The Truman Show Comes To Attorney Discipline – With Disastrous Results

The Truman Show was a successful movie starring Jim Carrey in which he played the role of Truman Burbank who lives an ordinary life. What Truman does not know is that the entire world around him is composed of actors. Truman is the star of a television show in which he is the only “real” person. There are many lessons to be learned from this sad case.

Yesterday the Illinois Supreme Court entered an order disbarring Vincent Porter, an attorney who the Court believes engaged misconduct serious enough for disbarment. Porter is an attorney and also acts as a sports agent. He did not realize it, but he came to star in his own version of The Truman Show, which ultimately led to his disbarment.

Vincent Porter came to star in his own version of The Truman Show. The transaction he was involved with was a sting operation set up by the FBI. The main witness against him was Marc Pennebaker, an FBI agent who set up the entire scam and recorded hours of conversations with Porter and others discussing a litany of fraudulent actions he was planning to perform, but never did. There were no investors. There was no deal. There were no victims. There was no financing. All that resulted from the FBI operation was the disbarment of Vincent Porter, whose greatest sin was, in my opinion, that he was duped by the FBI and failed to take measures to protect himself. His disbarment is a direct result of his failure to document precisely who he was representing and what his duties were as a lawyer. He was also fooled by a confidential informant who knew what to say, how to say it, when to say it and to record it.

This is how the Hearing Board described the charges:

The Administrator brought a two-count complaint against Respondent charging him with misconduct arising out of his participation in a purported deal to purchase Burger King franchises and related property. The deal, in reality, was part of an FBI sting, which culminated in Respondent’s arrest and eventual entry into a deferred prosecution agreement. Because of his role in the purported deal, Respondent was charged with assisting a client in conduct the lawyer knows is fraudulent, in violation of Rule 1.2(d); making statements of material fact or law to a third person which the lawyer knows are false, in violation of Rule 4.1(a); failing to disclose a material fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by the client, in violation of Rule 4.1(b); committing a criminal act that reflects adversely on his honesty, trustworthiness, or fitness as a lawyer, in violation of Rule 8.4(b); and engaging in dishonesty, in violation of Rule 8.4(c). Hearing Board Opinion January 18, 2019 at 2.

According to the ARDC and the Hearing Board, “Respondent was a participant in, and counsel to, a group of individuals that planned to defraud investors in a real estate transaction.” Further, Porter was accused of making false statements and withholding information about the transaction.

Porter became involved with Joseph Vaccaro who was being investigated by the FBI. Billy Crafton, a confidential information, contacted Vaccaro Vaccaro then introduced Porter to Crafton, who held meeting and made recordings. Crafton, Vaccaro and Porter discussed a scheme under which they would create an entity to purchase 13 Burger King Restaurants and sell those restaurants to a group of professional athletes at an inflated price. Porter met with Crafton and Vaccaro and later met with Pennebaker.

Comment

There is an old saying that if you meet with a group of investors and you have not clarified who you represent, it will later turn out that you represented all of them. It apparently never occurred to Porter to prepare an engagement letter which would have identified his client or clients. Had he taken this small step, it is possible that this entire fiasco could have been avoided. Because he did not protect himself or think about the attorney-client relationship, the ARDC alleged and the Hearing Board found that Porter represented a group of investors including himself, a confidential informant (Crafton) and another target of the investigation (Vaccaro).

Back to the Facts:

Respondent testified he also discussed the Burger King deal with Crafton at a restaurant in Chicago. An audio recording of a meeting between Respondent and Crafton on July 22, 2014 reflects the following statements:

Respondent indicated he was conducting due diligence and would be handling the legal side and structuring the LLCs;

Respondent and Crafton agreed that the real purchase price for the restaurants was $16 million, but Crafton would tell investors that the entire $20 million was going toward the deal;

Respondent confirmed that Crafton should not disclose to potential investors that Respondent, Crafton and Vaccaro would be taking $4 million off the top; Crafton should state that the other 50% stake in the Burger Kings would be owned by a group of New York investors whose identity he did not know; Crafton should not reveal that, in actuality, Vaccaro and Respondent would own the remaining 50% of the Burger Kings; and Crafton should deny any ownership interest or receipt of kickbacks;

Respondent indicated he would create multiple LLCs to make it appear that another group of investors would own 50% of the Burger Kings; When Crafton asked for confirmation that he should not disclose the actual structure of the deal, Respondent replied “Yeah, we’d all be committing suicide . . . you know, career suicide;”

Respondent and Crafton referred to a “home run deal” that the investors would not know about, and a “single” deal. The two deals were also characterized as an “A” deal and a “B” deal; and Respondent indicated he has the experience to do more deals in the future.

Hearing Board Opinion at pages 6-7.

Porter then prepared an Operating Agreement an LLC which was to be owned by the investors brought to the deal by Crofton. Hearing Board at 8. (Here again, the engagement letter would have greatly assisted Porter. Had he created an engagement letter he would have had to figure out who his client was. He might have chosen to represent Crofton or he might have chosen to represent the “investors.” Either choice would have been better than no choice at all because he could have then sorted out what his professional duties were.).

The October 1, 2014 Meeting

Porter agreed to meet with Pennebaker (posing as a financial advisor), Vaccaro and Crafton at Crafton’s office in San Diego. Another FBI agent played the role of “potential investor.” The meeting was, of course, recorded and Porter was arrested after the meeting was over. The Hearing Board explained:

On October 1, 2014 Pennebaker, again posing as a financial advisor, met with Respondent, Vaccaro and Crafton at Crafton’s office in San Diego. Pennebaker brought along another undercover FBI agent who posed as a potential investor. Both video and audio recordings were made of the meeting. (Tr. 78-79, 116, 125-26, 139, 150).

Pennebaker testified the purpose of the meeting was to gather more information and evidence relating to the Burger King investment. During the meeting Respondent stated the final details of the transaction had not been negotiated, but funds would be received from a New York investment group which would have a 50% ownership stake. When Pennebaker asked about the $37 million purchase price, Respondent again indicated the price had started higher and had been negotiated down. Respondent indicated he would be handling the legal end of arranging the deal, although the closing would be handled by Virginia attorneys, and he explained he was not taking any stake in the deal because as a lawyer doing the legal work, he did not want to create a conflict of interest for himself. (Tr. 84, 139, 141, 150; Adm. Ex. 11, Oct. 1, 2014, Track 5, 6, 7).

Respondent testified the information he presented at the meeting was given to him by Vaccaro and Crafton. He acknowledged that the pitch they made was based on a valuation of $40 million for the Burger King restaurants, with Crafton’s group of ten investors contributing a total of $20 million for 50% ownership of the Burger Kings and Vicar’s group owning the other 50%. Respondent recalled the purchase price was represented to be non-final at all times, and he advised Pennebaker that all the details would be disclosed once the deal was made. (Tr. 79-82, 207-08).

Respondent testified that no documents were signed at the October meeting and no papers changed hands. He denied knowingly making any misrepresentations to anyone or misrepresenting anything to the point of putting it on paper. (Tr. 81, 209, 214).

The Hearing Board

Porter attempted to defend himself on the ground that he did not represent any of the parties involved. The ARDC alleged that Porter represented a group of investors including himself and Vaccaro. The Hearing Board disagreed and concluded in Delphic fashion “We find that an attorney-client relationship was established.” Hearing Board at 12. (Note the problem – since Porter did not prepare and make everyone sign an engagement letter he lost the opportunity to decide who he would represent.)

The Findings:

We find that an attorney-client relationship was established. Although we did not hear testimony from Vaccaro or Crafton, we reviewed numerous statements made by Respondent during meetings and telephone conversations, which statements demonstrate he was acting as the attorney for the business group proposing the investment. In July 2014, he indicated to Crafton that his role was to handle the legal side of the transaction, conduct due diligence, and structure LLCs. He also drafted a preliminary version of an LLC operating agreement and provided that document to Crafton. When speaking to Pennebaker in September, Respondent stated his role was to handle the legal work for the deal; he was involved in due diligence and negotiations with Burger King; and funds from the investors would be deposited into his attorney IOLTA account. At the October in-person meeting, Respondent again stated that his role was to handle the legal end of the transaction.

While Respondent consistently disavowed that he would handle the actual closing, as that work had to be done by Virginia attorneys, the closing was only a portion of the legal work necessary for completion of the deal. By Respondent’s own representations, he held himself out as being responsible for the legal side of the transaction and took actions in accordance with his role as attorney. We find, therefore, that the predicate relationship for Rules 1.2 and 4.1 has been established.

Rule 1.2(d) – assisting client in conduct the lawyer knows to be fraudulent

The Administrator charged Respondent with violating Rule 1.2(d) by conduct including:

participating in discussions with Vaccaro and the informant about offering an investment deal to their professional athlete clients which concealed the true terms of the purchase of the Burger King franchises (including the ownership and purchase price of the franchises) from their clients;

agreeing to do the legal work to effectuate the scheme;

telling the informant to misrepresent the purchase price and ownership of the franchises to investors;

telling Pennebaker that the purchase price of the franchises was $37 million, and Respondent did not have an interest in the deal; and telling Pennebaker and the other FBI agent that another investor group would own the remaining 50% of the franchises.

We find Respondent engaged in each of the foregoing acts and by doing so, assisted clients Vaccaro and Crafton in furthering a fraudulent scheme. Fraud encompasses a broad range of human behavior, including “anything calculated to deceive . . . whether it be by direct falsehood or by innuendo, by speech or by silence, by word of mouth or by look or gesture.” In re Armentrout, 99 Ill. 2d 242, 251, 457 N.E.2d 1262 (1983).

Pennebaker’s testimony, as well as the recordings that were presented to us, showed that the three individuals plotted, as a group, to present a financial transaction in a way that would conceal the benefit they would personally realize from the transaction. That benefit was twofold. First, they intended to collect $20 million for the purchase of a group of properties that cost only $16 million, and then divide the remaining $4 million between themselves. Second, they planned to take a 50% ownership stake in the properties without making any financial investment whatsoever. Their financial benefit and interest in the transaction would not be disclosed to the investors. As we saw from Respondent’s September 19th telephone call with Pennebaker, Respondent represented that the purchase price was $37 million, which was more than twice the price he had discussed with Vaccaro and Crafton. Further, he falsely stated that a New York group was investing funds for the other one-half ownership, and he would have no ownership interest in the properties. In reality, the second group would be Respondent, Vaccaro and Porter, but their identities would be concealed by layers of LLCs. Respondent’s representations to Pennebaker were contrary to the facts set forth in Respondent’s discussions with Vaccaro and Crafton.

We recognize the investors were not misinformed as to their rate of return, and because the deal was never consummated, no one suffered a financial loss. The absence of an actual loss, however, does not erase the misconduct that occurred. By participating in crafting a deal with secret terms, presenting the deal to a potential investor without disclosing those terms, advising Crafton to misrepresent information, and making affirmative false statements regarding the investment, Respondent assisted in perpetrating a fraud.

We reject Respondent’s claim that he did not knowingly commit any misconduct. Pennebaker’s testimony, as well as the recordings, show that Respondent knew the actual terms of the proposed transaction and yet misrepresented those terms and advised Crafton to do the same. Further, Respondent’s claim that he was merely repeating information given to him by Vaccaro carries little weight in light of his role as the attorney structuring the deal. If the valuations for the properties were constantly changing, as he maintained, he had an obligation to ferret out the truth before passing information to potential investors. Further, we view Respondent’s lack of recall of key conversations, his vague testimony, and his portrayal of himself as a victim as nothing more than attempts to disguise his own involvement in the scheme. All in all, we did not find him to be a credible witness. By contrast, we regarded Mark Pennebaker as a reliable and objective witness who testified with precision and clarity.

Respondent had many opportunities to disagree with proposals made by Vaccaro and Crafton, to advise them to take a different course, or at least withdraw from representation and from the deal, but he did not do so. Instead, he became an active participant and took actions in furtherance of the scheme. Therefore we find that he engaged in misconduct in violation of Rule 1.2(d). Hearing Board Pages 13-15.

The Hearing Board also found that Porter violated Rule 4.1(a) knowingly making false statements of fact material fact to a third person and 8.4(c) dishonesty, fraud, deceit or misrepresentation and 8.4(b) a criminal act.

Rule 4.1(a) Violation

The Administrator charged Respondent with violating Rule 4.1(a) by:

falsely telling Pennebaker on September 19, 2014 that the purchase price of the franchises was $37 million; Respondent had no interest in the deal; and another investors group would own the remaining 50% of the franchises (in return for a $17 investment); and

by falsely telling Pennebaker and another undercover agent on October 1, 2014 that other investors would be investing money and those investors would receive the other 50% ownership interest in the franchises.

We have addressed the foregoing misrepresentations in the prior section and determined that Respondent made those statements and he knew they were false. We further find that the $37 million purchase price and the identity of other owners in an investment, including whether or not Respondent had an ownership interest in the deal, would be material to the investors’ decision in proceeding with the transaction. Therefore, we find a violation of Rule 4.1(a).

Rule 4.1(b) – knowingly failing to disclose material facts when disclosure is necessary to avoid assisting a criminal or fraudulent act by client

While the previous charge involved the providing of false information, Rule 4.1(b) involves the failure to disclose material information. The Administrator charged Respondent with violating Rule 4.1(b) by not disclosing to the undercover agent and Pennebaker that:

the true purchase price of the franchises was $16 million; and

Respondent, Vaccaro and Crafton would have an interest in ownership and would receive $4 million dollars out of the investors’ money.

We find this charge was proved. Respondent did not disclose the true nature of the Burger King transaction during his September 19, 2014 telephone call with Pennebaker, or during the October 1, 2014 meeting with Pennebaker and the second undercover FBI agent. As stated previously, the true purchase price and ownership interest was material information that should have been provided to prospective investors, as was the fact that $4 million of the purchase money would be going directly to Respondent, Vaccaro and Crafton. Respondent’s failure to disclose assisted his clients’ criminal or fraudulent conduct in violation of Rule 4.1(b).

Rule 8.4(c) Violation

The Hearing Board found:

Rule 8.4(c) – dishonesty, fraud, deceit or misrepresentation

In In re Edmonds, 2014 IL 117696, par. 62 the Court stated “there is essentially no way to define every act or form of conduct that would be considered a violation” of Rule 8.4(c) as “[e]ach case is unique and the circumstances surrounding the respondent’s conduct must be taken into consideration.” Rule 8.4(c) “is broadly construed to include anything calculated to deceive, including the suppression of truth and the suggestion of falsity.” Id. at 53. Motive and intent are rarely proved by direct evidence and must be inferred from conduct and circumstances. See In re Stern, 124 Ill. 2d 310, 529 N.E.2d 562, 565 (1988)

The Administrator charged Respondent with violating Rule 8.4(c) by engaging in the exact same conduct that was set forth in the Rule 1.2(d) charge. We found with respect to that charge that Respondent assisted in conduct that was fraudulent by making statements that were false, performing legal work to further the scheme, directing Crafton to misrepresent facts, and failing to disclose information that was material to the transaction. Further, his actions were taken with knowledge of the fraudulent nature of the transaction.

Our prior discussions amply support a finding that Respondent violated Rule 8.4(c). His motive and intent to deceive investors was further demonstrated by his agreement that Crafton should not disclose the actual deal to investors; and by his indication that disclosure would be “career suicide.” In addition, the video of the October 1, 2014 meeting demonstrated to us that Respondent had no trouble providing misleading and inaccurate information to the undercover agents. Indeed, we found his cavalier attitude in misrepresenting facts to be deeply disturbing. For the reasons stated, we find Respondent engaged in dishonesty, fraud deceit and misrepresentation.

The Panel also found a violation of Rule 8.4(c) criminal conduct. The Review Board essentially affirmed all the factual findings of the Hearing Board but recommended a suspension of three years. The criminal case against Porter was resolved by a deferred prosecution agreement. The Illinois Supreme Court disbarred Porter on September 21, 2020.

Comment:

This case is a teaching tool for every lawyer who is in the transactional practice. Porter was unlucky because his mistakes were on tape and on video. He was promised, but never received, a hidden interest in the deal. (That should have been disclaimed in the engagement letter. Porter could have been charged with entering into a contract with a client without advising the client to get his own lawyer, but the ARDC did not bother with that.)

The case worries me. In my career clients have, at times, said all sorts of things to me about what they intended to do. I have tried my best to correct them and stop them from engaging in illegal conduct. Porter did not speak up when the FBI agent and the confidential informant read their lines with Shakespearian skill. He sat mute or agreed or went along with the scheme. He was a dupe or chump. The joke was on him. If you wish to keep your license, you cannot be duped in this fashion. You must speak up when the client proposes something unlawful or inappropriate or just plain deceptive.

Porter did not write an engagement letter or even bother to write emails to the participants so that he could summarize the meetings they held. He had nothing to defend himself with. Because he never did the hard work of figuring out who he represented he never understood his duties to that “client.” Had he done so there is a chance that this fiasco could have been avoided. He should have asked other questions such as “Who represents the investors?” “Has anyone recommended that they engage counsel?” I would have been uneasy at the prospect of doing a deal of that size with no counsel on the other side to protect the imaginary athletes who were investing. That Porter never asked these questions saddens me. He never showed any sign, in my opinion, of trying to protect anyone, client or non-client.

He could also have asked the promoters to get a valuation of the deal by a reputable real estate appraiser. He could have requested audited financials of the “franchises.” Better yet, he should have requested tax returns. That too would have protected him and the investors. The promotors would have made excuses, but Porter could have used that to get out of the deal. (They could never have gotten an appraisal because the Burger King franchises did not exist and no one would sign an appraisal valuing nonexistent franchises. There were no tax returns either because the franchises did not exist.) Corporate lawyers ask questions, lots of questions. It does not appear that Porter asked any questions.

Long ago an experienced lawyer told me “if it looks to good to be true, it probably is.” This is a disbarment that did not need to happen. An engagement letter and a few minutes of careful thought could have avoided all of this.

The most troubling aspect of this case is that Porter never made a dime on the deal and no one lost any money. The deal papers were nowhere near completion and Porter, it appears, was waiting for further information from the “clients.” That is probably why the federal government entered into a deferred prosecution agreement with him. Why is this troubling? There is a chance that Porter is just as much a victim as the supposed investors were. Many lawyers in Illinois have done far worse conduct and not received a disbarment. But for the FBI, this “deal” would never have happened.

In the end of The Truman Show, Truman figures out that he is in a show that his life is onstage that his wife and friends are not real and he leaves the set. “In case I don’t see you, Good Morning, Good Afternoon and Goodnight.” To be a corporate lawyer in our world, you have to be at least as smart as Truman Burbank and know when to walk away.

If you are in the practice of law and you are concerned about something, call an ethics lawyer now. Don’t wait until the “deal” goes bad. Speak up. Ask questions. Ask the questions you would want to know the answers to if you were investing in the venture. Ask for the name of the lawyer or the accountant. If those people don’t exist, you can assume it is a scam of some sort. Warn your clients and protect your license.

Ed Clinton, Jr.

http://www.clintonlaw.net

Lawyer Suspended One Year for Violation of Rule 4.2

A lawyer licensed in New York has been suspended for one year for sending emails to a party he knew to be represented by counsel. See In re Matter of Henry Lung, 2018-09536 (Supreme Court of New York, Appellate Division, Second Department, dated April 18, 2020). The email communications surfaced in a domestic relations matter.

Charge one alleges that the respondent, in representing a client, communicated about the subject of the representation with a party he knew to be represented by another lawyer in the matter, without consent, in violation of rule 4.2(a) of the Rules of Professional Conduct ( 22 NYCRR 1200.0 ), as follows:

The respondent represented the father in a matrimonial action in Supreme Court, Queens County. The mother was represented by Morghan Richardson. On or about September 22, 2016, the parties entered into a so-ordered settlement of the matrimonial action, which included a parental access schedule regarding the parties’ minor child. Thereafter, on or about February 8, 2017, the mother filed a pro se family offense petition [*2] against the father in Family Court, Queens County, seeking, inter alia, an order of protection prohibiting him from having contact with her and with their minor child. The petition was granted and an order of protection was issued. Some of the email correspondence is quoted below:

“On May 12, 2017, Richardson emailed the respondent an offer to negotiate outstanding issues between the parties. In response, the respondent sent an email rejecting the offer. His email reply was copied to the mother, and included the following:

“Ever since the beginning of my representation of the father, I have recognized him to be the better parent, meaning the best interests of this child would be met with the child living with him, not your client, as the primary residential parent. Your client has taken enough rope, as the saying goes, and this nonsense needs to come to an end. You are continually advising her to commit acts of contempt of Court & forget about ever asking me to consider anger management.’ What really needs to happen here is your client needs to take classes on how to be a much better parent.

* * *

“But I know the truth Morghan, and the truth is that you are a liar. You lie and lie and continually pump your client’s head with total garbage just so that her parents (the real money train in all of this) continue to pay you. That is the real and only truth that matters in this entire case.”

The same day, Richardson replied and asked the respondent to refrain from contacting her further if he intended on “name-calling” and refusing to work collaboratively. The respondent replied on May 12, 2017, and copied the mother, stating:

“Your client is going to lose custody & if you doubt me, keep sending useless emails like this. The gravy train’ will end for you soon enough. Yes I absolutely do think of you as a liar insofar as you are actively advising your client to continue her current position.'”

Charge two alleges that the respondent, in representing a client, [*4] used means that had no substantial purpose other than to embarrass or harm a third person, in violation of rule 4.4(a) of the Rules of Professional Conduct ( 22 NYCRR 1200.0 ), by sending emails to opposing counsel, copied to opposing counsel’s client, which criticized opposing counsel, and accused opposing counsel of engaging in professional misconduct, based upon the conduct described in charge one.

Charge three alleges that the respondent engaged in conduct that adversely reflects on his fitness as a lawyer, in violation of rule 8.4(h) of the Rules of Professional Conduct ( 22 NYCRR 1200.0 ), based upon the conduct described in the two charges above.

The referee (somewhat akin to a hearing officer) recommended a one year suspension.

After consideration the Appellate Division sustained the recommendation of the Referee.

The Grievance Committee moves to confirm the report of the Special Referee, and for the imposition of such discipline upon the respondent as this Court deems just and proper. The respondent, by his counsel, moves to confirm in part and to disaffirm in part the report of the Special Referee. The respondent submits that the Special Referee properly sustained the three charges of professional misconduct, and requests that this Court consider the evidence in mitigation in determining the appropriate measure of discipline to impose.

“Based on the respondent’s admissions and the evidence adduced, we find the Special Referee properly sustained the charges. The Grievance Committee’s motion to confirm the report of the Special Referee is granted, and the respondent’s motion to confirm in part and disaffirm in part the report of the Special Referee is granted to the extent that the charges are sustained and is otherwise denied.

In determining the appropriate measure of discipline, the respondent seeks leniency, and asks this Court to consider: (1) the findings of the Special Referee, who concluded that his actions, while improper, were motivated by his desire to zealously represent his client; (2) that his misconduct was isolated to this one client matter and will not be repeated; and (3) the character evidence provided on his behalf. Notwithstanding the mitigation advanced, we find that the respondent’s claims that he acted out of frustration do not justify his violations of the Rules of Professional Conduct. He repeatedly sent emails to a party he knew to be represented, sometimes sending multiple emails on the same day and at inappropriate nonbusiness hours, which emails contained disparaging information in an aggressive tone. We find the [*6] respondent did so in an effort to criticize opposing counsel, to accuse her of engaging in professional misconduct, and to try to undermine the relationship between opposing counsel and her client. Even though the respondent knew his actions were improper, and despite being put on notice by opposing counsel that his actions were improper, he continued undeterred and without regard to the Rules of Professional Conduct. We have also considered as an aggravating factor the respondent’s extensive disciplinary history, which includes a public censure from this Court (Matter of Lung112 AD3d 148 ), four Admonitions, and two Letters of Caution.

Under the totality of the circumstances, we find that the respondent’s conduct warrants his suspension from the practice of law for a period of one year.”

Comment: Rule 4.2 prohibits this type of conduct. In this case, the sanction was more severe than typical because the lawyer used the emails to criticize his opposing counsel. The fact that he copied opposing counsel on the emails was not a mitigating factor.

Ed Clinton, Jr.

https://www.clintonlaw.net/legal-ethics.html

Three Indiana Judges Suspended For Participating In A Brawl at a White Castle

https://www.npr.org/2019/11/14/779339897/3-indiana-judges-suspended-after-white-castle-brawl-that-left-2-of-them-wounded

The NPR story lays out the facts of this bizarre encounter between three very drunk judges and two assailants, Alfredo Vasquez and Brandon Kaiser. The encounter began after a night of alcohol consumption when one of the judges raised her middle finger to Mr. Vasquez and Mr. Kaiser who were driving in a car near a White Castle parking lot. The two men parked the car and an argument began. Things rapidly escalated and there was a brawl between two of the judges and two assailants. One of the assailants had a gun and shot the Judge Adams and Judge Jacobs. The opinion does note that two judges sustained gun shot wounds and that all three judges accepted responsibility and cooperated with the investigation.

The Indiana Supreme Court summarized the facts in this fashion:

At around 12:30 a.m. on May 1, Respondents and Clark Circuit Court Magistrate William Dawkins (“Magistrate Dawkins”) met at a local bar, where they continued to drink alcohol. At around 3:00 a.m., the group walked to a strip club and tried to enter, but found that it was closed.

The group then walked to a nearby White Castle. While Magistrate Dawkins went inside, Respondents stood outside the restaurant. At around 3:17 a.m., Alfredo Vazquez and Brandon Kaiser drove past the group and shouted something out the window. Judge Bell extended her middle finger to Vazquez and Kaiser, who pulled into the White Castle parking lot and exited the vehicle. Judge Bell, who was intoxicated, has no memory of the incident but concedes that the security camera video shows her making this gesture.

A heated verbal altercation ensued, with all participants yelling, using profanity, and making dismissive, mocking, or insolent gestures toward the other group. At no time did Respondents move to another location in the parking lot to avoid a confrontation or de-escalate the conflict.

After a verbal exchange between Judge Bell and Vazquez, a physical confrontation ensued. At one point, Judge Jacobs had Kaiser contained on the ground. With his fist raised back, Judge Jacobs said, “Okay, okay, we’re done, we’re done,” or “This is over. Tell me this is over,” or words to that effect. At another point during the confrontation, Judge Adams kicked Kaiser in the back. The confrontation ended when Kaiser pulled out a gun, shot Judge Adams once, and shot Judge Jacobs twice.

Judge Adams and Judge Jacobs were transported to local hospitals for treatment of their serious injuries. Judge Adams, who sustained a single gunshot wound to the abdomen, had two emergency surgeries, including a colon resectioning. Judge Jacobs, who sustained two gunshot wounds to the chest, also had two emergency surgeries and was hospitalized for 14 days.

The opinion explains the reasoning for the suspensions as follows:

The Commission charges, and Respondents agree, that their respective conduct violated the following provisions of the Code of Judicial Conduct:

• Rule 1.2, requiring judges to act at all times in a manner that promotes public confidence in the integrity, independence, and impartiality of the judiciary; and

• Rule 3.1(C), prohibiting judges from participating in extrajudicial activities that would appear to a reasonable person to undermine the judge’s integrity, independence, or impartiality.

The Commission further charges, and Judge Adams agrees, that his conduct violated Rule 1.1 of the Code of Judicial Conduct, which requires a judge to respect and comply with the law.

Our legal system “is based upon the principle that an independent, impartial, and competent judiciary, composed of men and women of integrity, will interpret and apply the law that governs our society.” Ind. Code of Judicial Conduct, Preamble. The effectiveness of the judiciary ultimately rests on the trust and confidence that citizens confer on judges. Judges, therefore, must remain vigilant to guard against any actions that erode that public trust. Respondents’ alcohol-fueled actions during the early morning hours of May 1, 2019, fell far short of the Code’s directive to “aspire at all times to conduct that ensures the greatest possible public confidence in their independence, impartiality, integrity, and competence.” Id.

Respondents acknowledge that their misconduct damaged the public’s respect for and confidence in the integrity of the Indiana judiciary, both within the state and nationally. Their misconduct occurred while they were in Indianapolis for a statewide judicial educational event, and Judge Adams’s misconduct resulted in a criminal conviction.

The Conditional Agreements note, as mitigators, the following factors:

• Respondents have no prior disciplinary history as judges or as lawyers and this misconduct constitutes an isolated incident in their judicial careers;

• Respondents have accepted responsibility and expressed remorse for their conduct;

• Respondents have made efforts to address their behavior by contacting the Judges & Lawyers Assistance Program and by seeing counselors;

• Judge Adams and Judge Jacobs suffered serious physical injuries as a result of the altercation;

• After the physical altercation began, Judge Bell made several attempts to stop the fighting, including seeking help from those inside the White Castle by pounding on the door;

• Judge Bell immediately called 911 after shots were fired;

• Judge Adams and Judge Jacobs have been active leaders in their community; and

• Judge Adams and Judge Jacobs cooperated fully with the Commission and have been forthcoming about the incident.

“The purpose of judicial discipline is not primarily to punish a judge, but rather to preserve the integrity of and public confidence in the judicial system and, when necessary, safeguard the bench and public from those who are unfit.” In re Hawkins, 902 N.E.2d 231, 244 (Ind. 2009). The sanction must be designed to deter similar misconduct and assure the public that judicial misconduct will not be condoned. Id.

Comment: Judge Adams and Judge Jacobs were suspended for 60 days. Judge Bell was suspended for 30 days. The brawl would have gotten any judge or lawyer suspended. What made the incident much worse was the presence of a handgun and the bad decision to shoot the gun. Criminal charges remain pending against Kaiser and Vasquez.

Should A Lawyer Follow The Example of Alan Dershowitz In Responding to Allegations?

Retired Harvard Law Professor Alan Dershowitz has become embroiled in a public controversy and several lawsuits. Dershowitz represented Jeffrey Epstein and had a role in negotiating a deferred prosecution agreement tor Epstein.

Recently, one of Epstein’s accusers, who is represented by David Boies, has accused Dershowitz of inappropriate conduct. The full details of the allegations are contained in court papers in the case captioned Giuffre v. Dershowitz 19-cv-3377 (S.D. NY). There have been other lawsuits between and among Dershowitz and other lawyers who represented Giuffre or who objected to the extraordinarily lenient terms of the Epstein deferred prosecution agreement. The New Yorker recently ran a story detailing the controversy. Dershowitz has consistently denied the claims of Giuffre. Indeed, Dershowitz has denounced the allegations with such vigor that he has been sued for defamation at least twice, once by Giuffre and once by her former lawyers.

I not offering an opinion on the truth or falsity of the allegations that have been made. I’m more interested in the question of how a practicing lawyer should respond to allegations of this type.

I do not recommend that any lawyer respond to allegations in this manner. Instead, I strongly recommend that, when confronted with allegations of this nature, the lawyer respond to any media inquiries with a general denial (assuming the denial is true) and refusing any further comment. By commenting at length, there is some risk that the lawyer may inadvertently reveal a confidence of a client or make further errors. Each time the lawyer speaks he may contradict himself or offer a slightly different version of the events. In short, my advice is to shut up.

Lawyer is Reprimanded For False Statement In Motion for Extension of Time.

The case is In re Ryan Kenneth Melcher, 2018 PR 88. Melcher was employed as an assistant federal publid defender in the office of the Colorado federal defender. Melcher’s error was a mistatement of fact in a routine motion for extension of time. The Panel describes the error in this way;

2. In November 2016, Respondent was appointed to represent Rocky Allen (“Allen”) before the Tenth Circuit Court of Appeals (“Tenth Circuit”) in relation to Allen’s appeal of his 2016 federal criminal conviction for tampering with a consumer product and obtaining a controlled substance by deceit or subterfuge. The matter was captioned United States v. Rocky Allen under case number 16-1450.

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3. On April 26, 2017, while representing Allen, Respondent filed a motion in Allen’s matter before the Tenth Circuit entitled “Appellant’s Unopposed Motion for 14-Day Extension of Time to File Reply Brief.” In his motion, Respondent informed both the court and his opposing counsel at the U.S. Attorney’s Office for the District of Colorado that he had multiple matters scheduled for oral arguments, and needed additional time to prepare, and included the following information in his motion:

“I also have been working on the following cases with upcoming deadlines in this Court: United States v. Archuleta, No. 16-1297 (oral argument set for May 9, 2017); United States v. Ivory, No. 15-3238 (oral argument set for May 10, 2017); United States v. Olea-Monarez, No. 16-1330 (opening brief due May 15, 2017); United States v. Allen, No. 17-1083 (opening brief due June 5, 2017).”

4. In writing that another client’s matter in United States v. Ivory was set for oral argument on May 10, 2017, Respondent knowingly made a false statement to both the court and his opposing counsel as United States v. Ivory was not set for oral argument, which Respondent knew at the time he filed his motion.

When the mistake was recognized, it was quickly corrected. Despite the correction, the ARDC made a finding that the lawyer engaged in fraudulent conduct in violation of Rule 8.4(d).

5. By reason of the conduct described above, Respondent has engaged in the following misconduct:

a. knowingly making a false statement of fact or law to a tribunal, by filing a motion for extension of time and including language that he needed additional time to prepare for oral argument in United States v. Ivory when Respondent knew there was no oral argument pending in the Ivory matter, in violation of Rule 3.3(a)(1) of the Illinois Rules of Professional Conduct (2010);

b. knowingly making a false statement of material fact or law to a third person, by serving government counsel with a motion for extension of time in which Respondent wrote that he was preparing for oral argument in United States v. Ivory when the Ivory matter was not set for oral argument, in violation of Rule 4.1(a) of the Illinois Rules of Professional Conduct (2010); andc. engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation, by purposely including false language that United States v. Ivory was set for oral argument when Respondent knew there was no oral argument pending, in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010

The Panel acknowledges that the lawyer made only one false statement in the motion and that he recevied no personal benefit from that false statement. In addition, the respondent lost his job and has now been publicly embarrassed.

Comment: in my opinion this small error should have been dealt with by a private reprimand, not a public finding that the lawyer violated Rule 8.4(c). This is disciplinary overkill.

California Bar Seeks to Place Michael Avenatti on Inactive Status

The California Bar has filed a motion to place Michael Avenatti on inactive status. The Petition and Exhibits are over 500 pages long and list numerous claims that Avenatti converted funds belonging to his clients. http://www.calbar.ca.gov/About-Us/News-Events/News-Releases/state-bar-of-california-files-to-place-attorney-michael-j-avenatti-on-involuntary-inactive-status Given the allegations against Avenatti and the two pending federal indictments against him, I would imagine that the petition will be granted. That will remove Avenatti from the practice of law during the disciplinary case.

Oklahoma Imposes 90-day suspension for forging client’s name on settlement agreement.

A lawyer in Oklahoma forged his client’s signature on a settlement agreement and had that signature notarized. The Oklahoma Supreme Court described the misconduct as follows:

¶16 The formal release of claims against Pappy, et al. (excluding Barnes and Plaxico), was signed by Respondent (using Ms. Miller’s name) and the “signature” was caused to be notarized by Respondent on September 17, 2015. Respondent admits that he tried to replicate Ms. Miller’s signature as close as possible before having it notarized. Respondent also admits that he had no power of attorney or other legal authority authorizing him to sign this agreement using Ms. Miller’s name. However, Respondent alleges that he did have oral authorization to execute the formal release. However, Ms. Miller contended that she did not give Respondent permission to sign this formal release of claims against Pappy, et al….

¶25 Respondent’s actions were also a violation of ORPC Rules 8.4(a) and (c). The PRT Report found that Respondent violated Rule 8.4(c) when he endorsed the Formal Release of Claims for the Pappy, et al. settlement, signing his client’s name. Although he claimed that the signature was done with his client’s permission, she disputed that fact. But more seriously, he acknowledged that after he signed the settlement agreement, he caused that signature of his client’s name to be notarized, and by his admission, attempted to make the signature look as much as possible to the client’s signature. Though Respondent claimed to have had the client’s oral consent to effect the signature, his actions reveal that it was not, at the very least, in accord with legal procedures. He admitted that he no power of attorney or other legal authorization to sign his client’s name.

The Court also found that the respondent had mishandled settlement funds by depositing them in his operating account. (The client was made whole by the lawyer). The court also noted that the lawyer did a good job handling the case and obtained a substantial settlement for the client. Forging a client’s name on a document is usually cause for discipline. For further information please consult our website. https://www.clintonlaw.net/legal-ethics.html

The case is Oklahoma Bar Association v. Shad Withers, 2019 OK 47

Conversion of Client’s Money To Feed Gambling Habit Leads to Disbarment in Pennsylvania

The case is Office of Disciplinary Counsel v. John Kelvin Conner, 29 DB 2018. The case involved a lawyer who encourged a client to execute a durable power of attorney, naming the lawyer as the agent. The client was an elderly woman who needed round the clock healthcare. Instead of acting in the interest of the client, the lawyer withdrew over $95,000 from her account to feed a gambling habit. The Pennsylvania Supreme Court disbarred the lawyer.

ARDC Recommends 60-Day Suspension for False Statement In Motion

The ARDC Review Board has recommended a 60-day suspension for a lawyer who made a material misstatement in a motion to vacate a conviction. In Illinois an old conviction, even if you have led a blameless life, can lead to dire consequences because you are forever barred from holding any professional license – even one to cut hair. This harsh rule has been criticized and challenged but it has stood the test of time. Here a lawyer made a false statement in a motion to vacate a conviction and the Review Board has recommended a 60-day suspension.

In March 2017, Respondent agreed to represent Courtney Chester in an effort to have her 2001 battery conviction voided so that she could apply to nursing school. Chester was 17 when she was charged with battery, but she had turned 18 on the day before she pled guilty to the charge. Thus, she was 18 at the time of her guilty plea and conviction. Respondent knew she was 18 when she pled guilty.

“Respondent began conversations with Assistant States Attorney Joseph Lesner about Chester’s situation. Lesner told him to get a motion on file. Respondent thus prepared and filed with the court a motion to vacate Chester’s guilty plea and conviction. In the motion, Respondent stated that Chester was 17 at the time she was charged and sentenced. He further stated: “As [Chester] was only 17 at the time of the plea and conviction[,] her plea and conviction should properly be voided.” (Admin. Ex. 1 at 5.) He knew that statement was false when he filed the motion, because he knew that Chester was 18 when she entered her guilty plea and was sentenced.

Respondent also sent a cover letter to Lesner explaining the motion, in which he stated that Chester was “trying to become a nurse and to do so she needs to remove her conviction for battery in 2001. She was 17 at the time and was eligible for court supervision.” (Admin. Ex. 1 at 6.)

About a month after filing the motion, Respondent appeared in court on the motion to vacate, in front of Winnebago County Circuit Court Associate Judge Brian Shore. Judge Shore questioned him about the basis of the motion, pointing out that Chester was 18 

when she pled guilty and that the motion, on its face, was not correct. Respondent told Judge Shore that he did not look at the actual plea date and that, when he wrote the motion, he believed Chester was 17 at the time of her plea, but subsequently determined that she was over that age. The judge continued to press Respondent about the incorrect statement, and Respondent continued to assert to the judge that he did not intend to state something false. The judge dismissed the motion to vacate because of the “blatantly false allegation.” (Admin. Ex. 3 at 3-8.) At his disciplinary hearing, Respondent acknowledged that his statements to Judge Shore that he did not look at the actual plea date and that he believed when he wrote the motion that Chester was 17 when she pled guilty were false. (Report of Proceedings at 34-35.)”

If you have a legal ethics issue and would like to discuss it with us, do not hesitate to contact us. Also, please review our legal ethics webpage. https://www.clintonlaw.net/legal-ethics.html

The Journey Begins

Thanks for joining me! I recently moved my legal ethics blog to wordpress from Blogger. We will see how this works.

This blog typically covers legal ethics issues and disciplinary cases of note.

The new format of WordPress will take me some time to learn.

Ed Clinton

Good company in a journey makes the way seem shorter. — Izaak Walton