Case Title: Disciplinary Counsel v. Crosby

Citation: 2012-Ohio-2872

Docket Number: 2011-1453

State: ohio

Court: Ohio Supreme Court

Date: 2012-06-28T00:00:00Z

Document:
[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as 
Disciplinary Counsel v. Crosby, Slip Opinion No. 2012-Ohio-2872.] 
 
 
 
 
NOTICE 
This slip opinion is subject to formal revision before it is published in 
an advance sheet of the Ohio Official Reports.  Readers are requested 
to promptly notify the Reporter of Decisions, Supreme Court of Ohio, 
65 South Front Street, Columbus, Ohio 43215, of any typographical or 
other formal errors in the opinion, in order that corrections may be 
made before the opinion is published. 
 
SLIP OPINION NO. 2012-OHIO-2872 
DISCIPLINARY COUNSEL v. CROSBY. 
[Until this opinion appears in the Ohio Official Reports advance sheets,  
it may be cited as Disciplinary Counsel v. Crosby,  
Slip Opinion No. 2012-Ohio-2872.] 
Attorneys—Misconduct—Multiple violations of the Disciplinary Rules—Previous 
ongoing license suspensions—Disbarment. 
(No. 2011-1453—Submitted December 7, 2011—Decided June 27, 2012.) 
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and 
Discipline of the Supreme Court, No. 10-091. 
__________________ 
 
Per Curiam. 
{¶ 1} Respondent, William Matthew Crosby of Cleveland, Ohio, 
Attorney Registration No. 0002451, was admitted to the practice of law in Ohio in 
1982.  In 2009, we suspended Crosby from the practice of law in Ohio for 24 
months, with reinstatement conditioned upon his satisfaction of numerous 
judgments.  Disciplinary Counsel v. Crosby, 124 Ohio St.3d 226, 2009-Ohio-
6763, 921 N.E.2d 225, ¶ 22-34.  We have since suspended Crosby’s license to 
SUPREME COURT OF OHIO 
2 
 
practice law for an interim period pursuant to Gov.Bar R. V(5)(A)(3), due to his 
felony conviction.  In re Crosby, 127 Ohio St.3d 1424, 2010-Ohio-5295, 936 
N.E.2d 72.  In addition, Crosby’s license is under suspension because he has 
failed to register as an attorney for the current biennium.  In re Attorney 
Registration of Crosby, 130 Ohio St.3d 1420, 2011-Ohio-5627, 956 N.E.2d 310. 
{¶ 2} The Board of Commissioners on Grievances and Discipline 
recommends that we disbar Crosby, based on his repeated misconduct and 
multiple violations of the Code of Professional Responsibility.1  We agree that 
Crosby committed professional misconduct as found by the board, and we accept 
the recommendation of disbarment. 
{¶ 3} In January 2011, relator, disciplinary counsel, filed a five-count 
amended complaint against Crosby, alleging multiple violations of the Code of 
Professional Responsibility.  Crosby answered, and a panel of the board held a 
hearing on the complaint in June 2011 and proceeded on the evidence presented 
there, as well as on the stipulated exhibits and facts.  After the hearing, the panel 
made findings of fact and conclusions of law and recommended disbarment.  The 
board adopted the panel’s report in its entirety.  Crosby filed objections to the 
board’s recommendation, asserting that his misconduct warrants only a two-year 
suspension, to run concurrently with the suspensions already imposed.  We 
overrule Crosby’s objections and adopt the board’s recommendation to disbar. 
Misconduct 
Count One (The Tax Matter) 
{¶ 4} The parties stipulated that in 2010, Crosby pled guilty to federal 
charges of attempted income-tax evasion, a felony, having failed to file tax returns 
from 2001 through 2006.  As part of his sentence, the court ordered Crosby to pay 
                                      
1 Disciplinary counsel charged Crosby with misconduct under the Disciplinary Rules because he 
allegedly committed the acts before February 1, 2007, the effective date of the Rules of 
Professional Conduct. 
 
January Term, 2012 
3 
 
$314,637 to the IRS.  United States v. Crosby, N.D.Ohio No. 1:10cr253 (Sept. 23, 
2010).  Crosby stipulates that he has not made any restitution. 
{¶ 5} The parties further stipulated that Crosby used his Interest on 
Lawyers’ Trust Accounts (“IOLTA account”) to hide his income from the IRS.  
They agree that Crosby violated DR 1-102(A)(3) (prohibiting a lawyer from 
engaging in illegal conduct involving moral turpitude), 1-102(A)(4) (prohibiting a 
lawyer from engaging in conduct involving dishonesty, fraud, deceit, or 
misrepresentation), 1-102(A)(5) (prohibiting a lawyer from engaging in conduct 
that is prejudicial to the administration of justice), and 1-102(A)(6) (prohibiting a 
lawyer from engaging in conduct that adversely reflects on the lawyer’s fitness to 
practice law). 
Count Two (The J.R. and B.P. Matter) 
{¶ 6} In June 2002, Crosby filed a lawsuit against the Catholic Diocese 
of Cleveland and others (“the Catholic Church”) on behalf of J.R. and B.P., who 
alleged that they had been sexually abused by a Catholic priest.  Crosby and J.R. 
agreed to a contingent fee, but because of a dispute over the timing of a 
handwritten revision, the percentage agreed to is unclear.  Jeffrey Anderson, an 
attorney from Minnesota, served as co-counsel.  Crosby failed to advise J.R. and 
B.P. that he did not maintain malpractice insurance, failed to provide them with a 
written notice containing this information, and did not obtain their signatures on 
any such written notice. 
{¶ 7} In January 2003, J.R., represented by different counsel, filed for 
bankruptcy and listed the lawsuit against the Catholic Church as an asset.  The 
bankruptcy court eventually issued an order discharging J.R.’s debts.  After this 
discharge, Crosby settled the lawsuit with the Catholic Church on behalf of J.R. 
for $175,000.  Anderson instructed Crosby to prorate the costs and expenses 
among their clients.  When Crosby presented the settlement agreement to J.R., he 
SUPREME COURT OF OHIO 
4 
 
urged J.R. to sign it without reading it, so J.R. was unaware that his legal matter 
had been settled for $175,000. 
{¶ 8} Crosby received the $175,000 settlement check payable to J.R. and 
Crosby’s law firm.  Although Crosby did not have a power of attorney from J.R. 
or permission to sign, Crosby signed J.R.’s name “(per POA)” on the back of the 
check.  Crosby failed to prepare a settlement distribution sheet for J.R., but he 
charged J.R. a 40 percent contingency fee, plus $10,000 for expenses.  Crosby did 
not promptly disburse any of the remaining $95,000 settlement funds to J.R. 
{¶ 9} Crosby also failed to inform the bankruptcy court about the J.R. 
settlement or seek bankruptcy court approval for the settlement agreement or the 
attorney fees.  After J.R.’s bankruptcy attorney advised the court that J.R.’s “case 
against the diocese has apparently been settled for $175,000,” Crosby disbursed 
$5,000 to J.R. from his settlement funds, identifying the check as a “net 
distribution exemption.”  Two months later, Crosby disbursed $10,000 to J.R. 
from his settlement funds in his IOLTA account.  Eight months after that, Crosby 
disbursed the remaining $80,000 to J.R., identifying this payment as the “final 
distribution.” 
{¶ 10} Crosby failed to turn over funds and provide documentation to the 
bankruptcy court regarding the J.R. settlement.  As a result, the bankruptcy trustee 
filed a complaint for monetary damages against Crosby and J.R., seeking the 
remaining $80,000 in settlement funds paid to J.R. and the $17,500 in settlement 
funds paid to Crosby as attorney fees, and the court revoked J.R.’s discharge of 
his debts.  Two years later, the bankruptcy court granted summary judgment in 
favor of the trustee and against Crosby and J.R., jointly and severally, for 
$35,257.16 and against Crosby for $17,500. 
{¶ 11} As to Count Two, the panel concluded and the board agreed that 
Crosby’s conduct violated DR 1-102(A)(4), 1-102(A)(5), 1-102(A)(6), 1-104 
(requiring a lawyer to inform a client if the lawyer does not maintain professional-
January Term, 2012 
5 
 
liability insurance), 7-102(A)(3) (prohibiting a lawyer from concealing or 
knowingly failing to disclose that which he is required by law to reveal), 7-
102(A)(7) (prohibiting a lawyer from counseling or assisting his client in conduct 
that the lawyer knows to be illegal or fraudulent), and 9-102(B)(3) (requiring a 
lawyer to maintain complete records of all funds, securities, and other properties 
of a client in the possession of the lawyer and render appropriate accounts to his 
client regarding them). 
Count Three (The IOLTA-Account Matter) 
{¶ 12} In July 2003, Crosby deposited a check for $175,000, representing 
J.R.’s settlement proceeds, into his IOLTA account.  After deducting a 40 percent 
contingent fee and a $10,000 expense reimbursement, Crosby owed J.R. $95,000.  
The next month, Crosby disbursed $5,000 to J.R. from this settlement.  After J.R. 
cashed the check, Crosby’s IOLTA account should have held a balance of at least 
$90,000, reflecting the funds still owed to J.R.  Instead, the balance in Crosby’s 
IOLTA account was $82,959.84. 
{¶ 13} Two months later, Crosby disbursed an additional $10,000 to J.R.  
Crosby’s IOLTA account should have then held a balance of at least $80,000, 
reflecting the funds still owed to J.R.; however, the balance in Crosby’s IOLTA 
account was $4,619.84. 
{¶ 14} In May 2004, Crosby’s IOLTA account balance was $43.52 when 
he deposited $500,001 in unrelated settlement proceeds, which he used to 
disburse the remaining $80,000 to J.R.  Because Crosby’s IOLTA account 
balance was below the amount of settlement funds owed to J.R. and being 
purportedly held by Crosby in his IOLTA account, Crosby misappropriated funds 
belonging to J.R. 
{¶ 15} As to this count, the panel found and the board agreed that 
Crosby’s conduct violated DR 1-102(A)(4), 1-102(A)(6), and 9-102(B)(3). 
 
 
SUPREME COURT OF OHIO 
6 
 
Count Four 
(The J.R., B.P., M.A., H.F., and J.G. Matter) 
{¶ 16} Crosby undertook representation of J.R., B.P., M.A., H.F., and 
J.G., who alleged that they had been sexually abused by a Catholic priest, in 
claims against the Catholic Church.  Crosby entered into a contingent-fee 
agreement with J.G. and M.A. for this representation.  This agreement advised 
them that Minnesota attorney Jeffrey Anderson would be acting as co-counsel.  
When the defendants and Crosby’s clients settled the lawsuit, Anderson provided 
Crosby with a bill for $15,579.21 in costs and expenses. 
{¶ 17} Because Crosby and Anderson were involved in representing 
several parties against the Catholic Church, Anderson advised Crosby that his 
costs and expenses should be prorated among the plaintiffs.  In June 2003, when 
Crosby received $800,000 in settlement checks for the five clients, he prepared a 
settlement-distribution sheet for J.G. and M.A., which stated that each paid a 40 
percent contingent fee and $5,000 for his share of case-related expenses.  J.G. and 
M.A. signed these statements.  Ultimately, Crosby’s five clients paid $30,000 for 
expenses, twice as much as documented. 
{¶ 18} As to this count, the panel concluded and the board agreed that 
Crosby’s misconduct violated DR 1-102(A)(4), 1-102(A)(5), 1-102(A)(6), 1-
104(A), 7-102(A)(3), 9-102(B)(3), and 9-102(B)(4) (requiring a lawyer to 
promptly deliver to the client the funds, securities, or other properties to which the 
client is entitled). 
Count Five (The Malpractice Matter) 
{¶ 19} In 2009, Crosby was cross-examined in a malpractice lawsuit filed 
against him by J.R.  Crosby testified that J.R. had given Crosby a power of 
attorney and that the $175,000 settlement check was deposited pursuant to that 
power of attorney.  Crosby also testified that he kept $80,000 of the settlement 
January Term, 2012 
7 
 
proceeds owed to J.R. in his IOLTA account for almost one year because “that’s 
where [J.R.] directed [Crosby] to maintain the funds.” 
{¶ 20} When J.R. and his legal counsel filed a grievance with disciplinary 
counsel alleging that Crosby had engaged in ethical misconduct in the handling of 
the lawsuit for J.R. and the other four clients, Crosby replied that he “did not 
advise [J.R.] to make misrepresentations to the bankruptcy court” and that “[all 
five clients] received every dollar due under their settlement agreements.”  He 
further testified that he had “had no involvement with nor further notice of any 
events involving the [J.R.] bankruptcy” beyond the fact that he “understood that 
under bankruptcy law [J.R.] was entitled to the first $5,000 of his proceeds, and 
probably additional proceeds once the question of his ‘exemption under Ohio law’ 
was settled.”  Crosby added that he had “consulted with the Cleveland bankruptcy 
attorney about this matter, and mentioned to J.R. that he may want to speak with 
this lawyer.” 
{¶ 21} As to Count Five, the panel and board agreed that Crosby’s 
misconduct violated DR 1-102(A)(4), 1-102(A)(5), 1-102(A)(6), and Gov.Bar R. 
V(4)(G) (requiring cooperation with disciplinary counsel’s investigation of 
misconduct). 
Aggravation and Mitigation 
{¶ 22} The panel and board found the following aggravating factors: prior 
disciplinary offense; dishonest or selfish motive; pattern of misconduct; multiple 
offenses; false statements made during the disciplinary process; and vulnerable 
clients, who had apparently been abused not only by a priest, but by the lawyer 
they trusted to right the wrongs that had been done to them as children.  And as to 
J.R., the panel and board found that Crosby’s conduct had caused him to lose his 
bankruptcy protection.  Finally, Crosby still owes the full restitution amount of 
$314,637 to the IRS.  BCGD Proc.Reg. 10(B)(1)(a), (b), (c), (d), (f), (h), and (i). 
SUPREME COURT OF OHIO 
8 
 
{¶ 23} The panel and board found the following mitigating factors: 
imposition of other penalties or sanctions and alcohol dependency.  BCGD 
Proc.Reg. 10(B)(2)(f) and (g).  However, Crosby provided no competent evidence 
that his alleged alcohol dependency contributed to cause the misconduct charged 
here. 
Sanction 
{¶ 24} Disciplinary counsel recommends that Crosby be disbarred.  The 
panel and board also recommend disbarment.  Crosby seeks a two-year 
suspension, to run concurrently with his other suspensions, and asks that 
treatment for alcohol abuse and mental illness be ordered. 
{¶ 25} Crosby argues that the permanent disbarment exceeds the penalty 
that this court has imposed in similar cases.  When imposing sanctions for 
attorney misconduct, we consider relevant factors, including the ethical duties that 
the lawyer violated and the sanctions imposed in other cases.  Stark Cty. Bar 
Assn. v. Buttacavoli, 96 Ohio St.3d 424, 2002-Ohio-4743, 775 N.E.2d 818, ¶ 16.  
In making a final determination, we also weigh evidence of the aggravating and 
mitigating factors listed in BCGD Proc.Reg. 10(B).  Disciplinary Counsel v. 
Broeren, 115 Ohio St.3d 473, 2007-Ohio-5251, 875 N.E.2d 935, ¶ 21. 
{¶ 26} Crosby argues that this court has routinely applied one-year 
suspensions, with credit for the period of any interim suspension, to attorneys who 
were convicted of tax evasion or fraud.  However, with regard to Count One 
alone, Crosby’s misconduct warrants disbarment.  Crosby failed to file tax returns 
or pay his personal taxes for six years, intentionally used his IOLTA account to 
conceal assets from the IRS, and was convicted of felony attempted tax evasion. 
{¶ 27} Similar cases have resulted in disbarment.  In Dayton Bar Assn. v. 
Schram, 122 Ohio St.3d 8, 2009-Ohio-1931, 907 N.E.2d 311, Schram failed to 
file income-tax returns for 20 years, failed to pay federal withholding taxes for her 
employees, and was convicted of felony tax crimes.  Id. at ¶ 9.  Like Crosby, 
January Term, 2012 
9 
 
Schram had a prior disciplinary record and had failed to make complete restitution 
to the IRS.  Id. at ¶ 12.  This court disbarred Schram.  Id. at ¶ 13.  Although 
Crosby’s failure to file federal income-tax returns and failure to pay federal 
income taxes was for six years rather than 20, Crosby’s other aggravating factors 
make disbarment appropriate. 
{¶ 28} With regard to his other four counts, Crosby stipulated that he 
misappropriated nearly $80,000 in Rivera’s funds, and the board found that 
Crosby had engaged in conduct involving dishonesty, fraud, deceit, or 
misrepresentation when he charged his five clients $30,000 in expenses that in 
fact totaled around $15,000.  As noted by disciplinary counsel, the presumptive 
sanction for misappropriation of client funds is disbarment.  See, e.g., Lorain Cty. 
Bar Assn. v. Fernandez, 99 Ohio St.3d 426, 2003-Ohio-4078, 793 N.E.2d 434, 
¶ 9; Cleveland Bar Assn. v. Dixon, 95 Ohio St.3d 490, 2002-Ohio-2490, 769 
N.E.2d 816, ¶ 27; and Cleveland Bar Assn. v. Belock, 82 Ohio St.3d 98, 100, 694 
N.E.2d 897 (1998) (public confidence in the judicial system and the bar requires 
the strictest discipline for misappropriation cases, and the appropriate discipline 
when a lawyer converts client funds is disbarment). 
Conclusion 
{¶ 29} Crosby lied to the IRS, the bankruptcy trustee, his clients, the 
courts, and disciplinary counsel.  His pervasive dishonesty, combined with his 
misappropriation of client funds, compels us to permanently disbar Crosby from 
the practice of law in Ohio. 
{¶ 30} Costs are taxed to Crosby. 
Judgment accordingly. 
O’CONNOR, C.J., and PFEIFER, LUNDBERG STRATTON, O’DONNELL, 
LANZINGER, CUPP, and MCGEE BROWN, JJ., concur. 
__________________ 
SUPREME COURT OF OHIO 
10 
 
Jonathan E. Coughlan, Disciplinary Counsel, and Robert R. Berger Jr., 
Assistant Disciplinary Counsel, for relator. 
Dworken & Bernstein Co., L.P.A., and Patrick J. Perotti, for respondent. 
______________________