Monthly Archives: March 2014

Ohio lawyer suspended indefinitely after conviction for filing false documents with IRS and falsifying e-mail in malpractice action

Ohio lawyer suspended indefinitely after conviction for filing false documents with IRS and falsifying e-mail in malpractice action.

Advertisements

Leave a comment

Filed under Uncategorized

Ohio lawyer suspended indefinitely after conviction for filing false documents with IRS and falsifying e-mail in malpractice action

Hello and welcome to this Ethics Alert blog which will discuss the recent Ohio Supreme Court opinion suspending a lawyer indefinitely after her conviction for filing false documents with the Internal Revenue Service and falsifying an e-mail in a malpractice action. The disciplinary opinion is Disciplinary Counsel v. Land, Slip Opinion No. 2014-Ohio-1162 (March 27, 2014) and the disciplinary opinion is here: http://www.supremecourt.ohio.gov/rod/docs/pdf/0/2014/2014-Ohio-1162.pdf
According to the opinion, the lawyer was working at a large law firm and she created and submitted fraudulent documents to the IRS on two separate occasions in 2010 in an attempt to cover up errors that she made in drafting estate planning documents which apparently cost her clients hundreds of thousands of dollars in tax benefits. The lawyer also created an e-mail in early 2010 in an attempt to falsely bolster her credibility in a malpractice lawsuit which alleged that she failed to properly advise the client.

In 2012, the lawyer pled guilty to federal charges of corruptly attempting to obstruct and impede the IRS and was sentenced to five years of probation, including three years of home detention, abstain from alcohol use, and continue mental-health treatment during the probation as long as her probation officer believed that it was necessary and pay penalties of $75,000.00.
Disciplinary charges were filed against the lawyer by the Ohio Board of Commissioners on Grievances and Discipline. During the disciplinary hearing, the lawyer testified that she felt overwhelmed by pressure from her law firm and the “challenges” to her professional skills and that this pressure led her to greater alcohol consumption and self-medication with anti-anxiety drugs which she purchased over the Internet.

The Ohio Supreme Court opinion adopted the findings of the Ohio discipline board and found that the lawyer engaged in conduct that reflected adversely on her trustworthiness and engaged in deceitful, dishonest, or fraudulent conduct that was prejudicial to the administration of justice and adversely reflected on her fitness to practice law.

The opinion also agreed with the Board’s recommendation that the lawyer be suspended indefinitely from practicing law and that prohibiting any petition for reinstatement until she completes the federal probation. The lawyer must present proof that she has satisfactorily completed, or is in compliance with, her Ohio Lawyers Assistance Program contract and that she has continued to receive treatment from a therapist until the therapist decides it is no longer needed.

Bottom line: “In a time of universal deceit – telling the truth is a revolutionary act. – George Orwell. Hopefully we aren’t in Orwell’s world…yet, but this case again illustrates how a lawyer can seriously compound a mistake and turn it into an elaborate web of deceit and misrepresentation which results in serious allegations and sanctions. Again, if a lawyer makes a mistake, it is always better to admit it and accept the consequences instead of potentially making things far worse by covering it up. If this had been in Florida (or many other states), the sanctions may (or would) have been much more severe and possibly disbarment.

Please be careful out there!

Disclaimer: this e-mail is not an advertisement and does not contain any legal advice and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire
Law Office of Joseph A. Corsmeier, P.A.
2454 McMullen Booth Road, Suite 431
Clearwater, Florida 33759
Office (727) 799-1688
Fax (727) 799-1670
jcorsmeier@jac-law.com
http://www.jac-law.com

1 Comment

Filed under Attorney discipline, Attorney Ethics, Attorney misrepresentation, dishonesty, fraud, joe corsmeier, Joseph Corsmeier, Lawyer conduct adversely affecting fitness to practice, Lawyer conduct prejudicial to the administration of justice, Lawyer criminal conduct, Lawyer discipline, Lawyer ethics, Lawyer Ethics and Professionalism, Lawyer false statements, Lawyer misrepresentation, Lawyer sanctions

Iowa lawyer who failed to timely serve discovery requests and then covered up by creating false certificates of service is suspended for 6 months

Hello and welcome to this Ethics Alert blog which will discuss the recent Iowa Supreme Court opinion suspending a lawyer for 6 months for engaging in misconduct by covering up his failure to timely serve discovery requests by creating false certificates of service to make it appear that they were timely served. The disciplinary opinion is Iowa Supreme Court Attorney Disciplinary Board v. Jeffrey K. McGinness, Case No. 13–1213 (March 21, 2014) and the disciplinary opinion is here: http://www.iowacourts.gov/About_the_Courts/Supreme_Court/Supreme_Court_Opinions/Recent_Opinions/20140321/13-1213.pdf?search=Jeff+McGinness#_1

According to the opinion, the lawyer represented a plaintiff in a civil action in 2012 and his client’s deposition had been scheduled for June 18, 2012. The facts were undisputed and are as follows:

“Five days before the scheduled deposition, (the lawyer) realized he had not served discovery requests on opposing counsel. (The lawyer) believed his failure to obtain responses from the opposing party prior to his client’s deposition was a strategic mistake. To cure his oversight, (the lawyer) embarked on a course of dishonest conduct he will regret for the remainder of his legal career. Instead of seeking an accommodation from opposing counsel or simply proceeding with the scheduled deposition, he decided to lie about his failure to serve discovery. (The lawyer) began by emailing opposing counsel demanding responses to the discovery requests by the end of the next day ‘to avoid the need to reschedule the deposition.’ When opposing counsel responded that he had not received any discovery requests from the lawyer, he replied via an email to which he attached two discovery requests he had purportedly served March 21, 2012. The discovery requests contained the lawyer’s signature as well as purported certificates of service indicating the requests had been served March 21 by U.S. Mail. The certificates of service appeared to have been signed by (the lawyer’s) administrative assistant.” (emphasis supplied).
The opposing attorney was suspicious so he examined electronic data (metadata) embedded in the discovery documents and determined the documents had been created in June 2012. He hired a handwriting expert and, after comparing the certificates of service on the discovery documents e-mailed by the lawyer with the certificate of service on the response to the discovery requests, the expert concluded the certificates of service were photocopies of the previous documents.

The opposing attorney confronted the lawyer and, instead of admitting his fabrication (according to the opinion, he did not “fess up”), he “embellished” and said that he explicitly recalled preparing and signing the discovery requests at the same time that he responded to opposing attorney’s discovery requests and that he may have served them the same day. He also stated that since he did not sign the certificate of service, he could not speak to the allegation of identical signatures and that his secretary, who signs many certificates of service each week, had no recollection of signing it.

Understandably, the opposing attorney then filed a motion for sanctions and, “(o)nce again, (the lawyer) embellished instead of fessing up. (The lawyer) filed a response with the district court in which he maintained neither he nor his assistant photocopied nor duplicated previously used certificates of service. (The lawyer) added a new layer to his fraudulent conduct by hiring an expert at his own expense to defend the position he knew to be false. (He) represented to the district court that his own expert found the signatures were not identical. Finally, (the lawyer) attempted to discredit opposing counsel’s theory that he was motivated by a desire to delay the deposition.” (emphasis supplied)

The lawyer then advised his client about the pending sanctions motion and stated in an e-mail that opposing counsel had alleged that he had fabricated certificates of service dates in an attempt to delay the client’s deposition, that he did “not take these allegations lightly”, and that he had discussed the motion with opposing counsel. He also told the client he had hired, at his own expense, “a forensic document examiner who is willing to testify that the certificates are not fabricated.”

It gets better: “The court scheduled a hearing on the sanctions motion. At the hearing, (the lawyer) once again chose not only to maintain the lie, but to embellish. He insisted the certificates of service were not fabrications. He also attacked the conclusions of opposing counsel’s handwriting expert. After the district court expressed its opinion to (the lawyer) it did not think it needed a handwriting expert to see the fabricated certificates of service matched the one on the response to opposing counsel’s discovery requests, (the lawyer) asserted there was no evidence to explain why the certificates of service were identical. (The lawyer) acknowledged his administrative assistant’s signature was on the certificates of service, but stressed that she signs a significant number of documents each week. He further stressed that he has multiple administrative assistants and that any of them could have prepared the documents.” (emphasis supplied).

The trial judge rejected the lawyer’s “now elaborate deceit” and found that he had “intentionally and knowingly affixed false certificates of service to discovery requests to cause unnecessary delay in the progression of the litigation. The (judge) further noted, ‘(the lawyer’s) behavior is so shocking and egregious that it is hard even to know what to say about it.’” The district court also stated that “(i)t is deeply disappointing to find that a member of the bar has engaged in such elaborate, calculated, and premeditated deceit.” The court ordered the lawyer to pay $5,152.00 to opposing counsel and $2,348.00 to the Iowa Judicial Branch and then forwarded a copy of the sanctions order to the state court administrator. After receiving the district court’s order, (the lawyer) disclosed his conduct to his law firm and was told that he must report his actions to the disciplinary authorities and that “he had betrayed their trust. At this point, (the lawyer) voluntarily withdrew from the firm and began a solo practice in Iowa City; however, he did not self-report.

After receiving the complaint/sanctions order of the court, the disciplinary board sent it to the lawyer. The lawyer responded and admitted that had he engaged in the misconduct and stated that he had “extreme disappointment” in himself and recognized that his actions reflected “a severe lapse in judgment.” He said that there was no excuse, and, in falsifying the certificates of service, he was “motivated by a misguided loyalty and attempt to protect a client” and that instead he should have admitted the oversight and requested an extension. He also noted his belief that submitting his client for a deposition without the benefit of the discovery responses could have compromised his client’s case. Finally, he noted that while it would take significant time to regain the lost trust of his friends and law partners, he believed the disciplinary process and the process of mending damaged relationships would make him a better person and attorney.

The board then filed a complaint alleging that the lawyer engaged in misconduct related to lack of candor, dishonesty, deceit, misrepresentation, or fraud, and conduct prejudicial to the administration of justice. At the disciplinary hearing, the lawyer admitted to the misconduct and expressed remorse and presented testimony and affidavits from a senior partner in his former firm, an administrator at the University of Iowa College of Law, a family friend, and other lawyers as character witnesses and offered evidence showing he had served on a local school board, local municipal boards, and in various organizations and had coached wrestling, soccer, and baseball.

The disciplinary commission found that the lawyer engaged in misconduct and violated Iowa Bar rules related to lack of candor, dishonesty, deceit, misrepresentation, and/or fraud, and conduct prejudicial to the administration of justice and found multiple aggravating factors, including the failure to self-report, repeated failure to tell the truth, and failure to turn to the numerous friends and colleagues comprising his support system for advice, and mitigating factors, including the lawyer’s sincere and straightforward admission to the commission, lack of prior discipline, and community service. The commission recommended a six month suspension, which the opinion approved.

Bottom line: “Oh what a tangled web we weave when first we practice to deceive.”- Sir Walter Scott. This case illustrates how a lawyer can seriously compound a mistake and turn it into an elaborate web of deceit and misrepresentation which resulted in serious allegations and sanctions against. As I have said many times, if a lawyer makes a mistake, it is always better a admit it and accept the consequences (the Nixon rule) instead of potentially making things exponentially worse by covering it up. This is an extreme case; however, if it had been in Florida, the sanctions may have been much more severe and possibly disbarment.

Be careful out there!

Disclaimer: this e-mail is not an advertisement and does not contain any legal advice and the comments should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire
Law Office of Joseph A. Corsmeier, P.A.
2454 McMullen Booth Road, Suite 431
Clearwater, Florida 33759
Office (727) 799-1688
Fax (727) 799-1670
jcorsmeier@jac-law.com
http://www.jac-law.com

Leave a comment

Filed under Attorney discipline, Attorney Ethics, Attorney misrepresentation, deceit, dishonesty, fraud, joe corsmeier, Joseph Corsmeier, Lawyer conduct prejudicial to the administration of justice, Lawyer discipline, Lawyer ethics, Lawyer Ethics and Professionalism, Lawyer false statements, Lawyer false testimony, Lawyer sanctions

Proposed California Ethics Opinion concludes that a lawyer’s statements about a party’s negotiating goals or willingness to compromise may include “puffery” if they are not false

Hello and welcome to this Ethics Alert blog which will discuss the recent proposed California Bar Ethics Opinion which states statements about a party’s negotiating goals or willingness to compromise may include allowable “puffery” provided the statements do not contain false statements of material fact. The proposed opinion is Cal. State Bar Standing Comm. on Prof’l Responsibility & Conduct, Proposed Formal Op. 12-0007 (1/24/14) and the proposed opinion is here: 2014 Proposed Cal Bar opinion on puffery

The proposed opinion considers what conduct may be permissible puffing in settlement negotiations as opposed to unethical false statements of material fact. The opinion states that Sections 6068(d) and 6128(a) of the California Business and Professions Code prohibit attorneys from engaging in deceit or collusion, California lawyers have been disciplined for deceiving opposing counsel, and California Bar rules provide that disbarment or suspension is appropriate for dishonesty.

The opinion also refers to California’s Attorney Guidelines of Civility and Professionalism Section 18 which discusses a lawyer’s conduct when negotiating a written agreement on behalf of a client. The guidelines are nonbinding and cannot be used as a basis for disciplinary charges and, since there are no direct California Bar rules on ethics in negotiations, the proposed opinion adopted the guidance provided in ABA Formal Ethics Op. 06-439 (2006). Referring to that ABA opinion, the proposed opinion states that, although it is improper for an attorney to make false statements of material fact during the course of a negotiation, statements about a client’s negotiating goals or willingness to compromise may include allowable “puffery” if the statements do not contain false statements of material fact.

According to the proposed opinion, although the California Rules of Professional Conduct do not have a rule similar to ABA Model Rule 4.1, the ABA rule is consistent with judicial opinions in California cases involving tort claims alleging fraud by attorneys. The proposed opinion also discusses several statements in hypothetical negotiations to settle a personal injury claim arising from an automobile accident and provides guidance.

Plaintiff’s lawyer tells defense counsel that an eyewitness saw the defendant texting at the time of the accident, when actually no eyewitness has been located. This assertion is an improper false statement of fact, intended to mislead the defendant and his lawyer and is not an expression of opinion but a material statement that a reasonable person would consider important in making settlement decisions.

Plaintiff’s counsel informs the mediator that the plaintiff was making $75,000 per year when he was actually earning $50,000. This is not an expression of opinion but an intentional misstatement of a verifiable fact that is material to the negotiations.

 Plaintiff’s lawyer overstates the client’s “bottom line” settlement number. This is allowable “puffery” that is not deceitful or fraudulent. A negotiating party should expect that its adversary will not reveal its true negotiating goals or willingness to compromise. An attorney could violate the statutory duty of confidentiality in Business and Professions Code Section 6068(e) by revealing the client’s actual bottom line.

Plaintiff instructs his or he lawyer not to reveal his new, better-paying job to the other side even though the parties have agreed to exchange additional information about the plaintiff’s wage loss claim. Failure to disclose the plaintiff’s new job would suppress a material fact and amount to a material misrepresentation and even though a lawyer is generally required to follow a client’s instructions, the lawyer must counsel the client that he or she may not misrepresent or suppress evidence.

Defense counsel states that the defendant’s insurance policy is $50,000 when it is really $500,000. This statement is improper because it is an intentional misrepresentation of a material fact intended to mislead the plaintiff and his counsel.

 Defense lawyer insists that the defendant will file for bankruptcy if the plaintiff wins at trial. If defense counsel knows that the defendant does not qualify for bankruptcy protection, this statement is improper because it is an intentional misrepresentation aimed at misleading the opponent about the defendant’s ability to pay; however, if defense counsel believes that bankruptcy is an available option, even if unlikely, a statement that the defendant could or might consider filing for bankruptcy would probably be a permissible negotiating tactic. 

The proposed opinion refers to the following additional authorities on ethics in negotiations: ABA Formal Ethics Op. 06-439, (2006), Comment (2) to Model Rule 4.1 the ABA Litigation Section’s Ethical Guidelines for Settlement which is here: http://www.abanet.org/litigation/ethics/settlementnegotiations.pdf, Comment c to Section 98 of the Restatement (Third) of the Law Governing Lawyers (2000), and Ethics Rule Prohibits Lies, but Recognizes Room for Negotiating Tactics,” 29 Law. Man. Prof. Conduct 136.

The proposed opinion concludes that lawyers who are negotiating on behalf of a client do not necessarily act unethically by overstating the client’s settlement goals or downplaying the client’s willingness to compromise and these inaccurate statements may qualify as allowable “puffery” rather than false statements of material fact, however, lawyers cannot misrepresent or make false statements about major relevant facts such as a falsely claiming to have a favorable eyewitness, inflating a personal injury client’s past earnings, or understating the amount of available insurance coverage.

Bottom line: This proposed California ethics opinion is not final and is currently in the comments stage. As I always say, lawyers cannot lie, cheat, or steal (among other things); however, according to this proposed ethics opinion (and ABA Formal Ethics Op. 06-439), a little “puffery” is apparently okay.

Be careful out there!

Disclaimer: this blog is not an advertisement nor does it contain any legal advice and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire
Law Office of Joseph A. Corsmeier, P.A.
2454 McMullen Booth Road, Suite 431
Clearwater, Florida 33759
Office (727) 799-1688
Fax (727) 799-1670
jcorsmeier@jac-law.com
http://www.jac-law.com

Leave a comment

Filed under Attorney Ethics, Attorney misrepresentation, deceit, dishonesty, joe corsmeier, Joseph Corsmeier, Lawyer ethics, Lawyer Ethics and Professionalism, Lawyer false statements, Lawyer puffery

The Florida Bar’s Board of Governors considers revisions to confidentiality, trust account and fee rules and include definitions of retainers, flat fees, and advance fees

Hello and welcome to this Ethics Alert blog which will discuss the recent Notice of the Florida Bar’s Board of Governors of its intent to consider changes to the Rules Regulating The Florida Bar. The Notice is in the February 15, 2014 Florida Bar News and is on the Bar’s website here: http://www.floridabar.org/DIVCOM/JN/jnnews01.nsf/8c9f13012b96736985256aa900624829/d77053b5698a70ef85257c7b004b3384!OpenDocument

The most significant of the proposed revisions would amend Rule 4-1.6 to permit lawyers and law firms to reveal some confidential client information when a lawyer is changing law firms or law firms are merging if the confidential information will not injure the client. The proposed change to Rule 4-1.6 would add subsection (c)(6) to provide for limited disclosure of information “to detect and resolve conflicts of interest between lawyers in different firms arising from the lawyer’s change of employment or from changes in the composition or ownership of a firm, but only if the revealed information would not compromise the attorney-client privilege or otherwise prejudice the client.” Language would also be added subsection (e) to provide that, “A lawyer must make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.”

Another proposed revision would amend Rule 4-1.5 stating that nonrefundable fees are considered earned on receipt and must not be placed in lawyers’ trust accounts and also providing a definition for retainers, flat fees, and advance fees. The Comment to Rule 4-1.5 would also provide, “A nonrefundable retainer or nonrefundable flat fee is the property of the lawyer and should not be held in trust. If a client gives the lawyer a negotiable instrument that represents both an advance on costs plus either a nonrefundable retainer or a nonrefundable flat fee, the entire amount should be deposited into the lawyer’s trust account, then the portion representing the earned nonrefundable retainer or nonrefundable flat fee should be withdrawn within a reasonable time. An advance fee must be held in trust until it is earned. Nonrefundable fees are, as all fees, subject to the prohibition against excessive fees.”

The proposed revisions would also amend Rule 5-1.1 and create an exception within subdivision (a)(1) related to commingling to permit a lawyer to deposit sufficient funds into the lawyer’s trust account to make up a shortfall in the trust account caused by misappropriation, bank error, bank charge or a bounced check.

The amendments to Rule 4-1.6 resulted from recommendations made by the ABA Ethics Commission 20/20 and, as I pointed out in a previous Ethics Alert, the amendments to Rule 4-1.5 resulted from an earlier attempt by The Florida Bar to amend the Comment to Rule 4-1.5 which was rejected by the Florida Supreme Court in an opinion stating that any definitions should be in the rule, not the comment. According to the Notice, if you would like a copy of the text of any of the proposed amendment, you can e-mail jgreen@flabar.org or call Janellen Green at (850) 561-5751. You should refer to the title or item number and the date of publication (2/15/14).

Bottom line: If approved by the BOG and implemented by the Florida Supreme Court, these rule revisions would clarify issues related to confidentiality when a lawyer leaves a law firm and/or the law firm is purchased, prevent lawyers who place funds into a trust account to reduce shortages from being charged with commingling, clarify the nature of a non-refundable fee, and provide definitions for retainers, flat fees, and advance fees.

Be careful out there!

Disclaimer: this Ethics Alert is not an advertisement and is for informational purposes only. It does not contain any legal advice and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire
Law Office of Joseph A. Corsmeier, P.A.
2454 McMullen Booth Road, Suite 431
Clearwater, Florida 33759
Office (727) 799-1688
Fax (727) 799-1670
jcorsmeier@jac-law.com
http://www.jac-law.com

Leave a comment

Filed under Attorney Ethics, Attorney/client confidentiality, Attorney/client privilege and confidentiality, Confidentiality and privilege, Departing lawyer and law firm responsibilities, Florida Bar, Florida Lawyer Ethics and Professionalism, joe corsmeier, Joseph Corsmeier, Lawyer escrow accounts, Lawyer ethics, Lawyer Ethics and Professionalism, Lawyer trust accounts