Court Opinion

ID: 2681515
Source: CourtListenerOpinion
Date Created: 2014-07-01 13:02:47.174236+00
Date Added: 2024-06-11T13:12:09.886020
License: Public Domain

2014 WI 48

                  SUPREME COURT          OF   WISCONSIN
CASE NO.:               2013AP2685-D
COMPLETE TITLE:         In the Matter of Disciplinary Proceedings
                        Against Geneva E. McKinley, Attorney at Law:

                        Office of Lawyer Regulation,
                                  Complainant,
                             v.
                        Geneva E. McKinley,
                                  Respondent.

                           DISCIPLINARY PROCEEDINGS AGAINST McKINLEY

OPINION FILED:          July 1, 2014
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
   COURT:
   COUNTY:
   JUDGE:

JUSTICES:
   CONCURRED:
   DISSENTED:
   NOT PARTICIPATING:

ATTORNEYS:
                                                                           2014 WI 48
                                                                   NOTICE
                                                     This opinion is subject to further
                                                     editing and modification.   The final
                                                     version will appear in the bound
                                                     volume of the official reports.
No.        2013AP2685-D

STATE OF WISCONSIN                               :            IN SUPREME COURT

In the Matter of Disciplinary Proceedings
Against Geneva E. McKinley, Attorney at Law:

Office of Lawyer Regulation,                                            FILED
               Complainant,
                                                                    JUL 1, 2014
       v.
                                                                      Diane M. Fremgen
                                                                   Clerk of Supreme Court
Geneva E. McKinley,

               Respondent.

       ATTORNEY       disciplinary        proceeding.      Attorney's          license

suspended.

       ¶1      PER CURIAM.       We review a stipulation filed pursuant

to    SCR    22.121   by   the   Office   of   Lawyer     Regulation       (OLR)     and

       1
           SCR 22.12 states as follows:        Stipulation.

            (1) The director may file with the complaint a
       stipulation of the director and the respondent to the
       facts, conclusions of law regarding misconduct, and
       discipline to be imposed.     The supreme court may
       consider the complaint and stipulation without the
       appointment of a referee.
                                                                No.     2013AP2685-D

Attorney    Geneva   E.    McKinley.        In    the   stipulation,         Attorney

McKinley admits that she pled no contest to and was convicted of

two misdemeanor counts of filing a tax return that she believed

was   not    true    and    correct,       in     violation    of      Wis.     Stat.

§ 71.83(2)(a)2.      She further admits that the conduct underlying

these two convictions constituted violations of SCR 20:8.4(b).

The   stipulation     requests    this          court   to    impose     a     60-day

suspension of Attorney McKinley's license to practice law in

Wisconsin as discipline for the admitted misconduct.                         There is

no request for a restitution award or the imposition of any

conditions on the reinstatement of Attorney McKinley's license.

      ¶2    After closely reviewing this matter, we approve the

stipulation and suspend Attorney McKinley's license to practice

law in this state for a period of 60 days.               We do not impose any

restitution obligation.       Because this matter was resolved with a

stipulation under SCR 22.12, we do not require Attorney McKinley

to pay any of the costs of this proceeding.

      ¶3    Attorney McKinley was admitted to the practice of law
in this state in April 1996.       According to the transcript of the

           (2) If the supreme court approves a stipulation,
      it shall adopt the stipulated facts and conclusions of
      law and impose the stipulated discipline.

           (3) If the supreme court rejects the stipulation,
      a referee shall be appointed and the matter shall
      proceed as a complaint filed without a stipulation.

           (4) A stipulation rejected by the supreme court
      has no evidentiary value and is without prejudice to
      the respondent's defense of the proceeding or the
      prosecution of the complaint.

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                                                                                No.     2013AP2685-D

plea and sentencing hearing in the criminal action, which was

filed in this matter in connection with the stipulation, during

much of the time relevant to the acts at issue in this matter

she       maintained       a    solo    law    practice,         in     which     she     accepted

appointments from the Office of the State Public Defender and

represented private clients.                   In March 2007 she began employment

as    a    full-time       court       commissioner            for    the   Milwaukee       County

circuit court.            As a result of the convictions described in this

opinion,       she    is       no   longer     a       court    commissioner.             Attorney

McKinley       has    never         before    been       the    subject     of        professional

discipline.

          ¶4   The state initially filed a criminal complaint against

Attorney McKinley in June 2011, alleging that she had committed

two felony counts of filing false or fraudulent tax returns, in

violation of Wis. Stat. § 71.83(2)(b)1.                              Those charges required

proof that the filing of the false tax returns had been done

"with intent to defeat or evade" the payment of state income

taxes.         The criminal complaint alleged that Attorney McKinley
had underreported her income on her 2006 and 2007 state income

tax   returns        by    a    total    of    more      than        $117,000    and     that   the

estimated benefit of the underreporting on both her federal and

state tax returns had been slightly less than $33,000.                                          The

prosecutor representing the state explained at the sentencing

hearing that Attorney McKinley had failed to report income from

certain private pay clients and from the rental of a commercial

building       she    owned.           She    also      carried       forward     improper      net

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                                                                                       No.     2013AP2685-D

business         losses       from      her        2006      return       that     resulted          in   the

underreporting of income on her 2007 state income tax return.

       ¶5        After       a    lengthy          pretrial         stage,        Attorney          McKinley

reached      a    plea       agreement            with       the    state.        According          to   the

prosecutor            representing            the    state,             because    of        some     issues

regarding a couple of the state's witnesses that were unrelated

to    the    substance            of    their       testimony            but    might    impact        their

credibility, the state agreed to file an amended information.

The amended information changed the applicable tax years for the

charges from 2006 and 2007 to 2005 and 2006.                                            The prosecutor

explained that the income not reported on the 2005 state income

tax   return          was,       as    in    2006,       attorney         fees    paid       to     Attorney

McKinley         by    a    number       of       private         pay    clients.        Although         the

prosecutor did not indicate that the original charge for the

2007 tax return had been inaccurate in any regard, the amended

information           no     longer         contained         a    charge       regarding         that    tax

year.

       ¶6        The       other            substantial             change        in     the         amended
information           was     that          the    charges         were        reduced       from     felony

offenses to misdemeanors.                         Instead of charging Attorney McKinley

with filing false or fraudulent tax returns with the intent to

evade       or    defeat         the        assessment         of       state     income       taxes,      in

violation of Wis. Stat. § 71.83(2)(b)1, the state now charged

Attorney         McKinley         with       simply          making      and     subscribing          a   tax

return that she did not believe to be true and correct in every

material matter, in violation of Wis. Stat. § 71.83(2)(a)2.                                               The

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                                                                         No.     2013AP2685-D

misdemeanor charges did not include the element of intending to

evade or defeat the payment of state income taxes.

       ¶7   Attorney        McKinley        pled     no     contest        to        the    two

misdemeanor   counts        alleged    in    the     amended        information.            The

circuit court accepted her pleas and found her guilty of those

two    offenses.      Prior     to     sentencing,          Attorney       McKinley         was

allowed an opportunity to address the court.                              She expressed

shame and remorse for her conduct, as well as a willingness to

seek treatment/counseling.

       ¶8   The      circuit        court         agreed      with        the         state's

recommendation to withhold sentence and place Attorney McKinley

on    probation.       It     did     not        follow,     however,          the    state's

recommendation for two years of probation, with six months of

jail time as a condition of probation.                        Instead, the circuit

court required Attorney McKinley to spend only five days in the

county jail over the 2013 Thanksgiving weekend as a condition of

her   probation.       It    also     set    the    period     of     probation        at    18

months, which could be reduced to one year if Attorney McKinley
underwent    eight    sessions        of    grief     counseling          or     individual

counseling.       Finally, the circuit court required as a condition

of    probation    that     Attorney       McKinley        obtain    a    mental       health

assessment and follow up with any treatment recommendations that

resulted from that assessment.

       ¶9   The    circuit     court        commented       during       its     sentencing

statement that it did not believe that Attorney McKinley would

have intentionally endangered her job, her law license, and her
reputation to save a few thousand dollars in taxes.                              The court
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                                                                 No.   2013AP2685-D

indicated that it believed there were other factors that had led

Attorney McKinley to fail to report certain amounts of income—

the illness and death of her mother and a serious depression

that corresponded with the time period of her misconduct.

    ¶10   By the time of Attorney McKinley's sentencing, she had

already made a $9,000 payment to the Wisconsin Department of

Revenue, which was equal to or near the amount of back taxes

owed for the 2005, 2006 and 2007 tax years.2                      Following her

sentencing,         Attorney      McKinley       timely      self-reported      her

convictions to the OLR.

    ¶11   As noted at the beginning of this opinion, Attorney

McKinley has stipulated with the OLR that she has been convicted

of the two misdemeanors described above, and that her conduct

leading   to        those      convictions       constituted     violations      of

SCR 20:8.4(b).         In   the   stipulation,      Attorney    McKinley     agrees

with the OLR's position that a 60-day suspension of her license

to practice law in Wisconsin would be an appropriate level of

discipline     to    impose     in   response     to   her    misconduct.       The
stipulation clearly states that it was not the result of plea

bargaining,     and    that     Attorney       McKinley   has   acceded    to   the

factual allegations, legal conclusions, and level of discipline

sought by the OLR.

    2
       At the time of sentencing, there were still unresolved
issues regarding the amount of interest and penalties that
Attorney McKinley owed to the state as a result of her
underreporting of income.

                                           6
                                                                                No.    2013AP2685-D

     ¶12      The stipulation contains a number of representations

by Attorney McKinley.                She states that she fully understands the

misconduct        allegations          against        her    and     her   right      to    contest

those allegations.               She nonetheless admits her misconduct and

assents to the discipline sought by the OLR.                               She further states

that she fully understands the ramifications that will follow if

this court accepts the stipulation and imposes the requested

level of discipline.                 Attorney McKinley also represents that she

understands her right to consult with counsel in this matter.

Finally, she asserts that her entry into the stipulation is made

knowingly and voluntarily.

     ¶13      There    is       no    dispute     that        Attorney       McKinley's       state

income tax returns for the relevant years contained information

that was not true and that Attorney McKinley did not believe to

be true.          That is clearly sufficient for this court to find a

violation of SCR 20:8.4(b).

     ¶14      The only real issue here is whether the stipulated

level   of    discipline         (a     60-day        suspension)          is    an   appropriate
level   of    discipline.              In   its       memorandum        in      support     of    the

stipulation, the OLR states that it most closely considered four

precedents in analyzing what level of discipline it would seek

in   this     matter:            Public        Reprimand        of     William        J.    Grogan,

No. 2007-6 (consensual public reprimand for conduct including

failing      to    file    timely        state        and    federal       tax      returns      over

several      years        and        failing     to         cooperate        with     the     OLR's

investigation); In re Disciplinary Proceeding Against Lex, 2000
WI 49, 235 Wis. 2d 381, 611 N.W.2d 456 (public reprimand imposed
                                                  7
                                                                        No.    2013AP2685-D

on    attorney      with    prior   public        reprimand    for   his      intentional

failure to file income tax returns for several years; attorney

had experienced financial and professional hardships at time of

misconduct         and    had   completed         agreement    to    pay      all    taxes,

penalties, and interest); In re Disciplinary Proceedings Against

May, 215 Wis. 2d 456, 576 N.W.2d 544 (1998) (60-day suspension

imposed      on    attorney     with    previous      private    reprimand          who   was

criminally charged with failing to file timely state income tax

returns      for     13    years,      ultimately      pled    no    contest        to    two

misdemeanor counts, and received probation); In re Disciplinary

Proceedings Against Thomas, 187 Wis. 2d 332, 522 N.W.2d 781

(1994) (60-day suspension imposed on attorney for intentionally

and repeatedly failing to file state and federal tax returns).

The    OLR    acknowledges       that       these    four     matters      involved       the

failure to file tax returns, either at all or on a timely basis,

while Attorney McKinley's conduct consisted of filing a false

tax return.          Nonetheless, it asserts that Attorney McKinley's

misconduct was similar to that of Attorney Thomas and Attorney
May.     In particular, it emphasizes that both Attorney May and

Attorney McKinley were convicted of two misdemeanors for their

tax-related misconduct.

       ¶15    In addition to prior precedent, the OLR states that it

took    into       consideration        a    number     of     mitigating           factors,

including the lack of any prior discipline, Attorney McKinley's

depression and personal problems, her timely effort to pay the

back taxes, her timely report of her conviction, her complete
disclosure of her conduct to the OLR, and her expressions of
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                                                                        No.     2013AP2685-D

remorse      for    her    conduct.      On       the   other   hand,    the     OLR     also

acknowledged        the    financial     benefit        to   Attorney         McKinley    of

underreporting her income as an aggravating factor.

       ¶16    The OLR's memorandum fails to acknowledge that this

court has also on a substantial number of occasions imposed much

more    severe        discipline       in         cases      involving         tax-related

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

Phillips, 2007 WI 63, 301 Wis. 2d 33, 732 N.W.2d 17 (three-year

suspension imposed on attorney convicted of willful attempted

federal tax evasion for concealing the proceeds of a loan so

that it could not be attached by the Internal Revenue Service);

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 and defeat the payment

of a large portion of her federal income taxes by not reporting

over $90,000 in income in one tax year; evidence also showed

similar conduct in two other tax years).

       ¶17    We recognize, however, that the convictions against
Attorney Phillips and Attorney Washington involved the element

of attempting to evade or defeat the payment of income taxes.

While     the      state    originally      charged       Attorney       McKinley        with

offenses that included this same element, it ultimately agreed

to lesser charges of filing tax returns that Attorney McKinley

knew to be false or inaccurate.                   Consequently, we must base our

determination on the offenses that have been admitted in the

criminal case because neither the state in the criminal case nor
the OLR in this disciplinary proceeding has obtained a finding
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                                                                              No.     2013AP2685-D

from a trier of fact that Attorney McKinley attempted to evade

the    payment        of    state     income   taxes.            Thus,      the    Phillips      and

Washington matters are not directly analogous with respect to

the proper sanction.

       ¶18       Of greater assistance in resolving this case is our

discussion           of    Attorney    Jeffrey        Elverman's         failure      to    report

$230,000 in income from co-trustee fees on his state and federal

income       tax      returns       for   five        years.           In    re     Disciplinary

Proceeding Against Elverman, 2008 WI 28, 308 Wis. 2d 524, 746
N.W.2d 793.             Importantly,     in    that          decision     we     divided      our

analysis of Attorney Elverman's failure to report the trustee

fee    income        into    two    categories.            In    the    first      three    years,

Attorney Elverman claimed that he had simply forgotten to report

the trustee fees as income.                We stated that if this had been the

only misconduct at issue, we might have been more inclined to

impose       a     public     reprimand,         in    line       with       Lex     and    In    re

Disciplinary Proceedings Against Young, 2006 WI 109, 296 Wis. 2d
36, 718 N.W.2d 717.                 Elverman, 308 Wis. 2d 524, ¶48.                        For the
last two years at issue, however, Attorney Elverman admitted

that he knew he was supposed to report the trustee fees as

income, but deliberately chose not to do so in order to pay

other personal financial obligations.                            Id.        We concluded that

this    was      a    more    serious     level       of   misconduct         that    moved      the

matter on the continuum of culpability more toward what had

occurred in Phillips and Washington.                        Consequently, we suspended

Attorney Elverman's license for a period of nine months.                                         Id.,
¶¶49-50.
                                               10
                                                                        No.    2013AP2685-D

    ¶19     Similarly, Attorney McKinley did not simply fail to

file her tax returns, as was the situation in the Grogan and Lex

matters cited by the OLR. She was convicted of filing state

income tax returns that she believed were not true or correct,

which appears to be a more serious offense.                       On the other hand,

she was not convicted of attempted tax evasion, as were Attorney

Phillips and Attorney Washington.                      Without more, these facts

would   seem      to    call   for    a   suspension        of   more   than    a    couple

months.

    ¶20     There is more in this case, however.                       Although the OLR

could     have    provided      more      information        about      the    impact     of

Attorney     McKinley's        depression         on    her      misconduct         in   the

stipulation or in its statement in support of the stipulation,

the OLR is clearly taking Attorney McKinley's depression into

account as a mitigating factor in the level of discipline it is

seeking.         There is some discussion of the depth of Attorney

McKinley's       depression      in       the    transcript       of    the    plea      and

sentencing hearing in the criminal case that has been filed in
connection       with    the   stipulation.            We    factor     that    into     our

analysis.        In addition, Attorney McKinley has never before been

the subject of professional discipline.                          When her failure to

report all of her income came to light, she made timely efforts

to pay the back taxes that she owed and she expressed remorse

for her misconduct.

    ¶21     In light of these mitigating factors, we accept the

stipulation and impose the jointly requested sanction of a 60-
day suspension of Attorney McKinley's license to practice law in
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                                                           No.    2013AP2685-D

this state.      We are confident that Attorney McKinley recognizes

the seriousness of her misconduct.             Filing tax returns that a

person   knows   or   believes   are    not   true   because   they    do   not

include all of a person's income is a grave matter.                   Attorney

McKinley's criminal convictions and the resulting loss of her

job have demonstrated that fact.            The suspension of her license

to practice law in this state, even though tempered in this

instance because of mitigating factors, is a further indication

that such conduct carries serious consequences.

    ¶22    We do not impose any restitution in this matter.                  In

addition, because this matter was resolved with the filing of a

stipulation under SCR 22.12 and without the appointment of a

referee, we also do not require Attorney McKinley to pay any

costs.

    ¶23    IT IS ORDERED that the license of Geneva E. McKinley

to practice law in Wisconsin is suspended for a period of 60

days, effective July 31, 2014.

    ¶24    IT IS FURTHER ORDERED that Geneva E. McKinley shall
comply with the provisions of SCR 22.26 concerning the duties of

a person whose license to practice law in Wisconsin has been

suspended.

    ¶25    IT    IS   FURTHER    ORDERED      that   compliance   with      all

conditions of this order is required for reinstatement.                     See

SCR 22.28(2).

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    No.   2013AP2685-D

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