Case Number(s): 08-O-10732, 08-O-11543, 08-C-11120
In the Matter of: Daniel Edouard Chien, Bar # 190061, A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Jean Cha, Deputy Trial Counsel
1149 S. Hill Street
Los Angeles, CA 90015
(213) 765-1000
Bar # 228137,
Counsel for Respondent: Arthur Margolis, Margolis & Margolis LLP
2000 Riverside Drive
Los Angeles, CA 90039
(323) 953-8996
Bar # 57703,
Submitted to: Assigned Judge – State Bar Court Clerk’s Office Los Angeles.
<<not>> checked. PREVIOUS STIPULATION REJECTED
Note: All information required by this form and any additional information which cannot be provided in the space provided, must be set forth in an attachment to this stipulation under specific headings, e.g., "Facts," "Dismissals," "Conclusions of Law," "Supporting Authority," etc.
1. Respondent is a member of the State Bar of California, admitted November 25, 1997.
2. The parties agree to be bound by the factual stipulations contained herein even if conclusions of law or disposition are rejected or changed by the Supreme Court.
3. All investigations or proceedings listed by case number in the caption of this stipulation are entirely resolved by this stipulation and are deemed consolidated. Dismissed charge(s)/count(s) are listed under "Dismissals." The stipulation consists of 14 pages, not including the order.
4. A statement of acts or omissions acknowledged by Respondent as cause or causes for discipline is included under "Facts."
5. Conclusions of law, drawn from and specifically referring to the facts are also included under "Conclusions of Law".
6. The parties must include supporting authority for the recommended level of discipline under the heading "Supporting Authority."
7. No more than 30 days prior to the filing of this stipulation, Respondent has been advised in writing of any pending investigation/proceeding not resolved by this stipulation, except for criminal investigations.
8. Payment of Disciplinary Costs-Respondent acknowledges the provisions of Bus. & Prof. Code §§6086.10 & 6140.7. (Check one option only):
<<not>> checked. Until costs are paid in full, Respondent will remain actually suspended from the practice of law unless relief is obtained per rule 5.130, Rules of Procedure.
checked. Costs are to be paid in equal amounts prior to February 1 for the following membership years: Cost to be paid in equal amounts prior to February 1 for the following three (3) billing cycles following the effective date of the Supreme Court order. (Hardship, special circumstances or other good cause per rule 5.132, Rules of Procedure.) If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
<<not>> checked. Costs are waived in part as set forth in a separate attachment entitled "Partial Waiver of Costs".
<<not>> checked. Costs are entirely waived.
Respondent has been an effective contributor in his community through voluntarism. In December 2006, Respondent traveled to New Orleans to assist with the post-Katrina effort. He worked at the Musician’s Village under Habitat for Humanity and assisted in building new homes. For the past three years, Respondent has assisted the Women’s Cancer Research Foundation in fundraising activities. In 2009, Respondent served on the panel for Cal Alumni Scholarship intervies for incoming freshman to the University of California. Respondent regularly participates in feeding the homeless and the Boys’ Hope/Girls’ Hope charity.
IN THE MATTER OF: Daniel Edouard Chien, State Bar No. 190061
STATE BAR COURT CASE NUMBER: 08-O-10732, 08-O-11543, 08-C-1120
Respondent Daniel Chien, admits the facts set forth in the stipulation are true and that he is culpable of violations of the specified statutes and Rules of Professional Conduct.
Case Number 08-0-10732 Ayala Matter
FACTS
1. In May 2004, Carlos Ayala ("Ayala") employed Respondent to represent him in a personal injury matter on a contingency basis arising out of an auto accident which occurred on January 7, 2004.
2. On August 5, 2004 Respondent opened a client trust account with Uniti Bank, account number ending in 0023 (the "Uniti CTA").
3. In April 2005, Respondent, with Ayala’s consent, settled Ayala’s personal injury claim with Lincoln General Insurance Company ("LGI") for $5,500.00. Respondent provided LGI with a release signed by Ayala and dated May 10, 2005.
4. On May 25, 2005, Respondent deposited the settlement draft check dated May 13, 2005, payable to "Chien & Associates & Their Client Carlos Ayala," check number 0214187 in the amount of $5,500.00 into his Uniti CTA. As of May 25, 2005, Respondent’s Uniti CTA balance was $23,591.87.
5. On July 19, 2005, Respondent provided Ayala with a contingency-fee settlement disbursement sheet that purported to show that $1,834.00 was withheld for attorney fees, the chiropractor was paid $1,833.00 and that Ayala would receive $1,833.00.
6. On July 19, 2005, Ayala picked up Uniti CTA check number 11366 made payable to Carlos Ayala in the amount of $1,833.00 and unsuccessfully attempted to negotiate Uniti CTA check number 11366. On August 8, 2005, although there were sufficient funds in Respondent’s account, the check did not clear and thereafter Ayala did not present the check for payment again.
7. In July 2005, Respondent failed to closely supervise an employee, Jae Chang, in the handling of the trust account. And his failure to closely supervise, allowed Chang to mishandle the funds. As a consequence, Respondent did not disburse funds to the chiropractor in the amount of $1,833.00 on Ayala’s behalf. From May 25, 2005 to October 2010, Respondent was required to maintain $3,666.00 in his Uniti CTA on behalf of Ayala.
8. On August 30, 2007, Respondent closed his Uniti CTA, when the remaining balance was $2,543.62, without disbursing any of the funds to Ayala or to anyone on his behalf.
9. In October 2010, Respondent made full restitution to Ayala in the amount of $5,556.00.
CONCLUSION OF LAW
10. Respondent failed to maintain $3,666.00 in his Uniti CTA in wilful violation of Rules of Professional Conduct, rule 4-100(A), by failing to maintain the balance of funds received for the benefit of a client and deposited in a bank account labeled "Trust Account."
Case Number 08-0-11543 Sawyer Matter
FACTS
11. In May 2004, Chris Sawyer ("Sawyer") employed Respondent to represent him in a personal injury matter on a contingency basis arising out of an auto accident which occurred on January 7, 2004.
12. On November 17, 2003, Respondent opened a client trust account with Hanmi Bank, account number ending in 0034 (the "Hanmi CTA").
13. In August 2004, Respondent settled Sawyer’s personal injury claim with Lincoln General Insurance Company ("LGI") for $4,500.00.
14. On August 23, 2004, LGI issued settlement check number 0176170 payable to "Chien & Associates & Their Client Chris Sawyer," in the amount of $4,500.00.
15. On August 25, 2004, Respondent deposited the LGI settlement check into his Hanmi CTA. As of August 25, 2004, Respondent’s Hanmi CTA balance was $13,636.54.
16. On September 7, 2004, Respondent provided Sawyer with a contingency fee settlement disbursement sheet that purported to show $1,500.00 was withheld for attorney fees, $200.00 was withheld for investigative costs, $1,300 would go to Sawyer, and $1,500.00 was withheld for the chiropractor.
17. On September 7, 2004, Sawyer picked up Hanmi CTA check number 10589 made payable to Sawyer in the amount of $1,300.00. Sawyer deposited check number 10589 into his personal account on September 8, 2004.
18. In October 2004, Respondent failed to closely supervise an employee, Jae Chang, in the handling of the trust account. And his failure to closely supervise, allowed Chang to mishandle the funds. As a consequence, Respondent did not to disburse $1,500.00 to the chiropractor on Sawyer’s behalf and therefore, from August 25, 2004 to November 2010, Respondent was required to maintain $1,500.00 in his Hanmi CTA.
19. On October 4, 2004, Respondent closed his Hanmi CTA when the remaining balance was $140.24 without disbursing any funds to Sawyer or to anyone on his behalf.
20. In November 2010, Respondent made full restitution to Sawyer.
CONCLUSION OF LAW
21. Respondent failed to maintain $1,500.00 in his Hanmi CTA in wilful violation of Rules of Professional Conduct, rule 4-100(A), by failing to maintain the balance of funds received for the benefit of a client and deposited in a bank account labeled "Trust Account."
Case Number 08-C-11120 Conviction Referral Matter
FACTS
22. On July 30, 2009, Respondent was convicted in a matter entitled State v. Daniel Chien, Los Angeles County Superior Court Case Number BA336892, for a violation of Insurance Code § 750(a) - unlawful offer or receipt of consideration for referral of clients, one count misdemeanor.
23. On April 23, 2010, the Review Department filed an order referring the matter to the hearing department for a determination of whether the conviction, a violation of Insurance Code § 750(a) (capping) involved moral turpitude or other misconduct warranting discipline.
24. In 2002, Respondent opened a satellite office in Los Angeles. Respondent split his time between his already existing office in Irvine and the Los Angeles office. In so doing, Respondent failed to adequately supervise his staff in the Los Angeles office.
25. Respondent’s involvement was limited to his failure to supervise a rogue employee who engaged in unlawful behavior by paying for the referral to the firm of a personal injury case. Due to Respondent’s negligent failure to closely supervise the employee during the period from September 2002 through November 2003, Respondent did not detect the employee’s unlawful behavior. Respondent’s conduct and level of participation in regard to the facts and circumstances surrounding the conviction did not include moral turpitude per se but did involve other misconduct warranting discipline.
SUPPORTING AUTHORITY
The purpose of State Bar disciplinary proceedings is not to punish the attorney, but to protect the public, to preserve public confidence in the profession, and to maintain the highest possible professional standards for attorneys. (Chadwick v. State Bar (1989) 49 Cal.3d 103, 111; Cooper v. State Bar (1987) 43 Cal.3d 1016, 1025; Std. 1.3.)
Standard 2.2(b) of the Standards for Attorney Sanctions for Professional Misconduct, Rules Proc. Of State Bar, Title IV, provides that a violation of rule 4-100 shall result in at least a three-month suspension, irrespective of mitigation circumstances.
Standard 3.4 provides for a sanction that is proportionate to the conviction.
Standard 1.7(b) provides for disbarment unless the most compelling mitigating circumstances clearly predominate.
The standards are guidelines (Drociak v. State Bar (1991) 52 Cal.3d 1085, 1090; In the Matter of Koehler (Review Dept. 1991) 1 Cal. State Bar Ct. Rptr. 615,628) and afforded great weight (In re Silverton (2005) 36 Cal.4th 81, 91-92), but they are not applied in a talismanic fashion (In the Matter of Van Sickle (Review Dept. 2006) 4 Cal. State Bar Ct. Rptr. 980, 994).
Case law supports a range of 6 months actual suspension (In the Matter of Duxbury (Review Dept. 1999) 4 Cal. State Bar Ct. Rptr. 67) to disbarment where moral turpitude is found for a misdemeanor capping violation (Kitsis v. State Bar, 23 Cal.3d 857).
The misconduct in the conviction referral matter and the majority of the misconduct in the two client matters overlaps in time with the misconduct in Respondent’s prior disciplinary proceeding. (In the Matter of Sklar (Review Dept. 1993) 2 Cal.State Bar Ct. Rptr. 602.)
In review of the chronology of events, (In the Matter of Hagen (Review Dept. 1992) 2 Cal. State Bar Ct. Rptr. 153, 171; In the Matter of Miller (Review Dept. 1990) 1 Cal. State Bar Ct. Rptr. 131, 136) nature and extent of the facts and circumstances surrounding the misconduct and balancing the compelling mitigation with aggravation, two years actual suspension is adequate to satisfy the purposes of attorney discipline. (Std. 1.6(b); Segal v. State Bar (1988) 44 Cal.3d 1077, 1089; Snyder v. State Bar (1990) 49 Cal.3d 1302, 1310-1311.)
PENDING PROCEEDINGS.
The disclosure date referred to, on page one, paragraph A.(7), was October 22, 2010.
COSTS OF DISCIPLINARY PROCEEDINGS.
Respondent acknowledges that the Office of the Chief Trial Counsel has informed Respondent that as of October 22, 2010, the estimated prosecution costs in this matter are approximately $2,955.00. Respondent acknowledges that this figure is an estimate only and that it might not include State Bar Court costs that will be included in any final cost assessment (see Bus. & Prof. Code section 6068.10(c)) or taxable costs (see C.C.P. section 1033.5(a)). Should this stipulation be rejected or relief from the stipulation be granted, the costs in this matter may increase due to further proceedings. If Respondent fails to pay any installment of disciplinary costs within the time provided herein or as may be modified by the State Bar Court pursuant to section 6086.10, subdivision (c), the remaining balance of the costs is due and payable immediately unless relief has been granted under the Rules of Procedure of the State Bar of California (Rules Proc. of State Bar, rule 286). The payment of costs is enforceable both as provided in Business and Professions Code section 6140.7 and as a money judgment.
STATE BAR ETHICS SCHOOL.
Because Respondent has agreed to attend State Bar Ethics School as part of this stipulation, Respondent will receive Minimum Continuing Legal Education credit upon the satisfactory completion of State Bar Ethics School.
Case Number(s): 08-O-10732, 08-O-11543 & 08-C-11120
In the Matter of: Daniel Edouard Chien
a. Restitution
<<not>> checked. Respondent must pay restitution (including the principal amount, plus interest of 10% per annum) to the payee(s) listed below. If the Client Security Fund (“CSF”) has reimbursed one or more of the payee(s) for all or any portion of the principal amount(s) listed below, Respondent must also pay restitution to CSF in the amount(s) paid, plus applicable interest and costs.
1. Payee:
Principal Amount:
Interest Accrues From:
2. Payee:
Principal Amount:
Interest Accrues From:
3. Payee:
Principal Amount:
Interest Accrues From:
4. Payee:
Principal Amount:
Interest Accrues From:
<<not>> checked. Respondent must pay above-referenced restitution and provide satisfactory proof of payment to the Office of Probation not later than .
<<not>> checked. Respondent must pay the above-referenced restitution on the payment schedule set forth below. Respondent must provide satisfactory proof of payment to the Office of Probation with each quarterly probation report, or as otherwise directed by the Office of Probation. No later than 30 days prior to the expiration of the period of probation (or period of reproval), Respondent must make any necessary final payment(s) in order to complete the payment of restitution, including interest, in full.
1. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
2. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
3. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
4. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
<<not>> checked. If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
checked.
1. If Respondent possesses client funds at any time during the period covered by a required quarterly report, Respondent must file with each required report a certificate from Respondent and/or a certified public accountant or other financial professional approved by the Office of Probation, certifying that:
a. Respondent has maintained a bank account in a bank authorized to do business in the State of California, at a branch located within the State of California, and that such account is designated as a “Trust Account” or “Clients’ Funds Account”;
b. Respondent has kept and maintained the following:
i. A written ledger for each client on whose behalf funds are held that sets forth:
1. the name of such client;
2. the date, amount and source of all funds received on behalf of such client;
3. the date, amount, payee and purpose of each disbursement made on behalf of such client; and,
4. the current balance for such client.
ii. a written journal for each client trust fund account that sets forth:
1. the name of such account;
2. the date, amount and client affected by each debit and credit; and,
3. the current balance in such account.
iii. all bank statements and cancelled checks for each client trust account; and,
iv. each monthly reconciliation (balancing) of (i), (ii), and (iii), above, and if there are any differences between the monthly total balances reflected in (i), (ii), and (iii), above, the reasons for the differences.
c. Respondent has maintained a written journal of securities or other properties held for clients that specifies:
i. each item of security and property held;
ii. the person on whose behalf the security or property is held;
iii. the date of receipt of the security or property;
iv. the date of distribution of the security or property; and,
v. the person to whom the security or property was distributed.
2. If Respondent does not possess any client funds, property or securities during the entire period covered by a report, Respondent must so state under penalty of perjury in the report filed with the Office of Probation for that reporting period. In this circumstance, Respondent need not file the accountant’s certificate described above.
3. The requirements of this condition are in addition to those set forth in rule 4-100, Rules of Professional Conduct.
checked. Within one (1) year of the effective date of the discipline herein, Respondent must supply to the Office of Probation satisfactory proof of attendance at a session of the Ethics School Client Trust Accounting School, within the same period of time, and passage of the test given at the end of that session.
Case Number(s): 08-O-10732, 08-O-11543 & 08-C-11120
In the Matter of: Daniel Edouard Chien
By their signatures below, the parties and their counsel, as applicable, signify their agreement with each of the recitation and each of the terms and conditions of this Stipulation Re Facts, Conclusions of Law and Disposition.
Signed by:
Respondent: Daniel Chien
Date: November 3, 2010
Respondent’s Counsel: Arthur Margolis
Date: November 4, 2010
Deputy Trial Counsel: Jean Cha
Date: November 4, 2010
Case Number(s): 08-O-10732, 08-O-11543 & 08-C-11120
In the Matter of: Daniel Edouard Chien
Finding the stipulation to be fair to the parties and that it adequately protects the public, IT IS ORDERED that the requested dismissal of counts/charges, if any is GRANTED without prejudice, and:
checked. The stipulated facts and disposition are APPROVED and the DISCIPLINE RECOMMENDED to the Supreme Court.
<<not>> checked. The stipulated facts and disposition are APPROVED AS MODIFIED as set forth below, and the DISCIPLINE IS RECOMMENDED to the Supreme Court.
checked. All Hearing dates are vacated.
The parties are bound by the stipulation as approved unless: 1) a motion to withdraw or modify the stipulation, filed within 15 days after service of this order, is granted; or 2) this court modifies or further modifies the approved stipulation. (See rule 135(b), Rules of Procedure.) The effective date of this disposition is the effective date of the Supreme Court order herein, normally 30 days after the file date. (See rule 9.18(a), California Rules of Court.)
Signed by:
Judge of the State Bar Court: Richard A. Honn
Date: November 29, 2010
[Rules Proc. of State Bar; Rule 5.27(B); Code Civ. Proc., § 1013a(4)]
I am a Case Administrator of the State Bar Court of California. I am over the age of eighteen and not a party to the within proceeding. Pursuant to standard court practice, in the City and
County of Los Angeles, on November 29, 2010, I deposited a true copy of the following document(s):
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION AND ORDER APPROVING
in a sealed envelope for collection and mailing on that date as follows:
checked. by first-class mail, with postage thereon fully prepaid, through the United States Postal Service at Los Angeles, California, addressed as follows:
ARTHUR L MARGOLIS ESQ
MARGOLIS & MARGOLIS LLP
2000 RIVERSIDE DR
LOS ANGELES, CA 90039
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
Jean H. Cha, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles, California, on November 29, 2010.
Signed by:
Julieta E. Gonzales
Case Administrator
State Bar Court