Case Number(s): 08-O-14710, 09-O-10094, 09-O-10096, 09-O-10133, 09-O-10416, 09-O-10465, 09-O-10922, 09-O-11190, 09-O-11192, 09-O-11293, 09-O-11440, 09-O-11724, 09-O-12730, 09-O-14085, 09-O-15136, 10-O-03433
In the Matter of: Jay Michael Tenenbaum, Bar # 134221, A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Erin McKeown Joyce, Deputy Trial Counsel
State Bar of California
1149 South Hill Street
Los Angeles, CA 90015-2299
Telephone: (213) 765 - 1356
Facsimile: (213) 765-1319
Bar # 149946,
Counsel for Respondent: Edward O. Lear, Century Law Group LLP
5200 West Century Blvd., #345
Los Angeles, CA 90045
Telephone: (310) 642-6900
Facsimile: (310) 642-6910
Bar# 132699
Submitted to: Settlement 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 June 14, 1988.
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 37 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: two years following the effective date of the Supreme Court order of discipline. (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.
The Attachment to the Stipulation re Facts, Conclusion of Law and Disposition comprises pages 9 to 36.
Case Number(s): 08-O-14710, 09-O-10094, 09-O-10096, 09-O-10133, 09-O-10416, 09-O-10465, 09-O-10922, 09-O-11190, 09-O-11192, 09-O-11293, 09-O-11440, 09-O-11724, 09-O-12730, 09-O-14085, 09-O-15136, 10-O-03433
In the Matter of: Jay Michael Tenenbaum
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.
<<not>> 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.
The disclosure date referred to, on page two, paragraph A.(7), was December 3, 2010.
Respondent admits that the following facts are true and that he is culpable of violations of the specified Rules of Professional Conduct and Business and Professions Code sections.
General Facts Applicable to All Matters
1. Respondent and his wife/law partner operated a law practice entitled Seals & Tenenbaum ("S&T") from 1990 until November 2008.
2. Respondent was the managing partner of S&T. Respondent had primary responsibility for overseeing the administrative side of their joint practice and reconciling the firm’s business accounts.
3. Respondent’s wife/law partner did not personally handle, reconcile or review the statements, ledgers or payment histories related to any of the matters assigned to S&T. All administrative duties were entrusted to Respondent.
4. Up until 2008, S&T experienced no problems related to its administration or financial accounts. During the entire time period form 1990 when S&T was formed, up to 2008, Respondent was responsible for the administration of the firm.
5. In late 2007, Respondent’s wife/law partner became debilitated by her Hepetitis C condition which exacerbated her difficult, high-risk pregnancy with their now two and one-half year old twins.
6. Respondent’s wife/law partner was unable to work in the office, and Respondent was forced to take on her work at S&T.
7. Respondent was distracted from his administrative duties at S&T, due to his commitment to cover for his wife/law partner’s absence from the office and the consequent increase of his workload.
8. These circumstances afforded S&T’s long-time office manager/bookkeeper the opportunity to misuse the firm’s accounts without detection for a significant period of time.
9. Respondent and his wife/law partner invested over $525,000 of their own funds to cover the unexplained shortfalls in the firm’s accounts in 2008.
10. Respondent and his wife/law partner closed S&T in November 2008, when they were unable to continue to pay for the firm’s expenses.
11. At that time, Respondent and his wife/law partner discovered their trusted office manager/bookkeeper’s misuse of the firm’s accounts.
Case No. 08-O-14710
FACTS:
Respondent was hired by H&K, LLC ("H&K"), through H&K principal Jeffrey Berenholz, for several collection matters, including the accounts of debtors Dennis Williamson, David Good, Maria Magallanes-Lupian, Rebecca Tate-Lacroix and George Thomas.
Dennis Williamson Matter
1. On May 6, 2008, Berenholz forwarded the collections matter to Respondent to collect a debt owed by Dennis Williamson.
2. On June 10, 2008, Respondent sent a letter to Berenholz requesting $450.00 in advanced costs for court filing fees for the Williamson matter.
3. On August 22, 2008, H&K sent check no. 196669 for $450.00 to Respondent.
4. On August 28, 2008, Respondent received and deposited the $450.00 check into a trust account Respondent maintained at CalNational Bank, CalNational Bank account xxxxx7006 (the "CalNational cost account").
5. On October 8, 2008, Respondent filed a suit in Riverside Superior Court entitled Hudson v. Williamson, case no. CIVVS806156. The cost to file the complaint was $195.00. Respondent filed no other documents and incurred no other costs related to the Williamson matter.
6. On November 14, 2008, Respondent closed his law firm and did not return the unused advanced costs of $255.00 to Berenholz.
7. Respondent failed to maintain the unused advanced costs in a trust account.
David Good Matter
8. On March 4, 2008, Berenholz forwarded the collections matter to Respondent to collect a debt owed by David Good.
9. On May 29, 2008, Respondent notified Berenholz that he would need $375.00 in advanced costs for the filing fee.
10. On August 22, 2008, H&K sent check no. 196657 for $375.00 to Respondent.
11. On August 28, 2008, Respondent deposited the check into his CalNational cost account.
12. After receiving the funds, Respondent did not file a lawsuit in the David Good matter and did not return the unused advanced costs. The balance in the CalNational trust account went to zero by the end of November 2008,
13. Respondent failed to maintain the unused advanced costs in a trust account. Maria
Maria Magallanes-Lupian Matter
14. On June 9, 2008, Berenholz forwarded the collections matter to Respondent to collect a debt owed by Maria Magallanes-Lupian.
15. On July 29, 2008, Respondent notified Berenholz that the statute of limitations was set to run on July 30, 2008, and that Berenholz needed to send $450.00 to file the lawsuit.
16. On July 30, 2008, Berenholz sent $450.00 to Respondent.
17. On August 4, 2008, Respondent deposited the cost check into his CalNational cost account.
18. On August 5, 2008, Respondent notified Berenholz stating that the suit was not filed because the statute had run. Respondent closed his file.
19. On August 8, 2008, Berenholz requested the return of $450.00 advanced costs since the lawsuit was not filed. Respondent did not return the unused advanced costs to H&K.
20. Respondent failed to maintain the unused advanced costs in a trust account.
Rebecca Tate-Lacroix Matter
21. On April 2, 2008, Berenholz forwarded the collections matter to Respondent to collect a debt owed by Rebecca Tate-Lacroix.
22. On May 8, 2008, Respondent requested Berenholz provide a check for costs in the amount of $375.00.
23. On May 16, 2008, Berenholz sent $375.00 to Respondent.
24. On May 19, 2008, Respondent filed a lawsuit in Los Angeles Superior Court. H&K v Tate-Lacroix, case no. 08B02583.
25. On May 23, 2008, Respondent deposited the check into his CalNational cost account.
26. Respondent only used $40.00 to file the suit and $38.00 for service. Respondent failed to return the outstanding $270.00 in unused advanced costs to Berenholz.
27. Respondent failed to maintain the unused advanced costs in a trust account.
George Thomas Matter
28. Respondent filed a lawsuit on behalf of H&K against George Thomas. Pursuant to the retainer agreement with H&K, Respondent was entitled to collect a 25% contingency fee from the proceeds of any judgment or settlement he collected on behalf of H&K.
29. On May 10, 2005, a judgment for H&K was entered in the amount of $7,036.53.
30. On January 5, 2007, the debtor sent a check to Respondent for $8,477.65 to pay off the judgment.
31. On January 8, 2007, Respondent received the debtor’s check for $8,477.65.
32. At no time after receiving the debtor’s check did Respondent remit any of the funds to H&K. Respondent owed H&K 75% of the payment from the debtor, or $6,358.24.
33. Respondent failed to maintain the funds owed to H&K for its portion of the Thomas judgment in a trust account.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs and the portion of the Thomas settlement owed to H&K in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to H&K the unused advanced costs and H&K’s portion of the Thomas judgment to H&K, as requested by the client, Respondent failed to promptly pay to H&K any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10094
FACTS
1. Respondent maintained a Client Trust Account ("CTA") at California National Bank ("CalNational"), account no. xxxxxx8426 (the "CalNational client trust account").
2. On January 26, 2007, Eckert & Associates retained Respondent to handle a collection case (the "Eckert matter"). Pursuant to the retainer agreement with Eckert, Respondent was to receive 35% of all monies collected from the debtor after unused costs were reimbursed to Eckert’s client.
3. In December 2007, Respondent contacted Eckert stating that the debtor’s attorney offered $9,624.70, or 58% of the outstanding debt, to settle the Eckert collection matter. Eckert approved the potential settlement. Respondent settled the Eckert collection matter for $9,624.70.
4. On December 28, 2007, Respondent deposited $9,624.70 into the CalNational client trust account.
5. On January 30, 2008, Respondent remitted $6,222.80 to Eckert and enclosed an accounting. Although Respondent received $9,624.70 from the debtor, the accounting stated that Respondent had collected only $8,297.17. The accounting stated that Respondent’s contingency fee was $2,074.29, the remittance being the difference, $6,222.80.
6. In late October 2008, Eckert received an anonymous tip about the discrepancy in the amount of the settlement in the Eckert collection matter.
7. Eckert conducted an in-house audit and obtained a copy of the debtor’s agreement, and settlement check stating the actual settlement amount of $9,624.70.
8. Eckert then faxed Respondent a letter requesting an explanation of the discrepancy.
9. On November 10, 2008, nearly a year after the account settled, Respondent sent Eckert the difference in the settlement, $995.68.
CONCLUSIONS OF LAW
By delaying payment to Eckert of the full amount due from the settlement of the Eckert matter until November 2008, Respondent failed to promptly pay, as requested by the client, any funds in the possession of the member which the client was entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10096
FACTS
1. On March 25, 2010, Respondent was hired by Receivables Control Corporation, LLC ("RCC") to collect a $48,000 debt from debtor Larry Lanzrath d/b/a American Investment Exchange ("Lanzrath"). Respondent’s engagement letter provided for payment of $950.00 in advanced fees to Respondent and a 15% contingency fee.
2. On October 15, 2008, Respondent faxed RCC the Settlement Agreement and Mutual Release in the amount of $32,500.00. Respondent handwrote a rough accounting and circled $27,625.00, the amount to be paid out to RCC.
3. On October 17, 2008, Respondent received a wire transfer of $32,500.00 from Lanzrath into his CalNational client trust account.
4. Respondent did not notify RCC of receipt of the funds and did not pay out any funds to RCC.
5. In November 2008, a representative from RCC visited Respondent and inquired about the status of RCC’s portion of the settlement proceeds of the Lanzrath settlement, which totaled $27,625.00. Respondent told the RCC representative that he no longer had any money to pay RCC.
6. In December 2008, the balance in Respondent’s CalNational client trust account fell below the amount owed to RCC. Respondent eventually closed the account with a zero balance by the end of December 2008. Respondent did not pay out to RCC the funds owed to RCC.
CONCLUSIONS OF LAW
By failing to pay out to RCC its portion of the Lanzrath settlement in the amount of $27,625.00, Respondent failed to promptly pay, as requested by the client, any funds in the possession of the member which the client was entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10133
FACTS
1. On March 3, 2007, Johnson & Rountree ("J&R") hired Respondent to handle a collection matter. Pursuant to the retainer agreement with J&R, Respondent was entitled to receive a 25% contingency on all debts collected on J&R matters.
2. On September 11, 2007, Respondent filed a collections case suit entitled St. Paul Fire & Marine Insurance v. Jessica Garcia, in Los Angeles Superior Court, case no. 07A04681 (the "Garcia matter").
3. On January 11, 2008, Stuart Allan & Associates ("Allan") purchased J&R, and became Respondent’s client for purposes of the Garcia matter.
4. On September 2, 2008, the court entered a default judgment in the principal amount of $21,293.07, $4,622.63 in interest, and $370.00 in costs. Since the judgment was a "no-asset" judgment, Allan instructed Respondent to contact Allstate Insurance to settle the claim against Garcia. Garcia had filed the personal injury claim with Allstate Insurance.
5. On September 30, 2008, Respondent reached a settlement with Allstate Insurance in the Garcia matter in the amount of $4,250.00. Allstate mailed the settlement draft of 4,250.00 to Respondent.
6. On October 1, 2008, Respondent deposited the $4,250.00 draft into his CalNational client trust account.
7. Pursuant to his agreement with J&R, Respondent owed Allan $3,187.50 from the Garcia settlement. Respondent did not pay out any monies in the Garcia matter to Allan.
CONCLUSIONS OF LAW
By failing to pay out to Allan its portion of the Garcia settlement in the amount of $3,187.50, Respondent failed to promptly pay, as requested by the client, any funds in the possession of the member which the client was entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10416
1. On June 6, 2008, Respondent was hired by Alan Tabrizi ("Tabrizi"), on behalf of Raider Painting, for a collection matter against Scott Thomas Construction (the "Thomas matter"). Pursuant to the retainer agreement, Respondent was entitled to a 25% contingency fee and an advanced litigation cost deposit of $450.00.
2. On June 10, 2008, Respondent filed a civil complaint in Riverside Superior Court entitled Tabrizi Inc. v. Scott Thomas Construction, case no. RIC501323.
3. On August 22, 2008, Respondent received and deposited the debtor’s check for $7,018.50. Respondent deposited the settlement check into his CalNational trust account.
4. Respondent did not pay out any of the settlement proceeds from the Thomas settlement to Tabrizi, even though Tabrizi was owed $5,263.86.
CONCLUSIONS OF LAW
By failing to pay out to Tabrizi his portion of the Thomas settlement in the amount of $5,263.86, Respondent failed to promptly pay, as requested by the client, any funds in the possession of the member which the client was entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10465,
FACTS
On April 8, 2008, attorney Paul Kemeness, on behalf of his client Stag Parkway, Inc. ("Stag"), contacted Respondent for two collection matters.
Adventure RV Matter
1. Respondent was first hired on April 8, 2008 to pursue a collection matter against debtor Adventure RV, who owed $15,099.59 plus attorney fees and costs to Stag (the "Adventure RV matter"). Pursuant to the retainer agreement with Kemeness, Respondent was entitled to a 33.3% contingency fee of collections received, with the client responsible to pay litigation costs.
2. On April 14, 2008, Respondent sent a letter acknowledging receipt of the matter. Respondent stated that he would notify Kemeness the status of the matter in the next 30 to 45 days, if not earlier.
3. On April 21, 2008, Kemeness requested that Respondent cease collection activity on the Adventure RV matter. Then on August 20, 2008, Kemeness requested that Respondent reopen the case. At that point, the debtor Adventure RV owed $11,743.06.
4. On October 14, 2008, Respondent received a check for $1,000.00 from Adventure RV dated October 13, 2008. Respondent then deposited the check into his CalNational client trust account that same day.
5. Respondent never notified Kemeness that he received and deposited the Adventure RV check. Respondent did not pay out any monies from the Adventure RV check to Kemeness, although Kemeness was entitled to receive $670.00 from the Adventure RV check.
RV Super Center Matter
6. On October 23, 2008, Kemeness sent a letter to Respondent regarding a new collection matter. In the new case the debtor, RV Super Center, owed $65,314.72 plus attorney fees and costs. This time, pursuant to the retainer agreement with Kemeness, Respondent was entitled to receive a 25% contingency fee. Kemeness requested that Respondent file a claim immediately.
7. On October 31, 2008, Respondent sent a letter acknowledging receipt of the new matter and stated that he would notify Kemeness the status in the next 30 to 45 days.
8. On November 3, 2008, Respondent sent a letter to the debtor RV Super Center, confirming that Kemeness would accept the sum of $20,000.00 as settlement in full.
9. On November 11, 2008, Respondent received a $5,000.00 payment from the debtor RV Super Center.
10. On November 13, 2008, Respondent deposited the check into his CalNational client trust account. At no time did Respondent notify Kemeness or his client of that he received and deposited this check. Respondent did not remit any monies to Kemeness from the RV Super Center check, although Kemeness was entitled to receive $3,750 from the RV Super Center check.
11. On December 29, 2008, Respondent’s CalNational client trust account balance was $211.52. Then the account closed with a zero balance the next day.
CONCLUSIONS OF LAW
By failing to pay out to Kemeness his portion of the Adventure RV check and the RV Super Center check, Respondent failed to promptly pay, as requested by the client, any funds in the possession of the member which the client was entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-10922
FACTS
1. On January 14, 2008, Respondent, on behalf of Educap, filed a complaint in Los Angeles Superior Court entitled Educap Inc v. Andrea Barba and Samara Rodgers, case no. 08K00767 (the "Educap matter")
2. Respondent failed to file a proof of service ("POS") for both defendants in the Educap matter.
3. On January 15, 2008, the court ordered Respondent to appear at an Order to Show Cause ("OSC") hearing to explain why sanctions should not be imposed for failing to file the proof of service. The hearing was set for July 17, 2008.
4. On March 11, 2008, Respondent filed a proof of service reflecting service on defendant Barba, but failed to file a proof of service reflecting service on defendant Rodgers.
5. On July 17, 2008, Respondent failed to appear at the OSC hearing. The court ordered Respondent to file a declaration regarding his failure to appear. The court sanctioned Respondent $750.00 and set an OSC hearing date for August 7, 2008. The sanctions order was properly served on Respondent, who actually received the order.
6. On August 7, 2008, the court sanctioned Respondent $250.00 for his failure to timely file a proof of service reflecting service on both defendants. Respondent engaged an appearance attorney to appear at the hearing. At the August 7, 2008 hearing, the court set an OSC re dismissal for November 5, 2008. Respondent received proper notice of the court’s November 5, 2008 OSC.
7. Respondent filed a Request for Entry of Default as to defendant Barba. Respondent paid the $250.00 sanction.
8. On October 28, 2008, Respondent filed a Request for Entry of Default as to defendant Rodgers.
9. At the OSC hearing on November 5, 2008, the court imposed a $500,00 sanction against Respondent for failing to have default judgment entered as ordered on August 7, 2008. Respondent engaged an appearance attorney to appear at the November 5, 2008 hearing. The court then set an OSC re dismissal for February 19, 2009 and ordered Respondent to have a default judgment entered prior to the hearing. Respondent received proper notice of the court’s November 5, 2008 order.
10. Respondent failed to have the default judgment entered in the Educap matter.
11. At the hearing on February 19, 2009, the court imposed $1,000.00 sanction against Respondent for failure to have the default judgment entered as ordered on November 5, 2008. Respondent failed to appear at the hearing. Respondent received proper notice of the court’s February 19, 2009 sanctions order.
12. Respondent has not complied with the court’s February 19, 2009 sanction order.
CONCLUSIONS OF LAW
By failing to pay the court ordered sanctions pursuant to the court’s February 19, 2009 sanctions order, Respondent violated an order of the court requiring him to do or forbear an act connected with or in the course of his profession, which he ought in good faith to do or forbear, in wilful violation of Business and Professions Code section 6103.
Case No. 09-O-11190
FACTS:
Respondent was hired by Donald Wilbur of the Wilbur Law Firm, on behalf of Wilbur’s client AMEX Assurance Company, for several collection matters, including the accounts of debtors Tabitha Owen, Keith Bean and Luke Milner, and on behalf of client Mitsui Insurance Compay of America, for a collection matter involving debtor Maldonado Vineyard Management.
Tabitha Owen Matter
1. On June 26, 2008, Wilbur contacted Respondent for the Owen matter and enclosed a $400.00 advanced cost check per Respondent’s request. Respondent’s contingency fee was 25%. Pursuant to the agreement, Respondent was required to remit 75% of collections. Wilbur requested Respondent immediately file litigation and forward a stamped complaint and provide status updates.
2. On July 4, 2008, Respondent deposited Wilbur’s check of $400.00 into his CalNational cost account.
3. On July 16, 2008, Respondent completed and returned Wilbur’s receipt confirming acceptance of advanced costs and the Owen matter.
4. On September 25, 2008, Wilbur contacted Respondent requesting a status update and the civil case number in the Owen matter. Respondent did not respond.
5. On October 3, 2008, Wilbur sent another email requesting a status update. Respondent responded stating that the civil complaint would be ready in two weeks. After this email, Respondent did not provide anymore updates to Wilbur on the Owen matter.
6. On November 14, 2008, Respondent closed his law firm. Respondent did not return the unused advanced costs to Wilbur.
7. Respondent failed to maintain the unused advanced costs in a trust account.
Keith Bean Matter
8. On August 25, 2008, Wilbur sent a letter to Respondent confirming acceptance of the Bean matter. Wilbur also enclosed a $450.00 advanced cost check. Wilbur requested Respondent to file litigation immediately and forward a file-stamped complaint and provide status updates.
9. On August 29, 2008, Respondent confirmed acceptance of the case and the receipt of $450.00. Respondent stated that litigation would begin shortly and would update Wilbur within 30 to 45 days, if not earlier.
10. On September 3, 2008, Respondent deposited the $450.00 into his CalNational cost account.
11. On November 14, 2008, Respondent closed his law firm. Respondent did not return the unused advanced costs to Wilbur. Respondent did not commence any litigation in the Bean matter.
12. Respondent failed to maintain the unused advanced costs in a trust account.
Luke Milner Matter
13. On December 15, 2007, Wilbur sent a confirmation letter and a $400.00 advanced costs check to Respondent. Respondent was to handle the Milner matter on a 25% contingency fee basis.
14. On December 28, 2007, Respondent faxed a letter to Wilbur confirming receipt of the letter and check. He stated he would commence litigation shortly.
15. On May 14, 2008, Respondent filed a suit in Riverside Superior Court entitled Amex Assurance Company v. Miller, case no. TEC086469.
16. O July 24, 2008, Respondent requested a settlement release of all claims for $4,395.77 and property damage release for $4,395.77. Both releases were notarized and executed by Debra Johnson of AMEX.
17. On August 1,2008, Respondent received and deposited the debtor’s check for $4,395.77 for final property damage. Respondent deposited the check into his CalNational client trust account. The other half of the settlement, $4,395.77, was still outstanding.
18. On August 7, 2008, Respondent received and deposited the second half of the settlement for $4,395.77. Wilbur was unaware that Respondent received the settlement checks.
19. On September 29, 2009, Respondent paid out to Wilbur $3,296.83, which was, 75% of the property damage check.
20. On October 1, 2008, Respondent sent a letter to Wilbur stating that the matter was paid in full, but that Wilbur owed an additional $16.00 in other costs. Wilbur had not received the other half of the settlement or had knowledge that Respondent received the other half.
21. On October 3, 2008, Wilbur inquired about the second half of the settlement. Respondent emailed back stating that he had received the second half and would remit it at the end of October 2008.
22. On December 15, 2008, Wilbur inquired again about the second half of the settlement. Respondent did not respond.
23. On December 23, 2008, Wilbur resent the email but still did not receive a response. Respondent did not pay out the additional portion of the settlement owed to Wilbur in the amount of $3,296.83.
Maldonado Vineyard Management Matter
24. On April 1, 2008, Wilbur sent a letter to confirm Respondent’s acceptance and enclosed a $500 advanced costs check.
25. On April 8, 2008, Respondent confirmed receipt of the case and check. Respondent stated that he would commence litigation shortly and would update Wilbur within 30 to 45 days, if not earlier.
26. On April 9, 2008, Respondent deposited the $500.00 into his CalNational cost account.
27. On November 14, 2008, Respondent closed his law firm. Respondent did not file any litigation suit regarding the Maldanado Vineyard matter. Respondent did not return the unused advanced costs to Wilbur.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Wilbur in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct ’4-100(A).
By failing to promptly pay to Wilbur the unused advanced costs and Wilbur’s portion of the Milner settlement to Wilbur, as requested by the client, Respondent failed to promptly pay to Wilbur any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-11192
12. On July 9, 2007, Respondent was retained by Richard Crowther, on behalf of CA Screen Pros, for a collection matter (the "Screen Pros matter"). The amount of the debt was $10,406.63. Pursuant to the retainer agreement with Screen Pros, Respondent was entitled to a 20% contingency fee from the amount collected from the debtor.
13. The client paid advanced costs of $450.00 to Respondent, which was deposited into Respondent’s CalNational cost account.
14. On June 26, 2008, Respondent filed a lawsuit in Orange County Superior Court entitled California Screen Pros, Inc. v. Dutch Bros., case no. 30-2008-00079570-CL-CL-NJC.
15. By October 2008, Respondent settled the Screen Pros matter for payment of $5,900.00. On October 20, 2008, Dutch Bros. provided the settlement check to Respondent. Respondent deposited the settlement check in his CalNational trust account on October 22, 2008.
16. Respondent did not pay out any portion of the Screen Pros settlement check to the client, even though the client was entitled to receive $4,720.00 from the settlement.
CONCLUSIONS OF LAW
By failing to promptly pay to Screen Pros the portion of the Screen Pros settlement owed to Screen Pros in the amount of $4,750.00, as requested by the client, Respondent failed to promptly pay to Screen Pros any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-11293
FACTS
Respondent was hired in August 2008 by Marc Norych for several collection matters against debtors CR Management, Ross and Michelle Hashemi, Kevin and Keith Presley, Corinthian International Parking Service, Mitchell Bailey and Jeffrey Winters, Richard Burdick, Eddie Vicenty and Joe Pena.
CR Management Matter
1. In August 2008, Respondent was hired for a collection matter against CR Management and Time Warner. The balance due was $11,044.49 (the "CR Management matter"). Pursuant to the retainer agreement with Norych, Respondent was entitled to receive a 20% contingency fee for the monies collected in the CR Management matter.
2. Respondent settled the CR Management matter for $11,294.49. The debtor provided the settlement check to Respondent, who deposited it into his CalNational trust account on October 8, 2008.
3. By November 2008, the balance in Respondent’s CalNational trust account dropped to zero.
4. At no time has Respondent paid out to Norych the amount of the CR Management settlement due American Bankers, even though the client was due $9,035.60 of the settlement proceeds.
Hashemi Matter
5. On August 6, 2008, Respondent sent a letter to Norych confirming his retention in the collection matter against Ross and Michelle Hashemi.
6. On September 5, 2008, Respondent sent a letter to Norych requesting a payment for advanced costs in the amount of $450.00, which was received. Respondent deposited the advanced cost into Respondent’s CalNational cost account on October 29, 2008.
7. Respondent did not file a lawsuit or undertake any legal work with respect to the Hashemi matter.
8. Respondent failed to maintain the advanced costs of $450.00 in a trust account.
9. Respondent failed to pay out to Norych the advanced costs of $450.00 after he closed his law firm in November 2008.
Presley Matter
1. On July 20, 2007, Respondent sent a letter to Norych confirming his retention in the collection matter against Kevin and Keith Presley.
’2. On August 15, 2007, Respondent sent a letter to Norych requesting a payment for advanced costs in the amount of $450.00, which was received. On November 14, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Presley matter.
4. Respondent failed to maintain the advanced costs of $450.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $450.00 after he closed his law firm in November 2008.
Corinthian Matter
1. On November 2, 2007, Respondent sent a letter to Norych confirming his retention in the collection matter against Corinthian International Parking Service.
2. On December 6, 2007, Respondent sent a letter to Norych requesting a payment for advanced costs in the amount of $375.00, which was received. On January 18, 2008, Respondent deposited the advanced cots into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Corinthian matter.
4. Respondent failed to maintain the advanced costs of $375.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $375.00 after he closed his law firm in November 2008.
Bailey/Winters Matter
1. On November 8, 2007, Respondent sent a letter to Norych confirming his retention in the collection matter against Mitchell Bailey and Jeffrey Winters.
2. On November 12, 2007, Respondent sent a letter to Norych requesting a payment for advanced costs in the amount of $495.00, which was received. On January 31, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Bailey/Winters matter.
4. Respondent failed to maintain the advanced costs of $495.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $495.00 after he closed his law firm in November 2008.
Burdick Matter
1. On November 19, 2007, Respondent sent a letter to Norych confirming his retention in the collection matter against Richard Burdick.
2. On January 11, 2008, Norych sent a check for advanced costs in the Burdick matter of $330.00, which was received. On January 29, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Burdick matter.
4. Respondent failed to maintain the advanced costs of $330.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $330.00 after he closed his law firm in November 2008.
Vicenty Matter
1. On February 22, 2008, Respondent sent a letter to Norych confirming his retention in the collection matter against Eddie Vicenty.
2. On March 19, 2008, Respondent sent a letter requesting the payment of advanced costs in the amount of $450.00, which was received. On April 25, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Vicenty matter.
4. Respondent failed to maintain the advanced costs of $450.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $450.00 after he closed his law firm in November 2008.
Pena Matter
1. On August 6, 2008, Respondent sent a letter to Norych confirming his retention in the collection matter against Joe Pena.
2. On September 5, 2008, Respondent requested a payment of advanced costs in the amount of $550.00, which was received. On October 24, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
3. Respondent did not file a lawsuit or undertake any legal work with respect to the Pena matter.
4. Respondent failed to maintain the advanced costs of $550.00 in a trust account.
5. Respondent failed to pay out to Norych the advanced costs of $550.00 after he closed his law firm in November 2008.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Norych in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to Norych the portion of the CR Management settlement owed to American Bankers in the amount of $9,035.60, and the unused advanced costs owed to Norych, as requested by the client, Respondent failed to promptly pay to American Bankers any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-11440
FACTS
6. On November 5, 2008, Respondent was retained by Patrick Davidson to enter a sister-state judgment against a debtor located in California (the "Davidson matter").
7. Respondent requested a payment of advanced costs in the amount of $450.00, which was received. On November 14, 2008, Respondent deposited the advanced costs into Respondent’s CalNational cost account.
8. At no time did Respondent file any documents or perform any legal services related to the Davidson matter.
9. Respondent failed to maintain the advanced costs of $450.00 in a trust account.
10. Respondent failed to pay out to Davidson the advanced costs of $450.00 after he closed his law firm in November 2008.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Davidson in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to Davidson the unused advanced costs owed to Davidson, as requested by the client, Respondent failed to promptly pay to American Bankers any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-11724
FACTS
1. On February 7, 2007, Respondent was retained by Peregrine Financial Group ("PFG") for a collection matter against debtors Paul and Ernestine Scott. Pursuant to the contingency agreement with PFG Respondent was entitled to collect 25% of the monies collected from the debtor.
2. Respondent filed a lawsuit in Riverside Superior Court entitled Peregrine Financial Group v. Scott, case no. RIC294363 (the "PFG matter").
3. The PRG matter.resulted in a judgment against the Scotts.
4. In fall 2007, Respondent identified debtor Paul Scott’s employer and initiated garnishment proceedings. The first garnishment occurred in November 2007.
5. In March 2008, Respondent made the first remittance to the client. The monthly remittance continued until July 2008. Thereafter, despite his receipt of garnishment checks from the debtor’s employer, Respondent failed to make any additional payments to PFG.
6. Before Respondent closed down his law office in November 2008, Respondent received and deposited into his CalNational trust account five garnishment checks totaling $8,709.35, received during the time period from August 26, 2008 through November 5, 2008.
7. Respondent failed to maintain the $6,532.01 owed to PFG from the garnishment checks in a trust account.
8. Respondent did not pay out to PFG the $6,532.01 owed from the garnishment checks.
CONCLUSIONS OF LAW
By failing to promptly pay to PFG the portion of the garnishment checks owed to PFG in the amount of $6,532.01, as requested by the client, Respondent failed to promptly pay to American Bankers any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-12730
FACTS
1. On September 23, 2005, Edward Flaherty, on behalf of his client Signation Sign Group, aka Sign Zone, forwarded a collections matter to Respondent to collect a debt owed by Exhibit Deal, LLC (the "Sign Zone matter").
2. On October 5, 2005, Respondent sent a letter confirming his retention in the Sign Zone matter.
3. On November 1, 2005, Respondent sent a letter confirming that he was entitled to a 22.5% contingency fee, and a payment of advanced costs of $450.00.
4. On December 15, 2005, Respondent acknowledged receipt of the advanced costs and stated that litigation had commenced. The next day, Respondent filed a complaint in Orange County Superior Court entitled Signation Sign Group, Inc. dba Edge Exhibits v. ExtfibitDeal, LLC, case no. 05CC13205.
5. On February 21, 2007, by stipulation, judgment was entered in favor of the plaintiff in the sum of $353,780.68. Pursuant to the stipulated judgment, the defendant was to make several payments varying in amount over time which were made payable to Respondent. As the payments were made by the debtor, Respondent deposited the payments into his CalNational client trust account. Respondent made regular remittances to Sign Zone for their portion of the periodic payments from the debtor.
6. From August 2008 through November 2008, the debtor made a series of payments in a cumulative sum of $10,000, which was received and deposited into Respondent’s CalNational client trust account.
7. Respondent did not pay out any portion of the payments received from August 2008 through November 2008 from the debtor to Sign Zone, even though Sign Zone was entitled to receive $7,750 of the payment.
CONCLUSIONS OF LAW
By failing to promptly pay to Sign Zone the portion of the payments received from August 2008 through November 2008 owed to Sign Zone in the amount of $7,750, as requested by the client, Respondent failed to promptly pay to Sign Zone any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4 100(B)(4).
Case No. 09-O-14085
FACTS
Respondent was retained by La-Z-Boy, Inc, though attorney Andrew Lasine, for collection matters against debtors LAK Inc. and SPARKS & Co.
LAK Inc. Matter
1. On April 7, 2008, Lasine sent a letter to Respondent regarding the collection claim against LAK Inc. in the amount of $11,825.51 (the "LAK matter").
2. On April 15, 2008, Respondent sent a letter acknowledging the receipt of the LAK matter, stating that he would provide a progress update within 30 to 45 days, if not earlier.
3. On June 26, 2008, Respondent requested $450.00 in advanced costs for filing and services fees in the LAK matter. This was the last correspondence Lasine received regarding the LAK matter.
4. On July 21,2008, Lasine sent the $450.00 advanced costs check to Respondent.
5. On July 25, 2008, Respondent deposited the check into his CalNational cost account. Respondent failed to maintain the unused advanced costs in his CalNational cost account after November 2008.
6. Respondent never filed a lawsuit in the LAK matter, and never incurred any costs. Respondent never refunded the unused advanced costs to Lasine.
SPARKS & Co Matter
7. On June 27, 2008, Lasine mailed Respondent an exemplified North Carolina Judgment for enforcement and collection in the amount of $35,524.25 against SPARKS & Co. (the "SPARKS matter").
8. On July 7, 2008, Respondent sent a letter confirming acceptance of the SPARKS matter. Respondent stated that he would update Lasine within 30 to 45 days, if not earlier.
9. On July 22, 2008, Respondent sent a letter requesting Lasine to pay $2,326.21, $550.00 in advanced costs and $1,776.21 for attorney fees.
10. On August 7, 2008, Lasine sent a check for $2,326.21.
11. On August 15, 2008, Respondent deposited the check from Lasine into his general account. The $500.00 for advanced costs was not maintained in a trust account.
12. Respondent never undertook any legal work to enforce the judgment in the SPARKS matter.
13. Respondent has not refunded the unearned fees or the unused advanced costs to Lasine.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Lasine in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to Lasine the unused advanced costs in the LAK and SPARKS matters, and the unearned advanced fees in the SPARKS matter, as requested by the client, Respondent failed to promptly pay to Lasine any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 09-O-14085
FACTS
In September 2008, Respondent was retained by Robert Whaley, on behalf of two if his clients, CBS Personnel Services (successor to Venturi Staffing Partners) and Staffmark Investment, to pursue collection matters.
Venturi matter
1. On July 15, 2008, Whaley sent a letter to Respondent regarding a collection matter for Venturi (the "Venturi matter").
2. On July 24, 2008, Respondent sent a letter to Whaley acknowledging receipt of the Venturi matter.
3. On August 13, 2008, Respondent sent a letter to Whaley requesting $550.00 in advanced costs.
4. On September 3, 2008, the client sent a $550.00 check to Respondent.
5.
6. On September 10, 2008, Respondent deposited the check into his CalNational cost account.
7. Respondent provided no legal services of value related to the Venturi matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to Whaley paid for the Venturi matter.
8. Respondent failed to maintain the unused advanced costs in a trust account.
Staffmark matter
9. On July 7, 2008, Whaley sent a letter to Respondent regarding a collection matter for Staffmark (the "Staffmark matter").
10. On July 15, 2008, Respondent sent a letter to Whaley acknowledging receipt of the Staffmark matter.
11. On August 14, 2008, Respondent requested a $550.00 cost deposit for filing and services fees.
12. On September 4, 2008, the client sent a $550.00 check to Respondent.
13. On September 10, 2008, Respondent deposited the check into his CalNational cost account.
14. Respondent provided no legal services of value related to the Staffmark matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to the client.
15. Respondent failed to maintain the unused advanced costs in a trust account.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Whaley in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costsl in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to Whaley the unused advanced costs in the Venturi and Staffmark matters, as requested by the client, Respondent failed to promptly pay to Whaley any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
Case No. 10-O-3433
FACTS
Respondent was retained by the Florida law firm of Douglas, Knight & Associates, Inc. ("Douglas") to pursue four subrogation claims on behalf of Douglas clients against debtors Attic Busters, Inc., Edrulfo Testa, Timothy Long and Rita Magallanes.
Attic Busters Matter
1. On December 12, 2007, Respondent sent a letter to Douglas acknowledging receipt of the Attic Busters matter.
2. On January 9, 2008, Respondent requested a $450.00 cost deposit for filing and services fees.
3. On January 21, 2008, the client sent a $450.00 check to Respondent.
4. On January 30, 2008, Respondent deposited the check into his CalNational cost account.
5. Respondent provided no legal services of value related to the Attic Busters matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to the client.
6. Respondent failed to maintain the unused advanced costs-in a trust account.
Edrulfo Testa Matter
1. On May 2, 2008, Respondent sent a letter to Douglas acknowledging receipt of the Testa matter.
2. On May 27, 2008, Respondent requested a $550.00 cost deposit for filing and services fees.
3. On May 28, 2008, the client sent a $550.00 check to Respondent.
4. On June 4, 2008, Respondent deposited the check into his CalNational cost account.
5. Respondent provided no legal services of value related to the Testa matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to the client.
6. Respondent failed to maintain the unused advanced costs in a trust account.
Timothy Long Matter
1. On August 13, 2008, Respondent sent a letter to Douglas acknowledging receipt of the Timothy Long matter.
2. On August 26, 2008, the client sent a $550.00 check for advanced costs to Respondent.
3. On September 3, 2008, Respondent deposited the check into his CalNational cost account.
4. Respondent provided no legal services of value related to the Timothy Long matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to the client.
5. Respondent failed to maintain the unused advanced costs in a trust account.
Magallanes Matter
1. On August 20, 2008, Respondent sent a letter to Douglas acknowledging receipt of the Magallanes matter.
2. On September 18, 2008, Respondent requested a $550.00 cost deposit for filing and services fees.
3. On October 9, 2008, the client sent a $550.00 check to Respondent.
4. On October 15, 2008, Respondent deposited the check into his CalNational cost account.
5. Respondent provided no legal services of value related to the Magallanes matter, and closed his law firm on November 14, 2008. Respondent did not return the unused advanced costs to the client.
6. Respondent failed to maintain the unused advanced costs in a trust account.
CONCLUSIONS OF LAW
By failing to maintain the unused advanced costs owed to Douglas in a client trust account, Respondent failed to maintain all funds received or held on behalf of a client, including advances for costs, in a client trust account in wilful violation of Rule of Professional Conduct 4-100(A).
By failing to promptly pay to Douglas the unused advanced costs in the Attic Busters, Tesa, Timothy Long and Magallanes matters, as requested by the client, Respondent failed to promptly pay to Douglas any funds in Respondent’s possession which the client is entitled to receive in wilful violation of Rule of Professional Conduct 4-100(B)(4).
RESTITUTION
Respondent acknowledges that he owes restitution (including the principal amount, plus interest of 10 percent per annum) to the payees listed below. If the Client Security Fund ("CSF") has reimbursed one or more of the payees for all or any portion of the principal amounts listed below, Respondent must also pay restitution to CSF in the amounts paid, plus applicable interest and costs. To the extent Respondent has already made any restitution payments, he will submit satisfactory proof of his restitution payments with his first quarterly report required pursuant to the disciplinary order resulting from this stipulation. Where Respondent has entered a compromise and release with any of the payees, full compliance with the compromise and release constitutes satisfactory proof of restitution.
Respondent must pay the restitution owed pursuant to the disciplinary order resulting from this stipulation and provide satisfactory proof of payment to the Office of Probation not later than three (3) years from the effective date of the disciplinary order resulting from this stipulation.
Case No. 08-O-14710
Client H&K
Client Matter: Dennis Williamson, Principal Amount: $450.00, Interest Accrues From: August 22, 2008.
Client Matter: David Good, Principal Amount: $375.00, Interest Accrues From: August 22, 2008.
Client Matter: Maria Magallanes-Lupian, Principal Amount: $450.00, Interest Accrues From: July 30, 2008.
Client Matter: Rebecca Tate-Lacroix, Principal Amount: $375.00, Interest Accrues From: May 16, 2008.
Client Matter: George Thomas, Principal Amount: $6,258.24, Interest Accrues From: January 8, 2007.
Case No. 09-O-10096
Client Receivables Control Corporation
Client Matter: Larry Lanzrath, Principal Amount: $27,625.00, Interest Accrues From: October 17, 2008.
Case No. 09-O-10133
Client J&R
Client Matter: Jessica Garcia, Principal Amount: $3,187.50, Interest Accrues From: October 1, 2008.
Case No. 09-O-10416
Client Alan Tabrizi
Client Matter: Scott Thomas Construction Co., Principal Amount: $5,263.86, Interest Accrues From: August 22, 2008.
Case No. 09-O-10465
Client Paul Kemeness
Client Matter: Adventure RV., Principal Amount: $670.00, Interest Accrues From: October 14, 2008
Client Matter: RV Super Center, Principal Amount: $3,750.00, Interest Accrues From: November 13, 2008.
Case No. 09-O-1190
Client Donald Wilbur
Client Matter:Taqbitha Owen, Principal Amount: $400.00, Interest Accrues From: July 4, 2008.
Client Matter: Keith Bean, Principal Amount: $450.00, Interest Accrues From: September 3, 2008.
Client Matter: Luke Milner, Principal Amount: $3,296.83, Interest Accrues From: August 7, 2008.
Client Matter: Maldanado Vineyard, Principal Amount: $500.00, Interest Accrues From: April 9, 2008.
Case No. 09-O-11192
Client Screen Pros
Client Matter: Dutch Bros., Principal Amount: $4,720.00, Interest Accrues From: October 22, 2008.
Case No. 09-O-11293
Client Marc Norych
Client Matter: CR Mangement, Principal Amount: $9,035.60, Interest Accrues From: October 8, 2008.
Client Matter: Hashemi, Principal Amount: $450.00, Interest Accrues From: October 29, 2008.
Client Matter: Presley, Principal Amount: $450.00, Interest Accrues From: November 14, 2008.
Client Matter: Corinthian International Parking Service, Principal Amount: $375.00, Interest Accrues From: January 18, 2008.
Client Matter: Bailey/Winters, Principal Amount: $450.00, Interest Accrues From: January 31, 2008.
Client Matter: Burdick, Principal Amount: $330.00, Interest Accrues From: January 29, 2008.
Client Matter: Vicenty, Principal Amount: $450.00, Interest Accrues From: April 25, 2008.
Client Matter: Pena, Principal Amount: $550.00, Interest Accrues From: October 24, 2008.
Case No. 09-O-11440
Client Patrick Davidson
Client Matter: Patrick Davidson, Principal Amount: $450.00, Interest Accrues From: November 14, 2008.
Case No. 09-O-11724
Client Peregrine Financial Group
Client Matter: Paul Scott, Principal Amount: $6,6532.01, Interest Accrues From: November 5, 2008.
Case No. 09-O-12730
Client Signation Sign Group
Client Matter: Exhibit Deal, LLC, Principal Amount: $7,750.00, Interest Accrues From: November 29, 2006
Case No. 09-O-14085
Client La-Z-Boy, Inc.
Client Matter: LAK Inc., Principal Amount: $450.00, Interest Accrues From: July 25, 2008.
Client Matter: Sparks & Co., Principal Amount: $2,326.01, Interest Accrues From: August 15, 2008.
Case No. 09-O-14085
Client Robert Whaley
Client Matter: Venturi, Principal Amount: $550.00, Interest Accrues From: September 10, 2008.
Client Matter: Staffmark, Principal Amount: $550.00, Interest Accrues From: September 10, 2008.
Case No. 10-O-03433
Client Douglas
Client Matter: Attic Busters, Principal Amount: $450.00, Interest Accrues From: January 30, 2008.
Client Matter: Edrulfo Testa, Principal Amount: $550.00, Interest Accrues From: June 4, 2008.
Client Matter: Timothy Long, Principal Amount: $550.00, Interest Accrues From: September 3, 2008.
Client Matter: Magallanes, Principal Amount: $550.00, Interest Accrues From: October 15, 2008.
AUTHORITIES SUPPORTING DISCIPLINE:
Standards:
Pursuant to Standard 1.3 of the Standards for Attorney Sanctions for Professional Misconduct:
The primary purposes of disciplinary proceedings conducted by the State Bar of California and of sanctions imposed upon a finding or acknowledgment of a member’s professional misconduct are the protection of the public, the courts and the legal profession; the maintenance of high professional standards by attorneys and the preservation of public confidence in the legal profession.
To determine the appropriate level of discipline, the standards provide guidance. Drociak v. State Bar (1991) 52 Cal.3d 1085; In the Matter of Sampson, 3 Cal. State Bar Ct. Rptr. 119. A disciplinary recommendation must be consistent with the discipline in similar proceedings. See Snyder v. State Bar(1990) 49 Cal.3d 1302. Moreover, the recommended discipline must rest upon a balanced consideration of relevant factors. In the Matter of Sampson, 3 Cal. State Bar Ct. Rptr. 119.
Pursuant to Standard 2.6 of the Standards for Attorney Sanctions for Professional Misconduct:
Culpability of a member of a violation of any of the following provisions of the Business and Professions code shall result in disbarment or suspension depending on the gravity of the offense or harm, if any, to the victim, with due regard to the purposes of imposing discipline set forth in standard 1.3.
(a) Sections 6067 and 6068;
(b) Sections 6103 through 6105;
(c) Sections 6106.1.
Pursuant to Standard 2.2(a) of the Standards for Attorney Sanctions for Professional Misconduct:
Culpability of a member of wilful misappropriation of entrusted funds or property shall result in disbarment. Only if the amount of the funds or property misappropriated is insignificantly small or if the most compelling circumstances clearly predominate, shall disbarment not be imposed. In those latter cases, the discipline shall not be less than one-year actual suspension, irrespective of mitigating circumstances
Pursuant to Standard 2.2(b) of the Standards for Attorney Sanctions for Professional
Misconduct:
Culpability of a member of commingling of entrusted funds or property with personal property or the commission of another violation of rule 4-100, Rules of Professional Conduct, none of which offenses result in the wilful misappropriation of entrusted funds or property shall result in at least a three month actual suspension from the practice of law, irrespective of mitigating circumstances.
Where Respondent’s misappropriation was the result of Respondent’s gross negligence, rather than intentional dishonesty, and there is compelling mitigation, discipline less than disbarment is an appropriate sanction. In the Matter of Robins (Review Dept. 1991) 1 Cal. State Bar Ct. Rptr. 708); In the Matter of Lilly (Review Dept. 1992) 2 Cal. State Bar Ct. Rptr. 185.
The stipulated discipline of a three year actual suspension, and five year stayed suspension is the appropriate discipline in these matters to protect the public. Respondent has established compelling mitigating circumstances which led directly to his inattention to his office’s accounts. Respondent’s mismanagement of his trust and cost accounts resulted from gross negligence and too heavy reliance on non-attorney accounting staff who misappropriated firm and client funds. Disbarment is not necessary to protect the public in these matters.
COSTS OF DISCIPLINARY PROCEEDINGS:
Respondent acknowledges that the Office of the Chief Trial Counsel has informed Respondent that as of December 3, 2010, the prosecution costs in this matter are $15,035.55. Respondent further acknowledges that should this stipulation be rejected or should relief from the stipulation be granted, the costs in this matter may increase due to the cost of further proceedings.
SIGNATURE OF THE PARTIES
Case Number(s): 08-O-14710, 09-O-10094, 09-O-10096, 09-O-10133, 09-O-10416, 09-O-10465, 09-O-10922, 09-O-11190, 09-O-11192, 09-O-11293, 09-O-11440, 09-O-11724, 09-O-12730, 09-O-14085, 09-O-15136, 10-O-03433
In the Matter of: Jay Michael Tenenbaum
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: Jay Michael Tenenbaum
Date: December 13, 2010
Respondent’s Counsel: Edward O. Lear
Date: December 13, 2010
Deputy Trial Counsel: Erin McKeown Joyce
Date: December 13, 2010
Case Number(s): 08-O-14710, 09-O-10094, 09-O-10096, 09-O-10133, 09-O-10416, 09-O-10465, 09-O-10922, 09-O-11190, 09-O-11192, 09-O-11293, 09-O-11440, 09-O-11724, 09-O-12730, 09-O-14085, 09-O-15136, 10-O-03433
In the Matter of: Jay Michael Tenenbaum
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.
<<not>> 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: Donald F. Miles
Date: January 10, 2011
[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 January 10, 2011, 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:
EDWARD O. LEAR, ESQ.
CENTURY LAW GROUP, LLP
5200 W. CENTURY BLVD #345
LOS ANGELES, CA 90045
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
ERIN JOYCE, ESQ., Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles, California, on January 10, 2011..
Signed by:
Rose Luthi
Case Administrator
State Bar Court