Case Number(s): 10-O-05513
In the Matter of: Gary Michael Walters Bar #134769, A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Agustin Hernandez Deputy Trial Counsel
1149 South Hill Street
Los Angeles, CA 90015-2299
(213) 765-1713
Bar #161625
Counsel for Respondent: Ellen A. Pansky, 1010 Sycamore Ave., Suite 308
South Pasadena, CA 91030
(213) 626-7300
Bar #77688
Submitted to: Assigned Judge
<<not>> checked. PREVIOUS STIPULATION REJECTED
Note: All information required by this form and any additional information which cannot be provided in the space provided, must be set forth in an attachment to this stipulation under specific headings, e.g., "Facts," "Dismissals," "Conclusions of Law," "Supporting Authority," etc.
1. Respondent is a member of the State Bar of California, admitted June 14, 1988.
2. The parties agree to be bound by the factual stipulations contained herein even if conclusions of law or disposition are rejected or changed by the Supreme Court.
3. All investigations or proceedings listed by case number in the caption of this stipulation are entirely resolved by this stipulation and are deemed consolidated. Dismissed charge(s)/count(s) are listed under "Dismissals." The stipulation consists of 12 pages, not including the order.
4. A statement of acts or omissions acknowledged by Respondent as cause or causes for discipline is included under "Facts."
5. Conclusions of law, drawn from and specifically referring to the facts are also included under "Conclusions of Law".
6. The parties must include supporting authority for the recommended level of discipline under the heading "Supporting Authority."
7. No more than 30 days prior to the filing of this stipulation, Respondent has been advised in writing of any pending investigation/proceeding not resolved by this stipulation, except for criminal investigations.
8. Payment of Disciplinary Costs-Respondent acknowledges the provisions of Bus. & Prof. Code §§6086.10 & 6140.7. (Check one option only):
checked. Until costs are paid in full, Respondent will remain actually suspended from the practice of law unless relief is obtained per rule 5.130, Rules of Procedure.
<<not>> checked. Costs are to be paid in equal amounts prior to February 1 for the following membership years: (Hardship, special circumstances or other good cause per rule 5.132, Rules of Procedure.) If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
<<not>> checked. Costs are waived in part as set forth in a separate attachment entitled "Partial Waiver of Costs".
<<not>> checked. Costs are entirely waived.
checked. (c) Rules of Professional Conduct/ State Bar Act violations: Rule 4-100(A), Rules of Professional Conduct; Business and Professions Code §6068(a), 6125 and 6126(b).
checked. (d) Degree of prior discipline One year stayed suspension, no actual suspension, and two years of probation.
checked. (e) If Respondent has two or more incidents of prior discipline, use space provided below.
(a) State Bar Court Case No. 06-PM-10722
(b) Discipline effective July 19, 2006.
(c) Respondent’s probation imposed in Case Nos. 03-0-04643; 04-O-10086; 04-O-11972 was revoked pursuant to Business and Professions Code §6093 subds. (b) and (c), and (former) Rules of Procedure rule 560, et seq., for failing to comply with the terms and conditions of probation.
(d) Respondent was actually suspended for one year which is the full period of stayed
suspension in Case Nos. 03-0-04643; 04-0-10086; 04-O-11972.
checked. (2) No Harm: Respondent did not harm the client or person who was the object of the misconduct. The funds at issue were entirely Respondent’s personal funds. There were no client funds involved and there was no harm to ony client. (See page 9.)
WAIVER OF VARIANCE BETWEEN NOTICE OF DISCIPLINARY CHARGES AND
STIPULATED FACTS AND CONCLUSIONS OF LAW
The parties waive any variance between the Notice of Disciplinary Charges filed on January 21, 2011, and the facts and/or conclusions of law contained in this stipulation. Additionally, the parties waive the issuance of an amended Notice of Disciplinary Charges. The parties further waive the right to the filing of a Notice of Disciplinary Charges and to a formal hearing on any charge not included in the pending Notice of
Disciplinary Charges.
IN THE MATTER OF: State Bar No.
STATE BAR COURT CASE NUMBER:
ATTACHMENT TO STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION
IN THE MATTER OF: GARY MICHAEL WALTERS
CASE NUMBER: 10-O-05513
FACTS AND CONCLUSIONS OF LAW.
Respondent admits that the following facts are true and that he is culpable of violations of the specified statutes and/or Rules of Professional Conduct.
Case No. 10-O-05513 (Complainant: State Bar Investigation)
FACTS:
1. At all relevant times herein, Respondent maintained a client trust account at Union Bank, account no. xxxxxx7001 (hereinafter "CTA").
2. Between July 9, 2009 and October 25, 2009, Respondent issued checks drawn upon his CTA to pay for his personal and business expenses as follows:
Date Issued: Amount: Payee:
Check No. 1524, Date Issued 07/09/09, Amount: $10,000, Payee: Gary Walters
Check No. 1525, Date Issued 08/11/09, Amount: $2,000, Payee: Cash
Check No. 1535, Date Issued 10/04/09, Amount: $9,970, Payee: Bold Films
Check No. 1512, Date Issued 10/25/09, Amount: $1,000, Payee: Tyler Shields
3. These checks were drawn entirely upon Respondent’s personal funds that he improperly maintained in his CTA.
4. On June 4, 2010, the State Bar opened an investigation regarding this matter (hereinafter ’°CTA matter").
5. On July 16, 2010, and August 31, 2010, a State Bar Investigator sent letters to Respondent regarding the CTA matter. The State Bar Investigator’s letters requested that Respondent respond in writing to specified allegations of misconduct being investigated by the State Bar in the CTA matter. Respondent received the letters.
6. At no time did Respondent provide a written response to the allegations of misconduct in the CTA matter.
CONCLUSIONS OF LAW:
7. By maintaining personal funds in his CTA and issuing checks from his CTA to pay for his personal and business expenses, Respondent misused his CTA, in wilful violation of rule 4-100(A), Rules of Professional Conduct.
8. By not providing a written response to the investigator’s letters regarding the allegations in the CTA matter or otherwise cooperate in the investigation of the CTA matter, Respondent failed to cooperate in a disciplinary investigation in wilful violation of Business and Professions Code, section 6068(i).
PENDING PROCEEDINGS.
The disclosure date referred to, on page 2, paragraph A(7), was April 15, 2011.
AUTHORITIES SUPPORTING DISCIPLINE.
Standards
Standard 1.3, Title IV, Standards for Attorney Sanctions for Professional Misconduct, provides that the primary purposes of the disciplinary system are: "the protection of the public, the courts and the legal profession; the maintenance of high professional standards by attorneys and the preservation of public confidence in the legal profession."
Standard 1.7(a) provides that if a member has a prior imposition of discipline, "the degree of discipline imposed in the current proceeding shall be greater than that imposed in the prior proceeding unless the prior discipline imposed was so remote in time to the current proceeding and the offense for which it was imposed was so minimal in severity that imposing greater discipline in the current proceeding would be
manifestly unjust."
Standard 1.7(b) provides that "[i]f a member is found culpable of professional misconduct in any proceeding in which discipline may be imposed and the member has a record of two prior impositions of discipline as defined by Standard 1.2(f), the degree of discipline in the current proceeding shall be disbarment unless the
most compelling mitigating circumstances clearly predominate."
Standard 2.2(b) states that culpability of a member of commingling of entrusted funds or property with personal property or the commission of another violation of rule 4-100, Rules of Professional Conduct, none of which offenses result in the wilful misappropriation of entrusted funds or property shall result in at least three month actual suspension from the practice of law, irrespective of mitigating circumstances."
Standard 2.6(a) provides that Respondent’s violation of Business and Professions Code, section 6068(i) shall result in suspension or disbarment "depending on the gravity of the offense or the harm, if any, to the victim, with due regard to the purposes of imposing discipline set forth in standard 1.3."
Case Law
The Supreme Court has emphasized the importance of the standards and has held that great weight should be given to the application of the standards in determining the appropriate level of discipline. (In re Silverton (2005) 36 Cal. 4th 81 .) The standards must be followed unless there is a compelling reason justifying a deviation from the standards. (In the Matter of Bouyer (Review Dept. 1991) 1 Cal. State Bar Ct.
Rptr. 404.) The Supreme Court has held that unless it has "grave doubts as to the propriety of the recommended discipline," it will uphold the application of the standards. In re Silverton, supra, 36 Cal. 4th at p. 91-92.
Case law supports an actual suspension of at least three months as provided for in standard 2.2(b) for misusing a client trust account. (In the Matter of Doran (Review Dept. 1998) 3 Cal. State Bar Ct. Rptr. 871; In the Matter of Koehler (Review Dept. 1991) 1 Cal. State Bar Ctr. Rptr. 615.)
In this case, Respondent’s two prior impositions of discipline are a significant factor in aggravation. Although standard 1.7(b) provides for disbarment when an attorney has two prior impositions of discipline, in this matter, disbarment is not necessary to for the protection of the public. Respondent is entitled to mitigation as discussed above on pages 3 and 4. The funds at issue were entirely Respondent’s personal funds. There were no client funds involved and there was no harm to any client. Nonetheless, substantial discipline is still warranted. A two year stayed suspension with eighteen (18) months of actual suspension and three years of probation are sufficient to protect the public, the courts and the legal profession.
DISMISSALS.
The parties respectfully request the Court to dismiss the following alleged violations in the interest of justice:
Case No. Count Alleged Violation
10-O-05513 Two Business and Professions Code, section 6106
Case Number(s): 10-O-05513
In the Matter of: Gary Michael Walters
a. Restitution
<<not>> checked. Respondent must pay restitution (including the principal amount, plus interest of 10% per annum) to the payee(s) listed below. If the Client Security Fund (“CSF”) has reimbursed one or more of the payee(s) for all or any portion of the principal amount(s) listed below, Respondent must also pay restitution to CSF in the amount(s) paid, plus applicable interest and costs.
1. Payee:
Principal Amount:
Interest Accrues From:
2. Payee:
Principal Amount:
Interest Accrues From:
3. Payee:
Principal Amount:
Interest Accrues From:
4. Payee:
Principal Amount:
Interest Accrues From:
<<not>> checked. Respondent must pay above-referenced restitution and provide satisfactory proof of payment to the Office of Probation not later than
<<not>> checked. Respondent must pay the above-referenced restitution on the payment schedule set forth below. Respondent must provide satisfactory proof of payment to the Office of Probation with each quarterly probation report, or as otherwise directed by the Office of Probation. No later than 30 days prior to the expiration of the period of probation (or period of reproval), Respondent must make any necessary final payment(s) in order to complete the payment of restitution, including interest, in full.
1. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
2. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
3. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
4. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
<<not>> checked. If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
<<not>> checked.
1. If Respondent possesses client funds at any time during the period covered by a required quarterly report, Respondent must file with each required report a certificate from Respondent and/or a certified public accountant or other financial professional approved by the Office of Probation, certifying that:
a. Respondent has maintained a bank account in a bank authorized to do business in the State of California, at a branch located within the State of California, and that such account is designated as a “Trust Account” or “Clients’ Funds Account”;
b. Respondent has kept and maintained the following:
i. A written ledger for each client on whose behalf funds are held that sets forth:
1. the name of such client;
2. the date, amount and source of all funds received on behalf of such client;
3. the date, amount, payee and purpose of each disbursement made on behalf of such client; and,
4. the current balance for such client.
ii. a written journal for each client trust fund account that sets forth:
1. the name of such account;
2. the date, amount and client affected by each debit and credit; and,
3. the current balance in such account.
iii. all bank statements and cancelled checks for each client trust account; and,
iv. each monthly reconciliation (balancing) of (i), (ii), and (iii), above, and if there are any differences between the monthly total balances reflected in (i), (ii), and (iii), above, the reasons for the differences.
c. Respondent has maintained a written journal of securities or other properties held for clients that specifies:
i. each item of security and property held;
ii. the person on whose behalf the security or property is held;
iii. the date of receipt of the security or property;
iv. the date of distribution of the security or property; and,
v. the person to whom the security or property was distributed.
2. If Respondent does not possess any client funds, property or securities during the entire period covered by a report, Respondent must so state under penalty of perjury in the report filed with the Office of Probation for that reporting period. In this circumstance, Respondent need not file the accountant’s certificate described above.
3. The requirements of this condition are in addition to those set forth in rule 4-100, Rules of Professional Conduct.
checked. Within one (1) year of the effective date of the discipline herein, Respondent must supply to the Office of Probation satisfactory proof of attendance at a session of the Ethics School Client Trust Accounting School, within the same period of time, and passage of the test given at the end of that session.
Case Number(s): 10-O-05513
In the Matter of: Gary Michael Walters
By their signatures below, the parties and their counsel, as applicable, signify their agreement with each of the recitation and each of the terms and conditions of this Stipulation Re Facts, Conclusions of Law and Disposition.
Signed by: Gary Michael Walters and Ellen A. Pansky and Agustin Hernandez
Respondent: Gary Michael Walters
Date: April 18, 2011
Respondent’s Counsel: Ellen A. Pansky
Date: April 20, 2011
Deputy Trial Counsel: Agustin Hernandez
Date: April 25, 2011
Case Number(s): 10-O-05513
In the Matter of: Gary Michael Walters
Finding the stipulation to be fair to the parties and that it adequately protects the public, IT IS ORDERED that the requested dismissal of counts/charges, if any is GRANTED without prejudice, and:
checked. The stipulated facts and disposition are APPROVED and the DISCIPLINE RECOMMENDED to the Supreme Court.
<<not>> checked. The stipulated facts and disposition are APPROVED AS MODIFIED as set forth below, and the DISCIPLINE IS RECOMMENDED to the Supreme Court.
checked. All Hearing dates are vacated.
The parties are bound by the stipulation as approved unless: 1) a motion to withdraw or modify the stipulation, filed within 15 days after service of this order, is granted; or 2) this court modifies or further modifies the approved stipulation. (See rule 5.58 (E) & (F), Rules of Procedure.) The effective date of this disposition is the effective date of the Supreme Court order herein, normally 30 days after the file date. (See rule 9.18(a), California Rules of Court.)
Signed by:
Richard A. Platel
Judge of the State Bar Court
Date: May 9, 2011
(Effective January 1, 2011)
Actual Suspension Order
[Rules Proc. of State Bar; Rule 5.27(B); Code Civ. Proc., § 1013a(4)]
I am a Case Administrator of the State Bar Court of California. I am over the age of eighteen and not a party to the within proceeding. Pursuant to standard court practice, in the City and
County of Los Angeles, on May 11, 2011, I deposited a true copy of the following document(s):
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND
DISPOSITION AND ORDER APPROVING
in a sealed envelope for collection and mailing on that date as follows:
checked. by first-class mail, with postage thereon fully prepaid, through the United States Postal Service at Los Angeles, California, addressed as follows:
ELLEN ANNE PANSKY
PANSKY MARKLE HAM LLP
1010 SYCAMORE AVE UNIT 308
SOUTH PASADENA, CA 91030
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
Agustin Hernandez, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles, California, on May 11, 2011
Signed by:
Johnnie Lee Smith
State Bar Court