Talley v. Bd. of Prof'l Responsibility
| Decision Date | 26 October 2011 |
| Docket Number | No. W2010–02072–SC–R3–BP.,W2010–02072–SC–R3–BP. |
| Citation | 358 S.W.3d 185 |
| Parties | Mark D. TALLEY v. BOARD OF PROFESSIONAL RESPONSIBILITY. |
| Court | Tennessee Supreme Court |
OPINION TEXT STARTS HERE
Ted I. Jones, Memphis, Tennessee, for the appellant, Mark D. Talley.
Randall J. Spivey, Disciplinary Counsel, Nashville, Tennessee, for the appellee, Board of Professional Responsibility.
JANICE M. HOLDER, J., filed a separate concurring opinion.
This appeal involves a disciplinary proceeding against a Memphis lawyer who pleaded guilty in the Criminal Court for Shelby County to facilitating the felonious violation of the Tennessee Securities Act. After a Board of Professional Responsibility hearing panel recommended that he be disbarred, the lawyer filed a petition for writ of certiorari in the Chancery Court for Shelby County seeking judicial review of the hearing panel's decision. The trial court affirmed the recommendation of the hearing panel, and the lawyer appealed to this Court. On appeal, the Board of Professional Responsibility asserts that the lawyer's petition should be dismissed because his petition for writ of certiorari did not contain the recitation required by Tenn.Code Ann. § 27–8–106 (2000). For his part, the lawyer asserts that the punishment of disbarment is excessive. We have determined that the lawyer's deficient petition for writ of certiorari does not prevent the courts from reviewing the hearing panel's decision. We have also determined that the record fully supports the hearing panel's findings and that disbarring the lawyer is not an excessive punishment in light of the facts and circumstances of this case.
Mark D. Talley is a lawyer practicing in Memphis who was licensed to practice law in 1984. In 2000, he was one of a number of persons indicted by a federal grand jury in the Northern District of Florida for conduct relating to a ponzi scheme involving Luxor Capital Markets Group (“Luxor”). Luxor was a Tennessee corporation, and Mr. Talley had been retained by Luxor to act as an “escrow agent.” Approximately $1,000,000 of investors' money passed through Mr. Talley's trust account and was allegedly disbursed in a manner inconsistent with representations to the investors.
Mr. Talley was acquitted of all charges, following a six-week trial in the United States District Court for the Northern District of Florida. However, shortly after the trial, a lawyer representing the receiver of one of the corporations affiliated with Luxor filed a complaint against Mr. Talley with the Board of Professional Responsibility (“Board”) regarding Mr. Talley's conduct as Luxor's “escrow agent.” On October 29, 2001, disciplinary counsel filed a petition for discipline alleging that Mr. Talley had violated Tenn. Sup.Ct. R. 8, DR–102(A)(1)–(6), DR 2–110(B)(2), DR–102(A)(7) & (8), –102(B)(1), and DR–9–102(A) & (B) in the course of his work with Luxor.
Mr. Talley retained counsel and, on July 28, 2005, entered a conditional guilty plea in which he admitted that he had violated Tenn. Sup.Ct. R. 8, DR–1–102(A)(1), –102(A)(6) and DR 9–102(A) & (B). Mr. Talley agreed to be suspended from the practice of law “for five (5) years plus an indefinite suspension (until restitution is made) with all time suspended except for six months [ (180 days) ] beginning January 1, 2006, with all remaining time to be served on probation.” He also agreed to repay Mr. and Mrs. Michael Thornton $170,000 by making “monthly payments ... in an amount equal to 10% of his gross income from all sources until restitution ... is paid in full.”
On November 7, 2005, this Court entered an order of enforcement with regard to the matters included in Mr. Talley's conditional guilty plea. The order suspended Mr. Talley from the practice of law for five years plus an indefinite suspension until he repaid the Thorntons $170,000. The order expressly required Mr. Talley to pay the Thorntons “10% of his gross income from all sources” until all the restitution had been paid. The order also directed Mr. Talley to pay the costs of the disciplinary proceeding.
While the disciplinary complaint against Mr. Talley stemming from his activities on behalf of Luxor was pending, Mr. Talley was employed as an attorney with Allstate Financial Corporation (“Allstate Financial”). Mr. Talley described Allstate Financial as being in the “factoring business” that was part of a “covered call strategy joint venture.” On August 25, 2005, less than one month after the entry of his conditional guilty plea with the Board stemming from his activities with Luxor, Mr. Talley was indicted by a Shelby County grand jury for his activities as an employee of Allstate Financial. The indictment alleged that Mr. Talley was guilty of one count of conspiracy to commit theft of property over the value of $60,000, four counts of Tennessee Securities Act violations, six counts of theft of property over the value of $60,000, two counts of theft of property over the value of $10,000, and one count of theft of property over the value of $1,000.00. Mr. Talley's attorney informed the Board that Mr. Talley had been indicted.
On December 19, 2005, disciplinary counsel filed a petition for discipline against Mr. Talley based on his work on behalf of Allstate Financial. Citing the charges in the indictments against Mr. Talley, the petition alleged that Mr. Talley had violated Tenn. Sup.Ct. R. 8, RPC 1.15 and RPC 8.4(a)–(d). While Mr. Talley filed an answer to the petition on January 13, 2006, he apparently failed to respond to repeated discovery requests and attempts to set the matter for a hearing.
One of the Board's hearing panels conducted a hearing by telephone on May 8, 2007. In an order filed on May 25, 2007, the hearing panel found that the allegations in the petition for discipline would be “take[n] as confessed” because of Mr. Talley's failure to respond to the discovery requests and efforts to set the petition for a hearing. The hearing panel concluded that Mr. Talley had violated “DR 8.4 and DR 1.15.” After finding two aggravating circumstances 1 and no mitigating circumstances, the hearing panel determined that Mr. Talley should be disbarred. In accordance with Tenn. Sup.Ct. R. 9, § 1.3, Mr. Talley filed a petition for writ of certiorari in the Chancery Court for Shelby County seeking judicial review of the hearing panel's decision.
On December 12, 2007, while the proceedings to review the hearing panel's decision were pending, Mr. Talley pleaded guilty in the Criminal Court for Shelby County to a misdemeanor of “facilitation, to wit, violation of securities law” and accepted a suspended sentence of eleven months and twenty-nine days. By agreement, the sentencing court placed Mr. Talley on probation for eleven months and twenty-nine days, fined him $500 and costs, and ordered him to perform one hundred hours of community service work.
On July 22, 2009, the trial court in which Mr. Talley's petition seeking judicial review of the hearing panel's May 25, 2007 order was pending filed an order vacating the hearing panel's judgment and remanding the matter to the hearing panel for further proceedings. On the same day, the Board's chair appointed a new hearing panel and directed the hearing panel to conduct another hearing and to report its findings within fifteen days following that hearing.
The second hearing panel conducted a hearing on January 15, 2010. Mr. Talley testified at this hearing. The panel filed its findings and recommendations on January 27, 2010. It found:
(1) that Mr. Talley had acted as counsel for Allstate Financial;
(2) that Mr. Talley and other principals of Allstate Financial had been indicted on August 25, 2005 for
conspiracy to commit theft of property over $60,000, ... employing “a device, scheme or artifice to defraud investors in connection with the offer, sale or purchase of a security, to wit: investments/reinvestments in Allstate Financial Corporation, in violation of T.C.A. § 48–2–121; ...”, [and] unlawfully or knowingly, directly or indirectly, engaging “in an act, practice, or course of business which operates or would operate as a fraud or deceit upon investors in connection with the offer, sale, or purchase of a security, to wit: investments/reinvestments in Allstate Financial Corporation, in violation of T.C.A. § 48–2–121 ...”;
(3) that Mr. Talley's lawyer had reported this indictment to the Board of Professional Responsibility;
(4) that Mr. Talley had pleaded guilty to facilitation of a violation of the Tennessee Securities Act;
(5) that by pleading guilty to facilitation of a criminal violation of the Tennessee Securities Act, Mr. Talley “admitted” to being “criminally responsible for the facilitation of a felony [by furnishing] ... substantial assistance in the commission of a felony;”
(6) that the felony Mr. Talley pleaded guilty to facilitating “specifically involved the employment of a device, scheme or artifice to defraud investors in connection with the offer, sale or purchase of a security”;
(7) that in return for this guilty plea, Mr. Talley had received a suspended sentence of eleven months and twenty-nine days and had been placed on probation for the duration of the suspended sentence;
(8) that Mr. Talley had also been ordered to pay a $500 fine plus costs and had been ordered to perform one hundred hours of community service work;
(9) that Mr. Talley had filed a conditional guilty plea with the Board on July 28, 2005 involving “conduct similar in nature to the wrongful conduct” set out in the petition for discipline filed on December 19, 2005;
(10) that Mr. Talley “failed to admit any guilt in testimony before the [hearing] [p]anel and showed little, if any, remorse with regard to his conduct;”
(11) that Mr. Talley stated that he pleaded “guilty in both instances in order to...
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