In the Matter of Disciplinary Proceedings Against James M. Schoenecker, Attorney at Law: Office of Lawyer Regulation, Complainant,
James M. Schoenecker, Respondent
Attorney's license suspended.
ABRAHAMSON, J. concurs and dissents, joined by BRADLEY, A.
ATTORNEY disciplinary proceeding.
[¶1] We review the report of the referee,
Attorney Hannah C. Dugan, recommending that the court suspend
the Wisconsin law license of Attorney James M. Schoenecker
for professional misconduct for a period of one year,
effective February 10, 2015, which is the date the Office of
Lawyer Regulation (OLR) filed its complaint in this matter.
The referee also recommended that the court order Attorney
Schoenecker to pay one-half of the costs of this disciplinary
proceeding. The referee wrote the report following the entry
of a stipulation between Attorney Schoenecker and the OLR
concerning Attorney Schoenecker's dishonest business
activities as a member of a limited liability company that he
helped to form. Neither party has appealed from the
referee's report and recommendation, and thus our review
proceeds under Supreme Court Rule (SCR)
[¶2] We conclude that the referee's
findings of fact are supported by satisfactory and convincing
evidence. We also agree with the referee's conclusions of
law that Attorney Schoenecker engaged in professional
misconduct, and that the seriousness of this misconduct
warrants a one-year suspension of Attorney Schoenecker's
law license. We part ways with the referee in holding that,
given the timing and seriousness of Attorney
Schoenecker's misconduct, the suspension of his law
license should not be retroactive, but rather should be made
effective as of the date of this order. Finally, we agree
with the referee that Attorney Schoenecker should pay
one-half of the OLR's $8,500.59 in costs, for a total of
[¶3] Attorney Schoenecker was licensed to
practice law in Wisconsin in 2004. On July 15, 2011, we
suspended Attorney Schoenecker's law license for
misconduct that included attempting to defraud his client
through law firm invoices; engaging in a pattern of attempted
and completed thefts from his client's bank accounts, for
which he pled guilty to one felony count of identity theft;
and failing to inform his law firm employer that he had set
up his own separate law firm on the side. In re
Disciplinary Proceedings Against Schoenecker, 2011 WI
76, 336 Wis.2d 253, 804 N.W.2d 686. The three-year
suspension, which went into effect on August 15, 2011, would
have ended on August 15, 2014. Attorney Schoenecker's
license remains suspended.
[¶4] On February 10, 2015, the OLR filed a
two-count complaint in this case, which alleged that Attorney
Schoenecker engaged in the unauthorized practice of law,
contrary to SCR 10.03(4)(a) and SCR
22.26(2), as enforced via SCR
20:8.4(f), and engaged in conduct involving
dishonesty, fraud, deceit, or misrepresentation, in violation
of SCR 20:8.4(c). Attorney Schoenecker answered and
denied all misconduct. In August 2015, the OLR amended its
complaint by dropping the unauthorized practice of law
charge, while maintaining the charge of engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation.
See SCR 20:8.4(c).
[¶5] The OLR's amended complaint
alleged, and the parties ultimately stipulated, that the
misconduct in this case concerns Attorney Schoenecker's
involvement in a business partnership that he entered into in
2012 with two other individuals, M.M. and T.H. Attorney
Schoenecker, on behalf of himself and his partners,
established a limited liability company named GameMaster,
LLC. Attorney Schoenecker drafted and filed the organizing
documents, including the Articles of Organization and the
Limited Liability Company Operating Agreement.
[¶6] In May 2012, T.H. gave Attorney
Schoenecker $25,000 in cash as his capital contribution. In
August 2012, M.M. made a $20,000 capital contribution.
[¶7] Attorney Schoenecker set up a business
checking account in the name of GameMaster, LLC. The bank
issued Attorney Schoenecker a bank card allowing him to
charge to the account as well as withdraw funds. Attorney
Schoenecker also had the bank issue him an American Express
corporate card to use for business expenses.
[¶8] Attorney Schoenecker did not
immediately deposit T.H.'s $25,000 cash contribution into
any GameMaster, LLC account. Instead, Attorney Schoenecker
deposited the bulk of T.H.'s cash into his own personal
[¶9] The OLR conducted an investigation of
the GameMaster, LLC business account statements for the
period of May 30, 2012 through October 2013. The
investigation revealed that:
(a) Attorney Schoenecker repeatedly charged personal
expenses to the company.
(b) Attorney Schoenecker repeatedly used company funds to
pay his own credit card bills.
(c) Attorney Schoenecker repeatedly wrote company checks to
pay his own personal expenses.
(d) Attorney Schoenecker used the company debit card to
make ATM withdrawals at Potawatomi Casino.
(e) Attorney Schoenecker repeatedly charged personal
expenses to the company American Express card.
(f) Attorney Schoenecker undertook use of company funds
without preapproval from either of his business partners.
(g) Attorney Schoenecker charged significant personal
expenses to the GameMaster, LLC business account. Included
in those expenses were charges to Potawatomi Casino, Apple
iTunes, a cellular telephone company, and a variety of fast
food, gasoline, and other businesses, all without
preapproval from his partners.
[¶10] On September 2, 2015, the OLR and
Attorney Schoenecker filed a stipulation whereby Attorney
Schoenecker withdrew his answer to the original complaint and
pled no contest to the single SCR 20:8.4(c) violation alleged
in the OLR's amended complaint. In so doing, Attorney
Schoenecker agreed not to dispute the OLR's charge that,
as Chief Executive Manager of GameMaster, LLC, he failed to
account clearly or timely for capital contributions made by
other members, withdrew excessive funds from GameMaster, LLC,
and charged personal expenses to GameMaster, LLC, all without
preapproval from his business partners, in violation of SCR
20:8.4(c). Attorney Schoenecker and the OLR jointly
recommended that the court order a one-year license
suspension imposed retroactively to the date he became
eligible for ...