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In re Disciplinary Proceedings Against Rice

Supreme Court of Wisconsin

January 6, 2017

In the Matter of Disciplinary Proceedings Against Shawn G. Rice, Attorney at Law:
v.
Shawn G. Rice, Respondent. Office of Lawyer Regulation, Complainant,

         ATTORNEY disciplinary proceeding. Attorney's license suspended.

          PER CURIAM.

         ¶1 We review the report of Referee Christine Harris Taylor, concluding that Attorney Shawn G. Rice committed one count of professional misconduct as alleged in the Office of Lawyer Regulation's (OLR) complaint. Referee Taylor recommends the court suspend Attorney Rice's license for a period of 60 days and that we order Attorney Rice to pay the full costs of this disciplinary proceeding.

         ¶2 No appeal was filed from the referee's report so we review this matter pursuant to SCR 22.17(2).[1] After completing our review, we agree that the stipulated facts and the record are sufficient to establish that Attorney Rice violated SCR 20:8.4(c).[2] We further agree that Attorney Rice's license should be suspended for 60 days. We accede to the OLR's conclusion that restitution is not warranted. We deny Attorney Rice's objection to costs and direct him to pay the full costs of this disciplinary proceeding which are $14, 064.72 as of August 29, 2016.

         ¶3 Attorney Rice was admitted to practice law in Wisconsin in 1993. He has been subject to professional discipline on one prior occasion. In 2007, he received a public reprimand for three counts of professional misconduct related to his personal involvement in a commercial real estate transaction in which he made false statements in a deposition and executed a document falsely reflecting an individual as a member of an LLC. In re Disciplinary Proceedings Against Rice, 2007 WI 68, 301 Wis.2d 94, 732 N.W.2d 440.

         ¶4 This matter came to the OLR's attention during Rice's acrimonious divorce proceeding. In 1996, Attorney Rice and Ms. Liesl M. Testwuide (Ms. Testwuide) were married. In 1992, when Ms. Testwuide was still unmarried and childless, Ms. Testwuide's parents created a trust for the benefit of Ms. Testwuide and her children. Ms. Testwuide was co-trustee of the trust along with Kenneth Kazmierczak, a business associate of Ms. Testwuide's father.

         ¶5 In 2010, Ms. Testwuide filed for divorce. In July 2011, while the divorce was pending, Ms. Testwuide filed a grievance with the OLR alleging that Attorney Rice had removed over $600, 000 from the trust without proper authorization by forging Ms. Testwuide's signature and the signature of her co-trustee. Attorney Rice self-reported the same misconduct and, in October 2011, Attorney Rice submitted a lengthy written response to the grievance acknowledging that he signed documents without proper authorization but asserting Ms. Testwuide knew and tacitly approved his actions. Ms. Testwuide and Attorney Rice's divorce judgment was entered in October 2011; they continued to litigate custody, placement, and other issues.

         ¶6 On November 21, 2011, Ms. Testwuide filed a civil action against Attorney Rice and his former law firm, alleging fraud, conversion, and legal malpractice. Testwuide v. Rice, 2011CV1184, Sheboygan County. On December 18, 2012, the circuit court granted Rice's motion for summary judgment, ruling that several claims were barred by the statute of limitations. In May 2013, a stipulation and order dismissing the remaining claims against Rice was entered.

         ¶7 On October 2, 2014, the OLR filed a disciplinary complaint alleging that Attorney Rice violated SCR 20:8.4(c) by forging the signatures of the co-trustees of the Liesl M. Testwuide 1992 Trust on various checks and documents. Initially, the OLR sought a six month license suspension. In July 2015, after pretrial discovery, the OLR and Attorney Rice executed a "Stipulation Regarding Factual Allegations and Disciplinary Charge." Attorney Rice admitted that he violated SCR 20:8.4(c) by preparing and executing, without authorization, numerous forms, checks and other Trust documents for a 12-year period during the marriage and continuing until Ms. Testwuide filed for divorce in 2010.

         ¶8 The referee accepted the stipulation. The parties continued to dispute the appropriate discipline and conducted additional discovery, including depositions.

         ¶9 Attorney Rice maintained that, under the circumstances, a public reprimand was sufficient. On April 15, 2016, days before a scheduled evidentiary hearing, the OLR reduced its recommendation from a six-month license suspension to a 60-day license suspension. Attorney Rice continued to assert that a public reprimand was sufficient, but the parties agreed to waive the scheduled hearing and permit the referee to resolve the question of appropriate discipline based on the stipulation, the existing record, and the parties' written submissions.

         ¶10 The referee issued her report and recommendation dated August 9, 2016. Neither party appealed.

         ¶11 When we review a referee's report and recommendation in an attorney disciplinary case, we affirm the referee's findings of fact unless they are found to be clearly erroneous, but we review the referee's conclusions of law on a de novo basis. In re Disciplinary Proceedings Against Inglimo, 2007 WI 126, ¶5, 305 Wis.2d 71, 740 N.W.2d 125. We determine the appropriate level of discipline to impose given the particular facts of each case, independent of the referee's recommendation, but benefiting from it. In re Disciplinary Proceedings Against Widule, 2003 WI 34');">2003 WI 34, ¶44, 261 Wis.2d 45, 660 N.W.2d 686.

         ¶12 There is no showing that the referee's factual findings are clearly erroneous and we accept them. The complaint alleges, Attorney Rice has stipulated, and the record supports the finding that Attorney Rice arranged for numerous checks and disbursals from the trust account, without ...


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