2016 WI 75

SUPREME COURT OF WISCONSIN

CASE NO.: 2016AP101-D

COMPLETE TITLE: In the Matter of Disciplinary Proceedings 

Against Matthew H. Marx, Attorney at Law:

Office of Lawyer Regulation,

 Complainant,

 v.

Matthew H. Marx,

 Respondent.

DISCIPLINARY PROCEEDINGS AGAINST MARX

OPINION FILED: July 22, 2016

SUBMITTED ON BRIEFS: 

ORAL ARGUMENT:

SOURCE OF APPEAL:

COURT:

COUNTY:

JUDGE:

JUSTICES:

CONCURRED:

DISSENTED:

NOT PARTICIPATING: 

ATTORNEYS:
2016 WI 75

NOTICE

This opinion is subject to further 

editing and modification. The final 

version will appear in the bound 

volume of the official reports. 

No. 2016AP101-D

STATE OF WISCONSIN : IN SUPREME COURT

In the Matter of Disciplinary Proceedings 

Against Matthew H. Marx, Attorney at Law:

Office of Lawyer Regulation,

 Complainant,

 v.

Matthew H. Marx,

 Respondent.

FILED

JUL 22, 2016

Diane M. Fremgen

Clerk of Supreme Court

ATTORNEY disciplinary proceeding. Attorney's license 

suspended. 

¶1 PER CURIAM. We review a stipulation, as revised, 

filed pursuant to Supreme Court Rule (SCR) 22.12 by the Office 

of Lawyer Regulation (OLR) and Attorney Matthew H. Marx. 

Attorney Marx stipulates to the misconduct alleged by the OLR, 

stipulates, further, that he should be ordered to pay 

restitution to two clients and that his license to practice law 

in Wisconsin should be suspended for nine months.
No. 2016AP101-D 

2

¶2 We adopt the stipulated facts and conclusions of law. 

We agree that Attorney Marx's professional misconduct warrants 

the suspension of his Wisconsin law license for a period of nine 

months. We further agree that restitution is appropriate. 

Because this matter was resolved by stipulation without 

appointment of a referee, we will not impose the costs of this 

proceeding upon Attorney Marx. 

¶3 Attorney Marx was admitted to the practice of law in 

Wisconsin in 1996. Although he has not previously been 

disciplined by this court, Attorney Marx's license is

administratively suspended for failing to pay State Bar dues and

for failing to maintain his CLE requirements. In addition, his 

law license has been temporarily suspended since March 18, 2014

for noncooperation with the OLR's investigation into this 

matter.

¶4 On January 13, 2016, OLR filed a disciplinary

complaint against Attorney Marx alleging 22 counts of 

misconduct. The first seven counts of the OLR's complaint 

alleged, and the parties have stipulated, that Attorney Marx 

violated various provisions of SCR 20:1.15, the trust account 

rule.1 He violated SCR 20:1.15(b)(1)2 and/or SCR 20:1.15(b)(3)3

 

1 Effective July 1, 2016, substantial changes were made to 

Supreme Court Rule 20:1.15, the "trust account rule." See S. 

Ct. Order 14-07, (issued Apr. 4, 2016, eff. July 1, 2016). 

Because the conduct underlying this case arose prior to July 1, 

2016, unless otherwise indicated, all references to the supreme 

court rules will be to those in effect prior to July 1, 2016.

2 20:1.15(b)(1) provides: 

(continued)
No. 2016AP101-D 

3

by paying from his trust account $2,102.03 in personal and 

business expenses; $215 in filing fees for a client who had no 

funds in trust; and at least $301.33 in credit card surcharges. 

He violated SCR 20:1.15(b)(3)3 when he deposited and retained 

$3,800 in personal funds in his trust account. He violated SCR 

20:1.15(f)(1)a., b., and g.4 by failing to maintain a transaction 

 

A lawyer shall hold in trust, separate from the 

lawyer's own property, that property of clients and 

3rd parties that is in the lawyer's possession in 

connection with a representation. All funds of clients 

and 3rd parties paid to a lawyer or law firm in 

connection with a representation shall be deposited in 

one or more identifiable trust accounts. 

3 SCR 20:l:15(b)(3) provides: "No funds belonging to the 

lawyer or law firm, except funds reasonably sufficient to pay 

monthly account service charges may be deposited or retained in 

a trust account."

4 SCR 20:1.15(f)(l)a., b., and g. provide: 

Complete records of a trust account that is a 

draft account shall include a transaction register; 

individual client ledgers for IOLTA accounts and other 

pooled trust accounts; a ledger for account fees and 

charges, if law firm funds are held in the account 

pursuant to sub. (b)(3); deposit records; disbursement 

records; monthly statements; and reconciliation 

reports, subject to all of the following:

a. Transaction register. The transaction register 

shall contain a chronological record of all account

transactions, and shall include all of the following:

1. the date, source, and amount of all deposits;

2. the date, check or transaction number, payee 

and amount of all disbursements, whether by check, 

wire transfer, or other means;

(continued)
No. 2016AP101-D 

4

 

3. the date and amount of every other deposit or 

deduction of whatever nature;

4. the identity of the client for whom funds were 

deposited or disbursed; and

5. the balance in the account after each 

transaction. 

b. Individual client ledgers. A subsidiary ledger 

shall be maintained for each client or 3rd party for 

whom the lawyer receives trust funds that are 

deposited in an IOLTA account or any other pooled 

trust account. The lawyer shall record each receipt 

and disbursement of a client's or 3rd party's funds 

and the balance following each transaction. A lawyer 

shall not disburse funds from an IOLTA account or any 

pooled trust account that would create a negative 

balance with respect to any individual client or 

matter. . . .

g. Reconciliation reports. For each trust 

account, the lawyer shall prepare and retain a printed

reconciliation report on a regular and periodic basis 

not less frequently than every 30 days. Each

reconciliation report shall show all of the following 

balances and verify that they are identical:

1. the balance that appears in the transaction 

register as of the reporting date;

2. the total of all subsidiary ledger balances 

for IOLTA accounts and other pooled trust accounts,

determined by listing and totaling the balances in the 

individual client ledgers and the ledger for account 

fees and charges, as of the reporting date; and

3. the adjusted balance, determined by adding 

outstanding deposits and other credits to the balance 

in the financial institution's monthly statement and 

subtracting outstanding checks and other deductions 

from the balance in the monthly statement.
No. 2016AP101-D 

5

register and client ledgers, and violated SCR 20:1.15(e)(7)5 by 

failing to produce a transaction register, client ledgers, and a 

monthly reconciliation. Attorney Marx also violated SCR 

20:1.15(e)(4)e.

6 by authorizing credit card and other electronic 

payments be deposited into his trust account, and violated SCR 

20:1.15(e)(4)c.

7 by making internet deposits and disbursements 

from his trust account.

¶5 Counts 8 and 9 of the complaint allege and the parties 

have stipulated that Attorney Marx committed misconduct in his 

representation of D.A. in her divorce action. Attorney Marx 

failed to hold D.A.’s funds in trust in violation of SCR 

20:1.15(b) and then failed to cooperate with the investigation 

 

5 SCR 20:1.15(e)(7) provides: "All trust account records 

have public aspects related to a lawyer's fitness to practice. 

Upon request of the office of lawyer regulation, or upon 

direction of the supreme court, the records shall be submitted 

to the office of lawyer regulation for its inspection, audit, 

use, and evidence under any conditions to protect the privilege 

of clients that the court may provide. The records, or an audit 

of the records, shall be produced at any disciplinary proceeding 

involving the lawyer, whenever material. Failure to produce the

records constitutes unprofessional conduct and grounds for 

disciplinary action."

6 SCR 20:l.15(e)(4)e provides: "A lawyer shall not authorize 

transactions by way of credit card to or from a trust account. 

However, earned fees may be deposited by way of credit card to a 

lawyer's business account."

7 SCR 20:l.15(e)(4)c provides: "A lawyer shall not make 

deposits to or disbursements from a trust account by way of an 

Internet transaction."
No. 2016AP101-D 

6

of this matter, in violation of SCR 22.03(2)8 and SCR 22.03(6),9

enforced via SCR 20:8.4(h).10 

¶6 Counts 10-16 of the complaint allege, and the parties 

have stipulated, that Attorney Marx also committed misconduct in 

his representation of C.W. in a divorce. Attorney Marx violated 

SCR 20:1.15(e)(4)h.11 by allowing the deposit of C.W.’s credit 

 

8 SCR 22.03(2) provides:

Upon commencing an investigation, the director shall 

notify the respondent of the matter being investigated 

unless in the opinion of the director the 

investigation of the matter requires otherwise. The 

respondent shall fully and fairly disclose all facts 

and circumstances pertaining to the alleged misconduct 

within 20 days after being served by ordinary mail 

request for a written response. The director may 

allow additional time to respond. Following receipt 

of the response, the director may conduct further 

investigation and may compel the respondent to answer 

questions, furnish documents, and present any 

information deemed relevant to the investigation.

9 SCR 22.03(6) provides: "In the course of the 

investigation, the respondent's wilful failure to provide 

relevant information, to answer questions fully, or to furnish 

documents and the respondent's misrepresentation in a disclosure 

are misconduct, regardless of the merits of the matters asserted 

in the grievance." 

10 SCR 20:8.4(h) provides: "It is professional misconduct 

for a lawyer to: . . . . fail to cooperate in the investigation 

of a grievance filed with the office of lawyer regulation as 

required by SCR 21.15(4), SCR 22.001(9)(b), SCR 22.03(6), or SCR 

22.04(1)."

11 SCR 20:1.15(e)(4)h. provides:

(continued)
No. 2016AP101-D 

7

 

Exception: Fee and cost advances by credit card, 

debit card or other electronic deposit. A lawyer may 

establish a trust account, separate from the lawyer's 

IOLTA account, for the purpose of receiving legal fees 

and costs by credit card, debit card or other 

electronic deposit, provided that the lawyer complies 

with all of the following:

1. the separate trust account shall be entitled: 

"Credit Card Trust Account";

2. lawyer or law firm funds, reasonably 

sufficient to cover all monthly account fees and 

charges and, if necessary, any deductions by the 

financial institution or card issuer from a client's 

payment by credit card, debit card, or other 

electronic deposit, shall be maintained in the credit 

card trust account, and a ledger for account fees and 

charges shall be maintained; 

3. each payment of legal fees or costs by credit 

card, debit card or other electronic deposit, 

including, if necessary, a reimbursement by the lawyer 

or law firm for any deduction by the financial 

institution or card issuer from the gross amount of 

each payment, shall be transferred from the credit 

card trust account to the IOLTA account immediately 

upon becoming available for disbursement subject to 

the following requirements. 

a. All advanced costs and advanced fees held in 

trust under sub. (b)(4) shall be transferred by check 

to the IOLTA account. 

b. Earned fees, cost reimbursements, and 

advanced fees that are subject to the requirements of 

sub. (b)(4m) shall be transferred by check into the 

business account. 

(continued)
No. 2016AP101-D 

8

card payment into his client trust account. He violated SCR 

20:1.15(g)(1)12 by failing to provide C.W., in writing, at least 

five business days prior to withdrawing his funds for payment of 

fees, (a) an itemized bill or other accounting showing services 

rendered, (b) notice of the amount owed and anticipated date of 

withdrawal, and (c) a statement of the balance of his funds in 

 

4. within 3 business days of receiving actual 

notice that a chargeback or surcharge has been made 

against the credit card trust account, the lawyer 

shall replace any and all funds that have been 

withdrawn from the credit card trust account by the 

financial institution or card issuer; and shall 

reimburse the account for any shortfall or negative 

balance caused by a chargeback or surcharge. The 

lawyer shall not accept new payments to the credit 

card trust account until the lawyer has reimbursed the 

credit card trust account for the chargeback or 

surcharge. 

12 SCR 20:1.15(g)(1) provides: 

Withdrawal of non-contingent fees from trust 

account. 

(1) Notice to client. At least 5 business days 

before the date on which a disbursement is made from a 

trust account for the purpose of paying fees, with the 

exception of contingent fees or fees paid pursuant to 

court order, the lawyer shall transmit to the client 

in writing all of the following:

a. an itemized bill or other accounting showing 

the services rendered;

b. notice of the amount owed and the anticipated 

date of the withdrawal; and 

c. a statement of the balance of the client's 

funds in the lawyer trust account after the 

withdrawal. 
No. 2016AP101-D 

9

the trust account following the withdrawal. He violated SCR 

20:1.4(a)(4)13 by failing to respond to C.W.’s telephone calls 

and emails requesting information and violated SCR 22.26(1)(a),14

enforced via SCR 20:8.4(f)15 by failing to notify C.W. by 

certified mail of the suspension of his license to practice law 

and his consequent inability to represent him further. 

Additionally, he violated SCR 20:1.16(d)16 by failing to refund 

unearned fees to C.W. upon termination of the representation and 

 

13 SCR 20:1.4(a)(4) provides in part: "A lawyer shall . . . 

promptly comply with reasonable requests by the client for 

information . . . .

14 SCR 22.26(l)(a) provides: "On or before the effective 

date of license suspension or revocation, an attorney whose 

license is suspended or revoked shall do all of the following: 

Notify by certified mail all clients being represented in 

pending matters of the suspension or revocation and of the 

attorney's consequent inability to act as an attorney following 

the effective date of the suspension or revocation."

15 20:8.4(f) provides: "It is professional misconduct for a 

lawyer to violate a statute, supreme court rule, supreme court

order or supreme court decision regulating the conduct of 

lawyers."

16 SCR 20:1.16(d) provides: 

Upon termination of representation, a lawyer shall 

take steps to the extent reasonably practicable to 

protect a client's interests, such as giving 

reasonable notice to the client, allowing time for 

employment of other counsel, surrendering papers and 

property to which the client is entitled and refunding 

any advance payment of fee or expense that has not 

been earned or incurred. The lawyer may retain papers 

relating to the client to the extent permitted by 

other law. 
No. 2016AP101-D 

10

violated SCR 20:8.4(c)17 by making misrepresentations to the OLR. 

He also violated SCR 22.03(2) and SCR 22.03(6), enforced via SCR 

20:8.4(h), by failing to respond to OLR's letters regarding C.W.

matter.

¶7 Counts 17-22 of the complaint allege, and the parties 

have stipulated, that Attorney Marx committed misconduct by 

violating the terms of his temporary license suspension. 

Specifically, he failed to report his license suspension to the 

U.S. District Court for the Eastern District of Wisconsin, 

thereby violating SCR 20:3.4(c)18 and SCR 22.26(1)(c),

19 enforced 

via SCR 20:8.4(f).

¶8 In addition, by failing to notify his client, J.L., of 

his suspension and her need to hire successor counsel, Attorney 

 

17 SCR 20:8.4(c) provides that it is professional misconduct 

for a lawyer to "engage in conduct involving dishonesty, fraud, 

deceit or misrepresentation."

18 SCR 20:3.4(c) provides: "A lawyer shall not: . . . . 

knowingly disobey an obligation under the rules of a tribunal, 

except for an open refusal based on an assertion that no valid 

obligation exists."

19 SCR 22.26(1)(c) provides: "On or before the effective 

date of license suspension or revocation, an attorney whose 

license is suspended or revoked shall do all of the following: 

. . . . (c) Promptly provide written notification to the court 

or administrative agency and the attorney for each party in a 

matter pending before a court or administrative agency of the 

suspension or revocation and of the attorney's consequent 

inability to act as an attorney following the effective date of 

the suspension or revocation. The notice shall identify the 

successor attorney of the attorney's client or, if there is none 

at the time notice is given, shall state the client's place of 

residence." 
No. 2016AP101-D 

11

Marx violated SCR 22.26(1)(a) and (b),20 enforced via SCR 

20:8.4(f), and, by continuing to represent J.L. and filing

numerous documents in support of the U.S. District Court case, 

Attorney Marx violated SCR 22.26(2),21 enforced via SCR 

20:8.4(f). 

¶9 In addition, by misrepresenting to OLR that he had 

notified all his active clients of his March 18, 2014 

suspension, when he continued to represent J.L., Attorney Marx 

violated SCR 20:8.4(c).

¶10 Finally, in failing to respond to OLR's letters sent 

January 23, 2015 and February 18, 2015, requesting a response to 

OLR's inquiry, Attorney Marx violated SCR 22.03(2) and (6), 

enforced via SCR 20:8.4(h). 

¶11 In late February 2016, the OLR and Attorney Marx 

executed a stipulation addressing the complaint. In addition to 

stipulating to the facts as set forth above, the parties 

 

20 SCR 22.26(l)(b) provides: (1) On or before the effective 

date of license suspension or revocation, an attorney whose 

license is suspended or revoked shall do all of the following: 

. . . . (b) Advise the clients to seek legal advice of their 

choice elsewhere. 

21 SCR 22.26(2) provides: "An attorney whose license to 

practice law is suspended or revoked or who is suspended from 

the practice of law may not engage in this state in the practice 

of law or in any law work activity customarily done by law 

students, law clerks, or other paralegal personnel, except that 

the attorney may engage in law related work in this state for a 

commercial employer itself not engaged in the practice of law.
No. 2016AP101-D 

12

stipulated to discipline in the form of a nine-month suspension 

of Attorney Marx's Wisconsin law license. The OLR filed a 

memorandum in support of the stipulation. The memorandum 

discusses attorney disciplinary cases that resulted in 

comparable suspensions for professional misconduct. The OLR 

deems analogous the matter of Disciplinary Proceedings Against 

Maynard, 2014 WI 13, 352 Wis. 2d 629, 845 N.W.2d 648.

¶12 Attorney Maynard's law license was suspended for one 

year for misconduct consisting of failing to notify his clients 

and the courts that his license was suspended, continuing to 

practice law while suspended, engaging in dishonesty, 

misrepresenting his license status to the court, making false

statements in his affidavit of compliance, continuing to use his 

letterhead and making false communications that he was permitted 

to practice in Wisconsin, and providing false information to OLR

during its investigation. See also Disciplinary Proceedings 

Against Wood, 2013 WI 11, Id., 345 Wis. 2d 279, 825 N.W.2d 473; 

Disciplinary Proceedings Against Scanlan, 2006 WI 38, 290 

Wis. 2d 30, 712 N.W.2d 877. The OLR advises the court that 

Attorney Marx's misconduct is much like Attorney Maynard's in 

that Attorney Marx failed to comply with SCR 22.26, made 

misrepresentations regarding his license status, and provided 

false information to OLR. 

¶13 This court reviewed the stipulation. Noting that the

stipulation did not provide for restitution, the court issued an 

order directing the parties to consider specific modifications 
No. 2016AP101-D 

13

to the stipulation to address whether the court should order

Attorney Marx to pay restitution to two clients, D.A. and C.W. 

¶14 On April 28, 2016, the parties filed a revised 

stipulation. The revised stipulation reiterated previous terms 

and also stipulated that the court should order Attorney Marx to 

pay restitution to D.A. in the amount of $994.50, reflecting the 

balance that remained in his trust account attributable to D.A. 

as of February 25, 2013. The parties further agreed that the 

court should order Attorney Marx to pay restitution to C.W. in 

the amount of $1,568, the amount that should be returned to C.W. 

after Attorney Marx's payment of the $198 filing fee and $500 

worth of work that Attorney Marx performed on C.W.'s case. 

¶15 The stipulation, as revised, provides that it is not 

the result of a plea bargain. Attorney Marx verifies that he 

fully understands the misconduct allegations, the ramifications 

if this court should impose the stipulated level of discipline, 

his right to contest the matter, and his right to consult with 

counsel. He further verifies that his entry into the stipulation 

was made knowingly and voluntarily, and that it represents his 

admission of all misconduct and his assent to the level and type 

of discipline sought by the OLR.

¶16 We adopt the stipulation, as revised, and the 

stipulated facts and conclusions of law, and impose the 

stipulated discipline. We agree that the seriousness of Attorney 

Marx's misconduct warrants the suspension of his Wisconsin law 

license for nine months and payment of restitution to D.A. and 

C.W. We agree that Attorney Marx's mismanagement of his trust 
No. 2016AP101-D 

14

account evidences a careless disregard for the basic 

requirements of segregating trust funds from personal funds and 

record keeping and that his misconduct was exacerbated by his 

apparent indifference to making restitution. In light of the 

stipulation, the OLR does not seek costs, so we do not impose 

costs.

¶17 IT IS ORDERED that the license of Matthew H. Marx to 

practice law in Wisconsin is suspended for a period of nine 

months, effective the date of this order. 

¶18 IT IS FURTHER ORDERED that Matthew H. Marx shall 

comply with the provisions of SCR 22.26 concerning the duties of 

a person whose license to practice law in Wisconsin has been 

suspended. 

¶19 IT IS FURTHER ORDERED that compliance with all 

conditions of this order is required for reinstatement. See SCR 

22.28(2). 

¶20 IT IS FURTHER ORDERED that the March 18, 2014

temporary suspension of Matthew H. Marx’s license to practice 

law in Wisconsin, due to his wilful failure to cooperate with 

the OLR's grievance investigation in this matter, is lifted. 

¶21 IT IS FURTHER ORDERED that the administrative 

suspension of Matthew H. Marx’s license to practice law in 

Wisconsin, due to his failure to pay mandatory bar dues and 

failure to comply with continuing legal education requirements, 

will remain in effect until each reason for the administrative 

suspension has been rectified, pursuant to SCR 22.28(1). 
No. 2016AP101-D 

15

¶22 IT IS FURTHER ORDERED that Matthew H. Marx shall pay 

restitution to D.A. in the amount of $994.50, and to C.W. in the 

amount of $1,568. 

¶23 IT IS FURTHER ORDERED that no costs are imposed in 

this matter.
No. 2016AP101-D 

1