THERE IS NO DUTY FOR AN ATTORNEY TO REPORT A CRIME. BUT THERE IS A DUTY FOR ATTORNEYS TO REPORT ETHICS OFFENSES – WILL CHESLEY ACCUSERS BE PROTECTED FROM DISCOVERY OF POSSIBLE CONFLICT OF INTEREST RULES

This article discusses the efforts of attorney Stan Chesley to obtain discovery of information which may provide a defense in his disbarment proceedings.

Justice Leibson in a dissent concluded that under Kentucky law there is no duty for an attorney to report a criminal offense by another. See dissent by Justice Leibson: “…it is not unlawful to refuse to inform on a criminal offense…” Penn v. Com., 687 S.W.2d 135 (Ky., 1985)

The Penn case discussed duties of a citizen and not an attorney. However we have found no rule or statute that requires an attorney who learns of a criminal act to report the crime to the authorities.

But in cases where a Supreme Court ethics rule is violated, any attorney knowing of an ethics violation does have a duty to report it.

In 2009 the Kentucky Supreme Court adopted the so-called “Squeal Rule” which requires an attorney to report an ethical violation to the Bar Counsel’s office.

See: SQUEAL RULE – KENTUCKY ATTORNE’YS DUTY TO REPORT ETHICS VIOLATIONS

 

SCR 3.130(8.3) Reporting professional misconduct

 

(a) A lawyer who knows that another lawyer has committed a violation of the Rules of Professional Conduct that raises a substantial question as to the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects, shall inform the Association’s Bar Counsel.

(b) A lawyer who knows that a judge has committed a violation of applicable rules of judicial conduct that raises a substantial question as to the judge’s fitness for office shall report such violation to the Judicial Conduct Commission.

(c) A lawyer is not required to report information that is protected by Rule 1.6 or by other law. Further, a lawyer or a judge does not have a duty to report or disclose information that is received in the course of participating in the Kentucky Lawyer Assistance Program or Ethics Hotline.

(d) A lawyer acting in good faith in the discharge of the lawyer’s professional responsibilities required by paragraphs (a) and (b) or when making a voluntary report of other misconduct shall be immune from any action, civil or criminal, and any disciplinary proceeding before the Bar as a result of said report, except for conduct prohibited by Rule 3.4(f).

(e) As provided in SCR 3.435, a lawyer who is disciplined as a result of a lawyer disciplinary action brought before any authority other than the Association shall report that fact to Bar Counsel.

(f) As provided in SCR 3.166(2), a lawyer prosecuting a case against any member of the Association to a plea of guilty, conviction by judge or jury or entry of judgment, should immediately notify the Director of such event.

HISTORY: Amended by Order 2009-05, eff. 7-15-09; adopted by Order 89-1, eff. 1-1-90

 

The Supreme Court commentary on SCR 3.130 (8.3) states:

“SUPREME COURT COMMENTARY 2009:

(1) Self-regulation of the legal profession requires that members of the profession initiate a

disciplinary investigation when they know that another lawyer has violated certain minimum

standards of behavior as described in the Rule. Lawyers have a similar obligation with respect to

judicial misconduct. An apparently isolated violation may indicate a pattern of misconduct that

only a disciplinary investigation can uncover. Reporting a violation is especially important

where the victim is unlikely to discover the offense.

(Author’s comment: Chesley is not believed to have known of a potential conflict by the Bar Counsel until the KBA announced the firing of Linda Gosnell on Nov. 21, 2012).

(2) If a lawyer were obliged to report every violation of the Rules, the failure to report any

violation would itself be a professional offense. Such a requirement exists in many jurisdictions

but has proved unenforceable. The Rule limits the reporting obligation to those violations that a

self-regulating profession must vigorously endeavor to prevent. A measure of judgment is,

therefore, required in complying with the provisions of this Rule. The term “substantial” refers

to the seriousness of the possible offense and not the quantum of evidence of which the

lawyer is aware.

(Author’s comment: This would appear to lower the standard of proof required of Chesley to obtain the discovery he seeks.)

A report should be made to the bar disciplinary agency unless some other agency, such

as a peer review agency is more appropriate in the circumstances. Similar considerations apply

to the reporting of judicial conduct. Lawyers requiring assistance in determining the need to

report a violation may confer with their Supreme Court District Committee member. Pursuant to

SCR 3.530(7) a lawyer’s communications with a District Committee member are confidential.

(3) A lawyer who knows that a judge has committed a violation of the Code of Judicial Conduct

that raises a substantial question as to the judge’s fitness shall, at a minimum, file a report with

the Judicial Conduct Commission. The term “substantial” refers to the seriousness of the possible

offense.

(4) The duty to report professional misconduct does not apply to a lawyer retained to represent a

lawyer whose professional conduct is in question. Such a situation is governed by the rules

applicable to the client-lawyer relationship.

(5) The duty to report misconduct is an important aspect of self-regulation, and is intended to

achieve societal goals. In order to protect a lawyer who makes a report in compliance with the

Rule and to encourage a lawyer to make a voluntary report of other acts of misconduct, the Rule

provides qualified immunity to the reporting lawyer thereby removing the fear of retaliation by

the reported lawyer or judge. The Rule’s immunity provision is founded upon a similar rule of

immunity provided by SCR 4.300, Canon 3D(3) of the Kentucky Code of Judicial Conduct.”

(Emphasis added by LawReader.)

The squeal rule does not require that the attorney file a complaint, only that he “report” his information to the Bar Counsel.

The next question that presents itself is: what happens when the Bar Counsel is the person who is alleged to have violated an ethical duty?

Cincinnati attorney Stanley Chesley has asked the U.S. District Court, the Boone County Circuit Court, and the Kentucky Supreme Court to allow him discovery of the Angela Ford distribution of Fen Phen funds she has seized pursuant to a summary judgment in Abbott v. Chesley et al.

U.S. District Court Judge Danny Reeves has issued an order denying Chesley the right to obtain discovery from Angela Ford regarding the names of lawyers to whom she made a distribution from her legal fees. Ford is quoted by Judge Reeves as having admitted she made a distribution of funds to “other lawyers”. Judge Reeves described Chesley’s argument as “speculative”.

Chesley has filed motions with Judge Reeves asking him to flesh out his ruling so that Chesley may have a clear understanding of the parameters of Judge Reeve’s ruling in anticipation of Chesley’s potential appeal of Judge Reeve’s denial of discovery.

The motions for discovery by Chesley pending before the Boone Circuit Court and the Kentucky Supreme Court are still pending.

Chesley’s motions for discovery include a dozen tendered Interrogatories. One of the tendered questions concerns whether or not the Bar Counsel’s husband was one of the attorneys to whom Angela Ford shared her legal fees. (Chesley claims that Leslie Rosenbaum is the husband of Bar Counsel Linda Gosnell. She was fired on Nov. 21, 2012 but was the chief prosecutor of Chesley in the KBA action seeking disbarment of Chesley.)

Chesley’s discovery requests are based on the possibility that his prosecutor’s husband received funds from Angela Ford and if this occurred, there apparently was a duty for the Bar Counsel to recuse herself from the ethics prosecution.

If in fact it is ultimately revealed that Gosnell’s husband had a financial interest in the distribution of Fen Phen funds, then case law, criminal law, and ethics rules would appear to have imposed a duty on Linda Gosnell to have recused herself from the prosecution of Chesley.

The failure of a prosecutor to recuse themselves where there is a conflict of interest, appears to not only violate the SCR’s but also appears to violate several criminal statutes.

We would suggest that any lawyer on the Board of Governors, any officer of the KBA, any attorney who is a party to this debate, and any member of the Bar Counsel’s office who may have information concerning a potential ethics violation by the former Bar Counsel, have a duty under the Squeal Rule to report it to the Bar Counsel’s office. Will the Squeal Rule be enforced against these officials of the KBA ….or do they have special unwritten rules exempting them from this duty? At the present, no member of the Bar Counsel’s office has been dismissed other than Linda Gosnell. The Supreme Court Rules do not provide for a situation where the ethics violations are committed by the Bar Counsel’s office. Who will investigate the investigators?

This situation raises a question about the current attorney discipline process. Perhaps it is time to refer all ethics hearings to the local Circuit Court. Real judicial proceedings have many safeguards including transparency, that do not exist in the current attorney discipline mechanism.

THE DUTY OF THE BAR COUNSEL TO RECUSE HERSELF

See: Thorpe v. Com., 295 S.W.3d 458 (Ky. App., 2009)

“KRS 15.733(2)(c) & (d) provide in pertinent part as follows:

[a] prosecuting attorney shall disqualify [her]self in any proceeding in which … a member of [her] immediate family … [i]s known by the prosecuting attorney to have an interest that could be substantially affected by the outcome of the proceeding; [or] [i]s to the prosecuting attorney’s knowledge likely to be a material witness in the proceeding[.] (emphasis added).”

“Since immediate family is not defined by the statute, we are to construe it according to its common, everyday meaning. Wilfong v. Commonwealth, 175 S.W.3d 84, 96 (Ky.App.2004).

Black’s Law Dictionary defines it as “a person’s parents, spouse, children, and siblings.” at 620 (7th ed. 1999).”

“KRS 15.733 Disqualification of prosecuting attorney — Appointment of a special prosecutor.

(1) For the purposes of this section the following words or phrases shall have the meaning indicated:

(a) “Proceeding” includes pretrial, trial, appellate review, or other stages of litigation;

(b) “Fiduciary” includes such relationships as executor, administrator, conservator, trustee, and guardian;

(c) “Financial interest” means ownership of a legal or equitable interest, however small, or a relationship as director, adviser, or other active participant in the affairs of a party, except that:

(2) Any prosecuting attorney shall disqualify himself in any proceeding in which he or his spouse, or a member of his immediate family either individually or as a fiduciary:

(a) Is a party to the proceeding, or an officer, director, or trustee of a party;

(b) Is acting as a lawyer in the proceeding;

(c) Is known by the prosecuting attorney to have an interest that could be substantially affected by the outcome of the proceeding;

(d) Is to the prosecuting attorney’s knowledge likely to be a material witness in the proceeding;

(e) Has served in private practice or government service, other than as a prosecuting attorney, as a lawyer or rendered a legal opinion in the matter in controversy;

(f) Has a financial interest in the subject matter in controversy or in a party to the proceeding, or any other interest that could be substantially affected by the outcome of the proceeding.

(3) Any prosecuting attorney may be disqualified by the court in which the proceeding is presently pending, upon a showing of actual prejudice.

(4) In the event that a prosecuting attorney is disqualified, he shall certify such fact in writing to the Attorney General who may direct another Commonwealth’s attorney or county attorney or an assistant attorney general as a special prosecutor to represent the Commonwealth in that proceeding. Effective: July 1, 1982”

If a prosecutor was in violation of KRS 15.733, then it is possible that the criminal code might apply to a failure of the prosecutor to recuse herself.

See the following offenses:

KRS 522.020 Official Misconduct In The First Degree.

(1) A public servant is guilty of official misconduct in the first degree when, with intent to obtain or confer a benefit or to injure another person or to deprive another person of a benefit, he knowingly:

(a) Commits an act relating to his office which constitutes an unauthorized exercise of his official functions; or

(b) Refrains from performing a duty imposed upon him by law or clearly inherent in the nature of his office; or

(c) Violates any statute or lawfully adopted rule or regulation relating to his office.

(2) Official misconduct in the first degree is a Class A misdemeanor.

Effective: January 1, 1975

History: Created 1974 Ky. Acts ch. 406, sec. 187, effective January 1, 1975

KRS 522.030 Official Misconduct In The Second Degree.

(1) A public servant is guilty of official misconduct in the second degree when he knowingly:

(a) Commits an act relating to his office which constitutes an unauthorized exercise of his official functions; or

(b) Refrains from performing a duty imposed upon him by law or clearly inherent in the nature of his office; or

(c) Violates any statute or lawfully adopted rule or regulation relating to his office.

(2) Official misconduct in the second degree is a Class B misdemeanor.

Effective: January 1, 1975

History: Created 1974 Ky. Acts ch. 406, sec. 188, effective January 1, 1975

Let us return to the Squeal Rule. The duty of an attorney to report a potential ethical violation does not require proof beyond a reasonable doubt. SCR 3.130 (8.3) imposes a duty to report a possible violation of the SCR’s if the information merely “raises a substantial question”….

Chesley’s motions point out that Gosnell’s husband reported on his firm’s website in 2007, that he was experienced in “Fen Phen” and “Major Drug Tort Litigation”. The acts alleged in the ethics prosecution of Chesley occurred prior to 2007. So Chesley’s argument is based on the facts that:

1. A Federal Judge has made a finding that Angela Ford made fee disbursements to “other attorneys”. Ford admits that in an interview with the Courier-Journal.

2. Gosnell’s husband advertised his experience in “Fen Phen” and “Drug Tort Litigation”. Therefore Chesley would ask, “where Gosnell’s husband got his experience in Fen Phen litigation if not through Angela Ford?”

SCR 3.130(8.3) Reporting Professional Misconduct – (a) A lawyer who knows that another lawyer has committed a violation of the Rules of Professional Conduct that raises a substantial question as to the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects…”,

 

The Thorpe case clearly cites the law imposing a duty on all prosecutors to recuse themselves if they or their spouse receives a benefit from a pending case the prosecutor is handling.

 

A prosecutor has a clear duty to recuse themselves from a case when “KRS 15.733 Disqualification Of Prosecuting Attorney —“ is violated.

 

We cite: KRS 522.020 Official Misconduct In The First Degree – and KRS 522.030 Official Misconduct In The Second Degree , as two potential criminal statutes which impose penalties upon a prosecutor who “Refrains from performing a duty imposed upon him by law or clearly inherent in the nature of his office;”

If Gosnell’s husband did in fact receive financial benefits from Chesley’s chief accuser, how can Chesley discover if in fact there was a conflict of interest and a violation by the Bar Counsel in failing to disclose the conflict and in failing to recuse herself?

Will the courts ignore the right of Chesley to defend himself?

The Federal Court Judge has already denied Chesley discovery on this question. The Boone Circuit Court and the Kentucky Supreme Court have pending motions before them and their response is of course yet to be made.

We would ask generally, what happens if the Boone Circuit Court and the Kentucky Supreme Court deny Chesley’s discovery motion? As this article is written Gosnell’s deputy Bar Counsel is the acting Bar Counsel.

If the acting Bar Counsel, and the Board of Governor’s know of an actual conflict violation by Gosnell, what action will they take to disclose these facts? Gosnell was fired 69 days ago and the KBA has not disclosed why they fired Linda Gosnell. If the Board of Governors and/or the Deputy Bar Counsel have knowledge of an ethical violation by Gosnell will they ever disclose this information? Will they stand by and allow a defendant attorney to be denied a legitimate defense?

We acknowledge the byzantine structure of the Supreme Court Rules regarding prosecution of attorneys for ethics violations. Almost everything they investigate is hidden behind a curtain of secrecy. Will the KBA and the Courts uphold a system where the confidentiality rules (which were adopted to protect the attorney being prosecuted) can be used to deny inquiry into potential illegal conduct by the Bar Counsel?

There is a fourth avenue which Chesley might pursue to seek discovery of potential criminal acts. The Franklin County Commonwealth’s Attorney is charged with the duty to investigate all potential crimes in his jurisdiction.

If the Board of Governors and the Deputy Bar Counsel, Linda Gosnell and her husband, and Angela Ford are subpoenaed before a Franklin County grand jury and asked under oath about the possibility that Ford paid Rosenbaum, and Gosnell failed to recuse herself, would they answer the questions, or would they try to hide behind the SCR confidentiality rules?

We find it difficult to consider that the Grand Jury would not have the jurisdiction to investigate the issues raised by Chesley. Further a reading of SCR 3.150 provides several avenues under which the information possessed by the Bar Counsel and the KBA can be argued to not be subject to the confidential rules.

We find the language in SCR 3.150 (4) (b) to be depositive of the question regarding the Commonwealth attorneys right to investigate potential criminal offenses by the Bar Counsel:

“A request for non-public information to the Office of Bar Counsel may be considered by the Court if the request is made by a Law Enforcement Agency, or other official authorized by federal or any state’s law to investigate or prosecute misdemeanors or felonies.”

By asking for this information, Chesley has waived any confidentiality protection. We find nothing in the SCR which says that the confidentiality rule is for the protection of the Bar Counsel’s office or the KBA Board of Governors.

See the Confidentiality Rule:

 

SCR 3.150 Access to disciplinary information

(1) Confidentiality. In a discipline matter, prior to a rendition of a finding of a violation of these Rules by the Trial Commissioner or the Board and the recommendation of the imposition of a public sanction, the proceeding is confidential.

(2)

(a) Notwithstanding subsection (1), the pendency, subject matter and status may be disclosed by Bar Counsel if:

i. The Respondent has waived confidentiality;

ii. The proceeding involves public reciprocal discipline;

iii. The disclosure of any information is made for the purpose of conducting an investigation by the Inquiry Commission or the Office of Bar Counsel, or;

iv. A Motion for Temporary Suspension is pending.

(b) After considering the protection of the public, the interests of the Bar, and the interest of the Respondent in maintaining the confidentiality of the proceeding prior to a finding of a violation of the Rules, the pendency, subject matter and status may also be disclosed by Bar Counsel at the discretion of the Chair of the Inquiry Commission, or of the Chair’s lawyer member designee, if:

i. The proceeding is based upon an allegation that the Respondent has been charged with a crime arising from the same nexus of facts; or

ii. The proceeding is based upon a finding by a court in a civil matter that an attorney has committed conduct that may constitute a violation of the Rules of Professional Conduct.

(3) Duty of Participants. All Participants in a proceeding under these Rules shall conduct themselves so as to maintain the confidentiality requirement of this Rule. Nothing in the rule shall prohibit the Respondent from discussing the disciplinary matter with any potential witness or entity in order to respond in a disciplinary proceeding, or to disclose to any tribunal, or to disclose any information for the purpose of conducting a defense. This provision shall not apply to the Complainant or the Respondent after the Inquiry Commission or its Chair has taken action on a Complaint including the issuance of a charge, the issuance of a private admonition, or a dismissal, including those pursuant to SCR 3.160(3).

(4)

(a) Request for Non-Public Information. A request for non-public information to the Office of Bar Counsel may be considered by the Inquiry Commission and may be granted if the request relates to an investigation by the requestor and is made by:

i. The Character and Fitness Committee;

ii. A Lawyer Disciplinary Enforcement Agency;

iii. A Judicial Disciplinary Enforcement Agency;

(b) A request for non-public information to the Office of Bar Counsel may be considered by the Court if the request is made by a Law Enforcement Agency, or other official authorized by federal or any state’s law to investigate or prosecute misdemeanors or felonies, or the equivalent thereof, in any jurisdiction, provided that the agency or official certifies under oath with specificity that the information is necessary to a pending investigation. In this event the Respondent shall receive notice unless the Court determines that disclosure of the request would seriously prejudice the investigation.

(c) In the absence of a third party request, the Court may permit the disclosure of any nonpublic information to any of the entities listed in (4)(a) or (b) upon application to it by the Office of Bar Counsel.

(d) In the event of a request under (4)(a) or (c) no notice to the Respondent is required, although either the Inquiry Commission or Court may require notice upon review of the application.

(5) Public Proceedings. Upon a finding by the Trial Commissioner or the Board that an attorney has committed a violation of these rules meriting public discipline, or upon the filing of a petition for reinstatement, the record of the Disciplinary Clerk, and any further proceedings before the Board or Court, shall be public except for:

(a) deliberations of the Inquiry Commission, Board of Governors, or the Court; or

(b) information with respect to which a protective order has been issued.

(6) Protective Orders. The Inquiry Commission, the Trial Commissioner, the Board, or the Court, which at the time the order is sought has the case pending before it, may, upon application of any person or entity, and for good cause shown, issue a protective order. Such an order may protect the interests of a Complainant, witness, third party, Respondent, or Bar Counsel. The order may prohibit the disclosure of specific information otherwise privileged or confidential and direct that the proceedings be conducted so as to implement the order, including requiring that the hearing be conducted in such a way as to preserve the confidentiality of the information that is the subject of the application.

(7) Notice to National Discipline Data Bank. The Disciplinary Clerk shall transmit notice of all public discipline imposed against a lawyer and reinstatements to the National Discipline Data Bank maintained by the American Bar Association.

HISTORY: Amended by Order 2007-007, eff. 2-1-08; prior amendments eff. 1-1-99 (Order 98-2),

10-1-98 (Order 98-1), 1-1-87 (Order 86-3), 1-1-86, 10-1-82, 4-1-82, 1-1-80, 7-2-71

¹SCR 3.150(8) is amended to comply with Doe v. Supreme Court of Florida, 734 F.Supp. 981

(S.D. Fla. 1990).

 

We would conclude that the Confidentiality rule does not apply to provide a right by the KBA or the Bar Counsel’s office to refuse to answer questions submitted by the Commonwealth Attorney in his investigation of potential violations of:

 

KRS 15.733 Disqualification Of Prosecuting Attorney

KRS 522.020 Official Misconduct In The First Degree – or

KRS 522.030 Official Misconduct In The Second Degree

CONCLUSION

 

The claim raised by Chesley that a KBA official may have failed in their duty to recuse themselves, is not unique to the Chesley case. In the ethics prosecution of Eric Deters, the Trial Commissioner, Frank Doheny, Jr. disclosed that his law partner at Dinsmore and Shohl had a financial interest due to her representation of the client who filed a complaint against attorney Eric Deters. While Doheny disclosed this issue during the hearing, he refused to recuse himself. No relief was granted to Deters on this issue. The Chief Justice refused to hear Deter’s motion for recusal of Doheny.

 

We would suggest that Chesley has raised a legitimate question concerning a potential conflict of interest which may have denied him due process of law. Will the courts and law enforcement agencies standby and place the protection of the Bar Counsel’s office above the rights of an attorney whom the KBA is seeking to disbar?

 

If Chesley’s motion for discovery finds that Gosnell’s husband did not work for or with Angela Ford, and that he did not receive any payment from Ford, then Chesley’s issues will be quickly disposed of, and Gosnell and her husband will be quickly cleared.

 

However, if the courts deny Chesley the right to discovery, and if in the future it is revealed that there was an ethical problem, then in the words of Rev. Al Sharpton, “they will have Blueberry pie all over their faces.”

 

Note: LawReader will publish in a separate article a number of pleadings filed by Chesley with the Kentucky Supreme Court on Jan. 25, 2012 seeking discovery.

 

 

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