Disciplinary Counsel v. Schuler

[Cite as Disciplinary Counsel v. Schuler, 138 Ohio St.3d 346, 2014-Ohio-1127.]

DISCIPLINARY COUNSEL v. SCHULER.

[Cite as Disciplinary Counsel v. Schuler, 138 Ohio St.3d 346,

2014-Ohio-1127.]

Attorneys—Misconduct—Engaging in conduct involving dishonesty, fraud, deceit,

or misrepresentation and in conduct adversely reflecting on fitness to

practice law—Indefinite suspension, with credit for time served under an

interim felony suspension.

(No. 2012-1714—Submitted October 9, 2013—Decided March 26, 2014.)

ON CERTIFIED REPORT by the Board of Commissioners on Grievances and

Discipline of the Supreme Court, No. 12-018.

____________________

Per Curiam.

{¶ 1} Respondent, Robert Carl Schuler of Dublin, Ohio, Attorney

Registration No. 0053140, was admitted to the practice of law in Ohio in 1991.

On October 6, 2011, we suspended Schuler’s license to practice law on an interim

basis following his September 20, 2011 felony conviction for filing a false tax

return. In re Schuler, Case No. 2011-1678, 2011-Ohio-5139.

{¶ 2} In April 2012, relator, disciplinary counsel, filed a complaint

charging Schuler with two violations of the Code of Professional Responsibility

arising from the conduct that resulted in his felony conviction.1 In accordance

with BCGD Proc.Reg. 11, the parties submitted a consent-to-discipline agreement

containing a recommendation that Schuler be suspended for 18 months with credit

for time served under the interim suspension. On the recommendation of a panel

of its members, the Board of Commissioners on Grievances and Discipline

1. Relator charged Schuler with misconduct under the Disciplinary Rules of the Code of

Professional Responsibility for acts occurring before February 1, 2007, the effective date of the

Rules of Professional Conduct.

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recommended that we adopt the consent-to-discipline agreement, but we rejected

the parties’ recommended sanction and remanded the matter to the board for

further proceedings. Disciplinary Counsel v. Schuler, 134 Ohio St.3d 1463, 2013-

Ohio-502, 983 N.E.2d 364.

{¶ 3} On remand, the parties submitted stipulations of fact, misconduct,

and aggravating and mitigating factors and recommended that Schuler serve a

two-year suspension with credit for time served under his interim felony

suspension. A panel of the board conducted a hearing and adopted the parties’

stipulations of fact and misconduct, but the panel determined that Schuler’s

misconduct warranted an indefinite suspension with credit for time served. The

board adopted the panel’s report in its entirety, and no objections have been filed.

{¶ 4} Having reviewed the record, we accept the board’s findings of fact

and misconduct and agree that an indefinite suspension with credit for time served

is the appropriate sanction in this case.

Misconduct

{¶ 5} In March 2011, Schuler pled guilty to one felony count of filing a

false tax return in violation of 26 U.S.C. 7206(1) in the United States District

Court for the Southern District of Ohio. As part of his plea agreement, Schuler

admitted that he knowingly and willfully made and subscribed to a tax return for

calendar year 2002 that he did not believe to be true and correct. Specifically,

Schuler’s 2002 tax return reported a total adjusted gross income of $1,162,087,

but Schuler knew that he had received an additional $360,000 in business income

that he did not include on the return. The United States dismissed two other

counts against Schuler—a count for conspiracy to commit mail and wire fraud

and a count for false declarations before a grand jury.

{¶ 6} On September 20, 2011, the federal court sentenced Schuler to one

year of probation in a home-confinement program and assessed him a $50,000

fine. The court and probation authorities ordered Schuler to pay the fine in

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January Term, 2014

installments of $1,000 per month, and the judge waived the requirement that he

pay interest.

{¶ 7} At the May 2013 panel hearing, Schuler testified that he had

completed his probation in September 2012 and was current on the installment

payments for his fine. Schuler also testified that in 2009, during the course of the

federal investigation, he had sent the Internal Revenue Service (“IRS”) a check

for approximately $80,000, which was the amount of taxes that his accountant had

determined he should have paid on the unreported $360,000 in income.

According to Schuler, the IRS accepted his check, although he acknowledged that

the agency has authority to issue other civil penalties for late payment.

{¶ 8} Based on this record, the board found that Schuler’s conduct

violated DR 1-102(A)(4) (prohibiting a lawyer from engaging in conduct

involving dishonesty, fraud, deceit, or misrepresentation) and (A)(6) (prohibiting

a lawyer from engaging in conduct that adversely reflects on the lawyer’s fitness

to practice law). We agree with the board’s findings of misconduct.

Sanction

{¶ 9} When imposing sanctions for attorney misconduct, we consider

several relevant factors, including the ethical duties that the lawyer violated and

the sanctions imposed in similar cases. Stark Cty. Bar Assn. v. Buttacavoli, 96

Ohio St.3d 424, 2002-Ohio-4743, 775 N.E.2d 818, ¶ 16. In making a final

determination, we also weigh evidence of the aggravating and mitigating factors

listed in BCGD Proc.Reg. 10(B). Disciplinary Counsel v. Broeren, 115 Ohio

St.3d 473, 2007-Ohio-5251, 875 N.E.2d 935, ¶ 21. However, because each

disciplinary case is unique, we are not limited to the factors specified in BCGD

Proc.Reg. 10(B) and may take into account all relevant factors in determining

which sanction to impose.

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Aggravating and mitigating factors

{¶ 10} In aggravation, the parties have stipulated and the board has found

that Schuler acted with a dishonest motive. See BCGD Proc.Reg. 10(B)(1)(b).

Mitigating factors include the absence of a prior disciplinary record, cooperation

in the disciplinary process, and imposition of other penalties or sanctions—

namely, Schuler’s conviction, sentence, and fine. See BCGD Proc.Reg.

10(B)(2)(a), (d), and (f).

{¶ 11} The panel also addressed whether Schuler had fully acknowledged

the wrongful nature of his conduct. See BCGD Proc.Reg. 10(B)(1)(g). In

explaining the circumstance leading to his conviction, Schuler testified that the

“genesis” of his crime was a bookkeeping oversight. According to Schuler, he

was part owner of a radio-telecommunications business that had been sold at

some point in or prior to 2002. As part of the sale agreement, Schuler was to

receive three payments for his share of the business. Schuler claims that he set up

a system with his bookkeeper so that she would receive each payment and

coordinate with Schuler’s accountant to ensure proper tax treatment of the sale

proceeds.

{¶ 12} Schuler testified that at the time the second payment was due, an

officer of his company indicated that the payment would be wired and requested

instructions for doing so. Schuler e-mailed his bank for wiring instructions and

then forwarded the bank’s e-mailed instructions to the payer. The instructions,

however, directed that the money be wired into Schuler’s personal bank account,

and therefore the $360,000 second payment was deposited into that account rather

than sent to Schuler’s bookkeeper. According to Schuler, because the second

payment “didn’t get into [his] system” with the bookkeeper, it was not reported on

his tax return. Schuler also testified that he had met with his accountant once a

quarter and that the accountant knew about Schuler’s sale of the business and had

considered the tax consequences for him. Nevertheless, because the second

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payment was deposited in Schuler’s personal bank account, Schuler claimed that

the second payment “just got missed.”

{¶ 13} In its report and recommendation, the panel acknowledged that

Schuler took responsibility for signing the false tax return, but the panel

nonetheless concluded that Schuler “seemed to blame the error on others.” For

example, the board noted that Schuler testified that one of the greatest lessons he

had learned from the matter was that his choice of associates was “critically

important.” We accept the panel’s credibility determination regarding whether

Schuler fully appreciated the wrongfulness of his misconduct. “Unless the record

weighs heavily against a hearing panel’s findings, we defer to the panel’s

credibility determinations, inasmuch as the panel members saw and heard the

witnesses firsthand.” Cuyahoga Cty. Bar Assn. v. Wise, 108 Ohio St.3d 164,

2006-Ohio-550, 842 N.E.2d 35, ¶ 24.

Applicable precedent

{¶ 14} In support of its recommended sanction, the board cites three

recent cases in which we imposed indefinite suspensions for similar disciplinary-

rule violations involving felony tax-evasion convictions. See Disciplinary

Counsel v. Bennett, 124 Ohio St.3d 314, 2010-Ohio-313, 921 N.E.2d 1064

(indefinitely suspending an attorney, with credit for time served under an interim

felony suspension, for illegally structuring financial transactions in the amount of

$124,300 to evade federal currency-reporting requirements); Disciplinary Counsel

v. Smith, 128 Ohio St.3d 390, 2011-Ohio-957, 944 N.E.2d 1166 (indefinitely

suspending an attorney, with credit for time served under an interim felony

suspension, convicted of making false tax returns, conspiring to defraud the IRS,

and corruptly endeavoring to obstruct and impede an IRS investigation); and

Columbus Bar Assn. v. Hunter, 130 Ohio St.3d 355, 2011-Ohio-5788, 958 N.E.2d

567 (indefinitely suspending an attorney convicted of failing to report a cash

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payment of more than $10,000; the attorney also neglected two client matters and

failed to properly account for funds in his client trust account).

{¶ 15} Following this precedent, we agree with the board that an

indefinite suspension with credit for time served is warranted here. As the board

concluded, there is no compelling reason to decline Schuler credit for the time he

has served under his interim felony suspension, which has been in place since

October 6, 2011.

Conclusion

{¶ 16} Having reviewed the record, weighed the aggravating and

mitigating factors, and considered the sanctions imposed for comparable conduct,

we adopt the board’s recommended sanction. Accordingly, Robert Carl Schuler

is indefinitely suspended from the practice of law in Ohio, with credit for time

served under the interim felony suspension imposed on October 6, 2011. Costs

are taxed to Schuler.

Judgment accordingly.

PFEIFER, O’DONNELL, LANZINGER, KLATT, and O’NEILL, JJ., concur.

O’CONNOR, C.J., and FRENCH, J., concur with the sanction but would not

give credit for time served under the interim suspension.

WILLIAM A. KLATT, J., of the Tenth Appellate District, sitting for

KENNEDY, J.

____________________

Scott Drexel, Disciplinary Counsel, and Donald M. Scheetz, Assistant

Disciplinary Counsel, for relator.

Kegler, Brown, Hill & Ritter, Geoffrey Stern, and Jason Beehler, for

respondent.

_________________________

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