Joseph A. Ritzo (2010)

evidence, as set forth below.

filing on December 14, the Committee found the following facts, by clear and convincing

and Respondent's materials filed on November 30,2009, and Assistant Disciplinary Counsel's

2009. Based on its consideration of the entire record, including the parties' Stipulation of Facts

on November 30,2009, and Assistant Disciplinary Counsel filed his response on December 14,

Reconsideration on November 17,2009. Respondent's Counsel then filed additional materials

finding. Following deliberations, the Committee granted an Assented-To Motion for

Process on October 27,2009, and sent the matter back to the Hearings Committee for fact

The Committee had previously denied the Motion to Waive the Hearings Committee

and James R. Martin. Benette Pizzimenti was absent.

Chair; Susan R. Chollet, David N. Cole; Alan 1. Cronheim; Gerald A. Daley; Richard H. Darling,

captioned matter. Members present included: Margaret H. Nelson, Chair; Toni M. Gray, Vice

On January 19, 2010, the Professional Conduct Committee deliberated the above

Ritzo, Joseph A. advs. Alexander Columbus # 07-052

their behalf.

Columbuses indicated their desire at some later time to have a document executed on

were advised that a POA would be held in their file and available for use if the

documents in the case. Consistent with usual office practice at the time, the Columbuses

that a Power of Attorney ("POA") might be useful in connection with the execution of

5. Mr. Columbus and his wife, Carolyn, were advised by Mr. Ritzo or a member of his staff

obtaining the consent of the other.

2005, neither Mr. Columbus nor Mr. Ritzo was authorized to settle the case without first

fee. Under the contingent fee agreement executed by Mr. Columbus on February 28,

Mr. Ritzo agreed to represent Mr. Columbus in consideration of a one-third contingency

personal injury claim arising out of a dog bite incident that occurred in October 2004.

4. In February 2005, Mr. Columbus retained Mr. Ritzo to represent him in connection with a

connection with his handling of a personal injury claim for Mr. Columbus.

Columbus alleged that Mr. Ritzo violated the Rules of Professional Conduct in

3. Complainant, Alexander Columbus, filed a complaint dated September 7,2007. Mr.

operated his law business as a sole practitioner. He also employed non-lawyer assistants.

Portsmouth, New Hampshire 03802-0658. At all such times, Mr. Ritzo owned and

Street, Portsmouth, New Hampshire, with a mailing address of P.O. Box 658,

2. At all times material to this proceeding, Mr. Ritzo has maintained an office at 426 Middle

Hampshire Bar in 1985.

1. Joseph A. Ritzo, Esquire, is a New Hampshire attorney who was admitted to the New

I. FINDINGS OF FACT p. 3 Page 3 of29

settlements obtained for clients. Ms. McLoughlin also submitted check and funds

settlement statements accounting for expenses and liens charged against the proceeds of

communications with medical lien holders and service providers, and preparation of final

representing defendants against whom Mr. Ritzo's clients asserted claims,

McLoughlin'S responsibilities included communications with insurance carriers

variety of responsibilities as a paralegal associated with the handling of client files. Ms.

10. Ms. McLoughlin had been employed by Mr. Ritzo since 2002. Ms. McLoughlin had a

Columbus file.

full-time office manager, Barbara MacKusick, was also involved in handling the

to handle the Columbus claim file through implementation of settlement. Mr. Ritzo's

9. Desiree McLoughlin, a full-time paralegal assistant employed by Mr. Ritzo, was assigned

at any time prior to settlement of the case.

8. Neither Mr. Ritzo nor anyone on his staff sent Mr. and Mrs. Columbus a copy of the POA

entered on the POA at that time.

entered at the time of execution of the POA; nor was the specimen signature of Mr. Ritzo

7. However, as was often the case in Mr. Ritzo's office at the time, no witness signature was

claim."

in [their] and on [their] behalf for the purpose of the settlement of the aforementioned

would appoint Mr. Ritzo their"lawful attorney in fact with full power and authority to act

February 28, 2005. Mr. and Mrs. Columbus executed the document which by its terms, ,

6. Pursuant to the foregoing advice, Mr. and Mrs. Columbus executed a POA on or about p. 4 Page 4 of29

service providers;

a) communicating with and obtaining documents and invoices from medical and other

including the following:

14. In connection with the Columbus claims file, Ms. McLoughlin performed various tasks,

Ms. McLoughlin's misconduct in this regard.

13. Ms. MacKusick and Mr. Ritzo's wife and bookkeeper, Tracy Ritzo, were also aware of

condition.

her misconduct, and that she was obtaining appropriate medical treatment to control her

suffered from a mental illness, that she had not been taking her medications at the time of

make restitution. According to Mr. Ritzo, Ms. McLoughlin also told Mr. Ritzo that she

had been an effective employee, she apologized for her conduct, and she promised to

responsibilities without any additional supervision because Mr. Ritzo believed that she

12. Mr. Ritzo allowed Ms. McLoughlin to remain employed and to retain her job

she had engaged in other misconduct relating to client accounts.

McLoughlin was eventually terminated in September 2008, when Mr. Ritzo learned that

card in Mr. Ritzo's name and had negotiated over $3,000 in unauthorized charges. Ms.

McLoughlin, and that Ms. McLoughlin had also applied for and obtained a new credit

credit card without his authority and charged approximately $10,000 in purchases for Ms.

discovered in August 2007 that, in 2005, Ms. McLoughlin had taken Mr. Ritzo's personal

11. Ms. McLoughlin retained her job and the aforementioned responsibilities after Mr. Ritzo

service providers, and lien holders.

transfer requisitions to Mr. Ritzo's bookkeeper, and handled disbursements to clients, p. 5 Page 5 of29

on the final settlement statement prepared in connection with the Columbuses' claim.

16. Mr. Ritzo did not carefully review or check information incorporated by Ms. McLoughlin

the release, but Mr. Columbus denies that ever occurred.

the release with Mr. Columbus. Ms. MacKusick recalls talking to Mr. Columbus about

recalls discussing the terms of settlement, but he has no specific recollection of discussing

expenses and lien obligations were deducted from the settlement amount. Mr. Ritzo

terms of the anticipated release or of the net recovery to Mr. Columbus after chargeable

Mr. Columbus indicates that there was no discussion with anyone in the office of the

settlement from the insurance company in the amount of $50,000. Mr. Columbus agreed.

15. In October 2006, Mr. Ritzo contacted Mr. Columbus and recommended that he accept a

disbursements.

f) attending to execution of documents required to close settlement and to make final

e) preparing and obtaining documents required to implement settlement, and

the claims;

account for all amounts to be properly deducted from the proceeds of settlement of

d) preparing and submitting for Mr. Ritzo' s review a settlement statement purporting to

services, expenses, and lien obligations associated with the claims;

c) submitting requisitions to Ms. Ritzo and obtaining checks intended as payment for

coverage to the persons against whom the claims were being pursued;

b) communicating with Nationwide Mutual Fire Insurance Company which provided p. 6 Page 6 of29

implement final settlement of the Columbus matter by executing the Release. Mr. and

21. On or about October 18, 2006, Ms. McLoughlin and Ms. MacKusick undertook to

and approved of these practices at the time.

without having any witness or specimen signatures entered on the POA. Mr. Ritzo knew

was not uncommon that POAs executed by clients would be used to execute documents

POAs filled in by office staff when the POA was used to execute documents. Further, it

uncommon to have the witness signature and the specimen signature (of Mr. Ritzo) on

20. While not necessarily the usual practice in Mr. Ritzo's office at the time, it was not

entered Mr. Ritzo's specimen signature on the POA.

when the claim file was first opened in February 2005. Ms. McLoughlin also apparently

signature on the witness line of the POA that had been signed by Mr. and Mrs. Columbus

19. In anticipation of closing on the settlement, Ms. McLoughlin apparently entered her

settlement proceeds.

prepared by Ms. McLoughlin, identifying expenses and other deductions from the

Columbuses supplied before such closing with a copy of the final settlement statement

Columbus at any time prior to execution and closing on the settlement. Nor were the

18. Neither Mr. Ritzo nor his staff forwarded a copy of the Release to Mr. and Mrs.

Mr. and Mrs. Columbus.

Claims ("Release"). The Release was enclosed, requiring notarized signatures of both

confirmed settlement in the amount of $50,000, in consideration of a Release of all

17. By letter dated October 17,2006, addressed to Mr. Ritzo, the insurance company p. 7 Page 7 of29

Ritzo as their attorney-in-fact.

settlement releases in cases where the clients had signed a POA drafted to appoint Mr.

and approved of the common practice of having Ms. McLoughlin sign clients' names on

25. While not necessarily the usual practice in Mr. Ritzo's office at the time, Mr. Ritzo knew

practice.

exclusively to Mr. Ritzo. Mr. Ritzo represents that he no longer uses POAs in his

Release. The POA, if properly prepared and used, would have granted the power

authorized Ms. McLoughlin or anyone else in Mr. Ritzo's office to sign their names to the

24. Neither Mr. nor Mrs. Columbus was present at the execution of the Release and neither

office at the time. Mr. Ritzo was aware of and approved of such practice.

the Release. Ms. Ruse describes the foregoing as a common practice in Mr. Ritzo's

McLoughlin's entry of what purported to be the signatures of Mr. and Mrs. Columbus on

23. Jessica Ruse, another employee in Mr. Ritzo's office, signed as witness to Ms.

like a male and a female signature.

also indicates that she varied the handwriting for Mr. and Mrs. Columbus to make it look

aware of and approved of Ms. McLoughlin's practice in this regard. Ms. McLoughlin

McLoughlin commonly executed settlement releases in this fashion. Mr. Ritzo was

the Release. While not necessarily the usual practice in Mr. Ritzo's office, Ms.

McLoughlin entered what purported to he the signatures of Mr. and Mrs. Columbus on

22. Relying on the existence of the POA, and, following her usual office practice, Ms.

closing.

Mrs. Columbus had approved of the $50,000 settlement, but they were not present at the p. 8 Page 8 of29

letter included a check for what purported to be Mr. Columbus's net recovery from the

33. Ms. McLoughlin prepared and sent a letter to Mr. Columbus, dated May 24, 2007. The

signature on correspondence and other documents generated in Mr. Ritzo's office.

32. Ms. McLoughlin was occasionally authorized to enter what purported to be Mr. Ritzo's

copy of the signed Release.

31. Neither Mr. Ritzo nor anyone else in his office supplied Mr. and Mrs. Columbus with a

signature for him.

Mr. Ritzo did not sign the letter. Ms. McLoughlin acknowledges entering Mr. Ritzo's

insurance company with a cover letter that purportedly bore the signature of Mr. Ritzo.

30. Ms. McLoughlin forwarded the Release executed on the Columbuses' behalf to the

company of the manner in which the Columbuses' Release was actually executed.

a POA. Nor did Mr. Ritzo or anyone else in Mr. Ritzo's office notify the insurance

that the Release of the Columbuses' claims was executed under the purported authority of

29. Neither Mr. Ritzo nor anyone else in Mr. Ritzo's office notified the insurance company

execution. Mr. Ritzo knew and approved of Ms. MacKusick's practice in this regard.

attesting to the appearance and voluntary acts of the clients who were not present at such

commonly undertook to notarize the execution of settlement releases by Ms. McLoughlin,

28. While not necessarily the usual practice in Mr. Ritzo's office at the time, Ms. MacKusick

false.

27. Ms. MacKusick's attestation as notary at the execution of the Columbus Release was

as a notary public, attesting to the presence and voluntary acts of Mr. and Mrs. Columbus.

26. Upon execution of the Release by Ms. McLoughlin, Ms. MacKusick entered her signature p. 9 Page 9 of29

documents to Mr. Columbus.

checks that had never been tendered to the providers and sent copies of the false

Mr. Ritzo's office. Ms. McLoughlin admits she did so by fabricating two cancelled

document a legitimate expenditure for medical narrative reports allegedly requested by

38. In response to Mr. Columbus's inquiry, Ms. McLoughlin acknowledges undertaking to

account.

certain checks obtained from Ms. Ritzo and deposited· the proceeds in her own personal

fictitious payees falsely identified by Ms. McLoughlin. Ms. McLoughlin falsely endorsed

37. Some of the checks requested by Ms. McLoughlin and obtained from Ms. Ritzo were for

information or documents.

disbursements in connection with the Columbus matter without requiring any supporting

36. Ms. McLoughlin also submitted check requests to Ms. Ritzo who approved the

statement, effectively reducing the net payout to Mr. Columbus.

35. Ms. McLoughlin, in fact, had made certain false expense and lien entries in the settlement

statement.

calling Ms. McLoughlin to question some of the deductions reflected in the settlement

34. Shortly after receiving the final settlement disbursement check, Mr. Columbus recalls

express authority.

signature for him and Mr. Ritzo represents that she did so on this occasion without his

Ritzo. However, Mr. Ritzo did not sign the letter. Ms. McLoughlin entered Mr. Ritzo's

McLoughlin and approved by Mr. Ritzo. The letter purportedly bore the signature of Mr.

settlement. It also included a copy of the settlement statement prepared by Ms. p. 10 Page 10 of29

McLoughlin signed the response letter using what purported to be Mr. Ritzo's signature.

26,2007, without informing Mr. Ritzo or the ADO of her action in this regard. Ms.

Ms. McLoughlin prepared and filed the response on behalf of Mr. Ritzo dated November

("ADO") enclosing Mr. Columbus's September 7, 2007, complaint against Mr. Ritzo.

42. Ms. McLoughlin also intercepted correspondence from the Attorney Discipline Office

recommending that Ms. McLoughlin take the Columbus files to Attorney Brad Lown.

Ritzo would not be notified of the proceeding in Auburn District Court. She recalls

McLoughlin that, in order to avoid adding to Mr. Ritzo's level of stress at the time, Mr.

41. Ms. MacKusick was aware of Mr. Columbus's court filing and agreed with Ms.

the amount of $1,425.

signature. She also used personal funds to make partial restitution to Mr. Columbus in

defense to the claim on August 30, 2007, using what purported to be Mr. Ritzo's

behalf of Mr. Ritzo, without notifying Mr. Ritzo. Ms. McLoughlin filed a letter of

McLoughlin intercepted the mail from the Court and undertook to handle the claim on

40. Mr. Columbus filed a small claim action in Auburn District Court on July 31, 2007. Ms.

settlement proceeds.

approximately $2,400 had been improperly deducted from his net recovery of the

various health care providers listed on the settlement statement and determined that

own investigation. According to Mr. Columbus, he contacted the medical lien holder and

questions about deductions from the proceeds of settlement, Mr. Columbus undertook his

39. Having received no satisfactory response from Mr. Ritzo's office in response to his p. 11 Page 11 of29

requested by Ms. McLoughlin and approved by Ms. Ritzo, the balance of funds held in

Upon disbursement of"bogus" checks drawn on the client trust account or other transfers

account was"out of trust" with regard to each client whose funds were misappropriated.

47. During the period of Ms. McLoughlin's aforesaid misconduct, Mr. Ritzo's client trust

integrity and did not require that check requisitions be accompanied by an invoice."

documentation. According to Mr. Schiffman, Ms. Ritzo"relied on Ms. McLoughlin's

Ms. Ritzo approved the requests without requiring supporting information or

"bogus" check requests to Ms. Ritzo without regard to whether or not an invoice existed.

46. Ms. McLoughlin obtained most of the misappropriated client funds by submitting

trust by Mr. Ritzo.

whose claims were settled by Mr. Ritzo and whose settlement funds were being held in

period 2005 to 2008, Ms. McLoughlin misappropriated over $60,000 from 25 clients

45. Mr. Schiffman's investigation report dated August 31, 2008, reveals that, during the

assistance of Ms. MacKusick.

Columbus matter. The investigation was performed by John T. Schiffman, CPA, with the

files following disclosure of Ms. McLoughlin's transgressions in connection with the

44. Mr. Ritzo has undertaken an investigation of the handling of other personal injury claim

proceeding.

has also fired Ms. McLoughlin. Ms. McLoughlin is currently the subject of a criminal

funds wrongfully taken from Mr. Columbus's settlement by Ms. McLoughlin. Mr. Ritzo

43. Mr. Ritzo has since been apprised of Mr. Columbus's complaint and made restitution of p. 12 Page 12 of29

delivered to Mr. Ritzo thereafter by Mr. Powers included any such reconciliations. Mr.

account reconciliations previously handled by Ms. Zani, none of the reports prepared and

Ritzo represents that he thought Mr. Powers would perform the monthly client trust

Ritzo had previously consulted) to provide financial services for the firm. While Mr.

the office in late 2002, Mr. Ritzo retained Mr. William Powers, CPA, (with whom Mr.

reconciliations, Mr. Ritzo was in compliance with the Rule in 2002. After Ms. Zani left

certain bookkeeping functions and to prepare the monthly client trust account

50. Relying on Melissa Zani, an attorney in his office with accounting expertise, to handle

financial affairs, with particular regard to client trust accounting.

Ritzo's wife and bookkeeper, Tracy Ritzo, was not qualified to manage the firm's

required in order to comply with the Rule. Mr. Calaman also expressed concern that Mr.

detail how to perform the monthly client trust account reconciliations and what was

in noncompliance with Rule 50(2)(F). Mr. Calaman met with Mr. Ritzo and explained in

spot audit conducted by the ADO's auditor, Craig Calaman, in 2001, Mr. Ritzo was found

period of Ms. McLoughlin's misconduct. However, he acknowledges the following: In a

49. Mr. Ritzo represents that he believed he was in compliance with the Rule during this

Supreme Court Rule 50(2)(F).

perform monthly client trust account reconciliations as required under New Hampshire

48. During the period of Ms. McLoughlin's aforesaid misconduct, Mr. Ritzo failed to

clients with respect to such account.

the client trust account did not equal or exceed the obligations Mr. Ritzo owed to his p. 13 Page 13 of29

for such funds in accordance with New Hampshire Supreme Court Rule 50.

each client's behalf as proceeds of the settlement of claims, and to maintain an account

53. Mr. Ritzo owed Mr. Columbus and his other clients a duty to safeguard funds received on

5.3(a), 5.3(b), 5.3(c), 8.4(a), 8.4(b), and 8.4(c), by clear and convincing evidence as follows:

The Committee accepted the Stipulation of the parties to the violation of Rules I. I 5(a),

foregoing rules."

maintained by him or his firm were held in accounts "in full compliance with the

Court Rule 50, Section 2 and that, based upon his own personal knowledge, client funds

had read Rule I. I 5 of the Rules of Professional Conduct and New Hampshire Supreme

52. With respect to each of the aforesaid Compliance Certificates, Mr. Ritzo certified that he

exceeded the obligations Mr. Ritzo owed to his clients with respect to such account.

reporting period, the balance of funds in Mr. Ritzo's client trust account equaled or

required by New Hampshire Supreme Court Rule 50; and b) that, at all times during the

reconciliations with respect to funds of each client held in the client trust account, as

reported in error, as follows: a) that Mr. Ritzo had undertaken the requisite monthly

Certificates ("Compliance Certificates") filed for 2003,2004, 2005, 2006, 2007, and 2008

51. Mr. Ritzo's New Hampshire Supreme Court Annual Trust Accounting Compliance

not address the individual client balances, as required under the Rule.

Powers reconciled the client trust account check book to the bank statements, but he did p. 14 Page 14 of29

60. Mr. Ritzo failed to comply with the aforementioned requirements, as follows:

assistants was compatible with Mr. Ritzo's professional obligations as a lawyer.

required to make reasonable efforts to ensure that the conduct of such non-lawyer

59. Having direct supervisory authority over his non-lawyer assistants, Mr. Ritzo was also

Mr. Ritzo's professional obligations as a lawyer.

assurance that the conduct of his non-lawyer assistant employees was compatible with

make reasonable efforts to ensure that his firm had in effect measures giving reasonable

58. Mr. Ritzo, as sole practitioner, manager, and owner of his law practice, was required to

Rule 5.3 (al and (b): Responsibilities Regarding

in violation of N.H. R. Prof. Conduct 1.15(a) and (b).

57. There is clear and convincing evidence that Mr. Ritzo's conduct, as described herein, was

settlement disbursement to Mr. Columbus and other clients.

against the proceeds of settlement of claims, thereby improperly reducing the net

clients were entitled to receive by allowing false expense and lien amounts to be charged

56. Mr. Ritzo breached his duty to promptly deliver funds that Mr. Columbus and other

New Hampshire Supreme Court Rule 50.

reconciliations pertaining to such funds during the period 2005 to 2008, as required under

Columbus and other clients by failing to conduct monthly client trust account

55. Mr. Ritzo breached his duty to safeguard settlement funds received on behalf of Mr.

funds that Mr. Columbus and Mr. Ritzo's other clients were entitled to receive.

54. Mr. Ritzo also owed Mr. Columbus and his other clients a duty to promptly deliver any p. 15 Page 15 of29

implement any other measures to ensure that his non-lawyer assistants with access to

f) Mr. Ritza did not undertake regular monthly trust account reconciliations or

transfer requisitions.

assistant in the office, was not able to successfully submit fraudulent check and funds

and documentation; and b) to ensure that Ms. McLoughlin, or any other non-lawyer

authorize disbursements of client funds without the necessary back-up information

e) Mr. Ritzo did not make reasonable efforts a) to ensure that Ms. Ritzo did not

proceeds.

liens associated with settlement of a client's claims and chargeable against settlement

non-lawyer assistants in his office properly handled and accounted for expenses and

d) Mr. Ritzo did not make reasonable efforts to ensure that Ms. McLoughlin and other

and did not falsely attest to the presence and execution of any authorized signatory.

non-lawyer notaries public in his office properly notarized claims release documents

c) Mr. Ritzo did not make reasonable efforts to ensure that Ms. MacKusick and other

clients' authority, and without notifying the party for whom the release was intended.

consideration of the settlement by falsely entering the clients' signatures, without the

non-lawyer assistants did not undertake to execute claims releases required in

b) Mr. Ritzo did not make reasonable efforts to ensure that Ms. McLoughlin and other

or his non-lawyer assistants in conformance with the clients' intentions and interests.

clients in favor of Mr. Ritzo were properly prepared, executed, and used by Mr. Ritzo

a) Mr. Ritzo did not make reasonable efforts to ensure that powers of attorney signed by p. 16 Page 16 of29

lawyer assistants.

belonging to the Columbuses and to 24 other clients served by Mr. Ritzo and his non­

e) Ms. McLoughlin, without Mr. Ritzo's actual knowledge, fraudulently obtained funds

misrepresenting the validity and authenticity of the Release, and

d) Ms. MacKusick falsely attested to the execution of the Columbuses' Release, thereby

authenticity of the Release;

or of the other irregularities in execution, thereby misrepresenting the validity and

Columbuses' claims without advising the company of the purported use of the POA

c) Ms. McLoughlin forwarded the Release to the insurance company settling the

company claims Release;

b) Ms. McLoughlin improperly entered the Columbuses' signatures on the insurance

Columbuses;

a) Ms. McLoughlin prepared and misused a defective POA executed by the

61. Mr. Ritzo's foregoing failures enabled the following:

handled by the firm, or of the public, from Ms. McLoughlin's further misconduct.

reasonable efforts to protect the interests of his clients, of parties in civil actions

g) Notwithstanding Ms. McLoughlin's prior fraudulent conduct, Mr. Ritzo did not make

clients.

balance of funds equaled or exceeded the obligations Mr. Ritzo owed to each of his

the client trust account were properly safeguarding client funds, and to ensure that the p. 17 Page 17 of29

practice in this regard. Mr. Ritzo failed to take any remedial action which would have

unsupported requisitions. Mr. Ritzo knew or should have known of Ms. Ritzo's

without proper back-up and supporting documentation. Ms. Ritzo approved the

b) During the period 2005 to 2008, Ms. McLoughlin submitted check requisitions

misappropriation of client funds violated Rules 1.15( a), 8.4(b) and (c).

would have avoided the misappropriation of client funds that followed. The

involvement in client matters and restricting her access to client funds. Such action

failed to discharge Ms. McLoughlin or to take any other remedial action limiting her

Mr. Ritzo's knowledge of Ms. McLoughlin's misconduct and dishonesty in 2005, he

a) Ms. McLoughlin undertook to steal money from Mr. Ritzo in 2005. Notwithstanding

mitigated with remedial action that Mr. Ritzo failed to take:

assistants at times when the consequences of such conduct could have been avoided or

63. Mr. Ritzo knew or should have known of the following conduct of his non-lawyer

mitigated and failed to take reasonable remedial action.

b) Mr. Ritzo knew of the conduct at a time when its consequences could be avoided or

conduct; or

a) Mr. Ritzo ordered or, with the knowledge of the specific conduct, ratified such

violation of the Rules of Professional Conduct if engaged in by a lawyer, if

62. Mr. Ritzo was responsible for the conduct of his non-lawyer assistants that would be in

Rule 5.3 (c): Responsibilities Regarding Non-lawyer Assistants, including conduct p. 18 Page 18 of29 confidence in the bar, preserve the integrity of the legal profession, and prevent similar conduct

The purpose of the Court's disciplinary power"is to protect the public, maintain public

be suspended.

Imposing Lawyer Sanctions (2005) ("Standards") support the conclusion that Mr. Ritzo should

Both case law in New Hampshire and the American Bar Association's Standards for

Ritzo's conduct, as described herein, violated N.H. R. Prof. Conduct 8.4(a).

65. Having found the foregoing violations, there is clear and convincing evidence that Mr.

8.4(b), and 8.4(c).

responsible for conduct described herein in violation of N.H. R. Prof. Conduct 1.15(a),

in violation of N.H. R. Prof. Conduct 5.3(c). Such violations would also render Mr. Ritzo

64. There is clear and convincing evidence that Mr. Ritzo' s conduct, as described herein, was

releases in exchange for settlement proceeds. Such conduct violated Rule 8.4( c).

of non-lawyer assistants resulting in the fraudulent execution and disbursement of

was aware of such conduct and failed to take any remedial action to avoid the conduct

other appropriate authority to execute claims releases on behalf of clients. Mr. Ritzo

connection with closing settlement of claims on behalf of clients. Nor did they obtain

c) Ms. McLoughlin and Ms. MacKusick did not properly prepare or use POAs in

client funds by Ms. McLoughlin also violated Rules 8.4(b) and ( c).

funds. Such conduct violated Rule 1. 15(a). The consequent misappropriation of

avoided the issuance of"bogus" checks and the consequent failure to safeguard client p. 19 Page 19 of29

professional obligations as a lawyer. The non-conforming conduct of Mr. Ritzo's non-lawyer

efforts to ensure that the conduct of his non-lawyer assistants was consistent with Mr. Ritzo's

Columbus and other clients, as well as to the legal profession, by failing to make reasonable

Under the first prong of the analysis, Mr. Ritzo violated duties owed to Mr. and Mrs.

(2005)).

the sanction for the most serious misconduct." Id. (citing Richmond's Case, 152 N.H. 155, 160

misconduct among a number of violations; it might well be and generally should be greater than

imposed "should at least be consistent with the sanction for the most serious instance of

In the case of multiple charges of misconduct, the ABA recommends that the sanction

affect the baseline sanction.

part of the analysis: the existence of any aggravating or mitigating factors and whether they

sanction.") Once the baseline sanction is determined, the Court then looks to the fourth and final

factors, the first step is to categorize the respondent's misconduct and identify the appropriate

determining a baseline sanction. See Conner's Case, 158 N.H. at 303. ("In applying these

The first three parts of the analysis create the framework for characterizing the misconduct and

mitigating factors." Id. (quoting Douglas' Case, 155 N.H. 613,621 (2007)); Standards § 3.0.

actual injury caused by the lawyer's misconduct; and (d) the existence of aggravating or

imposing sanctions: "(a) the duty violated; (b) the lawyer's mental state; (c) the potential or

Case, 158 N.H. at 303. The Standards set forth a four part analysis for courts to consider in

Although the Court has not adopted the Standards, it looks to them for guidance. Conner's

account the severity of the misconduct." Coffey's Case, 152 N.H. 503,513 (2005).

in the future." E.g., Conner IS Case, 158 N.H. 299, 303 (2009)."The sanction must take into p. 20 Page 20 of29

required by New Hampshire Supreme Court Rule 50; and d) filing annual trust accounting

failing to perform monthly client trust account reconciliations during the period 2003 to 2008, as

client trust account to be"out of trust" during the period of Ms. McLoughlin's misconduct; c)

settlement, and related disbursements, after Ms. McLoughlin's prior acts of theft; b) allowing the

handling of client settlements, accounting for expenses chargeable against the proceeds of

allowing Ms. McLoughlin to remain employed and to retain job responsibilities involving the

Mr. Ritzo violated his duty to his clients, to the legal profession, and to the Court by a)

office with his knowledge and approval.

The foregoing conduct of Mr. Ritzo's non-lawyer assistants commonly occurred in Mr. Ritzo's

circumstances of execution, thereby misrepresenting the validity and authenticity of the release.

such execution; and c) their delivery of the release to the insurance carrier without disclosing the

Columbuses' claims; b) their fraudulent execution of the release and fraudulent notarization of

and Mrs. Columbus and their unauthorized use of such power in executing a release of the

included a) their defective and incomplete preparation of a power of attorney executed by Mr.

In addition the non-conforming conduct of Mr. Ritzo's non-lawyer assistants in this matter

clients over the period 2005 to 2008.

checks and misappropriation of funds. Similar conduct occurred at the expense of several other

requiring supporting documentation; and d) Ms. McLoughlin's fraudulent negotiation of such

disbursement by Mr. Ritzo' s bookkeeper of such checks requested by Ms. McLoughlin without

Ritzo's bookkeeper of fraudulent check requests without supporting documentation; c)

deductions chargeable against the settlement proceeds; b) Ms. McLoughlin's submission to Mr.

assistants in this matter included: a) Ms. McLoughlin's false accounting of expenses and other p. 21 Page 21 of29

review of the reports, that monthly client trust account reconciliations, as required

firm from an outside accountant. Mr. Ritzo knew or should have known, upon

e) During the period 2002 to 2008, Mr. Ritzo received financial reports regarding his

what he was required to do thereafter in order to comply with Supreme Court Rule 50.

properly performed monthly reconciliations of his client trust account and he knew

d) At the conclusion of the spot audit conducted in 2001, Mr. Ritzo knew that he had not

appropriate supporting documentation.

neglected to require Ms. McLoughlin to accompany her check requests with

c) Mr. Ritzo knew or should have known that his wife, as bookkeeper, frequently

Ms. McLoughlin's final settlement statements.

b) Mr. Ritzo knew that he did not undertake a complete and thorough review of many of

without direct supervision.

check requests, and handling the distribution and disbursement of such checks)

expenses and other deductions chargeable against settlement proceeds, submitting

Ms. McLoughlin continued to process client claims (including accounting for

a) Mr. Ritzo knew that, notwithstanding Ms. McLoughlin's history of credit card theft,

were the product of gross negligence. For Example:

for the most part, were knowing. Some aspects of Mr. Ritzo's conduct, ifnot entirely knowing,

With respect to the second prong of the sanction analysis, Mr. Ritzo' s aforesaid breaches,

reconciliations.

compliance certificates with the Court representing falsely that he had performed such monthly p. 22 Page 22 of29

For determining a baseline sanction, the Standards provide material guidance.

the viability of trust accounting and certification requirements contemplated under Rule 50.

caused harm to the profession and to the Court by leaving the Court and the public in doubt as to

whether they can rely on lawyers to generate valid and authentic documents. Mr. Ritzo also

affairs, and b) to give companies and institutions doing business with law firms reason to doubt

a) to raise the question whether lawyers can be trusted to manage and safeguard their clients'

Mr. Ritzo caused harm to the legal profession by operating his office in such a way as

execution of releases of claims, potentially undermining settlements.

failing to correct common practices of his non-lawyer assistants that resulted in their fraudulent

from Mr. and Mrs. Columbus and many other clients; failing to safeguard client funds; and

charges against settlement proceeds and related check requests, resulting in the theft of funds·

Mrs. Columbus and other clients by allowing Ms. McLoughlin to handle the accounting of

injury caused by Mr. Ritzo's misconduct. Mr. Ritzo caused harm or potential harm to Mr. and

The third prong of the sanction analysis requires an assessment of the actual or potential

tendered in consideration of settlement proceeds.

relating to the preparation and use of powers of attorney and the execution of releases

7. Mr. Ritzo knew and approved of the non-lawyer assistants' conduct described herein

trust" in connection with client accounts that were being looted by Ms. McLoughlin.

6. During the period 2005 to 2008, Mr. Ritzo should have known that he was"out of

question.

under Rule 50, were not being performed by his accountant during the period in p. 23 Page 23 of29

Censure. I Section 4.13 uses the term "Reprimand." The most analogous sanction in New Hampshire is a Public

filing of accurate trust accounting compliance certificates, involves a breach of duty owed to the

Mr. Ritzo's failure to comply with Supreme Court Rule 50, with particular regard to the

reflects on the lawyer's fitness to practice law. dishonesty, fraud, deceit, or misrepresentation and that adversely lawyer knowingly engages in any other conduct that involves 5.13 Reprimand [public censure] is generally appropriate when a seriously adversely reflects on the lawyer's fitness to practice. listed in Standard 5.11 [specific criminal intent] and that engages in criminal conduct which does not contain the elements 5.12 Suspension is generally appropriate when a lawyer knowingly

part, as follows:

Section 5.1 of the Standards ("Failure to Maintain Personal Integrity") provides, in pertinent

misconduct, in handling settlements of claims also involved a breach of duty owed to the public.

Mr. Ritzo's failure to supervise his non-Iawye.r assistants, especially in light of their past

injury to a client. in dealing with client property and causes injury or potential 4.13 Reprimand is generally appropriate when a lawyer is negligent 1 and causes injury or potential injury to a client. should know that he is dealing improperly with client property 4.12 Suspension is generally appropriate when a lawyer knows or

provides, in pertinent part, as follows:

Ritzo's duty to protect the interests and property of his clients. Section 4.1 of the Standards

claims and his failure to properly maintain the client trust account involved breaches of Mr.

Mr. Ritzo's failure to supervise his non-lawyer assistants in handling settlements of p. 24 Page 24 of29

McLoughlin's prior efforts to steal from him.

Mr. Ritzo is credited with having voluntarily disclosed to the ADO information about Ms.

appropriate requirements for approving check requests.

Ms. McLoughlin's work, and b) to ensure that his wife and bookkeeper consistently imposed

Ms. McLoughlin's job responsibilities and/or to exercise extra care in supervising and reviewing

his failure, after learning that Ms. McLoughlin had stolen from him: a) to terminate or to limit

of law. Rather, Mr. Ritzo acknowledges responsibility for Ms. McLoughlin's conduct because of

unauthorized nature of Ms. McLoughlin's conduct, he should not be suspended from the practice

of Ms. McLoughlin's criminal scheme. Nor does Mr. Ritzo claim that, because of the

accounts. However, Mr. Ritzo does not claim to be absolved of responsibility as a mere victim

Columbus or other clients and that he did not know that Ms. McLoughlin was looting the

The parties agree that Mr. Ritzo did not intend to steal money from Mr. and Mrs.

potentially adverse effect on the legal proceeding. injury to a party to the legal proceeding, or causes an adverse or information is being withheld, and causes injury or potential documents are false or in taking remedial action when material lawyer is negligent either in determining whether statements or 6.13 Reprimand [public censure] is generally appropriate when a adverse effect on the legal proceeding. party to the legal proceeding, or causes an adverse or potentially no remedial action, and causes injury or potential injury to a that material information is improperly being withheld, and takes false statements or documents are being submitted to the court or 6.12 Suspension is generally appropriate when a lawyer knows that

provides, in pertinent part, as follows:

legal system and to the Court. Standards § 6.1 (False Statements, Fraud and Misrepresentation) p. 25 Page 25 of29

report on the client trust account; and Mr. Ritzo's failure over an extended period of time to

over an extended period of time, following a spot audit and warning, to properly manage and

regard to Ms. McLoughlin after learning of her prior acts of theft; Mr. Ritzo's repeated failure

A pattern of misconduct characterized by Mr. Ritzo's failure to take appropriate action with

In this case, aggravating factors include the following:

factors. E.g., Conner's Case, 158 N.H. at 303.

The baseline sanction must be considered in light of any aggravating and mitigating

for Mr. Ritzo's conduct is suspension.

Under the foregoing circumstances, the parties agree that the combined baseline sanction

for such improper conduct and the consequences thereof.

that he failed to take remedial action; and that, pursuant to Rule 5.3(c), he is directly responsible

the improper measures employed by his non-lawyer assistants to close this and other settlements;

tendering an invalid release. However, Mr. Ritzo acknowledges that he knew of and approved

by forging their signatures on the settlement release or to defraud the insurance company by

The parties agree that Mr. Ritzo had no specific intent to defraud Mr. and Mrs. Columbus

nevertheless certified his compliance with the rule.

whether he was in compliance with Rule 50, that he did not so determine, and that he

Ritzo acknowledges that he had the knowledge, information, and opportunity to determine

deceive the Court in filing his annual trust accounting compliance certificates. However, Mr.

client trust account reconciliation requirements of Rule 50; b) to be "out of trust"; or c) to

The parties also agree that Mr. Ritzo did not have a specific intent a) to disregard the p. 26 Page 26 of29

bookkeeping, accounting, and reporting practices are well-defined and consistently applied, and

unchecked or unfettered access to firm or client accounts, or to records of such accounts; e)

adequate safeguards are in place to ensure that no single employee in Mr. Ritzo's office has

requests and disbursements are properly documented, reviewed, approved, and accounted for; d)

make check requests and to handle disbursements are clearly defined and enforced; c) check

legitimate and properly documented and accounted for; b) policies with respect to the authority to

to take remedial action to ensure that a) expenses charged against the proceeds of settlement are

The ADO has joined in this recommendation, in part, because of Mr. Ritzo's commitment

conditions designed to ensure implementation of effective remedial measures.

sanction analysis, indicate that a six month suspension is the appropriate sanction, combined with

The aggravating and mitigating factors evident in this case, combined with the baseline

See Standards § 9.32.

no selfish motive; and Mr. Ritzo's expression of remorse and his acceptance of responsibility.

commitment to undertake remedial action in connection with his office practices; Mr. Ritzo had

proceedings, including his disclosure of Ms. McLoughlin's prior misconduct and his

misconduct.);Mr. Ritzo's full disclosure to the ADO and his cooperative attitude in the

he taken more timely remedial action leading to the discovery of Ms. McLoughlin's

referenced 25 clients. (Mr. Ritzo's efforts in this regard may have been undertaken sooner, had

Ritzo's good faith effort to make restitution of money taken by Ms. McLoughlin from the

Mitigating factors include the following: Mr. Ritzo has no prior disciplinary record; Mr.

substantial experience in the practice of law is also an aggravating factor. See Standards § 9.22.

supervise his non-lawyer assistants and to take appropriate remedial action. Mr. Ritzo's p. 27 Page 27 of29

remedial action. Mr. Ritzo agrees to implement such additional measures and to report to

of the client trust account. The report shall include any recommendations for further

Rule 50. The financial consultant shall view and report on current monthly reconciliations

and procedures in Mr. Ritzo's office designed to ensure compliance with Supreme Court

approved by the ADO) confirming implementation of satisfactory accounting practices

the ADO from Mr. Ritzo's financial consultant, Timothy Driscoll, CPA, (or other CPA

2. Within six months of his return to practice, Mr. Ritzo shall obtain and file a report with

confirming the satisfactory implementation of all necessary remedial measures.

auditor shall be filed with the ADO within five months of Mr. Ritzo's return to practice,

additional measures as may be recommended by the auditor. A final report from the

his recommendations for further remedial action. Mr. Ritzo agrees to implement such

reporting on the implementation of remedial measures as described above and articulating

Reinstatement. The auditor shall be approved by the ADO and shall be charged with

initial report shall be filed with the ADO within three months of Mr. Ritzo's

1. Mr. Ritzo shall obtain an independent office practices audit, at Mr. Ritzo's expense. An

following conditions:

The Committee voted to approve the StipUlation of a six month suspension with the

from the proceeds of settlement.

g) clients are fully informed as to the terms of settlement of their claims and their net recovery

Court Rule 50; f) documents requiring client signatures are properly prepared and executed; and

monthly client trust account reconciliations are performed in full compliance with Supreme p. 28 Page 28 of29

Committee shall be required.

37(14)(f) as to application for reinstatement to the practice of law. No further action of this

the conclusion of his suspension, Mr. Ritzo shall comply with N.H. Supreme Court Rule

5.3(a), 5.3(b), 5.3(c), 8.4(a), 8.4(b), and 8.4(c). This Order shall take effect on March 1,2010. At

of law for six months, for violating the New Hampshire Rules of Professional Conduct 1.15( a),

For all of the above reasons, the Committee suspends Joseph A. Ritzo from the practice

associated with the investigation and prosecution of this matter.

The parties stipulated, and the Committee approves, that the Respondent will pay all costs

hearing.

contempt. In the event of such an order, Mr. Ritzo shall be entitled to an evidentiary

reinstatement, he will be subject to an order to show cause why he should not be found in

4. In the event Mr. Ritzo fails to comply with any of the foregoing conditions of

months.

trust account reconciliations by the 15th of the following month for a period of twelve

3. Following his return to practice, Mr. Ritzo shall file with the ADO his monthly client

report.

the ADO on his satisfactory compliance therewith within 30 days of the issuance of such p. 29 Page 29 of29

File Alexander Columbus J effrcy K.· Karlin, Esquire Stephen L. Tober, Esquire James L. Kruse, Assistant Disciplinary Counsel Distribution:

Margaret H. Nelson, Chair James L. Kruse, Esquire Jeffrey H. Karlin, Esquire Joseph A. Ritzo, Esquire Distribution:

Broderick, C.J., and Dalianis, Duggan, Hicks and Conboy, JJ., concurred.

immediately. granted. He is reinstated to the practice of law in New Hampshire, effective reinstatement to the practice of law. Attorney Ritzo's motion for reinstatement is In accordance with Rule 37(14)(f), Joseph A. Ritzo filed a motion for

following order: Anthony Ritzo, the court on October 14, 2010, issued the In Case No. LD-2010-0011, In the Matter of Joseph