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ATTORNEY disciplinary
proceeding. Attorney's license
suspended.
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1. PER CURIAM. We review the stipulation
filed by Attorney
Bruce J. Meagher and the Office of Lawyer
Regulation (OLR) pursuant to SCR 22.12,
which sets forth findings of fact and
conclusions of law regarding Attorney
Meagher's professional misconduct. The
parties stipulated to a six-month suspension
of Attorney Meagher's license to practice
law in Wisconsin, to be imposed retroactive
to the date of his temporary suspension,
November 12, 2002.
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2. We accept the parties' stipulation and
recommendation that a suspension of six
months, imposed retroactively, is
appropriate discipline for Attorney
Meagher's misconduct.
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3. Attorney Meagher was admitted to
practice in
1980. On November 12, 2002, Attorney
Meagher's license to practice law in
Wisconsin was temporarily suspended,
pursuant to SCR 22.20(1), in connection with
his conviction for violation of a federal
wire wagering law. That conviction forms the
basis for one of the counts of misconduct
described herein. Attorney Meagher has no
other disciplinary history.
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4. On May 2, 2003, the OLR filed a
complaint
against Attorney Meagher, which alleged two
counts of misconduct. The complaint alleged
that Attorney Meagher represented a client
when the representation of that client was
directly adverse to another client without
reasonably believing the representation
would not adversely affect the relationship
with the other client and without obtaining
each client's written consent in violation
of SCR 20:1.7(a). The complaint further
alleged that Attorney Meagher engaged in
criminal conduct that reflects adversely on
the lawyer's honesty, trustworthiness or
fitness as a lawyer in other respects in
violation of SCR 20:8.4(b).
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5. On or about May 20, 2003, the OLR and
Attorney Meagher filed a stipulation
pursuant to SCR 22.12, in which Attorney
Meagher stipulated to the misconduct charged
in the OLR's complaint and to the sanctions
sought by the OLR.
6. The facts giving rise to the
violation of
SCR 20:1.7(a), relating to Attorney
Meagher's representation of a client despite
the existence of a conflict of interest are
set forth in the stipulation, and described
herein.
7. Kenneth Flannery (Flannery) is a
Minnesota businessman who sold benefit and
payroll services. Flannery had an ongoing
attorney-client relationship with Attorney
Meagher. Steve Haskins (Haskins) is a
Minnesota businessman who was a consultant
for and provider of employee benefits
programs.
8. In January 1998 Flannery and Haskins
asked
Attorney Meagher to represent them in a
joint business venture to develop an
employee benefits software program. Attorney
Meagher was hired to set up one or more
limited liability corporations (LLCs),
intended to merge the businesses of Flannery
and Haskins. Attorney Meagher filed
Minnesota Articles of Organization to create
two new LLCs for Flannery and Haskins, for
operation of the joint business venture.
9. On January 28, 1998, Attorney Meagher
sent
Flannery and Haskins, for discussion
purposes, drafts of two operating agreements
for the new LLCs. These operating agreements
contemplated that Flannery and his existing
companies would own a 60 percent interest in
each, and Haskins and his existing company
would own a 40 percent interest. Neither
operating agreement was ever executed.
10. Haskins' company wrote a check to
Attorney
Meagher in partial payment of Attorney
Meagher's legal services. Haskins' company
made other payments on behalf of the new
companies and the development of the
software program, totaling over $200,000.
Haskins represents that those payments
constituted his capital contribution to the
new companies. Attorney Meagher asserts that
he did not know of these investments at the
time they were made.
11. The process for the new LLCs was never
entirely concluded, in that the operating
agreements were never signed. Flannery and
Haskins continued to negotiate the terms of
the joint business venture.
12. During the spring, summer, and early
fall
of 1999, according to a subsequent
arbitrator's decision, Flannery
allegedly "waged a campaign to discredit"
Haskins, steal away his existing clients,
and to set up a competing business. Flannery
also allegedly contacted two of Haskins'
employees regarding creation of the new
competing business (EBIG).
13. Attorney Meagher was hired to
incorporate
EBIG. Although EBIG was intended to compete
with Haskins' business, Attorney Meagher did
not obtain consent from Haskins for this
representation.
14. As of October 1, 1999, the two
employees
left Haskins' firm and started doing
business as EBIG. They contacted Haskins'
clients and encouraged them to switch to
their new company. Flannery entered into
separate negotiations with Haskins to
purchase Haskins' existing company. Haskins
retained new counsel. Attorney Meagher
undertook representation of Flannery in the
negotiations without seeking or obtaining
written consent from Haskins or Flannery
regarding any conflict of interest.
15. After intense negotiations in which
Attorney Meagher was involved, Haskins and
Flannery signed a sale agreement. The sale
price that Flannery was to pay Haskins was
based on a percentage of the profits of the
company over the next ten years.
16. Haskins' counsel drafted documents,
including a letter of intent, to effectuate
the sale and presented them for Attorney
Meagher's review. Attorney Meagher responded
that he and Flannery were "flabbergasted" to
discover how much the proposed closing
documents deviated from the letter of
intent. Attorney Meagher threatened to file
a lawsuit seeking specific performance.
17. One of the provisions in the
documents to
which Attorney Meagher objected involved the
new competing company, which Attorney
Meagher had formed for Flannery and for
Haskins' former employees. In the midst of
negotiations, Haskins wrote to Flannery
requesting corporate information regarding
the joint business venture in which he had
invested some $200,000. Flannery denied that
Haskins had any ownership interest in the
joint business venture. Attorney Meagher
also asserted in subsequent correspondence
that Haskins' requests for information about
the joint venture, regarding which Attorney
Meagher had previously provided legal
representation, were "frivolous."
18. The sale from Haskins to Flannery
was
never consummated. Flannery sought to
enforce the sale agreement through
arbitration proceedings. Attorney Meagher
did not represent Flannery in those
proceedings, but did appear as a witness.
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19. The OLR complaint alleged that by
representing Flannery when the
representation of Flannery was directly
adverse to Haskins, and when the
representation adversely affected the
relationship with Haskins, and by not
obtaining written conflict waivers from
Flannery or Haskins, Attorney Meagher
represented a client when the representation
of that client will be directly adverse to
another client without reasonably believing
the representation will not adversely affect
the relationship with the other client and
without each client's written consent, in
violation of SCR 20:1.7(a).
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20. The stipulation executed by Attorney
Meagher
and the OLR also describes the facts giving
rise to Attorney Meagher's violation of SCR
20:8.4(b). In April 2002, Attorney Meagher
entered a guilty plea to one count of
violating the federal Wire Wagering Act, 18
U.S.C. § 1084, by virtue of his ownership
interest in Gold Medal Sports (GMS), an
offshore gambling operation that took sports
bets from United States citizens via wire
communications. On July 18, 2002, Attorney
Meagher was sentenced to one-month's
imprisonment followed by five months of home
confinement without electronic monitoring
and one year of supervised release. Attorney
Meagher also paid a $20,000 fine. Attorney
Meagher stipulated that this conviction and
the circumstances surrounding it demonstrate
that Attorney Meagher engaged in criminal
conduct that reflects adversely on a
lawyer's honesty, trustworthiness or fitness
as a lawyer in other respects in violation
of SCR 20:8.4(b).
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21. In addition to stipulating to the
misconduct
set forth above, the parties stipulated to
discipline in the form of a six-month
suspension of Attorney Meagher's license to
practice law in Wisconsin, to be imposed
retroactive to the date of his temporary
suspension, November 12, 2002. The
stipulation provides further that it is not
the result of a plea bargain and reflects
neither a reduction of the charges nor a
reduction of the level of discipline
originally sought by the OLR. The OLR is not
seeking imposition of costs in this matter.
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22. We approve the stipulation and adopt
the
stipulated facts and conclusions of law. We
agree that Attorney Meagher's misconduct
warrants the suspension of his license to
practice law. We accept the parties'
stipulation that a six-month suspension,
imposed retroactive to November 12, 2002,
the date his license was temporarily
suspended, is appropriate discipline for
this offense. Therefore,
23. IT IS ORDERED that the license of
Bruce
J. Meagher to practice law in Wisconsin is
suspended for a period of six months,
effective November 12, 2002.
24. IT IS FURTHER ORDERED that, if he
has
not already done so, Attorney Bruce J.
Meagher must comply with the provisions of
SCR 22.26 concerning the duties of a person
whose license to practice law in Wisconsin
has been suspended.
25. PATIENCE D. ROGGENSACK, J., did not
participate.
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