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ATTORNEY disciplinary
proceeding. Attorney's license
revoked.
¶1 PER CURIAM. We review the
recommendation of the referee to revoke
Attorney Jay Andrew Felli's license to
practice law in Wisconsin due to
professional misconduct. The misconduct
involves dishonesty, fraud, deceit or
misrepresentation, contrary to SCR 20:8.4
(c). No appeal has been filed.
¶2 We approve the referee's findings
of fact and conclusions of law. We
determine that the seriousness of Attorney
Felli's misconduct warrants revocation of
his license to practice law. We assess
costs of the disciplinary proceeding
against Attorney Felli.
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¶3 Attorney Felli was admitted to
practice in 1994 and practiced in
Brookfield, Wisconsin. His prior
disciplinary history includes a public
reprimand for failing to act with
reasonable diligence and promptness in
representing a client; willfully failing to
provide relevant information to the Office
of Lawyer Regulation (OLR); and failing to
admit misrepresentations to the OLR in
connection with the investigation of two
client matters. See In re
Disciplinary Proceedings Against Felli,
2005 WI 58, 281 Wis. 2d 25, 697 N.W.2d 42
(Felli I).
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¶4 Following a separate proceeding,
Attorney Felli's license to practice law in
Wisconsin was suspended for three years
effective July 27, 2006, for professional
misconduct. The misconduct consisted of
multiple rules violations in various estate
matters, and included: (1) SCR 20:7.3(f),
prohibiting a lawyer from drafting
documents which implied that his services
be used in connection with that document by
causing himself to be named trustee,
personal representative, or guardian or by
providing himself with an actual power of
attorney in the representation of these
other clients; (2) SCR 20:1.7(b),
prohibiting conflicts of interest; (3) SCR
20:1.1, requiring competent representation;
(4) SCR 20:8.4(c), prohibiting conduct
involving dishonesty, fraud, deceit and
misrepresentation; (5) SCR 20:1.4(b),
requiring explanations to permit the client
to make informed decisions regarding
representation, and (6) SCR 22:03(6),
prohibiting a lawyer from willfully failing
to provide information and making
misrepresentations to the OLR. See
In re Disciplinary Proceedings Against
Felli, 2006 WI 73, 291 Wis. 2d 529, 718
N.W.2d 70 (Felli II).
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¶5 In the instant matter, the OLR has
filed a disciplinary complaint alleging
that while trustee of a charitable trust
which he had created on behalf of his
client, J.G., Attorney Felli fraudulently
wrote a $2500 check drawn on the trust as
payable to a business he owned. The
disciplinary complaint alleges that
Attorney Felli attempted to disguise the
check as a charitable contribution on
behalf of the trust. The complaint charged
Attorney Felli with engaging in conduct
involving dishonesty, fraud, deceit or
misrepresentation, contrary to SCR 20:8.4
(c).
¶6 Following a June 27, 2005 hearing,
the referee determined that the complaint's
allegations were proven by clear,
satisfactory and convincing evidence. The
referee found that after J.G. retained
Attorney Felli, he drafted documents to
create a lead charitable trust and
appointed himself trustee. In August 2004
the trust was funded with $1 million
deposited in a securities account.
Attorney Felli provided for trustee fees in
the amount of 1.75 percent of the trust
assets each year. Six percent of the
assets were to be distributed to charity
each year until the trust terminated on
December 31, 2020. The trust agreement did
not specify the charitable beneficiaries to
be selected. Although Attorney Felli had
sole authority to select the charitable
beneficiaries, he had made clear to J.G.
that she would have input on selection of
the charitable beneficiaries and the
beneficiaries would be jointly selected.
¶7 Attorney Felli owned a company
called Phoenix Customs, LLC, located in
Franklin, Wisconsin, of which he was the
sole member. The business built
motorcycles and sold parts. Phoenix
Customs, LLC had an account with the Tri-
City National Bank.
¶8 In November 2004 Attorney Felli
wrote a $2500 check drawn on trust assets
to "Phoenix." The memo line on the check
read "Ch. Contribution." Attorney Felli
admitted he wrote the check, but claimed
that he intended it to be a contribution to
a charity named Phoenix House, which
operates shelters for women. J.G.
testified she never had any discussions
with Attorney Felli about the Phoenix House
or any other entity with the name of
Phoenix, and never authorized Attorney
Felli to make a charitable distribution to
an entity with Phoenix in its title.
¶9 Attorney Felli endorsed the check
written out to "Phoenix." On November 12,
2004, the check was deposited in his
business, Phoenix Customs, account at Tri-
City National Bank. Attorney Felli claims
that the handwriting on the deposit slip is
not his.
¶10 J.G. became aware of the check to
Phoenix on November 17, 2004, when her son
noticed a $2500 withdrawal and asked her
what it was for. She stated she had not
authorized Attorney Felli to pay $2500 to
anyone, nor had she been informed that he
was going to do so. After obtaining a copy
of the check, J.G. contacted another
attorney who demanded Attorney Felli return
the $2500 paid to Phoenix along with his
trustee fees. Attorney Felli complied on
December 21, 2004.
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¶11 According to Attorney Felli, he had
simply mishandled the check and he claimed
he was innocent of any wrongdoing.
Attorney Felli's initial response to the
OLR stated that he apparently saw the
Phoenix check, endorsed it, and deposited
it into the "Phoenix Customs" account.
Later he stated that it was not until he
saw the OLR's discovery materials that he
noticed for the first time the deposit slip
was not in his handwriting, so he could not
have deposited the check. The referee
rejected Attorney Felli's explanations.
The referee found that Attorney Felli
intentionally attempted to divert assets
from his client's trust account to his
motorcycle business, contrary to SCR 20:8.4
(c).
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¶12 With respect to discipline, the
referee noted that repetitive offenses
warrant progressively harsher sanctions.
See In re Disciplinary Proceedings
Against Converse, 2006 WI 4, 287 Wis. 2d
72, 707 N.W.2d 530. The referee stated
that both Felli I and Felli II
involved serious misconduct related to the
misconduct in the instant matter. The
referee stated this case involves Attorney
Felli's substantial disregard of his
fiduciary obligations and willingness to
leverage his position of trust. The
referee noted that while the amount
Attorney Felli attempted to take was
relatively small, "the line that he crossed
is an important one." The referee stated
that combined with the misconduct in
Felli I and Felli II, Attorney
Felli demonstrated an inability to conform
to professional standards. The referee
also considered that each disciplinary
proceeding involved the willful failure to
disclose information to the OLR.
Therefore, the referee concluded that
Attorney Felli's continued practice of law
would create a substantial risk and nothing
short of revocation would protect the
public.
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¶13 This court upholds the referee's
findings of fact unless clearly erroneous.
See In re Disciplinary Proceedings
Against Carroll, 2001 WI 130, ¶29, 248
Wis. 2d 662, 636 N.W.2d 718. This court
independently reviews the referee's legal
conclusions. Id. Here, the record
supports the referee's fact findings and
legal conclusions, and they are
unchallenged. This court approves and
adopts the referee's findings of fact and
conclusions of law.
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¶14 It is ultimately this court's
responsibility to determine the appropriate
discipline. See In re Disciplinary
Proceedings Against Reitz, 2005 WI 39,
¶74, 279 Wis. 2d 550, 694 N.W.2d 894.
Proper considerations include the
seriousness of the misconduct; the need to
protect the public, courts, and the legal
system from repetition of misconduct; the
need to impress upon the attorney the
seriousness of the misconduct, and the need
to deter other attorneys from engaging in
similar misconduct. See In re
Disciplinary Proceedings Against Arthur,
2005 WI 40, ¶78, 279 Wis. 2d 583, 694
N.W.2d 910.
¶15 The seriousness of Attorney Felli's
most recent professional misconduct,
combined with his disciplinary history,
demonstrates that it is necessary to revoke
his license to practice law in Wisconsin,
to protect the public, courts, and legal
system from the repetition of misconduct,
as well as to impress upon Attorney Felli
the seriousness of his misconduct and deter
other attorneys from engaging in
misconduct.
¶16 The OLR filed a statement on
December 18, 2006, of $8924.80 for costs.
Attorney Felli is ordered to pay the costs
of this disciplinary proceeding.
¶17 IT IS ORDERED that the license of
Jay Andrew Felli to practice law in
Wisconsin is revoked, effective the date of
this opinion.
¶18 IT IS FURTHER ORDERED that within
60 days of the date of this order Jay
Andrew Felli pay to the Office of Lawyer
Regulation the costs of this proceeding.
If the costs are not paid within the time
specified, and absent a showing to this
court of his inability to pay the costs
within that time, the license of Jay Andrew
Felli will remain revoked until further
order of the court.
¶19 IT IS FURTHER ORDERED that to the
extent he has not done so, Jay Andrew Felli
comply with the provisions of SCR 22.26
concerning the duties of a person whose
license to practice law in Wisconsin has
been revoked.
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