ARDC Alleges That A Retired New York Lawyer Wrongfully Engaged In Unauthorized Practice of Law

1. At no time has Respondent applied for admission to practice law in Illinois or been admitted to the Illinois bar.

2. On April 24, 1974, Respondent was admitted to practice law in New York. At no time was he admitted to practice law in any other states. On August 12, 2010, he registered for retirement status with New York, and he remained on retirement status until August 19, 2011, when he resumed active status. While on retirement status, Respondent was not permitted to practice law in any jurisdiction.

3. On July 1, 2005, Respondent leased an apartment from Dennis Martinek (“Martinek”) at 111 Groveland Avenue in Riverside, Illinois (“the Groveland apartment”). Shortly thereafter, Respondent informed Martinek that he was a New York attorney.

4. From February 5, 2008, to August 12, 2011, Martinek was an investor in a business, Politico, LLC d/b/a Vini’s of Lincoln Park, which operated a pizza restaurant, Vini’s Pizza, at 2429 N. Lincoln Avenue in Chicago (hereinafter, collectively “Vini’s”).

5. In August 2010, Martinek informed Respondent about a number of legal problems that Martinek had encountered in connection with Vini’s, including alleged fraud and mismanagement by the then-General Manager of the company, Rosendo Diaz (“Diaz”).

6. Between August 2010 and September 2010, Respondent and Martinek agreed that Respondent would represent Martinek and Vini’s in at least eight different legal matters. Those matters included:

a. a tax claim by the State of Illinois because Diaz had allegedly failed to pay sales tax on pizza sales at Vini’s;
b. a claim against Diaz related to his purported mismanagement of Vini’s;
c. the defense of four creditors’ claims against Vini’s for accounts receivable, including claims by:

d. An eviction matter related to a 5-day notice that had been served on Vini’s on September 10, 2010 to vacate its business premises on Lincoln Avenue in Chicago;
e. An alleged banking error by Vini’s credit card processing company, First Merit Bank, wherein Vini’s had purportedly not been credited with $5,000 in pizza sales proceeds.

7. Between August 2010 and September 2010, Respondent and Martinek began negotiating as to the fees that Respondent would be paid for the legal work referenced in paragraph six, above, but they did not enter into a specific agreement as to the amount of those fees at that time.

8. Between September 2010 and August 2011, Respondent provided legal advice and services to Martinek and Vini’s on the matters referenced in paragraph six, above. During that period, Respondent corresponded with Vini’s creditors and their counsel, reviewed and analyzed documents related to the respective claims, performed legal research on those claims, drafted letters to creditors for Martinek’s signature, and advised Martinek as to how to proceed in each matter.

9. In or about July 2011, Respondent and Martinek agreed that Martinek would barter monthly rent payments from Respondent’s rental of the Groveland apartment by applying those amounts as payments toward Respondent’s legal fees for the matters referenced in paragraph six, above. The monthly rental amounts were $1,000 from July 1, 2011 through July 1, 2012. For legal services that Respondent provided on Martinek’s behalf in 2011 and 2012, Martinek waived a total amount of $12,000 in rental payments.

10. In addition to the waiver of rental payments as referenced in paragraph nine, above, between September 2010 and August 2011, Respondent also received $20,605.46 in payments for fees by or on behalf of Martinek and Vini’s in connection with the matters referenced in paragraph six, above.

11. On February 14, 2003, Martinek filed a complaint against Respondent in the Circuit Court of Cook County, seeking to evict Respondent from the Groveland apartment and to recover $7,530 in allegedly unpaid rent. That case was docketed as Martinek v. Caro, case number 2013 M1 703844. Respondent was served with the complaint and summons in the matter shortly thereafter.

12. On October 3, 2013, Respondent and his wife, Svetlana Caro, jointly filed a Chapter 13 bankruptcy petition in the United States District Court for the Northern District of Illinois, and that case was docketed as In re Caro and Caro, case number 13 BK 38958. The matter was assigned to the Honorable Janet Baer. Respondent’s filing of the bankruptcy petition caused Martinek’s claim in case number 2013 M1 703844 to be stayed.

13. On November 25, 2013, in connection with case number 13 BK 38958, Respondent filed an adversary complaint against Martinek. The adversary complaint was docketed as Caro v. Martinek, United States District Court for the Northern District of Illinois case number 13-1334. In the adversary claim, Respondent sought an order denying Martinek’s claim for unpaid rent and granting Respondent compensation for legal services provided to Martinek “[b]eginning in September 2010 and until Richard Caro ceased representing Martinek at the end of June 2012.”

14. Respondent attached to his adversary complaint in case number 13-1334, a copy of a Statement for Services dated October 26, 2012 (Attached hereto as Exhibit 1). The Statement of Services listed the time expended by Respondent handling legal matters on behalf of Martinek, and it included a total of 170.6 hours for the matters referenced in paragraph six, above. On in his Statement of Services, Respondent listed 105.3 hours that he had expended between August 12, 2010, and August 19, 2011.

Conclusion: there appears to be no doubt as to the unauthorized practice of law. The decision to file the adversary complaint in bankruptcy appears to have caused the bankruptcy court and the ARDC to look into the matter.

Edward X. Clinton, Jr.