Title: Office of Lawyer Regulation v. Michael D. Mandelman

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2009 WI 40 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2007AP2653-D 
COMPLETE TITLE: 
 
 
In the Matter of Disciplinary Proceedings 
Against Michael D. Mandelman, Attorney at Law: 
 
Office of Lawyer Regulation, 
          Complainant, 
     v. 
Michael D. Mandelman, 
          Respondent. 
 
 
 
 
DISCIPLINARY PROCEEDINGS AGAINST MANDELMAN 
 
 
OPINION FILED: 
May 29, 2009   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
        
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
        
 
COUNTY: 
        
 
JUDGE: 
        
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
      
 
 
 
 
2009 WI 40
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2007AP2653-D  
 
 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
In the Matter of Disciplinary Proceedings 
Against Michael D. Mandelman, Attorney at Law: 
 
Office of Lawyer Regulation, 
 
          Complainant, 
 
     v. 
 
Michael D. Mandelman, 
 
          Respondent. 
 
FILED 
 
MAY 29, 2009 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
ATTORNEY 
disciplinary 
proceeding.   
Attorney's 
license 
suspended. 
 
¶1 
PER CURIAM.   We review the recommendation of the 
referee, 
Jonathan 
V. 
Goodman, 
that 
Attorney 
Michael 
D. 
Mandelman's license to practice law in Wisconsin be suspended 
for one year.  The Office of Lawyer Regulation (OLR) filed a 
disciplinary complaint alleging six counts of misconduct arising 
from three separate matters.  The OLR and Attorney Mandelman 
stipulated to Attorney Mandelman's no contest plea to the 
allegations of the disciplinary complaint.   
No. 
2007AP2653-D   
 
2 
 
¶2 
We conclude the seriousness of Attorney Mandelman's 
misconduct warrants a suspension of his license for a period of 
one year, commencing the date of this decision.  We also impose 
full 
costs 
of 
the 
disciplinary 
proceeding 
and 
require 
restitution as determined in the referee's report.   
¶3 
Attorney Mandelman's disciplinary history consists of 
the following: 
• 
A one-year suspension for 27 rules violations, including 
neglect of client matters, failure to return client 
files 
promptly, 
contacting 
injured 
persons,  
representing multiple clients with adverse interests, 
settling 
a 
client's 
claim 
without 
authorization, 
misrepresentations to Board of Attorneys Professional 
Responsibility (BAPR), attempting to limit potential 
malpractice liability, and trust account violations.  In 
re 
Disciplinary 
Proceedings 
Against 
Mandelman, 
158 
Wis. 2d 1, 460 N.W.2d 749 (1990). 
• 
An 18-month suspension, retroactive to the termination 
of the earlier suspension, for violating various ethics 
rules. 
 
In 
re 
Disciplinary 
Proceedings 
Against 
Mandelman, 182 Wis. 2d 583, 514 N.W.2d 11 (1994).  This 
decision also denied his petition for reinstatement 
because while his suspension was pending, additional 
professional misconduct was discovered, including post-
suspension 
trust 
account 
violations 
and, 
during 
reinstatement 
proceedings, 
he 
gave 
incomplete 
and 
evasive information to BAPR. 
No. 
2007AP2653-D   
 
3 
 
• 
Reinstatement 
of 
Attorney 
Mandelman's 
license 
to 
practice law with the condition of periodic reporting to 
the board of his dealings with client funds and his 
trust account.  In re Reinstatement of Mandelman, 197 
Wis. 2d 435, 541 N.W.2d 480 (1995). 
• 
A private reprimand for misconduct consisting of a false 
statement 
to 
a 
tribunal, 
contrary 
to 
former 
SCR 
20:3.3(a).  Private Reprimand of Michael Mandelman, 
1999-18.   
• 
A nine-month suspension effective July 1, 2006, for 
violations of SCR 20:1.5(c), SCR 20:5.1(c)(2), SCR 
20:1.16(a)(3), former SCR 20:1.15(b), SCR 20:1.8(h), SCR 
20:1.3, 
and 
SCR 
20:8.4(f). 
 
In 
re 
Disciplinary 
Proceedings 
Against 
Mandelman, 
2006 
WI 
45, 
290 
Wis. 2d 158, 
714 
N.W.2d 512. 
 
Attorney 
Mandelman's 
license to practice law remains under suspension as a 
result of the 2006 disciplinary proceeding. 
¶4 
In the current proceedings, consistent with the 
allegations of the disciplinary complaint and the parties' 
stipulation, the referee found six counts of misconduct in the 
following three matters. 
I.  S.M. CLIENT MATTER (COUNTS 1 THROUGH 3) 
¶5 
In 
October 
2000 
S.M. 
suffered 
injuries 
in 
an 
automobile accident.  He retained Attorney G.C. who reached an 
agreement with the adverse driver's insurance carrier for policy 
limits of $25,000.  S.M. also sought recovery from his own 
underinsurance carrier, Hastings Mutual.  Without notifying 
No. 
2007AP2653-D   
 
4 
 
Attorney G.C., S.M. retained the law firm of Reitz and 
Mandelman, LLC.  Subsequently, Attorney Mandelman's partner, 
Jeffrey Reitz, advised Attorney G.C. that he had been discharged 
as S.M.'s attorney.   
¶6 
Attorney G.C., however, had already received the 
$25,000 settlement check and had determined the amount of the 
outstanding medical bills to be paid from the proceeds.  He 
offered to disburse the check proceeds through his trust 
account.  Attorney Mandelman declined and, instead, reached an 
agreement 
with 
Attorney 
G.C. 
to 
reduce 
his 
one-fourth 
contingency fee to $5,000 and arrange for the insurance company 
to reissue the check to the Reitz and Mandelman law firm trust 
account. 
¶7 
In June 2002 the settlement check was deposited in the 
Reitz and Mandelman, LLC, trust account.  Proceeds were issued 
as follows:  $10,000 to S.M., $5,000 along with $293.56 for 
costs to Attorney G.C., and $1,250 to Reitz and Mandelman, LLC.  
This distribution left $8,456.44 to cover medical bills, which 
were outstanding in the sum of $8,045.66.   
¶8 
Attorney Mandelman's office had performed no work to 
obtain the insurance settlement check but nonetheless paid 
itself a $1,250 fee, reflecting the difference between the 
amount that Attorney G.C. would have received under his one-
fourth contingency agreement with S.M. and the $5,000 fee 
Attorney G.C. agreed to accept.  Attorney Mandelman provided no 
information about the disbursements when he sent S.M. his check.   
No. 
2007AP2653-D   
 
5 
 
¶9 
In October 2003 Attorney Mandelman sent a demand 
letter to Hastings Mutual seeking $150,000 policy limits.  
Hastings Mutual responded with a $14,000 offer.  After more than 
two years, no progress had been made toward settlement.  
Although S.M. asked Attorney Mandelman to file suit on several 
occasions, Attorney Mandelman failed to do so.  In March 2004 
Attorney Mandelman wrote to S.M. indicating that he was working 
diligently on the matter.   
¶10 After S.M.'s repeated demands, Attorney Mandelman 
shipped a box of documents to S.M. in June 2006, with a cover 
letter indicating a $42,000 settlement could be reached.  
Attorney 
Mandelman 
provided 
no 
information 
regarding 
his 
impending license suspension and failed to advise that $8,456.44 
of S.M.'s funds remained in Attorney Mandelman's trust account.  
S.M. had previously informed Attorney Mandelman that S.M. 
required surgery due to the spinal injuries suffered in the 
accident, but he lacked funds to cover the medical expense. 
¶11 In July 2006 S.M. and his wife filed a grievance with 
the OLR and a claim with the Wisconsin Lawyers' Fund for Client 
Protection regarding the $25,000 settlement check for which they 
had received no accounting.  Eventually, after hiring another 
attorney, S.M. received the $8,456.44 remaining in Attorney 
Mandelman's trust account.   
¶12 The referee concluded the S.M. client matter gave rise 
to three violations:   
• Count one:  By collecting the $1,250 fee without 
performing any work, Attorney Mandelman violated former 
No. 
2007AP2653-D   
 
6 
 
SCR 20:1.5(a),1 which requires that a lawyer's fee be 
reasonable.  
• Count two:  By failing to give S.M. a written settlement 
statement showing the actual or intended disbursements 
                                                 
1 Effective July 1, 2007, substantial changes were made to 
the Wisconsin Supreme Court Rules of Professional Conduct for 
Attorneys, SCR Chapter 20.  See S. Ct. Order 04-07, 2007 WI 4, 
293 Wis. 2d xv, 726 N.W.2d Ct.R-45 (eff. July 1, 2007); and 
S. Ct. 
Order 
06-04, 
2007 
WI 
48, 
297 
Wis. 2d xv, 
730 
N.W.2d Ct.R.-29 (eff. July 1, 2007).  Because the conduct 
underlying this case arose prior to July 1, 2007, unless 
otherwise indicated, all references to the Wisconsin Supreme 
Court Rules will be to those in effect prior to July 1, 2007. 
Former SCR 20:1.5(a) provided as follows: 
 
A lawyer's fees shall be reasonable. The factors 
to be considered in determining the reasonableness of 
a fee include the following: 
 
(1) the time and labor required, the novelty and 
difficulty of the questions involved, and the skill 
required to perform the legal service properly; 
 
(2) the likelihood, if apparent to the client, 
that the acceptance of the particular employment will 
preclude other employment by the lawyer; 
 
(3) the fee customarily charged in the locality 
for similar legal services; 
 
(4) the amount involved and the results obtained; 
 
(5) the time limitations imposed by the client or 
by the circumstances;  
 
(6) the nature and length of the professional 
relationship with the client; 
 
(7) the experience, reputation, and ability of 
the lawyer or lawyers performing the services; and 
 
(8) whether the fee is fixed or contingent. 
No. 
2007AP2653-D   
 
7 
 
for the $25,000 settlement and retaining $8,456.44 for 
more than four years, Attorney Mandelman violated former 
SCR 20:1.15(b)2 and former SCR 20:1.15(d),3 which require 
                                                 
2 Former SCR 20:1.15(b) (2003-04) provided:   
 
Upon receiving funds or other property in which a 
client or third person has an interest, a lawyer shall 
promptly notify the client or third person in writing.  
Except as stated in this rule or otherwise permitted 
by law or by agreement with the client, a lawyer shall 
promptly deliver to the client or third person any 
funds or other property that the client or third 
person is entitled to receive and, upon request by the 
client or third person, shall render a full accounting 
regarding such property. 
3 Former SCR 20:1.15(d) (effective July 1, 2004, through 
June 30, 2007) provided: Prompt notice and delivery of property. 
(1) Notice and disbursement.  Upon receiving 
funds or other property in which a client has an 
interest, or in which the lawyer has received notice 
that a 3rd party has an interest identified by a lien, 
court order, judgment, or contract, the lawyer shall 
promptly notify the client or 3rd party in writing.  
Except as stated in this rule or otherwise permitted 
by law or by agreement with the client, the lawyer 
shall promptly deliver to the client or 3rd party any 
funds or other property that the client or 3rd party 
is entitled to receive. 
(2) Accounting.  Upon final distribution of any 
trust property or upon request by the client or a 3rd 
party having an ownership interest in the property, 
the lawyer shall promptly render a full written 
accounting regarding the property. 
(3) Disputes regarding trust property.  When the 
lawyer and another person or the client and another 
person claim ownership interest in trust property 
identified by a lien, court order, judgment or 
contract, the lawyer shall hold that property in trust 
until there is an accounting and severance of the 
interests.  If a dispute arises regarding the division 
No. 
2007AP2653-D   
 
8 
 
prompt disbursement of client funds and full accounting 
upon request; and  
• Count three:  By failing to discuss S.M.'s case and by 
advising that he had been diligently working on his case 
when in fact he had not, Attorney Mandelman violated SCR 
20:1.4(b),4 which requires a lawyer to explain a matter 
to the extent reasonably necessary to permit the client 
to make informed decisions.   
¶13 The referee also found restitution of $1,250 was owed 
to S.M.   
II.  THE DR. G.D. MATTER (COUNT 4) 
¶14 Dr. G.D. is a chiropractor to whom Attorney Mandelman 
referred personal injury clients for treatment.  In 15 client 
cases, Attorney Mandelman (or in one case, his law partner) 
entered into a doctor's lien in which the law firm and the 
client agreed to pay for Dr. G.D.'s chiropractic services from 
the client's settlement proceeds.  In each of the 15 cases, 
Attorney Mandelman obtained a settlement on behalf of the 
client, but failed to send Dr. G.D. written notice when the 
settlement proceeds were received and deposited in Attorney 
Mandelman's firm trust account.   
                                                                                                                                                             
of the property, the lawyer shall hold the disputed 
portion in trust until the dispute is resolved.  
Disputes between the lawyer and a client are subject 
to the provisions of sub. (g)(2). 
4 SCR 20:1.4(b) provides a lawyer shall "explain a matter to 
the extent reasonably necessary to permit the client to make 
informed decisions regarding the representation." 
No. 
2007AP2653-D   
 
9 
 
¶15 Three cases are representative.  For example, in one 
instance involving client P.D., the firm received a $10,000 
settlement in April 1999.  Dr. G.D. was owed $2,211.72.  Only 
$426.75 was retained in the firm's trust account, which remained 
on deposit for seven years without payment to Dr. G.D.  In 
another case involving client A.R., Dr. G.D. was owed $977.40.  
A $10,000 settlement check was received and, after payment of 
Attorney Mandelman's legal fees, the balance of the proceeds was 
paid to the client without satisfying Dr. G.D.'s lien. 
¶16 In a third case involving client B.S., the firm 
received a $23,000 settlement check in February 2001.  Dr. 
G.D.'s bill showed he was owed approximately $3,400 at that 
time.  Attorney Mandelman's firm, however, referred to Dr. 
G.D.'s 1999 statement that had been prepared before the receipt 
of several insurance payments.  The 1999 statement showed an 
incorrect $6,616.88 balance due to Dr. G.D.  Attorney Mandelman 
provided B.S. with an incorrect settlement statement showing Dr. 
G.D.'s lien to be $6,616.88 when in fact it was approximately 
$3,400.   
¶17 The firm distributed $14,282.12, leaving $8,717.88 on 
deposit from the settlement.  The $8,717.88 was retained in the 
firm's trust account for approximately ten months without 
payment to Dr. G.D.  On December 7, 2001, the firm prepared a 
$5,600 trust account check made out to Dr. G.D. and sent it to a 
collection agency, in anticipation that the collection agency 
would convince the doctor to accept the check in full payment of 
his lien.  The check was endorsed and cashed by the collection 
No. 
2007AP2653-D   
 
10 
 
agency, but Dr. G.D. denies receiving the funds.  On June 12, 
2002, the firm sent B.S. $3,177.88, reflecting the balance of 
his settlement.   
¶18 In July 2002 Dr. G.D. sued B.S. in small claims court 
and obtained a $3,589.04 default judgment against him.  Attorney 
Mandelman has admitted that his or his law firm's settlement 
with the collection agency and Dr. G.D. was to B.S.'s financial 
detriment in the amount of $2,200 and was not done by reason of 
any fault on the part of B.S.  The referee recommended 
restitution of $2,200 to B.S. 
III. THE D.K. CLIENT MATTER (COUNTS 5 AND 6) 
¶19 In the final matter, D.K. suffered injuries in two 
separate traffic accidents.  First, as a pedestrian in a 
crosswalk, D.K. was hit by a truck and suffered injuries.  
Several months later, before her first case was resolved, D.K. 
was again injured in a separate automobile accident.  D.K. 
retained Attorney Timothy Geary and Attorney Mandelman, both of 
whom agreed to serve as co-counsel on the two cases.   
¶20 In April 2005, with respect to the first accident, a 
$145,000 settlement check was sent to Attorney Mandelman's firm.  
He did not obtain D.K.'s endorsement and did not deposit the 
check into his trust account until August 1, 2005.  
¶21 Although Attorney Mandelman had agreed to provide 
updated notices to Medicare on D.K.'s behalf, he failed to do so 
timely.  He also failed to pay the subrogated Medicare lien and 
the assessed interest in a timely fashion.  D.K. had requested 
the return of certain items from her file and Attorney Mandelman 
No. 
2007AP2653-D   
 
11 
 
promised to do so within 24 hours, but he failed to return them.  
This misconduct gave rise to count five, charging a violation of 
SCR 20:1.3,5 which requires a lawyer to act with reasonable 
diligence and promptness.   
¶22 In addition, Attorney Mandelman failed to pay D.K. 
$100 that had been left in his trust account for more than four 
months after he was discharged as her attorney, and two and one-
half months after his license suspension.  This misconduct gave 
rise to count six, former SCR 20:1.15(d)(1), which requires a 
lawyer to notify a client promptly when he receives funds in 
which a client has an interest and promptly deliver the funds 
absent an agreement or legal requirement to do otherwise.   
¶23 Upon the parties' stipulation, the referee accepted 
the 
disciplinary complaint's allegations to establish the 
factual basis for the counts charged.  Attorney Mandelman and 
the OLR jointly recommended a sanction consisting of a one-year 
suspension 
of 
Attorney 
Mandelman's 
law 
license 
effective 
April 1, 2007, which is when Attorney Mandelman could have been 
eligible for reinstatement following his one-year suspension in 
2006.  Attorney Mandelman also stipulated to bear the costs of 
this disciplinary proceeding and pay restitution to clients S.M. 
and 
B.S. 
 
The 
referee 
accepted 
the 
parties' 
stipulated 
recommendation for the sanction, costs, and restitution.6  
                                                 
5 SCR 20:1.3 provides, "[a] lawyer shall act with reasonable 
diligence and promptness in representing a client."   
6 On November 17, 2008, the OLR filed a statement seeking 
$6,397.54 in costs.  
No. 
2007AP2653-D   
 
12 
 
¶24 No appeal has been filed.  This court reviews the 
matter according to the provisions of SCR 22.17(2).7  We approve 
and adopt the referee's findings and conclusions regarding 
Attorney 
Mandelman's 
misconduct. 
 
Also, 
we 
conclude 
the 
seriousness of Attorney Mandelman's professional misconduct 
warrants license suspension of one year.  We depart, however, 
from the referee's recommendation that the suspension should be 
retroactive to April 1, 2007.  The court will impose whatever 
sanction it determines is appropriate to achieve the goals of 
lawyer discipline, regardless of the referee's recommendation.  
In re Disciplinary Proceedings Against Widule, 2003 WI 34, ¶44, 
261 Wis. 2d 45, 660 N.W.2d 686. 
¶25 In response to this court's order, the parties filed 
memoranda addressing the question of discipline.  The OLR argues 
a one-year suspension is appropriate in view of numerous cases 
involving 
similar 
misconduct. 
 
See, 
for 
example, 
In 
re 
Disciplinary Proceedings Against Kalal, 2005 WI 138, 286 
Wis. 2d 10, 704 N.W.2d 575; In re Disciplinary Proceedings 
                                                 
7 SCR 22.17(2) provides:  
If no appeal is filed timely, the supreme court 
shall review the referee's report; adopt, reject or 
modify the referee's findings and conclusions or 
remand the matter to the referee for additional 
findings; 
and 
determine 
and 
impose 
appropriate 
discipline.  The court, on its own motion, may order 
the parties to file briefs in the matter.   
The parties have filed memoranda agreeing that because 
their stipulation was filed after the disciplinary complaint and 
has been approved by a referee, this matter does not proceed 
under SCR 22.12. 
No. 
2007AP2653-D   
 
13 
 
Against Archie, 205 Wis. 2d 122, 555 N.W.2d 378 (1996).  The OLR 
observes that little of the misconduct post-dated the most 
recent suspension, and nine months suspension resulting from 
Attorney Mandelman's 2006 discipline together with an additional 
12 months would be sufficient.  The OLR contends that while 
retroactive suspensions are not commonplace, they do not lack 
precedent.  See In re Disciplinary Proceedings Against Gilbert, 
2004 WI 144, 276 Wis. 2d 395, 689 N.W.2d 50.   
¶26 Attorney 
Mandelman 
contends 
a 
one-year 
license 
suspension retroactive to April 1, 2007, would be appropriate.  
He says he has taken responsibility for his misconduct by 
stipulating to all of the complaint's fact allegations as well 
as stipulating to the duration of the discipline sought by the 
OLR.  He notes he had the option of seeking reinstatement but 
instead sought to resolve this matter before proceeding.  Thus, 
he contends, a retroactive suspension would properly take into 
account all those factors.8   
¶27 We 
acknowledge 
Attorney 
Mandelman 
has 
accepted 
responsibility for his misconduct.  We conclude, nevertheless, 
the mitigating effect of his acceptance of responsibility must 
be viewed in relation to his extensive disciplinary history, 
along with the number of counts and the nature of his 
misconduct.  In view of these significantly aggravating factors, 
                                                 
8 The 
parties 
also 
addressed 
continuing 
education 
requirements and supervision of Attorney Mandelman's practice.  
We agree with the OLR that those matters are properly considered 
in connection with reinstatement proceedings.  
No. 
2007AP2653-D   
 
14 
 
we conclude that a retroactive suspension fails to achieve the 
goals of legal discipline.  Accordingly, the one-year license 
suspension shall be effective the date of this order. 
¶28 IT IS ORDERED that the license of Michael D. Mandelman 
to practice law in Wisconsin is suspended for a period of one 
year, effective the date of this order. 
¶29 IT IS FURTHER ORDERED that to the extent he has not 
yet done so, Michael D. Mandelman shall comply with SCR 22.26 
regarding the duties of a person whose license to practice law 
in Wisconsin has been suspended.  
¶30 IT IS FURTHER ORDERED that Michael D. Mandelman pay 
restitution as determined in the referee's report.  If the 
restitution is not paid within 60 days of this order, Michael D. 
Mandelman's license to practice law in Wisconsin shall remain 
suspended until further order of the court. 
¶31 IT IS FURTHER ORDERED that within 90 days of the date 
of this order Michael D. Mandelman pay to the Office of Lawyer 
Regulation the costs of this proceeding.  If 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, Michael D. 
Mandelman's license to practice law in Wisconsin shall remain 
suspended until further order of the court. 
 
No. 
2007AP2653-D   
 
 
 
1