received for one client for the benefit of a second client.

The respondent had previously represented another client with both Med-Pay and BCBSMA coverage. In that case, BCBSMA provided the respondent with a standard-form letter stating that whenever a claimant has Med-Pay coverage, BCBSMA considers the Med-Pay coverage to be primary.

He tried to deal with insurance reps at BCBSMA to no avail and then

altered a Med-Pay letter he had received from BCBSMA for another client by redacting the other client’s information and inserting the current client’s name, her BCBSIL identification number and date of injury on the letter. The respondent forwarded the altered letter to the automobile insurer in an effort to have them cover the client’s medical expenses through its Med-Pay coverage.

The agreed sanction was approved by the Board of Bar Overseers. 

Dealing with insurance companies can certainly be a source of major frustration. This does not alter the fact that altering a document is not the solution. (Mike Frisch)

June 27, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Friday, June 26, 2015

Ethics Rules And Civil Liability

The Nebraska Supreme Court has affirmed the dismissal of claims against an attorney pressed by his late friend and client's former husband

The present litigation involves [attorney] Larson, who was a friend of Judy’s. Judy and Larson met in the early 1990’s when both represented different defendants in a federal criminal case. Over the years, Larson assisted Judy in various legal matters, including continuing legal matters relating to her divorce from [plaintiff] Gallner. Larson, who resides in another state, would also periodically visit Omaha for personal and professional activities. On those visits, Larson would sometimes stay at Judy’s home. Judy attended Larson’s wedding and also attended Larson’s wife’s funeral. Judy introduced Larson to her parents. Jordan testified that Larson was a close friend of Judy’s and that he, Jordan, telephoned Larson upon Judy’s eventual death.

Judy named Larson as her successor trustee and beneficiary. His representation of her involved unrelated matters.

He received over $236,000 after her death.

The court rejected the plaintiff's contention that the business transaction rule created liability to his benefit

The record clearly shows that at the time Judy made Larson a beneficiary on the American Family policy, he was representing her in legal matters. It is axiomatic that the relationship between attorney and client is a fiduciary or confidential one, and there is nothing that suggests the informality between Judy and Larson makes the relationship less so. We conclude that because Larson was Judy’s attorney, he has the burden to show that the gift from Judy was fair.

We conclude that Larson has met his burden. As the district court noted, Judy was herself a lawyer. She did not suffer from any diminished mental capacity and was not elderly or incapacitated. She understood the consequences of her designation...

In addition, at the time Judy first contacted Larson regarding the American Family policy, she had already also engaged the services of another lawyer for estate planning purposes. She did not seek Larson’s advice with regard to the drafting of the unexecuted trust or with respect to the change in beneficiary on the American Family policy. Larson did not seek the designation as beneficiary and was unaware of it until after the designation was made. And because Larson had done much uncompensated legal work for Judy, the designation seemed reasonable to Larson.

The ethics rules do not create a cause of action

we note that Gallner essentially argues that Larson violated the disciplinary rules applicable to Larson as an attorney, and therefore breached a duty to Judy. But as we note above, the rules are designed to provide guidance and “not designed to be a basis for civil liability.”

Nor did an asserted malpractice case exist under the circumstances

there is simply no evidence of an employment relationship regarding estate matters upon which to base a malpractice claim. Larson plainly did not represent Judy on any estate planning matter. Nor can Gallner show a neglect of duty. We concluded above that Larson showed on these facts the designation of him as beneficiary was fair. Finally, Gallner cannot show any loss, because as noted above, Judy’s father, not Jordan or the estate, was the contingent beneficiary on the American Family policy. We find no merit to this argument.

(Mike Frisch)

June 26, 2015 in Bar Discipline & Process | Permalink | Comments (0)

AUSA Admonished For Misleading Statement To Tribunal

The District of Columbia Office of Bar Counsel has informally admonished an Assistant United States Attorney

We find that you violated Rules 8.4(c) which prohibits engaging in conduct involving "dishonesty, fraud, deceit, or misrepresentation." This violation occurred when you responded, as a representative of the United States, to a question from a Superior Court judge with a misleading answer. When the court asked if the family of a homicide victim had asked to be heard at the plea hearing, you responded by stating that they had not asked to be heard at the plea. When you made this response, you were aware that the family had not asked to be heard at the plea hearing because they were not aware of it and you were aware that it was your responsibility to notify them of the hearing, either directly or through the victim's advocate from your office.

An attorney may reject an informal admonition, in which case Bar Counsel files charges that proceed in the normal course.

My understanding is that these admonitions are not published until after the time to reject the sanction has expired.

The case is In re Charles Cobb. (Mike Frisch)

June 26, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Mouse Clicks And Fair Trials

The Iowa Supreme Court reversed the Court of Appeals and reinstated a second degree murder conviction, rejecting a claim of juror bias. 

The juror had disclosed that she knew and was Facebook friends with a relative of the victim but

there is no evidence the juror provided false testimony during voir dire...

Webster’s lawyer elected not to thoroughly explore the nature of the relationship, including the intriguing mention that she and Frisbie’s stepmother were friends on Facebook. Instead, Webster’s counsel asked a series of questions that seemed more designed to rehabilitate the juror than challenge her. At the conclusion of the hearing, Webster did not challenge the juror for cause. Based on the record before us, we cannot conclude the juror engaged in misconduct by lying during the in camera hearing.

This was of some concern

That brings us to the most troublesome point in the case. There is some suggestion the juror, after the in camera inspection but prior to the verdict, clicked “like” on a Facebook comment by the victim’s stepmother which stated, “Give me strength.” A juror who directly violates the admonitions of the court and communicates with the mother of a crime victim about a case certainly raises questions about her ability to be an impartial juror. This action occurred after voir dire and apparently after the in camera hearing. Thus, Webster has not waived his bias challenge based upon this event, which would not have been uncovered through diligent use of ordinary trial processes. However, the record here does not disclose the court’s initial admonition or when the juror clicked “like.” In any event, while the short form admonition to the jury in the record indicated that the juror should not communicate with parties and witnesses about the case, the juror apparently thought (erroneously) that merely clicking “like” on Facebook was not a “communication.” Moreover, the communication did not relate to the guilt or innocence of the accused, but only showed a degree of empathy for a grieving stepmother who lost her son. A juror who does not have empathy for a grieving mother whose son was a homicide victim would be awfully cold hearted. If we disqualified jurors because they empathized with the family of crime victims, we would have no jurors...

Notwithstanding our resolution of the issues in this appeal, we do not approve of the juror’s conduct in this case. While the click of the mouse does not require reversal of Webster’s criminal conviction, it is troublesome nevertheless. While it did not occur in this case, a single click of the mouse on Facebook can trigger cascading responses. Further, messages posted on Facebook may be viewed by many persons, generating a perception of a miscarriage of justice. In the future our district courts would do well to recognize that in this day and age, our jurors are part of the new electronic world. This can pose a problem in our jury trials. We have held that the click of the mouse in this case was not misconduct sufficient to require a new trial...

The court provides a useful summary of the emerging body of case law and scholarship on social media and juror misconduct. (Mike Frisch)

June 26, 2015 in Hot Topics, Law & Society | Permalink | Comments (0)

Sobriety Lapse VIolates Probation

The Pennsylvania Supreme Court found that an attorney had violated the terms of a previously-imposed probation and suspended him for a year and a day.

He was required to cooperate with a sobriety monitor

Mr. Lefevre's testimony was credible and persuasive. He noted that from the beginning of the probation period, Respondent never completely complied with all conditions of probation. Mr. Lefevre discussed his concerns with Respondent in May of 2014 and noted improvement on Respondent's part, but never full compliance. At a certain point, Mr. Lefevre stopped hearing from Respondent altogether. From December 4, 2014 to December 29, 2014, Respondent had no contact with Mr. Lefevre. There was contact on December 29, 2014, but Mr. Lefevre felt that Respondent's attitude regarding his significant lapse in communication was cavalier. After December 29, 2014 until April 18, 2015, Respondent had no contact with Mr. Lefevre. Mr. LeFevre attempted to contact Respondent on two occasions in February of 2015, with no success. The April 18, 2015 voice mail from Respondent to Mr. Lefevre indicated that Respondent, by his own admission, had relapsed from his sobriety. Mr. Lefevre attempted to contact Respondent but was unsuccessful and has not had any communication with Respondent since that voicemail.

The Disciplinary Board viewed the violation as a "serious matter." (Mike Frisch)

June 26, 2015 in Bar Discipline & Process | Permalink | Comments (0)

A Taste For Fine Wine At No Cost

Kathleen Maloney reports this discipline decision on the web page of the Ohio Supreme Court

In a unanimous ruling, the Ohio Supreme Court suspended Rodger W. Moore of Fort Mitchell, Kentucky, for two years with one year stayed because he had shoplifted on seven occasions and later lied about it to the Cincinnati Bar Association.

Admitted to practice in Ohio in 2001, Moore was arrested the same year in Atlanta, Georgia, for allegedly stealing 12 bottles of wine from a grocery store. The wine averaged a little more than $12 per bottle. He agreed to do 65 hours of community service.

In March 2012, Moore again was caught shoplifting three bottles of wine – more expensive vintages this time – along with olive oil at a Cincinnati grocery store. Instead of walking out with the items, he brought UPC codes for less pricey items with him and scanned those at the self-checkout. The false UPC codes reduced the price of the groceries by $359.10.

Moore pled guilty and was allowed to enter a diversion program. He also confessed he had taken expensive bottles of wine this way from the same store five other times.

His lawyer advised him to report the March 2012 charge to the bar association. In correspondence, as well as an interview, with the bar association during an investigation, Moore made false statements about the incident and did not disclose his other thefts.

In imposing the sanction, the court noted that Moore showed an unwillingness to take responsibility for his misconduct. The decision set out specific conditions the attorney must follow to have one year of the two-year suspension stayed and described other requirements for his reinstatement.

2014-1737Cincinnati Bar Assn. v. MooreSlip Opinion No. 2015-Ohio-2488.

(Mike Frisch)

June 26, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Thursday, June 25, 2015

Attempted Murder Is Crime Of Moral Turpitude

J. Michael Farren has been disbarred by the District of Columbia Court of Appeals.

...Mr. Farren was convicted of, among other things, attempted murder in violation of C.G.S. §§ 53a-49 (a)(2) and -54a (a), which is a crime that “requires a finding of the specific intent to cause death.” State v. Murray, 757 A.2d 578, 583 (Conn. 2000). In examining a crime requiring the same intent to kill, this court deemed it to be “self-evident” that murder is a crime of moral turpitude per se for purposes of attorney discipline. See In re Carpenter, 891 A.2d 223, 223-24 (D.C. 2006) (concluding that murder for pecuniary gain under C.G.S. § 53a-54 (b) is a crime of moral turpitude per se because it requires proof of the specific intent to cause death and noting that “[f]irst-degree murder . . . offends the generally accepted moral code of mankind” (citation omitted)). We hold that Mr. Farren’s crime of attempted murder is also one of moral turpitude per se and, as a result, one that requires disbarment under D.C. Code § 11-2503 (a).

The Stamford Advocate reported on the sentencing

Farren picked up his wife by the throat, threw her across the room and struck her head and face as many as 10 times with a heavy metal flashlight, according to testimony during his trial in early July. He strangled her more than once during the attack, causing her to lose consciousness.

She lost a significant amount of blood, suffered a broken jaw and cheek bone as well as deep cuts to her head that left her skull visible, and tufts of hair had been wrenched off her scalp, a doctor said on the stand. Her smile is now crooked from the nerve damage to her right cheek from the attack.

On July 1, Farren, 61, who was an attorney serving in both Bush White Houses and a general counsel for Xerox Corp., was convicted by a six-person jury of attempted murder, first-degree assault and risk of injury to a minor.

Does anyone find it remarkable that there is a D.C. precedent for this proposition?

The case involved, believe it or not,  another D.C. admitted attorney convicted of murder in Connecticut.

Thankfully, this court has not had to consider before, in regard to attorney discipline, whether first-degree murder is a crime of moral turpitude per se. But the answer is self-evident. First-degree murder —including murder for pecuniary gain—"offends the generally accepted moral code of mankind."

I had argued the issue in the high-profile Ruthann Aron case when I was at Bar Counsel.

Unfortunately, she consented to disbarment after full briefing and oral argument. (Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

No Liability For Blogging Attorney

The District of Columbia Court of Appeals affirmed the dismissal of claims brought against a law firm that had represented a co-worker of the plaintiff.

The plaintiff had given information to the co-worker (Ren) who in turn provided it his attorneys.

In July of 2013, Ren and other co-employees of appellant filed suit against Phoenix, alleging that they had suffered retaliation for their role in helping appellant. They retained the law firm Bernabei & Wachtel, PLLC (“B&W”), to represent them, and appellant alleges that Ren subsequently gave B&W a copy of the video. B&W issued a press release in Chinese and English that resulted in multiple news stories.

Appellee Lynne Bernabei, a lawyer in the B&W law firm, allegedly used appellant’s full name on her micro-blog, and also conducted an interview on a website that included appellant’s full name in the text of the interview, as well as a copy of the video depicting appellant’s workplace incident. Appellees also allegedly released the video to local television stations, and posted it for public consumption on YouTube. Appellant learned of the video’s publication when friends, colleagues and members of the public began to ask about the video and her association with it; appellant claims that as a result she suffered severe emotional distress.

Retaining counsel again in September of 2013, appellant filed suit against the instant defendants, alleging four counts of invasion of privacy, two counts of copyright infringement, and additional counts of intentional and negligent infliction of emotional distress. The copyright infringement counts were dismissed early in the litigation, and all of the remaining counts (for invasion of privacy and infliction of emotional distress) were dismissed following defendants’ motion to dismiss, and a subsequent motion for partial reconsideration. This appeal followed.

The court rejected a variety of causes of actions such as invasion of privacy, misappropriation, false light and infliction of emotional distress. 

The author of the opinion - Senior Judge William Pryor - is, in my opinion,  the greatest jurist I have ever known. (Mike Frisch)

June 25, 2015 | Permalink | Comments (0)

Out Of Kokomo

An attorney who had abandoned his law practice in Kokomo and left for Australia was disbarred by the Indiana Supreme Court.

The eleven counts of misconduct in this case arise from Respondent’s abrupt abandonment of his Kokomo law practice and move to Australia in September 2013, two days after enlisting Brent Dechert as his attorney surrogate. See Admis. Disc. R. 23(27). Counts 1 through 7 each involve particular clients who retained Respondent to file bankruptcy petitions. In each case, Respondent was paid a retainer fee up front, did little or no work on the case thereafter, and eventually absconded to Australia without refunding or making arrangements to refund unearned legal fees. In most of the cases, Respondent was largely unresponsive to client inquiries regarding case progress, and in two of the cases Respondent knowingly misrepresented to the client that a bankruptcy petition had been filed when in fact no petition had been filed. Counts 8 through 10 are similar in nature and involve particular clients who retained Respondent in various non-bankruptcy matters. Finally, Count 11 charts twenty-two additional clients of Respondent identified by Dechert as having been abandoned by Respondent with legal matters still pending, and to whom unearned fees are still owed. In sum, Respondent was paid a total of $58,366 by the clients identified in these eleven counts. None of these clients’ legal matters were completed by Respondent. The balance in Respondent’s attorney trust account at the time it was turned over to Dechert was $2,060, with no records left indicating to which client or clients that sum belonged.

An aggravating factor was his accepting new clients and retainers when his plan to leave the country was in place.

For a variety of reasons, an attorney may be faced with the need or desire to wind down his or her law practice. Whatever the reason, the attorney’s ethical obligation to protect clients’ interests is clear. Among many other things, key practice management records (such as client files and business and trust accounts) should be in order and reconciled, clients should be notified and kept fully and accurately informed of matters relating to their case, fee issues should be resolved, and appropriate contingency plans for transitioning clients’ cases to successor counsel should be implemented.

Respondent did virtually none of these before absconding to Australia. He did not reconcile his trust account; he looted all but a small portion of it and left behind no records indicating to which client(s) that remaining sum belonged. He did not notify clients of the status of their cases; when clients inquired, Respondent mostly avoided them and in some instances lied to them. Respondent did not refund unearned fees; he stole them. Most clients were not notified of his impending move out of the country, and Respondent continued to accept new clients (and their money) even as the abandonment of his law practice was imminent. Finally, while Respondent did enlist the aid of Dechert as an attorney surrogate, Respondent did so at the last minute and in a manner that precluded Dechert, despite his commendable efforts to triage the harm caused by Respondent, from being able to fully protect the interests of Respondent’s clients

(Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Disbarred Without Hesitation

The Indiana Supreme Court disbarred an attorney

Respondent, Robert Stochel, committed attorney misconduct by stealing trust account funds belonging to a former law partner and that partner’s clients, embezzling funds from a receivership and actively concealing that theft for nearly a decade, and refusing to cooperate with the Commission’s investigations into his actions.

He stole from a receivership as well as his former partner.

The court

We conclude that each of these [sanction] standards applies to the matter before us. Respondent stole hundreds of thousands of dollars from the receivership and tens of thousands of dollars from his former law partner and that partner’s clients. In the receivership case, Respondent covered up his theft for nearly a decade, lied to all comers, deceived the court and later defied its orders, and actively obstructed the disciplinary process. Respondent throughout has expressed absolutely no remorse or intent to make restitution. In addition, he has neither challenged the hearing officer’s report nor argued any mitigating facts. Under these circumstances, the Court unhesitatingly concludes that disbarment is warranted.

The Indiana Lawyer had reported on his emergency suspension by the court. (Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Serious Sanction Warranted

The Wisconsin Supreme Court has imposed a three-year suspension of an attorney who did not place advance fees in escrow and failed to perform services

With respect to the appropriate sanction, the referee noted that this case includes many instances where Attorney D'Arruda accepted monetary payments from clients for legal services he was to render.  In many instances, those initial payments by clients were placed into Attorney D'Arruda's business account rather than into his trust account.  Attorney D'Arruda repeatedly failed to provide an itemized statement to his clients or otherwise account for the disposition of payments received from his clients.  The referee said that this conduct was similar to that for which Attorney D'Arruda was both privately and publicly reprimanded in the past.  The referee said:

I am most bothered by the fact that in numerous instances, when Attorney D'Arruda knew his license to practice law was going to be temporarily suspended, he continued to accept new cases and payments from new clients, knowing he was about to have his license temporarily suspended.  Without the benefit of an explanation from Attorney D'Arruda, I can only conclude that Attorney D'Arruda knowingly accepted monetary payments from new clients and that he had no intention of fulfilling his duties to represent the clients or return the money once his license was temporarily suspended.  In other words, Attorney D'Arruda intentionally took money from new clients with no intention of providing legal services to them and with no intention of refunding the money paid by these clients.  This is intentional misconduct of a most serious nature.

The court

This case involves 42 counts of misconduct affecting 12 clients.  In all three [comparable] cases, the attorneys failed to comply with clients' requests for information, failed to explain matters to the extent reasonably necessary to permit clients to make informed decisions regarding the representations, and failed to timely respond to the OLR's requests for information.  Although Attorney D'Arruda's prior disciplinary history is not extensive, the misconduct at issue here is very serious and warrants a significant sanction.  We also agree that Attorney D'Arruda should make restitution as recommended by the referee and that he should be required to bear the full costs of this proceeding.

(Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

D.C. To Consider Screening

From the web page of the District of Columbia Court of Appeals

Comments Sought on Move to Amend Rules 1.10, 1.15, and 7.1

June 16, 2015

The District of Columbia Court of Appeals is soliciting public comment on proposed amendments to the D.C. Rules of Professional Conduct that include revisions to Rules 1.10 and 7.1 and comments thereto, and the addition of a new comment to Rule 1.15.

The proposed amendments were submitted to the court by the D.C. Bar Board of Governors on recommendation of the Bar’s Rules of Professional Conduct Review Committee.

The proposed amendments are summarized below:

A. Rule 1.10 (Imputed Disqualification: General Rule)
Amend Rule 1.10 and its comments to allow ethical screening (without client consent) of lawyers moving laterally between private employers with certain initial notice requirements to former clients. The committee further recommends the addition of a new subparagraph (f) to address situations in which a law firm cannot provide required notifications without violating confidentiality obligations to an existing client.

B. Rule 7.1 (Communications Concerning a Lawyer’s Services)
Amend Rule 7.1 and its comments to prohibit the payment of referral fees, but continue to allow payment of the usual and reasonable fees or dues charged by a lawyer referral service. These changes will restore the approach the District used prior to the 1991 adoption of a rule allowing the use of paid intermediaries or “runners,” which was repealed in 2007.

C. Rule 1.15 (Safekeeping Property)
Adopt a new Comment [2] of Rule 1.15 to provide more detailed guidance to lawyers on financial record keeping for trust accounts. Delete Section 19(f) of Rule XI of the Rules Governing the Bar as largely duplicative of the obligations arising under Rule 1.15(a). The committee recommends that the guidance on financial record keeping: (1) reflect the purpose of the “complete records” language of Rule 1.15 as interpreted and explained by the D.C. Court of Appeals in In re Clower, 831 A.2d 1030 (D.C. 2003); and (2) encourage lawyers to consult the ABA Model Rules on Client Trust Records.

Read the court’s notice of public comment as well as additional information about the Bar’s proposal, including the report of the Rules Review Committee.

The Court of Appeals declined to accept the committee’s recommendation to establish a new Rule 8.6 that would have imposed on all Bar members a duty to disclose exculpatory information about a convicted person and has instead asked the committee to study further ABA Model Rules 3.8(g) and (h) and whether the D.C. Rules should be amended to include those provisions.

Ten copies of any written comments should be submitted to the Clerk, D.C. Court of Appeals, 430 E Street NW, Washington, DC 20001, by August 10. All comments submitted concerning the proposed amendments will be available to the public.

(Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Thy Partners Brothers Keeper

A six-month suspension was ordered by the New York Appellate Division for the Second Judicial Department as a result of conduct that was committed by  his law partner's brother

The charges against the respondent arise from his conduct, as a law partner of Peter Galasso, relative to the maintenance of fiduciary funds held by their firm (hereinafter the firm), incident to the practice of law. As in the case against Peter Galasso, the charges against the respondent center around the undisputed misappropriation of more than $5 million from the firm's multiple escrow accounts. The respondent, like Peter Galasso, did not directly engage in the misappropriation of client funds. Rather, fiduciary funds held by the firm were misappropriated by Peter Galasso's brother, Anthony Galasso, the firm's bookkeeper and office manager.

Anthony Galasso, in his capacity as office manager, deposited the funds into an escrow account at Signature Bank (the Baron escrow account). [Peter Galasso] and fellow partner James Langione were the only authorized [signatories] on the account application. However, Anthony Galasso apparently altered the application to permit electronic fund transfers and to include himself a—[nonlawyer]—as a [signatory].

 Between June 23, 2004, and January 1, 2007, Anthony Galasso transferred approximately $4,501,571 from the Baron escrow account into six other firm accounts maintained at Signature Bank through the use of roughly 90 Internet transfers. It seems that the Baron funds were used to replace money that Anthony Galasso had already removed from [other] firm accounts. Transferred funds from the Baron escrow account were then disbursed to [Peter Galasso], firm employees and other entities in the course of business, all without the knowledge of the firm's principals or the consent of the Barons. In particular, approximately $360,000 in funds transferred from the Baron escrow account were used to finance the purchase of the firm's office condominium. To escape detection, Anthony Galasso had the genuine Baron escrow account statements, generated by the bank, diverted to a post office box and fabricated false statements for review by the firm . . . .

 Anthony Galasso confessed to the theft of the above funds on January 18, 2007, and ultimately pleaded guilty to two counts of grand larceny in the first degree, 10 counts of falsifying business records in the first degree and 10 counts of criminal possession of a forged instrument in the second degree. He was sentenced to [two and a half] to [seven and a half] years' imprisonment, as well as $2,000,000 in restitution.

 As in the case of Peter Galasso, the respondent's culpability is predicated upon his failure to properly oversee the management of the firm's bank accounts, including necessary supervision of the firm's employee, Anthony Galasso.

His culpability was of a lesser degree than that of the Brothers Galasso

Unlike the respondent's partner, Peter Galasso, the respondent received no "unjust enrichment" from the defalcations by Anthony Galasso. Indeed, the respondent injected personal funds into the firm's purchase of an office condominium, rather than funds derived from the fraudulent activities of Anthony Galasso, as Peter Galasso did.

Moreover, the respondent attempted to make restitution to his aggrieved clients—the Carroll Estate, Adele Fabrizio, and Theresa Halloran—from his personal funds, independent of, and in addition to, settlement funds obtained and disbursed as a result of litigation.

Under the totality of the circumstances, the respondent is suspended from the practice of law for a period of six months.

Peter Galasso was suspended for two years. (Mike Frisch)

June 25, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Wednesday, June 24, 2015

Attorney Who Failed To Report Abuse Disqualified

An opinion from the Oklahoma Supreme Court

The issue before this Court is whether the district court erred in sustaining the legal parent's motion to disqualify opposing counsel. The question we consider is whether the integrity of the judicial process is likely to suffer real harm when an attorney who represents a client in a proceeding to establish paternity and to determine custody of a minor child fails to report suspected child abuse to the proper authorities as required by statute, conducts a forensic interview of the child to obtain evidence to support the client's position, does not obtain the legal parent's permission prior to the interview, and files his own affidavit attesting to the credibility of the child's affidavit. We find that the district court did not err in sustaining the motion to disqualify opposing counsel when the attorney likely compromised the legal parent's right to a fair proceeding by contaminating the fact-finding procedure and by establishing a relationship of undue influence with the child...

Attorney inserted himself into the paternity proceeding as a forensic interviewer, interviewed a minor child without parental consent, and submitted a signed affidavit attesting to Child's credibility. Attorney and Child were the only persons present during the interview. Thus, Mother's only option to rebut the evidence presented in Child's affidavit, to ascertain what type of relationship Attorney may have established with Child during the interview, and to determine if Attorney distorted Child's recollections by suggestive or leading questions would be to call Attorney as a witness to Child's credibility. Were Attorney to testify at trial, the integrity of the judicial process would be harmed in all the ways Rule 3.7 is designed to protect against: (1) Attorney's interest in winning the case for Client would call into question his objectivity as a witness, (2) Attorney's dual role as advocate-witness could confuse the factfinder, and (3) public confidence would be shaken were Attorney allowed to interview Child without parental consent.

Holding

A lawyer is not prohibited from interviewing a child witness, and nothing in this opinion should be construed to prevent an attorney from interviewing a child witness. However, if an interview scenario results in circumstances similar to those here, then he or she is no longer able to continue as an attorney in that particular case. A lawyer in a proceeding to establish paternity and to determine custody of a minor child who ignores his statutory duty to report suspected child abuse, inserts himself into the role of forensic interviewer, interviews the minor child without the legal parent's consent, likely taints the fact-finding process with improper interviewing techniques, likely establishes a relationship of undue influence with the child witness, and submits affidavits attesting to a fact witness's credibility should be disqualified from all aspects of the proceeding. Mother proved by a preponderance of the evidence that Attorney's continued representation will likely cause real harm to the integrity of the judicial process. We affirm the district court's order sustaining the motion to disqualify counsel and remand for further proceedings. Attorney is disqualified not only from acting as an advocate at trial, but also from acting as an advocate in all aspects of the underlying proceeding.

There is a concurring/dissenting opinion that would disqualify counsel but not impose the "blanket restrictions" of the majority opinion.

While I concur that under the particular circumstances, the attorney in this case should be disqualified; I do not believe lawyers should be per se prohibited from interviewing a child witness in custody disputes. Of paramount importance in any legal decision affecting the welfare of a child is consideration of his or her best interests. The majority opinion renders this basic principle subservient to the mother's custodial rights and the majority's perceived transgression of ethical boundaries governing attorney conduct...

the abuse suffered by the minor child in this case was shocking. So much so, the trial court issued an emergency order placing custody of the child with father--a direct result of the efforts undertaken by counsel and father. There were allegations the step-father drank excessively, hit the minor child, and imposed inappropriate discipline such as forced calisthenics. Additionally, it was suggested mother inflicted undue physical punishment on her son. However, the real issue presented in the trial court was the sexual abuse endured by this child. Although mother and step-father were not the perpetrators, mother had knowledge of the child's illicit encounters. She discovered the molestation and notified father. However, she apparently did not fully disclose the severity of the situation and urged him not to confront the child. On January 11, 2014, the child voluntarily disclosed the ongoing sexual activity to his father.

The father's efforts to get help through public agencies failed

After receiving no assistance from DHS and weighing the urgency of the situation, father sought to protect his son by contacting his attorney. While the attorney's interview in this case may have exceeded what was necessary, there is no ethical proscription which forbids attorney interviews of children.  Moreover, at the time the child was not represented by counsel and a guardian ad litem had not been appointed. Inherent in a lawyer's responsibilities is the obligation to thoroughly evaluate the facts of each case. This includes seeking information through witness interviews. It should be noted that [attorney] Thomas served as a Tulsa County Sherriff's Deputy for ten years prior to entering law school. During his service, Mr. Thomas interviewed numerous victims of criminal acts, including child and domestic abuse.

 (Mike Frisch)

June 24, 2015 in Law & Society, Professional Responsibility, The Practice | Permalink | Comments (0)

Busman's Holiday

A matrimonial attorney who represented himself in his divorce merited sanctions imposed by the trial court, according to an opinion of the New York Appellate Division for the First Judicial Department.

The parties were divorced pursuant to a judgment entered in December 2009. Plaintiff husband is an experienced matrimonial lawyer and he represented himself in the divorce proceeding. He was sanctioned twice during the course of that action. The first time he was ordered to pay $7,500 in attorneys' fees in connection with defendant wife's motion to enforce a pendente lite order against him. He was later directed to reimburse the wife $10,000 in connection with his violation of an order directing that a boat that was marital property be sold in an arm's length transaction, with the proceeds to be shared by the parties.

After the divorce

The husband then commenced this action against the wife. The complaint sought recovery of the same $27,000 sought by the husband as a credit in the divorce action. It did not refer to the divorce proceeding or the fact that the husband had sought repayment of the loan in a proceeding that had ended in a final judgment. The wife's counsel sent the husband a letter asking him to discontinue the action voluntarily because the divorce action had determined his rights regarding the loan in light of the court's ruling on the husband's request for credits.

The wife did eventually move for summary judgment dismissing the complaint, arguing that the husband's claim was barred by res judicata principles because it had been fully litigated in the divorce action. She also argued that the loan was not enforceable because the funds that the husband transferred to her were marital property. The wife submitted excerpts from the husband's deposition testimony in the matrimonial action, in which he acknowledged that the loan funds were derived from compensation he received for an arbitration or mediation he completed while the parties were married. He also admitted that he had sought a credit for the loan in the divorce action.

The court

...the issue is not whether the husband should have prevailed on his claim in the matrimonial action, but whether he had any grounds for pursuing the matter after that action became final. It simply defies logic that, as the husband argues, the court in the matrimonial action would have implicitly ruled that the loan was separate property, when he conceded before it that the source of the funds was marital property. Further, the husband utterly fails to account for the court's explicit statement that any arguments it did not address should be considered rejected.

Aside from the blatant lack of merit to the complaint, other factors justifying sanctions and attorneys' fees are present here. First, the wife expressly informed the husband that she considered the action barred by res judicata and urged him to discontinue it, but he pressed on, forcing her to expend unnecessary resources. Such unreasonable persistence in a position that has been demonstrated to be frivolous warrants the imposition of sanctions...Further, we cannot ignore that this is not the first instance in which the husband has taken a position that is not legally tenable. He was ordered in the matrimonial action to pay the wife's legal fees in connection with his noncompliance with a temporary support order. While the court did not expressly opine that his conduct was frivolous, it can be presumed that he failed to present any good faith basis for his failure to abide by the order. Later in the action, however, the court explicitly stated that the husband had "frivolously" asked it to "re-write its decision" regarding [*4]the forced sale of a boat so as to make his actions, which failed to comply with the decision, compliant nunc pro tunc. Coupled with these earlier incidents, the commencement of this action exhibits a "broad pattern . . . of delay, harassment and obfuscation" that warrants the imposition of sanctions and attorneys' fees. 

(Mike Frisch)

June 24, 2015 | Permalink | Comments (0)

Bad Neighbors

A suspension of twelve months has been imposed by the South Carolina Supreme Court for this incident

On January 31, 2012, respondent went to a restaurant where his son tended bar in order to drive his son home after completing his shift. While at the restaurant, respondent came into contact with a former neighbor and the neighbor's son. A verbal altercation escalated into a physical fight. The Charleston County Sheriff's Office responded. The former neighbor alleged respondent and respondent's son physically assaulted him and his son. The former neighbor refused medical treatment while his son was transported to the hospital.

The criminal charges were eventually dropped after a conviction at a trial in absentia.

The attorney had previously been suspended for six months. (Mike Frisch)

June 24, 2015 in Bar Discipline & Process | Permalink | Comments (0)

$250 Per Hour Errands

The Wisconsin Supreme Court has ordered a two-year suspension of an attorney who had "systematically overbilled" a client.

During the events giving rise to this matter, Attorney Armstrong was a licensed real estate broker doing business as ABA Realty, Inc.  She was the only broker employed by the firm.  Attorney Armstrong was licensed by the office of the Insurance Commissioner of Wisconsin to sell life, accident, and health insurance lines for several companies.

From the 1980s until October 2005, Attorney Armstrong had an attorney-client relationship with a woman we shall refer to as B.R.T.  B.R.T. was born in October 1924.  Briefly stated, Attorney Armstrong engaged in a lengthy pattern of misconduct, repeatedly overbilling her client, and ultimately, between 2000 and 2005, charging her client $170,651.95 for various tasks, many of which were not legal in nature.

The court

between September 1, 2004, and November 1, 2005, Attorney Armstrong billed B.R.T. somewhere between $58,422.32 and $62,815.20 for what was primarily nonprofessional work assisting B.R.T. with matters related to her duplex.  This work included "general contractor" type of services (such as consulting with her client about needed repairs, soliciting bids, and helping select contractors such as painters, carpenters, plumbers, and the like); property manager services (such as dunning tenants for unpaid rent, fielding complaints, keeping accounting records for rents, listing the duplex for lease, and seeking new tenants); retaining and supervising workers to clean the duplex; personally sorting and boxing the client's personal property; and running errands (such as picking up parts and supplies, boxes, plastic bags, packing tape, mulch, and the like).

Attorney Armstrong charged her client at her professional rate of $250 per hour for these services and charged her client $150 per hour for services performed by legal assistants.

The OLR alleged and the parties have stipulated that, by charging her $250 hourly rate as an attorney, and by charging her paraprofessional staff rate of $150 per hour, for the aforementioned nonprofessional work, Attorney Armstrong violated former SCR 20:1.5(a) 

The attorney stipulated to the violations. (Mike Frisch)

June 24, 2015 in Bar Discipline & Process | Permalink | Comments (0)

The Sin Of Inattention

An attorney who had allowed his personal injury practice to be run by a thieving paralegal was disbarred by the Maryland Court of Appeals

Attorney discipline cases that result in disbarment often find the attorney committing one of the seven deadly sins – e.g., greed, lust, sloth. This is not one of those cases. The sin in this case was inattention – inattention to clients, inattention to an attorney trust account, and inattention to the activities of a non-lawyer assistant in whom the attorney misplaced his trust and who misused the attorney trust account to the detriment of the attorney’s clients. Sadly, this too merits disbarment, as our regulation of the practice of law must protect the public not only from those attorneys who engage in deliberate, egregious acts of misconduct, but also those who fail to fulfill the routine duties of the profession that serve and safeguard their clients.

The court explained the nature of the duty to supervise non-lawyers

Under MLRPC 5.3(c)(2), four elements must be present to impute an employee’s misconduct to an attorney: (1) misconduct by the employee that would violate the MLRPC if done by the attorney; (2) partnership status or a direct supervisory relationship; (3) the attorney’s knowledge of the wrongdoing at a time when its consequences can be mitigated; and (4) the attorney’s failure to take reasonable remedial action.

The court noted

Ironically, on the record before us, it appears that Mr. Smith and his family members may have incurred the greatest monetary loss as a result of his misguided efforts to shore up his trust account with personal funds.

As to sanction 

Mr. Smith’s blanket delegation of authority to Ms. Staley-Jackson to communicate with clients, negotiate settlements, sign pleadings and other court papers, obtain client consent for settlements, and transmit and cash checks without adequate supervision relinquished his role and obligations under the disciplinary rules and was, at best, gross negligence. For example, when it became evident that his trust account was being invaded and payments were not being received by the appropriate payees, he was slow to investigate, to the detriment not only of his clients and the third party payees, but also of his own financial well-being as well. In attempting to make the trust account whole with family loans and out of his own pocket without conducting a thorough audit of the account, he delayed discovery of Ms. Staley-Jackson’s defalcation and effectively facilitated her final theft of funds. We need not pinpoint where along the spectrum between gross negligence and knowing misconduct he ultimately landed to conclude that his state of mind, while perhaps not evil, was not innocent...Given the volume and severity of Mr. Smith’s misconduct, including the resulting misappropriation of client funds and concealment of information from clients, the factors found in mitigation do not warrant a lesser sanction than disbarment.

The attorney is also admitted to practice in the District of Columbia. (Mike Frisch)

June 24, 2015 in Bar Discipline & Process | Permalink | Comments (0)

Tuesday, June 23, 2015

Bar Applicant Must Disclose Ongoing Criminal Activity

The Maryland Court of Appeals has published its opinion in a matter in which disbarment had been ordered the day after oral argument.

From the court's summary

Disbarment is the appropriate sanction when an applicant for admission to the bar who had secretly recorded, in intimate circumstances, female tenants who rented rooms in his house over a two-year period and whose conduct was discovered by the tenants and police shortly before his bar admission ceremony, failed to disclose that criminal conduct to the State Board of Law Examiners, the Attorney Grievance Commission, or the Court of Appeals.

The attorney was convicted of criminal offenses.

The court

A lawyer must, at a minimum, be trustworthy. One who wants to be a lawyer in Maryland must disclose to the State Board of Law Examiners (“SBLE”) and this Court information that bears on that trait. Failure to satisfy those requirements may prevent admission to the bar or, when discovered, result in disbarment.

We have disbarred the newly-admitted lawyer who is the respondent in this disciplinary proceeding and now set forth the reasons why we took that action. To explain our decision, we need not catalog precisely what past indiscretions an applicant must recall and reveal in a bar application. It suffices to say that an applicant who is engaged in ongoing criminal conduct while the application is pending must disclose it to SBLE and this Court. And it is self evident that an applicant who, as a landlord, uses hidden cameras to secretly view and record his tenants in their private bedrooms in intimate moments, without their knowledge or consent, is not trustworthy...

Mr. Van Dusen committed criminal acts that adversely reflect on his fitness to practice law. This conduct was neither an isolated nor a minor incident, but rather a serious invasion of the privacy of Ms. Malova, Ms. Prywes, Mr. Woodhams and others that extended over at least two years. Mr. Van Dusen also failed to disclose material information concerning his activities, their detection, investigation, and prosecution to SBLE and this Court. This demonstrated a serious lack of candor and truthfulness. The hearing judge also found that Mr. Van Dusen’s failure to notify SBLE and this Court regarding his surreptitious video recording of his tenants, the police investigation, the pending charges, the civil complaints, and the subsequent conviction, was deliberate and calculating.

The oral argument (at which the attorney represented himself) is linked here. (Mike Frisch)

June 23, 2015 in Bar Discipline & Process | Permalink | Comments (0)