Opinion
Docket No. DRB 19-449
09-21-2020
In the Matter of Jason Joseph Mazzei An Attorney at Law
Eugene A. Racz appeared on behalf of the Office of Attorney Ethics. Respondent did not appear, despite proper notice.
Disciplinary Review Board
District Docket No. XIV-2018-0056E Decision Eugene A. Racz appeared on behalf of the Office of Attorney Ethics. Respondent did not appear, despite proper notice.
To the Honorable Chief Justice and Associate Justices of the Supreme Court of New Jersey.
This matter was before us on a motion for reciprocal discipline filed by the Office of Attorney Ethics (OAE), pursuant to R. 1:20-14(a)(4), based on respondent's disbarment in Pennsylvania. The OAE asserts that respondent was found guilty of violating the equivalents of New Jersey RPC 1.1(a) (gross neglect); RPC 1.3 (lack of diligence); RPC 1.5(a) (fee overreaching); RPC 1.15(a) (negligent misappropriation and commingling); RPC 1.15(b) (failure to promptly disburse funds to clients or third parties); RPC 1.15(c) (failure to segregate property in which both the attorney and client have an interest); RPC 1.15(d) and R. 1:21-6 (failure to comply with recordkeeping requirements); RPC 5.3(a), (b), and (c) (failure to properly supervise nonlawyer employees); RPC 5.5(a)(1) (unauthorized practice of law); RPC 1.17 (improper sale of a law office); RPC 8.4(c) (conduct involving dishonesty, fraud, deceit, or misrepresentation); and RPC 8.4(d) (conduct prejudicial to the administration of justice).
For the reasons set forth below, we recommend respondent's disbarment.
Respondent was admitted to the New Jersey bar in 1998 and to the Pennsylvania bar in 1999. He has no prior discipline in New Jersey. On July 22, 2019, the Court entered an Order revoking respondent's license to practice law, based on his failure to pay the annual assessment to the New Jersey Lawyers' Fund for Client Protection for seven consecutive years.
Rule 1:28-2(c) provides that an Order of revocation does not preclude the disciplinary system from exercising jurisdiction in respect of misconduct that pre-dated the Order.
This matter originally was before us on a motion for reciprocal discipline seeking respondent's disbarment for knowing misappropriation of client funds. On January 25, 2018, we denied the motion and remanded the matter to the OAE for further investigation to determine whether respondent or a rogue employee (his bookkeeper) was responsible for the misappropriation of a bankruptcy client's funds, as detailed below. We further directed the OAE to file a complaint to charge respondent with knowing misappropriation, if appropriate.
Initially, in connection with a joint stipulation, respondent was suspended in Pennsylvania for three years for misappropriation of entrusted funds through mismanagement; commingling; trust account deficiencies; and practicing law after being suspended in the United States Bankruptcy Court for the Western District of Pennsylvania (the Bankruptcy Court) and the United States District Court for the Western District of Pennsylvania (the District Court).
Thereafter, in a second disciplinary matter, respondent was disbarred by consent in the Bankruptcy Court and the District Court, and then was reciprocally disbarred by the Supreme Court of Pennsylvania for gross neglect; lack of diligence; fee overreaching; improper sale of a law practice; conduct involving dishonesty; and conduct prejudicial to the administration of justice.
I. THE JOINT PETITION
On July 17, 2014, respondent and the Pennsylvania Office of Disciplinary Counsel (ODC) filed a Joint Petition in Support of Discipline By Consent, as well as a July 16, 2014 Affidavit, under which respondent acknowledged the following material facts. The Malseed/InCharge Matter
Under the United States Bankruptcy Code, all individual debtors are required to complete credit-counseling courses in connection with the filing of a bankruptcy petition. A number of vendors, approved by the United States Department of Justice, Office of the United States Trustee (U.S. Trustee), offered credit-counseling courses. Respondent contracted with one such vendor, InCharge Education Foundation, Inc. (InCharge) to provide those services to his clients.
Respondent maintained an account with InCharge through which he billed his bankruptcy clients and paid InCharge. The clients, in turn, paid the cost of the counseling as part of respondent's initial retainer, along with filing costs associated with their bankruptcy matters. Although Pennsylvania's rules required respondent to deposit such entrusted funds in his attorney trust account, he regularly deposited them in his PNC Bank general account (equivalent to a New Jersey attorney business account). Between December 2009 and March 2013, respondent paid InCharge various outstanding balances from his general account.
As of July 31, 2011, respondent was entrusted with at least $10,705 in behalf of his bankruptcy clients for InCharge credit counseling services. InCharge had billed respondent this amount, but respondent had not paid those fees. Consequently, from March to September 2011, InCharge representatives repeatedly contacted respondent's law office, and his employee, Amy Carter, seeking payment of the outstanding balance. Neither Carter nor respondent replied to those requests for payment.
On October 3, 2011, Jennifer R. Marchi, Esq., counsel for InCharge, sent Carter a letter, seeking the $10,705 balance owed. Neither Carter nor respondent replied to Marchi's letter, and respondent failed to pay the outstanding invoices. Thereafter, on November 15, 2011, Marchi filed a letter complaint with Pennsylvania ethics authorities in behalf of InCharge. Although respondent's law firm received a copy of the letter, he took no action. Likewise, on November 29, 2011, the ODC investigator assigned to the case left a message with an employee of respondent, but respondent failed to return the call.
A subsequent ODC audit of respondent's attorney books and records revealed that respondent deposited, "or caused to be deposited," into the law firm's general account the funds entrusted to him by his clients for filing fees; bankruptcy credit-counseling; personal finance management courses required of individual bankruptcy debtors; PACER charges; and charges to obtain credit reports.
"PACER" refers to Public Access to Court Electronic Records, which allows users to obtain online case information about cases pending in the federal courts, including bankruptcy cases.
As of October 24, 2011, the balance in respondent's general account was -$3,107, which was at least $10,705 below the amount he was required to hold for the clients who had received counseling services from InCharge.
The ODC audit also revealed that respondent had failed to deposit and hold clients' bankruptcy costs in a segregated account, as required. Moreover, he did not claim that the InCharge invoices contained errors that might have explained his failure to remit payment for its services. Respondent, thus, admitted that he misappropriated the entrusted funds from his general account and that he failed to pay InCharge until 2013.
Respondent asserted in the joint petition that, if the matter had proceeded to a hearing, he would have presented evidence that: (1) the total amount owed to InCharge was less than $10,705 (although he conceded that the amount owed was substantial and, in any event, was not maintained in his trust account); and (2) because of perceived "logistics problems" with escrowing costs for bankruptcy matters, he treated the clients' advanced funds for costs as "gross fees," with the subsequent payment of costs as a "cost of doing business." For that reason, he did not maintain them in his trust account.
Respondent acknowledged that his trust account was "frequently and significantly out of trust," but asserted that, if the matter had proceeded to a hearing, he would have presented testimony that he had entrusted the maintenance of his trust account to his bookkeeper. Nevertheless, respondent acknowledged that he was responsible for ensuring that his trust account was maintained properly. Indeed, respondent's admitted failure to supervise his bookkeeper's actions provided the basis for the RPC 5.3 findings in Pennsylvania.
Finally, respondent agreed that the misappropriation of entrusted funds from the general account, failure to pay InCharge's outstanding balance until March 2013, and failure to supervise his bookkeeper violated the following Pennsylvania (Pa) Rules: RPC 1.15(b),(e),(f) and (m), RPC 5.3(a),(b), and (c), and RPC 8.4(c).
Pa RPC 1.15(b) is substantively similar to NJ RPC 1.15(a); Pa RPC 1.15(d) is substantively similar to NJ RPC 1.15(b); Pa RPC 1.15(e) is substantively similar to NJ RPC 1.15(b); Pa RPC 1.15(f) is equivalent to NJ RPC 1.15(c); Pa RPC 1.15(h) is equivalent to NJ RPC 1.15(a); Pa RPC 1.15(m) is equivalent to NJ RPC 1.15(d); Pa RPC 5.3(a) is equivalent to NJ RPC 5.3(a); Pa RPC 5.3(b) is equivalent to NJ RPC 5.3(b); Pa RPC 5.3(c) is equivalent to NJ RPC 5.3(c); and Pa RPC 8.4(c) is equivalent to NJ RPC 8.4(c).
The ODC also cited six additional bankruptcy matters in which respondent was alleged to have misappropriated client funds, as follows. The Garnett Bankruptcy
On May 31, 2010, respondent filed or caused to be filed, a Chapter 7 bankruptcy petition in the Bankruptcy Court, in behalf of Sarah R. Garnett. On September 3, 2010, he deposited, or caused to be deposited in his trust account, $7,274.35 in funds for the Garnett bankruptcy estate. Thereafter, respondent made disbursements from those funds that were unrelated to the bankruptcy. As of December 20, 2010, the balance in his trust account for Garnett was only $251.35. On February 4, 2011, respondent deposited or caused to be deposited $7,274.35 in unrelated funds in his trust account to replace Garnett's missing funds. Four days later, on February 9, 2011, respondent disbursed $7,274.35 to Garnett's bankruptcy trustee. The Morse Bankruptcy
On September 28, 2009, respondent filed or caused to be filed a Chapter 7 petition in the Bankruptcy Court, in behalf of Timothy J. Morse. Thereafter, between December 11, 2009 and September 8, 2010, respondent, or someone on his behalf, deposited in his trust account $4,716.50 for Morse's bankruptcy.
On October 22, 2010, respondent, or someone on his behalf, issued a trust account check for $11,000, payable to his law firm. This disbursement was unrelated to any legal fees owed to the firm. When that check was negotiated, respondent's trust account balance fell below the amount required to be held in Morse's behalf.
Thereafter, between November 3 and November 17, 2010, respondent, or someone on his behalf, deposited in his trust account an additional $1,200 of Morse's funds. As of November 17, 2010, respondent was required to hold $5,916.50 in his trust account for the bankruptcy matter.
On December 20, 2010, respondent, or someone on his behalf, issued a $10,000 trust account check, payable to his law firm, unrelated to any legal fees owed to the law firm, reducing his trust account balance to just $251.35. However, at that time, respondent was required to hold, inviolate, $13,190.85: Garnett's $7,274.35 and Morse's $5,916.50. Therefore, his trust account was short by $12,939.50.
On April 4, 2011, someone in behalf of respondent issued a trust account check for $4,400 in Morse's behalf, after which respondent was required to hold $1,516.50 ($5,916.50 - $4,400.00) in Morse's behalf.
Thereafter, respondent failed to maintain the remaining funds inviolate in his trust account. More than a year later, he disbursed $1,516.50 to Morse: $744 in August and $772.50 in December. The Sparber Bankruptcy
On May 27, 2009, respondent filed or caused to be filed a Chapter 13 bankruptcy petition in behalf of Henry Lee and Tammy Lee Sparber. Thereafter, between November 10, 2009 and May 24, 2010, respondent, or someone on his behalf, deposited $7,660.50 of the Sparbers' funds in his trust account to fund their bankruptcy matter.
On October 19, 2011, as a result of disbursements unrelated to the Sparbers, respondent's trust account balance fell to $493.04, which was $7,167.46 below the amount required to be held in the Sparbers' behalf.
Respondent admitted that, on December 20, 2010, as a result of disbursements unrelated to the Sparber, Morse, and Garnett bankruptcies, his trust account balance was only $251.35, which was $20,600 less than the amount required to be held in trust for these three clients. The Turner Bankruptcy
On December 31, 2010, respondent or someone on his behalf filed a Chapter 13 petition in the Bankruptcy Court, in behalf of Sharon Turner. Thereafter, between March 7 and October 11, 2011, respondent, or someone in his behalf, deposited $7,100 in his trust account in her behalf. Those funds were to be sent to the bankruptcy trustee, presumably to fund a payment plan.
On October 19, 2011, respondent, or someone in his behalf, issued a $16,000 trust account check payable to his law firm. This disbursement was unrelated to the Turner bankruptcy. On that date, the balance in respondent's trust account fell to $493.04, representing a $6,606.96 shortage in the amount required to be held in Turner's behalf.
Between November 10 and December 6, 2011, respondent, or someone in his behalf, deposited an additional $1,600 of Turner's funds in his trust account. As of December 6, 2011, respondent was required to hold $8,700 in Turner's behalf. On June 1, 2012, as a result of disbursements unrelated to Turner's matter, the balance in respondent's trust account was only $2,093.04, representing a shortage of $6,606.96 on account of Turner.
According to the joint petition, "[n]ot until October 2012 did Respondent disburse any of the $8,700.00 on behalf of Ms. Turner to the U.S. Trustee's Office." The joint petition did not state the amount disbursed to the U.S. Trustee. The Schmidt Bankruptcy
On November 6, 2007, respondent filed or caused to be filed a Chapter 13 bankruptcy petition for James and Kathy Schmidt, for which they paid him $400 toward his fee of "at least $2,500." In September 2010, respondent received an additional $2,100 fee payment from the Chapter 13 trustee.
Thereafter, on February 28, 2011, the Schmidts gave respondent a personal check for $8,600, payable to his law firm, to fund their bankruptcy. On March 1, 2011, respondent, or someone in his behalf, deposited the check in his trust account. On or about May 3, 2011, the Schmidts paid respondent $5,350 in cash to further fund the bankruptcy plan. By trust account check dated May 3, 2011, respondent forwarded $5,350 to the Chapter 13 trustee, Ronda J. Winnecour, Esq.
Later in May 2011, James Schmidt passed away. On May 24, 2011, respondent issued a $152 check for the Schmidts' matter, payable to his law firm, and drawn on a "PNC Bank Attorney at Law" account. Respondent then deposited that check in his trust account and disbursed $151.03 in trust account funds to Winnecour for the Schmidts' bankruptcy matter.
As a result of October 19, 2011 disbursements unrelated to the Schmidts' matter, the balance in respondent's trust account decreased to $493.04, representing a shortage of $8,107.93 for the Schmidts' matter. On August 1, 2012, the Schmidts' bankruptcy case was closed, but respondent failed to return the $8,600.97 to Kathy Schmidt. The Hill Bankruptcy
In April 2010, Ray and Jamie Hill retained respondent to represent them in a Chapter 13 bankruptcy. On October 7, 2010, respondent filed or caused to be filed a petition in their behalf.
On May 13, 2011, Altair Global Relocation sent respondent a $4,398.72 check for the Hills' bankruptcy, payable to his law firm. On May 20, 2011, respondent, or someone in his behalf, deposited those funds in his trust account. Also on May 20, 2011, respondent disbursed $1,468 to himself from his trust account for fees for the Hills' bankruptcy, leaving a balance of $2,930.72 for the Hills.
On October 19, 2011, as a result of disbursements unrelated to the Hills, the balance in respondent's trust account decreased to $493.04, resulting in a shortage of $2,437.68 for the Hills. A year later, on October 1, 2012, respondent issued two checks from a checking account with First Commonwealth Bank: an $874 check payable to the Hills and a $2,056.72 check payable to Winnecour, presumably the Hills' Chapter 13 trustee.
* * *
Respondent admitted that in the Garnett, Morse, Sparber, Turner, Schmidt, and Hill matters, he violated the following Pennsylvania RPCs: RPC 1.15(b), (d), (e), and (h), RPC 5.3(a), (b), and (c), and RPC 8.4(c). On November 20, 2014, the Supreme Court of Pennsylvania accepted the joint petition and respondent's affidavit under Rule 215(D)(1) Pa.R.D.E., in which he acknowledged that the material facts in the joint petition were true. Consequently, the court suspended him for three years.
In support of the three-year suspension imposed for misappropriation of entrusted funds, the joint petition cited several Pennsylvania cases involving attorneys who had converted client funds or misappropriated them, and received three-year suspensions.
On December 4, 2014, as a matter of reciprocal discipline, the Bankruptcy Court entered an order suspending respondent from the practice of law in that jurisdiction for three years, effective November 20, 2014. Respondent's Practice of Law While Suspended
On July 8, 2015, the U.S. Trustee filed a Motion for an Order to Show Cause, directed to respondent and Fred W. Freitag, Esq., alleging that respondent, while employed by Freitag, had practiced law in the Bankruptcy Court subsequent to the effective date of his three-year suspension in that jurisdiction.
Specifically, the U.S. Trustee's investigation revealed that, in January 2015, Freitag formed Keystone Legal Solutions, LLC, a Pennsylvania limited liability corporation, and hired respondent as an employee. From January to June 2015, Keystone operated from the office that had housed respondent's law practice prior to his suspension. Additionally, Keystone used the same website (www.debt-be-gone.com) as respondent had used for his law practice. From 1992 to 1995, Freitag filed thirty-nine bankruptcy cases, and only two such filings from 2005 to 2014. Yet, in the first five months of Keystone's operations, he filed fifty bankruptcy cases.
In 2015, the attorney for the U.S. Trustee attended the § 341(a) meeting of creditors for four Keystone clients, all debtors in the Bankruptcy Court, regarding Freitag and respondent's involvement in their bankruptcies. All four debtors testified that respondent, not Freitag, had shepherded them through their bankruptcy matters. Ultimately, respondent admitted that, after his suspension in the Bankruptcy Court, and while employed by Keystone, he continued to practice bankruptcy law by meeting with, and providing legal advice to, at least those four debtors. He prepared and reviewed petitions, schedules, and debtor statements of affairs, and advised clients how and under what bankruptcy chapter they should proceed. In two of the matters, the clients met exclusively with respondent, until meeting Freitag, for the first time, at the § 341(a) first meeting of creditors.
On February 5, 2016, respondent and the U.S. Trustee entered into a consent order stipulating that, among other provisions, respondent would sever ties with Keystone and refrain from performing bankruptcy services during his term of suspension. Thereafter, by order dated April 13, 2016, respondent consented to disbarment in both the Bankruptcy Court and the District Court.
On August 10, 2016, the Supreme Court of Pennsylvania reciprocally disbarred respondent, retroactive to November 20, 2014, the date of his prior three-year suspension.
II. THE MISCELLANEOUS BANKRUPTCY PROCEEDING
After we remanded the prior motion for reciprocal discipline matter for the issuance of a complaint against respondent, including a charge of knowing misappropriation, if appropriate, the OAE reviewed respondent's joint petition case file for clear and convincing evidence that he had knowingly misappropriated client funds. Finding a lack of such evidence, the OAE sent letters to respondent at two home addresses in Pennsylvania, requesting his written reply to allegations that he had knowingly misappropriated funds in the joint petition matter. Certified mail sent to both addresses was returned marked "Return to Sender." The regular mail sent to those addresses was not returned. Respondent did not reply and the OAE was unable to contact him by telephone.
The new inquiry also led to the OAE's discovery and review of additional court dispositions and court documents, from 2014 and 2015, of which that office previously had been unaware. These were additional Pennsylvania disciplinary matters, not the matters addressed in the joint petition above, and led to respondent's disbarment in the Pennsylvania courts, as detailed below.
Specifically, on April 2, 2014, the Honorable Jeffrey A. Deller, Chief Judge of the Bankruptcy Court, initiated a miscellaneous proceeding against respondent after receiving complaints about his billing practices and other alleged misconduct, including charging fees to which his clients had not agreed; failing to provide detailed invoices to clients; failing to disclose fees and expenses to the client and the court; receiving compensation without application to the court; filing litigation or other court procedures without the consent of the litigants; commencing loss mitigation matters with no justifiable basis; failing to communicate with clients; and failing to represent clients with appropriate diligence and competence. The miscellaneous bankruptcy matter was captioned, "Matters Involving the Professional Conduct of Jason J. Mazzei, Esq. and d/b/a/ Mazzei & Associates In Matters Before the Court" (the miscellaneous proceeding). This proceeding had formed the basis of respondent's consent to disbarment in the Bankruptcy Court and the District Court, and his disbarment by the Supreme Court of Pennsylvania.
According to the Bankruptcy Court's local Rule 9020-1, the Loss Mitigation Program is a structured process to facilitate consensual resolutions when residential property is at risk of foreclosure.
In its brief to us, the OAE stated that, "[b]ecause the underlying facts that led to respondent's disbarment in Pennsylvania were not addressed in the OAE's [2017] motion for reciprocal discipline, the OAE has discontinued its plenary investigation and now resubmits this Motion for Reciprocal Discipline to address the totality of respondent's ethical misconduct." According to the OAE, the sale of respondent's law practice further complicated his misconduct, as discussed below.
Although not highlighted in the OAE's brief, respondent was alleged to have violated Pa. RPC 1.17(a) by continuing to engage in the private practice of law in Pennsylvania after the sale of his practice to Paul McElrath, Esq.
On April 3, 2014, the Honorable Thomas P. Agresti, U.S.B.J., entered an order to show cause in the miscellaneous proceeding, directing respondent to file a reply to the bankruptcy court's List of Particulars (LOP) and to request an evidentiary hearing if he so chose. Judge Agresti commented in a footnote that more than "46 separate Orders to Show Cause have been issued against Mazzei by the Undersigned alone during this period involving hundreds of cases and a multitude of matters." The LOP alleged extensive misconduct by respondent, predominately involving his improper billing of bankruptcy clients and his taking of fees. Judge Agresti wrote, "based on the approximate 1,800 Chapter 13 cases alone, filed by Mazzei during the period of June 1, 2010 through June 1, 2013, a total of between $1.62 Million and $1.7 Million in such retainer monies was received by him." Moreover, the LOP listed more than 260 bankruptcies in which respondent filed Loss Mitigation Program (LMP) applications that the court later dismissed for respondent's failure to prosecute. Judge Agresti wrote,
[i]t is the Court's understanding that [respondent] may have received a $25 filing fee from those clients in each of those cases, but there is nothing to show whether those funds have ever been returned. At least $6,500 in reimbursement is apparently due those clients ... In the over 260 LMP cases dismissed [respondent] sought no-look fees totaling over $260,000 yet he failed to perform the services he represented to clients he would perform.
[OAEb,Ex.10 at p.10¶5.]
A no-look fee is a fee that is below the threshold that would trigger a required fee application to the Bankruptcy Court.
"OAEb" refers to the OAE's November 25, 2019 brief in support of the motion for reciprocal discipline. --------
The LOP further charged that respondent routinely overbilled clients; filed false or altered statements with the court; absconded with thousands of dollars in unused expense retainers; and indiscriminately pursued hundreds of loss mitigation cases without regard to whether such relief would benefit his clients. On May 5, 2014, respondent filed a reply to the show cause order contesting all the expert findings and court findings, and requested an evidentiary hearing in respect of the LOP.
Thereafter, respondent filed a motion to recuse Judge Agresti from the proceedings, after which the judge voluntarily recused himself. After Chief Judge Deller assigned the matter to the Honorable Gregory L. Taddonio, U.S.B.J., respondent filed a motion seeking reconsideration of the order assigning the matter to Judge Taddonio, which was denied.
On November 21, 2014, Judge Taddonio filed his Report and Recommendation to Chief Judge Deller. Because "[t]he allegations leveled against [respondent] are of sufficient magnitude and severity," Judge Taddonio recommended the appointment of an independent investigator and prosecutor for the matter. Three days later, on November 24, 2014, the Honorable Joy Flowers Conti, Chief Judge, appointed the Pennsylvania ODC as disciplinary counsel for the miscellaneous proceeding pending with Judge Taddonio.
Also on November 24, 2014, the U.S. Trustee filed a consent motion in the Bankruptcy Court proposing respondent's consent to a three-year concurrent suspension in the Bankruptcy Court and the District Court for the additional misconduct that was the subject of the miscellaneous proceeding. On February 13, 2015, the ODC filed its own consent motion proposing respondent's disbarment, retroactive to the date of his three-year suspension in the joint petition matter. In connection with that motion, rather than seek redress in federal court for his complaints about unfair treatment, respondent voluntarily executed a consent order for his disbarment in both the Bankruptcy Court and the District Court.
In a July 1, 2015 Memorandum Opinion, Judge Taddonio denied the ODC's consent motion because, given the "numerous debtors affected by [respondent's] actions . . . disbarment is not enough." Judge Taddonio found that, having collected "upwards of $950 each from hundreds of clients as an 'advance' against expenses incurred in their cases," respondent "pocketed those monies without any intention of reconciling the retainer against his actual expenses or returning the excess to his clients." According to Judge Taddonio, respondent had been accused of misusing in excess of $100,000 of clients' retainers. Moreover, the judge found that respondent's practice of collecting expense retainers began in about 2008. By January 2013, respondent had about 1,500 active cases in the Bankruptcy Court and had received approximately $1,350,000 in client funds "for which he failed to make an accounting."
In 2013, respondent sold his law practice, about which Judge Taddonio opined:
Mazzei sold his entire law practice to Paul McElrath on September 1, 2013. In re Mazzei, 5-22 B.R. 113, 122 (Bankr. W.D. Pa. 2014). The transfer included all material assets of the Mazzei firm, including the right
to service (subject to client consent) an inventory of over 900 chapter 13 cases. See In re Mazzei, Bankr. Case No. 13-00203-GLT, Dkt. No. 152. Upon completion of the sale and the transfer of cases to McElrath, Mazzei's representation terminated, thereby triggering his obligation to refund the unused portion of the expense retainer to his former clients or, alternatively, turning the funds over to McElrath. The record shows that he did neither. Although McElrath and his law firm took over the representation of these debtors, Mazzei failed to transfer the expense retainers to the acquiring firm. As an assignee of Mazzei's rights under the fee agreements, McElrath was entitled to tap into the expense retainer for ongoing costs incurred during the representation of Mazzei's former clients. Mazzei kept all of the retainers paid in the transferred cases, including those received just weeks prior to the sale. As a result of this conduct, money that was earmarked for future expenses has vanished. Unless Mazzei is held accountable for these funds, clients may bear the burden of paying for case expenses a second time.
[OAEb,Ex.16 at 13-14.]
At an August 4, 2015 status conference before Judge Taddonio, respondent requested an opportunity to address certain of the allegations of improper expenses as set forth in the Appendix to the judge's memorandum opinion. In respondent's August 18, 2015 submission, he denied any misconduct; asserted that no clients had complained about his actions; and denied that he had asked to settle the matter by disbarment because of any wrongdoing, but because he was unable and unwilling to continue to practice before the court. In a September 2, 2015 reply, the ODC countered that respondent had set forth no specific facts to refute the veracity of the allegations in the Appendix - which had been the purpose of his request in the first place. The ODC observed that, to proceed in court with the hundreds of bankruptcy matters in the Appendix would require extensive and voluminous discovery.
Thereafter, on April 5, 2016, District Court Chief Judge Conti entertained an ODC motion to withdraw from the miscellaneous proceeding. At the hearing, Judge Conti informed the parties that she would reconsider the earlier consent motion between the parties, if the terms remained acceptable to them. She memorialized that understanding in an April 13, 2016 order approving a disposition pursuant to which respondent consented to permanent disbarment and withdrawing the U.S. Trustee's November 24, 2014 proposed three-year suspension order. The court explained that,
under the totality of the circumstances, which includes the United States Trustee's decision not to pursue restitution and the [ODC's] request to withdraw from the matter, the settlement is reasonable, serves the interests of justice, protects the public and the integrity of the bar, and is consistent with this court's disciplinary authority.
[OAEb,Ex.20 at 2.]
In addition, on April 13, 2016, Judge Conti entered the parties' consent order, which respondent voluntarily executed, permanently disbarring him in the Bankruptcy Court and the District Court, retroactive to November 20, 2014, the effective date of his three-year suspension in the joint petition matter. The order also dismissed the miscellaneous proceeding and, with respondent's assent, directed the clerk of court to refer the matter to the Supreme Court of Pennsylvania for the imposition of reciprocal discipline.
By order dated May 18, 2016, the Supreme Court of Pennsylvania required respondent to "inform this Court . . . of any grounds against the imposition of identical or comparable discipline in this Commonwealth and the reasons therefor." On June 16, 2016, respondent furnished a reply opposing reciprocal discipline, claiming "bias and unfair treatment against [him] by the Judges of the United States Bankruptcy Court," who allegedly targeted him after "the public embarrassment of . . . the Court's hastily and ill-planned Loss Mitigation Program."
Despite having voluntarily consented to disbarment, rather than proceeding by way of a trial, respondent further contended that his consent "was made in an effort to remove [respondent] from the continued prosecution by the Court itself. No finding or any action which would require discipline was found or alleged by any opposing party," and that "when the judge is untruthful in his statements, and acts unfairly, the abuse of power makes a fair trial or hearing is [sic] impossible, and continued practice and fair treatment before that Court is likewise impossible."
In a July 13, 2016 reply, the ODC argued that respondent had every opportunity to proceed with the miscellaneous proceeding in federal court, but freely and voluntarily consented to disbarment in both the Bankruptcy Court and the District Court. Moreover, the ODC asserted that it was disingenuous for respondent to claim foul play, because he had been "fully aware that the disbarment on consent was going to be sent to the Supreme Court of Pennsylvania for the imposition of reciprocal discipline."
On August 10, 2016, the Supreme Court of Pennsylvania entered an order reciprocally disbarring respondent, retroactive to November 20, 2014, based on his disbarments in the Bankruptcy Court and the District Court.
In its motion for reciprocal discipline, the OAE argued that respondent should be disbarred in New Jersey. In respect of the joint petition matter, the OAE urged that respondent is guilty of negligent misappropriation and commingling, failure to promptly deliver funds to clients or third parties, failure to segregate property in which both the attorney and client have an interest, recordkeeping infractions, failure to supervise a nonlawyer employee, and practicing law while suspended.
In respect of the miscellaneous proceeding originating in the Bankruptcy Court, the OAE argued that respondent's misconduct constituted "systemic and pervasive" overbilling of hundreds of bankruptcy clients and his retention of the unearned portion of expense retainers in those matters, and evidenced his manipulation of the bankruptcy court's LMP. The OAE asserted that respondent is guilty of gross neglect and lack of diligence in more than 260 loss mitigation matters; commingling; recordkeeping violations; fee overreaching; the improper sale of a law practice; conduct involving dishonesty; and conduct prejudicial to the administration of justice.
The OAE urged us "to accept Respondent's signature upon Exhibit 15 [the disbarment by consent order] as the substantive equivalent of Disbarment by Consent in New Jersey" and to recommend to the Court respondent's disbarment.
In aggravation, the OAE asserted that respondent failed to cooperate with the OAE in the remand matter. Moreover, respondent failed to notify the OAE of his Pennsylvania discipline, as R. 1:20-14(a)(1) requires.
Respondent did not submit to us any response or position in respect of this matter.
Following a review of the record, we determine to grant the OAE's motion for reciprocal discipline. Pursuant to R. 1:20-14(a)(5), "a final adjudication in another court, agency or tribunal, that an attorney admitted to practice in this state . . . is guilty of unethical conduct in another jurisdiction . . . shall establish conclusively the facts on which it rests for purposes of a disciplinary proceeding in this state." Thus, with respect to motions for reciprocal discipline, "[t]he sole issue to be determined . . . shall be the extent of final discipline to be imposed." R. 1:20-14(b)(3). In Pennsylvania, the standard of proof in attorney disciplinary matters is that the "[e]vidence is sufficient to prove unprofessional conduct if a preponderance of the evidence establishes the conduct and the proof . . . is clear and satisfactory." Office of Disciplinary Counsel v. Kissel, 442 A. 2d 217 (Pa. 1982) (citing In re Berland, 328 A. 2d 471 (Pa. 1974)). Moreover, "[t]he conduct may be proven solely by circumstantial evidence." Office of Disciplinary Counsel v. Grigsby, 425 A. 2d 730 (Pa. 1981) (citations omitted).
We note that, in Pennsylvania, respondent stipulated to his violations of the RPCs and consented to disbarment in the Bankruptcy Court and the District Court. Although he was aware that those courts would refer him to the Supreme Court of Pennsylvania for the imposition of reciprocal discipline, he did not stipulate to the quantum of discipline (disbarment) to be imposed in Pennsylvania.
Reciprocal disciplinary proceedings in New Jersey are governed by R. 1:20-14(a)(4), which provides in pertinent part:
The Board shall recommend imposition of the identical action or discipline unless the Respondent demonstrates, or the Board finds on the face of the record upon which the discipline in another jurisdiction was predicated that it clearly appears that:
(A) the disciplinary or disability order of the foreign jurisdiction was not entered;
(B) the disciplinary or disability order of the foreign jurisdiction does not apply to the respondent;
(C) the disciplinary or disability order of the foreign jurisdiction does not remain in full force and effect as the result of appellate proceedings;
(D) the procedure followed in the foreign matter was so lacking in notice or opportunity to be heard as to constitute a deprivation of due process; or
(E) the unethical conduct established warrants substantially different discipline.
A review of the record does not reveal any conditions that would fall within the ambit of subparagraphs (A) through (E). We, thus, determine to impose discipline identical to that imposed in Pennsylvania - a recommendation for disbarment - for respondent's equivalent violations of New Jersey RPC 1.1(a) (gross neglect); RPC 1.3 (lack of diligence); RPC 1.5(a) (fee overreaching); RPC 1.15(a) (negligent misappropriation and commingling); RPC 1.15(b) (failure to promptly disburse funds to clients or third parties); RPC 1.15(c) (failure to segregate property in which both the attorney and client have an interest); RPC 1.15(d) and R. 1:21-6 (recordkeeping violations); RPC 5.3(a), (b), and (c) (failure to properly supervise nonlawyer employees); RPC 5.5(a)(1) (unauthorized practice of law); RPC 1.17 (improper sale of a law office); RPC 8.4(c) (conduct involving dishonesty, fraud, deceit, or misrepresentation); and RPC 8.4(d) (conduct prejudicial to the administration of justice).
In the joint petition matter, respondent admitted that he had misappropriated client funds that his bankruptcy clients had entrusted to him for required bankruptcy credit-counseling courses. Instead of placing those funds in "a segregated account," such as his attorney trust account, as required in Pennsylvania, respondent or someone to whom he had delegated the maintenance of his trust account in his behalf, presumably his bookkeeper, deposited them in his general business account. In the Malseed matter, in 2011, after the misappropriation of $10,705 of client funds from his general account, which respondent had improperly used for his convenience, he failed to pay InCharge for services rendered to his clients for the next two years.
In the remaining bankruptcy matters, client funds were misappropriated as follows. In the Garnett bankruptcy, respondent received $7,274.35 from his client, to be used for her bankruptcy. Although the funds were properly deposited in respondent's trust account, they were thereafter misappropriated for purposes unrelated to Garnett's matter.
In the Morse matter, $5,916.50 of the client's funds were deposited in respondent's trust account, but an $11,000 trust account check was issued to the law firm. That disbursement was unrelated to any legal fees to which respondent was entitled, for which respondent admitted the misappropriation of Morse's funds.
In the Sparber bankruptcy, from 2009 to 2010, the clients forwarded $7,660.50 to respondent on account of their bankruptcy. Those funds were deposited in respondent's trust account. As of October 19, 2011, all but a few dollars of that amount had been misappropriated.
In the Turner bankruptcy, $7,100 of the client's funds were deposited in respondent's trust account to fund a Chapter 13 plan. Yet, on October 19, 2011, someone issued a trust account check to the law firm for $16,000, a sum unrelated to Turner's bankruptcy matter. In the process, all but $493.04 of her funds were invaded, and respondent admitted misappropriation of Turner's funds.
In respect of the Schmidt bankruptcy, respondent received the clients' $8,600 personal check in February 2011, and later, an additional $5,350 to fund their Chapter 13 bankruptcy. Respondent properly disbursed the $5,350 to the Schmidts' bankruptcy trustee, but on October 19, 2011, $8,107.93 of their funds were used for purposes unrelated to their matter. When the bankruptcy was closed in August 2012, the Schmidts were still owed $8,600.
In the Hill bankruptcy, a relocation company sent respondent $4,398.72, which was deposited in respondent's trust account on the Hills' behalf. Thereafter, on October 19, 2011, disbursements unrelated to the Hills' matter caused the invasion of $2,437.68 of their funds.
Respondent claimed to have entrusted the maintenance of his attorney trust account to his bookkeeper, but admitted that the above misappropriations occurred. In aggravation, respondent failed to refund to the client in the Schmidt matter the missing $8,600, took two years to pay InCharge for its services, and failed to notify the OAE of his Pennsylvania disciplinary actions, as R. 1:20-14(a)(1) requires.
Based on the foregoing, respondent is guilty of negligent misappropriation and commingling (RPC 1.15(a)); failure to promptly deliver funds to clients (RPC 1.15(b)); recordkeeping violations for his misuse of the IOLTA account (RPC 1.15(d) and R. 1:21-6)); and failure to supervise a nonlawyer employee (RPC 5.3(a), (b), and (c)).
Respondent also practiced law while suspended, in four bankruptcy matters, during the first half of 2015. Respondent admitted that, after his suspension in the Bankruptcy Court and the sale of his law practice, and while employed by attorney Freitag, he met with, and provided legal advice to four debtor clients. He prepared and reviewed petitions, schedules, and debtor statements of affairs, and advised those clients how they should proceed. In two of the matters, the clients met exclusively with respondent until the first meeting of creditors, when Freitag met the clients for the first time. Respondent's flagrant violation of the Bankruptcy Court's three-year suspension order was in contravention of RPC 5.5(a)(1).
RPC 1.17(a) requires that, upon the sale of a law practice, the selling attorney must cease engaging in the private practice of law in that jurisdiction. As detailed above, after the sale of respondent's law practice to McElrath was completed and the bankruptcy cases were transferred to him, respondent continued to practice law in at least four matters, a violation of RPC 1.17(a), which is subsumed in the RPC 5.5(a)(1) finding, above.
We also consider respondent's misconduct in connection with the miscellaneous bankruptcy proceeding. After our January 2018 remand in the joint stipulation matter, the OAE discovered new information that had formed the basis for respondent's consents to disbarment in the Bankruptcy Court, in the District Court, and in Pennsylvania. As detailed in Judge Taddonio's comprehensive memorandum opinion in the miscellaneous matter, respondent engaged in widespread misconduct in the Western District of Pennsylvania bankruptcy courts where he maintained such a large presence that an independent investigation was required to sort through his rampant misconduct in that jurisdiction.
As previously stated, there is a presumption in reciprocal discipline matters that a final adjudication in the originating jurisdiction "shall conclusively establish the facts on which it rests for a disciplinary proceeding in this state." R. 1:20-14(a)(5). Here, in the miscellaneous matter, Judge Taddonio concluded that, in one bankruptcy courtroom alone, Judge Agresti had been compelled to issue more than forty-six separate show cause orders against respondent, involving hundreds of cases, for improper billing of bankruptcy clients and excessive attorney fees. Respondent initially contested the veracity of the matters contained in Judge Agresti's LOP and requested an evidentiary hearing in that regard. Ultimately, however, respondent elected not to go to trial - not to contest in federal court that, in January 2013, he had approximately 1,500 active bankruptcy cases in the Bankruptcy Court and had received approximately $1,350,000 in client's expense retainer funds for which he failed to make any accounting at all. Judge Taddonio concluded that respondent intentionally failed to account for expense retainers, intending instead to keep them.
Also, in the LMP cases, respondent sought no-look fees of more than $260,000 for work that the court concluded he failed to perform. Respondent also received a $25 filing fee from each client, but never accounted for those funds, totaling $6,500, which remained due to those clients, for a total of $266,500. Once again, in these matters, respondent had an opportunity to contest the court's findings in respect of his legal fees, expense retainers, and failure to account for his actions. However, he voluntarily chose not to go to trial on those issues. Respondent failed to account for the $1,350,000 in client retainer funds; to turn over expense retainers to his former clients or McElrath; or to refund $266,500 in unearned legal and filing fees in the LMP matters. Respondent engaged in a staggeringly large and dishonest fee-overreaching scheme, in violation of RPC 1.5(a) and RPC 8.4(c) and (d).
Additionally, the LOP listed more than 260 bankruptcy matters wherein respondent represented clients who filed LMP applications before Judge Agresti. Respondent, however, failed to prosecute those matters, resulting in their dismissal. His inaction constituted gross neglect and lack of diligence, violations of RPC 1.1(a) and RPC 1.3, respectively.
Finally, the OAE's brief stated that respondent failed to cooperate with disciplinary authorities, but failed to include a charge of a violation of RPC 8.1(b). Therefore, we make no finding in that regard.
In sum, we find that respondent violated the equivalent of New Jersey RPC 1.1(a) (gross neglect); RPC 1.3 (lack of diligence); RPC 1.5(a) (fee overreaching); RPC 1.15(a) (negligent misappropriation and commingling); RPC 1.15(b) (failure to promptly disburse funds to clients or third parties); RPC 1.15(c) (failure to segregate property in which both the attorney and client have an interest); RPC 1.15(d) and R. 1:21-6 (recordkeeping violations); RPC 5.3(a), (b), and (c) (failure to properly supervise nonlawyer employees); RPC 5.5(a)(1) (unauthorized practice of law); RPC 1.17 (improper sale of a law office); RPC 8.4(c) (conduct involving dishonesty, fraud, deceit, or misrepresentation); and RPC 8.4(d) (conduct prejudicial to the administration of justice). The only remaining issue for our determination is the appropriate quantum of discipline to be imposed for respondent's misconduct.
Attorneys found guilty of egregious fee overreaching have routinely been disbarred. In In re Shelton, 240 N.J. 171 (2019), on a motion for reciprocal discipline, the attorney was disbarred following his four-year suspension in Pennsylvania for collecting $60,700 in attorney fees and commissions in an estate matter, which equated to 30.26% of the gross estate. Shelton also failed to keep any time records and testified in Pennsylvania that he was "entitled to whatever fee [he] got." An attorney testified in that case that a reasonable fee for an estate of this size and complexity was $10,000 to $12,000 and that, in cases where the attorney serves as both the lawyer and the administrator of the estate, the fee typically does not exceed seven percent of the value of the gross estate. Therefore, Shelton's fees were exorbitant and in violation of RPC 1.5(a).
In In re Ledingham, 240 N.J. 115 (2019), the attorney was disbarred after charging fees of $120,275.25 in an estate matter, $88,410.48 of which the client had paid. The customary charge in Bergen County for a similar estate would range between $10,000 and $12,000. The client retained subsequent counsel who completed the estate for less than $10,000, with an additional $3,500 billed by local counsel in another state. Therefore, Ledingham's total fee should not have exceeded $15,500. He, thus, had charged the estate almost eight times the amount of the fee considered reasonable for such a matter. Moreover, Ledingham failed to establish that he had obtained any specific results on behalf of the estate from the excessive amount of time he billed on the matter.
In In re Ort, 134 N.J. 146 (1993), the attorney charged $32,000 in legal fees on an estate of no complexity valued at $300,000. Those charges were "utterly unreasonable and inconsistent with the factors . . . of RPC 1.5(a)." The Court noted that Ort's time sheets for the matter "reflected work performed by respondent that [it] would characterize as wasteful, excessive, and unnecessary. That violation alone calls for substantial discipline." Id. at 159-60 (citing In re Hinnant, 121 N.J. 395 (1990) (public reprimand for attorney who had charged fees amounting to overreaching and had engaged in a conflict of interest)). The Court disbarred Ort because, in addition to fee overreaching, he withdrew the attorney's fees of more than $32,000 without informing his client and without her authorization, in violation of RPC 1.5(b) and RPC 8.4(c). Id. at 160.
Here, respondent's misconduct was more egregious than that of the attorneys in the above disbarment cases. Respondent overreached hundreds of bankruptcy clients in amounts that defied a final tally, because respondent refused to account for client expense retainers in 1,500 matters totaling about $1,350,000 and $266,500 in LMP fees in 260 matters that were dismissed for his failure to prosecute them.
The sanction imposed for practicing law while suspended ranges from a lengthy suspension to disbarment, depending on the existence of other misconduct, the attorney's disciplinary history, and aggravating or mitigating factors. See, e.g., In re Phillips, 224 N.J. 274 (2016) (one-year suspension for attorney who stipulated that, while suspended, he had secured consent to an adjournment of a matrimonial motion that was to be heard during the term of suspension, and assisted the client in the matter; extensive prior discipline, including a prior admonition, two censures, and a three-month suspension); In re Brady, 220 N.J. 212 (2015) (one-year retroactive suspension imposed on attorney who, after a Superior Court judge had restrained him from practicing law, represented two clients in municipal court and appeared in a municipal court on behalf of a third client, after the Court had temporarily suspended him; Brady also failed to file the required R. 1:20-20 affidavit following the temporary suspension; significant mitigating factors, including the attorney's diagnosis of a catastrophic illness and other circumstances that led to the dissolution of his marriage, the loss of his business, and the ultimate collapse of his personal life, including becoming homeless, and, in at least one of the instances of his practicing while suspended, his desperate need to provide some financial support for himself; prior three-month suspension); In re Wheeler, 140 N.J. 321 (1995) (two-year suspension imposed on attorney who practiced law while serving a temporary suspension for failure to refund a fee to a client; Wheeler also made multiple misrepresentations to clients, displayed gross neglect and a pattern of neglect, engaged in negligent misappropriation and in a conflict of interest situation, and failed to cooperate with disciplinary authorities); In re Marra, 183 N.J. 260 (2005) (three-year suspension for attorney found guilty of practicing law in three matters while suspended; Marra also filed a false affidavit with the Court stating that he had refrained from practicing law during a prior suspension; the attorney had received a private reprimand, a reprimand, two three-month suspensions, a six-month suspension, and a one-year suspension also for practicing law while suspended); In re Cubberley, 178 N.J. 101 (2003) (three-year suspension for attorney who solicited and continued to accept fees from a client after he had been suspended, misrepresented to the client that his disciplinary problems would be resolved within one month, failed to notify the client or the courts of his suspension, failed to file the affidavit of compliance required by Rule 1:20- 20(a), and failed to reply to the OAE's requests for information; Cubberley had an egregious disciplinary history: an admonition, two reprimands, a three-month suspension, and two six-month suspensions); In re Walsh, Jr., 202 N.J. 134 (2010) (attorney disbarred in a default case for practicing law while suspended by attending a case conference and negotiating a consent order on behalf of five clients and making a court appearance on behalf of seven clients; Walsh also was guilty of gross neglect, lack of diligence, failure to communicate with a client, and failure to cooperate with disciplinary authorities during the investigation and processing of the grievance; he failed to appear on an order to show cause before the Court; extensive disciplinary history: reprimanded in 2006, censured in 2007, and suspended twice in 2008); and In re Olitsky, 174 N.J. 352 (2002) (attorney disbarred after he was suspended and agreed to represent four clients in bankruptcy cases, did not notify them that he was suspended from practice, charged clients for the prohibited representation, signed another attorney's name on the petitions without that attorney's consent and then filed the petitions with the bankruptcy court; in another matter, after Olitsky was suspended, he agreed to represent a client in a mortgage foreclosure, accepted a fee, and took no action on the client's behalf; in yet another matter, he continued to represent a client in a criminal matter after his suspension; Olitsky also made misrepresentations to a court and was convicted of stalking a woman with whom he had had a romantic relationship; prior private reprimand, admonition, two three-month suspensions, and two six-month suspensions).
Here, similar to the attorney in Olitsky (disbarment), respondent was suspended for three years in Pennsylvania and then flagrantly practiced law in at least four bankruptcy matters.
Respondent also mishandled multiple client matters. Generally, such misconduct results in suspensions of either six months or one year. See, e.g., In re Tunney, 181 N.J. 386 (2004) (six-month suspension for attorney who mishandled six matters, engaging in a combination of gross neglect, pattern of neglect, lack of diligence, failure to communicate, failure to promptly notify a client of receipt of funds, failure to properly terminate representation, knowingly disobeying an obligation under the rules of a tribunal, misrepresentation, and conduct prejudicial to the administration of justice; Tunney's depression considered in mitigation; prior reprimand); In re LaVergne, 168 N.J. 410 (2001) (six-month suspension for attorney who mishandled eight client matters; he was guilty of lack of diligence in six of them, failure to communicate with clients in five, gross neglect in four, and failure to turn over the file upon termination of the representation in three; in addition, in one of the matters, LaVergne failed to notify medical providers that the cases had been settled and failed to pay their bills; in one other matter, he misrepresented the status of the case to the client; LaVergne also was guilty of a pattern of neglect and recordkeeping violations); In re Suarez-Silverio, 226 N.J. 547 (2016) (one-year suspension for an attorney who, over thirteen years, mishandled twenty-three client matters before the Third Circuit Court of Appeals, many of which ended by procedural termination; he also disobeyed court orders and made a misrepresentation to the court clerk, which escalated the otherwise appropriate six-month suspension; previous admonition and reprimand for similar conduct); and In re Brown, 167 N.J. 611 (2001) (one-year suspension for attorney who, as an associate in a law firm, mishandled twenty to thirty files by failing to conduct discovery, to file pleadings, motions and legal briefs, and to generally prepare for trials; he also misrepresented the status of cases to his supervisors and misrepresented his whereabouts, when questioned by his supervisors, to conceal the status of matters entrusted to him; the disciplinary matter proceeded as a default; Brown had a prior reprimand).
Here, respondent's most serious misconduct involved his egregious fee overreaching and brazen practice of law while suspended. In respect of the former, the Bankruptcy Court, the District Court, and Supreme Court of Pennsylvania repeatedly sought respondent's cooperation in establishing the extent, if any, to which he may have been entitled to a portion of the large sums of money ($1,350,000 in expense retainers and $260,000 in LMP fees) that he had extracted from his vulnerable bankruptcy clients. Respondent, however, failed to provide specific information about them. He also had many opportunities to seek a trial to address the allegations in the miscellaneous matter. Instead, he elected to consent to disbarment for his misconduct.
Respondent had been suspended for three years for the misconduct in the joint petition matter before disciplinary authorities turned their attention to the additional misconduct in the miscellaneous matter. As seen above, in New Jersey, a lengthy suspension or disbarment could be supported for respondent's practice of law while suspended alone.
The additional misconduct in the miscellaneous matter removes any doubt that respondent's actions warrant disbarment: extensive overreaching in approximately 1,500 bankruptcy cases ($1,350,000); the gross neglect of 260 LMP matters; and the retention of the legal and filing fees ($266,500) in the LMP cases. In aggravation, respondent failed to cooperate with the OAE's investigation on remand and failed to promptly report his Pennsylvania discipline. There are no mitigating factors for our consideration.
For the totality of respondent's misconduct, we determine that disbarment is the only sanction that will serve to protect the public and preserve confidence in the bar.
We further determine to require respondent to reimburse the Disciplinary Oversight Committee for administrative and actual expenses incurred in the prosecution of this matter, as provided in R. 1:20-17.
Disciplinary Review Board
Bruce W. Clark, Chair
By: /s/ Ellen A. Brodsky
Ellen A. Brodsky
Chief Counsel
VOTING RECORD
Argued: June 18, 2020 Decided: September 21, 2020 Disposition: Disbar
| Members | Disbar | Recused | Did Not Participate |
|---|---|---|---|
| Clark | X | ||
| Gallipoli | X | ||
| Boyer | X | ||
| Hoberman | X | ||
| Joseph | X | ||
| Petrou | X | ||
| Rivera | X | ||
| Singer | X | ||
| Zmirich | X | ||
| Total: | 9 | 0 | 0 |
/s/ Ellen A. Brodsky
Ellen A. Brodsky
Chief Counsel