Thursday, April 2, 2015
The Nevada Supreme Court has held a law firm not liable for estate planning work that transferred a client's assets to a trust.
The suit was brought by a creditor of the client
In this case, we consider whether, under Nevada's fraudulent transfer law, a nontransferee law firm may be held liable for its client's fraudulent transfers under the accessory liability theories of conspiracy, aiding and abetting, or concert of action. We hold that Nevada, like most other jurisdictions, does not recognize accessory liability for fraudulent transfers. We therefore affirm the district court's judgment in favor of the law firm. We further hold, however, that the district court abused its discretion by awarding costs to the law firm without sufficient evidence showing that each cost was reasonable, necessary, and actually incurred. Thus, we reverse, in part, the district court's post-judgment order awarding costs.
In 2004, Robert Krause retained respondent law firm Woods & Erickson, LLP, for estate planning services. The following year, Woods & Erickson created for Krause various legal entities, including an asset protection trust, into which Krause eventually transferred his assets. Meanwhile, appellant The Cadle Company (Cadle) was attempting to collect on a California judgment against Krause. After learning of the transferred assets, Cadle sued Krause and Woods & Erickson in the underlying action, alleging that Krause had fraudulently transferred assets in order to escape execution of the judgment and that Woods & Erickson had unlawfully facilitated the fraudulent transfers.
Plaintiff loses; law firm wins.
The case is Cadle Co. v. Woods & Erickson LLP, decided March 26, 2015. (Mike Frisch)
The New York Court of Appeals has held that St. John's University School of Law did not act arbitrarily or capriciously in revoking the admission of a law student.
This proceeding pursuant to CPLR article 78 challenges a determination of St. John's University School of Law to rescind petitioner David Powers's admission, after he had completed three semesters of law school as a part-time student, based on material misrepresentations and omissions in his application regarding his criminal history. We agree with the Appellate Division that this determination "was not arbitrary and capricious, and does not warrant judicial intervention"
The law school's treatment of Powers was rational insofar as it was not wholly inconsistent with the school's approach to rescission of admission in general. The law school states that while it routinely receives, and often grants, requests from enrolled students to amend the criminal history sections of their applications, such amendments usually involve minor offenses such as open container or traffic violations, or small quantity marijuana possession. Amendments are by no means guaranteed - -the law school states that on at least two occasions, when the information contained in the subsequent disclosure would have prevented the individual from being considered for admission, the students' admission was rescinded.
The law school avers that it has an unwritten policy of not admitting people who sell drugs and that if Powers had disclosed on his application that his arrest was for the distribution of LSD to an undercover officer and possession with intent to distribute, his application would have been denied initial screening process. The school explains that it generally distinguishes between applicants with a history of personal drug use, and those with a history of drug dealing - - the former can be accepted under certain circumstances, but the latter are not. That is not an irrational policy and certainly within the exercise of the law school's honest discretion.
Associate Judge Pigott dissented on both the "school policy" issue and sanction
David Powers has accomplished a significant amount since his (now expunged) conviction. After successfully completing an in-house drug treatment program, he graduated summa cum laude with a Bachelor of Science degree in accounting and obtained a Masters in Science degree in taxation. He is currently a certified public accountant at a well-recognized accounting firm, which hired Powers notwithstanding his prior conviction. St. John's University School of Law is apparently not as forgiving.
I respectfully dissent because, in my view, St. John's failed to demonstrate with admissible proof that Powers had been convicted of a "distribution" offense as opposed to a personal use offense (which is what Powers led the school to infer on his application), it would have denied his admission...
I also disagree with the imposition of this particular penalty -- rescission of Powers's three semesters worth of credit. Ironically, the only reason the nature of Powers's conviction was disclosed was because Powers requested a letter from St. John's in support of his application for an advanced ruling from the Appellate Division concerning whether he would be admitted to the New York bar in light of his prior conviction, thereby demonstrating his clear goal of becoming an attorney.
Given that Powers had obtained three semesters worth of credit and presumably paid tuition to attend, rescission of Powers's application is, in my view, too harsh a penalty for the alleged infraction.
Also from the California Bar Journal
GERARD BRENNAN HARVEY [#152669], 53, of Bishop, was suspended from the practice of law for 90 days and ordered to take the MPRE and comply with Rule 9.20 of the California Rules of Court. He was also placed on two years’ probation and faces a two-year suspension if he does not comply with the terms of his disciplinary probation. The order took effect Nov. 21, 2014.
In April 2013, Harvey pleaded guilty to being under the influence of and in possession of a controlled substance. The charges stemmed from an incident in March 2013, when Harvey was in court waiting for his matter to be called, and a bailiff noticed he appeared to be under the influence of a stimulant. After Harvey told him he was fine, just tired, he was allowed to finish his matter in court. However, the bailiff, afraid he might try to drive, contacted an investigator who gave him a narcotics evaluation and determined he was under the influence. A urine sample came back positive for methamphetamine and marijuana.
Harvey later admitted he lied to the bailiff when he told him he had tested clean for drugs the morning of the incident and also admitted to handling several matters in court while he was high on meth. However, the State Bar Court found that no clients were harmed as a result.
In mitigation, Harvey had no prior record of discipline and was experiencing extreme emotional and physical difficulties, including a history of substance abuse, as well as financial stress at the time of his misconduct.
From the April 2015 edition of the California Bar Journal
RETA SEDEAL CURTIS [#175248], 55, of Los Angeles, was disbarred Dec. 20, 2014 and ordered to comply with rule 9.20 of the California Rules of Court and pay restitution.
A State Bar Court judge found Curtis culpable of 11 counts of misconduct including misappropriating nearly a quarter of a million dollars and violating a bankruptcy court order.
Much of Curtis’ misconduct stemmed from a bankruptcy case she handled on behalf of a Baptist church beginning in May 2007. Curtis filed a superior court petition in violation of an automatic stay, failed to completely and accurately disclose her fee arrangements with the church and received fees and expenses as counsel for the church without first getting the bankruptcy court’s approval. She also failed to turn over the church’s financial records to the trustee, disobeyed a court order and failed to report sanctions to the State Bar.
In another matter, Curtis was hired to help a couple obtain a loan modification. Curtis did not do loan modifications but did bankruptcies and advised the couple that they should file for bankruptcy to strip away the lien on their property before they negotiated with the bank to modify the loan.
After a two-year court process that ultimately led to Curtis’ clients receiving a full Chapter 7 discharge of their unsecured debt, Curtis was successful in changing the status of their $30,000 second trust deed from a secured to an unsecured asset. She did not, however, obtain a loan modification on their behalf and the bank ended up foreclosing on the property. During the time Curtis worked for them, the couple paid her $23,249.38, money that represented their monthly mortgage payment. Most of that money was supposed to be kept by Curtis to help in negotiating the loan modification. Instead Curtis put the money into a general business account, rather than in her client trust account, and used the money for her own purposes.
In addition, Curtis failed to provide an appropriate accounting to the couple after they terminated her employment and failed to accurately and completely disclose her fee arrangements with the couple.
In a third matter, Curtis convinced a client to let her keep the client’s life savings in her client trust account, purportedly for safe keeping. Instead, she misappropriated $231,465.15 of the woman’s money. Curtis returned $80,000, but as of the date of the State Bar Court’s recommendation to disbar her she had not returned the remaining balance of $209,410.38.
Curtis received some mitigation for presenting evidence of her good character, having no previous discipline and entering into a pretrial stipulation with the State Bar.
She was ordered to pay $227,871.76 plus interest in restitution.
An attorney found to have misappropriated a portion of the proceeds of a personal injury case settlement has been disbarred by the District of Columbia Court of Appeals.
The hearing committee had rejected the attorney's story that the funds at issue had been paid in cash.
The Hearing Committee’s report, which the Board adopted, carefully explained the Hearing Committee’s reasons for discrediting Ms. Brown’s claims that she had given Mr. McGee $1650 in cash to pay Dr. Manderson and had givenMs. Gordon $1500 in cash to reflect the money owed to Dr. Randolph. With respect to Dr. Manderson, the Hearing Committee explained that Ms. Brown’s claim was uncorroborated by any records; that Ms. Brown had told Dr. Manderson’s office that she had paid the bill and that she would provide a copy of a cancelled check; that Ms. Brown never provided such a copy; that when Ms. Brown initially responded to Bar Counsel, she did not mention Mr. McGee but rather inaccurately claimed that Dr. Manderson’s office did not send a final bill until February 2010; that Mr. McGee had not appeared at the hearing and thus could not be cross-examined about the contents of the proffered affidavit; that Dr. Manderson’s office had made repeated efforts to obtain payment; and that Ms. Brown failed to respond or to pay the bill until after Ms. Gordon complained to Bar Counsel.
With respect to Dr. Randolph, the Hearing Committee explained that Ms. Gordon testified that Ms. Brown had never given Ms. Gordon $1500 in cash to reflect the money owed to Dr. Randolph; that Ms. Brown had no records to corroborate her claim; and that Ms. Brown had made statements both to Ms. Gordon and to Bar Counsel indicating that in fact Ms. Brown had not given Ms. Gordon the money owed to Dr. Randolph.
The court also rejected the contention that disbarment was too harsh a sanction uner the circumstances.
In arguing against disbarment, Ms. Brown relies on the following mitigating circumstances: she had no prior disciplinary record; at the time she responded to the disciplinary complaint, she was confronting difficult circumstances, including a high-risk pregnancy and marital problems; she admitted that she had made mistakes; her client was not financially harmed; she ultimately paid the doctors’ bills; and witnesses testified to her good character and community involvement. We agree with the Board that these circumstances are not so extraordinary as to justify a departure from the presumptive sanction of disbarment, particularly given the aggravating circumstance that Ms. Brown showed disregard for the truth both in her testimony at the hearing and in her statements to Ms. Gordon, to Dr. Manderson’s office, and to Bar Counsel
A 90-day suspension with fitness was imposed by the District of Columbia Court of Appeals for an unauthorized communication with a represented party and dishonesty
the Board on Professional Responsibility (“Board”) recommended that respondent be suspended for a period of ninety days, and be required to prove his fitness to practice law as a condition of reinstatement. The Board found that respondent surreptitiously and repeatedly met with another person, known to be represented by another lawyer in the matter, without that other lawyer’s consent. The Board also found that “[r]espondent’s dishonesty was manifest, because he deliberately and systematically took advantage of a vulnerable, [eighty-nine]-year old blind woman, whose condition he himself assessed as ‘feeble-minded in the extreme.’”
Additional details of this sorry tale of elder abuse can be found in this court decision in In re Sally Jumper. (Mike Frisch)
Wednesday, April 1, 2015
The Connecticut Supreme Court affirmed the Appellate Court's grant of a new trial to a defendant convicted of "one of the most brutal crimes" in state history for Brady and ineffective assistance violations
The petitioner was forty-two years old when he allegedly committed one of the most brutal crimes in our state’s history—the rape, torture and murder of a defenseless eighty-eight year old woman, a person who, by all accounts, was like a grandmother to him. Although there is abundant evidence in the record concerning the petitioner’s simplemindedness, his peculiarities and his very rigid way of thinking, one searches the record in vain for evidence that he ever was physically violent, that he suffered from a mood disorder, psychosis, drug addiction or anything else that could explain why, after visiting the victim every Sunday for years, he suddenly went back to her apartment on the Sunday in question and brutally murdered her, without his wife noticing either that he had left their house or any change in his demeanor or appearance upon his return. Furthermore, at the petitioner’s criminal trial, the state was not required to commit to any particular time frame for the murder, arguing only that it occurred sometime between 5:45 p.m., when the victim was last seen alive by Howard, her daughter, and 8:05 p.m., when she failed to answer Howard’s telephone calls. If, however, the original jury were to have heard and credited DeHaan’s and Kelder’s testimony that the fire was set between 7:30 and 8:05 p.m., and if that jury also were to have heard and credited Martin’s testimony that the petitioner was at home with her watching television at that time, there is not just a reasonable probability of a different result, there is a near certainty of one. And, as we have explained, there simply is no reason why the jury reasonably could not have credited that testimony. The petitioner therefore has established, under Strickland, that his first habeas counsel’s representation of him was constitutionally deficient due to counsel’s failure to pursue a Brady claim founded on the state’s suppression of the Ludlow note because that nondisclosure deprived the petitioner of evidence establishing a complete and potentially compelling alibi, thereby gravely undermining the reliability of the verdict against him. Because the record demonstrates convincingly that the petitioner is burdened by an unreliable conviction, he is entitled to a new criminal trial.
The Ohio Supreme Court has publicly reprimanded a judge for a drunk driving conviction
On January 12, 2013, Marshall was involved in a one-car accident in which he struck an embankment and flipped his vehicle. He was later arrested and charged with operating a motor vehicle while intoxicated. On March 8, 2013, he pleaded guilty to the charge and was sentenced to those days suspended. He was placed on nonsupervised probation for up to 60 months and ordered to pay a $550 fine plus court costs. The parties stipulated that Marshall’s conduct violated Jud.Cond.R. 1.1and 1.2, and relator agreed to dismiss the alleged violation of Prof.Cond.R. 8.4(h).
The court noted steps taken by the judge to address his alcoholism. (Mike Frisch)
A convicted attorney was disbarred by the New York Appellate Division for the Fourth Judicial department.
Syracuse.com had some background from January 2015
A Liverpool lawyer and Realtor could plead guilty today to charges relating to a Central New York drug ring.
Thomas Ehle, 60, of 314 Saltmakers Road, was indicted in October on felony drug possession and conspiracy charges stemming from a ring that authorities say operated in Syracuse and Utica in the first half of 2014.
Assistant District Attorney Shaun Chase declined to discuss the proposed plea, noting that Ehle had not yet admitted to any crime. But a court calendar indicated that Ehle was due before County Court Judge Thomas J. Miller for a possible disposition to his case.
Ehle is a 1983 graduate of Syracuse University's law school who later became a real estate agent and owns Hanover Square Realty LLC.
Ehle was among at least 10 people arrested as part of the ring, which Chase said dealt in cocaine. One of the others arrested on a conspiracy charge, Matthew Kendall, was the manager of a popular Syracuse restaurant. His case is still pending.
Disbarment is mandatory for a felony conviction under the laws of New York. (Mike Frisch)
Tuesday, March 31, 2015
An Illinois Hearing Board has recommended that a petition for reinstatement to practice be denied.
The attorney's first ethics violation involved her failure to disclose her client's death during settlement negotiations of a workers' compensation claim.
The sanction was a censure.
The second matter
involved Petitioner's conduct in October 2002 at O'Hare Airport. Petitioner, while intoxicated, got into an altercation with her boyfriend who was trying to prevent her from driving while intoxicated. The Hearing Board in that matter credited a police officer's testimony that he had observed Petitioner strike her boyfriend.
Petitioner also physically attacked and used racial and vulgar epithets towards multiple police officers who responded to the disturbance. The Hearing Board determined Petitioner engaged in the criminal act of battery and disorderly conduct when she physically attacked the police officers.
This matter drew a stayed 30-month suspension with probation. Continued drinking resulted in probation revocation.
Although we recognize Petitioner's sobriety date marked a significant change in her life, we still believe it necessary to consider Petitioner's outrageous behavior that occurred since discipline was imposed but prior to sobriety. This conduct demonstrates what behavior Petitioner is capable of engaging in if she continues to disregard the treatment recommendations of Dr. Jeckel and Dr. Bohlen and again abuses drugs and alcohol.
Since being disciplined and while under the influence of drugs and alcohol, Petitioner continually exercised poor judgment and decision-making that often demonstrated disrespect for the law. She engaged in a pattern of violating conditions of probation and supervision, which resulted in her probation in her second disciplinary case and her supervision in her criminal domestic battery case being revoked. She also regularly demonstrated a disrespect for and a failure to cooperate with law enforcement as evidenced by the March 2007 domestic battery incident and March 2008 forged check incident, as well as her failure to cooperate with the police when questioned about her vehicle that had been used in an armed robbery in December 2011. Moreover, Petitioner regularly lent her car to drug dealers to support her drug addiction. She also acted suspiciously by leaving the Currency Exchange without her identification after being informed that the check she was attempting to negotiate had been forged and the police had been called.
During this time period, Petitioner also demonstrated a disregard of the obligations of the legal profession. Petitioner failed to timely comply with her obligations under Supreme Court Rules 764 and 780. She also failed to return unearned fees to her clients and failed to respond to the Client Protection Program's requests for information regarding her client matters. Petitioner also disregarded the Kohl's attendance policy that she was apprised of on a number of occasions and was discharged for exceeding the number of allowable absences
Not only are we concerned with Petitioner's conduct before sobriety because it demonstrates the conduct she is capable of engaging in if untreated, but we find her current attitude towards this conduct extremely troubling. Petitioner, despite now being sober and claiming to have recognized the severity of her alcoholism and drug abuse, demonstrated an unwillingness or inability to take responsibility for her past conduct. Instead, she continually tried to defend and minimize her conduct. In addition, she failed to demonstrate sincere regret for her past behavior that resulted in harm to herself, law enforcement, and members of the community. Petitioner's attitude towards this conduct significantly weighs against reinstatement.
The board further opined that reinstatement should be conditioned on her compliance with treatment recommendations. (Mike Frisch)
The Charlotte Observer has picked up on the stories that we ran concerning the North Carolina State Bar prosecution of two death penalty defense attorneys.
Two defense attorneys face accusations of professional misconduct for a piece of their work on the first successful challenge under the Racial Justice Act.
Gretchen Engel, director of the Durham-based Center for Death Penalty Litigation, and Cassandra Stubbs, a lawyer with the American Civil Liberties Union Capital Punishment Project, were among a team of attorneys who used the short-lived law to convert a North Carolina death row inmate’s sentence in 2012 to life without possibility for parole.
Now the attorneys face possible punishment from the N.C. State Bar.
Some legal analysts have characterized the allegations of wrongdoing as so minor and “questionable” that they think politics could be at play.
At issue is whether Engel and Stubbs violated professional codes of conduct in relaying information to the courts after interviewing two African-American men excluded from serving on the 1994 jury that decided the fate of Marcus Reymond Robinson.
Robinson, an African-American male, was sentenced to death almost two decades ago for the 1991 killing of Erik Tornblum, a white teenager.
In April 2012, Judge Gregory Weeks issued a landmark ruling in Cumberland County Superior Court saying prosecutors across the state had engaged in deliberate and systematic racial discrimination when striking black potential jurors in death penalty cases.
Under the Racial Justice Act, Weeks was able to reduce the death sentence for Robinson to life in prison with no possibility for parole.
Prosecutors have disputed those statistics and immediately banded together not only to appeal the Weeks ruling but to orchestrate the overturning of the unique North Carolina law that allowed inmates to use statistics to bolster claims of racial bias.
Engel and Stubbs recently found out that someone filed complaints against them with the State Bar, the organization that oversees North Carolina lawyers.
The bar allegations focus on sworn statements the attorneys introduced from the men who had been part of the 1994 jury pool but not selected for the panel.
The bar complaint contends the lawyers included inaccurate information for the court to consider that ranged from a wrong address to a recollection from one of the potential jurors that did not jibe with the official trial transcript.
“He noted that the affidavits were not introduced for substantive purposes, and the purpose for which they were introduced was not even in dispute,” Bannon and Schneider, the attorneys for Stubbs, said in a joint statement. “He gave them no weight, and he did not rely on them in 378 pages of orders explaining his rulings.”
The Racial Justice Act proceedings for Robinson extended over 20 days of testimony. Eighteen witnesses testified, and more than 298 exhibits were included in the record.
“Weeks also made another important finding,” Bannon and Schneider said in a statement echoed by Tyndall, the attorney for Engel. “[I]f there were any inaccuracies in the two affidavits, they were not the product of intentional misconduct, willfulness or bad faith.”
Engel and Stubbs plan to ask for hearings before the State Bar to fight the complaints.
Legal scholars and analysts with no ties to the cases of Racial Justice Act proceedings questioned whether the high-profile nature of the Robinson case might be playing a part in the misconduct allegations.
“The State Bar does not explain publicly why it chooses to proceed on some complaints from the public and not on others, so we have to guess,” said Bernie Burk, a UNC-Chapel Hill law professor with expertise in ethics and professional responsibility. “The Racial Justice Act case at issue is very high-profile and extremely controversial, with many people holding strong views on both sides. And the complaints suggest that the people who accused the defense lawyers believe that the discrepancies they’ve identified were, in the words of the ethical rules, ‘prejudicial to the administration of justice.’
“Given the high profile and intensity of the controversy and the gravity of what the accusers claim, the Bar may have felt that the best course is to hold a formal proceeding that will result in an evidentiary record and a reasoned decision, so that everyone will understand the reasons for the result.”
Michael Frisch, a Georgetown University law professor who worked for 18 years as a bar prosecutor for the District of Columbia, wrote about the two cases on a blog he started to offer insight into such proceedings.
“I look at this prosecution, and I see the charges looking very questionable to me,” Frisch said in a telephone interview Friday. “I wouldn’t see them prosecuting this if it was Joe Schmo on the street or a prosecutor. And as a result, this is leading me to believe this is a politically motivated prosecution.”
The Oklahoma Supreme Court accepted the resignation of an attorney who had abused the trust of an elderly client.
The title is a reference to the last two quoted paragraphs.
The court told the story
In 2005, Respondent began assisting his law firm's client, Elizabeth Stambaugh, with a guardianship of her disabled daughter and husband of 60 years, who was suffering from advanced Parkinson's disease and Alzheimers. At that time, Respondent was 34 years old and Stambaugh was 83 years old. Stambaugh's husband died in November 2005, leaving Stambaugh with considerable assets and as the sole trustee of a revocable trust, with full authority to distribute its assets.
Respondent developed a personal relationship with Stambaugh which went far beyond the professional bounds of an attorney-client relationship. Respondent advised Stambaugh that he owed his adoptive father who was gravely ill a large sum of money to repay his undergraduate education. On April 20, 2006, Stambaugh wrote Respondent a check for $160,000 for him to repay his adoptive father, and Respondent accepted the $160,000 gift from his client. Later that year, Respondent told Stambaugh he could not spend more time with her because he had to work to pay his home mortgage. On September 5, 2006, Stambaugh transferred $153,838.42 to pay off the balance of Respondent's mortgage, and Respondent accepted the gift.
In January 2007, Respondent opened his own practice and took Stambaugh as a client to his new law firm. Respondent represented Stambaugh on multiple matters, and Stambaugh paid Respondent's invoices and additional retainer fees. In addition to the legal fees, in 2007, Respondent accepted over $12,000 in gifts for himself and $36,000 in gifts for his three children from Stambaugh. In October 2006, Respondent advised Stambaugh regarding the amendment or restatement of her will and trust. In the Third Restatement of Stambaugh's trust, Respondent was named as the beneficiary of the balance or residue of the trust estate. Respondent billed Stambaugh for preparing the new estate planning documents, and for the phone conversation and meetings with Fred Stoops, the lawyer Respondent arranged for Stambaugh to hire to finalize the amended estate planning documents.
In 2008, in addition to legal fees Respondent collected from Stambaugh, Respondent accepted over $12,000 in gifts for himself and $36,000 for his children. In March 2008, Stambaugh amended her trust and made Respondent a 40% beneficiary of the trust estate. Respondent told Stambuagh he could not devote more time to her because he needed to work to repay his student loans. On September 26, 2008, Stambaugh transferred $98,447.38 to pay off the balance of Respondent's student loans, and Respondent accepted this gift. Also, on September 29, 2008, Stambaugh wrote a check for $53,477.50 to pay off the balance on Respondent's vehicle, and Respondent accepted this gift. In November 2008, Stambaugh amended her trust to remove Respondent as a beneficiary.
Respondent informed Stambaugh that his neighbors had stolen several items from his garage. On March 12, 2009, Stambaugh transferred $579,000 to the Jasen R. Corns Revocable Living Trust for the purchase of a residence for Respondent, and Respondent accepted the gift. In July 2009, Respondent advised Stambaugh regarding the amendment of her trust in order to again make him a beneficiary. On August 12, 2009, Stambaugh amended her trust and made Respondent a 40% beneficiary, and on November 13, 2009, Stambaugh amended her trust and removed Respondent as a beneficiary. On November 18, 2009, Stambaugh paid taxes on Respondent's new home in the amount of $6,300, and Respondent accepted the gift. In 2009, Respondent also accepted over $12,000 in gifts for himself and $36,000 for his children.
In 2010, in addition to legal fees collected by Respondent from Stambaugh, Responded accepted over $12,000 in gifts for himself and $36,000 for his children. In February 2010, Respondent again advised Stambaugh regarding amending her trust to add Respondent as a beneficiary. On February 11, 2010, Stambaugh restated her trust and named the trustee of the Jasen Corns Trust as a 40% beneficiary of the trust estate. On March 10, 2010, Stambaugh amended her trust and designated Respondent and the Trustee of the Jasen Corns Trust as 40% beneficiaries of the trust estate. The amendment also allowed discretionary distributions to be made in any amount for Respondent's health, legal, or emergency needs and to support Respondent in the manner of living to which he is accustomed. These changes reflected handwritten notes Respondent had prepared and given to Stambaugh prior to amendment. On August 9, 2010, Respondent was removed as beneficiary of Stambaugh's trust.
In September 2010, Stambaugh sued Respondent for abuse of his role as a fiduciary and for undue influence to obtain gifts. After the filing of the lawsuit, Respondent sent an email to multiple individuals regarding an article the Tulsa World was going to publish concerning the relationship between Stambaugh and Respondent, and the pending lawsuit. In the email, Respondent stated he thought Stambaugh now had dementia, and that he had previously cut ties with her due to her inappropriate behavior, but that the two had reconciled as she agreed to stay away from his family and he wanted the annual payments/gifting.
During the lawsuit, Respondent communicated with Stambaugh regarding actions she needed to take to dismiss her lawsuit, despite the fact she was represented by counsel. Respondent's communications included cards with affectionate overtones and requests for forgiveness. On February 16, 2011, after Respondent met with Stambaugh alone without permission of her attorney, Stambaugh instructed her attorneys to dismiss her lawsuit against Respondent. On February 23, 2011, Respondent hand-delivered a letter to Stambaugh informing her she may employ him as an attorney. On February 25, 2011, by contract prepared by Stambaugh, Stambaugh re-engaged Respondent for general matters and assistance and to reserve Respondent's time as Stambaugh desired. The contract stated Stambaugh would not seek legal advice through Respondent alone.
In July 2011, pursuant to a settlement agreement to dismiss a pending guardianship proceeding brought by Stambaugh's family members, Stambaugh created an irrevocable trust prohibiting Respondent from receiving any distributions from Stambaugh's trust. However, in August and September 2011, Stambaugh wrote checks to Respondent for $2,000, $1,641, and $4,000. In addition, in September 2011, Respondent took Stambaugh to a dealership where she purchased a vehicle for $27,274. Respondent and members of his family then possessed and used this vehicle exclusively until the co-trustee's of Stambaugh's trust demanded its return to Stambaugh. Respondent later returned the vehicle to Stambaugh.
On September 19, 2011, a co-trustee demanded Respondent return monies Stambaugh distributed to him between April 2011 and September 2011 and take nothing further. In November 2011, Respondent emailed Stambaugh's employees stating he believed Stambaugh was heading down a path that would lead her to being deemed incompetent and subject to guardianship. Respondent continued to discuss estate planning matters with Stambaugh. Writings memorializing these conversations show Respondent advised Stambaugh to name him as a beneficiary to her trust. Respondent also recommended new attorneys and asset managers to make changes and challenge the trust.
While at Stambaugh's home In March 2012, Respondent bought tickets to the Ryder Cup in the amount of $3,096.52 on Stambaugh's credit card. When the co-trustee of Stambaugh's trust discovered the purchase, she cancelled it. Then, in May 2012, Respondent used Stambaugh's credit card to pay $3,750 to Federal Tax Relief for services rendered to Respondent, and Respondent identified Stambaugh as his "mother" when using her credit card information.
During the course of the relationship, Stambaugh purchased numerous trips for them with the belief Respondent would accompany her, but before the departure date of each trip, Respondent would cancel. During the course of the relationship, Respondent knew Stambaugh was romantically interested in him and he took advantage of her affections and abused his position of trust as her attorney to unduly influence her to gift him in excess of one million dollars.
Resignation is too gentle a fate for this type of abuse of the law license. (Mike Frisch)
Herbert M. Kritzer (U. Minn., Law) has published a new volume Lawyers at Work, collecting and updating his 35 years of empirical and theoretical study of attorneys in action, including daily office work, use of expert witnesses, contingency fees, "professionalism," sanctions, and international comparisons. He's known as one of the most insightful and sustained researchers in law and political science on the legal occupation and professional literature. The book is published as part of my Quid Pro Books project and is found as such places as Amazon and Barnes & Noble, in print (hardcover and paperback) and ebooks. (Alan Childress)
Monday, March 30, 2015
Summary reinstatement was recently ordered by the District of Columbia Court of Appeals in the case of a former Holland & Knight partner suspended in 2011
On consideration of Bar Counsel’s report regarding petitioner’s petition for reinstatement wherein Bar Counsel informs the court that Mr. Silva has demonstrated that he is fit to resume the practice of law subject to certain conditions, the petition for reinstatement, and it appearing that petitioner is eligible to file the petition for reinstatement, see In re Silva, 29 A.3d 924 (D.C. 2011), and it further appearing that Mr. Silva has agreed that his reinstatement be conditioned on his continued attendance at support group meetings and counseling for a period of five years and that he consent to his counselor submitting compliance or non-compliance reports to Bar Counsel and the Board on Professional Responsibility every six months...
Our earlier coverage
The attorney had joined a prominent law firm in 1994 and was made partner in 1995. His practice involved real estate. A firm client retained him to negotiate and prepare an easement relocation agreement between the client and adjacent land owners and others. The attorney started but never completed the work. Rather, he gave the client a forged and falsely notarized document and assured the client (also falsely) that it had been recorded. As a result, the client proceeded to a closing and entered into a construction contract. The attorney falsely advised that he had provided notice to interested parties.
The attorney for an adjacent landowner learned of the construction project and complained to the client. The client could not reach the attorney but contacted another firm partner, who confronted him. The attorney "admitted his actions and attributed them to stress, his use of cocaine and drinking." The problem was cured "at a substantial cost to the law firm." The client did not suffer material injury.
The firm immediately suspended the attorney and later terminated him. The attorney was advised that the firm would report him to Bar Counsel if he did not self-report. When he did not do so, the firm reported him. He responded to the bar complaint and "[m]ost of what he told Bar Counsel was false." He lied about his ongoing cocaine abuse and treatment. He had dropped out of a treatment program by falsely claiming that his father had died. He postponed a meeting with Bar Counsel by falsely claiming that his fictitious nephew had been killed in a traffic accident.
The original suspension was for three years with a fitness requirement. Bar Counsel here conceded present fitness, which allowed the matter to proceed without a full hearing and review by the Board on Professional Responsibility. (Mike Frisch)
The New Jersey Appellate Division has held that a corporation convicted at trial and declared indigent by the trial judge is not entitled to a public defender on appeal at public expense.
Western World, Inc. was indicted for crimes arising from a shooting during a reenactment of a gunfight at Wild West City. The corporation was represented at trial by private counsel, who negotiated a plea deal.
The plea deal preserved an appeal issue.
The Office of the Public Defender noted the appeal but sought to be relieved, citing its limited resources.
The defendant had opposed the motion.
The court did reaffirm a corporation's right to be represented by counsel under federal and New Jersey law. (Mike Frisch)
An attorney who allowed a civil claim to be dismissed and fabricated a settlement with the client should be suspended for 30 days, according to a recent report of the Illinois Review Board.
This matter arises out of the Administrator's one count complaint charging Respondent with misconduct in handling a personal injury case. After the Respondent neglected a lawsuit filed by him in DuPage County, the court dismissed the case. Respondent failed to refile the case and misrepresented the status of the case to the client. He later fabricated a settlement without disclosing to the client that the matter had been dismissed. He told the client he would negotiate a bill from a medical provider and then neglected to do so. After the client complained, he paid the medical bill, but did not disclose to the client his misconduct.
The attorney sought a censure but
The Hearing Board...concluded that a thirty day suspension was warranted given the aggravating factors in this matter. The Hearing Board found that the misconduct caused harm and potential harm to the client. After Respondent first neglected the lawsuit and failed to refile it, he then neglected to pay the final medical provider, thus creating a situation where the doctor sought payment from the client personally. In addition, the Hearing Board was particularly troubled by Respondent's repeated efforts to conceal his neglect and his failure to ever admit his errors to his client. As noted by the Hearing Board, Respondent's misconduct was not detected until he failed to pay the final medical provider. Even then, Respondent failed to tell the client about his errors and he continued to engage in deceit. This conduct in particular illustrated to the Hearing Board the need to deter similar misconduct by other attorneys.
Friday, March 27, 2015
The Louisiana Supreme Court conditionally admitted a bar applicant subject to compliance with conditions imposed by the Lawyer Assistance Program (LAP).
Justice Clark dissented
By granting conditional admission to this applicant, this Court has once again lowered the standards demanded of members of the Bar.
The applicant has a long history of committing serious felony drug offenses. Applicant also stole a large sum of money from his parents.
Based on these facts, I do not believe he can be entrusted with client funds, and that his conduct creates a direct threat to the public. I do not believe the applicant has demonstrated that he possesses the moral character required for admission to the bar. The applicant has engaged in a pattern of conduct which is fundamentally inconsistent with a lawyer’s duties of truth and honesty and shows he lacks the moral fitness for admission to the bar.
As we have previously noted, these conditional admission cases in Louisiana provide a dearth of information about the identity of the applicant and the particulars of the case. (Mike Frisch)
The Iowa Supreme Court has suspended the former Madison County Attorney for having sex with and then beating up a client.
The attorney will not be eligible to seek reinstatement for eighteen months.
The Grievance Commission had proposed a four-year suspension.
The court on sanction
We agree with the commission that a substantial sanction is warranted for Blessum’s criminal act victimizing his own client. ... The photographs showing Doe’s injuries are also quite troubling. Doe was fortunate the police arrived when they did. Blessum’s efforts to downplay his actions before the commission, indicating he basically struck Doe only to knock the pills out of her hand and prevent her from committing suicide, fall short of the standards we expect of attorneys...It is also disappointing that Blessum appeared to play on Doe’s emotions to dissuade her from pressing charges against him after the assault and even instructed her on how to call the courthouse and have the charges dropped. In sum, the totality of Blessum’s behavior shows considerable disrespect for the law and the legal system.
The Des Moines Register had this extensive account of the disciplinary proceedings from June 2014
A former Iowa prosecutor who had sex with a client and then physically beat her should be barred from practicing law for at least four years, according to a state commission that oversees lawyers.
In a strongly worded written recommendation, the Grievance Commission of the Supreme Court of Iowa has denounced former Madison County prosecutor Anthony Zane Blessum, 56, for his lack of remorse and said his actions "typify the domestic-assault defendants he used to prosecute."
The commission found that Blessum neglected his duties on behalf of a client; that he had sex with the client; that he committed a crime that reflects adversely on him as a lawyer; and that he used fees paid by the client before those fees were earned. The commission is recommending that the Supreme Court suspend Blessum's law license indefinitely, with no possibility of reinstatement for four years.
Blessum's attorney, Kent Gummert, said his client is disappointed in the commission's findings, but looks forward to the Supreme Court's review of the case.
"Mr. Blessum is a good man, and the issues addressed in this matter reflect an aberration in an otherwise stellar legal career," Gummert said.
In November 2012, The Des Moines Register wrote a Page One report about the incident between Blessum and his client and the fact that charges had not been filed. Charges were filed two months later.
Blessum was hired to handle divorce
Court records indicate that in October 2008 Melissa Stender, now 46, hired Blessum to represent her in a divorce from her husband. Blessum agreed to take the case, although he had previously represented Stender's husband in other legal matters.
Blessum charged Stender a flat fee of $1,000, which he deposited into a trust account. Eight days later, before doing any work on the case, Blessum withdrew the entire $1,000, according to the commission.
In early 2009, as part of the divorce settlement, Blessum agreed in writing to secure for Stender $110,000 from her husband's retirement plan. But it wasn't until August 2011 that Blessum filed the necessary paperwork to secure the $110,000, the commission found.
In March 2011, Stender visited Blessum's office to consult on her will. According to the commission, Stender and Blessum acknowledge that they began an intimate, sexual relationship within hours of that visit.
On the night of June 11, 2012, Waukee police received a 911 call from Blessum's house. Police records show that on the tape of the call, a woman could be heard crying and saying, "Please, let me go. ... I beg you to let me go."
A man could be heard on the tape saying, "Get out, get out of here," "You bit one of my fingers" and "I didn't want to hurt you."
When officers arrived, Blessum said Stender had broken into his house and swung a frying pan at him. He told officers that the two had quarreled and that the confrontation had become physical when she attempted to take some prescribed medication because of an oncoming panic attack.
According to the officers' report, Blessum told police he was a married man going through a midlife crisis. Stender was treated at a local hospital for numerous injuries, including a black eye, a lacerated lip, bruised hips and scratches on her neck, arms and legs.
Initially, officer files no charges in case
Officer Derrick Spoerry's police report detailed how he determined that no charges would be filed against either Blessum or Stender.
"I spoke with on-call (Assistant) County Attorney Chuck Sinnard and explained the situation to him," Spoerry wrote in the police report. "I advised him of all the details. Chuck advised to not make an arrest at this point and to write up the case and he will review it and decide on charges."
After the Register's report, Blessum was initially charged on Jan. 14, 2013, with misdemeanor assault causing injury and assault with intent to commit sexual abuse. As part of a plea agreement with the Iowa attorney general's office, the latter charge was dismissed, and Blessum was given a one-year suspended jail sentence, with probation, after pleading guilty of assault causing injury. He was also sentenced to seven days in jail with credit for one day already served, and he was ordered to pay $6,988 in victim restitution.
Five months after Blessum's sentencing, the Iowa Supreme Court Attorney Disciplinary Board filed a complaint against him, alleging misconduct. Four months ago, a hearing was held before the Grievance Commission. Last week, the commission issued its disciplinary recommendations to the court.
Commission cites his lack of remorse
The commission was dismissive of Blessum's argument that Stender was partly to blame for the actions that led to his conviction and the disciplinary board's complaint, stating that Blessum "chose to repeatedly assault" Stender.
"The facts speak for themselves, as do the photographs of (Stender's) injuries," the panel said.
At the hearing, Blessum defended himself by citing his service as the Madison County attorney from 1987 through 1997. The commission, however, said Blessum's actions belied his experience as the county's top law enforcement officer.
"After sending (Stender) to the hospital, he continued to contact her in a romantic fashion," the commission said in its recommendation to the court. "The fact that he had not been arrested, and that a no-contact order was not in place, did not provide a basis for his post-assault behavior. His actions during and after the assault more accurately typify the domestic-assault defendants he used to prosecute. This panel finds that his experience as a prosecutor is a particularly troubling, aggravating circumstance."
The commission cited Blessum's "consistent lack of remorse for his conduct," and said it was particularly disturbed by his "cavalier attitude" toward the ethics charges against him.
The commission recommends that before Blessum be allowed to apply for reinstatement of his law license, he undergo a mental health evaluation that includes anger-management treatment.
The Supreme Court's decisions on discipline typically are made several months after the Grievance Commission makes its recommendations.
The court also found a trust account violation. (Mike Frisch)
The Maryland Court of Appeals has issued an opinion summarized in this headnote
Court of Appeals disbarred lawyer who, among other things, engaged in sending sexually explicit text messages and informed woman that “sugar daddy” would pay her to watch her masturbate, and who previously had been disciplined on two occasions for engaging in misconduct. Such conduct violated Maryland Lawyers’ Rule of Professional Conduct (“MLRPC”) 8.4(d) (Conduct that is Prejudicial to the Administration of Justice).
The unsavory details
Jeffrey S. Marcalus (“Marcalus”), Respondent, a member of the Bar of Maryland, texted Lindsay Dudley (“Dudley”)—a self-represented party in litigation in which Marcalus represented the opposing party—to, among other things, request a photograph of Dudley in a bathing suit; discuss whether Dudley would be willing to use “toys” with a “sugar daddy”; and state that he “usually wake[s] up with” an erection. After Dudley engaged counsel, her attorney filed a complaint against Marcalus with the Attorney Grievance Commission (“the Commission”), Petitioner.
"It was a joke" did not work as a defense
We are beyond satisfied that, even if Marcalus and Dudley engaged in consensual conduct and believed that their statements to each other were a “joke,” given that Dudley was a self-represented party in litigation in which Marcalus represented the opposing party, Marcalus’s “sexting” and suggestive conduct would negatively impact the perception of the legal profession of “a reasonable member of the public[.]”
The court noted that the attorney had been disciplined on two prior occasions
The only mitigating factor (remorse) falls woefully short of warranting a lesser sanction. Marcalus’s remorse is too little, too late. Marcalus should have realized that his misconduct was wrongful before, not after, he engaged in it for the third time. Plainly put, in this instance, “three strikes and you’re out.”
Thursday, March 26, 2015
An interim suspension has been imposed by the New York Appellate Division for the First Judicial Department for failure to respond to a bar complaint
The Committee opened an investigation into respondent's conduct after receiving a letter dated November 6, 2013, from the Director of Clinical Legal Education at Cardozo Law School, about respondent, who had been an adjunct clinical professor for the Labor and Employment Clinic at the Law School until August 2013. The letter explained that respondent was responsible for supervising students who represent clients at administrative hearings for unemployment benefits, with respondent as the attorney of record. In January 2013, respondent was informed that Cardozo had decided not to continue with the Labor and Employment Clinic after May 2013. The letter further explained that respondent promised that the cases would either be completed or transferred to other counsel before the end of the spring semester. Notwithstanding several requests, respondent did not provide a list of uncompleted cases or any other information about his clients. Under the circumstances, the Director concluded that "[i]t appears a number of cases were simply abandoned" by respondent. The Director of Clinical Education believed that respondent's conduct was likely the result of a "psychiatric disability that is interfering with his ability to practice law."
Beginning on March 25, 2014, the Committee wrote respondent, at his home and business addresses, a letter summarizing the information the Director of Clinical Legal Education at Cardozo provided the Committee and asking him to submit an answer addressing, inter alia, the situation that led to his conduct with regard to the cases he had been handling concomitantly with the Cardozo clinic. A follow-up letter was sent on May 7, 2014, to respondent's home address by certified mail return receipt requested. On May 21, 2014, the Committee received the certified mail return receipt signed by someone, indicating delivery to respondent's home address. Nonetheless, respondent did not submit an answer. A third letter was sent to respondent on June 12, 2004, warning him that his continued neglect of the matter could expose him to disciplinary charges and/or suspension. When no answer was forthcoming, the Committee sent a fourth letter dated August 12, 2014, that included a judicial subpoena seeking his personal appearance on August 26, 2014. Respondent failed to appear on that date. A Committee investigator then checked DMV records, which showed that a New York driver's license was mailed to respondent's home address, and that on September 10, 2014, respondent participated in an accident prevention course.
Finally, the Committee also made several attempts to personally serve respondent at his home address. On December 22, 2014, a Committee investigator went to the apartment building where respondent resided. The investigator rang the outside buzzer numerous times with no answer. The investigator then performed a Google search on the spot and obtained respondent's phone number. When the investigator called the number, respondent acknowledged it was he on the other end of the phone. When the investigator told respondent that he was outside respondent's residence to serve him with official court papers and asked him to confirm his address, respondent said he would call him back and hung up. When the investigator called back, there was no answer. On December 26, 2014, the Committee investigator went again to respondent's residence and rang the outside bell numerous times with no answer. The residential building's superintendent opened the ground door and acknowledged to the investigator that he knew that respondent was a tenant of the building. The investigator knocked on respondent's apartment's front door. When no one answered, the investigator taped a copy of the interim suspension motion to the apartment's front door. Upon his return to the office, the investigator mailed two copies of the motion to respondent, by first-class mail and certified mail return receipt requested.
Despite the foregoing efforts, the Committee reports that respondent has failed to respond to the complaint against him or contact the Committee in response to the many letters sent to him. In light of respondent's failure to communicate with the Committee, the Committee concluded that respondent has intentionally made himself inaccessible to those to whom he is accountable. The Committee thus seeks respondent's suspension from the practice of law until further order of the Court due to his failure to cooperate with the Committee in its investigation.
In New York, disbarment is imposed if the attorney persists in the non -cooperation for six months. (Mike Frisch)