Iowa Supreme Court Attorney Disciplinary Board v. Michael Gerard Reilly
884 N.W.2d 761
Iowa2016Background
- Michael G. Reilly was admitted in Iowa (1981) and Nebraska (1982); his Iowa law license was revoked in 2006 for misappropriating client settlement funds tied to a conservatorship while he suffered a gambling addiction. The Nebraska Supreme Court later disbarred him in a reciprocal proceeding.
- Reilly deposited settlement funds into personal accounts, kited checks, caused a bank overdraft that prompted federal notification, and eventually repaid banks and clients. The Grievance Commission originally recommended a three-year suspension, but this court revoked his license.
- Reilly first sought reinstatement in 2009 and was denied under the then-applicable understanding that revocations are ordinarily permanent (Brodsky).
- Iowa amended its rules (Iowa Ct. R. 34.25) to provide a formal reinstatement procedure; Reilly reapplied in 2015, submitted treatment records, character letters, credit report, and a professional gambling-evaluation showing long-term remission.
- The Iowa Board of Law Examiners initially split but later (after supplemental materials and interview) recommended reinstatement by majority; the Attorney Disciplinary Board opposed reinstatement, arguing misappropriation renders a lawyer ineligible.
- The Supreme Court, applying de novo review and the rule’s standards, provisionally granted reinstatement subject to conditions (MPRE score, CLE hours including ethics, malpractice insurance if in private practice), finding Reilly met the convincing-preponderance burden of current moral character and fitness.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a lawyer whose license was revoked for misappropriating funds can obtain reinstatement under Iowa Ct. R. 34.25 | Board: revocation for conversion with no colorable claim is ordinarily permanent; such conduct shows lack of fundamental honesty, so reinstatement should be denied | Reilly: has undergone treatment, long-term remission, remorse, restitution, character support, and now satisfies the rule’s burden for readmission | Court: Reilly met the convincing-preponderance standard; reinstatement provisionally granted with conditions |
| Appropriate standard and factors for evaluating reinstatement applications | Board: rely on Brodsky presumption against readmission; treat conversion cases as generally ineligible | Reilly: compliance with new rule’s procedures and evidence of rehabilitation should govern | Court: adopted detailed multi-factor assessment (nature of misconduct, recognition/remorse, candor, rehab for causative conditions, passage of time and conduct since revocation, references, other evidence) and applied it de novo |
| Burden of proof and review standard for reinstatement | Board: heavy burden; revocation suggests permanence | Reilly: submitted evidence to meet burden | Court: applicant bears burden of convincing preponderance; court reviews de novo and concluded burden satisfied here |
| Conditions to impose upon reinstatement after prolonged revocation | Board: argued reinstatement should be denied rather than conditioned | Reilly: sought reasonable conditions, not necessarily bar exam | Court: declined to require bar exam, required 30 CLE hours (3 ethics), MPRE ≥80, and maintenance of malpractice insurance if in private practice; deadline for meeting preconditions set |
Key Cases Cited
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Reilly, 708 N.W.2d 82 (Iowa 2006) (original disciplinary opinion revoking Reilly’s Iowa license)
- State ex rel. Counsel for Discipline of Neb. Supreme Ct. v. Reilly, 712 N.W.2d 278 (Neb. 2006) (reciprocal disbarment in Nebraska)
- Committee on Professional Ethics & Conduct v. Brodsky, 487 N.W.2d 674 (Iowa 1992) (statement that revocations are ordinarily permanent; rare readmissions)
- Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Hansel, 558 N.W.2d 186 (Iowa 1997) (illness does not excuse dishonest conduct)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. McCarthy, 814 N.W.2d 596 (Iowa 2012) (definition of convincing preponderance standard)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Stowe, 830 N.W.2d 737 (Iowa 2013) (reinstatement review is de novo)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Barnhill, 847 N.W.2d 466 (Iowa 2014) (primary goal of discipline is public protection)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Santiago, 869 N.W.2d 172 (Iowa 2015) (disciplinary proceedings determine fitness to practice and protect public integrity)