Court Opinion

ID: 2717366
Source: CourtListenerOpinion
Date Created: 2014-08-12 14:07:54.3539+00
Date Added: 2024-06-11T09:57:29.744003
License: Public Domain

2014 WI 104

                  SUPREME COURT           OF   WISCONSIN
CASE NO.:               1984AP970-D
COMPLETE TITLE:         In the Matter of Disciplinary Proceedings
                        Against John J. Balistrieri, Attorney at Law:

                        Office of Lawyer Regulation,
                                  Complainant,
                             v.
                        John J. Balistrieri,
                                  Respondent.

                          DISCIPLINARY PROCEEDINGS AGAINST BALISTRIERI

OPINION FILED:          August 12, 2014
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
   COURT:
   COUNTY:
   JUDGE:

JUSTICES:
   CONCURRED:
   DISSENTED:           BRADLEY, J., dissent. (Opinion filed.)
   NOT PARTICIPATING:   ROGGENSACK, J., withdrew from participation.

ATTORNEYS:
                                                                2014 WI 104
                                                         NOTICE
                                           This opinion is subject to further
                                           editing and modification.   The final
                                           version will appear in the bound
                                           volume of the official reports.
No.   1984AP970-D

STATE OF WISCONSIN                     :            IN SUPREME COURT

In the Matter of Disciplinary Proceedings
Against John J. Balistrieri, Attorney at Law:

Office of Lawyer Regulation,                                  FILED
           Complainant,
                                                         AUG 12, 2014
      v.
                                                            Diane M. Fremgen
                                                         Clerk of Supreme Court
John J. Balistrieri,

           Respondent.

      ATTORNEY reinstatement proceeding.     Reinstatement denied.

      ¶1   PER CURIAM.    We review the report and recommendation

of the referee, Attorney Richard C. Ninneman, that the license

of Attorney John J. Balistrieri to practice law in Wisconsin

should be reinstated.     Although the Office of Lawyer Regulation

(OLR) strenuously opposed Attorney Balistrieri's reinstatement

petition before the referee, it did not appeal the referee's

recommendation.     We therefore review the referee's report and
                                                                   No.    1984AP970-D

recommendation pursuant to Supreme Court Rule (SCR) 22.33(3).1

After fully reviewing this matter, we conclude that Attorney

Balistrieri has not satisfied the criteria required to resume

the practice of law in this state, and we therefore deny his

petition for reinstatement.               We also determine that Attorney

Balistrieri         should   be   required      to    pay   the   costs    of     this

reinstatement         proceeding,      which         were   $41,459.40       as    of

February 4, 2013.

      ¶2      The     standards    that       apply    to   all    petitions       for

reinstatement after a disciplinary suspension or revocation are

set   forth    in     SCR 22.31(1).2       In    particular,      the    petitioning

      1
       SCR 22.33(3) provides that "[i]f no appeal is timely
filed, the supreme court shall review the referee's report,
order   reinstatement,  with   or  without conditions, deny
reinstatement, or order the parties to file briefs in the
matter."
      2
          SCR 22.31(1) states:

           The petitioner has the burden of demonstrating,
      by clear, satisfactory, and convincing evidence, all
      of the following:

           (a) That he or she has the moral character to
      practice law in Wisconsin.

           (b) That his or her resumption of the practice of
      law will not be detrimental to the administration of
      justice or subversive of the public interest.

           (c) That his or her representations in the
      petition, including the representations required by
      SCR   22.29(4)(a)  to  [(4m)]   and   22.29(5), are
      substantiated.

                                                                         (continued)
                                          2
                                                                      No.   1984AP970-D

attorney must demonstrate by clear, satisfactory, and convincing

evidence that he or she has the moral character necessary to

practice law in this state, that his or her resumption of the

practice of law will not be detrimental to the administration of

justice    or    subversive     of    the    public      interest,    and   that     the

attorney has complied fully with the terms of the suspension or

revocation       order    and   the    requirements         of     SCR 22.26.         In

addition,       SCR 22.31(1)(c)      incorporates        the     statements    that    a

petition        for      reinstatement          must     contain       pursuant       to

SCR 22.29(4)(a)-[(4m)].3             Thus,      the    petitioning    attorney      must

          (d) That he or she has complied fully with the
     terms of the order of suspension or revocation and
     with the requirements of SCR 22.26.
     3
       SCR 22.29(4)(a) through (4m) provides that a petition for
reinstatement shall show all of the following:

          (a) The   petitioner    desires                   to       have     the
     petitioner's license reinstated.

          (b) The petitioner has not practiced law during
     the period of suspension or revocation.

          (c) The petitioner has complied fully with the
     terms of the order of suspension or revocation and
     will   continue  to   comply   with them  until the
     petitioner's license is reinstated.

          (d) The petitioner has maintained competence and
     learning in the law by attendance at identified
     educational activities.

          (e) The petitioner's conduct since the suspension
     or revocation has been exemplary and above reproach.

            (f) The petitioner has a proper understanding of
     and    attitude toward the standards that are imposed
                                                      (continued)
                                            3
                                                        No.   1984AP970-D

demonstrate     that   the    required   representations       in     the

reinstatement petition are substantiated.

    ¶3   When     reviewing   referee    reports   in    reinstatement

proceedings, we utilize standards of review similar to those we

use for reviewing referee reports in disciplinary proceedings.

We do not overturn a referee's findings of fact unless they are

clearly erroneous.     On the other hand, we review a referee's

legal conclusions, including whether the attorney has satisfied

the criteria for reinstatement, on a de novo basis.                 In re

    upon members of the bar and will act in conformity
    with the standards.

         (g) The petitioner can safely be recommended to
    the legal profession, the courts and the public as a
    person fit to be consulted by others and to represent
    them and otherwise act in matters of trust and
    confidence and in general to aid in the administration
    of justice as a member of the bar and as an officer of
    the courts.

         (h) The petitioner has fully complied with the
    requirements set forth in SCR 22.26.

         (j) The petitioner's proposed use of the license
    if reinstated.

         (k) A full description of all of the petitioner's
    business activities during the period of suspension or
    revocation.

         (4m) The petitioner has made restitution to or
    settled all claims of persons injured or harmed by
    petitioner's misconduct, including reimbursement to
    the Wisconsin lawyers' fund for client protection for
    all payments made from that fund, or, if not, the
    petitioner's explanation of the failure or inability
    to do so.

                                  4
                                                                         No.      1984AP970-D

Disciplinary       Proceedings     Against       Jennings,        2011 WI 45,    ¶39,

334 Wis. 2d 335, 801 N.W.2d 304; In re Disciplinary Proceedings

Against Gral, 2010 WI 14, ¶22, 323 Wis. 2d 280, 779 N.W.2d 168.

    ¶4      Attorney Balistrieri was admitted to practice law in

Wisconsin     in     August     1973,     following         his        graduation       from

Valparaiso University Law School.                 He and his brother, Joseph

Balistrieri      (Joseph),      subsequently       engaged        in    a    private     law

practice in Milwaukee.

    ¶5      In     1981   a     federal       grand     jury      indicted         Attorney

Balistrieri, along with his brother Joseph and his father Frank.4

Following    a     six-week     trial    in     1984,   a    jury       found      Attorney

Balistrieri      guilty    of     conspiracy       to       obstruct         commerce     by

extortion.       The conviction was affirmed by the United States

Court of Appeals for the Seventh Circuit.                          United States v.

Balistrieri,       778 F.2d 1226,       1228,    1232    (7th Cir.           1985).       The

referee   downplays       Attorney      Balistrieri's          role     in     the     crime,

laying most of the blame at the feet of his father Frank.                                 He

describes     the     facts     underlying        the    convictions              as    Frank
threatening an undercover FBI agent with physical violence for

starting a vending machine business in Milwaukee without his

permission and then forcing the undercover agent to give him a

hidden ownership interest in the new business.                                The referee

    4
       The referee describes Frank Balistrieri as "the reputed
head of the Mafia in Milwaukee" at that time. According to the
referee, the Shorecrest Hotel in Milwaukee, which was held in
ownership under Joseph Balistrieri's name, "allegedly was the
headquarters of the 'mob' in Wisconsin."

                                          5
                                                         No.   1984AP970-D

states that the role of Attorney Balistrieri and his brother

Joseph was limited to drafting the legal documents that gave

their   father   a   legally   enforceable   interest   in   the   vending

business.

    ¶6      In its decision on the direct appeal filed by the

Balistrieris, the United States Court of Appeals for the Seventh

Circuit did not so limit the role of the Balistrieri sons in its

description of the facts underlying the charges:

          The essential facts in this extortion scheme are
    that    between  May   1978    and   February   1979   the
    Balistrieris,    Ruggiero,     and    allegedly    SaBella
    conspired to extort sums of money and a one-half
    partnership interest in the Best Vending Company. FBI
    Agent Gail Cobb, using the alias Tony Conte, operated
    the Best Vending Company. Between 1976 and 1981, FBI
    Special Agent Joseph Pistone was operating under the
    alias    Donnie   Brasco    as    an   undercover    agent
    investigating organized crime activities in New York
    City. During this time he developed a close working
    relationship with Ruggiero, who described himself as a
    member of the Bonanno crime family of New York.
    Pistone mentioned to Ruggiero that Cobb had moved to
    Milwaukee and was trying to open a vending machine
    business there.

         Subsequently Ruggiero told Cobb that the vending
    business in Milwaukee was controlled by "the mob" and
    that Cobb could not enter that business without
    "protection" from the mob figures who controlled that
    business. After inducing Cobb to pay money to him,
    Ruggiero arranged for Cobb to meet with Frank
    Balistrieri, so that Cobb could obtain permission from
    Balistrieri to do business in Milwaukee.

         On July 29, 1978, Cobb had a meeting with Frank
    Balistrieri and others in Milwaukee during which Frank
    Balistrieri made threats against Cobb because Cobb had
    attempted to start a vending machine business in
    Milwaukee without his permission. Later, in the
    presence of John and Joseph Balistrieri, Frank

                                    6
                                                                   No.     1984AP970-D

       Balistrieri told Cobb that he was to             share his vending
       business with the Balistrieris. Cobb              agreed to permit
       the Balistrieris to become secret                 partners in his
       business, and the Balistrieris began             directing Cobb in
       his conduct of the business.
Balistrieri, 778 F.2d at 1228.

       ¶7     The    federal     district       court     initially         sentenced

Attorney Balistrieri to eight years of imprisonment and imposed

a $20,000 fine.5           The prison term was subsequently reduced to

five        years.         Attorney     Balistrieri           ultimately      served

approximately 39 months in a federal prison.                   He was released in
April 1989.

       ¶8     As a result of Attorney Balistrieri's conviction, this

court summarily suspended his license to practice law on June 6,

1984.       As shown by documents in this court's public files in the

original disciplinary proceeding, Attorney Balistrieri reached

an     agreement     with      the    Board     of   Attorneys        Professional

Responsibility (BAPR), the predecessor to the OLR, that he would

not    challenge     the    summary    suspension       and    that   the    summary

suspension would remain in effect while any direct appeal of his

conviction was still pending.                The agreement further provided

that if Attorney Balistrieri's conviction were affirmed, his law

license would be revoked at that time.                  Following the issuance

of the Seventh Circuit's decision affirming his conviction, this

court revoked Attorney Balistrieri's license to practice law in

       5
       Frank  Balistrieri   was               sentenced  to   13  years   of
imprisonment and fined $5,000.               Joseph Balistrieri received the
same sentence as his brother.

                                         7
                                                                 No.   1984AP970-D

this state on January 21, 1987, pursuant to his agreement with

BAPR.

     ¶9   Following       his    1989   release     from    prison,      Attorney

Balistrieri    returned    to    Milwaukee    to    live   and    work    at   the

Shorecrest Hotel (Shorecrest),6 where he served as the on-site

operations manager7 until his brother Joseph’s death in 2010,

when Attorney Balistrieri inherited ownership of the property

and took over sole control of the property and business.                  Within

a relatively short time after inheriting the hotel, Attorney

Balistrieri    sold   the       property     in    2011    for    approximately

$8 million.8    In addition, during the time that he worked for or

owned the property, Attorney Balistrieri owned and operated a

separate small business that offered laundry services at the

Shorecrest.
     6
       Attorney Balistrieri described the Shorecrest as primarily
a high-rise apartment complex that contained a few overnight
hotel rooms so that the hotel license could be maintained.
     7
       At   the  reinstatement  evidentiary   hearing,   Attorney
Balistrieri likened his brother's role in the Shorecrest to
being the chairman of the board, overseeing policy decisions,
while he fulfilled the role of chief operating officer.      More
specifically, Attorney Balistrieri testified that he oversaw the
daily operation of the property/business.     He supervised the
maintenance   department,   the  housekeeping   department,   the
administrative department, and the front desk.      He also was
responsible for maintaining the books and records of the
business. He stated that he was on call seven days a week and
365 days a year to handle issues that arose with the operation
of the property.
     8
       The referee notes that the sale of the Shorecrest was
designated as the 2011 outstanding business transaction of the
greater Milwaukee area by the Milwaukee edition of The Business
Journal.

                                        8
                                                                      No.   1984AP970-D

       ¶10    In 1995 Attorney Balistrieri filed a petition for the

reinstatement of his license to practice law.                     In the course of

that reinstatement proceeding, the then United States Attorney

for the Eastern District of Wisconsin, Thomas P. Schneider, the

then Wisconsin Attorney General, James E. Doyle, and the then

Milwaukee         County   District   Attorney,        E.    Michael     McCann,    all

submitted letters opposing Attorney Balistrieri's reinstatement

petition.           Ultimately,     after       an    evidentiary       reinstatement

hearing, BAPR recommended to this court that the petition be

denied, finding that Attorney Balistrieri had not met his burden

to prove that he had a proper understanding of and attitude

toward the standards imposed on lawyers and that he could not be

recommended as a person fit to act as an officer of the court.

       ¶11    Shortly       after     BAPR's          recommendation,          Attorney

Balistrieri attempted to withdraw his petition.                      In an affidavit

supporting his withdrawal request, he alleged that BAPR's report

and    recommendation          "clearly   demonstrate[d]         a      hostile    bias

against [Attorney Balistrieri] which affiant believes to be the
product      of    political    expedience      and    ethnic   prejudice      against

Italian-Americans in general and affiant in particular."                           The

court denied the request to withdraw, and after a period of

inactivity in the matter, dismissed the petition in March 2001.

       ¶12    In 2012 Attorney Balistrieri filed a second petition

for the reinstatement of his license to practice law in this

state.       The referee conducted a three-day reinstatement hearing,

at    which    14    witnesses    testified.          In    addition,    the   referee
received a substantial number of letters in support of Attorney
                                            9
                                                               No.   1984AP970-D

Balistrieri's reinstatement.          He also received two letters from

Attorney Balistrieri's sister, who did not explicitly express a

desire that the petition for reinstatement be denied but clearly

criticized her brother's character and alleged improper actions

by him.

      ¶13   The referee ultimately recommended reinstatement.                 He

concluded    that   Attorney    Balistrieri    had   proven    by    clear   and

convincing    evidence   that    he    sincerely     desires    to   have    his

license reinstated, that he has not practiced law during the

period of his suspension and revocation, that he has complied

with the terms of the suspension and revocation orders, and that

he has maintained competence and learning in the law.                We accept

the referee's findings and conclusions on these requirements for

reinstatement.

      ¶14   The issues in this reinstatement proceeding, however,

relate to other requirements for reinstatement, namely whether

the petitioning attorney has demonstrated that he has the moral

character to practice law in this state, that his conduct since
the suspension and revocation of his license has been exemplary

and above reproach, that he has a proper understanding of and

attitude toward the standards that are imposed upon members of

the bar and will act in conformity with them, and that he can be

safely recommended as a person fit to represent clients and to

aid   in     the    administration      of    justice    in     this    state.

SCRs 22.29(e)-(g) and 22.31(a).

      ¶15   The referee's report addresses a number of issues that
relate to these requirements, which admittedly are interrelated
                                      10
                                                                                  No.        1984AP970-D

and    overlapping.             The    referee       concludes         that       despite          these

issues, Attorney Balistrieri has met his burden on all of these

requirements        by    clear       and    convincing          evidence.              We    are       not

persuaded.

       ¶16    The      referee        begins       with     the       impact        of        Attorney

Balistrieri's conduct while previously licensed and of his 1984

conviction on his current petition for reinstatement.                                         Although

the referee acknowledged the conviction and even described it at

one point in his report as "clearly serious," he did not think

that the misconduct committed by Attorney Balistrieri in the

1970s and 1980s showed a moral character that should prevent

Attorney Balistrieri from returning to the practice of law at

this time.

       ¶17    The        OLR     has        offered        into        evidence              in     this

reinstatement        proceeding         the     letter       that      then       U.S.        Attorney

Thomas   Schneider         filed       in   response        to    Attorney         Balistrieri's

1995   reinstatement           petition.            The    lengthy         letter       provides          a

fairly   detailed         description         of     the    events         that    underlay             the
criminal      convictions        of     the    Balistrieris.                Attached          to    that

letter are a sizeable number of documents, including newspaper

articles      from       the    time    and     a    copy        of    a    transcript             of    a

conversation among Frank, Joseph, and John Balistrieri that was

secretly recorded by federal authorities.

       ¶18    Although           the          referee            acknowledged                 Attorney

Balistrieri's 1984 conviction, he essentially disregarded the

letter submitted by then U.S. Attorney Schneider.                                  The referee's
stated       reasons      for     giving       "no        great       weight"       to        Attorney
                                                11
                                                                              No.   1984AP970-D

Schneider's letter were that there was no evidence that Attorney

Schneider was in the U.S. Attorney's office at the time of the

prosecution         of     the    Balistrieris          in   the     1980s    and     that    the

letter's references to the "mob," "La Cosa Nostra," and the

"Mafia"       were        inflammatory        and        really      directed       at      Frank

Balistrieri, not Attorney Balistrieri.

       ¶19    On the other hand, the referee gave "great weight" to

the    fact       that    Attorney       Balistrieri         apparently       had     not    been

present      at    the     time    that     his    father      had    threatened       the    FBI

undercover agent with physical harm if the agent did not give

him a secret interest in the vending machine business.                                   He also

was apparently moved by the fact that Frank Balistrieri had

rejected a plea agreement in which the federal government would

have    dismissed          the    charges    against         the     Balistrieri       sons   in

exchange      for        Frank    Balistrieri's          guilty      plea.      The      referee

commented that "[a]pparently loyalty in the Balistrieri family

was a one-way street."

       ¶20    This court recognizes that the events of the 1980s and
the crime of which Attorney Balistrieri was convicted are now

several decades old.                We are not averse to providing a second

chance to hold a law license to individuals who clearly accept

responsibility for their wrongdoing and demonstrate that they

have    a     different          attitude    toward          complying       with   both      our

society's         general    laws    and     the       ethical     rules     that     apply    to

attorneys who are licensed to practice law in this state.

       ¶21    The        record     in    this         instance,      however,      does      not
demonstrate          that        Attorney         Balistrieri         has      clearly        and
                                                  12
                                                                            No.   1984AP970-D

convincingly proven that he has the required moral character to

practice law, that he has a proper attitude toward society's

laws and the standards imposed on members of bar, and that he is

fit to represent clients and to aid in the administration of

justice as a member of this state's bar.                             See SCR 22.29(4)(f)

and (g).

    ¶22     The record reveals a pattern of a lack of acceptance

of responsibility over the years that have passed since Attorney

Balistrieri's      conviction.             When     BAPR      recommended       against       the

reinstatement of his license in 1995, in large part based on its

conclusion    that          he    had   not    accepted       responsibility          for    his

criminal conduct, Attorney Balistrieri ultimately responded by

claiming that BAPR was biased against him because of his Italian

heritage.         He    attacked        the      integrity      of    the      reinstatement

process    with    a        completely     unsupported         charge     of    ethnic       bias

rather than demonstrate how his words and actions showed that he

now understood that he needed to obey both the letter and the

spirit of the law and the ethical rules governing attorneys.
    ¶23     In 2002 Attorney Balistrieri was deposed as part of a

lawsuit     that       he     and    his      brother     filed      against      a    distant

relative,     Jennie          Alioto,      the      substance        of   which       will     be

discussed in more detail below.                      A portion of the deposition

transcript,       however,          demonstrates        how    Attorney        Balistrieri's

attitude    toward          his   convictions       and    government       agencies         that

enforce the law had not changed.                        When opposing counsel asked

for his work history, Attorney Balistrieri described the period
from 1984 to 1989 as a time when he had been "employed by the
                                               13
                                                                     No.   1984AP970-D

United States government."             The opposing counsel subsequently

asked for some clarification, and the following exchange ensued:

    Q    Now, from '84 to '89 when you were working for
    the government, could you be more specific?

    A    I was in charge of the Recreation Department at
    the FCI9 Latuna Penitentiary.

    Q       What were you convicted of?

    A    I was convicted of a conspiracy to attempt to
    commit an extortion. Pretty esoteric stuff.

    . . . .

    Q       Is that the only conviction on your record?

    A    Let's see.   These indictments were brought by a
    homosexual child molester with a cocaine habit who
    admitted having bad decision-making processes during
    the time. So two indictments were dismissed. Then I
    went to trial after six weeks. I was acquitted, then
    we went to Kansas City for six months and the judge
    threw that out on a Rule 29 motion.    So, yes, that's
    the only time I was convicted.
    ¶24      Even    assuming     that    Attorney   Balistrieri           was   being

sarcastic, his answer demonstrates either a refusal to take his

conviction     seriously     or    a     contempt    for       the     federal    law

enforcement officials who investigated and prosecuted the case

against him.      His response also indicates that he did not view

the deposition that was being taken of him as a matter worthy of

being   treated     with   the    seriousness   that       a   legal       proceeding

warrants.

    9
       "FCI" is       an    abbreviation      for    "Federal          Correctional
Institution."

                                         14
                                                                  No.    1984AP970-D

       ¶25    In     the   present    reinstatement    proceeding,        Attorney

Balistrieri has asserted that he has now come to accept the

judgment of the federal court that convicted him.                       He is very

clear, however, to specify only that he is accepting the fact

that   the    federal      court   convicted   him   and   that   he    should   no

longer be angry or resentful about his conviction.                  He even goes

so far as to say that he "made a mistake," although he does not

explain what that mistake was, and that he broke the criminal

law.     While he is now willing to say that his attitude has

changed and he accepts that there was a conviction, he also

explicitly testified yet in this proceeding that he did nothing

wrong,       which     means   that    the     conviction    must       still    be

illegitimate to some degree in his view:

       Q    So I have read the indictment, and you submitted
       a   response   to   questionnaire  in   terms   of  an
       explanation.   Can you -- this is what I want you to
       explain.   I don't want to lead you.      This is your
       chance to explain, if you can.    Can you explain what
       you did that caused you to be charged with the
       conspiracy to extort in Count 1?

       The Witness:    According to the indictment now, not
       according to my perspective -- from my perspective, I
       really didn't do anything -- but according to the
       indictment, there was allegedly a threat made by my
       father to an undercover FBI agent who was sent here to
       initiate a sting operation on the theory that we
       controlled the vending and amusement game business in
       the City of Milwaukee.
(Emphasis added.)

       ¶26    We are not making a full and unconditional confession

of one's crime a prerequisite to the reinstatement of a law
license for everyone who has committed a crime.                    What Attorney

                                        15
                                                                     No.    1984AP970-D

Balistrieri    was    obligated    to    prove     by    clear       and    convincing

evidence, however, was that he has a good moral character, that

he possesses a proper attitude toward the standards that are

imposed upon members of the bar of this state, which includes

both the general law and the Rules of Professional Conduct for

Attorneys, and that he will act in conformity with them.                             His

grudging acceptance of the fact of his conviction after decades

of   besmirching       the   individuals         who      did    their        job    in

investigating    and    prosecuting     him   or    who    acted       within     their

proper role in the lawyer regulation system is not enough to

meet that standard.

     ¶27    We are also troubled by Attorney Balistrieri's failure

to report as income for tax purposes significant amounts of

money he received from his brother or the Shorecrest operations

and his failure to provide an adequate explanation for those

monies when responding to the OLR's inquiries.10                       In the 2002

deposition described above, Attorney Balistrieri said that from

1989 to the time of that deposition he had "been in partnership
with my brother Joseph."          When asked what that meant, Attorney

Balistrieri responded, "That means what we do we do together."

After     initially    refusing   to    explain         what    he    did    in     that

     10
       Because the referee downplayed the significance of the
tax issue, he did not make detailed findings of fact on this
subject.   The facts set forth in the following paragraphs of
this opinion, however, were not in dispute.       We are not
therefore usurping the role of the referee as the fact-finder.
The undisputed facts regarding this issue are sufficient to
demonstrate our point below.

                                        16
                                                              No.     1984AP970-D

partnership, Attorney Balistrieri stated, "My business is right

now we operate the Shorecrest Hotel.             You know that.        We're in

partnership together."

     ¶28   In    the   present     reinstatement    proceeding,        Attorney

Balistrieri asserted that during his brother's lifetime he had

no ownership interest in the Shorecrest Hotel, that the hotel

was owned solely by his brother, and that his brother made all

of   the   final       decisions    regarding      business     policy       and

disbursements.     He described himself as the "operations manager"

or "chief operating officer."          This meant that he handled the

daily operations of the building, including, inter alia, dealing

with rent collections, bank deposits, personnel issues, tenant

issues, license applications, city inspections, and maintenance

of the property (both major and minor repairs).                     He asserted

that he had to be available at all hours of the day and night to

take care of whatever problems arose.

     ¶29   In    exchange    for    his   work     overseeing        the   daily

operations of the Shorecrest, Attorney Balistrieri received a
substantial number of benefits.           For example, he acknowledged

that he received the ability to live rent-free in one of the

Shorecrest's apartments, and the Shorecrest or his brother paid

for his telephone, electricity, heat, health insurance, laundry,

cable television, and certain other living expenses.                    At some

point, the hotel or his brother also provided him with a car.

     ¶30   Attorney Balistrieri did not receive a regular salary

or wage in exchange for his work at the Shorecrest.                     He did,
however, receive a significant number of what both he and the
                                     17
                                                                        No.       1984AP970-D

referee referred to as "draws" or "owner's draws" that Joseph

Balistrieri took from the Shorecrest's revenues or accumulated

assets and shared with Attorney Balistrieri in equal amounts.

The    yearly      amount    of       these    draws,       according       to    documents

provided by Attorney Balistrieri, varied from year to year and

ranged during the period of 1997 to 2007 from $5,000 to $31,000.

The total amount for that eleven-year period was approximately

$200,000.

       ¶31    Attorney      Balistrieri        described       at     the        evidentiary

hearing      the   process      for    determining      when    these       "draws"       were

taken and in what amounts as follows:

       Well, Joe would call me in and he'd say, "What's our
       cash situation?   Can we take a draw?" And I'd run it
       down for him what our cash position was, and then he
       would decide whether or not we should take a draw and
       if we took a draw, how much we should take.
       ¶32    In    his      response          to     the      OLR's        reinstatement

questionnaire, Attorney Balistrieri similarly stated that his

brother and he would draw money from the business and share that

on a 50/50 basis, just as they shared "other income [Attorney

Balistrieri]       brought      in    from    the    non-hotel      business        projects

that [he] worked on."                 Thus, he acknowledges that, while his

brother may have signed the checks to him that were his portion

of    the    "draws",     the   money     he       received,   like     the       money   his

brother received, came from drawing money out of the business.

Further, he acknowledges that the draws he received out of the

revenue or assets of the business were in exchange for the work
that he performed at the hotel:                     "For my work at the hotel, my

                                              18
                                                                      No.    1984AP970-D

brother and I would draw money to the business account as an

owner's draw."

    ¶33    In    a      letter    submitted       by     Attorney      Balistrieri's

counsel on his behalf prior to the evidentiary hearing, Attorney

Balistrieri     asserted    that    the    benefits       he    received      from    the

hotel   business     and    his    brother      were     frequently         treated    as

"loans"   or    "loan    repayments."          Although    Attorney         Balistrieri

provided copies of the checks for these "draws" and those copies

were admitted as an exhibit, he did not submit into evidence any

exhibit that substantiated the loans or the fact that the money

he received as "draws" was really the repayment of loans he had

previously made to the Shorecrest or his brother.

    ¶34    At    the     reinstatement         evidentiary      hearing,       Attorney

Balistrieri's accountant stated that none of the money Attorney

Balistrieri received from the draws on the Shorecrest accounts

was recognized or reported as income to Attorney Balistrieri.

He did not say that the money was not income because it was

considered the repayment of loans.               Instead, he essentially gave
an expert opinion that the money was not income to Attorney

Balistrieri     because    Joseph    Balistrieri,         as    the   owner     of    the

Shorecrest, had been under no legal obligation to give the money

to Attorney Balistrieri, thereby making the thousands of dollars

mere gifts to Attorney Balistrieri.                 When Attorney Balistrieri

subsequently     resumed     his    testimony       at    the    hearing       and    was

questioned about these payments, he now claimed that he had made

a mistake about the nature of those payments and that they had
really just been gifts from his brother to him.
                                          19
                                                                      No.    1984AP970-D

       ¶35    The OLR presented the testimony of an expert witness

on the tax issue, an attorney and tax practitioner with a large

accounting firm, who had previously worked for the Chief Counsel

of the Internal Revenue Service (IRS).                  The OLR's witness opined

that he did not see how the "draws" paid to Attorney Balistrieri

could be considered "gifts" for income tax purposes.                         He stated

that the determination of whether money paid to an employee was

a     gift   would    require     an    analysis        of   all    the     facts     and

circumstances surrounding the payment, not merely an assertion

that someone intended to characterize the payment as a gift.                          He

further stated that, other than the accountant's assertion that

Joseph Balistrieri had been under no legal obligation to make

payments      to   Attorney     Balistrieri,         there   was    no    evidence     to

support      characterizing     those    payments       as   gifts.         Indeed,    he

stated his view on this quite emphatically:                        "I can't imagine

that anyone in this room honestly thinks those were gifts."

Further, to the extent that Attorney Balistrieri claimed that

the     characterization        of     the        payments   as    gifts      was     the
accountant's determination on which he had relied, the OLR's

expert witness stated that Attorney Balistrieri would need to

demonstrate that he had relied on his accountant's advice in

good faith.          The OLR's expert opined that given the lack of

evidence to support a gift, there was no possibility to have

relied in good faith on any determination by the accountant that

the payments were gifts.

       ¶36    During the evidentiary hearing, the referee expressed
concern with the OLR's pursuit of questioning about the tax
                                             20
                                                                              No.    1984AP970-D

implications of the payments and benefits provided to Attorney

Balistrieri and whether pursuing the line of questioning would

make this a tax case as opposed to a reinstatement proceeding.

In response to the referee's request for clarification as to

what the OLR was attempting to demonstrate, the OLR's counsel

responded    that       the        OLR   was     primarily      concerned      with       whether

Attorney     Balistrieri's               disclosures          about    the     benefits       and

payments he received were accurate and sufficient and not really

concerned    with        the       issue    of    whether       the    payments       had    been

treated properly for income tax purposes.

      ¶37    In        his     report,         the     referee        spent    little        time

addressing        these        issues.            Although       he     acknowledged          the

difference        between          the   testimony        of    Attorney       Balistrieri's

accountant and the OLR's witness, he did not attempt to resolve

the dispute.            Essentially, he concluded that the tax issues

should not be the focus of this proceeding, and that since the

IRS   had   never        challenged          Attorney         Balistrieri's         income    tax

returns, the issue of the payments to Attorney Balistrieri and
the tax ramifications of those payments should be disregarded.

      ¶38    We    do        not    share      the     view    that    these    matters       are

unimportant to the question of whether Attorney Balistrieri's

license     to     practice          law       should     be    reinstated.            As     the

petitioning attorney, he is obligated under the rule to prove,

by clear and convincing evidence, that his conduct since the

revocation        of    his        license       has    been     "exemplary         and     above

reproach."        SCR 22.29(4)(e).               Whether an attorney has properly
reported income on the attorney's income tax returns and whether
                                                 21
                                                                     No.     1984AP970-D

the attorney has properly disclosed the nature and sources of

income to the OLR in the reinstatement process are both matters

that clearly bear on the attorney's post-suspension or post-

revocation    conduct    and     whether      he   or   she    has   a     good    moral

character and is fit to regain the privilege of acting as an

attorney and officer of the court in this state.11                         Indeed, the

failure to report income on one's tax returns has been a basis

for   the   imposition     of   a   range     of   public     discipline      by    this

court.      See,   e.g.,    In      re   Disciplinary         Proceedings      Against

Washington, 2007 WI 65, 301 Wis. 2d 47, 732 N.W.2d 24 (18-month

suspension imposed on attorney convicted of attempting to evade

payment of federal income taxes for underreporting her income);

In re Disciplinary Proceedings Against Elverman, 2008 WI 28,

308 Wis. 2d 524, 746 N.W.2d 793 (nine-month suspension imposed;

distinction drawn between forgetting to report income over three

years, which would have made the court more inclined to impose

      11
       Attorney Balistrieri's accountant also expressed the view
that the federal and state governments were not really harmed
because Joseph Balistrieri had not claimed these payments to his
brother as an expense of the business and therefore had paid
income taxes on the money he shared with Attorney Balistrieri.
Whether or not the federal and state governments ultimately
received the same amount of tax revenues, which has not been
proven, is not the issue.      The issue for purposes of this
reinstatement proceeding is whether Attorney Balistrieri, the
person petitioning for reinstatement, was obligated under the
law to report those payments as income on his tax returns and
followed the law. Whether Joseph Balistrieri may also have been
able to reduce his reportable income if the payments had been
characterized as income to Attorney Balistrieri is not at issue
in this proceeding.

                                         22
                                                                              No.    1984AP970-D

public reprimand, and deliberately choosing not to report income

for two years, which supported the nine-month suspension); In re

Disciplinary            Proceedings       Against           McKinley,        2014 WI 48,

___ Wis. 2d ___,             848 N.W.2d 295            (accepting         stipulation          and

imposing 60-day suspension on attorney convicted of filing tax

returns      she    believed      to     be    not    true     or    accurate       because     of

underreporting          of   income).          Thus,     the       presence    of    questions

about an attorney's proper reporting of income is a relevant

part of the reinstatement calculus.

       ¶39    Although we acknowledge that there is a difference of

opinion      between      the     OLR's       expert    and       Attorney     Balistrieri's

accountant/expert, that acknowledgement does not mean that we

are obligated to resolve the dispute and render a definitive

ruling       on    whether       Attorney       Balistrieri's          tax     returns         were

improper.         We conclude, however, that there is, at a minimum, a

real     question        about     the    propriety          of     Attorney        Balistrieri

failing to report as income the hundreds of thousands of dollars

that he received out of draws from the Shorecrest's accounts.
Simply    stating         the    conclusion          that    the     payments       should      be

treated      as    gifts        because       Joseph     Balistrieri          had    no     legal

obligation to make the payments to Attorney Balistrieri begs the

question.         Had these payments been made simply because Attorney

Balistrieri was a family member, that would be one thing.                                       By

Attorney Balistrieri's own admission, however, these payments

were made to him "[f]or my work at the hotel."                                       Generally,

payments made to an employee as a result of the employee's work
are    income      to    the     employee       subject       to    the   payment         of   all
                                                23
                                                                          No.    1984AP970-D

applicable          taxes,     including           income        taxes.              Attorney

Balistrieri's        accountant,       however,      clearly       stated       that    these

payments     were     not    reported       as     income.         If   these        periodic

payments over two decades did not need to be reported as income

because      they     were    mere     gifts       from     his    brother,          Attorney

Balistrieri needed to prove that fact by clear and convincing

evidence.      In the absence of such proof, it appears that he

received income due to his employment that he did not report as

income.

      ¶40    The     fact    that    the    IRS    has    not     challenged         Attorney

Balistrieri's tax returns does not prove that                             these payments

were actually gifts or that this issue should be disregarded in

this reinstatement proceeding.                    Who knows why the IRS has not

audited or challenged the tax returns?                      Perhaps it is not aware

of these payments.           Perhaps it has chosen to focus its limited

resources on other matters.                In any event, it is this court, not

the   IRS,     that       ultimately       determines       whether       a     petitioning

attorney has met the standards required for the reinstatement of
the attorney's license.

      ¶41    As noted above, we need not decide whether or not the

"draws"     paid     to    Attorney    Balistrieri          or    the   other        benefits

provided to him were income that needed to be reported on his

tax   returns.         The   evidence       in     the    record    raises       a    serious

question regarding whether Attorney Balistrieri's conduct since

the revocation of his license has been "exemplary and above

reproach."      He bore the burden to demonstrate that he has met
that standard.        He has failed to meet his burden on this issue.
                                             24
                                                                     No.    1984AP970-D

     ¶42    There are two other issues, which are related to each

other,    that    were   greatly    downplayed         by    the   referee.       These

issues relate to an answer that Attorney Balistrieri gave to

questions from the OLR about lawsuits to which he had been a

party and to his conduct in connection with a specific lawsuit

against his maternal relative, Jennie Alioto.

     ¶43    The OLR's reinstatement questionnaire asked Attorney

Balistrieri to "[s]ubmit a statement showing the dates, general

nature,    current   status,     or   final      disposition        of    every    civil

action,    commenced     or   pending     in    any    jurisdiction        during   the

period of your revocation or suspension, wherein you were either

a party, plaintiff or defendant, or in which you had or claimed

an   interest."12         The      question      further       required         Attorney

Balistrieri to provide case names and numbers, as well as the

court in which the case was pending.                        Attorney Balistrieri's

response    did    not   identify     any      civil    action.          Although   the

question asked for an identification of any civil action in

which he had been or was a party, regardless of the disposition,
Attorney    Balistrieri       responded     only      that    "I   have    no   present

recollection of any judgment ever being taken against me for any

purpose."    When asked about this response in multiple questions

at his deposition, he again failed to identify any civil action.

After taking a break and conferring with his counsel, he stated

     12
       This question is a standard part of the reinstatement
questionnaire that the OLR sends to attorneys who petition for
reinstatement following a disciplinary revocation or suspension.

                                          25
                                                                         No.     1984AP970-D

for the first time that he had been involved in a lawsuit with

Alioto and in two pieces of litigation involving his sisters,

although Attorney Balistrieri claimed that these matters were

really his brother's actions and not his and that his brother

Joseph      had    merely    added        his    name   to   the     actions.       At   the

subsequent         evidentiary       hearing,        Attorney      Balistrieri     claimed

that he had no independent recollection of the Alioto litigation

until the questions at the deposition had "jogged" his memory.

       ¶44    At     the     evidentiary          hearing,      Attorney       Balistrieri

admitted that he had been involved in six lawsuits since the

time of his first reinstatement petition.                           There were actually

two lawsuits in which Attorney Balistrieri was a plaintiff suing

Jennie Alioto.           In the first, which will be discussed in more

detail below, both Attorney Balistrieri and his brother Joseph

were the plaintiffs.               After Attorney Balistrieri and his brother

lost   that       lawsuit,     a    second       lawsuit     was    filed.      This     time

Attorney Balistrieri was the sole plaintiff.                         In another action,

one    of    his     sisters       sued    both      Attorney      Balistrieri     and   his
brother Joseph, as well as their other sister.

       ¶45    The OLR argued that Attorney Balistrieri's failure to

identify       any      of   these        actions       in   his     response      to    the

reinstatement questionnaire or in his initial deposition answers

showed that his conduct in the reinstatement proceeding had not

been exemplary and above reproach.                      After acknowledging that he

had been initially troubled by the failure to provide accurate

information        in   response      to    the      OLR's   questions,      the   referee
found,       based      on   Attorney           Balistrieri's       testimony      at    the
                                                26
                                                                           No.        1984AP970-D

evidentiary hearing, that he had really forgotten about these

various    lawsuits        in    which        he     had    been     a   party,         thereby

concluding that his responses, while inaccurate, had not been

deliberately false.

    ¶46        Given the clearly erroneous standard for reviewing the

referee's finding of fact on this subject, especially where the

factual issue involves a determination of what was in someone's

mind, we accept the referee's finding that Attorney Balistrieri

could    not     recall    any   of     the    lawsuits       in   which     he       had   been

involved       until     the   middle    of        his   deposition.         We       therefore

conclude that the inaccurate answers are not a basis to conclude

that Attorney Balistrieri has failed to show that his post-

revocation conduct has been exemplary and above reproach.

    ¶47        The failure to recall the Alioto litigation, however,

is not the only issue raised by that litigation.                                  The first

action in which Attorney Balistrieri and his brother sued Jennie

Alioto presents a troubling situation.

    ¶48        The facts of that litigation are set forth in the
decision of the court of appeals, which affirmed the circuit

court's judgment dismissing the Balistrieris' claim to enforce a

purchase        option     and   awarding           costs    in      favor       of     Alioto.

Balistrieri        v.     Alioto,       No.        2004AP929       (December          1,    2005

unpublished opinion).            Alioto worked for Attorney Balistrieri's

father     as     a     bookkeeper      for        many     years.       Both          Attorney

Balistrieri and his brother had a long personal relationship

with her.        Indeed, both brothers performed legal work for her
without charge, and Attorney Balistrieri often helped her with
                                              27
                                                                         No.    1984AP970-D

her   business        affairs.        In    1978,    Attorney     Balistrieri        helped

Alioto purchase a building on North Jackson Street in Milwaukee,

and he thereafter quite often assisted her in maintaining or

managing the property.              The trial court found that Alioto relied

on    Attorney       Balistrieri's         assistance       and   his    advice      in   her

business affairs.

          ¶49    In 1991 Attorney Balistrieri discussed the future of

the Jackson Street property with Alioto.                           She told Attorney

Balistrieri that she did not wish to sell the property because

she       needed     the    rental     income       from    the    property       for     her

retirement, but that she would be willing to give him and his

brother a right of first refusal to purchase the property before

anyone else if she ever sold it.                     In 1992, Alioto and the two

Balistrieri brothers signed an agreement regarding the property.

The       agreement,       however,    did    not    provide      a     right   of      first

refusal, but rather gave the brothers an option to purchase the

property for a set price ($125,000) within the next ten years.

Alioto testified in the subsequent lawsuit that she did not read
the agreement before signing it.

          ¶50    Three months later, Alioto read the agreement and came

to understand that it provided for a straight option to purchase

at    a    set     price.     She     then    called       Attorney     Balistrieri       and

expressed        concern     that     the    contract       was   not    what   they      had

previously talked about.               In particular, she expressed surprise

that the agreement contained a specific purchase price and a

specific date by which the option could be exercised by the

                                             28
                                                                           No.    1984AP970-D

brothers.         Attorney Balistrieri told her not to worry about what

was in the agreement and that he would do right by her.

       ¶51    In 2002, as the 10-year period came to a close, the

Balistrieri brothers both served letters on Alioto that stated

that they were exercising their option to purchase the Jackson

Street property.           When Alioto refused to sell the property to

them    at     the    price       set     forth       in     the    contract,       Attorney

Balistrieri and his brother sued her for specific performance of

the option agreement.

       ¶52    The case was tried to the bench.                          The circuit court

found   that       there    had    been    a    fiduciary          relationship      between

Attorney Balistrieri and Alioto, that Attorney Balistrieri had

engaged      in    intentional      misrepresentation              in    connection       with

obtaining the option agreement, that Alioto was justified in

relying on Attorney Balistrieri's statement that she had nothing

to worry about, and that Attorney Balistrieri and his brother

were    joint        venturers          such        that      Attorney      Balistrieri's

misrepresentations could be imputed to his brother.                              The circuit
court        therefore      ruled        that         the      option      contract        was

unenforceable.             It   dismissed           the     Balistrieris'        claims    and

awarded costs to Alioto.

       ¶53    Attorney Balistrieri and his brother appealed.                              The

court of appeals affirmed the trial court's rulings.                              This court

denied the Balistrieris' petition for review.

       ¶54    The referee also did not view this matter as anything

that should prevent the reinstatement of Attorney Balistrieri's
license.       While the referee said it was not his role to second
                                               29
                                                                             No.    1984AP970-D

guess the circuit court's findings or legal conclusions or to

re-try the civil action, he specifically said that he questioned

the credibility of Alioto's testimony, which the circuit court

in     the   civil      action      had       accepted    as     credible.            He      also

questioned the circuit court's admission of the recording that

Alioto       made    of      her    telephone          conversation          with      Attorney

Balistrieri, in which he told her not to worry about the fact

that     the    agreement          was    different       than        she    had      initially

discussed       with      him.13         In    the     end,     the    referee        found      it

significant that the attorney who had represented Alioto in the

civil action had testified at the reinstatement hearing that the

Alioto       litigation        should          not     affect         this     reinstatement

proceeding.            The    referee         agreed     that    the        circuit      court's

findings       in   the      Alioto      civil       litigation       should       not     "be   a

barrier" to the reinstatement of Attorney Balistrieri's license.

       ¶55     We do not think this matter should be disregarded so

lightly.       The circuit court specifically found, and the court of

       13
       The   Balistrieris   challenged  the   admission  of   the
recording on appeal and argued that the recording provided the
sole evidentiary basis for the trial court's ruling. The court
of appeals did not rule on whether the recording had been
properly admitted. It did conclude that, even if the recording
had been improperly admitted, its admission had not prejudiced
the outcome of the trial because Alioto had testified at trial
based on her independent recollection of her conversations with
Attorney Balistrieri.   Thus, the admission or exclusion of the
tape recording cannot undermine the circuit court's and the
court of appeals' conclusions or affect the relevance of those
conclusions to the present reinstatement proceeding.    Moreover,
even the referee acknowledges that Attorney Balistrieri denied
having any conversation until the tape recording was produced.

                                                30
                                                                              No.     1984AP970-D

appeals affirmed, that Attorney Balistrieri and his brother had

a     fiduciary      duty     to   Alioto        because       of     the     inequality      of

sophistication in business matters, the fact that Alioto had

been a client of both Balistrieri brothers when they had been

practicing lawyers, and the fact that she had continued to rely

on Attorney Balistrieri's business advice and support after he

was no longer practicing law.                    The circuit court further found

that Attorney Balistrieri had violated this fiduciary duty and

had      obtained            the        option       contract           by          intentional

misrepresentation.            The court of appeals agreed that, in light

of Alioto's statements to Attorney Balistrieri that she would be

willing to give him and his brother a right of first refusal,

his failure to disclose to Alioto that the agreement actually

gave them an option to purchase the Jackson Street property for

a   specific        price    to    be    exercised        at    their       sole    discretion

constituted an actionable failure to speak when disclosure was

required and "fulfill[ed] the elements of misrepresentation."

In essence, the courts in the Alioto litigation concluded that
Attorney Balistrieri took advantage of his superior knowledge of

business       and    the    law   to     obtain     an    agreement         from     an   older

relative       that    would       have     benefitted          him     and     his     brother

financially and then sued her to enforce that agreement.                                   There

is no basis to attack and relitigate those conclusions in this

proceeding.

       ¶56     We    conclude      that     engaging       in       misrepresentation         in

order     to    take        advantage      of    a   less       sophisticated           person,
especially one with whom there is a fiduciary relationship, does
                                                31
                                                                               No.    1984AP970-D

not show a moral character of the type needed to practice law in

this state, SCR 22.31(1)(a), does not constitute conduct that is

exemplary       and    above           reproach,      SCR 22.29(4)(e),         and    does    not

demonstrate        that      Attorney          Balistrieri        has    a   proper    attitude

toward the standards that are imposed upon members of the bar

and      will         act         in      conformity         with        those       standards,

SCR 22.29(4)(f).             Such conduct also does not befit a person who

"can safely be recommended to the legal profession, the courts

and the public as a person fit to be consulted by others and to

represent       them        and    otherwise       act      in    matters      of    trust    and

confidence."          SCR 22.29(4)(g).

       ¶57    We      recognize          that,     unlike        the    1995     reinstatement

proceeding,        Attorney            Balistrieri         did    present      testimony      and

letters from a significant number of individuals in support of

this   reinstatement              petition.           We   also     acknowledge       that    the

record contains evidence that Attorney Balistrieri has engaged

in some charitable activities, including serving as a director

and president of a golf tournament that raises money for high
school scholarships to private schools.

       ¶58    In the end, however, this reinstatement proceeding is

governed by the rules and standards contained in this court's

rules.       Those rules require Attorney Balistrieri to prove that

he has satisfied all of the requisite standards by clear and

convincing       evidence.               For    the    reasons         described     above,    we

conclude that he has failed to meet his burden to prove that he

possesses the requisite moral character to practice law in this
state, that his conduct since the revocation of his license has
                                                 32
                                                                             No.   1984AP970-D

been     exemplary     and        above    reproach,     that      he        has   a    proper

understanding of and attitude toward the standards imposed upon

members of the bar, that he will act in conformity with those

standards, and that he can be safely recommended as a person fit

to be consulted by others, to represent them, and to otherwise

act in matters of trust and confidence.

       ¶59    The final issue to be addressed is the matter of the

costs of this proceeding.                  The OLR submitted a statement of

costs indicating that the total costs of the proceeding, as of

February 4, 2013, were $41,459.40.                    It recommended that Attorney

Balistrieri be required to pay the full costs of the proceeding,

consistent with the court's general policy of imposing the costs

of reinstatement proceedings on the petitioning attorney.                                     It

noted that this proceeding involved a large amount of discovery

and a highly contentious evidentiary hearing.

       ¶60    Attorney       Balistrieri         objected     to   the       imposition       of

costs.       He first argued that he should not be required to pay

any of the costs of this reinstatement proceeding because the
referee had recommended that his license should be reinstated.

Attorney Balistrieri analogized this reinstatement proceeding to

a disciplinary proceeding where no misconduct is found.                                  Since

SCR 22.24(1m)        states       that    this    court's     general        policy      is   to

impose    costs      "upon    a    finding       of   misconduct,"       costs         are    not

imposed      where    no     misconduct          is   found    and       a     disciplinary

complaint      is    dismissed.           Attorney     Balistrieri           reasoned        that

receiving a recommendation for the reinstatement of his license
was similar to a finding of no misconduct, and therefore he
                                             33
                                                                              No.    1984AP970-D

should not be required to pay any costs.                            Moreover, he noted

that while the OLR had opposed his petition before the referee,

it         did    not      appeal     the      referee's           recommendation             for

reinstatement, making it inequitable to impose costs on him.

       ¶61       The referee does not agree with Attorney Balistrieri's

argument that no costs should be imposed, noting that this court

has imposed costs in cases where referees had recommended denial

and this court has nonetheless ultimately granted reinstatement.

       ¶62       This     argument     by     Attorney       Balistrieri            is     easily

dispatched.            It is this court that makes the final determination

on     a     reinstatement      petition,       and     we       have    determined          that

Attorney         Balistrieri's       petition      must     be     denied.          Thus,     his

argument is no longer supported by the facts.                                 Moreover, this

court's general policy has been to impose full costs on the

attorney petitioning for reinstatement even where the referee

recommends reinstatement and this court grants reinstatement.

See SCR 22.24(1m); see, e.g., In re Disciplinary Proceedings

Against          Ouchakof,     2013 WI 48,     ¶16,        347 Wis. 2d     604,
830 N.W.2d 677; In re Disciplinary Proceedings Against Woodard,

2012 WI 41,    ¶37,   340 Wis. 2d     248,    812 N.W.2d 511.      The

reinstatement            proceeding     is     a     result        of        the    attorney's

misconduct         that    required     the    imposition          of    a    suspension       or

revocation in the first place.                 It is therefore generally proper

to impose the costs of a formal reinstatement proceeding upon

the attorney seeking reinstatement.

       ¶63       Alternatively,       Attorney       Balistrieri         argues       that    the
OLR's requested cost amount that is assessed against him should
                                              34
                                                                                  No.    1984AP970-D

be "significantly less than the full costs claimed" because the

OLR's costs are excessive.                   Again, Attorney Balistrieri bases

his    argument       for     a    reduction       in      costs     on     the    fact     that   a

significant portion of the OLR's time was spent in investigating

and litigating issues that the referee found to be of minimal

significance or found unpersuasive.

       ¶64   The       referee          agrees     with         this       part     of     Attorney

Balistrieri's argument.                  The referee notes that the applicable

rule now in effect envisions a procedure whereby the referee

considers       the     parties'          submissions           on     costs      and     makes     a

recommendation.               He        therefore       concludes           that        under     the

appropriate circumstances, it is proper to reduce the amount of

costs requested by the OLR.                  He believes that the OLR "treated

this matter as some sort of tax court hearing rather than a

reinstatement proceeding," which resulted in substantial amounts

of    time   and      money       being    spent      on    document         requests,       expert

witness      preparation,              depositions         of     expert       witnesses,         and

hearing testimony regarding the tax issues.                                 Since the referee
concluded that the tax issues were not of any real importance

because the IRS had not challenged Attorney Balistrieri's tax

returns, he recommends that the OLR's fees and costs related to

tax    issues      should         be    eliminated         from      any    cost        assessment.

Specifically, he recommends that the court not impose any of the

fees paid to the OLR's expert witness or any of the court-

reporting     fees      for        discovery       depositions.              To     avoid       going

through the invoices of the OLR's counsel, he recommends that

                                                 35
                                                                          No.    1984AP970-D

OLR's counsel fees simply be reduced by one-half.                           This results

in a recommended cost total of $19,215.51.

      ¶65    As demonstrated above, however, we have disagreed with

the   referee's      view       that     certain        issues,    including      the         tax

issues,     were    of    little        significance        in    determining       whether

Attorney Balistrieri met his burden of satisfying the standards

for reinstatement.             We therefore will not reduce the cost amount

for this reason.

      ¶66    With respect to whether the OLR's costs were simply

excessive, Attorney Balistrieri does make reference to a few

specific numbers in his objection, both hours expended by the

OLR's     counsel        and     its     expert         witness    as     well      as        the

corresponding cost amounts.                  He does not, however, provide any

specific    reasons       why     those      amounts      are    too    high,    except        to

assert that they related to issues that the referee found to

have little significance, which we have already rejected as a

reason to reduce the costs.                  SCR 22.24(2) ("A respondent [or an

attorney     petitioning          for     reinstatement]          who     objects        to    a
statement of costs must explain, with specificity, the reasons

for the objection . . . .").                    He also does not state what he

would consider a reasonable amount of time or fees spent on

those   issues      or    tasks.          Id.      (a    respondent      attorney        in     a

disciplinary        proceeding          or      an      attorney        petitioning           for

reinstatement who objects to costs "must state what he or she

considers to be a reasonable amount of costs").                            Consequently,

we will not reduce the cost assessment on this ground.

                                              36
                                                                    No.    1984AP970-D

    ¶67     Finally, Attorney Balistrieri asks for a reduction in

the costs because of the financial burden it will impose on him

and his family.          He contends that the testimony received at the

evidentiary hearing shows that he is not a wealthy man.                           Plus,

he notes that he has already incurred a substantial amount of

attorney     fees    for    his   own     counsel       in   this    reinstatement

proceeding.         In    situations     where     an    attorney     has    limited

financial     resources      to   pay     the    costs       associated      with     a

disciplinary        or    reinstatement       proceeding,      this       court     has

generally not reduced the cost award simply for that reason.

Doing so shifts the burden for those costs to all of the other

lawyers in the state who must pay an annual cost assessment for

the lawyer regulatory system in order to maintain their law

licenses.     The court's general policy in such situations is to

direct the attorney to provide financial information to the OLR

and to try to negotiate a payment plan for the payment of the

costs over time.         We follow that policy here.

    ¶68     IT IS ORDERED that the petition for reinstatement of
the license of John J. Balistrieri to practice law in Wisconsin

is denied.

    ¶69     IT IS FURTHER ORDERED that within 120 days of the date

of this order, John J. Balistrieri shall pay to the Office of

Lawyer     Regulation       the   full     costs        of   this    reinstatement

proceeding.

    PATIENCE DRAKE ROGGENSACK, J., withdrew from participation.

                                         37
                                                                          No.     1984AP970-D.awb

     ¶70       ANN WALSH BRADLEY, J.                (dissenting).           In an attorney

reinstatement proceeding, the referee is the finder of fact.                                    It

is the responsibility of the referee to scrutinize and to weigh

the testimony of the witnesses and to determine the effect of

the evidence as a whole.                     We are to defer to the referee's

assessment of the credibility of witnesses.                            In re Disciplinary

Proceedings Against David V. Jennings, III, 2011 WI 45, ¶39,

334 Wis. 2d 335, 801 N.W.2d 304.

     ¶71       The   majority      correctly         sets      forth      the     standard       of

review    in    reinstatement          proceedings:            we    do     not     overturn      a

referee's findings of fact unless they are clearly erroneous.

Per curiam, ¶3.          Nevertheless, the majority seems to ignore it.

In   rejecting         the      referee's          "strong"         recommendation             that

Balistrieri's        license      be    reinstated,           the    majority           fails    to

adequately       explain     why       the     referee's        findings          are     clearly

erroneous.           Instead,      it    retries         the     case       and     reassesses

credibility.

     ¶72       In giving the requisite deference to the role of the
referee    as    the   trier     of     fact       and   in    correctly         applying       the

standard of review, I conclude that the referee's findings are

not clearly erroneous.              I would accept the referee's findings

and grant Balistrieri's reinstatement petition.

     ¶73       During the three days of the evidentiary hearing, the

referee    listened        to    live        testimony        from     13       "distinguished

lawyer[]       and   non-lawyer[]"           witnesses        who    supported          Attorney

Balistrieri's        reinstatement.            Referee        Report,       ¶27.         The    OLR
examined Balistrieri adversely and called just one witness.                                     In

                                               1
                                                                     No.    1984AP970-D.awb

addition      to    the    live    testimony,       the    referee        received     seven

letters in support of reinstatement from people who did not

testify at the hearing.              Balistrieri's sister wrote two letters

opposing reinstatement.             After hearing all of the testimony and

reading all of the letters, the referee "strongly" recommended

that    Balistrieri's            petition     for       reinstatement       be     granted.

Referee      report,      ¶47.      The    OLR    did    not     appeal    the    referee's

recommendation.

       ¶74    The    referee       found     that   Balistrieri           had    proven    by

clear, satisfactory, and convincing evidence that he had met the

criteria for reinstatement set forth in SCRs 22.29(4)(a)-(g) and

22.31(1)(a).        The referee found that (1) he sincerely desires to

have his license reinstated, (2) he has not practiced law during

the period of his suspension and revocation, (3) he has complied

with the terms of the suspension and revocation orders, (4) he

has maintained competence and learning in the law, (5) he has

demonstrated that he has the moral character to practice law in

this state, (6) his conduct since the revocation of his license
has    been   exemplary      and     above    reproach,        (7)   he    has    a    proper

understanding        of    and    attitude       toward    the    standards       that    are

imposed upon members of the bar and will act in conformity with

them, and (8) he can be safely recommended as a person fit to

represent clients and to aid in the administration of justice in

this state.

       ¶75    The    majority,        however,          states     that     it    is      "not

persuaded."          In reassessing credibility, the majority asserts
that the "record reveals a pattern of a lack of acceptance of

                                              2
                                                                           No.    1984AP970-D.awb

responsibility over the years that have passed since Attorney

Balistrieri's          conviction."          Per       curiam,       ¶22.            It      cites

Balistrieri's           response       to     BAPR's          recommendation              against

reinstatement in 1995 and his answer to a question in a 2002

deposition.        Id., ¶¶22-23.            The majority grudgingly notes that

Balistrieri      testified        he   "made       a    mistake,"          but    then     quotes

Balistrieri's          testimony    that      "from      my    perspective,           I    really

didn't do anything."             Id., ¶25.

      ¶76    The       referee     wrote     that      in     the    1996        reinstatement

proceeding, "one sees a man who by his own admission 'was angry

and felt cheated and felt [he] had been handed a raw deal.'"

The   referee          quoted     Balistrieri's          testimony           to     show     that

"[t]oday, Balistrieri sees things differently:

      You know, the judgment of the court was the judgment
      of the court, which I accept, you know.        I was
      sentenced to a prison term which I served.    I don't
      have that hostility or that feeling of being cheated
      or of being treated unfairly. I accept all that. And
      I made a promise to myself two years ago to drop all
      the anger, to drop all the resentment, and to accept
      things as they are, to recognize that if the court
      found that, then that was a justified determination,
      and I must bear the penalty for it. You know, it was
      nobody's fault but my own. I made a mistake – people
      are not perfect – and I paid for it. And now I hope
      to rehabilitate in the last years of my life my
      career, and my reputation.
Referee report, ¶26, quoting Tr. p. 476.

      ¶77    The referee further explained that the record in this

reinstatement          proceeding      was     profoundly           different         than    the

record      in     a     prior     reinstatement              proceeding.              Thirteen

"distinguished lawyers and non-lawyers" testified in support of
Balistrieri's          reinstatement         and       seven        more     wrote        letters

                                              3
                                                          No.    1984AP970-D.awb

supporting reinstatement.          They all believed he had the moral

character necessary to practice law and that he met the criteria

for reinstatement.     The referee wrote:

    "[T]he record in this 2012 proceeding stands in stark
    contrast to the record in the 1996 reinstatement
    proceeding. In 1996, Balistrieri and his brother were
    the   only  live   witnesses.      In   2012,   thirteen
    distinguished lawyers and non-lawyers testified live
    in support of Balistrieri's petition.      In 1996, the
    U.S. Attorney, the Wisconsin Attorney General and the
    Milwaukee District Attorney all wrote letters opposing
    reinstatement.   In 2012, only Balistrieri's estranged
    sister wrote two letters in opposition.      Besides the
    thirteen attorneys who testified, seven more wrote
    letters in support of Balistrieri's current petition.
    In short, the record in 2012 is most impressive and
    overwhelmingly supports reinstatement."
Referee Report, ¶27.

    ¶78    In finding that Balistrieri had demonstrated by clear,

satisfactory, and convincing evidence that he met the criteria

for reinstatement set forth in SCR 22.31, the referee summarized

the oral and written statements made in support of Balistrieri's

reinstatement.      Below     is   a   mere   sampling   of    some   of   those

statements.      They represent statements from some of the most

distinguished attorneys in this state.
          Attorney      1:        "Since      [Balistrieri's]        criminal

           conviction, he has led an exemplary life without any

           further involvement or any negative influence. . . .

           Without reservation, I completely and fully endorse

           and recommend his reinstatement of his law license."

          Attorney 2:      "I strongly recommend that [Balistrieri]

           be admitted to the State Bar of Wisconsin.                      He is
           intelligent, trustworthy and honest.               He works hard at

                                        4
                                                         No.    1984AP970-D.awb

            every task he assumes and, even though not practicing

            law, continues to recognize lawyers' duties to clients

            and to the profession."

           Attorney 3:      "I highly recommend that you allow for

            [Balistrieri's] reinstatement.           I am 100% confident

            that he will practice law in an utmost ethical manner

            . . . ."

           Attorney   4:    "I   sincerely    believe   that     it   was   a

            privilege for me to meet and work with Mr. Balistrieri

            and I highly recommend that he be reinstated.               He is

            truly an asset to the legal profession."

    ¶79     Based   upon    the   referee's   credibility      determinations

and the weight he gave the witnesses' testimony, together with

his findings of fact, I conclude there is only one proper result

here:       granting   Balistrieri's      petition    for      reinstatement.

Accordingly, I respectfully dissent.

                                      5
    No.   1984AP970-D.awb

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