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    Wisconsin Lawyer
    December 01, 2012

    Lawyer Discipline

    The Office of Lawyer Regulation (OLR), an agency of the Wisconsin Supreme Court and component of the lawyer regulation system, assists the court in carrying out its constitutional responsibility to supervise the practice of law and protect the public from misconduct by lawyers. The OLR has offices at 110 E. Main St., Suite 315, Madison, WI 53703; toll-free (877) 315-6941. The full text of items summarized in this column can be viewed at

    Disciplinary proceeding against Tommy D. Payne

    On Oct. 9, 2012, the Wisconsin Supreme Court suspended the Wisconsin law license of Tommy D. Payne, who is known to have practiced law in Chicago, for six months, as discipline reciprocal to a six-month suspension imposed against Payne’s Illinois law license by the Illinois Supreme Court in September 2011. Disciplinary Proceedings Against Payne, 2012 WI 109.

    The Illinois suspension arose out of Payne’s violation of the Illinois Rules of Professional Conduct (IRPC) and involved his representation of an estate. Specifically, Payne was found to have committed professional misconduct consisting of failing to act with reasonable diligence and promptness in representing a client, in violation of IRPC 1.3; failing to keep a client reasonably informed about the status of a matter and to promptly comply with reasonable requests for information, in violation of IRPC 1.4(a)(3) and (4); engaging in conduct that tends to defeat the administration of justice or that brings the courts or the legal profession into disrepute, in violation of Illinois Supreme Court Rule 770; failing to refund the unearned portion of a fee paid in advance, in violation of IRPC 1.16(d); and knowingly failing to respond to a lawful demand for information from a disciplinary authority, in violation of IRPC 8.1(d).

    Payne’s Wisconsin law license was suspended in 1993 because of his failure to pay bar dues and assessments and in 1995 because of his failure to comply with mandatory continuing legal education reporting requirements. His license remains administratively suspended.

    Disciplinary proceeding against James J. Gende II

    On Sept. 25, 2012, the supreme court publicly reprimanded James J. Gende II, Pewaukee. The court also ordered Gende to pay $20,221.76 in restitution to his former employer, Cannon & Dunphy S.C., and required him to pay the full cost of the disciplinary proceeding, $28,478.76. Disciplinary Proceedings Against Gende, 2012 WI 107.

    Gende was admitted to practice in 2000. The disciplinary proceeding arose from Gende’s departure from Cannon & Dunphy in 2004. Between 2000 and 2004, Gende represented more than 90 of the firm’s clients in personal injury matters and signed retainer contracts on behalf of the firm with all but two of those clients. The retainer contracts gave the firm a lien against a client’s recovery if the client changed attorneys before a case was resolved. The two retainer contracts that Gende did not sign involved Illinois cases.

    After Gende decided to leave the firm and start his own practice, he and the firm negotiated a separation agreement that provided, with one exception, that 80 percent of any fees generated by a departing client would be paid to the firm and 20 percent to Gende. The exception related to one of the two Illinois cases; the agreement stated that Gende was to receive 25 percent of the fees in that matter. Six of the 16 cases that Gende continued to handle were settled within 10 weeks of his departure. Disputes relating to fees and costs arose almost immediately and were litigated over several years, with Gende pursuing appeals as high as the U.S. Supreme Court. No court found that Gende was entitled to the disputed fees but neither did any court find that Gende’s positions were frivolous.

    While the litigation was pending, Gende “held or tried to hold” in trust his former firm’s disputed 80 percent share of the fees identified in the separation agreement ($235,283.65), while immediately paying himself 20 percent of the fees, pursuant to that same agreement. However, with respect to the two Illinois cases, Gende failed to hold any portion of the disputed fees in trust and paid himself the full fees in both.

    Gende failed to provide his former firm with a full accounting in one of the Illinois cases, in violation of former SCR 20:1.15(b) and (d)(2); and failed to hold in trust $12,440.77 in disputed fees in that case and failed to hold $7,780.99 in trust in the second Illinois case, in violation of former SCR 20:1.15(d)(3). In addition, Gende failed to hold $213,667.86 in disputed fees in trust for several weeks by failing to deposit a cashier’s check from the Waukesha County clerk of court into a trust account, thereby violating former SCR 20:1.15(d)(3). Gende had no prior discipline.

    Disciplinary proceedings against Louis A. Stockman

    The supreme court suspended the Wisconsin law license of Louis A. Stockman, Duluth, Minn., for five months effective Oct. 10, 2012, as discipline reciprocal to a five-month suspension the Minnesota Supreme Court imposed on Stockman’s Minnesota law license. Disciplinary Proceedings Against Stockman, 2012 WI 110.

    The Minnesota suspension arose out of Stockman’s misconduct in violation of the Minnesota Rules of Professional Conduct (MRPC) as follows: 1) MRPC 1.15(a), (b), (c)(5), and (h), 5.4(a), and 7.2(b) – negligently misappropriating client funds, mishandling client funds, commingling personal funds with client funds, failing to maintain required trust account books and records, and sharing legal fees with a nonlawyer assistant; 2) MRPC 1.8(a) and (e) – lending money to clients; 3) MPRC 1.3 and 1.15(c) – failing to diligently resolve a client matter and failing to return a contingent fee to a client trust account; 4) MRPC 1.2(a), 1.4(a)(1), 1.5(b) and (c), 1.7(a)(2), and 1.8(e) – failing to clearly communicate the basis and rate of fees, failing to provide the client with a settlement statement, and remitting personal funds to a client; and 5) MRPC 1.1, 1.3, 1.4(b), 1.15(c)(4), 3.2, and 3.4(a) – engaging in a pattern of client-related misconduct.

    Stockman had no prior Wisconsin discipline.

    Disciplinary proceedings against James Cyril Kotz

    On Sept. 25, 2012, the supreme court revoked the Wisconsin law license of James Cyril Kotz, Burbank, Ill., as discipline reciprocal to a Sept. 20, 2011, Supreme Court of Illinois order and mandate striking Kotz’s name from the roll of Illinois attorneys, effectively disbarring him. Disciplinary Proceedings Against Kotz, 2012 WI 108.

    The Illinois suspension order arose out of Kotz’s misconduct in violation of IRPC 8.4(a)(3), (4), and (5) and Illinois Supreme Court Rule 770. In a federal criminal case, Kotz had pleaded guilty to violating 26 U.S.C. § 7212(a) by creating a fictitious scheme to conceal the receipt of taxable income generated by the sale of real estate and creating a fictitious corporation to further this scheme. The Illinois violations stemmed from this conduct and Kotz’s subsequent conviction.

    Kotz had no prior Wisconsin discipline.

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