Wednesday, October 12, 2016
The California State Bar Court Review Department has recommended disbarment in a case involving misappropriation
Three men—David Benullo, David Goldstein, and David Klawans—retained Kaplan to represent them as their attorney in the sale of a movie script entitled Mucho Dinero to Blake Freeman, a producer. Benullo initially contacted Kaplan about retaining him by sending an email with the subject line "lawyer for a deal." On December 29, 2011, Goldstein emailed Benullo, inquiring whether Kaplan was acting as a lawyer or manager in the sale of the script. Benullo replied: "[S]teve’s the lawyer who came in to deal with this for us." Kaplan was copied on this email. Shortly thereafter, on January 10, 2012, Benullo, Goldstein, and Klawans entered into a written Deal Memorandum with Kaplan that stated Kaplan would be paid for "professional services in negotiating and drafting the terms of the purchase of the Script by Producer [Freeman]."
In June 2012, the parties agreed on a sales price of $90,000 for the script. The three men agreed to split the proceeds as follows: 42.5 percent each to Benullo and Goldstein and 15 percent to Klawans. Freeman paid the sales proceeds to Kaplan in two installments: $65,000 on August 1, 2012, and $25,000 on September 6, 2012. Kaplan did not deposit the money in his CTA. Instead, he placed it in a Wells Fargo Bank checking account, which he used for his movie production company, Rainstorm Entertainment, Inc. (Rainstorm Account).
Under the Deal Memorandum, Kaplan would be paid 10 percent of Benullo’s share of the sales proceeds and 7.5 percent each of Goldstein’s and Klawans’s shares—$7,706.20 of the $90,000. When Kaplan received the $65,000 payment, he properly withheld $5,565.58 as his fee and paid Benullo, Goldstein, and Klawans their respective shares of the remaining $59,434.42, including $25,553 to Goldstein. When Kaplan received the $25,000 payment on September 6, 2012, he properly withheld $2,140.62 as his fee. He stipulated that he paid Benullo and Klawans their shares of the remaining $22,859.38 but failed to pay Goldstein his share, which was $9,828.25.
The $9,828.25 was misappropriated.
The Review Department rejected the contention that the conduct was not intentional.
The attorney has no record of prior discipline. (Mike Frisch)