IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD, Complainant, v. Robert Allan WRIGHT Jr., Respondent.
No. 13-0780.
Supreme Court of Iowa.
Dec. 6, 2013.
295
Alfredo G. Parrish of Parrish, Kruidenier, Dunn, Boles, Gribble, Parrish, Gentry & Fisher, LLP, Des Moines, for respondent.
HECHT, Justice.
The Iowa Supreme Court Attorney Disciplinary Board (Board) charged Robert Wright Jr. with violations of the Iowa Rules of Professional Conduct based on Wright‘s conduct in persuading several of his clients to loan money to another client. A division of the Grievance Commission of the Supreme Court of Iowa found Wright‘s actions violated several ethical rules and recommended a suspension of his license to practice law. Wright has appealed from the commission‘s recommendation. After reviewing the record, we find Wright committed ethical violations warranting a suspension.
Wright was admitted to the bar and began practicing law in 1981. He developed a general practice, handling criminal cases, family law matters, personal injury and workers’ compensation claims, and employment discrimination cases. While representing Floyd Lee Madison in a criminal case in 2011, Wright was presented with documents purporting to evidence that Madison was the beneficiary of a large bequest from his long-lost cousin in Nigeria. Madison represented to Wright that upon payment of $177,660 in taxes owed on the inheritance in Nigeria, the sum of $18,800,000 would be released to Madison. He asked Wright to represent him in securing the transfer of the funds from Nigeria. In consideration for a fee equal to ten percent of the funds recovered, Wright agreed to represent Madison in the Nigerian transaction.
Wright was at that time representing Danny Wayne Rynearson in a pending felony criminal case. Wright knew Rynearson might have funds that Madison could borrow for the purpose of paying the taxes and fees on the Nigerian funds. Armed with this knowledge, Wright approached Rynearson about his willingness to make a loan to Madison. Wright arranged a meeting in his office between Madison, Rynearson, and Rynearson‘s wife. As a consequence of the meeting, the Rynearsons agreed to make the loan to Madison and drew a check on June 9, 2011, in the amount of $12,000 payable to Wright. Wright prepared and signed a letter dated June 9, 2011, confirming the agreement that his client Rynearson would loan Madison the sum of $12,000 for the purpose of paying the Nigerian tax. Madison signed the document promising to pay Rynearson the sum of $50,000 “upon receipt of [the] inheritance funds.” Wright deposited Rynearson‘s check in his trust account. Believing more funds were needed to complete the transaction, Wright informed the Rynearsons that he was in immediate need of an additional $12,500 and desperately needed their help. Mrs. Rynearson drew a check in the amount of $12,500 payable to Wright on August 1, 2011. Wright also deposited that check in his trust account.1
Wright was also representing Linda Putz at that time in a pending workers’ compensation case. The case was nearing completion, and Wright and Putz were awaiting receipt of proceeds of a settlement. Knowing Putz would soon net approximately $25,000 from the settlement, Wright informed her Madison hoped to borrow money to pay Nigerian authorities for an “anti-terrorism certificate” and inquired whether Putz would be willing to loan the sum of $12,500 for this purpose. In a letter to Putz dated August 12, 2011, Wright memorialized a proposed loan agreement calling for Madison to repay the loan with a payment of $50,000 upon his receipt of the inheritance which was anticipated “before August 24, 2011.” Putz later agreed to loan Madison an additional $12,500, and thus loaned the entire
The Board subsequently filed a complaint alleging Wright had violated several rules of professional conduct in his transactions with Danny Wayne Rynearson and Putz. Shortly before the hearing on the complaint in front of the grievance commission, Wright presented to the Board a “Disclosure Statement” revealing for the first time that he had also solicited loans for Madison from three other clients in furtherance of the Nigerian transaction.2 The statement admitted Wright had solicited and received from Toryan White a loan for Madison in the amount of $7000. The statement also revealed Wright solicited a loan for Madison from another client, Vern Stodden, in the amount of $160,000.3 Lastly, the statement disclosed Wright had solicited and obtained for Madison a loan in the amount of $20,000 from Bob Nunneman. Wright stipulated that he failed to advise White, Stodden, and Nunneman that they should seek independent counsel before making the loans to Madison. Denying that he derived any financial gain from these transactions, Wright urged the grievance commission to consider his voluntary disclosure as a mitigating factor in its determination of the appropriate sanction in this case.
Although Wright‘s disclosures of additional loan transactions on the eve of the hearing before the commission were a surprise to the Board, no objection was raised to the disclosure statement when it was offered and received in evidence by the grievance commission. In its posthearing brief, the Board urged that Wright‘s admitted conduct in the transactions with White, Stodden, and Nunneman be considered as an aggravating factor in the determination of the appropriate sanction for any violations committed in the transactions with Rynearson and Putz, on the ground that Wright‘s conduct involving White, Stodden, and Nunneman was part of a pattern arising from the same Nigerian transaction for which loans made by Rynearson and Putz were solicited.
In the course of his work on behalf of Madison in pursuit of the Nigerian inheritance, Wright communicated with persons he believed were representatives of the “Central Bank of Nigeria,” the “African Union,” and the President of Nigeria. Wright also communicated with Okey Okafor, a person who claimed to be the Nigerian lawyer who had witnessed the decedent‘s will. Wright also had communications with a person who claimed to be a lawyer in England named Johnson Walkers. Walkers claimed he had, on Madison‘s behalf, traveled to Nigeria and investigated the legitimacy of the inheritance.
Madison recovered no funds from the supposed Nigerian inheritance. As no funds were recovered by Madison, Wright received no compensation for his professional services in the matter. The loans made to Madison by the Rynearsons, Putz, White, Stodden, and Nunneman have not been repaid.
Wright‘s license is currently suspended under an order of this court entered on August 16, 2012. The current suspension was imposed as a consequence of Wright‘s failure to cooperate with the efforts of the Client Security Commission to perform an audit of his lawyer trust account.
II. The Board‘s Complaint.
The Board filed a complaint alleging Wright‘s conduct in the transactions with Rynearson and Putz violated the following rules: (1)
III. The Commission‘s Report.
The Board‘s posthearing brief withdrew the allegation that Wright violated
The commission‘s report found by a convincing preponderance of the evidence that Wright‘s conduct in his transactions with Madison, Rynearson, and Putz violated each of the other rules as alleged in the Board‘s complaint. The commission‘s findings of violations were also based on Wright‘s conduct in soliciting loans from White, Stodden, and Nunneman based on the substance of Wright‘s disclosure statement.6 The report recommends a lengthy suspension be imposed.7
IV. Scope of Review.
We review the commission‘s report de novo. Iowa Supreme Court Attorney Disciplinary Board v. Howe, 706 N.W.2d 360, 366 (Iowa 2005). “Under this standard of review, we give weight to the factual findings of the Commission, especially with respect to witness credibility, but we find the facts anew.” Iowa Supreme Court Board of Professional Ethics & Conduct v. Beckman, 674 N.W.2d 129, 131 (Iowa 2004). “Although we respectfully consider the discipline recommended by the Commission, the final decision on the appropriate sanction is for this court.” Howe, 706 N.W.2d at 366. The Board, as the complainant, must prove its allegations of misconduct by a convincing preponderance of the evidence. Id.
V. Violations.
A. Rule 32:1.1.
Wright is not the first Iowa lawyer who has become entangled in a deception with ostensible Nigerian connections. See Iowa Supreme Court Board of Professional Ethics & Conduct v. Jones, 606 N.W.2d 5, 9 (Iowa 2000) (noting the incidence of fraudulent transactions with purported connections to the country of Nigeria). Lawyers in other jurisdictions have also been entangled and deceived in such schemes in recent years. See, e.g., In re Maxwell, 334 B.R. 736, 738-41 (Bankr. M.D. Fla. 2005); Parker v. Williams, 977 So. 2d 476, 477-78 (Ala. 2007); Lappostato v. Terk, 143 Conn. App. 384, 71 A.3d 552, 559-60 (2013); In re Reinstatement of Jones, 203 P.3d 909, 912-13 (Okla. 2009); see also Lucas v. BankAtlantic, 944 So. 2d 1031, 1032 (Fla. Dist. Ct. App. 2006) (describing a deception originating in Africa). The Board‘s evidence in this case established that a cursory internet search using the query “anti-terrorism certificate” in early 2011 would have revealed evidence that Madison‘s dream of a Nigerian inheritance was probably based on a scam.
Although Wright apparently communicated with persons holding themselves out as attorneys, diplomats, representatives of the Nigerian government, the “Central Bank of Nigeria,” the Canadian Department of Justice, the Royal Bank of Canada, and “a special adviser (sic) to the President [of Nigeria] on financial matters,” he failed to verify that any of them were who they claimed to be. And although Wright received documents purporting to be a last will and testament, a death certificate, and an “Anti Terrorist Clearance Certificate,” they were facially of doubtful validity. Without confirmation of the authenticity of the documents, the authority of the persons he was dealing with, or the existence of the allegedly inherited funds, Wright apparently disbursed more than $200,000 in pursuit of the scam. We find Wright violated
B. Rule 32:1.8(a). The Iowa Rules of Professional Conduct regulate lawyers’ business transactions with “current clients.”
This rule provides in relevant part:
a. A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security, or other pecuniary interest adverse to a client unless:
(1) the transaction and terms on which the lawyer acquires the interest are fair and reasonable to the client and are fully disclosed and transmitted in writing in a manner that can be reasonably understood by the client;
(2) the client is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel on the transaction; and
(3) the client gives informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer‘s role in the transaction, including whether the lawyer is representing the client in the transaction.
We conclude Wright‘s undisclosed contingent fee interest in Madison‘s inheritance claim constituted a pecuniary interest that was adverse to the interests of Rynearson and Putz. Madison and Wright urgently desired to obtain the funds to pay the taxes and fees demanded by the persons who claimed control of the Nigerian inheritance. The willingness of Madison and Wright to risk their own time and resources on a transparently dubious enterprise may not have been identical to the willingness Rynearson and Putz had regarding the enterprise. Wright failed to advise Rynearson and Putz they should seek advice from an independent lawyer on the risky loan transactions. As we have already noted, Wright failed to obtain the
We analyze separately Wright‘s conduct in soliciting and completing the loan transactions with White, Stodden, and Nunneman. As we have noted, Wright was not engaged in the current representation of these three persons when he solicited loans from them on behalf of Madison. The record does not reveal the details of the matters for which Wright represented White, Stodden, and Nunneman, and it does not disclose the time period in which those former attorney-client relationships existed. Thus, on this record, we find the Board failed to prove these three persons were Wright‘s “current clients” when he solicited loans from them for Madison. Accordingly, we find no violation of
C. Rules 32:1.7, 32:1.8(b). The Board also charged Wright with violation of
Rule 32:8.4(c). The Board‘s complaint charged Wright with violation of
VI. Sanction.
When deciding on an appropriate sanction for an attorney‘s misconduct, we consider
Iowa Supreme Court Attorney Disciplinary Board v. Walker, 712 N.W.2d 683, 685 (Iowa 2006) (quoting Iowa Supreme Court Board of Professional Ethics & Conduct v. Honken, 688 N.W.2d 812, 820 (Iowa 2004)) (internal quotation marks omitted). “There is no standard sanction for a particular type of misconduct, and though prior cases can be instructive, we ultimately determine an appropriate sanction based on the particular circumstances of each case.” Iowa Supreme Court Attorney Disciplinary Board v. Earley, 774 N.W.2d 301, 308 (Iowa 2009).
The range of sanctions imposed upon attorneys engaging in representation of clients in violation of conflict of interest rules and engaging in misrepresentation or deceit resulting in a client‘s financial loss has spanned a continuum from a suspension of two months to a revocation of a license to practice law depending on the severity of the violations. See Jones, 606 N.W.2d at 9 (imposing two-month suspension); Comm. on Prof‘l Ethics & Conduct v. Hall, 463 N.W.2d 30, 35-36 (Iowa 1990) (citing cases imposing sanctions up to and including revocation depending on nature and extent of violations).
In determining the appropriate sanction in this case, we consider aggravating factors supported by the evidence. We note the violations committed by Wright involved a course of conduct involving multiple clients who together lost substantially more money than was lost by the unwitting lender in Jones. See Jones, 606 N.W.2d at 9. Generally, “more severe discipline is warranted when the ethical violations cause harm to clients.” Iowa Supreme Court Board of Professional Ethics & Conduct v. Jay, 606 N.W.2d 1, 4 (Iowa 2000). Our calibration of the sanction also requires us to consider the fact that Wright is an experienced lawyer with more than thirty years of practice behind him. Iowa Supreme Court Board of Professional Ethics & Conduct v. Wagner, 599 N.W.2d 721, 730 (Iowa 1999). We consider Wright‘s prior record of three private admonitions and two public reprimands as an additional aggravating factor affecting our decision. See Iowa Supreme Court Board of Professional Ethics & Conduct v. McKittrick, 683 N.W.2d 554, 563 (Iowa 2004).
We also consider at this juncture mitigating factors supported by the evidence in this case. Wright has a long history of pro bono service to indigent clients and dedication to public service.
We recognize that “[t]he canons of ethics are not primarily intended to mete out abstract justice to wayward attorneys, but rather are chiefly intended to provide protection to the public.” Iowa Supreme Court Board of Professional Ethics & Conduct v. Scieszinski, 599 N.W.2d 472, 474 (Iowa 1999). Having considered all of the factors bearing upon the selection of an appropriate sanction in this case, we conclude a suspension of twelve months should be imposed here. This suspension should begin at such time as the temporary suspension of Wright‘s license imposed by this court on August 16, 2012, is lifted.8
We suspend Wright‘s license to practice law in this state with no possibility of reinstatement for a period of no less than twelve months. This suspension applies to all facets of the practice of law, including but not limited to advertising his services. See Iowa Ct. R. 35.13(3). The period of suspension shall commence at such time as this court enters an order lifting the temporary suspension now in place. Prior to any reinstatement of his license to practice law following the period of suspension ordered in this opinion, Wright shall establish that he has not practiced law during the period of suspension, that he has conformed to the rules and procedures governing reinstatement set forth in rule 35.13, and that he has complied with the notification requirements in rule 35.22. We tax the costs of this proceeding to Wright pursuant to rule 35.27(1). Iowa Ct. R. 35.27(1).
LICENSE SUSPENDED.
Notes
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