Legal Profession Blog

New Jersey Rejects Trump Mitigation Argument

An attorney's disbarment in the United States District Court for the Eastern District of New York led to reciprocal disbarment in New Jersey.

The attorney settled an employment discrimination case for her client and received an $85,000 settlement check. She deposited the check in an account with a balance of 60 cents.

The attorney then spent the account back down to 60 cents before going into negative balance. The client got not a penny.

She contended that the client's share of $55,000 was not at risk

Rather, she maintained that she had "set aside for Ms. Edkins a portion of [respondent’s] collection of gold and silver coins which she stores in a coin box at a relative’s home in Pennsylvania," and that the portion was worth $55,500 - the amount of Edkins’ portion of the settlement proceeds. Respondent provided no evidence of either the existence or the value of the coins.

According to the Disciplinary Review Board's report, she offered this thought in mitigation of sanction

other New Jersey attorneys and judges had been given second chances, despite egregious misconduct; and that "Donald Trump was permitted to run for office in spite of his being investigated for treason [and] several claims of sexual misconduct."

 Nor was this helpful

Respondent also noted that she had settled cases for more money than she had received in behalf of Edkins, and did not steal those funds. Notably, respondent did not argue that she was authorized to use Edkins’ funds, and, further, admitted that she had undertaken no efforts to pay Edkins the $55,500 owed to her. Alarmingly, during oral argument, respondent admitted that she was unaware of the Wilson rule, and had not reviewed the case, despite having received the OAE’s motion and brief in support of discipline.

The Wilson rule mandates disbarment for intentional misappropriation. (Mike Frisch)

A Great Story: Remorse, Rehabilitation And Redemption

An attorney who consented to disbarment  effective in 2010 should be readmitted to practice law, according to the recommendation of a Louisiana Hearing Committee.

The one-page disbarment order

The Office of Disciplinary Counsel (“ODC”) commenced an investigation into allegations that respondent submitted false billing for work not performed in connection with the representation of his clients. Following the filing of formal charges, respondent and the ODC submitted a joint petition for consent discipline, in which respondent acknowledges that his conduct constitutes a violation of Rule 8.4(c) of the Rules of Professional Conduct.

The Louisiana Record reported on the misconduct.

The committee found that he had not engaged in unauthorized practice and was remorseful for his misconduct.

Most significantly he has complied with treatment offered by the Bar's assistance program, leading to this remarkable observation

Compared to efficacies of twelve-step programs generally, treatment centers and even more intensive recovery programs, 22 JLAP’s ninety-five (95%) percent efficacy is substantially higher than what is generally available anywhere. Indeed, JLAP’s exceedingly low five-year relapse rate, which is five (5%) percent, is beyond comparison. Compliance with a JLAP Agreement seems to be the “gold standard,” and a requisite in which the Court places great confidence and reliance. 

Recommendation

Mr. Sepcich presented compelling evidence that meets or exceeds the clear and convincing standard of proof for every requisite of Supreme Court Rule XIX, Section 24(E). The hearing committee finds that Mr. Sepcich and each witness that he presented were credible and truthful. Mr. Sepcich’s testimony is persuasive that he not only meets the requisites for readmission, but further that to readmit Mr. Sepcich would provide a very positive and ongoing service to the current and future members of the Bar. More importantly, it would reflect favorably on our legal system and serve as a meaningful example to the legal community and public regarding the very high standard of proof required to for a disbarred lawyer to achieve readmission, and the nature and scope of rehabilitation that merited readmission in this case.

The harsh but appropriate discipline imposed on Mr. Sepcich should serve to dispel any misconception that lawyers from “large” or prominent law firms are somehow immune from discipline; that such persons are treated with undue and inequal favoritism; or that potential misconduct involving “well connected” lawyers is ignored or buried by their firms or the disciplinary system. Mr. Sepcich was a managing partner of one of Louisiana’s preeminent law firms. His firm handled Mr. Sepcich’s professional conduct violations in what appears to be perfect compliance with and respect for the Code of Professional Conduct. For his professional misconduct, Mr. Sepcich received the most severe of sanctions, from which a return to the practice of law is exceedingly difficult, and a feat accomplished by only a rare few.

The content of Mr. Sepcich’s character was evident to the many outstanding practitioners and fine individuals who offered testimony and written statements on his behalf. It was vividly clear to the hearing committee. Mr. Sepcich is an example of both the best and worst experiences in our disciplinary and legal systems. While it is cliché that “experience is the best teacher,” it is the bad experience a seasoned veteran has to offer that provides the best opportunity for others to learn and avoid painful, potentially fatal errors. Put another way, the story of a lawyer’s perfect compliance with rules and laws is an enjoyable and exemplary tale. But the story of failure and severe consequences, followed by remorse, rehabilitation and redemption is a great story. Mr. Sepcich has a great story to tell. His story is one that could be invaluable to current and future members of our Bar.

(Mike Frisch)

No Favors

An accused attorney violated no ethics rules, according to a recent decision of the Louisiana Attorney Disciplinary Board.

The complaining client (Mr. Favors) had failed to appear for the hearing

Rule 1.3 states that a lawyer shall act with reasonable diligence and promptness in representing a client. Respondent's testimony and the evidence in this matter show that Respondent was hired to represent Mr. Favors after he had filed a pro se complaint against numerous defendants in a federal court suit. The suit alleged claims arising out of construction work performed on Mr. Favors' house pursuant to the Louisiana Hazard Risk Management Program. It also alleged violations of other state laws and maintained that Mr. Favors' rights under the Fourteenth Amendment of the United States Constitution, 42 U .S.C. Section 1983 and 42 U.S.C. Section 1985 had been violated. (Tr., pp. 29-31; ODC Exhibit 3; ODC Exhibit 4). After enrolling as counsel in Mr. Favors' suit in federal court, the Respondent received extensions of time to file opposition briefs to the various motions to dismiss filed by the defendants. (Tr., pp. 37-39; ODC Exhibit 3)7. She then researched the issues regarding federal subject matter jurisdiction and realized that the complaint, as drafted, lacked jurisdiction under 28 U.S.C. Section 1331 (federal question jurisdiction) or 28 U.S.C. Section 1332 (diversity jurisdiction). (Tr., p. 38). She next filed an Amended and Supplemental Complaint in the matter, hoping to cure the deficiencies identified in the defendants' motions to dismiss or convince the court to exercise supplemental jurisdiction over the state law claims. (Tr., pp. 42-44). She explained that she did not contest the defendants' motions to dismiss because she did not have a legal basis for opposing the motions and to do so could subject Mr. Favors and her to sanctions. (Tr., pp. 39-40; 47, 49, 65-67). She also believed that "to propagate and promote a legal theory that [she] knew was not sound" would be unethical. Cfr., p. 73). Respondent further testified that Mr. Favors understood that no legal basis existed upon which to oppose the motions to dismiss and also understood that she would not oppose the motions on his behalf. (Tr., pp. 40, 83-85).

The Board also found no violation of Rules 1.4 and 1.16

the Board finds it important to note that dismissal of this matter is not based solely on Mr. Favors' failure to appear and testify at the hearing. The developed record before the Board contains no evidence of misconduct on the part of the Respondent. The record instead shows that the Respondent handled Mr. Favors' federal court matter with diligence and competence. Further, although the Respondent counseled Mr. Favors to pursue his state law claims in state court, he decided not to have the Respondent do so. This decision was his alone, and does not amount to misconduct attributable to the Respondent.

(Mike Frisch)

The Purge

An attorney who was suspended earlier this year faces sanctions for failure to cooperate with an appointed trustee per this entry order of the Vermont Supreme Court

 On September 7, 2018, the trustee filed a confidential final report outlining respondent’s refusal to cooperate in his efforts. On September 12, 2018, this Court ordered respondent to comply with the trustee’s May 7, 2018 Demand Letter within fourteen days and warned her that failure to comply might result in the initiation of contempt proceedings and/or the imposition of other sanctions. This order was personally served on respondent. On October 1, 2018, the trustee filed notice with this Court that respondent had not complied with his demand letter. The Court thus scheduled a show-cause hearing to allow respondent the opportunity to show cause why she should not be held in contempt of the Court’s September 12, 2018 order. This order was also personally served on respondent.

She was held in contempt after failing to appear for the show cause hearing and now must purge the contempt

 Respondent is specifically advised that at the purge hearing, the Court will consider the imposition of sanctions including incarceration. Respondent has a right to represented by an attorney at this hearing and if she cannot afford an attorney, she has the right to request that an attorney be appointed for her by this Court. See Russell, 166 Vt. at 397, 697 A.2d at 633. Failure to retain an attorney or request an attorney by NOVEMBER 26, 2018 will result in a waiver of the right to be represented by counsel at the hearing.

Respondent is found in contempt of the Court’s September 12, 2018 order. To purge this contempt, she must comply with the Court’s September 12, 2018 order by responding to the trustee’s May 7, 2018 Demand Letter. Respondent must comply by November 30, 2018. Failure to comply may result in the imposition of a sanction of incarceration following a purge hearing.

(Mike Frisch)

 

 

Hanus Misconduct Gets Lawyer Disbarred

The Indiana Supreme Court has disbarred an attorney

We find that Respondent, Edward R. Hall, committed attorney misconduct by, among other things, disobeying a subpoena and causing another witness to do the same, neglecting clients’ cases, and engaging in a pattern of dishonesty. For this misconduct, we conclude that Respondent should be disbarred.

Count One

A parcel of improved real estate (“Property”), once owned by Respondent, was transferred to a “Land Trust” in 1995. Laura Hanus, Respondent’s girlfriend (and later Respondent’s legal secretary after Respondent was admitted to the Indiana bar), became the 100% beneficiary of the Land Trust soon thereafter. In 2012, the Property became subject to a tax sale due to the nonpayment of property taxes for several years. Respondent represented the Land Trust in legal proceedings that followed, and during those proceedings an issue arose regarding whether Respondent still had an ownership interest in the Property. Respondent failed to comply with discovery and soon was facing motions from the Lake County Auditor for sanctions and to disqualify Respondent from representing the Land Trust. The trial court scheduled a hearing on sanctions for September 4, 2014, at 9:00 a.m., and Respondent and Hanus were subpoenaed to appear. Respondent falsely informed Hanus that the hearing would not occur and she need not honor the subpoena. When neither Respondent nor Hanus appeared for the hearing at 9:00 a.m., the presiding magistrate called Respondent’s law office, spoke with Hanus, and advised her that she and Respondent needed to appear in court later that morning or be subject to contempt. Respondent and Hanus then complied.

There were two other counts of client-related misconduct.

The court

The hearing officer found no mitigating factors, nor do we. The hearing officer found several aggravating factors, including among other things Respondent’s prior discipline, his pattern of dishonesty, and the significant financial harm suffered by Client 2 as a result of Respondent’s misconduct. We agree with those findings and need expound only briefly
upon them. In Count 1, Respondent disobeyed a subpoena and caused Hanus, his girlfriend and legal secretary, to do the same by lying to her, actions that placed both of them in legal peril. Respondent significantly neglected his representations of Clients 2 and 3, lied to both of them at multiple junctures, and during the pendency of the disciplinary investigation fabricated an email purportedly sent to Client 3. Respondent’s dishonesty and neglect severely harmed Client 2 and led to a six-figure default judgment against Respondent for legal malpractice.

Respondent moved to Florida during the pendency of the malpractice suit and to date has made no payments toward satisfaction of that judgment.

“In exercising our disciplinary authority, we have an obligation to protect the public and the profession from the tactics of unscrupulous lawyers.” Matter of Johnson, 53 N.E.3d 1177, 1180 (Ind. 2016). Respondent’s disregard of legal obligations, his neglect of clients’ cases and his own malpractice case, and his pervasive dishonesty, all persuade us that disbarment is warranted in this case.

(Mike Frisch)

Reciprocal Reprimand Will Be Administered In Person

The Mississippi Supreme Court has imposed reciprocal discipline based on a sanction imposed in Florida

In 2004, Burtoff drafted estate planning documents for his mother-in-law and father-in-law, Mary and Charles Bullington. Mary Bullington died in 2012, and a dispute arose regarding the trust Burtoff had drafted. Burtoff represented his wife, the personal representative of Mary Bullington’s estate and filed suit against Charles Bullington, his former client. Burtoff took positions contrary to the interests of his former client and continued representation of his wife in the probate matter when he knew or reasonably should have known he had a conflict of interest. Burtoff ultimately was disqualified as counsel for his wife and was found to have acted in violation of Rule 4-1.9(a) of the Rules Regulating the Florida Bar. On May 31, 2018, the Supreme Court of Florida reprimanded Burtoff publicly. Because Burtoff is licensed to practice in Mississippi, the Mississippi Bar, in compliance with Rule 13 of the Mississippi Rules of Discipline, filed its formal complaint.

Analysis

In imposing the sanction of public reprimand upon Burtoff, the Supreme Court of Florida explicitly or implicitly considered the nine criteria utilized by this Court to determine
an appropriate sanction for attorney misconduct. Burtoff acknowledged the truth of the allegations in the formal complaint and did not provide any mitigating factors. Therefore, we fully support the Supreme Court of Florida’s imposition of the sanction of public reprimand and we likewise order a public reprimand and tax all costs and expenses incurred in filing the formal complaint to Burtoff.

He must appear in Hinds County Mississippi court for the administration of the reprimand. (Mike Frisch) 

Sex And Plagiarism Draws Sanction In Ohio

Dan Trevas reports on a discipline decision of the Ohio Supreme Court

The Ohio Supreme Court today suspended a Columbus lawyer for two years, with six months stayed, for misconduct that included lying to his client about her legal matters and having consensual sex with the client while the cases were pending.

In a per curiam opinion, the Supreme Court ruled that Trent R. Turner violated additional rules governing the professional conduct of Ohio lawyers when he accepted fees from a client, improperly handled those fees, neglected the clients legal matters, and then failed to respond to her communications.

Chief Justice Maureen O’Connor and Justices Terrence O’Donnell, Judith L. French, Patrick F. Fischer, R. Patrick DeWine, and Mary DeGenaro joined the opinion. Justice Sharon L. Kennedy concurred in judgment.

Lawyer Hired for Judicial Release
In January 2015, a woman, identified in court documents as Jane Doe, paid Turner a $1,000 flat fee to draft a motion seeking judicial release of Lamont Howard. Another attorney sought Howard’s release in 2013, but the motion was denied.

In March and April 2015, Doe called Turner several times, and he did not return her calls. He sent text messages telling her that he was working on the judicial release motion.

In June, having not received phone calls from Turner, Doe requested a full refund. Later that day, Turner filed the motion for judicial release and a memorandum in support. Except for the signature and contact information, those documents were identical to the documents that Howard’s prior attorney had filed—and the court had denied—in 2013.

Client and Lawyer Feud after Having Sexual Relationship
Early in 2015, Doe paid Turner an additional $300 to represent her in a civil case that was pending in small-claims court.

Turner appeared at a hearing on that case. Later that evening, he invited Doe to his house where they had consensual sex. Over the next week, Turner sent Doe more than 100 text messages, many of which were sexual in nature. Shortly thereafter, Turner and Doe began arguing and stopped communicating for a couple of weeks.

About a month after the hearing, the small claims court decided Doe’s case, but Turner did not tell her about the ruling.

Doe then began to inquire about her case and Howard’s judicial release. Two weeks after the civil case ruling, Turner texted Doe, telling her that he would share any new information he had, without telling her about the court’s decision.

Client Learns of Case Outcomes
In July 2015, Doe confronted Turner when she learned he had submitted the same judicial-release motion as Howard’s prior attorney and that he had not updated her on the status of her civil case. She again requested a full refund.

Turner falsely stated that he had a meeting scheduled with the judge in Howard’s matter, and offered Doe a $500 refund. Turner never communicated again with Doe and failed to tell her or Howard that the court had denied the motion for judicial release.

Misconduct Charges Filed
The Office of Disciplinary Counsel filed a complaint with the Board of Professional Conduct alleging that Turner had neglected two client matters, engaged in a sexual relationship with a client, and misused his client trust account.

The board found Turner violated multiple rules when representing Doe and Howard, including failing to keep his clients reasonably informed about their cases; failing to refund any unearned fees; and engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation. The board also determined that he violated the rule that prohibits a lawyer from having a sexual relationship with a client unless the consensual relationship existed prior to the lawyer-client relationship.

Based on Turner’s effort to mislead his clients into believing that the documents he had copied from Howard’s prior attorney were his own work, the board found that he engaged in conduct that adversely reflected on his fitness to practice law.

Turner also stipulated that he failed to put Doe’s $1,000 fee into his client trust account, and that he violated other rules by using his client trust account as his personal account and commingling client and personal funds.

The board recommended that the Court suspend Turner for two years, with six months stayed on several conditions, including paying Doe $1,000 in restitution.

Court Considers Sanction
When considering a proposed sanction, the Court examines aggravating circumstances that could increase the punishment for a lawyer and mitigating factors, which could lead to a reduced penalty.

The Court determined that Turner acted with a dishonest and selfish motive, committed multiple offenses, and harmed his clients. It also found he cooperated during disciplinary proceedings and submitted positive evidence of his character.

The board reported that Turner had a history of abusing alcohol and that his alcohol use contributed to his misconduct. Turner attempted to engage with the Ohio Lawyers Assistance Program (OLAP), but had failed to attend 90 consecutive days of Alcoholics Anonymous (AA) meetings, which were required to enter into an OLAP contract. The board did not give any mitigating weight for a substance-abuse disorder.

“Here, Turner engaged in a consensual but improper sexual encounter with Doe and committed other serious misconduct, including plagiarizing a court filing,” the opinion stated. “But considering his cooperative approach to the disciplinary investigation and the reinstatement conditions suggested by the board, we conclude that the board’s recommended sanction adequately protects the public and gives Turner the opportunity to practice law again if he pursues treatment and avoids additional misconduct.”

The Court suspended Turner from the practice of law for two years, but stayed the final six months of his suspension based on the condition that he not commit any more misconduct. To be reinstated, Turner must prove he attended 90 consecutive days of AA meetings, and enter into an OLAP contract. He must comply with all the terms of the OLAP contract and treatment recommendations. He also must complete 12 hours of continuing legal education related to law-office management, and pay $1,000 in restitution to Jane Doe or reimburse the Lawyers’ Fund for Client Protection for any amount the fund awards to Doe. If reinstated, he must serve two years of monitored probation.

2018-0540. Disciplinary Counsel v. Turner, Slip Opinion No. 2018-Ohio-4202.

(Mike Frisch) 

Benefit Of The Doubt And The Skeptic

The District of Columbia Court of Appeals agreed with its Board on Professional Responsibility that a one-year suspension was appropriate for an attorney's false assertions in a motion to recuse a judge but rejected the Board's proposed fitness requirement.

The Office of Disciplinary Counsel (known until 2015 as the Office of Bar Counsel) initiated disciplinary proceedings against respondent after he filed, in a criminal matter before the Honorable Russell F. Canan, a motion for Judge Canan to recuse himself. The recusal motion, which respondent filed on October 16, 2009, stated in pertinent part as follows:

[S]everal years ago, Judge Canan reported undersigned counsel for an alleged ethical violation, which was then investigated by D.C. Bar Counsel. The investigation was then dismissed without any disciplinary action being instituted against undersigned counsel.

Respondent acknowledges that these assertions were untrue in that (1) "Judge Canan had not reported [r]espondent for an ethical violation" and (2) the matter Judge Canan identified "had not been dismissed but was active in the disciplinary  system" (with the result that respondent "ultimately did receive[] discipline.

The court found the evidence insufficient to impose a fitness requirement

On this record, although we obviously lack certainty regarding whether respondent will practice ethically if permitted to resume practice at the end of his one-year suspension, we cannot say that we have real skepticism about whether he will do so. "[T]he requisite ‘serious doubt’ must be generated by evidence that is ‘clear and convincing’"; there must be "[a] firm belief in a serious doubt." Cater, 887 A.2d at 24 We do not see clear and convincing evidence of a pattern of dishonesty; at best (or worst), the evidence on this score is in equipoise, meaning  that we must give the respondent the benefit of the doubt.15 Like the Hearing Committee majority, we find "no evidence that supports a finding that there is clear and convincing evidence of a serious doubt as to [r]espondent’s ability to practice ethically" and no "clear and convincing evidence that [his ‘intentional misrepresentation to Judge Canan’] was anything other than a single, isolated incident."

Associate Judge Glickman dissented on that point and recites the attorney's lengthy record of prior discipline

In the present case, the court upholds findings that respondent intentionally made false statements in a motion seeking a judge’s recusal in violation of Rule 3.3 (a)(1) and that, in so doing, he engaged in conduct involving dishonesty, fraud, deceit, or misrepresentation. The court also upholds the finding that respondent testified falsely to the Hearing Committee in denying that his misstatements were intentional.

All this adds up to a lengthy series of ethical violations spanning two decades, one in which the misconduct grew more serious as time went on. Warnings and chastisements failed to impress respondent with the need to conform to ethical standards of practice. Based on this history of ethical breaches, the gravity of the more recent ones, the disturbing pattern of disregard for ethical norms and dishonesty they evince, and the absence of significant countervailing evidence in respondent’s favor, I have a serious doubt – "real skepticism" – about respondent’s ability to practice law ethically following his suspension.

(Mike Frisch)

A Public Service

The Florida Judicial Ethics Advisory Committee opines

Opinion Number: 2018-23
Date of Issue: September 27, 2018

ISSUES

1. Whether a judge may permit court cases to be filmed and televised on a weekly basis.

ANSWER: This is a matter of judicial administration, rather than judicial ethics.

2. Whether a judge may research, write, and appear in televised public service announcements which discuss issues surrounding family violence.

ANSWER: Yes.

3. Whether a judge may be compensated for appearing in televised public service announcements.

ANSWER: Yes.

                                                            FACTS

The inquiring judge serves in a domestic violence division and asks whether the judge may allow the weekly televising of court proceedings in that division. In addition, the judge wants to research, write, and appear in televised public service announcements which explain the different forms of restraining orders available in Florida, the court procedures for obtaining restraining orders, inform the public about government sponsored resources for family violence issues, educate the public about the effects of exposure to family violence, and educate the public about evidentiary requirements for the introduction of common types of evidence. Finally, the judge asks whether the judge may receive compensation for creating and appearing in the public service announcements.

(Mike Frisch)

 

Gambling No Mitigation

An attorney has been disbarred by a Hearing Panel of the British Columbia Law Society

Then Respondent admits that he committed professional misconduct as follows:

(a)        On or about November 16, 2016, he intentionally misappropriated $200,000 that he received in trust for his client, contrary to Rule 3-64 of the Law Society Rules;

(b)        On or about November 25, 2016, he intentionally misappropriated $200,000 that he received in trust for a second client, contrary to Rule 3-64 of the Law Society Rules; and

(c)        Between October 12, 2016 and November 9, 2016, he received a $5,000 retainer from the second client and

i.                     intentionally misappropriated $5,000 by depositing those funds into his general account when he was not entitled to those funds;

ii.                  failed to deposit the retainer into his pooled trust account, contrary to Rule 3-58 of the Law Society Rules; and

iii.                  failed to deliver a bill to his client, contrary to s. 69 of the Legal Profession Act.

[10]      The Respondent consents to an order that he be disbarred.

[11]      The Hearing Panel concluded that the conduct admitted to by the Respondent constituted professional misconduct and that the appropriate disciplinary action is disbarment.

The reason

The Respondent explained that his actions in intentionally misappropriating over $400,000 from two clients resulted from a gambling addiction.  However unfortunate the Respondent’s personal circumstances may be, the existence of a gambling disorder is not a mitigating factor justifying his conduct, nor do they suggest disbarment is not an appropriate sanction...

The Respondent cooperated with the Law Society investigation, admitted his misconduct, expressed remorse and apologized for his misconduct.  Even if we accept, in the absence of any medical or corroborating evidence, that the Respondent suffers or has suffered from a gambling addiction, this does not justify wrongfully taking clients’ money and does not constitute a mitigating factor.

(Mike Frisch)

Revisionist History And Impossible Tasks

The Wisconsin Supreme Court has denied a reinstatement petition of a former attorney who consented to license revocation in 2010.

Then his problems continued

On May 7, 2012, the State charged Attorney Mularski with two felony counts of theft, alleging that between 2006 and 2009 Attorney Mularski had embezzled hundreds of thousands of dollars from the trust account of his former law firm, Eisenberg, Riley & Zimmerman. On October 23, 2012, Attorney Mularski pled guilty to one felony count of theft and was sentenced to five years of probation with one year at the Milwaukee County House of Corrections as a condition of that probation. He was ordered to have no contact with his former firm. The sentencing court ordered Attorney Mularski to pay, inter alia, restitution to the firm's trust account in the amount of $338,019.96.

He had paid approximately $228,000 by his sentencing.

An adverse witness at the reinstatement hearing

Attorney Mularski's former spouse also appeared and testified. As relevant here, she reported that Attorney Mularski had claimed their children as exemptions on his 2016 federal tax return, despite their marital settlement agreement to the contrary.

Attorney Mularski described the tax issue as an unintentional mistake and emphasized that he had amended that tax return. Attorney Mularski disclosed that he and his former spouse are currently involved in a contentious custody and placement proceeding involving their children.

 The court

The question before this court is whether we should reinstate Attorney Mularski's license to practice law. Attorney Mularski reasons that the only way he will ever satisfy his many financial obligations will be if he is permitted to practice law again. He asks the court to reinstate him so he can make headway against his restitution obligations. He suggests he could be reinstated with various conditions and restrictions imposed on his license.

 Among the issues

The OLR agrees, noting that during the OLR's investigation and at the hearing, Attorney Mularski was unable to identify the amounts he owed to his former clients, or provide documentation of payment.

Attorney Mularski acknowledges that he has not provided the required accounting, much less satisfied his restitution obligations. He contends this should not preclude his reinstatement because, he says, creating the required accounting is an impossible task. He says that he has "provided all documentation he has available to show what has been paid, and what may be due. No additional records are available, and for the referee to find that [Mularski] has failed to meet his burden is clearly erroneous."

We disagree. The record confirms that this is a challenging problem to unravel, but also demonstrates that there is more Attorney Mularski could do to respond to this court's order and the requirement for reinstatement.

Creating an accounting that will identify the amount of restitution owed to Attorney Mularski's former clients is challenging because there are separate, sometimes overlapping, orders and judgments. As noted, in the criminal proceeding Attorney Mularski was ordered to pay $338,019.96 in restitution to the Eisenberg firm. The allegations in the underlying OLR disciplinary complaint overlap with those in the criminal complaint, but also contained separate claims relating to clients Attorney Mularski represented before he joined the Eisenberg firm.

 As to his claim re restitution

...this is revisionist history. The difficulties regarding restitution long predate the criminal proceeding and ensuing criminal restitution and no-contact orders. Before we accepted Attorney Mularski's petition for consensual license revocation in 2010, we were concerned about the clients who were owed restitution, and issued detailed orders seeking to resolve restitution as to the clients implicated in that proceeding...

Despite his first-hand knowledge that this court was keenly interested in ascertaining appropriate restitution to compensate clients injured by Attorney Mularski's misconduct, Attorney Mularski provided this court with no documentation, much less an accounting, even with respect to the clients identified in earlier court orders or those Attorney Mularski represented before he joined the Eisenberg firm. For example, both parties made repeated reference to a "spread-sheet" that apparently reflects Attorney Mularski's best effort to establish an accounting, but this document was not produced in this proceeding. Without it neither the referee nor this court has any way of independently determining whether the accounting challenge is indeed an impossible task.

 (Mike Frisch)

Brown Out

A decision of the United States Court of Appeals for the District of Columbia Circuit in the seemingly endless Cobell litigation

In this unusual case, although the original plaintiffs are designated as appellants, the actual controversy on appeal is between attorneys for the plaintiffs and an attorney who is a former member of the litigation team. Hereinafter, “Appellants” will refer to the attorneys who constitute the final litigation team. Appellants appeal the district court’s decision to award attorney’s fees and prejudgment interest. They also assert that this Court lacks jurisdiction to hear an appeal on the fees awarded. The Appellee-Cross Appellant, attorney Mark Kester Brown (“Brown”), a former member of plaintiffs’ legal team, appeals the district court’s decision not to award the full amount of attorney’s fees sought by him. See Cobell v. Jewell, 234 F. Supp. 3d 126 (D.D.C. 2017); Cobell by & through Cobell v. Zinke, No. 96-cv-1285, 2017 WL   (D.D.C. May 9, 2017).

Brown worked on the Cobell litigation for a number of years. Interpersonal issues arose among the lawyers, leading to a decrease in work assigned to Brown and to his eventual move to California. Appellants filed a motion for fees without including Brown’s fee information. Brown intervened, filing his own petition for $5.5 million using the Laffey rate as his calculation. The Laffey rate is derived from a matrix created to calculate appropriate hourly rates for attorneys in fee-shifting cases. Laffey v. Nw. Airlines, Inc., 572 F. Supp. 354, 371 (D.D.C. 1983), aff’d in part, rev’d in part on other grounds, 746 F.2d 4 (D.C. Cir. 1984). The district court placed $5.5 million of the fees awarded by the court into an escrow account pending resolution of Brown’s action. Instead of using a Laffey rate, the district court used the $350/hour rate from Brown’s engagement letter and awarded Brown $2.88 million of the funds in escrow. Brown introduced no evidence to support his actual hourly rate other than the $350/hour rate specified in his engagement letter. The rate never changed despite various amendments to the engagement letters. Furthermore, the rate was his customary hourly rate in private practice at the time he joined the team. Brown filed a motion seeking prejudgment interest, which the district court awarded. The parties each filed notice of appeal.

The court

Appellants argue that the district court erred in awarding attorney’s fees to Brown, arguing that he violated his ethical duties by withdrawing from the case without informing his clients or the district court. Brown argues the district court should have used Laffey rates to calculate his fees.

Appellants further argue that the district court erred in awarding prejudgment interest under D.C. Code § 15-109. Section 15-109 of the Code allows a party to recover interest on a judgment for damages in contract actions in order to “fully compensate the plaintiff.” D.C. Code § 15-109. Appellants argue that awarding prejudgment interest under § 15-109 was an abuse of discretion because the plain text of the Code applies only in breach of contract actions, and because awarding prejudgment interest is not appropriate when the disputed funds were held in an escrow account under terms set by the court.

We conclude that there was no abuse of discretion by the district court. Trial courts have broad discretion in determining attorney’s fees, Salazar ex rel. Salazar v. District of Columbia, 809 F.3d 58, 63 (D.C. Cir. 2015), and in “awarding . . . prejudgment interest under § 15-109,”  District of Columbia v. Pierce Assocs., Inc., 527 A.2d 306, 310 (D.C. 1987). The district court did not exceed that discretion in awarding attorney’s fees, nor in declining to award Laffey rates. Accord Salazar, 809 F.3d at 63. It also was not an abuse of discretion for the district court to award prejudgment interest because the award originated from a claim based on contract, that is, his engagement letter. Accord Pierce Assocs., Inc., 527 A.2d at 310.

 The panel consisted of TATEL and PILLARD, Circuit Judges, and SENTELLE, Senior Circuit Judge. (Mike Frisch)

Ohio Welcomes Kentucky Attorney

The Ohio Supreme Court has issued a significant decision admitting an attorney, summarized by Dan Trevas

A Kentucky attorney —who practiced law exclusively in Kentucky from an Ohio office while awaiting admission to practice in Ohio — did not engage in the unauthorized practice of law, the Ohio Supreme Court ruled today.

The Supreme Court was unanimous in concluding the Board of Commissioners on Character and Fitness inappropriately found Alice Auclair Jones engaged in the unauthorized practice of law. However, the justices were divided in their reasoning for doing so.

In an opinion that Justice Terrence O’Donnell authored for the majority, the Court concluded that Jones did not violate Prof.Cond.R. 5.5 because she was providing “legal services on a temporary basis,” an exception that permits attorneys licensed in other states to practice law in Ohio.

Chief Justice Maureen O’Connor and Justices Judith L. French and Patrick F. Fischer joined Justice O’Donnell’s opinion.

In a concurring opinion, Justice R. Patrick DeWine wrote that Jones was “working remotely” like “many employees in today’s world” and that Ohio’s rule prohibiting her from doing so is unconstitutional.

Justices Sharon L. Kennedy and Mary DeGenaro joined Justice DeWine’s opinion.

Attorney Moves to Firm’s Headquarters
Jones had been admitted to practice law in Kentucky in 2009 and served as an assistant commonwealth attorney before joining a Louisville law firm in 2014, which merged with Cincinnati-based Dinsmore & Shohl.

In 2015, Jones applied for admission to the Ohio bar and relocated to Dinsmore & Shohl’s Cincinnati office. She continued to practice law exclusively in Kentucky and maintained an office in Louisville for legal matters. The Cincinnati Bar Association recommended approval of her character and fitness to practice in Ohio.

Board Questions Practice
The character and fitness board questioned whether Jones was engaged in the unauthorized practice of law and opened an investigation. Jones argued that under the rules she was permitted to provide legal services on a temporary basis while her application was pending. A board hearing panel determined that Prof.Cond.R. 5.5(c) did not apply to Jones and that she was practicing law without authorization. The panel recommended that she stop practicing and engage only in services that could be provided by a law clerk or paralegal.

The board adopted the panel’s decision and recommended the Court disapprove Jones’ application for admission. Jones objected to the decision, arguing that the board misinterpreted the rule and that her constitutional rights under the due process clause and the “privileges and immunities clause” of the U.S. Constitution were being violated.

Court Examines Rule
Prof.Cond.R. 5.5(b)(1) prohibits a lawyer not admitted to practice in Ohio from establishing “an office or other systematic and continuous presence in the jurisdiction for the practice of law.” The rule, however, provides exceptions. Prof.Cond.R. 5.5.(c)(2) allows a lawyer to “provide legal services on a temporary basis” if the lawyer is admitted in another U.S. jurisdiction, is in good standing in that jurisdiction, regularly practices law, provides services reasonably related to pending matters in another jurisdiction, and is authorized by law and expects to appear in the pending proceedings.

Justice O’Donnell noted that “temporary” means “lasting for a limited time.” He indicated a comment to the rule provides no single test to determine whether a lawyer’s services are being provided on a “temporary basis.”

The opinion concluded that Jones satisfied the rule’s requirements.

 “She is a lawyer who is admitted in Kentucky, is in good standing in that jurisdiction, regularly practices law, and is providing legal services from an office in Ohio, and those services are reasonably related to pending or potential proceedings before tribunals in Kentucky, where she is authorized by law to appear in such proceedings,” Justice O’Donnell wrote: 

The Court determined that the length of time she has practiced law in Ohio on a temporary basis covers the time it has taken to resolve her application. Because she was not engaged in the unauthorized practice of law, the Court approved her admission without examination.

Concurrence Finds Rule Unconstitutionally Limits Jones’s Right to Pursue Her Chosen Profession
In his concurrence, Justice DeWine disagreed with the majority’s reading of Prof.Cond.R. 5.5. He found that, as written, the rule did prohibit Jones’s conduct, but that the rule “runs afoul of constitutional guarantees.”

“[A]s I see it, the problem is not that the board misread the rule; I’m convinced that the board’s reading is correct,” the concurring opinion stated. “The problem is that as applied here, the rule is irrational and arbitrary and cannot constitutionally be enforced.”

The concurrence noted that Article I, Section 1 of the Ohio Constitution recognizes that all people possess “certain inalienable rights, among which are those of enjoying and defending life, liberty, acquiring, possessing, and protecting property, and seeking and obtaining happiness and safety.” The Court has long recognized, he explained, that these liberty and property rights of the state constitution encompass a right to pursue one’s chosen profession.

The concurring opinion also found that Jones’s right to continue in her chosen profession free of unreasonable government interference was protected by the due process clause of the Fourteenth Amendment to the U.S. Constitution. Under long-established precedent, to satisfy constitutional requirements, a state rule regulating the practice of law must have a “rational connection with the applicant’s fitness or capacity to practice law.”

Justice DeWine noted that Jones did not hold herself out to be an Ohio attorney, did not practice in Ohio courts, and did not advertise for business in Ohio. Her practice was like that of any other Kentucky lawyer—except that “she was working remotely” from Ohio.

“Plainly, as applied to such a lawyer, the rule does not further the state’s interest in protecting the integrity of our court system. Jones, and others like her, are not practicing in Ohio courts. Nor does application of the rule to such lawyers serve the state’s interest in protecting the Ohio public. Jones and others in her situation are not providing services to or holding themselves out as lawyers to the Ohio public.”

2018-0496. In re Application of Jones, Slip Opinion No. 2018-Ohio-4182.

View oral argument video of this case 

(Mike Frisch)

$140 Million Man Indefinitely Suspended

Dan Trevas has a summary of a decision of the Ohio Supreme Court

The Ohio Supreme Court today indefinitely suspended a Steubenville attorney convicted of a federal felony for his role in fraudulently obtaining $140 million in federal contracts targeted to businesses owned by disabled veterans and the economically disadvantaged.

In a unanimous per curiam opinion, the Supreme Court stated that Michael J. Marshall pleaded guilty in August 2017 to one federal felony count of attempt and conspiracy to commit wire fraud. The Court suspended his license to practice law on an interim basis after the plea. In today’s ruling, the Court determined that Marshall will receive no credit for time served under the interim suspension, which means that he will have to wait at least two years before he can petition the court for reinstatement to the practice of law.

The Office of Disciplinary Counsel filed a complaint with the Board of Professional Conduct charging that Marshall committed two ethical violations for his role in the scheme that defrauded the federal government.

Attorney Part of Business that Misled Government
In 2015, Marshall was indicted along with Brandt Stover, Stephen M. Powell, and Nichole Northcraft for crimes related to falsifying information that allowed four businesses to qualify for programs intended to assist veterans and the disadvantaged. The crimes were alleged to have taken place from 2003 to 2014.

Marshall’s role in the scheme included joining Stover as employees in a business named Braun Enterprises, which participated in a Small Business Administration (SBA) program for minority business owners. The program required the company’s president, Dave Patterson, to maintain at least a 51 percent ownership and be the primary manager. Federal investigators found Patterson knew little about the company and that Stover ran it.

Marshall and Stover started another company a year later called Rainbow Tech, named after Terrence Rainbow, who was a cousin to Powell and Northcraft. Rainbow had no control over the company, which participated in the SBA program, and investigators determined it was owned and operated by Marshall, Stover, Powell, and Northcraft.

Veterans Used in Scheme
Marshall and Stover later formed Braun Technology Solutions, which listed disabled veteran Robert Sizemore as its owner. Because Sizemore’s disability prevented him from running the company, the Department of Veteran Affairs (VA) required a legally designated caregiver run the company. But the former company janitor appointed to run the company on Sizemore’s behalf was not designated as his caregiver as required by the VA.

Investigators determined the companies committed wire fraud by certifying and recertifying the companies annually through a web-based system.

Marshall was sentenced to three years of probation and assessed $250,000. He has paid the full amount to the federal government.

Board Finds Violations
The professional conduct board found Marshall participated in the conspiracy to submit false information to the SBA and VA to obtain funding that neither he nor the three other partners were qualified to receive.

The board found that he violated the rule prohibiting a lawyer from engaging in an illegal act and that he engaged in activities that involved dishonesty, fraud, deceit, or misrepresentation. The board recommended the Court indefinitely suspend Marshall and give credit for time served under the interim suspension.

The Court found that Marshall acted with a dishonest and selfish motive and that his actions spanned for more than 11 years. Because he “arguably diverted more than $140 million in federal contracts away from other small businesses that actually qualified for the SBA and VA programs,” he does not deserve any credit for the time served, the Court concluded.

2018-0809. Disciplinary Counsel v. Marshall, Slip Opinion No. 2018-Ohio-4147

(Mike Frisch)

Both Sides Now

A recent order of the Louisiana Supreme Court

The Office of Disciplinary Counsel (“ODC”) commenced an investigation into allegations that respondent accepted the legal representation of a husband and wife whose interests were directly adverse to each other, and then, after terminating the legal representation of the husband, filed suit on behalf of the wife against the husband in the same matter. Prior to the filing of formal charges, respondent and the ODC submitted a joint petition for consent discipline. Having reviewed the petition,

IT IS ORDERED that the Petition for Consent Discipline be accepted and that Jeanne Marie Laborde, Louisiana Bar Roll number 24821, be publicly reprimanded. It is further ordered that respondent shall attend the Louisiana State Bar Association’s Ethics School.

(Mike Frisch)

Ruptured Confidence

The New York Court of Appeals approved the removal from office of a judge.

Petitioner’s misconduct in her personal activities stemmed from her conviction for a misdemeanor offense of driving while intoxicated, for which she was sentenced to a one year conditional discharge (see 22 NYCRR 100.2 [A]). She was discourteous (see 22 NYCRR 100.4 [A] [2]), sought preferred treatment from the arresting officers (see 22 NYCRR 100.2 [C]), and violated the terms of her conditional discharge by ignoring orders of the court and leaving the country for an extended vacation without notice to the court or her lawyer (see 22 NYCRR 100.2 [A]). After a hearing on her second violation of her conditional discharge, petitioner’s conditional discharge was revoked, and she was re-sentenced to 60 days incarceration and three years’ probation.

Petitioner also violated the Rules of Judicial Conduct in the course of exercising her judicial duties when she failed to disqualify herself from presiding over the arraignment of a former client and attempted to exercise her discretion to have his case transferred in a manner which she thought might benefit him (see 22 NYCRR 100.3 [E] [1] [a] [i]). On other occasions, petitioner made discourteous, insensitive, and undignified comments before counsel and litigants in court (see 22 NYCRR 100.3 [B] [3]).

Attitude was an issue

Given petitioner’s apparent lack of insight into the gravity and impact of her behavior on both public perception of her fitness to perform her duties and on the judiciary overall, we conclude that any rupture in the public’s confidence cannot be repaired.

Democrat & Chronicle reported that she was recently indicted on weapons charges. (Mike Frisch)

Former Foley & Lardner Partner Suspended

A two-year suspension from the Wisconsin Supreme Court

Attorney Wiensch was admitted to practice law in Wisconsin in 1991. He has no prior disciplinary history. He was formerly a partner of Foley & Lardner, LLP, (Foley firm) working out of the firm's Milwaukee, Wisconsin office. At all times material to this matter, Attorney Wiensch worked in the firm's trust and estates practice group.

The representation at issue

While working at the Foley firm, Attorney Wiensch provided estate planning services to a husband and wife who were owners of a privately owned business corporation. Attorney Wiensch prepared a trust under the terms of which the husband and wife were the trust donors and their children were the trustees and beneficiaries. Attorney Wiensch drafted an Installment Sale Agreement, pursuant to which the husband sold most of his stock in the company to the trust in exchange for a promissory note in an amount in excess of $50 million based on the appraised value of the stock sold. The purpose of the stock sale was to transfer wealth to the clients' children, via the trust, free of gift and estate taxes and to ensure that any future appreciation of the stock held by the trust would not become part of the husband's estate.

After the husband died

An IRS estate tax attorney served as the examiner for the IRS in conducting the audit. The IRS attorney corresponded with Attorney Wiensch in an effort to obtain information material to the audit. In September 2012, in response to requests from the IRS attorney, Attorney Wiensch sent the IRS copies of an Installment Sale Agreement, a Collateral Pledge Agreement, and a Guaranty of Specific Transaction. Attorney Wiensch represented to the IRS that the Installment Sale Agreement memorialized the terms of the stock sale and that the Collateral Pledge and Guaranty related to the stock sale. The copy of the Installment Sale Agreement Attorney Wiensch sent to the IRS in September 2012 contained a defined value formula clause. Attorney Wiensch altered and misdated the Installment Sale Agreement he sent to the IRS in September 2012. He did not prepare this document contemporaneously with the stock sale. The Installment Sale Agreement the husband actually executed on an earlier date did not contain the defined value formula clause.

 Attorney Wiensch also altered and misdated the Guaranty he sent to the IRS in September of 2012. He did not prepare this document contemporaneously with the stock sale. He copied the signatures of the clients' children from a different document bearing a different date and pasted the signatures on the copy of the Guaranty he sent to the IRS attorney.

The wife died after the IRS had issued a notice of deficiency

 In a December 23, 2016, letter from his counsel to the OLR, Attorney Wiensch admitted that he had created the August 1999 Durable Power of Attorney to Make Gifts and the February 2011 Durable Power of Attorney for Financial Matters in late 2015 or early 2016. By email transmitted to the OLR on March 31, 2017, counsel for Attorney Wiensch informed the OLR that Attorney Wiensch conceded that he had altered and misdated the Installment Sale Agreement and Guaranty of Specific Transaction he provided to the IRS in September 2012 in connection with the audit of the husband's estate.

When the IRS pursued the web of deals

Attorney Wiensch created an altered Durable Power of Attorney to Make Gifts dated August 1999 by copying the wife's signature from another document. Attorney Wiensch never informed the IRS attorney or the Foley attorneys that he had altered and misdated the Durable Power of Attorney to Make Gifts that he sent to the IRS attorney in October 2015.

The IRS went to the children and the forgeries came to light

By letter dated August 22, 2016, the Foley firm informed the IRS that Attorney Wiensch was no longer with the firm and that they believed the August 1999 Durable Power of
Attorney to Make Gifts and the February 2011 Durable Power of Attorney for Financial Matters that Attorney Wiensch had provided to the IRS were not authentic and were being withdrawn. The Foley firm subsequently alerted the IRS to the irregularities later discovered with regard to the Guaranty and the defined value formula clause in the Installment Sale Agreement and the firm reported Attorney Wiensch's conduct to the OLR.

 The court approved the stipulated sanction

After closely reviewing the matter, we accept the stipulation and determine that Attorney Wiensch engaged in the 13 counts of misconduct alleged in the OLR's complaint. We further conclude that a two-year suspension of Attorney Wiensch's license to practice law is an appropriate level of discipline to impose in view of the serious nature of the misconduct and the various aggravating and mitigating factors present in this case.

(Mike Frisch)

Day Of Atonement

A Louisiana Hearing Committee recommends disbarment of an attorney on these defaulted charges

The Complainant, Ms. M, hired the Respondent to represent her in a divorce proceeding and to file a reconventional demand for spousal support, child custody and child support, in September of 2016. Ms. M paid the Respondent a $3000.00 retainer. A court date concerning the incidental matters was set for October 12, 2016, falling on Yom Kippur, a Jewish Holiday. Ms. M is Jewish, and she requested that the Respondent file a Motion for a continuance. Respondent represented to Ms. M that her court date was continued to November 18, 2016.

On November 18, 2016, Ms. M, along with her mother, who flew in from Philadelphia, PA for the hearing, and the Respondent, appeared at the courthouse, only to find that their matter was not on the docket and the opposing party and his attorney were not present. Respondent explained to Ms. M that she believed that the opposing party was going to file the continuance. Ms. M could not reconcile the Respondent’s explanation considering the fact that she was the one requesting the continuance for religious reasons. Respondent then told Ms. M that she was “going straight upstairs” to file the necessary pleadings to have the matter reset. When Respondent returned, she represented to Complainant that the new court date was January 18, 2017. Complainant later discovered that the Respondent failed to file the pleadings necessary to have the matter reset for January 18, 2017. Ms. M also discovered that Respondent failed to file anything. As a result, Ms. M was divorced by default, without her issues of child custody, child support, or spousal support being addressed by the Court.

Respondent requested prescription drug medication from Ms. M on at least two separate occasions. First Respondent telephoned Ms. M and requested to purchase Xanax from Ms. M. A couple hours later, Ms. M appears at her home with an inform pauperis affidavit and purchased the Xanax. Respondent requested that Ms. M sign the informa pauperis application and affidavit, notwithstanding the fact that Complainant had previously paid a $3000.00 retainer. Respondent never filed the completed informa pauperis application and affidavit with the court.

In December of 2016, Complainant contacted the Respondent regarding a fight with her ex-spouse and requested an appointment to discuss the matter and what she believed to be an upcoming hearing in January. Respondent replied by stating that “she hurt her toe” and asked if the Complainant had any Codeine, Vicodin, or Percocets, that she could either purchase or exchange for a “discount” on legal services. Ms. M advised the Respondent that she did not have any of the requested drugs. The Complainant provided ODC with text messages wherein Ms. Hingel asked Complainant for prescription drugs.

Complainant finally terminated the Respondent after Respondent agreed to meet with her on December 16, 2016, at 10:00 a.m. Respondent cancelled the meeting at 10:05 a.m. and asked if the meeting could be conducted over the telephone instead. In response, Complainant terminated the Respondent and requested a refund of unearned fees and her client file. Respondent failed to provide Complainant with an accounting and failed to return the client file. Respondent did return $2,500.00 of the $3,000.00.

Sanction

Here, the conduct of Respondent and her representation of Complainant, consisting of both soliciting and purchasing prescription medication from Complainant, criminal conduct, also includes the failure of Respondent to perform legal services on behalf of Complainant. Despite telling Complainant that she had obtained a court hearing date in Complainant’s divorce suit, in fact she had not filed any pleadings and not performed any legal services for her client. Added to these findings is the fact that Respondent, currently ineligible to practice law for non-compliance of Bar requirements, failed to cooperate with the ODC in the disciplinary charges that had been made against her.

(Mike Frisch)

 

Winner announced for Zacharias Prize for Scholarship in PR

Samuel Levine of Touro Law Center advises us that the "winner has been selected for the ninth annual Fred C. Zacharias Memorial Prize for Scholarship in Professional Responsibility: Eric S. Fish, Against Adversary Prosecution, 103 IOWA L. REV. 1419 (2018). The Prize will be awarded at the AALS Annual Meeting in New Orleans in January."

Congrats, Eric! (Alan Childress)

Not Covered

A public censure from the Rhode Island Supreme Court involves representations concerning insurance coverage

[Employer] Assalone and respondent agreed that respondent would end the employment relationship in July 2016. They understood that respondent would form her own business entity and obtain her own professional liability insurance as of August 1, 2016. Nevertheless, they agreed to continue to share office space. The respondent hired her own staff and began operating her own firm as Carden Law Group, LLC, as of that agreed date. Significantly, respondent did not obtain her own professional liability insurance policy, but instead began to misrepresent to others that she was insured under Assalone’s policy.

The respondent hired a nonlawyer assistant to help with preparing the necessary documents to conduct real estate closings. The assistant’s duties included forwarding appropriate documentation to lenders funding the real estate transactions for which respondent would serve as the closing agent, including documentation evidencing that respondent had professional liability insurance in effect. At respondent’s direction, her assistant forwarded information to the lenders that their closings would be performed by Carden Law Group, LLC, and specified that Carden was insured under Assalone’s insurance policy. These representations were false.

 In December 2016, respondent was preparing to conduct a real estate closing for the lender, Movement Mortgage. A representative of this lender questioned why the closing agent was Carden Law Group, LLC, but the requisite insurance coverage was under Assalone’s name. The lender requested an explanation prior to approving Carden as the closing agent. The respondent directed her assistant to prepare a letter, on Assalone’s stationary, stating that Carden was insured under Assalone’s professional liability policy. The assistant prepared the letter at respondent’s direction. Next, respondent used Assalone’s signature stamp to affix Assalone’s signature to that letter, and forwarded it to the lender. Satisfied with this explanation, the lender funded the loan and respondent conducted the closing.

Assalone had neither authorized respondent to represent to third parties that she was covered under Assalone’s policy, nor authorized respondent to use Assalone’s signature stamp to execute the letter forwarded to Movement Mortgage. When Assalone became aware of this transaction and demanded an explanation, respondent falsely told Assalone that the assistant had prepared the letter and affixed Assalone’s signature thereto without respondent’s knowledge or consent.

Assalone notified Disciplinary Counsel that respondent had made false representations regarding her insurance coverage. In her initial response to Counsel’s inquiries, respondent reasserted that she was completely unaware that her assistant had forwarded the misleading letter to Movement Mortgage. However, respondent subsequently admitted that she had directed her assistant to prepare the letter.

(Mike Frisch)