“Ethics Monster” On The Docket

Dan Trevas has the story of a discipline case scheduled for oral argument tomorrow before the Ohio Supreme Court

Cleveland Metropolitan Bar Association v. Kenneth Ronald Donchatz, Case no. 2016-0859
Cuyahoga County

The Board of Professional Conduct has recommended that Kenneth R. Donchatz be suspended from the practice of law for two years, with six months stayed on the condition he doesn’t engage in further misconduct.

The charges stem from a complaint related to four client matters in which the Cleveland Metropolitan Bar Association alleged that Donchatz violated the rules governing Ohio lawyers. In its recommendation to the Court, the board noted that Donchatz served as an assistant Ohio attorney general employed by the Ohio Office of Disciplinary Counsel from 1998 to 2001. It also reported that Donchatz “characterizes himself as an expert in ethics” and has used the moniker “the ethics monster.”

Bar Alleges Improper Handling of Unpaid Judgment
Donchatz is facing several allegations of rule violations regarding his reaction to the Davey Tree Expert Company’s attempt to collect an unpaid debt from him. Davey Tree filed a lawsuit against Donchtaz to collect about $2,180 in unpaid invoices.

Donchatz represented himself in the matter, and Davey Tree obtained a default judgment against him in 2010. In 2012, Donchatz filed a notice that the judgment had been paid with the court without properly notifying Davey Tree. The attorney for Davey Tree alerted Donchatz that his action was incorrect and needed to be corrected with the court, and Donchatz allegedly didn’t make the correction. The court agreed to the company’s request to vacate the satisfaction notice and reinstated the judgment, which Donchatz continued not to pay, arguing he wrote a personal check to the company and “wrapped” it in a garnishment notice.

The board reported Donchatz never confirmed the check was received or cashed before filing his satisfaction notice. Donchatz sought to have the court reconsider the default judgment nearly three years after it happened, and Davey Tree resorted to seeking a garnishment order to compel Donchatz to pay. The trial court not only denied his request for reconsideration but awarded sanctions against him to compensate the company for its legal expenses incurred for collecting the payment. The board concluded that Donchatz violated several rules including the prohibition on knowingly making false statements to a court or failing to correct a false statement, disobeying an obligation issued by a court, and engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation.

Donchatz Accepts $100,000 Loan from Client
Donchatz became a private practitioner after leaving a law firm that had disbanded, and he accumulated unpaid taxes as a result. One of his clients offered to loan him $100,000, and Donchatz informed the client that he would represent the client for free, without putting the agreement in writing.

The representation began in 2007, but in 2013, Donchatz began to ask the client how the legal fees would be handled. He also accepted and refurbished an antique desk the client gave him. The client reported that Donchatz never informed her of the rules governing transactions between lawyers and their clients, didn’t notify her of a potential conflict of interest from the arrangement, and didn’t suggest she should seek another lawyer’s advice before making the loan.

Donchatz only repaid the client $57,000, returned the antique desk, and admitted to the board that he knew he violated the rules when he accepted the loan.

Attorney Suggests Donchatz Filed False Statement
Donchatz also is accused of filing a motion in a disciplinary case that contained a false statement and misrepresentations of the opposing attorney. Donchatz assumed representation of attorney Carol Hampton, who was facing her own disciplinary charges.

Hampton and her son were involved in a dispute with a property owner represented by attorney J.T. Holt. During the disciplinary proceedings, the two testified that Holt tape-recorded all three conversations among them, and Hampton alleged that the recording of the third conversation would prove her innocence. Donchatz requested from Karen Osmond, the assistant disciplinary counsel handling the matter, copies of the Holt’s tape-recorded conversations. Osmond provided Donchatz two recordings and told him she didn’t have a recording of the third conversation.

Donchatz made a second request from Osmond for the third tape. Osmond contacted Holt who confirmed there was no third recording and informed Donchatz of that. She also provided him with Holt’s phone number, inviting him to speak directly with Holt to verify the information.

Donchatz allegedly made one phone call to Holt, not using the number from Osmond but rather one provided by his client, which was not answered or returned. He then filed a motion in the case claiming that Osmond was withholding the recording and was “fully aware” that it existed. The motion didn’t mention that Osmond had investigated the missing tape, informed him of its nonexistence, or given him the opportunity to investigate for himself.

Osmond viewed the statements in the motion as false and misleading, and when asked by the disciplinary counsel to clarify his statements, Donchatz simply defended his position. The board concluded he violated the rules, including filing a claim without merit and engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation.

Dispute Over Fees Leads to Misleading Filing
In the final complaint against Donchatz, he represented a firm in dispute with Leader Technologies. Donchatz and attorneys for Leader engaged in mediation discussions mediated by a Franklin County magistrate. Donchatz circulated a draft “Stipulated Entry and Consent Judgment,” which he testified was requested by the magistrate. Leader’s attorney testified that the magistrate hadn’t requested a consent judgment, but rather asked Donchatz to put his proposed settlement in writing.

Without the consent of the parties or the direction of the magistrate, Donchatz submitted the entry to the court without indicating it was a draft or that there were unresolved issues still pending. Leader’s attorney informed Donchatz the filing wasn’t proper and requested he withdraw it.

The attorney informed Donchatz that if he didn’t withdraw the entry, he would institute disciplinary action against Donchatz for his dishonesty. Donchatz countered by stating he would file a disciplinary action against the company’s attorney for frivolous conduct and defaming him. The court vacated the entry, and the board found Donchatz violated attorney rules.

Donchatz Responds to Claims
Donchatz objects to the board’s recommendations and argues his behavior merits a lesser penalty. He suggests the conduct in his four cases is less harmful than the conduct of other attorneys who were sanctioned with a two-year suspension.

In the Davey Tree matter, Donchatz notes no client was involved and the tree company was hired after a contractor knocked down a portion of a tree on his property. The contractor reported the incident to his insurer, and Donchatz was under the impression the contractor or the insurer had made arrangements to pay Davey Tree. He admitted his handling of the matter was “sloppy” and that he incorrectly filed the notice that the judgment had been paid. Rather than withdrawing his notice, he allowed the company’s notice to vacate to go unopposed.

In the client loan case, he admitted he improperly took the loan, but contends he didn’t violate a representation agreement with the client. He maintains he agreed to represent the client for free, but that she was responsible for all “hard costs” in the matter, and noted he repaid her $57,000.

Donchatz characterized his statement’s about Osmond withholding evidence in the Hampton disciplinary matter as an “inartful statement of opinion,” Donchatz indicated he learned about the third recording through sworn testimony in which the property owner admitted she had no claims against Hampton. He maintains that Holt predictably denied taping the meeting.

Donchatz argues his statements regarding Osmond are opinion and he can’t be sanctioned for stating his opinion, which is protected by the First Amendment.

In the settlement matter, Donchatz asserts his actions to collect more than $120,000 in legal fees from Leader Technologies and its founder were guided at all times by the magistrate conducting the mediation. He noted he consulted with another attorney to draft the settlement and circulated it by email to the other parties. His brief states he received some arguments from the opposing sides, but the opposing attorney didn’t circulate a draft judgment and neither the opposing party nor the magistrate offered any changes or edits. He submitted the draft to the presiding judge a few weeks later who signed it. Donchatz offered that neither the magistrate nor the judge offered any evidence in his disciplinary case that he did anything wrong.

Board Fails to Consider Mitigating Evidence
Donchatz argues the three-member panel of the board hearing his case failed to consider any of the character evidence he offered. He noted that none of the letters “attesting to his high character and generosity in his more than 20 years of law practice” were mentioned in the panel’s report. He notes he has taught at Ohio State University’s law school for 16 years, coached the moot court team at Denison University for two years, coached the Westerville North High School mock trial team for 20 years, and volunteered as a member of the state’s Clients Security Fund for eight years, including one year as chairman.

He noted several honors and awards he received that were associated with community service and legal-related activities, and maintains there is no precedent that allows the panel to disregard the amount of character evidence he provided.

Bar Association Seeks Harsher Sanction
The Cleveland Metropolitan Bar Association objects to both the recommendation of the board and to Donchatz’s claims. The bar association argues Donchatz’s behavior warrant an indefinite suspension.

The association maintains that the board considered and appropriately weighed the relevant mitigating factors presented by Donchatz and that there is no support for his argument that the board panel disregarded his character evidence.

The association also objects to Donchatz’s characterizations of the Hampton and Leader Technologies complaints and maintains that there is ample support in the record to find he violated the rules.

The Ohio State Bar Association recognized his contribution to his local high school moot court program.

In the words of colleagues and students, Donchatz is “a hard-working, dedicated mentor and professional”; an individual of “exceptional character…dedicated to the promotion of the legal system and education”; and an “advocate [with a] true passion for law, and for educating students.”

Ohio oral arguments can be viewed in real time and in their video library. (Mike Frisch)