LD-2003-001, RICHMOND'S CASE

wage claim. During the prior year, Gras had been terminated from his position 1997 in an action against Gras’ former employer to collect his judgment on a Environmental Showcase, Limited (ESL). Richmond first represented Gras in involvement with Gras in the formation of an Internet start - up company, matter arose from Richmond’s representation of Seaton Gras and his later practice of law in New Hampshire in May 19 96. This professional conduct The record reflects the following facts. Richmond was admitted to the

recommended sanction. suspension for six months and assessment of costs. We adopt the referee’s 1.1(b)(1), 1.1(b)(5), 1.7(a), 1.7(b), 1.8(a), 7.1(a) and 8.4(a), and recommended Richmond violated New Hampshire Rules of Professional Conduct 1.1(a), for a hearing. The referee found by clear and convincing evidence that the practic e of law. We referred the petition to a Judicial Referee (Temple, J.) the respondent, William M. Richmond, receive a six - month suspension from Professional Conduct (committee) filed a petition with this court requesting that DUGGAN, J. On March 6, 2003, the Supreme Court Committee on

William M. Richmond, by brief and orally, pro se.

Rosenblatt on the brief and orally), for the committee on professional conduct. Cook, Little, Rosenblatt & Manson, P.L.L.C., of Manchester (Arnold

No. LD - 2003 - 001 Original

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. O pinions are available on the Internet by 9:00 Errors may be reported by E - mail at the following address: errors in order that corrections may be made before the opinion goes to press. Hampshire, One Noble Drive, Concord, New Hampshire 03301, of any editorial Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as 2

correction or additional disclosure. After further discussions with the Bureau, the form U - 7 and commented on at least eighty - four items that required offerings th at had never been filed. The Bureau completed an initial review of businesses file direct public offerings, although Richmond had only drafted site for Richmond’s law firm suggested that he had experience in helping small order to conduct a sale of up to one million dollars of common stock. The web document with the New Hampshire Bureau of Securities Regulation (B ureau) in In August 1999, on ESL’s behalf, Richmond filed a form U - 7 disclosure

advice of independent counsel regarding the potential conflicts. consent to serve as corporate counsel and did not advise the board to seek the and shareholder. Richmond failed to obtain the board members’ written interest stemming from his roles as COO, corporate counsel, board member involvement with ESL, Richmond never disclosed the potential conflict of laws and advised ESL on securities matters. Over the cours e of his counsel, Richmond filed ESL’s articles of incorporation, drafted corporate by directors and the Chief Operating Officer (COO). Acting as COO and corporate executive officer of ESL, whi le Richmond was a member of the board of environmental industry. Gras was the majority shareholder and chief based upon an idea that Gras developed to provide a web portal to the During the same period of time in 1999, Gras and Richmond formed ESL

withdrawal over Gra s’ objection. Gras in the bankruptcy action. The bankruptcy court permitted Richmond’s thereafter, Richmond filed a motion for leave to withdraw from representing approval, even though the settlement terms were adverse to Gras. Shortly negotiations, he reviewed the settlement agreement and ga ve Bunce his litigation. Although Richmond did not aid Bunce in the settlement from the bankruptcy petition against GES and cease assisting Gras in that matter with Bar nes. The settlement agreement required Bunce to withdraw November 1999, Bunce, without Richmond’s assistance, agreed to settle the Barnes, another GES co - venturer, on an unpaid promissory note. In Richmond also represented Bunce in a lawsuit brought against him by Stephen While representing Gras and Bunce on t heir bankruptcy claim,

from either client. the conflict. Richmond, however, did not obtain a written waiver of the conflict created by his joint representation of Gras and Bunce and they orally waived GES. Richmond testified that he discusse d the potential conflict of interest Bunce, a co - venturer in GES, in an involuntary bankruptcy action against Two years later, in April 1999, Richmond represented Gras and Graham

the $ p. 3 36,000 owed to Gras. three other co - venturers in 1994. Richmond collected approximately $6,000 of at Global Environmental Solutions (GES), a company he formed along with 3

he violated these rules. practitioner” stan dard, there is insufficient evidence to support a finding that Rules 1.1(a) and (b). He argues that under the correct standard, a “general applied a “specialist” or “expert” standard when evaluating his conduct under We first address Richmond’s argument that the referee incorrectly

(2002), cert. denied, 540 U.S. 81 5 (200 p. 3 3). whether the referee committed errors of law. Feld’s Case, 149 N.H. 19, 22 upon the evidence presented. Id. However, we review de novo to determine a reasonable person could reach the same conclusion as the referee based 132, 136 (2003). We review the referee’s factual findings to determine whether has occurred and, if so, the appropriate sanction. Shillen’s Case, 149 N.H. whether, on the facts found, a violation of the rules governing attorney conduct if supported by the record but retain the ultimate autho rity to determine In professional conduct matters, we defer to the referee’s factual findings

referee’s findings and recommended sanctions. of s everal mitigating factors. The committee argues that we should adopt the referee recommended based upon the severity of the offenses and the presence interest violations, he argues that we should impose a lesser sanction than the 7.1. Although Richmond does not dispute the referee’s findings of conflict of site advertisement was false and misleading. See N.H. R. Pro f. Conduct 1.1, evaluating his competence in securities law and in determining that his web Richmond argues that the referee applied an improper standard in

as sessment of all expenses incurred by the committee. Richmond receive a six - month suspension from the practice of law and misrepresenting his firm’s legal services. The referee recommended that unregistered securities, inadequately preparing the form U - 7 and found that Richmond violated Rule s 1.1(a) and (b), 7.1(a) and 8.4(a) by issuing potential conflict of interest and obtaining a written waiver. Finally, the referee operating ESL while serving as corporate counsel without disclosing the Richmon d violated Rules 1.7(a) and (b), 1.8(a) and 8.4(a) by forming and consent to the representation despite the conflicts. The referee also found that adequately identifying the conflicts of interest and obtaining both clients’ of Professional Conduct 1.7(a) and (b) in representing Gras and Bunce without Based upon these facts, the referee found that Richmond vio lated Rules

the securities laws. Richmond and Gras were ordered to cease and desist from further violations of p. 4 421 - B:11 (Supp. 2004). ESL agreed to pay a $7,500 administrative fine and and selling securities without a license. See RSA 421 - B:6 (Supp. 2004); RSA ESL admitted violating State securities laws by selling unregistered securities an investigation that resulted in a consent order in which Richmond, Gras and Richmond later withdrew the form U - 7 on ESL’s behalf. The Bureau conducted 4

the correct standard in evaluating Richmond’s conduct and that the record standards and securities practice.” Thus, we conclude that the referee applied “examples throughout the form that reflect an unfamiliarity with disclosure filing the form U - 7 by contacting a staff attorney at the Bureau, Reische noted Richmond argues that he made reasonable efforts to learn the requirements for pay s ufficient attention to detail to avoid harm to ESL’s interests. Although beyond his competence and bring these to the client’s attention, and failed to not have specific knowledge about securities law, failed to identify areas other sources.” Likewise, Reische testified that, in his opinion, Richmond did securities legislation” and “failed to . . . acquire the neede d knowledge from and skill concerning the operation and interplay with state and federal In his report, the referee noted that Richmond “lacked needed knowledge

is practicing in order to avo id harm to the client. See id. 1.1(b)(1), (3). acquire sufficient knowledge about the specific area of law in which the lawyer practitioner must identify areas in which the lawyer is not competent and required in some circumstances.” Id. Rule 1.1 mandates that a general Code Comments. However, “[e]xpertise in a particular field of law may be problems of a type with which the lawyer is unfamiliar.” Id. 1.1 ABA Model lawyer need not necessarily have special training or prior experience to handle instances, the required proficiency is that of a gen eral practitioner. . . . A 1.1. The ABA Model Code comments to Rule 1.1 state that “[i]n many required in order to meet the minimum standards for competency under Rule agree with Richm ond that expertise in a specific area of law generally is not and skill of a securities law specialist in judging Richmond’s conduct. We in evaluating Richmond’s competency and in doing so applied the knowledge testimony of Alan L. Reische, the committee’s expert witness on securities law, Richmond argues that the referee erred in relying upon the r eport and

Id. 1.1(b).

client’s interest. matter undertaken is completed with no avoidable harm to the (5) attention to details and schedules necessary to assure that the ( p. 4 4) proper preparation; and bringing those areas to the client’s attenti on; (3) identification of areas beyond the lawyer’s competence and (2) performance of the techniques of practice with skill; practices; (1) specific knowledge about the fields of law in which the lawyer

requirement s for legal competence: client.” N.H. R. Prof. Conduct 1.1(a). Rule 1.1(b) establishes the minimum Rule 1.1(a) states, “A lawyer shall provide competent representation to a p. 5 5

Richmond counters that a reprimand combined with probation would causes injury or potential i njury to a client.” Standards, supra § 4. p. 5 52. an area of practice in which the lawyer knows he or she is not competent, and Standards provide that suspension is appropriate when a lawyer “engages in We first examine the recommended sanction for lack of competence. The

Responsibility Rules and Standards 341 (1999 ed.). misconduct.” American Bar Association, Compendium of Professional generally should be greater than the sanction for the most serious i nstance of misconduct among a number of violations; it might well be and imposed “should at least be consistent with the sanction for the most serious case of multiple charges of misconduct, the ABA recommends that the sanction Kersey’s Case, 1 p. 5 50 N.H. 585, 587, cert. denied, 125 S. Ct. 97 (2004). In the existence of aggravating or mitigating factors.” Standa rds, supra § 3.0; see the potential or actual injury caused by the lawyer’s misconduct; and (d) the in imposing sanctions: “(a) the duty violated; (b) the lawyer’s mental state; (c) N.H. at 28. The Standards set forth the fo llowing factors for courts to consider Sanctions (1992) (Standards), we look to them for guidance. Feld’s Case, 149 Although we have not adopted the ABA Standards for Imposing Lawyer

mitigating circumstances appearing in the record. Id. impose must take into account the severity of the misconduct and any similar conduct in the future.” Id. (quotation omitted). The sanction we confidence in the bar, preserve the integrity of the legal profession, and prevent 1 p. 5 59 (2003). Rather, its purpose “is to pr otect the public, maintain public mode of inflicting punishment for an offense. O’Meara’s Case, 150 N.H. 157, exercising our authority, we are mindful that discipline is not intended as a violations warrant l esser sanctions than those recommended by the referee. In we next consider the appropriate sanction. Richmond argues that his Having found that Richmond violated the Rules of Professional Conduct,

misrepresentation of fact in violation of Rule 7.1. record supports the referee’s fin ding that Richmond presented a material registration statement for the issuance of stock with the Bureau. Thus, the law.” Richmond testified that he had previously drafted, but never filed, a even thou gh “he did not have any special training or experience in securities Richmond’s web site advertised his expertise in financing and raising capital misrepresentation of fact or law.” Id. 7.1(a). The referee found that Id. 7.1. A communication is false or misleading if it “contains a material “false or misleading communication about the lawyer or the lawyer’s services.” his firm’s web site violated Rule 7.1. Rule 7.1 prohibits a lawyer from making a Richmond also argues that the referee erred in finding that the content of

(b)( p. 5 5). supports the referee’s finding that Richmond viola ted Rules 1.1(a), (b)(1) and p. 6 6

whether there was a “timely good faith effort to make rest itution or to rectify rectify the conflict of interest that developed. However, mitigation considers Gras in the bankruptcy litigation, he made a timely and good faith effort to Second, Richmond argues that b y withdrawing from his representation of

be present. his experience in securities law. Thus, we do not find this mitigating factor to Richmond acted dishonestly in misrepresenting on his web site the extent of ESL as a co - venturer. See S tandards, supra § 9.32(b). We find, however, that coupled with his belief that he participated in the formation and operation of First, Richmond points to his lack of a dishonest or selfish motive,

at 29. evidence a nd weight of each of these factors in turn. See Feld’s Case, 149 N.H. (5) his remorse for his actions. See Standards, supra § 9.32. We consider the with the committee; (4) the fact that he has already suffered financial loss; and his good faith effort to remedy the effects of his misconduct; (3) his cooperation factors support a more lenient sanction: (1) his lack of a dishonest motive; (2) suspended for six months. Richmond argues that the following mitigating no substantial mitigating factors and recommended that Richmond be consider mitigating factors. Kersey’s Case, 150 N.H. at 588. The referee found Before we determine what disciplinary action we will take, we must also

violation of the Rules, as an aggravating factor. Standards, supra § 9.22. disciplinary offens e, including Richmond’s reprimand in 1999 for an unrelated supra §§ 9.21, 9.22; cf. Feld’s Case, 149 N.H. at 29. We also consider a prior factor that justifies an increase in the degree of discipline imposed. Standards, of m ultiple violations of the Rules of Professional Conduct is an a ggravating bankruptcy litigation and his role as corporate counsel for ESL. C ommitment Rules 1.7 and 1.8 through his joint representation of Gras and Bunce in the In addition to violating Rules 1.1 and 7.1, Richmond admitted violating

securities laws. withdrawal of the form U - p. 7 7 and an administrative fine for violations of State evidence that Richmond’s lack of competence harmed ESL, resulting in to filing the form U - 7. The record, however, provides clear and convincing made reasonable efforts to educate hims elf about the regulatory process prior web site. Throughout these proceedings, Richmond has maintained that he misrepresenting the extent of his experience in this practice area on his firm’s about securi ties law practice. Furthermore, Richmond violated Rule 7.1 by ESL’s stock offerings and filing the form U - 7 demonstrate his lack of knowledge needed to practice securities law. Richmond’s numerous errors in conducting referee found, and we agree, that Richmond lacked the skill and knowledge the integrity of the profession. See O’Meara’s Case, 150 N.H. at 159. The adequately address the purposes of discipline in this case, including preserving 7

that Richmond must satisfactorily complete the Multistate Professional 3 p. 7 7(16) (2003; amended 2003); Standards, supra § 2.8. Furthermore, we note he is admitted to practice law. See Sup. C t. R. 37 (14)(a) (2003; amended 2003); investigating and prosecuting this matter and disclose the jurisdictions where by a court - appointed attorney, reimburse the committee for the costs of referee’s recommen dation that Richmond surrender his client files for inventory six - month suspension from the practice of law. In addition, we adopt the substantial mitigating factors, we agree with the referee’s recommendation of a Because our review of the record reveals aggravating factors but no

150 N.H. at 159 - 60. not find a level of remorse adequate to merit mitigation. Cf. O’Meara’s Case, to offer legal services in areas in which he is not competent.” Therefore, we do “[a] risk of harm is presented by Mr. Richmond’s position that he may continue conflicts that could arise from his multiple representation of parties” a nd that however, found that “Mr. Richmond has shown little appreciation for the expressed remorse and admitted the conflict of interest violations. The referee, See Standards, supra § 9.32(m). The committe e acknowledges that Richmond Finally, Richmond argues that he feels sincere remorse for his violations.

under Rule 11 of the Federal Rules of Civil Procedure). Jones’ Case, 13 p. 7 7 N.H. 351, 359 (1993) (noting prior sanction and penalty not provide absolution from the charges made by [the] complaint”); see al so probation in criminal proceeding “is a circumstance to be considered but does N.H. 449, 450 (1970) (noting fact that attorney had been subjected to fines and penalty or sanction that would warrant mitigation. See Wholey’s Case, 110 financial losses resulting from his poor investment decisions as the type of sanctions” as a mitigating factor). However, we do not regard Richmond’s See Standards, supra § 9.32(l) (recognizing “imposition of other penalties or suspension from practice would terminate his means of earning a livelihood. because he already suffered financial loss due to his involvement with ESL and Fourth, Richmond argues that suspension is too great a sanction

committee’s investigation. See Feld’s Case, 149 N. H. at 29. factor because a lawyer has a professional duty to cooperate with the inquiries and ensuing hearings, we do not ascribe significant weight to this § 9.32(e). Althou gh we agree that Richmond cooperated with the committee’s and was forthcoming in his testimony before the referee. See Standards, supra Third, Richmond argues that he has been cooperative with the committee

mitigation. causes harm. See N.H. R. Prof. Conduct 1.16(a)(1). Thus, there is no requires the termination of a professional relationship after a conflict of interest withdrawal did not “rectify consequences” but merely satisfied Rule 1.16, which consequences of misconduct.” Standards, supra § 9.32(d). Richmond’s p. 8 8

concurred. BRODERICK, C.J., and NADEAU, DALIANIS and GALWAY, JJ.,

Court Rule 37(14)(f) (2004) regarding reinstatement. Richmond may be reinstated pursuant to the procedure set forth in Supreme compliance with all the terms and condition s of this order. We order that the practice of law after the expiration of the suspension period upon reconsideration, whichever is later. Richmond shall have the right to resume issuance of a decision based upon any motions for rehearing or suspension shall begin thirty days from the date of this opinion or upon We remand to the referee to determine the costs associated with this case. The Richmond is hereby suspended from the practice of law for six months.

(2003; amended 2003). Responsibility Examination in order to be reinstated. See Sup. Ct. R. 3 7(12)(e)