Court Opinion

ID: 2690142
Source: CourtListenerOpinion
Date Created: 2014-08-01 20:38:11.840621+00
Date Added: 2024-06-11T12:52:26.397712
License: Public Domain

[Cite as Disciplinary Counsel v. Streeter, 138 Ohio St. 3d 513, 2014-Ohio-1051.]

                        DISCIPLINARY COUNSEL v. STREETER.
          [Cite as Disciplinary Counsel v. Streeter, 138 Ohio St. 3d 513,
                                    2014-Ohio-1051.]
Attorneys—Misconduct—Engaging in conduct involving dishonesty, fraud, deceit,
        or misrepresentation and in conduct adversely reflecting on fitness to
        practice law—Two-year suspension, 18 months stayed on conditions.
  (No. 2013-0581—Submitted September 11, 2013—Decided March 25, 2014.)
    ON CERTIFIED REPORT by the Board of Commissioners on Grievances and
                     Discipline of the Supreme Court, No. 12-055.
                                 ____________________
        Per Curiam.
        {¶ 1} Respondent, David Allen Streeter Jr. of Cleveland, Ohio, Attorney
Registration No. 0073936, was admitted to the practice of law in Ohio in 2001.
        {¶ 2} In an August 2012 complaint, relator, disciplinary counsel, alleged
that Streeter misappropriated more than $230,000 in funds from real estate
closings that he conducted in the operation of his business, Statewide Title
Agency, Ltd. The parties submitted a timely consent-to-discipline agreement, but
the panel rejected the agreement and set the matter for hearing.
        {¶ 3} At the hearing, the parties submitted stipulations of fact and
misconduct in which Streeter acknowledged that his conduct violated
Prof.Cond.R. 8.4(c) (prohibiting a lawyer from engaging in conduct involving
dishonesty, fraud, deceit, or misrepresentation) and 8.4(h) (prohibiting a lawyer
from engaging in conduct that adversely reflects on the lawyer’s fitness to
practice law).     They also submitted eight stipulated exhibits, one of which
contained more than 80 letters commending Streeter’s good character and
reputation in his community. Having considered this evidence and the testimony
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of Streeter and his friend and former counsel, James Marniella, the panel adopted
the parties’ stipulations. Finding a strong similarity between the conduct and
mitigating factors present in this case and those present in Disciplinary Counsel v.
Edwards, 134 Ohio St. 3d 271, 2012-Ohio-5643, 981 N.E.2d 857, the panel felt
constrained to impose the same sanction that we had imposed in that case—a two-
year suspension, all stayed on conditions. The board adopted the panel’s findings
of fact and misconduct and recommended sanction.
       {¶ 4} Relator objects to the board’s recommended sanction, arguing that
the facts of this case distinguish Streeter’s conduct from that of Edwards.
Because Streeter misappropriated more than three times the money that Edwards
did, engaged in a Ponzi-like scheme to conceal his thefts, and did not promptly
own up to his misconduct, relator contends that his conduct warrants an actual
suspension from the practice of law.         Relator suggests that the appropriate
sanction is a two-year suspension, with 18 months stayed on the conditions
recommended by the board.         We adopt the board’s findings of fact and
misconduct, but sustain relator’s objection to the recommended sanction and
suspend Streeter from the practice of law for two years, with 18 months stayed on
the conditions recommended by the board.
                                   Misconduct
       {¶ 5} Streeter testified that after completing law school in 2001, he
became an associate at a law firm focusing on business transactions and probate
matters. Approximately one year later, the firm opened Statewide Title Agency,
Ltd., which at the time of the misconduct was underwritten by Chicago Title
Insurance Company. Streeter handled Statewide’s title work, real estate files, and
closings, while the law-firm partners controlled the company’s spending and
major business decisions. When the law firm dissolved in 2005, one of the
partners took full ownership of Statewide. Streeter continued his employment
with Statewide and later became a partner in the business. After he assumed full

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ownership of the business in 2007, he discovered that it had exceptionally high
overhead and a lot of debt; he began to feel overwhelmed when he realized that he
could not make payroll.
       {¶ 6} The parties stipulated that from February 2010 to May 2011,
Streeter conducted real estate closings for properties sold in Ohio and received
funds from third parties that he was required to hold in escrow and disburse in
accordance with the closing instructions for each transaction. See R.C. 3953.231.
On six occasions, however, he misappropriated those funds. Instead of depositing
them into the trust account that he held for that purpose, he deposited them into
his operating account and used them to cover his personal and business expenses.
With each successive misappropriation, he would repay part or all of the previous
misappropriation to prevent detection. The details of each transaction are set
forth below:

     Checks Intended for Escrow But Deposited Into Operating Account
Date            Payment      Amount        Date        Source of Funds
Received                                  Repaid       for Repayment
2/11/10         Check        $6,911.78     7/19/10     $40,589.43
7/15/10         Check        $40,589.43    8/27/10     $53,814.52
8/24/10         Check        $53,814.52    9/10/10     $53,805.28
9/10/10         Check        $53,805.28    1/21/11     $26,000.00 and
                                                       $48,992.75
12/30/10        Check        $26,000.00    6/9/11      Personal
1/21/11         Check        $48,992.75    6/9/11      Personal
                                          8/3/11       Personal
                                          9/2/11       Personal

       {¶ 7} In early May 2011, Chicago Title discovered that Statewide’s
monthly account reconciliations were delinquent and gave Streeter a deadline of
May 13, 2011, to provide the documents.         A Chicago Title representative
analyzed the records that Streeter provided and discovered that a December 30,

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2010 check for $26,000 and a January 21, 2011 check for $48,992.75 had not
been deposited into Statewide’s escrow account. When questioned by a Chicago
Title representative, Streeter admitted that he had deposited the two checks into
his operating account and spent the funds.       But by February 25, 2011, his
operating account was once again overdrawn.
       {¶ 8} Chicago Title terminated Statewide’s agency relationship on May
16, 2011, after further investigation revealed that Streeter had misappropriated the
four additional checks identified in the table above. At that time, $74,992.75 of
the funds Streeter had misappropriated remained unreimbursed. Streeter repaid
that amount with personal and borrowed funds, making payments of $13,000 and
$26,000 on June 9, 2011, $32,000 on August 3, 2011, and $3,992.75 on
September 2, 2011.
       {¶ 9} Chicago Title reported the misappropriation to relator and local
law-enforcement authorities, but no criminal charges resulted.         The parties
stipulated and the panel and board found that Streeter’s conduct involved
dishonesty, fraud, deceit, or misrepresentation, that it adversely reflected on his
fitness to practice law, and that it therefore violated Prof.Cond.R. 8.4(c) and
8.4(h) as charged in relator’s complaint. We adopt these findings of fact and
misconduct.
                            Recommended Sanction
       {¶ 10} When imposing sanctions for attorney misconduct, we consider
relevant factors, including the ethical duties that the lawyer violated and the
sanctions imposed in similar cases. Stark Cty. Bar Assn. v. Buttacavoli, 96 Ohio
St.3d 424, 2002-Ohio-4743, 775 N.E.2d 818, ¶ 16. We also weigh evidence of
the aggravating and mitigating factors listed in BCGD Proc.Reg. 10(B).
Disciplinary Counsel v. Broeren, 115 Ohio St. 3d 473, 2007-Ohio-5251, 875
N.E.2d 935, ¶ 21.

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       {¶ 11} The parties stipulated and the board found that just one aggravating
factor is present—that Streeter acted with a selfish motive by taking funds that
should have been placed in escrow and using them to operate his business and
avoid laying off his employees. See BCGD Proc.Reg. 10(B)(1)(b).
       {¶ 12} Stipulated mitigating factors adopted by the board include (1) the
absence of prior disciplinary offenses, (2) Streeter’s payment of full restitution,
(3) his cooperation throughout the disciplinary process, and (4) his positive
reputation in the legal and general communities, as demonstrated by more than 80
character letters submitted by Streeter’s friends, family, former clients, and
colleagues. See BCGD Proc.Reg. 10(B)(2)(a), (c), (d), and (e).
       {¶ 13} The parties also submitted a report from Dr. Galit Askenazi, a
board-certified forensic psychologist, who diagnosed Streeter with major
depressive disorder and general anxiety disorder dating back to at least 2005. Dr.
Askenazi states with reasonable psychological certainty that these conditions
contributed to the misconduct at issue in this case. He reports that although
Streeter has ongoing symptoms of depression and anxiety, he participates in
individual and group counseling and is committed to improving his mental health
and overall quality of life. Paul Caimi, associate director of the Ohio Lawyers
Assistance Program (“OLAP”), also reports that Streeter signed a three-year
OLAP contract on September 22, 2011. Pursuant to that contract, he states,
Streeter has actively participated in private and group counseling with OLAP and
Emotions Anonymous and has shown marked improvement in his mental health.
Both Dr. Askenazi and Caimi conclude that Streeter is capable of returning to the
competent and ethical practice of law. Therefore, the board determined that
Streeter’s stipulated mental disability also qualified as a mitigating factor pursuant
to BCGD Proc.Reg. 10(B)(2)(g).
       {¶ 14} At the hearing, Streeter argued that a two-year suspension, all
stayed on conditions, is the appropriate sanction for his misconduct in light of this

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court’s decision in Disciplinary Counsel v. Edwards, 134 Ohio St. 3d 271, 2012-
Ohio-5643, 981 N.E.2d 857. In contrast, relator argued that while the same
mitigating factors are present in this case and Edwards, the cases differ in that
Edwards misappropriated approximately $70,000 from his client trust account,
while Streeter misappropriated more than $230,000. Therefore, relator urged the
board to recommend a two-year suspension, with 18 months stayed on conditions.
       {¶ 15} Finding     that   the   difference   in   the   amount   of   money
misappropriated by Edwards and Streeter was not material, the board stated that it
was constrained from making any recommendation that conflicted with the
Edwards rationale. Therefore, it recommended that Streeter be suspended from
the practice of law for two years, all stayed on the conditions that he continue
with his OLAP contract, extend the present term of that contract if recommended
by OLAP, continue his individual therapy with a treating healthcare professional,
and commit no further misconduct.
              Relator’s Objection to the Recommended Sanction
       {¶ 16} Relator objects to the board’s recommended sanction. He argues
that the fully stayed suspension we imposed in Edwards is an exception to the
general rule that attorney misconduct involving the misappropriation of funds
warrants, at a minimum, an actual suspension from the practice of law. Relator
distinguishes Streeter’s misconduct from that of Edwards based on the sum of
money misappropriated, his selfish motive, his initial mischaracterization of his
misappropriation as accidental when confronted by Chicago Title, and Streeter’s
conscious decision not to report his misconduct and contends that an actual
suspension is therefore necessary in this case.
       {¶ 17} Streeter, on the other hand, contends that Edwards marks a new
and enlightened departure from our earlier precedent that replaces the
presumption of an actual suspension for misconduct involving misappropriation
with a fully stayed suspension for attorneys whose contributing mental disabilities

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                                  January Term, 2014

have been treated and controlled. Our holding in Edwards is not so much a grand
departure from our precedent, however, as it is an application of our past holdings
to the specific facts of that case.
        {¶ 18} Edwards, an attorney who had practiced law for more than 30
years without incident, wrote ten checks—totaling $69,500—to himself from his
client trust account during a 17-month period in 2009 and 2010. Edwards, 134
Ohio St. 3d 271, 2012-Ohio-5643, 981 N.E.2d 857, ¶ 7. The last of those checks
resulted in an $832.34 overdraft of his client trust account. Id. In response to
relator’s letter of inquiry regarding the overdraft, Edwards admitted not only his
responsibility for the overdraft but also disclosed his pattern of misappropriating
client funds. Id.
        {¶ 19} Edwards stipulated that his conduct violated Prof.Cond.R. 1.15(a)
(requiring a lawyer to hold the property of clients in an interest-bearing client
trust account, separate from the lawyer’s own property) and that he consequently
engaged in conduct adversely reflecting on his fitness to practice law, in violation
of Prof.Cond.R. 8.4(h). Edwards at ¶ 8. We also found that his unauthorized
removal of funds from his client trust account and use of those funds for his own
purposes necessarily involved dishonesty in violation of Prof.Cond.R. 8.4(c). Id.
        {¶ 20} We have consistently recognized that because each disciplinary
case presents unique facts and circumstances, we are not limited to the factors
enumerated in the rules, but may consider “all relevant factors” in determining the
appropriate sanction for an attorney’s misconduct. BCGD Proc.Reg. 10(A) and
(B). See also Disciplinary Counsel v. Oberholtzer, 136 Ohio St. 3d 314, 2013-
Ohio-3706, 995 N.E.2d 217, ¶ 29; Disciplinary Counsel v. Doellman, 127 Ohio
St.3d 411, 2010-Ohio-5990, 940 N.E.2d 928, ¶ 45; Cleveland Metro. Bar Assn. v.
Podor, 121 Ohio St. 3d 131, 2009-Ohio-358, 902 N.E.2d 488, ¶ 11; Akron Bar
Assn. v. Markovich, 117 Ohio St. 3d 313, 2008-Ohio-862, 883 N.E.2d 1046, ¶ 19.

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       {¶ 21} Although we begin with the idea that each case is different, we
recognize that there are presumptive sanctions for some common forms of
attorney misconduct. See, e.g., Disciplinary Counsel v. Mathewson, 113 Ohio
St.3d 365, 2007-Ohio-2076, 865 N.E.2d 891, ¶ 19 (“an attorney’s neglect of legal
matters and failure to cooperate in the ensuing disciplinary investigation warrant
an indefinite suspension”); Trumbull Cty. Bar Assn. v. Kafantaris, 121 Ohio St. 3d
387, 2009-Ohio-1389, 904 N.E.2d 875, ¶ 14 (disbarment is the presumptive
sanction for the misappropriation of client funds); Disciplinary Counsel v.
Fowerbaugh, 74 Ohio St. 3d 187, 658 N.E.2d 237 (1995) (“When an attorney
engages in a course of conduct that violates DR 1-102(A)(4) [prohibiting conduct
involving dishonesty, fraud, deceit, or misrepresentation], the attorney will be
actually suspended from the practice of law for an appropriate period of time”).
       {¶ 22} The presumption in favor of a specific sanction may be overcome,
however, if “an abundance of mitigating evidence” warrants a different result.
See, e.g., Disciplinary Counsel v. Markijohn, 99 Ohio St. 3d 489, 2003-Ohio-
4129, 794 N.E.2d 24, ¶ 5, 8 (acknowledging that misconduct involving
dishonesty, fraud, deceit, or misrepresentation usually requires an actual
suspension from the practice of law for an appropriate period of time, but
imposing a six-month fully stayed suspension based on substantial mitigating
evidence).
       {¶ 23} Our decision in Edwards acknowledges that the presumptive
sanction for misappropriation is disbarment, but it also recognizes that that
presumption “may be tempered with sufficient evidence of mitigating or
extenuating circumstances.” Edwards, 134 Ohio St. 3d 271, 2012-Ohio-5643, 981
N.E.2d 857, at ¶ 18, citing Disciplinary Counsel v. Bubna, 116 Ohio St. 3d 294,
2007-Ohio-6436, 878 N.E.2d 632, ¶ 28 (finding that disbarment was unwarranted
for attorney’s misappropriation in view of the applicable mitigating factors);
Dayton Bar Assn. v. Gerren, 103 Ohio St. 3d 21, 2004-Ohio-4110, 812 N.E.2d
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                                January Term, 2014

1280, ¶ 11, 16 (imposing a six-month actual suspension for misappropriation of
client funds in recognition of the fact that the misconduct represented an isolated
incident in an otherwise unblemished career).         Thus, Edwards embodies the
application of our precedent to the facts of the case—not a departure from that
precedent.
       {¶ 24} Just one aggravating factor was present in Edwards—a pattern of
misconduct over a period of one and a half years. But significant mitigating
factors persuaded us that a two-year suspension, all stayed on conditions, would
adequately protect the public from future harm. Edwards at ¶ 19-20. Edwards
had practiced law for more than 30 years without a disciplinary violation. Id. at
¶ 10; BCGD Proc.Reg. 10(B)(2)(a).                He fully cooperated in relator’s
investigation, disclosing the full extent of his misappropriation in response to
relator’s letter of inquiry regarding an $832.34 overdraft of his client trust
account, and acknowledged the wrongful nature of his conduct. Edwards at ¶ 7,
10; BCGD Proc.Reg. 10(B)(2)(d).          In December 2009—approximately ten
months before the bank reported the overdraft of his trust account to relator—
Edwards had used his own money to begin repaying the funds that he had
misappropriated. Edwards at ¶ 7, 11.
       {¶ 25} Edwards also presented evidence that in part because of difficulties
in his marriage, he suffered from adjustment disorder with mixed anxiety and
depressed mood that contributed to his misconduct. Edwards at ¶ 13-14. He gave
most of the funds he had misappropriated to his estranged wife in a misguided
attempt to win her back and reunite his family. Id. at ¶ 12, 14. But with the
assistance of OLAP and individual counseling, he came to understand how his
mental issues had affected his judgment. Id. at ¶ 15. He made positive life
changes and demonstrated that he was capable of returning to the competent,
ethical, and professional practice of law. Id.

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        {¶ 26} We acknowledge that there are many similarities between the facts
in Edwards and the facts at issue in this case. We find, however, that the subtle
yet important differences in Streeter’s conduct warrant an actual suspension from
the practice of law.
        {¶ 27} Like Edwards, Streeter misappropriated funds that he should have
held in a trust account. But in contrast to Edwards, Streeter took affirmative
action to cover up his theft by repaying the money with more misappropriated
money rather than with his own funds. When first confronted with evidence of
his misconduct, he claimed that it was accidental rather than admit any
wrongdoing—let alone the full extent of his wrongdoing. And while he now
freely admits that he misappropriated funds from his trust account, he continues to
minimize the extent of his theft by arguing that his Ponzi-like scheme to repay the
funds resulted in a net misappropriation of just $75,001.99. All told, however, his
misappropriations totaled more than $230,000—more than three times the amount
that Edwards misappropriated.
        {¶ 28} Streeter also emphasizes that he has submitted more than 80 letters
from family, friends, clients, and colleagues attesting to his character, reputation,
integrity, and professionalism, in contrast to the eight letters submitted by
Edwards. While these letters speak to his integrity, professionalism, and concern
for his fellow human beings, some of them expressly deny knowledge of the
specifics of this action, while others refer to his intentional misconduct as a
“mistake,” a “discrepancy,” an “unintentional error,” or the “commingling” of
escrow and operating funds, and others make no reference to the charges against
him. Thus, we are left to question whether the writers fully understood the nature
of Streeter’s admitted misconduct or, in some cases, the purpose for which their
letters were solicited.
        {¶ 29} Perhaps the most important distinction between the conduct of
Edwards and Streeter is the circumstances under which their misappropriations

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                                  January Term, 2014

arose. Edwards was providing increasing financial support to his aging parents
and had advanced over $200,000 of his own funds to cover expenses in some of
his environmental cases. Edwards, 134 Ohio St. 3d 271, 2012-Ohio-5643, 981
N.E.2d 857, at ¶ 14. He became distraught when his wife left him and became
obsessed with winning her back. Edwards at ¶ 14. He began loaning her money
from his client trust account to support her business, convincing himself that this
financial support would encourage her to return to their marriage. Edwards at
¶ 12, 14. These factors suggest that Edwards’s misconduct resulted from the
convergence of several stressful life events, at least some of which were out of his
control.
          {¶ 30} Streeter’s misconduct, in contrast, is the result of a crisis that he
could have avoided, or at the very least minimized, with the exercise of due
diligence. He testified that when he and his business partner decided to amicably
dissolve their relationship, he assumed full ownership of Statewide Title, its
assets, and its liabilities, without making any inquiry into the financial condition
of the business. He admitted that he did not understand the accounting side of the
business, that he did not know what balance sheets or profit and loss statements
were, and that he had no idea how to run a business. Streeter viewed sole
ownership of Statewide as an opportunity to advance his career and proceeded
blindly, without conducting any of the due diligence that one would expect of
someone—especially        an   attorney—entering     into   a   significant   business
transaction.
          {¶ 31} After Streeter assumed sole ownership of Statewide, he realized
that the business was mired in debt for which he was personally responsible and
burdened by high overhead expenses and salaries. With the decline of the real
estate market, he soon recognized that the business was no longer financially
viable.      But rather than lay off employees or shut down, he began

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misappropriating funds from the real estate transactions conducted by Statewide
and using the money to keep the business afloat.
       {¶ 32} Given Streeter’s failure to investigate the business before he
assumed full ownership of Statewide, his decision to misappropriate funds from
his business clients in an effort to rectify his own ill-advised business decisions,
his affirmative acts to cover up his theft, his failure to promptly disclose the full
extent of his wrongdoing, and his ongoing efforts to minimize the extent of his
theft, we find that the facts of this case are substantially different from those of
Edwards. Therefore we sustain relator’s objection to the board’s recommended
sanction and agree that a two-year suspension, with 18 months stayed on the
conditions recommended by the board, is the appropriate sanction for Streeter’s
misconduct.
       {¶ 33} Accordingly, David Allen Streeter Jr. is suspended from the
practice of law in Ohio for two years, with the final 18 months of that suspension
stayed on the conditions that he will extend the term of his OLAP contract if
OLAP so recommends, comply with all of the treatment recommendations made
by OLAP and his treating professionals, and commit no further misconduct.
Costs are taxed to Streeter.
                                                             Judgment accordingly.
       O’CONNOR, C.J., and PFEIFER, O’DONNELL, KENNEDY, FRENCH, and
O’NEILL, JJ., concur.
       LANZINGER, J., concurs in judgment only.
                               ____________________
       Scott Drexel, Disciplinary Counsel, and Joseph M. Caligiuri, Chief
Assistant Disciplinary Counsel, for relator.
       Koblentz & Penvose, L.L.C., Richard S. Koblentz, Bryan L. Penvose, and
Kevin R. Marchaza, for respondent.
                          _________________________

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