Filed April 18, 2014
In re David Michael Levin
Commission No. 2012PR00040
Synopsis of Review Board Report and Recommendation
This matter arises out of the Administrator's two-count Complaint against Respondent charging him with misconduct based upon his involvement in a debt collection matter while he was under suspension until further order of the Court as a result of a prior disciplinary matter. Count I alleged Respondent engaged in the unauthorized practice of law and dishonesty by agreeing to represent the creditor and undertaking various actions on its behalf. Count II alleged Respondent continued to engage in the unauthorized practice of law, entered into an unauthorized settlement of the matter, converted all of the settlement proceeds, and made misrepresentations.
The Hearing Board found that Respondent engaged in all of the misconduct charged. With respect to Count I, the Hearing Board determined that Respondent's activities, which included drafting a complaint, conducting settlement negotiations, and discussing litigation options and strategies, constituted the practice of law. The Hearing Board further found that Respondent engaged in dishonesty. With respect to Count II, the Hearing Board found that Respondent continued to engage in the unauthorized practice of law by drafting various settlement documents and finalizing a settlement with the debtor. It further found that Respondent engaged in conversion as well as additional acts of dishonesty and deceit by settling the creditor's claim without authorization, converting the entire $24,400 he received in settlement proceeds, and making various false and misleading statements once his actions were revealed. After taking into account the serious nature of the misconduct, Respondent's extensive history of prior discipline, and the other significant aggravating factors, the Hearing Board recommended that Respondent be disbarred.
Upon review, Respondent contended that the Hearing Board erred in some of it factual findings and that his actions did not constitute the practice of law. The Review Board affirmed all of the factual findings of the Hearing Board. The Review Board affirmed all of the findings of misconduct, with the exception of the stand-alone charge of conversion. The Review Board considered the misconduct and the aggravating factors and recommended that Respondent be disbarred.
BEFORE THE REVIEW BOARD
ILLINOIS ATTORNEY REGISTRATION
In the Matter of:
DAVID MICHAEL LEVIN
Commission No. 2012PR00040
REPORT AND RECOMMENDATION OF THE REVIEW BOARD
This is Respondent's fourth disciplinary matter. In 2008, as a result of his third disciplinary prosecution, Respondent was suspended for eighteen months and until further order of the Court. Undeterred by the Court's order suspending him or by any lessons he may have gained in the course of his three prior disciplinary proceedings, Respondent, while suspended as a result of his third disciplinary matter, negotiated a settlement for an old acquaintance, obtained settlement proceeds without notifying the client, and took the settlement proceeds for his own personal expenses.
The Hearing Board found that Respondent practiced law in violation of the Court's 2008 order suspending him, engaged in dishonesty and fraud, engaged in conversion, and engaged in other misconduct as set forth below. The Hearing Board recommended that Respondent be disbarred. Respondent filed exceptions and challenges the findings and the recommendation of the Hearing Board. We affirm the findings of the Hearing Board, with the exception of the stand alone charge of conversion, and recommend to the Court that Respondent be disbarred.
Respondent's Disciplinary History
Respondent was admitted to the practice of law in Illinois in 1974 and in Ohio in 1975. In 2002, Respondent was suspended for ninety days and until he made restitution for issuing checks to pay his secretary that were drawn on an account with insufficient funds and for making misrepresentations in a civil proceeding related to a collection matter. In 2006, Respondent was suspended for six months and was ordered to attend a professionalism seminar for paying a filing fee on an account with insufficient funds and for converting funds tendered to him to pay expenses in two client matters. Following his 2006 suspension in Illinois, the State of Ohio suspended him on a reciprocal basis. He has never been reinstated to the practice of law in Ohio. In 2008, the Illinois Supreme Court disciplined Respondent for a third time, this time for eighteen months and until further order of the Court, for drafting a check for filing fees drawn on an account with insufficient funds, for disclosing confidential client information in a motion to withdraw as counsel, and for threatening disciplinary proceedings to gain an advantage in a civil matter. Respondent has never sought to regain his law license in Illinois.
Respondent's Initial Involvement in the Sace Matter
In 2006, Respondent reconnected with a law school classmate, Roy DeBarbieri, at a friend's wedding. They kept in touch periodically following the wedding. Respondent did not tell DeBarbieri about his disciplinary history, although it is possible that Respondent told him he was not actively practicing.
DeBarbieri practiced law in Connecticut. In 2009, DeBarbieri represented Sace. Sace insured foreign trade credit. Sace had paid out on a claim involving an Ohio company, Seneca Tiles ("Seneca"), who had received a shipment of Italian ceramic tiles from a company in
Italy and had not paid for them. Sace, through its lawyer in Rome, retained DeBarbieri to attempt to collect the debt. DeBarbieri, believing that Respondent was licensed to practice law in Ohio and Illinois, and not knowing that Respondent was suspended from the practice of law, asked Respondent if he would be willing to assist him in this debt collection matter. It was DeBarbieri's practice to hire a local attorney to go directly to the debtor's business to negotiate a settlement. Respondent, without disclosing his suspension from the practice of law, quoted a fee of $275 an hour. DeBarbieri confirmed their agreement by sending a letter to Respondent addressed to "David Levin, Esq.", stating that he was "turning the file over" to Respondent and asking him to negotiate a deal with Seneca. Respondent failed to correct DeBarbieri's misunderstanding as to Respondent's ability to practice law.
Respondent visited Seneca's warehouse and met with the company's owner, Jim Fry. Respondent reviewed Seneca's assets and investigated the company's viability and collectability of the debt. Respondent then, according to DeBarbieri and according to Respondent's subsequent invoice, gave DeBarbieri a legal analysis of the options if they determined that the best course of action was to file a lawsuit against Seneca. DeBarbieri usually communicated with Respondent at his e-mail address, which was Levinlawltd@sbcglobal.net. Respondent claimed they agreed Respondent could take a contingent fee from anything he collected from Seneca. DeBarbieri denied entering into such an agreement and Respondent did not produce such an agreement.
Seneca contended that the company was unable to pay the debt and was contemplating bankruptcy. Consequently, Respondent drafted a complaint against Seneca and showed the draft complaint to Fry in an attempt to settle the dispute. After Seneca continued to decline to pay the debt, Respondent told DeBarbieri that a complaint should be filed in federal
court because there was diversity of citizenship. Respondent drafted the complaint and, after review, DeBarbieri sent it back to Respondent. Respondent then advised, by sending an e-mail to DeBarbieri, that if the client was the assignee, they would need to get an assignment document before the complaint could be filed. DeBarbieri and Respondent had no further communication related to the Seneca matter and DeBarbieri assumed Seneca had filed for bankruptcy.
Respondent's Settlement of the Dispute and Misappropriation of the Settlement Funds
In August 2010, without informing DeBarbieri or Sace, Respondent negotiated a settlement of the matter with Seneca. He surreptitiously prepared a settlement agreement and a promissory note in the amount of $20,400 requiring the debtor, Seneca, to make monthly payments of $1,700.00 personally to him beginning in August 2010. Respondent directed the payments to be sent to him at his home address in Deerfield, Illinois. Respondent did not tell DeBarbieri or Sace he had settled the matter.
Respondent received monthly checks of $1,700.00 from Seneca from August 2010 through July 2011. Respondent spent the proceeds of the checks and gave some of the proceeds to his wife, who was "giving him grief" about not making any money. At no time did he tender any of the proceeds of the checks collected from Seneca to DeBarbieri or to Sace, nor did he inform DeBarbieri of the settlement. As part of the settlement agreement, Respondent arranged to have unsold inventory from Seneca shipped to a warehouse in Cicero, Illinois that was owned by Respondent's cousin. Respondent testified he eventually sold the tile which had a purchase price of $86,000 for $4,000, gave $500 to his cousin for storage, and kept the rest of the money. Respondent produced no documentation for the sale. Respondent retained the funds he received from the sale.
Respondent did not communicate with DeBarbieri or Sace from August 2010 to April 2011. In April 2011, DeBarbieri attempted to contact Respondent about the matter and told Sace that there had been no action on the file "since July 6, 2010, when Attorney David Levin was discussing a partial settlement." In July 2011, Respondent replied to DeBarbieri that he was in the process of moving but did not inform him of the receipt of the money from Seneca. When DeBarbieri finally learned the matter had been settled, Respondent told him he could not provide him with the settlement funds because he had spent them. DeBarbieri then contacted the ARDC, learned of Respondent's disciplinary history, and hired counsel.
Counsel for DeBarbieri communicated with Respondent and Respondent admitted in correspondence that he had collected at least $21,000 and claimed he owed Sace $16,000 after taking his contingent fee. At hearing he conceded he took at least $24,400. He repeatedly told counsel for DeBarbieri that he was holding the funds and would pay the money shortly. In fact, Respondent spent all of the funds. In an e-mail to counsel for DeBarbieri sent in September 2011, Respondent stated, "I am not prohibited from the practice of law but have not chosen to reinstate myself to active status." As of the date of hearing, Respondent had not made any restitution of the funds he took from Seneca that were intended for Sace.
The Hearing Board's Findings of Misconduct
The Administrator filed a two count complaint in this matter. In the first count, the Administrator alleged the facts surrounding Respondent's involvement with DeBarbieri and Sace in 2009 and early 2010 up until the time Respondent had Fry sign the settlement documents on behalf of Seneca in August 2010. Count I generally alleged that Respondent improperly practiced law and engaged in dishonest conduct by assisting DeBarbieri in the collection matter, negotiating with Seneca Tiles and attempting to settle the dispute and by drafting the federal
complaint. Count II alleged that in August 2010 Respondent engaged in the unauthorized practice of law by negotiating the settlement, drafting the settlement agreement and promissory note, signing the settlement agreement as Sace's "agent", and accepting the settlement funds. Count II also charged Respondent with conversion, engaging in dishonest conduct, and engaging in conduct prejudicial to the administration of justice.1
As charged in Count I, the Hearing Board concluded that Respondent practiced law in a jurisdiction where doing so violated the regulation of the profession in that jurisdiction in violation of Rule 5.5. The Hearing Board found that Respondent provided legal services in connection with Sace's collection matter against Seneca Tiles. Specifically, the Hearing Board found the following conduct by Respondent to constitute the practice of law: 1) Respondent's preparation of a draft complaint for potential use in the lawsuit; 2) Respondent's discussion of legal strategies and litigation options with DeBarbieri; 3) Respondent's advice to DeBarbieri regarding selection of a forum for the filing of a lawsuit; 4) Respondent's negotiation of settlement terms with Seneca and his actions in threatening litigation to Seneca. The Hearing Board found that Respondent engaged in conduct involving dishonesty, fraud, deceit, or misrepresentation in violation of Rule 8.4(a)(4) by failing to advise DeBarbieri of his disciplinary status and by deceiving him as to his ability to practice law. The Board also found his unauthorized practice of law to be dishonest. Finally, the Hearing Board found that Respondent engaged in conduct prejudicial to the administration of justice in violation of Rule 8.4(a)(5) by intentionally thwarting the orders in Illinois and in Ohio prohibiting him from practicing law.
With respect to Count II, the Hearing Board also found that Respondent engaged in the unauthorized practice of law in violation of Rule 5.5 by finalizing the settlement, preparing
the settlement agreement and note, and collecting the settlement proceeds. The Hearing Board also found that Respondent engaged in conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(c) by 1) entering into the unauthorized settlement on behalf of Sace; 2) deliberately taking the settlement funds and spending them and by taking the tiles from Seneca and selling them; and 3) making false and misleading statements to DeBarbieri's counsel. Like in Count I, the Hearing Board found Respondent's unauthorized practice to be conduct prejudicial to the administration of justice in violation of Rule 8.4(d).
Respondent argues that he did not engage in the unauthorized practice of law in violation of Rule 5.5 because, as a matter of law, his actions did not involve the "practice of law" in Illinois or Ohio. Instead, he contends he was acting as a paralegal or collection agent. We disagree. While determining what constitutes the practice of law in a jurisdiction defies a mechanistic formulation, we do not have to be na?ve in assessing Respondent's conduct. See, e.g., In re Discipio, 163 Ill.2d 515, 523-524, 645 N.E. 2d 906 (1994). Respondent held himself out as a lawyer and acted as a lawyer. He negotiated settlement terms with Seneca. See, People ex. Rel. Chicago Bar Association v. Goodman, 366 Ill. 346, 8 N.E.2d 941 (1937)(the negotiation of a settlement can constitute the practice of law). DeBarbieri believed Respondent to be authorized to practice law and when writing to DeBarbieri, Respondent used "Esq" at the end of his name, the moniker commonly used in the United States to denote lawyer. Respondent's e-mail address utilized the domain "Levinlawltd", clearly denoting he was engaged in the practice of law. He gave legal advice as to what course of action the client could take if Seneca refused to settle. He advised DeBarbieri about legal strategies, and they discussed the legal ramifications of filing suit. Respondent discussed the proper forum for a suit. He drafted a complaint, with few changes by DeBarbieri because, as DeBarbieri testified,
he was relying on Respondent's legal expertise. Respondent settled a case and drafted the settlement documents. See also, In re Howard, 188 Ill.2d 443, 721 N.E.2d 1126 (1999)(suspended attorney engaged in the unauthorized practice of law by meeting with criminal defendants in jail, accepting a fee, looking at documents related to the case, and giving legal advice to the defendants). In short, he practiced law in direct contravention of the Court's order suspending him from doing so.
While Respondent does not challenge all of the Hearing Board's findings that he engaged in dishonest and fraudulent conduct, he primarily challenges the finding that he engaged in dishonesty because he held himself out a lawyer and deceived DeBarbieri into thinking he was a lawyer. Respondent contends that he did not violate Rule 8.4(a)(4) because he did not affirmatively state he was a lawyer and because the Administrator did not prove he had the requisite intent to deceive. We give deference to the Hearing Board's findings of fact. This Board does not disturb the Hearing Board's factual findings unless they are against the manifest weight of the evidence. In re Timpone, 157 Ill.2d 178, 196, 623 N.E.2d 300 (1993). The Hearing Board's findings of fact are not against the manifest weight of the evidence; they are well supported by the record. The evidence demonstrated Respondent held himself out as a lawyer. Respondent failed to correct DeBarbieri's references to him as a lawyer, Respondent used an e-mail that designated him as a lawyer, and he gave legal advice and acted as a lawyer. The Court has long held that an attorney violates Rule 8.4(a)(4) by any conduct, statement or omission that is calculated to deceive including "the suppression of truth or the suggestion of what is false." See, e.g., In re Yamaguchi, 118 Ill.2d 417, 426, 515 N.E.2d 1235 (1987). Even if Respondent never stated outright that he was a practicing lawyer, he knowingly created that impression through his actions and suggestions. Respondent also argues that the Hearing Board erred in
finding he engaged in dishonesty by settling the dispute with Seneca without DeBarbieri's knowledge. He claimed DeBarbieri knew he settled the matter although he could point to no evidence that would suggest that Respondent disclosed the settlement to DeBarbieri. The Hearing Board believed DeBarbieri and did not believe Respondent. We uphold this finding. Respondent's actions in evading DeBarbieri in 2011 and his subsequent statements support the Hearing Board's findings.
Finally, in response to the findings that Respondent took the settlement funds without the knowledge or authority of DeBarbieri or Sace, Respondent contends that he was "holding" the settlement funds for DeBarbieri because he had a fee dispute with him. This statement is false. The records demonstrate Respondent did not "hold" the funds; he stole them. As soon as he received the settlement payments, he spent the funds on personal expenses.
The Hearing Board recommended that Respondent be disbarred. Respondent suggests that a period of suspension is appropriate, although he provides no precedent for such a recommendation or any evidence in mitigation that would suggest the appropriateness of such a recommendation. He also states that he has no intention to practice law. The Administrator argues that this is a "public protection case"; we agree.
Respondent's actions in disobeying the Court's order suspending him from the practice of law warrant a severe sanction. The Court has disbarred lawyers for practicing during their suspensions. See e.g., In re Sorkin, 95 CH 752 (Review Bd., Sept. 12, 1997), approved and confirmed, No. M.R. 14191 (Jan. 29, 1998); In re Neuendorf, 02 CH 31 (Review Bd., March 19, 2004), recommendation adopted, No. M.R. 19941 (Sept. 24, 2004). In addition, the Court has
disbarred lawyers for engaging in intentional conversions. See, e.g., In re Rotman, 136 Ill. 2d 401, 556 N.E.2d 243 (1990).
The following cases also provide support for a disbarment recommendation. In In re Wojcik, 94 CH 25 (Review Bd., May 12, 1995), petition for leave to file exceptions denied, No. M.R. 11518 (Sept. 29, 1995), the Court disbarred the respondent for practicing during his suspension after he failed to register and for settling a case without his client's consent and misappropriating the settlement. In In re Garvin, 97 CH 38 (Review Bd., March 27, 2000), petition for leave to file exceptions denied, No. M.R. 16785 (Sept. 27, 2000), the respondent settled a case and misappropriated a settlement during his suspension. He was also disbarred.
Respondent's misconduct is aggravated by several factors. The Hearing Board found that Respondent's actions caused harm to DeBarbieri, by causing the loss of Sace as a client. Also in aggravation, the Hearing Board concluded that Respondent engaged in similar dishonest conduct by holding himself out as a lawyer on his LinkedIn profile. He has not paid any restitution of the funds he took. Astonishingly, he claimed at oral argument before this Board that he believes he is still entitled to a fee for his work for DeBarbieri as an explanation for his refusal to pay restitution.
Respondent blames others for his misdeeds, from DeBarbieri to his ex-wife who looked for financial support while Respondent was suspended. But Respondent has failed to acknowledge that his actions in disobeying the Supreme Court's order, in deceiving others into believing he was authorized to practice law, and in taking settlement funds that did not belong to him, caused harm. We agree with the Hearing Board that Respondent's conduct warrants disbarment.
We affirm the findings of fact and the findings of misconduct of the Hearing Board, with the exception of the charge of conversion. We recommend to the Court that Respondent, David Michael Levin, be disbarred.
Johnny A. Fairman, II
I, Kenneth G. Jablonski, Clerk of the Attorney Registration and Disciplinary Commission of the Supreme Court of Illinois and keeper of the records, hereby certifies that the foregoing is a true copy of the Report and Recommendation of the Review Board, approved by each Panel member, entered in the above entitled cause of record filed in my office on April 18, 2014.
Kenneth G. Jablonski, Clerk of the
1 At the Review Board, the Administrator agreed the stand alone conversion charge should be dismissed in light of the Court's decision in In re Karavidas, 2013 IL 115767 par. 79. We consider the conduct as the Hearing Board's finding that Respondent violated 8.4(c) rested on the same facts and we look to Respondent's conduct as a whole in determining a sanction.
2 Panel Member Anna M. Loftus participated in the deliberation and decision in this case prior to the expiration of her term as a member of the Review Board pursuant to the Court's order of March 12, 2014 appointing her as a Circuit Court Judge in Cook County.