Affinity Group

The Michigan Attorney Discipline Board affirmed the imposition of a reprimand for an attorney’s decade-old misdemeanor conviction, rejecting the Grievance Administrator’s call for a more severe sanction and appeal of an adverse evidentiary ruling

The Grievance Administrator argues that it was an error for the hearing panel to apply character or reputation and remorse as evidence of mitigation. With regard to the consideration of testimony from respondent and his character witnesses, “[d]eference is given to the special opportunity of the trial court to judge the credibility of witnesses. MCR 2.613(C).” Grievance Administrator v Carrie L. P. Gray, 93-250-GA (ADB 1996), lv den 453 Mich 1216 (1996). The hearing panel here had the opportunity to observe the witnesses during their testimony, so we defer to the panel’s assessment of their demeanor and credibility. Grievance Administrator v Ernest Friedman, 18-37-GA (ADB 2019), citing Grievance Administrator v Neil C. Szabo, 96-228-GA (ADB 1998); Grievance Administrator v Deborah C. Lynch, No 96-96-GA (ADB 1997). The hearing panel heard testimony from respondent regarding his remorse, as well as testimony from two witnesses regarding respondent’s character and reputation. The panel was in the best position to ascertain respondent’s credibility as well as that of the witnesses, and nothing in the record warrants a departure from the panel’s subjective judgment.

The Grievance Administrator also asserts that the hearing panel should have given more weight to New York’s attorney discipline proceedings. However, this case was not brought as a reciprocal discipline proceeding, where the New York sanction would be relevant as the basis for imposing reciprocal discipline. Instead, the Administrator brought this case based solely on respondent’s judgment of conviction. Nevertheless, respondent’s two-year suspension in New York is not a final order, and is also not necessarily in line with other sanctions in that state for similar conduct.

Respondent’s misconduct consisted of a single misdemeanor conviction for an act that occurred over a decade ago. Although the panel found that respondent’s conduct “certainly impugns the reputation of the legal profession,” after reviewing the evidence presented, the relevant aggravating and mitigating factors, and considering the applicable ABA Standards as argued by the parties, the panel exercised its independent judgment and determined that a reprimand was appropriate. We see no reason to disturb this finding.

Respondent’s misconduct also did not involve client funds and was unrelated to the practice of law, respondent received no personal benefit, and his conduct appears to have been an isolated incident over the course of a nearly 40-year career as an attorney. Accordingly, we affirm the hearing panel’s order of reprimand.

The offense

Respondent has been a member of the Michigan State Bar since 1985, and was licensed to practice law in New York in 2015. Respondent testified that in 2014, he became partial owner of Affinity Human Resources, LLC, a Michigan-based company that provided outsourced payroll and human resource services for its customers. One of the other owners, Tommy Atamanoff, had significant contacts and relationships in the construction industry in New York, so much of Affinity’s business occurred in New York. The conviction at issue involved one of Affinity’s New York based construction companies, Parkside Construction. Respondent testified that he did not work much with Affinity until late 2014 because he was wrapping up another business, but then began working full time with Affinity in 2015 after he and Mr. Atamanoff bought out the third owner’s portion of the company, and ultimately became sole owner in 2016 after Mr. Atamanoff’s unexpected death.

In June of 2020, respondent pled guilty to a single count of falsifying business records/knowingly causing an omission in business records in the second degree (NY Penal Law 175.05), a misdemeanor, in satisfaction of a multi-count indictment charging him with, among other things, causing an omission in Parkside’s payroll records. Respondent was sentenced to a one-year conditional discharge, and ordered to pay $250 in court costs. Respondent immediately reported his conviction to the Michigan Attorney Grievance Commission as required by MCR 9.120(A).

On December 28, 2023, the New York Supreme Court, Appellate Division suspended respondent’s license to practice law in New York for two years, retroactively effective on June 9, 2022. This sanction was based, in part, on the referee’s finding that “as the sole owner and chief operating officer of a Michigan-based payroll processing company, Affinity Human Resources, LLC, respondent failed to report an omission in an application for workers’ compensation coverage submitted to the New York State Insurance Fund by one of Affinity’s construction company clients.” Respondent is currently appealing this order, however, because as he testified at the hearing in this matter, the application for workers’ compensation at issue was submitted by staff without his knowledge and prior to his involvement with the company, and did not involve any of the payroll records that were the basis for respondent’s conviction.

Scope of the Michigan proceeding and the Administrator’s attempt to introduce Affinity-related evidence

This disciplinary action at issue here is based only on respondent’s single misdemeanor conviction, not on respondent’s overall conduct. Neither respondent’s conviction nor the allegations here are based on the same facts or same offense as that of Affinity’s plea, and neither one is based on any purported conduct related to Affinity’s plea. Even though the pleas were placed on the record at the same time as a matter of judicial economy, the two pleas were separate proceedings, involving separate parties, and separate counsel. Further, respondent testified that the records involved in his plea were in no way related to an application for workers’ compensation insurance; the application at issue in the case against Affinity was filled out by staff before he was even working with the company; and he was not even aware of the application “until several years later when this all came up.” (Tr 6/10/24, pp 19-21.) In contrast, respondent’s plea related to internal payroll records, and these records were never submitted to any governmental agency or other outside entity. (Tr 6/10/24, pp 56-57, 65-66.)

Counsel for the Grievance Administrator asserts that Affinity’s plea transcript is “clearly relevant and admissible,” but fails to articulate why it is relevant, other than to say “the facts of Affinity’s plea were at least partially related to Respondent’s conviction.” Even if that were true in the criminal case, here the only issue is what is the appropriate sanction for respondent’s conviction. This is especially true where his conviction is the only alleged basis for discipline.

(Mike Frisch)