Thursday, March 19, 2020

Swimming With Lawyers

The California State Bar Court Review Department recommended a short suspension for an aquatic conflict of interest and breach of confidentiality

Respondent Richard James Foster is charged with multiple counts of professional misconduct involving conflicts of interest arising from his representation of a professional swimmer and his failure to provide her with written disclosure of his relationships in the professional swimming world. Foster’s client was in a contract dispute with USA Swimming, an organization within which Foster maintained close professional relationships. He also previously represented the USA Swimming coach who tendered the contract offer to his client. The hearing judge found Foster culpable of five counts of misconduct, but not culpable of a moral turpitude violation for concealing documents. The judge recommended discipline, including an actual suspension of 60 days.

Both Foster and the Office of Chief Trial Counsel of the State Bar (OCTC) appeal. Foster asserts that he is only culpable of one count of misconduct for failing to provide written disclosure to his client that he had previously represented the client’s coach in an employment contract negotiation. Foster believes that an admonition is sufficient discipline. OCTC supports the hearing judge’s findings of culpability, but argues that the judge should not have dismissed the moral turpitude violation. OCTC asserts that the hearing judge’s discipline recommendation was in error and that we should recommend a one-year actual suspension. Upon our independent  review of the record (Cal. Rules of Court, rule 9.12), we affirm the hearing judge’s findings of culpability and her discipline recommendation.

The attorney

Foster has been involved in various organizations related to aquatic sports since the early 1990s. During the time relevant to his misconduct in this matter, he was on the water polo technical committee for the Fédération Internationale de Natation (FINA),  which is an international organization that governs competition in water sports such as swimming, diving, water polo, and synchronized swimming. Previously, Foster had served on the board of directors for the United States Olympic Committee (USOC); as president of United States Aquatic Sports (USAS), which represents the United States in FINA; as president of USA Water Polo; as the organizing committee chair for the 2004 United States Olympic swim trials; and as vicepresident and an executive council member for the Swimming Union of the Americas (ASUA), a swimming association for North and South America. When Foster was president of USA Water Polo in 1990, he met Chuck Wielgus at a USAS meeting. Wielgus was involved with USA Swimming, the governing body for competitive swimming in the United States.

The client

Dagny Knutson was an outstanding young swimmer who received an athletic scholarship to Auburn University beginning in fall 2010. After her coach at Auburn decided to move to another university, she began to question where she would swim thereafter. In spring 2010, Mark Schubert, a coach for the United States National Team, proposed to Knutson that USA Swimming would pay her rent, living expenses, and college tuition if she trained professionally at USA Swimming’s Center of Excellence program in California. Knutson decided to accept Schubert’s offer to join USA Swimming, and thus relinquish her amateur status. The agreement was not memorialized in writing. Sports agent Evan Morgenstein began representing Knutson in October 2010 after Knutson’s mother signed an Athlete Representation Agreement with Premier Management Group, LLC (PMG) as Knutson’s parent/guardian. 

The problem

Around November 2010, USA Swimming fired Schubert and informed Knutson that Schubert had no authority to make his offer on behalf of USA Swimming. USA Swimming notified Knutson that it would no longer pay her rent, living expenses, and college tuition while she trained at its facility in Fullerton, California. Thereafter, Knutson sought legal representation. Morgenstein introduced Knutson to Foster, who was Morgenstein’s attorney. Knutson was aware of this relationship between Foster and Morgenstein. In November 2010, Foster began representing Knutson on a pro bono basis. There was no written agreement between them.

Foster had represented Schubert in an employment contract negotiation with USA Swimming in 2005, but did not disclose this relationship in writing to Knutson. Further, he did not disclose in writing to her that he had a professional relationship with the then-executive director of USA Swimming, Wielgus.

There was litigation brought by the swimmer and eventually bar proceedings

We disagree with the hearing judge that Foster’s misconduct involved dishonesty as there is no clear and convincing evidence that Foster committed acts of deceit or intended to deceive Knutson. However, we do find that his misconduct was intentional. The judge detailed Foster’s actions in finding aggravation under standard 1.5(d): he told Wielgus that he would not escalate to litigation, he advised Knutson to sign an agreement releasing Schubert and USA Swimming from liability, and he instructed Knutson to release Morgenstein from any liability in exchange for a copy of her Athlete Representation Agreement. While these actions indicate an intentional breach of conflicts rules, they do not evidence dishonesty. 

The client was found to be vulnerable but there was significant mitigation

Foster clearly failed to protect Knutson. His relationships with USA Swimming, Wielgus, Schubert, and Morgenstein prevented him from fulfilling his duties as her attorney. Knutson was unaware that Foster intended to pursue negotiation with, and not litigation against, USA Swimming due to his personal friendships. Foster put himself in multiple situations where he had to weigh conflicting interests. And he favored Morgenstein over Knutson and shielded him from liability by advising Knutson to sign a waiver in exchange for a copy of the Athlete Representation Agreement.

We agree with the hearing judge that Foster should have been more attentive to the ethical and fiduciary duties he owed to Knutson and the legal profession. His misconduct was easily avoidable. Foster chose to care more about protecting his own interests in the aquatic sports world than fulfilling his duty of loyalty to his client. However, he displayed impressive mitigation that outweighs aggravation, justifying discipline at the lower end of the spectrum. (Std. 1.7(c).) Foster’s substantial mitigation includes almost 30 years of discipline-free practice, extraordinary good character, and good works that contributed to the betterment of his community. Considering the requirement under standard 2.5(d) for actual suspension, the comparable case law, and the facts of this matter, we affirm the hearing judge’s recommendation of a 60-day suspension.

Swimming World reported on the litigation. (Mike Frisch)

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