BEFORE THE HEARING BOARD
OF THE
ILLINOIS ATTORNEY REGISTRATION
AND
DISCIPLINARY COMMISSION

In the Matter of:

MICHAEL JOHN CAITHAMER,

Attorney-Respondent, 

No. 6197169.

 

Commission No. 2012PR00079

FILED - July 24, 2012

COMPLAINT

Jerome Larkin, Administrator of the Attorney Registration and Disciplinary Commission, by his attorney, Albert S. Krawczyk, pursuant to Supreme Court Rule 753(b), complains of Respondent, Michael John Caithamer, who was licensed to practice law in the State of Illinois on February 9, 1988, and alleges that Respondent has engaged in the following conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute, and which subjects Respondent to discipline pursuant to Supreme Court Rule 770:

Count I
(Conversion of Funds in Connection with Leslie Greeno and the Estate of Dale Gash)

1. On December 2, 2008, Dale Gash ("Gash") died of injuries he sustained as a result of an incident at or near the intersection of Lewis Avenue and 33rd Street in Zion, Illinois, in which a vehicle operated by Gash and owned by Dorothy Roberts ("Roberts") collided with a vehicle operated by Paul Santana ("Santana").

2. At the time of his death, Gash left no surviving spouse. He left a will naming his stepdaughter Leslie Greeno ("Greeno"), formerly known as Leslie Ann Koskinen, executor of his estate in the event that his wife did not survive him.

3. On December 14, 2008, Respondent agreed to represent Greeno, as the representative of Gash's estate, to seek to recover damages arising from the December 2008 incident referred to in paragraph one, above. Respondent and Greeno agreed that Respondent would be paid a fee equal to one-third of the gross amount that he recovered by settlement without suit being filed or without resolution by arbitration and mediation, or a fee equal to forty percent of the gross amount that he recovered from the claim in the event that there was a recovery resulting from the filing of a lawsuit or any other means of alternate dispute resolution, such as arbitration or mediation. Respondent and Greeno also agreed that Respondent would be paid a fee equal to one-third of the gross amount collected for medical payment if the medical payment was disputed by the insurance carrier involved in the payment.

4. On or about February 4, 2009, Respondent received a communication from Founders Insurance Company stating that it had denied insurance coverage on behalf of Santana in connection with the December 2008 incident, because the accident occurred during a lapse in coverage due to the non-payment of the insurance premium.

5. Between February and March 2009, Respondent made an uninsured motorist claim on behalf of Greeno and Gash's estate with Roberts' insurer, American Family Insurance Group ("American Family Insurance"), settled the claim in exchange for the payment of Roberts' policy limits of $100,000 on the uninsured motorist claim and the policy limits of $10,000 for medical expenses, and provided American Family Insurance with copies of Gash's medical bills and funeral expenses, a signed release and a small estate affidavit. Thereafter, Respondent requested American Family Insurance to hold off payment until he could resolve a lien that Medicare asserted on the proceeds of the settlement.

6. On or about December 17, 2009, Respondent received a letter on behalf of Medicare stating that Medicare had determined that Gash's estate was required to repay the Medicare program $1,501.40 for the cost of medical care Medicare had paid in connection with Gash, and, on December 19, 2009, Respondent requested American Family Insurance to issue a payment of $1,501.40 to Medicare and Gash's estate and distribute the balance of $108,498.60 to Greeno, as executor of the estate, and to Respondent.

7. On December 23, 2009, pursuant to Respondent's request, American Family Insurance issued checks in the amount of $1,501.40 and $108,498.60 in connection with the claims made by Greeno on behalf of Gash's estate. Respondent received the $108,498.60 check shortly after it was issued, but he did not receive, or he received and misplaced, the $1,501.40 check.

8. On December 30, 2009, Respondent deposited the $108,498.60 check issued by American Family Insurance into a JP Morgan Chase Bank, N.S. ("Chase Bank") account with an identifying number ending in 957. That account was entitled "Michael J. Caithamer & Associates Ltd. IOLTA Trust Account" ("Respondent's client funds account") and was used by Respondent for the deposit and disbursement of funds of clients or third persons in Respondent's possession.

9. As of December 30, 2009, Greeno and/or Gash's estate were entitled to or had an interest in at least $71,685.98 of the total funds then deposited into Respondent's client funds account after deductions from the proceeds of the $108, 498.60 check, for attorney's fees in no more than $36,666.67 and Respondent's expenses in the amount of $145.95.

10. On January 5, 2010, Respondent drew and Chase Bank paid check number 1185 on Respondent's client funds account. Check number 1185 was made payable to Respondent in the amount of $4,000, and bore the memo "D Gash v Roberts D/A 12/2/08 Legal Fee. Medpay."

11. From February 19, 2010 to June 15, 2010, Respondent drew, and Chase Bank paid, nine checks on Respondent's client funds account that Respondent had made payable to Respondent totaling $16,000. Each check bore the memo "D Gash v. Santana Legal Fees" or similar words.

12. Between February 19, 2010 and June 15, 2010, Respondent issued checks and caused other withdrawals to be made against Respondent's client funds account for the purpose of paying Respondent's own business and personal expenses unrelated to Greeno or Gash's estate, causing the balance in the account to fall to $56,963.39.

13. As of June 15, 2010, Respondent used $14,722.59 of the funds deposited into Respondent's client funds account to which Greeno and/or Gash's estate were entitled to or had an interest, for Respondent's own business and personal purposes.

14. At no time did Greeno or anyone else on behalf of Gash's estate authorize Respondent to use any portion of the $14,722.59 in funds, described in paragraph thirteen above, for Respondent's own business or personal purposes.

15. By reason of the conduct outlined above, Respondent has engaged in the following misconduct:

a. conversion;

b. conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010); and

c. conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute.

COUNT II
(Misrepresentations to Leslie Greeno's New Counsel)

16. The Administrator realleges paragraphs 1 through 14 of Count I, above.

17. As of June 2010, Respondent made no payments to Greeno on behalf of Gash's estate, and, in or before June 2010, Greeno discharged Respondent from representing Greeno and the estate.

18. On or about June 25, 2010, Respondent received a communication from attorney Robert J. Hauser ("Hauser") advising Respondent that Hauser had been retained by Greeno, on behalf of her and Gash's estate, and asking Respondent to forward to Hauser copies of any documents that he might have regarding Greeno's case.

19. In a telephone conversation with Hauser on June 28, 2010, Respondent stated that American Family Insurance had already tendered the $100,000 policy limits and that Respondent was attempting to resolve the monies owed to Medicare before the funds could be obtained and subsequently distributed. Thereafter, in a letter to Hauser dated June 30, 2010, Respondent stated that "[w]e have been communicating with Medicare to determine what amount of disbursement is due and owing to them."

20. Respondent's statements to Hauser, as set forth in paragraph 19 above, were false and misleading in that Respondent knew as of December 2009 that Medicare had determined that Gash's estate was required to repay the Medicare program $1,501.40.

21. In or before July 2010, Hauser learned that American Family Insurance had issued two checks in December 2009, in connection with the claims of Greeno and Gash's estate.

22. In a letter to Respondent dated July 6, 2010, Hauser told Respondent that one of the staff counsel for American Family Insurance told him that two checks had been issued. At that time, Hauser requested that Respondent provide an accounting of the funds that Respondent received and an explanation as to why the monies had not been distributed to Gash's estate and/or his rightful heirs.

23. In a letter dated July 9, 2010, Respondent advised Hauser that the settlement funds were being held in a secured client trust account, and that after deducting legal fees (of 40%) and files costs and medical expenses, Gash's estate was entitled to $64,352.65.

24. On July 12, 2010, Hauser asked Respondent to explain, among other things, by July 14, 2010, the basis Respondent charged Gash's estate a 40% fee since the fee agreement specified a fee of 33-1/3% fee unless litigation or arbitration was involved in the recovery.

25. On July 15, 2010, Hauser advised Respondent that he had not received a response to his July 14, 2010, letter to Respondent, that based upon his calculations Gash's estate was due $71,685.98 after deductions of attorney's fees, the Medicare lien and Respondent's costs, and that Respondent should immediately provide a check to Hauser payable to Gash's estate and Hauser as its attorney.

26. As of July 1, 2010, the balance in Respondent's client funds account was $56,963.39. Thereafter, on July 9, 2010 and July 15, 2010, Respondent caused two separate deposits of $7,500 each to be made into Respondent's client funds account.

27. In July 2010, Respondent caused a check to be delivered to Hauser in the amount of $71,685.98, and, in August 2010, Respondent obtained a replacement check in the amount of $1,501.40 from American Family Insurance and caused the check to be delivered to an agent of the Medicare program in connection with Gash's estate.

28. By reason of the conduct outlined above, Respondent has engaged in the following misconduct:

a. failing to promptly notify and pay or deliver to a client funds which the client is entitled to receive in violation of Rule 1.15(d) of the Illinois Rules of Professional Conduct (2010);

b. conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010); and

c. conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute.

Count III
(Attempt to Obstruct Service of a Rule to
Show Cause in Martha Wheeler's Personal Injury Suit
)

29. On March 10, 2008, Respondent caused a complaint to be filed on behalf of Martha A. Wheeler ("Wheeler") against Veronica Guzman-Manjarrez ("Guzman-Manjarrez") and Jose Cespi ("Cespi") in the Circuit Court of the Nineteenth Judicial Circuit, Lake County, Illinois, in the matter entitled Martha A. Wheeler vs. Veronica Guzman-Manjarrez and Jose Cespi, case number 08 AR 310, claiming that Wheeler was injured as a result of an incident in which a vehicle operated by Wheeler collided with a vehicle owned by Cespi and operated by Guzman-Manjarrez.

30. On June 17, 2010, an arbitration hearing was held in case number 08 AR 310. At that time, Respondent submitted a package of records consisting of medical bills and other documents to the arbitrators pursuant to Illinois Supreme Court Rule 90(c) ("Rule 90(c) package"), and the arbitrators entered an award of $13,000 plus costs in favor of Wheeler.

31. In July 2010, the defendants in case number 08 AR 310, by their attorneys, filed a notice of rejection of the arbitrators' award and a motion for a rule to show cause why Wheeler and Respondent should not be held in contempt of court. The motion also requested the dismissal of the complaint and sanctions, claiming that the Rule 90(c) package submitted by Respondent at the arbitration hearing contained a report from a doctor dated June 16, 2010, that was not previously submitted by Respondent to the defense as part of Wheeler's Rule 90(c) package pursuant to the rule.

32. On September 1, 2010, the court in case number 08 AR 310 granted the motion to issue a rule to show cause against Respondent, and set a return date of September 29, 2010, in the matter. At that time, the court entered an order and rule to show cause, and Respondent declined to waive personal service of the order.

33. On September 9, 10 and 13, 2010, a Lake County sheriff's deputy did not find Respondent at his law office in Grayslake, Illinois, for service of the order and rule to show cause entered September 1, 2010, in case number 08 AR 310, and, on September 15, 2010, the sheriff's deputy called and left a message for Respondent to return his call.

34. At all times related to the events in this complaint, under Chapter 720, Act 5, Section 31-3, of the Illinois Compiled Statutes, as amended, whoever knowingly resists or obstructs the authorized service or execution of any civil or criminal process or order of any court commits a Class B misdemeanor, and under Chapter 720, Act 5, Section 8-4, of the Illinois Compiled Statutes, as amended, a person commits the offense of attempt when, with intent to commit a specific offense, he or she does any act that constitutes a substantial step toward the commission of that offense.

35. On September 17, 2010, a Lake County sheriff's deputy went to Respondent's law office in Grayslake, Illinois, to serve the order and rule to show cause. At that time, the deputy sheriff told Respondent that he had a rule to show cause order to serve on Michael Caithamer. Respondent falsely identified himself as "Mark Penner" and told the deputy sheriff that Michel Caithamer was not in the office. After the sheriff's deputy told Respondent that a vehicle registered to Michael Caithamer was parked in front of the office, Respondent stated that Michael Caithamer was on vacation and would be back some time the next week. Respondent stated that he leased office space from Michael Caithamer and that he would give him a copy of the order, but the sheriff's deputy told him that rule to show cause had to be personally served.

36. On September 17, 2010, the sheriff's deputy left Respondent's office and used the Illinois Secretary of State image retrieval system to obtain a driver's license photo of Michael Caithamer. After the sheriff's deputy learned that the person who identified himself as Mark Prenner was Michael Caithamer, he returned to the office and he placed Respondent under arrest for obstructing service of process. At that time, Respondent stated that he was sorry and promised to appear in court.

37. On or before October 4, 2010, as a result of the acts described in paragraph 35, above, the State's Attorney of Lake County, Illinois, charged Respondent with the offense of obstructing service of process, in that he knowingly obstructed the authorized service, being a court order and rule to show cause, on Respondent by a Lake County sheriff's deputy by providing the sheriff's deputy a false name, in violation of 720 ILCS 5/31-3. The matter was docketed as People of State of Illinois vs. Michael Caithamer, case number 10 CM 4965.

38. On May 9, 2012, as a result of a negotiated plea, the court in case number 10 CM 4965 found Respondent guilty of attempt obstructing service of process, sentenced him to one year of court supervision and ordered him to pay court costs and a monitored court supervision fee of $50.

39. As a result of the judgment of supervision and the conduct described above, Respondent has engaged in the following misconduct:

a. committing a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects, in violation of 720 ILCS 5/8-4, 720 ILCS 5/31-3 and Rule 8.4(b) of the Illinois Rules of Professional Conduct (2010);

b. conduct involving dishonesty, fraud, deceit or misrepresentation, in violation of Rule 8.4(c) of the Illinois Rules of Professional Conduct (2010); and

c. conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute.

WHEREFORE, the Administrator requests that a hearing be conducted before a panel of the Hearing Board, and that the panel make findings of fact, conclusions of facts and law, and a recommendation for such discipline as is warranted.

Albert S. Krawczyk
Counsel for Administrator
One Prudential Plaza
130 East Randolph Drive, #1500
Chicago, Illinois 60601
Telephone: (312) 565-2600
Facsimile: (312) 565-2320
Respectfully submitted,

Jerome Larkin, Administrator
Attorney Registration and
Disciplinary Commission

By:  Albert S. Krawczyk