In re Disciplinary Action against Grigsby, No. A07-688.

CourtSupreme Court of Minnesota (US)
Writing for the CourtPer Curiam
Citation764 N.W.2d 54
PartiesIn re Petition for DISCIPLINARY ACTION AGAINST Stephen Vincent GRIGSBY, a Minnesota Attorney, Registration No. 291973.
Docket NumberNo. A07-688.
Decision Date16 April 2009
764 N.W.2d 54
In re Petition for DISCIPLINARY ACTION AGAINST Stephen Vincent GRIGSBY, a Minnesota Attorney, Registration No. 291973.
No. A07-688.
Supreme Court of Minnesota.
April 16, 2009.

[764 N.W.2d 56]

Martin A. Cole, Director, Timothy M. Burke, Senior Assistant Director, Office of Lawyers Professional Responsibility, St. Paul, for petitioner Office of Lawyers Professional Responsibility.

Stephen Vincent Grigsby, Princeton, pro se respondent.

OPINION

PER CURIAM.


The Office of Lawyers Professional Responsibility charged respondent Stephen Vincent Grigsby with failure to file individual income tax returns, failure to report income, failure to maintain books and records, failure to use written retainer agreements, making misrepresentations to the Director of the Office of Lawyers Professional Responsibility, and noncooperation with the Director. The referee assigned to hear the case concluded that Grigsby violated the Minnesota Rules of Professional Conduct and recommended that Grigsby be suspended for 60 days. The Director appealed the referee's recommendation of a 60-day suspension, arguing for suspension for a minimum of 12 months. Grigsby challenged the referee's recommended discipline as inconsistent with the factual findings and argued for a 30-day suspension. After briefs were filed with this court, Grigsby's lawyer withdrew from the case. We briefly continued oral arguments in the matter to allow Grigsby to obtain counsel. After hearing oral argument from the parties, at which Grigsby appeared pro se, we remanded the matter to the referee for additional findings of fact concerning the redaction of a particular bank statement during the Director's investigation. The referee filed amended findings of fact and conclusions of law but did not change his recommendation of a 60-day suspension. We adopt the referee's recommendation and suspend Grigsby for 60 days.

Grigsby was admitted to practice law in Minnesota in 1999 and since 2000 has been a sole practitioner. Grigsby admits that he had sufficient income in 1999, 2000, 2001, and 2002 to require him to file federal

764 N.W.2d 57

individual income tax returns. See 26 U.S.C. § 6012(a)(1)(A) (2000). Nevertheless, Grigsby did not file his federal tax returns for those years until April 2004, after the Director requested copies. Grigsby's 2002 federal individual tax return reported gross receipts of $18,068, although the referee found that Grigsby advised the Director that he received nonrefundable client retainers during 2002 totaling $47,100. Grigsby's 2003 individual tax return reported gross receipts of nearly $78,000, although the referee found Grigsby advised the Director that he received client retainers during 2003 totaling $127,050.

During 2002 and 2003, Grigsby requested and received retainers for the representation of clients in pending criminal matters. On three occasions pertinent here, the retainers were deposited into either Grigsby's personal checking account or into the business checking account of attorney K.B., from whom Grigsby leased office space, rather than into a client trust account. See Minn. R. Prof. Conduct 1.15(c)(5) (requiring that fees received in advance of the legal services being performed be deposited into a trust account and withdrawn as earned, unless the lawyer and the client have entered into a written fee agreement making the advance payment nonrefundable). In none of the representations was there a written fee agreement, and Grigsby kept few, if any, records of the receipts. All three clients complained to the Director about Grigsby's representation.

In particular, around March 2002, Grigsby was retained to represent client M in a pending criminal matter. Grigsby requested a $10,000 retainer, which was deposited by wire transfer into the business checking account of attorney K.B. Grigsby did not transfer the retainer to a client trust account. Client M pleaded guilty in May 2002. In November 2002, Grigsby refunded $2,000 of the retainer to M's sister-in-law.

Client M complained to the Director of the Office of Lawyers Professional Responsibility, although the nature of the complaint is not apparent from this record. In responding to the Director's investigation of the complaint, Grigsby was represented by attorney Edward Kautzer. In April 2003, the Director's office inquired of Kautzer, "Did Mr. Grigsby receive $10,000 to represent [client M]?" and asked for "all documents that refer or relate to [Grigsby's response]." Kautzer responded on Grigsby's behalf that "the only documents that exist would be that resulted from the wire transfer of the money." In a second letter, Kautzer further responded that Grigsby had "deposited the $10,000 in his business checking account at Wells Fargo." Kautzer enclosed with that second letter a bank statement showing receipt of a $10,000 wire transfer. However, all other information had been redacted from the bank statement, including the identity of the account holder.

In reality, the retainer for representation of client M had been wired to the business account of attorney K.B., because at the time Grigsby had neither a client trust account nor a business account for his practice. The referee found that Kautzer's statement that Grigsby "had deposited the $10,000 in his business checking account" was false. Nevertheless, when the Director demanded production of "the original bank statements, check registers, and cancelled checks sufficient to establish the receipt of the claimed earned fee payment for the representation of [client M]," Kautzer responded that he was "in the process of locating those documents." After another month went by, Kautzer wrote to the Director that Grigsby "has no other documents which are responsive to" the

764 N.W.2d 58

Director's request. Kautzer indicated that Grigsby "would be happy to" sign a release so that the Director could obtain the requested information directly from the bank, although the effect of a release signed by Grigsby, who was not the accountholder, is unclear. The referee originally found that Grigsby's claim to have deposited the retainer in his business checking account, coupled with the failure to disclose that the accountholder was actually K.B., "was misleading, for it led to the belief that the bank statement was for [Grigsby's] account."

Not until April 2004, nearly nine months after the production of the redacted statement from the business account of attorney K.B., did Kautzer tell the Director that the retainer for the representation of client M had been wired into K.B.'s account "as Mr. Grigsby did not have his own account at that time." But Kautzer did not produce, with that letter, a copy of the unredacted bank statement for K.B.'s business account showing receipt of the wire transfer.

There was a similar lack of candor with respect to other requests for information. In November 2003, the Director requested information and documents concerning Grigsby's representation of Client A, for which Grigsby had been paid at least half of a $20,000 retainer. The Director asked Grigsby to identify the account into which the retainer had been deposited and to provide documentation sufficient to establish receipt. Kautzer, on Grigsby's behalf, told the Director that Grigsby "does not believe" that the retainer was deposited, and further told the Director that there were no documents in Grigsby's possession regarding the transaction. In reality, Grigsby had deposited $10,000 of the retainer into his personal account, but had not kept any bank statements or check registers with respect to the account and no records whatsoever of receipt of the balance of the retainer. The Director later asked whether Grigsby maintained a cash receipts journal for 2002 or 2003. Kautzer, on Grigsby's behalf, told the Director that Grigsby "maintained a log of payments he received during 2002." This statement was also false; the referee found Grigsby had no payments log for 2002.

There were also delays in the production of Grigsby's income tax returns. The Director first requested copies in March 2004; the returns were not produced until October 2004, and then only after three reminders from the Director's office.

On April 2, 2007, the Director filed a petition for disciplinary action, charging Grigsby with failure to file individual income tax returns, failure to report all of his income on returns that were filed, failure to maintain practice-related books and records, failure to use written retainer agreements, and failure to cooperate with and making false statements during the Director's investigation. We appointed the Honorable Warren E. Litynski to act as referee, and a hearing was held before the referee on July 17, 2007.

The referee filed his Findings of Fact, Conclusions of Law, and Recommendation for Discipline on September 20, 2007. The referee concluded that Grigsby's failure to timely file state and federal tax returns violated Minn. R. Prof. Conduct 8.4(b) and (d).1 The referee further concluded that Grigsby's failure to report income on those returns violated Minn. R. Prof. Conduct

764 N.W.2d 59

8.4(c).2 The referee concluded that Grigsby's failure to maintain practice-related books and records violated Minn. R. Prof. Conduct 1.15(h)3 and Grigsby's failure to use written retainer agreements violated Minn. R. Prof. Conduct 1.15, as further interpreted by Lawyers Professional Responsibility Board Opinion 15.4 Finally, the referee concluded that Grigsby's misrepresentations to the Director and failure to cooperate with the Director's investigation violated Minn. R. Prof. Conduct 8.1(a)(1) and (3),5 8.4(c) and (d),6 and Rule 25, Rules on Lawyers Professional Responsibility (RLPR).7 The referee recommended that Grigsby be suspended for 60 days.

The Director filed a brief challenging the referee's recommendation of a 60-day suspension, asking us to instead suspend Grigsby for a minimum of one year. Grigsby's brief also...

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29 practice notes
  • Hoffman v. Northern States Power Co., No. A06-2275.
    • United States
    • Supreme Court of Minnesota (US)
    • April 16, 2009
    ...the scope of NSP's obligations under the tariff "is best suited for a first consideration by the MPUC." As a result of the ambiguity, the 764 N.W.2d 54 certified question of whether the claim for injunctive relief is barred by the filed rate doctrine is not ripe for determination by this co......
  • In re MacDonald, A16-1282
    • United States
    • Supreme Court of Minnesota (US)
    • January 17, 2018
    ...MacDonald's testimony, supports these allegedly omitted facts, there is no clear error in the referee's findings. See In re Grigsby , 764 N.W.2d 54, 60–61 (Minn. 2009) (holding that it was not clear error for the referee to "fail[ ] to make the requested findings" in part because there was ......
  • In re Petition for Disciplinary Action Against Butler, No. A14–0834.
    • United States
    • Supreme Court of Minnesota (US)
    • August 12, 2015
    ...cumulative weight of the disciplinary violations; (3) the harm to the public; and (4) the harm to the legal profession.” In re Grigsby, 764 N.W.2d 54, 62 (Minn.2009). We look to similar cases for guidance in deciding what discipline to impose, but we ultimately determine the appropriate dis......
  • In re Bonner, A15-1813
    • United States
    • Supreme Court of Minnesota (US)
    • May 31, 2017
    ...that cooperation with criminal and disciplinary proceedings is required by the rules and is not a factor for mitigation); In re Grigsby , 764 N.W.2d 54, 61 (Minn. 2009) (same); In re Moulton , 721 N.W.2d 900, 906 (Minn. 2006) (same). Because cooperation with the Director and compliance with......
  • Request a trial to view additional results
29 cases
  • Hoffman v. Northern States Power Co., No. A06-2275.
    • United States
    • Supreme Court of Minnesota (US)
    • April 16, 2009
    ...the scope of NSP's obligations under the tariff "is best suited for a first consideration by the MPUC." As a result of the ambiguity, the 764 N.W.2d 54 certified question of whether the claim for injunctive relief is barred by the filed rate doctrine is not ripe for determination by this co......
  • In re MacDonald, A16-1282
    • United States
    • Supreme Court of Minnesota (US)
    • January 17, 2018
    ...MacDonald's testimony, supports these allegedly omitted facts, there is no clear error in the referee's findings. See In re Grigsby , 764 N.W.2d 54, 60–61 (Minn. 2009) (holding that it was not clear error for the referee to "fail[ ] to make the requested findings" in part because there was ......
  • In re Petition for Disciplinary Action Against Butler, No. A14–0834.
    • United States
    • Supreme Court of Minnesota (US)
    • August 12, 2015
    ...cumulative weight of the disciplinary violations; (3) the harm to the public; and (4) the harm to the legal profession.” In re Grigsby, 764 N.W.2d 54, 62 (Minn.2009). We look to similar cases for guidance in deciding what discipline to impose, but we ultimately determine the appropriate dis......
  • In re Bonner, A15-1813
    • United States
    • Supreme Court of Minnesota (US)
    • May 31, 2017
    ...that cooperation with criminal and disciplinary proceedings is required by the rules and is not a factor for mitigation); In re Grigsby , 764 N.W.2d 54, 61 (Minn. 2009) (same); In re Moulton , 721 N.W.2d 900, 906 (Minn. 2006) (same). Because cooperation with the Director and compliance with......
  • Request a trial to view additional results

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