Up In Smoke

An Arizona attorney has agreed to a one-year suspension’in an agreement accepted by the Presiding Disciplinary Judge

In consolidated Counts One–Three, Ms. Ward represented multiple clients related to matters involving the medical marijuana industry. Natural Earth Providers, Inc., won a lottery to become the medical marijuana dispensary license holder for the Cordes Junction Community Health Analysis Area. Clients Jennifer Sanchez, John Romero, and Hector Martinez claimed ownership to N.E.P. Holding, who claimed it owned half of Natural Earth Providers, Inc., and Timothy Theiss claimed he owned the other half of Natural Earth Providers, Inc. Thereafter, “QPAC LLC” agreed to invest monies. Ms. Ward’s son, Michael Colburn was a member of QPAC, LLC, however, it is unknown who or what “QPAC, LLC” represents and it is disputed what the monies were for.

Ms. Ward conditionally admits she entered into a written fee agreement on July 2, 2013, with the above mentioned clients which included a Conflict of Interest Consent and Waiver, which she later attempted to retract to benefit herself. The fee agreement specifically precluded Respondent from representing any of the individuals (“Represented Parties”) against one another. It stated, “For the avoidance of doubt, our Firm would withdraw its representation of either Represented Party with respect to any such litigation, arbitration, or similar dispute.” She also avowed her firm, if litigation occurs, would “continue to protect confidential information learned during our Firm’s representation of each Represented Party and will not share this information with any other Represented Party.”

In spite of that clear language, Ms. Ward took the representation of Represented Parties in litigation against other Represented Parties when disputes arose between the parties. Ms. Ward filed multiple civil suits and engaged in extensive litigation against those clients. She engaged in conflicts of interest and revealed confidential information to the disadvantage of the clients, without the clients’ consent.

In Count Four, Ms. Ward’s son established Compassionate Care Dispensary (CCD), Inc., to become a medical marijuana dispensary in Winslow, AZ. Ms. Ward’s daughter-in-law Erica Brown, incorporated CCD and CCD applied to the Arizona Department of Health Services for a registration certificate. CCD needed to secure a location that met state requirements. John Gally owned the Winslow Water Building. CCD contacted Mr. Gally, who agreed to allow CCD to use the building for a dispensary and CCD applied for a conditional permit through its principal officers and directors, which included Ms. Ward’s son, Michael Colburn and her husband, Steven Smigay. Ms. Ward represented CCD in obtaining the required permit, which Mr. Gally supported. The conditional permit was obtained on May 17, 2011. Mr. Gally then asked Ms. Ward to represent him in some lease issues regarding other properties he owned. Ms. Ward represented Mr. Gally from July 2011-April 2014, without written communication of the scope of representation or basis for fees. Since 2007, Mr. Gally rented the Winslow Water Building to a water conditioning business. Ms. Ward thereafter, conditionally admits she engaged in conflicts of interest regarding CCD, and her client, Mr. Gally, while promoting her personal interests in promoting her son’s and husband’s interests in CCD. She further admits she did not provide competent representation to Mr. Gally and failed to communicate the scope of the representation and basis or rate of fee and expenses.

In Count Five, Tempe police executed a search warrant at the Medical Education Resource Center in March 2013. Ms. Ward arrived during the search and informed Tempe police she was the Medical Education Resource Center’s lawyer. In September 2013, a forfeiture action was filed by the Maricopa County Attorney’s Office regarding $7,900.00 seized during the search. Ms. Ward filed a claim on behalf of her firm for $7,185.00 as monies paid by law firm clients to be held in the IOLTA trust fund account for legal services under the clients’ retainer agreements with the law firm. Ms. Ward asserted the monies were seized from the premises of the law firm and identified clients as Jane and John Does. The court issued a forfeiture order, which Ms. Ward moved to set aside based on improper service.

Ms. Ward asserted to the court that the door to her law office was marked as “Suite C” and “Law Office” and she used that office as an auxiliary location when working on client matters. Tempe police reports reflected that no identifying markings were contained on the office doors when executing the search. The court ultimately set aside the forfeiture order and ruled entitlement to the monies was to be determined in civil court. Thereafter, the State sought to identify Ms. Ward’s clients to notify them of the forfeiture action involving their monies. Ms. Ward declined to provide that information. Ms. Ward also failed to provide her trust account records to the State Bar for the period January-May, 2013, as requested and stated her clients were not able to pay a retainer at the start of representation and by the time clients paid, she had earned the fees and therefore, the trust account rules were not implicated. Ms. Ward’s lack of disclosure is troubling for many reasons including an appearance of fraudulently benefiting herself through the crimes of another, as Ms. Ward’s position contradicted her position in the forfeiture action. She conditionally admits she could have been clearer in her court filings and submits any misrepresentations and or inconsistencies in those filings were attributed to a serious injury she experienced on August 23, 2013, and that she has been heavily medicated for pain since that time.

On many contested facts, Ms. Ward conditionally admits her misconduct violated Rule 42, ERs 1.1 (competence), 1.5 (fees), 1.6 (confidentiality of information), 1.7 (conflict of interest; current clients), 1.8 (conflict of interest; current clients; specific rules), 1.9 (duties to former clients), 1.15 (safekeeping property), 3.1 (meritorious claims and contentions), 8.1 (bar admission and disciplinary matters), 8.4(d), and Rules 43(a) and (b) (trust account), and Rule 54(d) (failure to comply with the State Bar’s request for information).

The approved sanction was not satisfying to the complainants

Here, the complainants appear to misapprehend the purpose of attorney discipline. It is not the function of attorney discipline to resolve the multiple civil claims which may be existent against Ms. Ward for her unethical actions. In this proceeding, she has acknowledged violating multiple ethical rules and agreed “there were actual injuries” to them, the legal profession, the legal system and the public. She acknowledges a selfish motive, a pattern of misconduct, multiple offenses, her refusal to acknowledge the wrongful nature of her conduct, the vulnerability of the victims, and her substantial experience in the practice of law.

While multiple facts may be disputed, the fact Ms. Ward acted unethically and caused injury is not. A hearing may well result in a lengthier suspension. It is not the forum however for resolving civil damages which complainants may be entitled to. Ms. Ward has acknowledged her unethical actions and the one (1) year suspension is a reasonable agreement.

The Phoenix New Times had reported on the charges. (Mike Frisch)