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In re Tanella

Supreme Court of New York, Second Department

January 9, 2013

In the Matter of Gerard M. Tanella, a suspended attorney. Grievance Committee for the Second, Eleventh, and Thirteenth Judicial Districts, petitioner; Gerard M. Tanella, respondent. (Attorney Registration No. 4145736)

DISCIPLINARY proceeding instituted by the Grievance Committee for the Second, Eleventh, and Thirteenth Judicial Districts. The respondent was admitted to the Bar at a term of the Appellate Division of the Supreme Court in the Second Judicial Department on October 22, 2003. By decision and order on motion of this Court dated May 12, 2011, the respondent was suspended from the practice of law pursuant to 22 NYCRR 691.4(l)(1)(ii) and (iii), the Grievance Committee for the Second, Eleventh, and Thirteenth Judicial Districts was authorized to institute and prosecute a disciplinary proceeding against the respondent based on a petition dated December 3, 2010, and the issues raised were referred to the Honorable Herbert Altman, as Special Referee to hear and report. By decision and order on motion dated November 22, 2011, the Honorable Herbert Altman was relieved as Special Referee, and the matter was reassigned to the Honorable Jerome M. Becker, as Special Referee to hear and report.

Diana Maxfield Kearse, Brooklyn, N.Y. (Myron C. Martynetz of counsel), for petitioner.

Gerard M. Tanella, Brooklyn, N.Y., respondent pro se.

RANDALL T. ENG, P.J., WILLIAM F. MASTRO, REINALDO E. RIVERA, PETER B. SKELOS, MARK C. DILLON, JJ.

OPINION & ORDER

PER CURIAM.

The Grievance Committee for the Second, Eleventh, and Thirteenth Judicial Districts (hereinafter the Grievance Committee) served the respondent with a petition dated December 3, 2010, containing 26 charges of professional misconduct. After a hearing on January 13, 2012, the Special Referee issued a report which sustained all the charges. The Grievance Committee now moves to confirm the Special Referee's report and impose such discipline upon the respondent as the Court deems just and proper. The respondent has submitted papers in opposition to the motion, wherein he asks the Court to disaffirm the report and grant him a new hearing. He claims that on the day of the hearing, his request for an adjournment was denied and, consequently, he was deprived of an opportunity to present character and other medical evidence. The respondent has attached to his opposition papers an affidavit from a former client attesting to the respondent's general character.

Charge 1 alleges that the respondent breached his fiduciary duty, in violation of Code of Professional Responsibility DR 1-102(a)(7) (22 NYCRR 1200.3[a][7]). Between in or about August 2007 and in or about May 2010, the respondent maintained an escrow account entitled "Law Office of Gerard M. Tanella P.C. IOLA Escrow Account" at JPMorgan Chase Bank. Funds entrusted to the respondent as a fiduciary were maintained in the account. On or about October 23, 2008, check no. 1160, drawn against the account in the amount of $10, 679.79, was returned for insufficient funds.

Charge 2 alleges that the respondent failed to maintain required bookkeeping records, in violation of Code of Professional Responsibility DR 9-102(d) and DR 1-102(a)(7) (22 NYCRR 1200.46[d]; 1200.3[a][7]). The respondent failed to maintain a ledger book or similar record of deposits into and withdrawals from his escrow account, as required.

Charge 3 alleges that the respondent failed to safeguard funds entrusted to him as a fiduciary, in violation of Code of Professional Responsibility DR 9-102(e) and DR 1-102(a)(7) (22 NYCRR 1200.46[e]; 1200.3[a][7]). Between in or about August 2007 and in or about May 2010, the respondent maintained a separate operating account entitled "Law Office of Gerard M. Tanella P.C. Operating Account" at JPMorgan Chase Bank. During such period, funds were routinely transferred by wire from the respondent's operating account to his escrow account.

Charge 4 alleges that the respondent failed to safeguard funds entrusted to him as a fiduciary, in violation of Code of Professional Responsibility DR 9-102(b) and DR 1-102(a)(7) (22 NYCRR 1200.46[b]; 1200.3[a][7]). Funds entrusted to the respondent as a fiduciary were required to be deposited into his escrow account. However, fiduciary funds were routinely deposited into the respondent's operating account.

Charge 5 alleges that the respondent allowed one or more nonattorneys to exercise control over his law practice, in violation of Code of Professional Responsibility DR 1-104(c) and DR 1-102(a)(7) (22 NYCRR 1200.5[c]; 1200.3[a][7]). Charge 7 alleges that the respondent shared legal fees with one or more nonattorneys, in violation of Code of Professional Responsibility DR 3-102(a) and DR 102(a)(7) (22 NYCRR 1200.17[a]; 1200.3[a][7]). In or about August 2007, the respondent entered into an agreement with Professional Billing Services, a business owned by nonattorney Inna Lyubronetskaya and/or Gregory Spektor (a nonattorney until his admission to the Bar on November 14, 2007). Spektor assumed unsupervised control over the day-to-day operation of the respondent's law practice. Lyubronetskaya assumed unsupervised control over the respondent's escrow account, as well as his operating account, including, but not limited to, control of all books and records. Lyubronetskaya issued checks on both accounts, to which she affixed a stamp of the respondent's signature. The respondent became a salaried employee of his law practice. At the direction of Spektor and/or Lyubronetskaya, the respondent conducted no-fault litigation to recover payments on behalf of medical providers whose patients ostensibly had been involved in automobile accidents. The attorney's fees generated by that litigation were deposited into the respondent's operating account. Between in or about August 2007 and November 13, 2007, Lyubronetskaya issued checks against those attorney's fees to the order of Spektor. Between in or about August 2007 and in or about May 2010, Lyubronetskaya issued checks against those attorney's fees to herself and/or Professional Billing Services.

Charge 6 alleges that the respondent gave false and/or misleading testimony to the Grievance Committee, in violation of Code of Professional Responsibility DR 1-102(a)(4) and (7) (22 NYCRR 1200.3[a][4], [7]). On April 15, 2010, appearing at the Grievance Committee's office for an examination under oath, the respondent testified falsely that Lyubronetskaya was a "friend" who assisted him "at his request" with escrow account bookkeeping services, while also preparing checks "for his signature" on his escrow account. The respondent also testified falsely that he "personally reviewed" and "signed" the escrow account checks prepared for him by Lyubronetskaya. Moreover, the respondent testified falsely that Lyubronetskaya did not write checks on his operating account.

Charge 8 alleges that the respondent engaged in conduct involving dishonesty, deceit, fraud, and/or misrepresentation, which adversely reflects on his fitness to practice law, in violation of Code of Professional Responsibility DR 1-102(a)(4) and (7) (22 NYCRR 1200.3[a][4], [7]). In or about October 2008, the respondent advised Nelson Segarra and/or his mother, Miriam Velez, that Allstate Insurance (hereinafter Allstate) had offered $100, 000, plus $40, 000 in medical expenses, to settle a personal injury action purportedly filed by the respondent on Segarra's behalf. However, no personal injury action had been filed and no settlement offer had been made. Further, on or about February 3, 2009, the respondent provided Segarra and/or Velez with a purported decision and order of the Civil Court, New York County, which ostensibly directed Allstate to pay the "agreed settlement" within 10 days. The respondent fabricated the decision and order with the intention of misleading Segarra and/or Velez. On or about February 13, 2009, the respondent prepared and sent one or more emails to Velez indicating that the receipt of "settlement draft No. 120356164" was "imminent." The foregoing representation was knowingly false and made with the intention of misleading Segarra and/or Velez.

Charges 9 and 10 allege that the respondent engaged in conduct involving dishonesty, deceit, fraud, and/or misrepresentation, which adversely reflects on his fitness to practice law, in violation of Code of Professional Responsibility DR 1-102(a)(4) and (7) (22 NYCRR 1200.3[a][4], [7]). The respondent was retained by Eddison Bridgeman to represent him in connection with a claim against Lexus of Rockville Centre. Approximately one year later, the respondent advised Bridgeman that his claim had "settled out of court" for $40, 000. In fact, the respondent never engaged in settlement negotiations and/or received a settlement offer on Bridgeman's behalf. Nonetheless, the respondent wrote one or more checks to Bridgeman, ostensibly representing Bridgeman's share of the purported settlement. ...


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