Oregon State Bar Bulletin — OCT0BER 2004

Discipline

Note: More than 12,200 persons are eligible to practice law in Oregon. Some of them share the same name of similar names. All discipline reports should be read carefully for names, addresses and bar numbers.

ANTHONY L. WORTH
OSB # 89145
Pendleton
120-day suspension

On July 1, 2004, the Oregon Supreme Court filed an opinion finding that Pendleton attorney Anthony L. Worth violated DR 1-102(A)(3) (misrepresentation), DR 1-102(A)(4) (conduct prejudicial to the administration of justice), DR 6-101(A) )(failure to provide competent representation) and DR 6-101(B) (neglect of a legal matter). The court suspended Worth for 120 days, effective Aug. 1, 2004.

In February 2000, a client retained Worth to pursue claims against her former landlord for violations of the landlord tenant laws. Worth filed the complaint in May 2000, and served the defendants in August 2000. Under local court rules, the parties had 21 days in which to select an arbitrator and 49 days after that to hold a hearing before the arbitrator. Between September 2000 and November 2001, Worth failed to comply with court rules and took little action on the case. In February 2001, the court sent the parties a notice of intent to dismiss the case unless a written motion to retain the case on the docket was filed by March 22, 2001.

Worth filed a motion to retain the case on the docket in early April 2001. The hearing on the motion was rescheduled to accommodate Worth’s vacation. On June 29, 2001, the court held a hearing on the motion. The court told the parties that it would retain the case on the docket but it expected Worth to comply with the arbitration rules and set the case for a hearing before an arbitrator before Aug.17, 2001. Local court rules put the burden on the plaintiff to notify the arbitrator and arrange for the arbitration hearing. An arbitrator was selected that day.

In late July 2001, Worth arbitrarily selected a date for depositions 3 days before the deadline imposed by the court and sent notice to the defendants’ counsel. Defendant’s counsel promptly notified Worth that he was unavailable because of a planned vacation and suggested an earlier date as an alternative. In mid-September 2001, Worth sent defendants’ counsel a letter suggesting that depositions be scheduled in October.

Thereafter, defendants’ counsel filed a motion to dismiss the case for want of prosecution. Worth filed an affidavit opposing the motion in which he made representations that implied that depositions had been scheduled on more than one occasion.

In November 2001, the court held a hearing on the defendants’ motion to dismiss Worth’s client’s case. As of that time, the case was essentially in the same posture that it had been over a year before. Among other representations, Worth told the court that he had "really tried to push" the case forward. He also represented that he had telephoned the arbitrator’s office and that "someone" had told him to get back to the arbitrator when discovery was complete before scheduling the arbitration hearing.

The trial court telephoned the arbitrator during the hearing. The arbitrator reported that he did not recognize the case name; he did not remember that Worth had ever called his office; he had received no telephone messages concerning Worth’s case and that he handled all scheduling himself. The arbitrator explained that his staff would have taken a message for him and would not have told a caller to get back to them after discovery was complete. After hearing from the arbitrator, the court dismissed Worth’s client’s case. The arbitrator’s staff confirmed the arbitrator’s report to the court.

The supreme court found that Worth’s statements to the court were not accurate or true and that they were material in that they expressed or implied that Worth had acted more diligently, which could have affected how the trial court evaluated the defendants’ motion to dismiss.

Worth was admitted to practice in Oregon in 1989. He had no prior record of discipline at the time of the misconduct in this case, although he was suspended in another matter in 2003.

ROBERT S. SHATZEN
OSB #93102
Hillsboro
120-day suspension

On July 6, 2004, a trial panel suspended Hillsboro lawyer Robert Shatzen from the practice of law for 120 days for violation of DR 1-102(A)(3), DR 2-101(A)(1), DR 2-102(A) and DR 1-103(C), effective Sept. 8, 2004.

In addition to being a lawyer, Shatzen was also a certified of public accountant whose certification lapsed at the end of June 1983. Thereafter, Shatzen falsely advertised in various telephone directories that he was a CPA, falsely listed himself as a CPA in the bar membership directory, and falsely represented to at least two of his clients that he was a CPA. Shatzen also failed to respond to inquiries from the bar.

In addition to suspending Shatzen for 120 days, the trial panel ordered that he be required to undergo formal reinstatement under BR 8.1 at such time as he seeks to return to active status with the bar.

JAMES E. LEUENBERGER
OSB #89154
Lake Oswego
Public reprimand

On July 15, 2004, the Oregon Supreme Court reprimanded Lake Oswego attorney James E. Leuenberger, for violating DR 5-101(A) in connection with his representation of defendants in a foreclosure action.

During the representation, the trial court entered two judgments imposing sanctions against both Leuenberger and his clients for bringing ex parte motions for an improper purpose, specifically, to delay foreclosure. (The bar charged Leuenberger with several disciplinary violations in connection with these ex parte motions, but the court dismissed those charges.)

The clients’ residence was ultimately foreclosed upon, but the sale proceeds proved insufficient to pay all of the creditor’s judgments (the principal judgment plus the two sanctions judgments for which Leuenberger was also liable).

Leuenberger thereupon brought a motion to determine which of the creditor’s judgments should be considered satisfied by payment of the foreclosure funds. Opposing counsel and then the circuit court judge observed that this motion put Leuenberger in a conflict of interest with his clients, since Leuenberger had a financial interest in seeing that the sanction judgments be satisfied out of his clients’ funds rather than his own. However, it was arguably in the clients’ best interest to satisfy the principal judgment first, since it carried an interest rate of 13.89 percent, while the sanction judgments only carried a 9 percent interest rate.

Leuenberger rejected the notion that he had a conflict. In his opinion, his clients were not at risk because the creditor was not legally entitled to collect from them amounts exceeding the amount received through sale of the security (their house.) Leuenberger discussed the matter with the clients, and they agreed to his proposed course of action, but he did not make full, written disclosures of the possible conflict.

The supreme court found that these were circumstances in which Leuenberger’s professional judgment "reasonably (might have been) affected" by his own financial interest. His clients were entitled to the opportunity to seek independent legal advice; his failure to make full disclosure under DR 10-101(B) therefore put him in violation of DR 5-101(A).

Leuenberger had no prior disciplinary record, and except for his substantial legal experience at the time of his misconduct, there were no aggravating factors. In mitigation, the court noted delay since the occurrence of the misconduct. The court therefore imposed a public reprimand.

KITTY ARAIYAMA
OSB #81043
Pleasant Hill
6-month suspension

On July 15, 2004, the disciplinary board approved a stipulation for discipline suspending Pleasant Hill lawyer, Kitty Araiyama for 6 months for violations of DR 1-102(A)(2) (criminal conduct reflecting on fitness to practice); DR 1-102(A)(3) (misrepresentation) and ORS 9.527(2) (conviction of misdemeanor involving moral turpitude). The suspension was effective Aug.15, 2004.

In 1998, Araiyama met and became a caregiver for a person who for years had been receiving Social Security disability benefits. At some point thereafter, the Social Security Administration became suspicious that the benefit recipient was exaggerating his claims and began surveillance of him and Araiyama.

In 2000, Araiyama participated in an interview with a benefits investigator, wherein she falsely reported the severity of the benefit recipient’s disability, including false representations about his capacity to care for himself and to drive. These representations led to a criminal charge against Araiyama and a conviction for theft, treated as a misdemeanor by the court.

Araiyama had no prior disciplinary record. The stipulation recited, among other mitigating factors, that she was experiencing personal and emotional problems at the time of the misconduct and was cooperative in the bar proceedings.

JIM CARPENTER
OSB # 00436
John Day
Public reprimand

On July 29, 2004, the Oregon Supreme Court publicly reprimanded John Day lawyer Jim Carpenter for violating DR 1-102(A)(3) (conduct involving dishonesty, deceit, fraud, or misrepresentation).

Carpenter had been a member of the bar five months when he decided to play a practical joke on a former high school acquaintance. Carpenter knew that this acquaintance was now a teacher, counselor and coach at the same high school that they both had attended. Carpenter filled out an online form on Classmates.com, setting up an account in the name of the acquaintance ("teacher"). He then posted a message, purportedly from the teacher, implying that the teacher was having sexual relations with girls at the school. Carpenter testified that at the time he posted this message, he had heard rumors to this effect.

After Carpenter posted the message, someone sent a printed copy of it, together with an angry letter, to the high school’s principal, the school superintendent and members of the school board. The letter demanded that the teacher be held accountable.

Based on the letter, school officials initiated inquiry. After the teacher denied posting the message or engaging in sexual relationships with students, the principal and the superintendent charged him with finding out who had posted the message. The teacher went to the police, who subpoenaed Classmates.com’s records and discovered that Carpenter was responsible.

A majority of the court found that Carpenter’s conduct violated DR 1-102(A)(3). The teacher was uniquely vulnerable to the content of the message, and Carpenter’s conduct created a significant risk of harming the teacher’s career and subjecting him to criminal investigation. Carpenter’s disregard for the teacher’s legal rights caused the court to question whether Carpenter possessed the requisite trustworthiness and integrity to handle important matters involving clients’ legal rights. Carpenter’s dishonest conduct therefore reflected adversely on his fitness to practice law in violation of DR 1-102(A)(3).

In mitigation, Carpenter had no prior disciplinary record, was cooperative with the disciplinary proceedings, was inexperienced in the practice of law and showed genuine remorse. Because the mitigating factors outweighed the aggravating ones, the court imposed a public reprimand.

Justices Balmer and Kistler dissented. In their opinion, Carpenter’s conduct — although dishonest — did not violate the disciplinary rules.

J. MICHAEL SMITH
OSB #76333
Salem
180-day suspension

On Aug. 24, 2004, the disciplinary board approved a stipulation for discipline suspending Salem lawyer J. Michael Smith for 180 days for violation of DR 1-102(A)(3), DR 3-101(B) and ORS 9.160, effective Oct. 23, 2004.

In mid-summer 2002, Smith was suspended from the practice of law for failing to pay his membership dues. Thereafter, Smith continued to engage in the practice of law. Although he took some steps toward reinstatement, Smith failed to complete the reinstatement process until the fall of 2002. In connection with his application for reinstatement, Smith signed an affidavit in which he misrepresented that he had not engaged in the practice of law during the period of suspension.

GERSHAM GOLDSTEIN
OSB #63029
Portland
Public reprimand

Effective Aug. 29, 2004, the disciplinary board approved a stipulation reprimanding Portland lawyer Gersham Goldstein for violating DR 5-105(C) (former client conflict of interest) and DR 5-105(E) (current client conflict of interest).

Goldstein represented two individuals who were husband and wife, and their jointly owned business, in some tax matters. The two individuals were subsequently indicted on charges relating primarily to tax matters. After the indictment, Goldstein continued to represent both individuals, and provided oral disclosures to them regarding the likely conflict between them. He failed to contemporaneously confirm the oral disclosures in writing.

The government then made a plea offer in which the husband would plead guilty to one charge, while all charges against the wife would be dismissed. Goldstein arranged for the husband to be represented by another lawyer, but, at that lawyer’s request, continued to perform some work for husband. He also continued to represent wife in the criminal matter, and the husband in other matters. Goldstein continued that representation without obtaining consent after full disclosure from husband and wife.

A few years later, husband was no longer an officer or director in the business, but continued to be an employee. Another lawyer in Goldstein’s office undertook to represent the business with respect to issues concerning the husband’s continued employment. Goldstein continued to represent the husband in other matters without obtaining consent after full disclosure from husband, wife and the business.


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