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Cite as In re Hendrick, 19 DB Rptr 170 (2005)
conduct be analyzed by considering the following factors: (1) the ethical duty
violated; (2) the lawyer’s mental state; (3) the actual or potential injury; and (4) the
existence of aggravating and mitigating circumstances. Standards, § 3.0.
A. Duty Violated. In violating DR 1-102(A)(4), DR 5-101(A), DR
5-103(B), and DR 6-101(A), the Accused violated duties to his clients, the legal
system, and the profession. Standards, §§ 4.3, 4.5, 6.1, 7.0.
B. Mental State. “Knowledge” is the conscious awareness of the nature or
attendant circumstances of the conduct but without the conscious objective to
accomplish a particular result. “Negligence” is the failure of a lawyer to heed a
substantial risk that circumstances exist or that a result will follow, which failure is
a deviation from the standard of care that a reasonable lawyer would exercise in the
situation. Standards, at 7. The Accused knew that the funds he was loaning were to
be used to financially assist VanCleve to resolve the claims against her. He knew of
his professional and business relationships with Voeller, Fidelity, and the private
investors. The Accused should have known of the conflicts and should have provided
full disclosure and obtained consent from each of his clients. The Accused also knew
he was responsible for and needed to provide competent representation in handling
his clients’ legal matters. The Accused was negligent in recognizing his lack of
experience and understanding of substantive and procedural law and rules in his
representation of the Koppensteins.
C. Injury. The Standards define “injury” as harm to the client, the public,
the legal system, or the profession that results from a lawyer’s conduct. “Potential
injury” is harm to the client, the public, the legal system, or the profession that is
reasonably foreseeable at the time of the lawyer’s conduct, and which, but for some
intervening factor or event, would probably have resulted from the lawyer’s
misconduct. Standards, at 7. The Accused caused injury to the substantive interests
of parties to and the procedural functioning of the State Court Action in the
Koppenstein matter. The State Court Action continued when it should have been
stayed. The Board’s lawyers continued to devote substantial time to the case, and
asserted a counterclaim and prepared motions and memoranda against the
Koppensteins that were filed with the court, which exposed the Board’s lawyers to
potential sanctions for violation of the automatic stay. The Accused also caused
injury and potential injury to the private investors who loaned the Accused a
substantial amount of money. The Accused failed to repay loans he obtained.
Investors were required to pursue the Accused in the bankruptcy court, which led to
an agreement in one case for judgment against the Accused denying dischargability
of the claim and an obligation to repay in excess of $200,000 to the investor over a
period of time through 2016. In another case, the deeds in lieu of foreclosure were
accepted by the investor to reduce the loss sustained by the investor.
D. Aggravating Factors. “Aggravating factors” are considerations that
increase the degree of discipline to be imposed. Standards, § 9.21. The Accused has
substantial experience in the practice of law having been admitted to practice in
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