Columbus Bar Assn. v. McGowan

[Cite as Columbus Bar Assn. v. McGowan, 135 Ohio St.3d 368, 2013-Ohio-1470.]

COLUMBUS BAR ASSOCIATION v. MCGOWAN.

[Cite as Columbus Bar Assn. v. McGowan, 135 Ohio St.3d 368,

2013-Ohio-1470.]

Attorneys—Misconduct—Engaging in an illegal act that reflects adversely on the

lawyer’s honesty or trustworthiness, failing to act with reasonable

diligence in representing a client, and failing to cooperate in a

disciplinary investigation—Indefinite suspension with conditions for

reinstatement.

(No. 2012-1692—Submitted January 23, 2013—Decided April 16, 2013.)

ON CERTIFIED REPORT by the Board of Commissioners on Grievances and

Discipline of the Supreme Court, No. 11-002.

__________________

Per Curiam.

{¶ 1} Respondent, Charles McGowan of Columbus, Ohio, Attorney

Registration No. 0066471, was admitted to the practice of law in Ohio in 1996.

On December 30, 2010, we suspended McGowan’s license to practice law on an

interim basis following his felony convictions for conspiracy to commit money

laundering and willful failure to report the receipt of more than $10,000 in the

course of his trade or business as an attorney. In re McGowan, 127 Ohio St.3d

1488, 2010-Ohio-6467, 939 N.E.2d 185.

{¶ 2} In February 2011, relator, Columbus Bar Association, filed a three-

count complaint alleging that McGowan had violated the Rules of Professional

Conduct and the Disciplinary Rules of the Code of Professional Responsibility as

a result of the conduct underlying his felony convictions, his handling of two

client matters, and his failure to respond to the resulting disciplinary

investigations.

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{¶ 3} The parties submitted stipulations of fact, misconduct, and

aggravating and mitigating factors and jointly waived a formal hearing on the

matter. They suggested that the appropriate sanction for McGowan’s misconduct

is an indefinite suspension from the practice of law with credit for time served

under his interim felony suspension. They further recommended that he not be

permitted to petition for reinstatement until he has completed his term of federal

supervised release, made restitution of any unearned fees to his clients,

reimbursed the Clients’ Security Fund for any claims that it has paid to his clients,

and paid the cost of these proceedings. The panel and board have adopted these

stipulations of fact and misconduct and recommend that we adopt the parties’

jointly recommended sanction.

{¶ 4} We adopt the board’s findings of fact and misconduct and find that

an indefinite suspension from the practice of law is the appropriate sanction for

McGowan’s misconduct. In light of the fact that McGowan failed to cooperate in

relator’s disciplinary investigations and that he is still under supervised release,

however, we do not credit McGowan with the time he has served under his

interim felony suspension.

Misconduct

Felony Convictions

{¶ 5} Adopting the parties’ stipulations of fact and misconduct, the board

found that on December 8, 2009, McGowan pleaded guilty to a felony count of

conspiracy to commit money laundering in violation of 18 U.S.C. 1956(h) and a

separate count of willful failure to report the receipt of more than $10,000 in the

course of his trade or business as an attorney in violation of 31 U.S.C. 5331 and

5322(a) and 31 C.F.R. 103.30.

{¶ 6} The board found that the conduct that resulted in McGowan’s

felony convictions also violated Prof.Cond.R. 8.4(b) (prohibiting a lawyer from

committing an illegal act that reflects adversely on the lawyer’s honesty or

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trustworthiness), 8.4(c) (prohibiting a lawyer from engaging in conduct involving

dishonesty, fraud, deceit, or misrepresentation), and 8.4(h) (prohibiting a lawyer

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

practice law).

The Pyles Matter

{¶ 7} Peggy Pyles retained McGowan to defend her against a charge of

driving while intoxicated and paid $900 toward his quoted fee of $1,500.

McGowan appeared at Pyles’s arraignment but erroneously assumed that this

appearance would cause him to be entered as counsel of record. Because he was

not listed as counsel of record, he did not receive hearing notices from the court

and failed to appear at two hearings, though he did perform some investigatory

work in the case. In McGowan’s absence, Pyles elected to proceed pro se.

Thereafter, McGowan refunded one third of Pyles’s payment. However, he failed

to respond to the investigation of Pyles’s grievance and a notice of arbitration of

her fee dispute.

{¶ 8} The parties stipulated and the board found that this conduct

violated Prof.Cond.R. 1.3 (requiring a lawyer to act with reasonable diligence in

representing a client), 1.15(d) (requiring a lawyer to promptly deliver funds or

other property that the client is entitled to receive), 8.1(b) (prohibiting a lawyer

from knowingly failing to respond to a demand for information by a disciplinary

authority during an investigation), and 8.4(h) and Gov.Bar R. V(4)(G) (requiring

a lawyer to cooperate with a disciplinary investigation).

The Thurman Matter

{¶ 9} James Thurman Jr. retained McGowan to represent him in a

personal-injury matter and executed a contingent-fee agreement. McGowan did

not advise Thurman that he did not carry professional liability insurance and thus

did not have Thurman sign a written acknowledgement of that fact. He

communicated only sporadically with Thurman and failed to keep him adequately

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informed of the status of the case. Thurman eventually became dissatisfied and

terminated McGowan’s representation; McGowan cooperated with the new

counsel. He did not, however, respond to relator’s investigation of Thurman’s

grievance.

{¶ 10} McGowan’s conduct in the Thurman matter occurred both before

and after the February 1, 2007 effective date of the Rules of Professional

Conduct, and therefore relator charged him under both the Disciplinary Rules of

the Code of Professional Responsibility and the Rules of Professional Conduct.

The parties stipulated and the board found that McGowan’s conduct violated DR

1-104 and Prof.Cond.R. 1.4(c) (requiring a lawyer to disclose to the client that the

lawyer lacks professional liability insurance and maintain a copy of that

disclosure, signed by the client, for five years after termination of the

representation), DR 6-101(A)(3) (prohibiting neglect of an entrusted legal matter),

and Prof.Cond.R. 8.1(b).

Sanction

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

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.

{¶ 12} Regarding aggravating factors, the parties have stipulated and the

board has found that McGowan acted with a dishonest or selfish motive, engaged

in a pattern of misconduct involving multiple offenses, initially failed to cooperate

in the disciplinary process, and caused harm to vulnerable clients. See BCGD

Proc.Reg. 10(B)(1)(b), (c), (d), (e), and (h). Mitigating factors include the

absence of a prior disciplinary record and the imposition of criminal sanctions

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January Term, 2013

following McGowan’s felony convictions—a six-month prison term, three years

of supervised release, 150 hours of community service, and court-ordered

participation in a mental-health-treatment program. See BCGD Proc.Reg.

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

{¶ 13} The parties and board recommend that McGowan be indefinitely

suspended from the practice of law and that he not be permitted to petition for

reinstatement until he has completed his federal supervised release, made

restitution of unearned fees to his clients, reimbursed the Clients’ Security Fund

for any claims paid to his clients, and paid the costs of these disciplinary

proceedings in full. They further recommend that we credit McGowan for the

time he has served under his December 30, 2010 interim felony suspension.

{¶ 14} In support of this sanction, the board cites the following cases:

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

567 (imposing an indefinite suspension with reinstatement conditioned on the

completion of federal supervised release and the payment of restitution on an

attorney who was convicted of failing to report a cash payment of more than

$10,000 to the Internal Revenue Service (“IRS”), neglected two client matters,

and overdrew his client trust account); Disciplinary Counsel v. Smith, 128 Ohio

St.3d 390, 2011-Ohio-957, 944 N.E.2d 1166 (imposing an indefinite suspension

with credit for time served on an attorney convicted of conspiracy to defraud the

IRS, making false tax returns, and corruptly endeavoring to impede an IRS

investigation); and Disciplinary Counsel v. Bennett, 124 Ohio St.3d 314, 2010-

Ohio-313, 921 N.E.2d 1064 (imposing an indefinite suspension with credit for

time served under an interim felony suspension and conditioning reinstatement on

the completion of supervised release on an attorney convicted of illegally

structuring financial transactions to evade federal reporting requirements).

{¶ 15} In this case, McGowan has engaged in illegal conduct involving

dishonesty, fraud, deceit, or misrepresentation, neglected two client matters, failed

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to deliver funds that a client was entitled to receive, failed to reasonably

communicate with a client, and failed to advise a client that he did not carry

professional liability insurance. He also failed to cooperate in the ensuing

disciplinary proceedings until after relator had filed its complaint with the board.

It is undeniable that his actions adversely reflect upon his honesty,

trustworthiness, and fitness to practice law. Therefore, we adopt the parties’

stipulations of fact, misconduct, and aggravating and mitigating factors as adopted

by the board.

{¶ 16} Of the cases that the board cited in support of its recommended

sanction, we find the facts in Hunter to be most comparable to the facts of this

case. Like McGowan, Hunter not only committed felony offenses involving the

failure to report cash transactions of more than $10,000 to the IRS but also

neglected and failed to communicate with clients regarding the status of their

legal matters. Id. at ¶ 4, 6, and 8. While McGowan was also convicted of

conspiring to commit money laundering, Hunter was convicted of failing to report

a cash payment in excess of $10,000. He also failed to maintain adequate

accounting and reconciliation procedures for his client trust account, causing him

to overdraw the account on two separate occasions. Id. at ¶ 12. The key

difference between these cases, however, is that Hunter made full and free

disclosure to the board and demonstrated a cooperative attitude toward the

disciplinary proceedings. Id. at ¶ 15; see BCGD Proc.Reg. 10(B)(2)(a) and (d).

McGowan, in contrast, failed to respond to the disciplinary investigation until

after the complaint had been filed. This fact also distinguishes McGowan’s

conduct from that of Smith and Bennett. See Smith, 128 Ohio St.3d 390, 2011-

Ohio-957, 944 N.E.2d 1166, at ¶ 11; Bennett, 124 Ohio St.3d 314, 2010-Ohio-

313, 921 N.E.2d 1064, at ¶ 23.

{¶ 17} Based on McGowan’s failure to cooperate in the disciplinary

investigation and his ongoing federal supervised release—which it appears will

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not terminate until July 2014—we decline to credit McGowan for the time he has

served under his interim felony suspension. We adopt the board’s recommended

sanction in all other respects.

Conclusion

{¶ 18} Accordingly, Charles William McGowan is indefinitely suspended

from the practice of law in Ohio. He shall not be permitted to petition for

reinstatement until he has completed the term of federal supervised release

imposed against him in United States v. McGowan, S.D. Ohio No. 2:09cr285

(Dec. 2, 2010), made restitution of unearned fees to his clients, including $600 to

Pyles, reimbursed the Clients’ Security Fund for any claims paid to his clients,

and paid the costs necessary to prosecute this action. Costs are taxed to

McGowan.

Judgment accordingly.

O’CONNOR, C.J., and LANZINGER, KENNEDY, and FRENCH, JJ., concur.

PFEIFER, O’DONNELL, and O’NEILL, JJ., dissent and would grant

McGowan credit for time served under his interim felony suspension.

__________________

Jeffrey C. Rogers; and Bruce A. Campbell, Bar Counsel, and A. Alysha

Clous, Assistant Bar Counsel, for relator.

Charles McGowan, pro se.

______________________

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