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Saturday, March 31, 2012

Attorney Is Suspended for Failure to Honor Fee-Sharing Agreement

Attorney Is Suspended for Failure to Honor Fee-Sharing Agreement
The New York Law Journal by Brendan Pierson  -  March 14, 2012

The Appellate Division, First Department, has suspended attorney David M. Shearer of Shearer & Essner for 2 1/2 years for refusing to honor a fee-sharing agreement in a medical malpractice case with an attorney in Maryland, a lighter punishment than the five-year suspension requested by the Departmental Disciplinary Committee.  The panel in Matter of Shearer, 5824 -307, which consisted of Justices Angela M. Mazzarelli, Richard T. Andrias, Karla Moskowitz, Rosalyn H. Richter and Sallie Manzanet-Daniels, found in a March 13 order that the reduction was warranted because of Mr. Shearer's "unblemished" career, cooperation with the committee and evidence of good character.  The disciplinary proceeding involves a 1998 medical malpractice case. The plaintiff, Margaret Leskinen, had retained Dov Apfel, a Maryland attorney, to represent her in a lawsuit in Bronx Supreme Court over brain damage allegedly suffered by her son Michael during his delivery in 1988.  According to the First Department decision, Mr. Shearer entered into an agreement with Mr. Apfel to act as local counsel. Under the agreement, Mr. Shearer was to file documents to get Mr. Apfel admitted pro hac vice in the Bronx, and the two attorneys would evenly split the legal fees.  Instead, Mr. Shearer filed the case and handled it himself, making no effort to get Mr. Apfel admitted.

In July 2003, the case settled for $4.25 million. Mr. Shearer then told Mr. Apfel he would not pay half of the $574,000 legal fee because Mr. Apfel had not done any work on the case.  In September 2003, Mr. Shearer's firm filed a retainer agreement between the firm and Ms. Leskinen with the Office of Court Administration, claiming it had not been filed earlier because of an administrative error; Ms. Leskinen later testified she never entered into this agreement.  Mr. Apfel petitioned Bronx Supreme Court Justice Bertram Katz for an order compelling payment of the fee, setting off a protracted dispute that eventually reached the Appellate Division, First Department.  In 2005, the First Department ruled that Mr. Apfel was entitled to half of the fee, and remanded the case to Supreme Court for further proceedings on whether Mr. Shearer should be sanctioned for his conduct.  In October 2006, Bronx Supreme Court Justice Betty O. Stinson imposed a $5,000 sanction against Mr. Shearer payable to the Lawyers' Fund for Client Protection and a $10,000 sanction payable to Mr. Apfel (NYLJ, Oct. 20, 2006).  In July 2009, the Departmental Disciplinary Committee filed 14 charges against Mr. Shearer, alleging he submitted documents to the OCA falsely claiming that his firm entered into a retainer agreement directly with Ms. Leskinen, failed to disclose the fee dispute when he sought approval of the settlement in the malpractice case and testified falsely in court, among other charges.  Following a January 2010 hearing, a referee upheld 12 of the 14 charges and recommended that Mr. Shearer be disbarred. A hearing panel upheld the referee's findings, holding that Mr. Shearer had "embarked upon an acrimonious, scorched earth litigation disproportionate to the fee dispute" and made false statements under oath. However, it asked only for a five-year suspension, noting Mr. Shearer's lack of a disciplinary record, the fact that the case was a single incident and the lack of a precedent for disbarment.

The First Department affirmed all 12 charges but one, which alleged improper ex parte communication with the court without notice to "opposing counsel," identified as Mr. Apfel.  "While Apfel's interest in the fee dispute was adverse to respondent's, Apfel was, as found by Justice Stinson and this Court, his 'co-counsel' and thus, cannot also be said to have been an 'opposing party,'" the panel said.  The panel said it was further reducing the punishment in light of various mitigating factors noted by the hearing panel.  "[W]hen balanced against the mitigating factors, respondent's misconduct of testifying falsely before the court, the Committee and the Referee as to the existence of a retainer agreement and making such a claim in documents filed with the court and OCA, improperly notarizing signatures, and seeking an infant's compromise order without informing the court of the fee dispute or giving Apfel or his counsel notice, aggravated by respondent's failure to accept responsibility, warrants the imposition of a two-and-a-half year suspension," the panel wrote.  "In reducing the sanction, we note that despite the number of sustained charges, they arise from a course of conduct in the pursuit of legal fees in one matter in an otherwise unblemished career of an attorney with a good reputation. As conceded by the Committee in urging a five-year suspension rather than the disbarment recommended by the Referee, respondent's misconduct was not directed at his client and did not extend to other matters. His cooperation with the Committee, in the area of document production and admissibility, was 'exemplary' and respondent submitted evidence attesting to his good character." Mr. Shearer is represented by Michael S. Ross. Neither could be reached for comment.  Brendan Pierson can be contacted at bpierson@alm.com.

4 comments:

Anonymous said...

Most lawyers learn pretty quickly that you have to pay the piper. If not, you get slapped, and you will be given another chance- but at a higher rate. It's only about the money.

Anonymous said...

If Shearer was never legally retained by Leskinen, how could he have represented her for all those years, and obtained a settlement and earned fees? As far as Apfel, where was he all that time? Why didn't he do what he needed to do to practice in NY?

What happened to all those laws, rules and regulations that are supposed to govern attorneys?

Why didn't the diciplinary committee go after everyone involved in this including the judge who was overseeing this case?

Anonymous said...

Its always the lawyers that get the short end. Your gonna tell us that his client never in all those years wondered why he or she wasn't dealing with Apfel if he or she never retained Shearer... Doesn't make sense! And like someone said above... why didn't Apfel step up sooner? I mean wasn't he curious as to him getting admitted in NY? I think Shearer got the short end of the deal for certain!

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               Video of 1st Hearing on Court 'Ethics' Corruption
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