In re Sutton - (, 117395

Background

Brandy L. Sutton, admitted in Kansas in 1998, owned the law firm Pendleton & Sutton and offered a SIMPLE IRA plan with a 3% employer match for employees.
Sutton withheld employees' IRA contributions from paychecks but failed, for years, to timely deposit those withheld employee contributions and employer matches into the employees' SIMPLE IRA accounts; paystubs nonetheless indicated deposits had been made.
A former associate (L.M.) discovered discrepancies upon leaving in May 2015, demanded payment, filed a disciplinary complaint, and Sutton eventually made corrective deposits after a manual review and later Department of Labor guidance.
The disciplinary hearing panel found Sutton violated KRPC 8.4(c) (dishonesty, fraud, deceit, or misrepresentation), identified aggravating and mitigating factors, and recommended three years' probation under a detailed supervised plan.
The Kansas Supreme Court concluded Sutton’s conduct amounted to conversion of employee funds and imposed a three‑year suspension, but allowed Sutton to apply for early reinstatement after six months if she presents an approved 30‑month probation/supervision plan.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Sutton violated KRPC 8.4(c) by withholding and failing to deposit employee IRA contributions while representing on paystubs that deposits were made	Sutton engaged in dishonesty and misrepresentation toward employees	Sutton attributed failures to financial hardship, mental health issues, and later corrected the accounts	Court held Sutton violated KRPC 8.4(c) (dishonesty/conversion)
Whether probation is an appropriate sanction or whether suspension is required	Disciplinary Administrator argued suspension (indefinite preferred)	Sutton sought probation under a monitoring plan and pointed to mitigation and corrective payments	Court declined probation; imposed a three‑year suspension, with possible early reinstatement after 6 months conditioned on approved supervision plan
Role of misconduct characterization (conversion) in determining discipline	Administrator emphasized seriousness of conversion warranting harsher discipline	Sutton argued mitigation (no prior discipline, mental health treatment, restitution) justified probation	Court treated conversion of employee funds as requiring more stringent discipline than probation
Reinstatement conditions and early reinstatement possibility	Administrator sought meaningful supervision before reinstatement	Sutton requested early reinstatement under her proposed plan	Court allows motion for early reinstatement after 6 months only if she first obtains written approval of a 30‑month probation/supervision plan acceptable to the Disciplinary Administrator and files it with the motion

Key Cases Cited

In re Harrington, 305 Kan. 643 (2016) (conversion by attorney supports severe discipline)
In re Davis, 296 Kan. 531 (2013) (conversion of funds as aggravating misconduct)
In re Holmes, 293 Kan. 478 (2011) (discipline for dishonest conversion of funds)
In re Thomas, 291 Kan. 443 (2010) (suspension for misuse of client funds)
In re Pattison, 284 Kan. 232 (2007) (conversion justifies harsher sanction than probation)
In re Stockwell, 296 Kan. 860 (2013) (court reluctance to grant probation where misconduct involves fraud or dishonesty)
In re Foster, 292 Kan. 940 (2011) (standard of review: attorney misconduct proven by clear and convincing evidence)
In re Lober, 288 Kan. 498 (2009) (definition of clear and convincing evidence)
In re Dennis, 286 Kan. 708 (2008) (clear-and-convincing standard explained)