A Proposed Reprimand Becomes A Disbarment

The Idaho Supreme Court has rejected a proposed public reprimand and disbarred an attorney 

This is an attorney discipline case grounded in a dispute that this Court first addressed in Katseanes v. Katseanes, 171 Idaho 478, 522 P.3d 1236 (2023). Following resolution of that appeal, the Idaho State Bar (“ISB”) filed a complaint alleging that Justin Oleson had violated nine of the Idaho Rules of Professional Conduct (“Rules” or “Professional Rules”). After an evidentiary hearing, the Hearing Committee of the Professional Conduct Board (“Committee”) determined that Oleson violated three ethical rules—Rules 1.7(a)(2), 3.4(c), and 8.4(d)—and concluded that a public reprimand would be an appropriate sanction. The Committee also found that the ISB had not proved by clear and convincing evidence that Oleson had violated the six remaining rules: Rules 1.2(a), 1.3, 1.4, 3.3(a)(1), 4.1, and 8.4(c).

The ISB appeals the Committee’s determination that Oleson did not violate Rules 1.2(a), 1.3, 1.4, 4.1, and 8.4(c). It also challenges the sanction imposed by the Committee, a public reprimand, as being too lenient. Oleson cross-appeals the Committee’s determination that he violated Rules 1.7(a)(2), 3.4(c), and 8.4(d). He also argues that the Committee abused its discretion by taking judicial notice of several documents before issuing its decision. For the reasons discussed below, we reverse the Committee’s decision in part, affirm it in part, and impose a more severe sanction.

Respondent had represented the husband in a domestic matter; the wife’s attorney filed the bar complaint.

The issues related to disclosures involving the client’s retirement account

In this case, certain facts are undisputed. On March 18, 2021, the district court ordered Jeff to provide it with an accounting that detailed what he had done with the withdrawn retirement funds. Jeff then timely produced an accounting to Oleson, well before the court ordered deadline of April 1, 2021. However, Oleson then opted not to file the accounting with the court and instead filed an appeal and a letter. In the letter, Oleson explained that, while Jeff had timely provided the accounting to him, he did not “feel it proper” to file the accounting. He stated that he did not “believe” Jeff was required to submit the accounting, due to the appeal he filed the same day that, in his view, stayed the proceedings.

There is some dispute over whether, or to what extent, Oleson conferred with Jeff about filing a letter instead of the accounting. Jeff testified that Oleson did not consult with him about the decision at all, and it caught him by surprise, while Oleson maintains that Jeff directed him to refrain from filing the accounting and that he discussed the ramifications of that action with Jeff. Evaluating the conflicting evidence before it, the Committee made several factual findings in its Decision. The Committee unequivocally found that Oleson “never discussed with Jeff the potential consequences of failing to file the accounting,” and “did not inform Jeff that filing the letter instead of the accounting would violate the court order and could result in Jeff serving jail time.” The Committee also found that Oleson told Jeff that he should not have to comply with the court order, due to the legal stay Oleson believed would take effect. Despite these factual findings, the Committee concluded that Oleson did not violate Rules 1.2(a) and 1.4. As discussed below,  because the Committee’s own factual findings contradict its legal conclusion, we conclude that the Committee’s determinations were arbitrary and capricious, and clearly erroneous.

Rule 4.1 findings

Here, the misconduct occurred when Oleson actively deceived Dupree, the Rudd & Company representative, by informing her that there were no holds on Jeff’s retirement accounts. This conversation occurred shortly after the district court had orally granted Judy’s motion for the QDRO pertaining to such funds. While Dupree did not testify as a witness before the Committee, an affidavit containing her account of the phone call was admitted as evidence in this proceeding, and the transcript of her testimony before the district court regarding the issue was provided to the Committee (both of which were part of the record from the underlying Katseanes case). According to Dupree, Oleson told her that “there were no holds on the retirement account, that there was no QDRO that was going to be entered and that [she] should feel free to distribute the retirement funds.” In a subsequent letter to the ISB, Oleson conceded that he told Dupree that “it did not appear to [him] that she had any legal basis to deny [Jeff’s] request” to withdraw the funds from the retirement account.

Oleson largely admits to making these statements to Dupree but asserts that they were not false because he technically told her the truth. Oleson maintains, as he did in the Katseanes appeal, that the QDRO was not in effect at the time of the phone call because the district court had not yet signed the order. Oleson testified to the Committee that he did not tell Dupree that there was “going to be no QDRO.” (Emphasis added). In other words, because he believed the QDRO was not yet effective, he was being truthful when he told Dupree that there were no current holds on the retirement funds; thus, he satisfied his ethical duty. Oleson opined that if Dupree had wanted to know whether there was going to be a QDRO imposed sometime in the future, she should have asked the question more precisely.

The court

We conclude that the Committee’s determination is clearly erroneous because the ISB did not need to establish that Dupree relied on Oleson’s statements at all; it only needed to establish that Oleson made a misleading or false statement to Dupree. Here, the Committee determined that, because there was no explanation “as to what [] Dupree relied upon to make the final decision for her company to release the monies to” Jeff, the ISB did not meet its burden. The Committee’s reasoning reads a requirement of reliance into Rule 4.1 that does not exist anywhere in its text. As stated by the ISB, “reliance is inapposite to concluding whether [Oleson]’s representations to Dupree regarding the QDRO status were false and/or contained material omissions under [Rule] 4.1.”

The uncontroverted evidence before the Committee demonstrated that Oleson violated Rules 4.1 and 8.4(c). Oleson informed Dupree that there were no holds on the retirement funds, despite the district court granting the QDRO on the funds only days beforehand. Further, Oleson was acutely aware that the district court had granted the motion for the QDRO, as he attended the hearing on the motion and acknowledged that Jeff had lost on the matter. Yet, he subsequently made misleading statements to Dupree about the status of the QDRO—informing her that no holds were in place—despite knowing that the district court had granted the QDRO. His statements were clearly intended to mislead Dupree by omitting a highly material fact—that the court had recently ordered a QDRO within the last few days.

Conflict

Because Oleson had an actual conflict of interest in his continued representation of Jeff, Oleson needed to inform Jeff of the conflict and obtain informed consent before continuing the representation. Oleson admits that he never informed Jeff of the conflict, nor obtained his consent to continue the representation. In fact, Oleson still refuses to acknowledge that a conflict ever existed. For these reasons, the Committee’s determination that Oleson violated Rule 1.7(a)(2) is supported by clear and convincing evidence and was not clearly erroneous or arbitrary and capricious. Accordingly, we uphold the Committee’s Decision in this regard.

Important advice to Idaho lawyers on compliance with court orders

Oleson’s argument is unavailing. It is true that lawyers must generally abide by their client’s directives. However, it is no excuse to directly violate a court order at the behest of one’s client. In his brief, Oleson argues that he cannot be found to have violated Rule 3.4(c) simply because he attempted to comply with Rule 1.2. This argument implicitly assumes that Oleson was required to comply with Rule 1.2 at the expense of violating Rule 3.4(c). Yet, this is a mistaken assumption because a lawyer is required to comply with all the Rules. Non-attorney clients are often uninformed about the law and its requirements; it is the duty of an attorney to explain the law and set boundaries on the potential courses of action, limited by the law itself, as well as the Professional Rules. If a client directs a lawyer to violate the law or a Rule, the lawyer should explain to the client why such action is impermissible. If the client continues to insist on the action nonetheless, it is incumbent on the attorney to withdraw. See I.R.P.C. 1.16 (“a lawyer . . . shall withdraw from the representation of a client if: (1) the representation will result in violation of the rules of professional conduct or other law[.]”; see also I.R.P.C. 1.16, cmt. 2 (“A lawyer ordinarily must decline or withdraw from representation if the client demands that the lawyer engage in 19 conduct that is illegal or violates the Rules of Professional Conduct or other law.”). An attorney cannot violate a court order or break the law simply because the client desires the lawyer to do so. Oleson complains that he had no choice but to violate at least one Rule, but this false dichotomy exists only because of Oleson’s misinterpretation of the Rules and misperception of the circumstances before him.

We take this opportunity to stress that the Professional Rules relating to client confidentiality are for the client’s benefit—they are not a shield for an attorney to use to justify violating other Rules. The practice of law is a learned profession. People who are not learned come to attorneys for advice about what they should do and how to best avoid negative consequences. As noted by former Chief Judge Edward Re of the United States Customs Court, being an attorney is well described as “answer[ing] a calling [] to enter a ministry, a ministry of justice whose members are committed to the rendering of service to attain the peaceful and just resolution of disputes.” Edward D. Re, “The Profession of the Law,” Journal of Civil Rights and Economic Development, Vol. 15, Winter 2000, Issue 2 Article 1 (St. John’s University School of Law).

To be clear, attorneys are not mercenaries who must do their client’s bidding without question. In fact, attorneys often must protect clients from their own bad choices. When confronted with a request that would result in a violation of the Rules of Professional Conduct, an attorney should not simply comply with the request and then hide behind other rules. Instead, they should inform and advise their client what they are ethically permitted to do and then counsel them to select a permissible course of action. If they cannot succeed in doing so, the attorney should follow the Rules and withdraw from the representation. I.R.P.C. 1.16. When a challenging ethical issue arises, attorneys are encouraged to seek guidance from Bar counsel and other knowledgeable attorneys.

The court rejected Respondent’s objection to taking judicial notice of facts.

In this case, Oleson simply asserts that taking judicial notice at the time of issuing its findings of fact was inappropriate; however, he never explains why that is the case. Importantly, Idaho Bar Commission Rule 525(m) states the Committee may take judicial notice when “it deems it appropriate”, not when a party deems it appropriate. Here, Oleson simply complains that he was unfairly disadvantaged by the Committee’s decision to take judicial notice of the ISB’s exhibits. However, he stops short of proffering a cogent argument as to why the Committee’s actions were improper in any way, especially where he failed to object at the time the Commission invited the parties to supplement the record. Accordingly, we conclude that the Committee did not abuse its discretion as to the timing of the judicial notice taken in this case.

As to sanction, the court noted prior offenses and aggravating factors

Oleson flatly refuses to acknowledge the wrongful nature of his conduct. At no point has he shown any contrition or remorse; he simply denies any wrongdoing and refuses to accept responsibility for his actions. Instead, he attempts to diminish the seriousness of his violations and casts blame on his client, claiming that he was simply following Jeff’s directions. In reference to Jeff serving jail time for contempt, Oleson testified that “[j]ail is not that bad” and noted that some clients make the “choice” to serve jail time instead of paying money. Beyond the sheer callousness of Oleson’s flippant response to Jeff unnecessarily serving jail time, we find his lack of remorse and personal accountability to be highly aggravating circumstances. See Smith, 170 Idaho at 554, 513 P.3d at 1174.

We also conclude that Oleson also had a selfish and dishonest motive for his misconduct, which is a significant aggravating factor. Oleson misled Dupree when he led her to believe there was no QDRO or hold on Jeff’s retirement funds that would prevent him from withdrawing the funds. He did so despite being acutely aware of the district court’s oral grant of the QDRO, entered just days beforehand. As the ABA notes, false statements “can result in a finding of dishonest or selfish motive.” We conclude that this is exactly what occurred here because Oleson profited financially from his misconduct. Oleson had earlier requested to be paid by Jeff, knowing that the only way he could obtain the money was by improperly withdrawing the retirement funds. Oleson admitted that he knew the court would view withdrawing the retirement funds as problematic. Yet, even with that knowledge, instead of holding the funds in his trust account, the funds were deposited directly into his firm’s operating account and were spent. This conduct serves as another aggravating factor.

And

Moreover, Oleson’s arguments to this Court regarding sanctions are wholly unhelpful. Rather than contend with the serious nature of his misconduct, Oleson attacks the ISB’s investigation of him by characterizing it as a “witch hunt” based on false and uncorroborated evidence and contends that the entire case was “contrived” against him. In sum, instead of accepting responsibility for his actions and expressing remorse, Oleson now attempts to blame the ISB for his troubles. To be clear, we conclude that there is no evidence that this was a “witch hunt” against Oleson. The ISB pursued its investigation of Oleson only after receiving a formal grievance filed by Oleson’s opposing counsel, who observed his misconduct and reported it. In this sense, the ISB was fulfilling its duty to investigate a formal grievance and protect the public from attorney misconduct.

Oleson also makes the novel and unsupported claim that it was “a violation of Idaho Bar Commission rules for the ISB counsel to ‘investigate’ anything beyond the scope of the grievance” initially filed by the grievant. Oleson contends that “if there is not a grievance about a violation of the rules of professional conduct, ISB counsel does not have authority, by the applicable rules, to go ‘search’ for potential, ‘additional violations.’ ” However, Oleson does not cite any rule purporting to limit the scope of the ISB’s investigation to the “four corners” of the original grievance. In reality, Oleson’s claim misperceives the nature of the ISB’s authority. The ISB has the authority to investigate misconduct reported in grievances; if it discovers other violations of the Rules during the course of its investigation, nothing precludes it from taking action based on such a discovery. See e.g., I.B.C.R. § 509.

Result

We have conducted an independent review of the record and carefully considered the nature of the seven violations Oleson has committed. Additionally, we again note that this is Oleson’s third disciplinary case since 2020. After considering the mitigating and aggravating circumstances, including Oleson’s fitness to practice law, we conclude that the Committee’s recommended sanction, a public reprimand, is arbitrary and capricious because it is far too lenient for this level of misconduct and is insufficient to adequately protect the public, the courts, and the legal profession. Instead, we conclude that the appropriate sanction for Oleson in this case is disbarment.

We recognize the seriousness of this sanction and are mindful of the consequences for Oleson. This is not a result that was reached lightly. Only after much discussion and reflection have we determined that disbarment is appropriate in this instance because Oleson’s violations of the Professional Rules of Conduct were not only egregious of themselves, but also resulted in significant harm to his client and others. Oleson’s actions were a deliberate attempt by an officer of the court to frustrate justice by undermining a judge’s rulings, rendering his actions an affront to the rule of law, the legal profession, and to the reputation of those who ethically engage in the practice of law.

The court entered the following order

An Opinion was issued by this Court on April 2, 2025. Thereafter, a PETITION FOR REHEARING AND EMERGENCY MOTION FOR STAY PENDING PETITION FOR REHEARING was filed by counsel for Respondent/Cross Appellant on April 2, 2025, requesting this Court stay the imposition of disbarment until Respondent/Cross Appellant’s Petition for Rehearing has been decided by this Court. Therefore, after due consideration,

IT IS ORDERED that Respondent/Cross Appellant’s EMERGENCY MOTION FOR STAY PENDING PETITION FOR REHEARING is DENIED; however, pursuant to I.B.C.R. 516(a)(2), Respondent/Cross Appellant shall have fourteen (14) days from the date of this Court’s Opinion to wind up and complete on behalf of any client, all matters pending. Respondent/Cross Appellant shall be allowed to continue to represent the State of Idaho in the current trial in progress in Custer County case number CR19-24-0155, State v. Caton.

IT IS FURTHER ORDERED that Respondent/Cross Appellant’s Brief in Support of Rehearing shall be filed with this Court on or before April 16, 2025.

(Mike Frisch)