Title: Office of Lawyer Regulation v. Shawn G. Rice
Citation: N/A
Docket Number: 2014AP002307-D
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: January 6, 2017

2017 WI 1 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2014AP2307-D 
COMPLETE TITLE: 
In the Matter of Disciplinary Proceedings 
Against Shawn G. Rice, Attorney at Law: 
 
Office of Lawyer Regulation, 
          Complainant, 
     v. 
Shawn G. Rice, 
          Respondent. 
 
 
 
 
DISCIPLINARY PROCEEDINGS AGAINST RICE 
 
 
OPINION FILED: 
January 6, 2017 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
      
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
      
 
COUNTY: 
      
 
JUDGE: 
      
 
 
 
JUSTICES: 
 
 
CONCURRED: 
 
 
DISSENTED: 
ABRAHAMSON, S. J., joined by BRADLEY, A. W. J., 
dissent (Opinion filed). 
 
NOT PARTICIPATING:          
 
 
 
ATTORNEYS: 
 
 
 
 
 
 
 
 
 
2017 WI 1
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2014AP2307-D 
 
 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
In the Matter of Disciplinary Proceedings 
Against Shawn G. Rice, Attorney at Law: 
 
 
Office of Lawyer Regulation, 
 
          Complainant, 
 
     v. 
 
Shawn G. Rice, 
 
          Respondent. 
 
FILED 
 
JAN 6, 2017 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
ATTORNEY 
disciplinary 
proceeding.   Attorney's 
license 
suspended.   
 
¶1 
PER 
CURIAM.   We 
review 
the 
report 
of 
Referee 
Christine Harris Taylor, concluding that Attorney Shawn G. Rice 
committed one count of professional misconduct as alleged in the 
Office of Lawyer Regulation's (OLR) complaint.  Referee Taylor 
recommends the court suspend Attorney Rice's license for a 
period of 60 days and that we order Attorney Rice to pay the 
full costs of this disciplinary proceeding.  
No. 
2014AP2307-D   
 
2 
 
¶2 
No appeal was filed from the referee's report so we 
review this matter pursuant to SCR 22.17(2).1  After completing 
our review, we agree that the stipulated facts and the record 
are sufficient to establish that Attorney Rice violated SCR 
20:8.4(c).2  We further agree that Attorney Rice's license should 
be suspended for 60 days.  We accede to the OLR's conclusion 
that restitution is not warranted.  We deny Attorney Rice's 
objection to costs and direct him to pay the full costs of this 
disciplinary proceeding which are $14,064.72 as of August 29, 
2016. 
¶3 
Attorney 
Rice 
was 
admitted 
to 
practice 
law 
in 
Wisconsin in 1993.  He has been subject to professional 
discipline on one prior occasion.  In 2007, he received a public 
reprimand for three counts of professional misconduct related to 
his personal involvement in a commercial real estate transaction 
in which he made false statements in a deposition and executed a 
document falsely reflecting an individual as a member of an LLC. 
                                                 
1 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. 
2 SCR 20:8.4(c) provides:  "It is professional misconduct 
for a lawyer to:  . . . engage in conduct involving dishonesty, 
fraud, deceit or misrepresentation." 
No. 
2014AP2307-D   
 
3 
 
In re Disciplinary Proceedings Against Rice, 2007 WI 68, 301 
Wis. 2d 94, 732 N.W.2d 440. 
¶4 
This matter came to the OLR's attention during Rice's 
acrimonious divorce proceeding.  In 1996, Attorney Rice and Ms. 
Liesl M. Testwuide (Ms. Testwuide) were married.  In 1992, when 
Ms. Testwuide was still unmarried and childless, Ms. Testwuide's 
parents created a trust for the benefit of Ms. Testwuide and her 
children. Ms. Testwuide was co-trustee of the trust along with 
Kenneth Kazmierczak, a business associate of Ms. Testwuide's 
father.  
¶5 
In 2010, Ms. Testwuide filed for divorce.  In July 
2011, while the divorce was pending, Ms. Testwuide filed a 
grievance with the OLR alleging that Attorney Rice had removed 
over $600,000 from the trust without proper authorization by 
forging Ms. Testwuide's signature and the signature of her co-
trustee.  Attorney Rice self-reported the same misconduct and, 
in October 2011, Attorney Rice submitted a lengthy written 
response to the grievance acknowledging that he signed documents 
without proper authorization but asserting Ms. Testwuide knew 
and tacitly approved his actions.  Ms. Testwuide and Attorney 
Rice's divorce judgment was entered in October 2011; they 
continued to litigate custody, placement, and other issues.   
¶6 
On November 21, 2011, Ms. Testwuide filed a civil 
action against Attorney Rice and his former law firm, alleging 
fraud, conversion, and legal malpractice. Testwuide v. Rice, 
2011CV1184, Sheboygan County.  On December 18, 2012, the circuit 
court granted Rice's motion for summary judgment, ruling that 
No. 
2014AP2307-D   
 
4 
 
several claims were barred by the statute of limitations.  In 
May 2013, a stipulation and order dismissing the remaining 
claims against Rice was entered.  
¶7 
On October 2, 2014, the OLR filed a disciplinary 
complaint alleging that Attorney Rice violated SCR 20:8.4(c) by 
forging the signatures of the co-trustees of the Liesl M. 
Testwuide 
1992 
Trust 
on 
various 
checks 
and 
documents.  
Initially, the OLR sought a six month license suspension. In 
July 2015, after pretrial discovery, the OLR and Attorney Rice 
executed a "Stipulation Regarding Factual Allegations and 
Disciplinary Charge."  Attorney Rice admitted that he violated 
SCR 20:8.4(c) by preparing and executing, without authorization, 
numerous forms, checks and other Trust documents for a 12-year 
period during the marriage and continuing until Ms. Testwuide 
filed for divorce in 2010.  
¶8 
The referee accepted the stipulation.  The parties 
continued to dispute the appropriate discipline and conducted 
additional discovery, including depositions.  
¶9 
Attorney 
Rice 
maintained 
that, 
under 
the 
circumstances, a public reprimand was sufficient.  On April 15, 
2016, days before a scheduled evidentiary hearing, the OLR 
reduced its recommendation from a six-month license suspension 
to a 60-day license suspension.  Attorney Rice continued to 
assert that a public reprimand was sufficient, but the parties 
agreed to waive the scheduled hearing and permit the referee to 
resolve the question of appropriate discipline based on the 
No. 
2014AP2307-D   
 
5 
 
stipulation, the existing record, and the parties' written 
submissions.   
¶10 The referee issued her report and recommendation dated 
August 9, 2016.  Neither party appealed. 
¶11 When we review a referee's report and recommendation 
in an attorney disciplinary case, we affirm the referee's 
findings of fact unless they are found to be clearly erroneous, 
but we review the referee's conclusions of law on a de novo 
basis.  In re Disciplinary Proceedings Against Inglimo, 2007 WI 
126, ¶5, 305 Wis. 2d 71, 740 N.W.2d 125. We determine the 
appropriate level of discipline to impose given the particular 
facts of each case, independent of the referee's recommendation, 
but benefiting from it.  In re Disciplinary Proceedings Against 
Widule, 2003 WI 34, ¶44, 261 Wis. 2d 45, 660 N.W.2d 686. 
¶12 There is no showing that the referee's factual 
findings are clearly erroneous and we accept them.  The 
complaint alleges, Attorney Rice has stipulated, and the record 
supports the finding that Attorney Rice arranged for numerous 
checks 
and 
disbursals 
from 
the 
trust 
account, 
without 
authorization, the aggregate amount of which was several hundred 
thousand dollars.3 
                                                 
3 We do not know how much money Rice transferred from the 
trust without proper authorization.  The OLR states that its 
"investigation did not and most probably could not have 
calculated the total amount involved in the transactions at 
issue."  See OLR's Restitution Statement at 1-2.  
No. 
2014AP2307-D   
 
6 
 
¶13 Supreme Court Rule 20:8.4(c) provides that it is 
professional misconduct for a lawyer to engage in conduct 
involving dishonesty, fraud, deceit, or misrepresentation.  The 
stipulation and the record before the court are sufficient to 
support a legal conclusion that Attorney Rice violated SCR 
20:8.4(c). 
¶14 The primary question in this matter is the appropriate 
discipline for Attorney Rice's misconduct.  Factors relevant to 
determining 
appropriate 
attorney 
discipline 
include 
the 
seriousness, nature and extent of the misconduct; the level of 
discipline needed to protect the public, the courts, and the 
legal system from repetition of the attorney's misconduct; the 
need to impress upon the attorney the seriousness of the 
misconduct; 
and 
the 
need 
to 
deter 
other 
attorneys 
from 
committing 
similar 
misconduct. 
 
See 
In 
re 
Disciplinary 
Proceedings Against Hammis, 2011 WI 3, ¶39, 331 Wis. 2d 19, 793 
N.W.2d 884; In re Disciplinary Proceedings Against Eisenberg, 
2004 WI 14, ¶5, 269 Wis. 2d 43, 675 N.W.2d 747. 
¶15 The 
referee 
identified 
as 
aggravating 
factors, 
Attorney Rice's prior discipline, a dishonest or selfish motive, 
and the fact that the misconduct spanned years.  As mitigating 
factors, the referee noted that Attorney Rice self-reported his 
misconduct and that he was cooperative in these proceedings.  
¶16 After 
itemizing 
a 
number 
of 
unauthorized 
trust 
transactions, the referee stated that she was not persuaded by 
Attorney Rice's claim that it was "impossible" to locate the co-
trustee after the co-trustee relocated to Minneapolis, and found 
No. 
2014AP2307-D   
 
7 
 
further that the "overwhelming information in this record 
supports the fact that [Rice's] misconduct in accessing Trust 
funds, without authorization was well in excess of any dollar 
amounts necessary to 'pay bills.'."  However, the referee 
acknowledged the "personal nature of the issues leading [Rice] 
to engage in the misconduct that he admits to" and found 
credible Attorney Rice's assertion that he sincerely believed 
that he was acting as a "de facto" trustee. 
¶17 Throughout 
these 
proceedings 
Attorney 
Rice 
has 
maintained that he engaged in the trust transactions, albeit 
unauthorized, but with the knowledge and consent of his wife, 
who was both a co-trustee and a beneficiary of the trust.  He 
claims that she did not want to be involved in the marital 
finances.  He maintains that the trust funds were used to 
support a marital lifestyle that exceeded their employment 
income, and paid for, among other things, property taxes, 
vacations, and the remodeling of a vacation home.  He claims 
that Ms. Testwuide's grievance was both selective and incomplete 
in terms of the trust transactions it identified. The referee 
did not make specific findings in this regard, however, merely 
noting the "conflicting" evidence provided.  There is no finding 
that Attorney Rice misused the trust funds. 
¶18 In terms of the appropriate discipline, the referee 
described Attorney Rice's misconduct as serious, but ultimately 
accepted the OLR's recommendation for a 60-day suspension.  She 
deemed 
analogous 
In 
re 
Disciplinary 
Proceedings 
Against 
Riegleman, 2003 WI 3, 259 Wis. 2d 1, 657 N.W.2d 339, in which 
No. 
2014AP2307-D   
 
8 
 
this court imposed a 60-day suspension upon a lawyer who 
endorsed a settlement check without the insurance company's 
consent, failed to inform the insurance company the lawyer was 
in possession of the funds, and distributed settlement funds 
despite knowing there was a dispute regarding the funds. See 
also In re Disciplinary Proceedings Against Glesner, 2000 WI 18, 
233 Wis. 2d 35, 606 N.W.2d 173 (imposing 60-day suspension for 
adding unearned charges to a client's billing and creating an 
invoice with fabricated time entries); In re Disciplinary 
Proceedings Against Krueger, 2006 WI 17, 288 Wis. 2d 586, 709 
N.W.2d 857 (imposing 60-day suspension for preparing and filing 
inaccurate bankruptcy schedules and failing to disclose a pre-
bankruptcy debt owed to him by the debtor of over $7,000).  The 
referee thus recommends the court suspend Attorney Rice's 
license for 60 days and further recommends that we impose the 
full costs of this proceeding on Attorney Rice.   
¶19 Attorney 
Rice 
filed 
an 
objection 
to 
the 
OLR's 
statement of costs.  He contends that he conceded all along that 
he committed the alleged misconduct but felt compelled to 
litigate the case because the OLR "overreached with respect to 
the punishment" it initially sought, namely, a six-month 
suspension.  He contends that he was effectively left with "no 
viable course of action other than fully litigating the case" as 
occurred in In re Disciplinary Proceedings Against Frisch, 2010 
WI 60, 326 Wis. 2d 128, 784 N.W.2d 670.  He points out that the 
OLR reduced its requested discipline to a 60-day suspension a 
mere two days before a scheduled hearing, whereupon he agreed to 
No. 
2014AP2307-D   
 
9 
 
have the referee consider the matter on written submissions.  He 
asks the court to impose only half the costs upon him.   
¶20 The OLR maintains that full costs are appropriate.  
The OLR reminds the court that Attorney Rice continued to seek a 
public reprimand; that is, he did not "acquiesce" when the OLR 
reduced the recommended sanction, nor did he stipulate to 
discipline.  The OLR maintains that its costs were incurred in 
the normal course of litigating this case.   
¶21 We agree.  We find no reason to depart from our 
general practice of imposing full costs on attorneys found to 
have committed misconduct.  See SCR 22.25.  While Attorney Rice 
did admit his misconduct and ultimately stipulated to certain 
facts, disagreement regarding the appropriate sanction resulted 
in the parties litigating this matter for some time and required 
the preparation of a referee's report.  
¶22 Finally, 
we impose no restitution obligation on 
Attorney Rice.  The OLR has not sought restitution and we accede 
to its determination that restitution is not appropriate in this 
case.  See SCR 21.16(1m)(em) and (2m)(a)1.  
¶23 IT IS ORDERED that the license of Shawn G. Rice to 
practice law in Wisconsin is suspended for a period of 60 days, 
effective February 17, 2017.  
¶24 IT IS FURTHER ORDERED that Shawn G. Rice 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. 
No. 
2014AP2307-D   
 
10 
 
¶25 IT IS FURTHER ORDERED that within 60 days of the date 
of this order, Shawn G. Rice shall pay to the Office of Lawyer 
Regulation the costs of this proceeding, which are $14,064.72 as 
of August 29, 2016.  
¶26 IT IS FURTHER ORDERED that compliance with all 
conditions of this order is required for reinstatement.  See SCR 
22.29(4)(c). 
No.  2014AP2307-D.ssa 
 
1 
 
 
¶27 SHIRLEY S. ABRAHAMSON, J.   (dissenting).  I cannot 
join this per curiam because the stipulation, the referee's 
report, and this per curiam do not make clear the nature and 
extent of Attorney Rice's conduct that is charged as a violation 
of SCR 20:8.4(c).  Without knowing the nature and extent of the 
conduct I cannot determine whether a violation of the Code 
occurred and, if there was a violation, the appropriate 
discipline.  Accordingly, I dissent. 
¶28 I am authorized to state that Justice ANN WALSH 
BRADLEY joins this dissent. 
 
No.  2014AP2307-D.ssa 
 
 
 
1