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The Florida Bar v. Paul D. Friedman
SC02-2430
GOOD MORNING, SIR. MAY IT PLEASE THE COURT I AM BOB JOSEFSBERG AND I'M HERE WITH MY CLIENT PAUL FRIEDMAN. I'M NOT HERE TO RENEG ON HIS AGREEMENT. HE ENTERED INTO AN AGREEMENT MORE THAN THREE YEARS AGO AND ALTHOUGH WE DIDN'T LIKE IT THEN AND WE DON'T LIKE IT NOW HE SIGNED IT AND HIS WORD IS. I PUT THAT IN THE BEGINNING OF THE BRIEFS. THE ONLY REASON HE IS HERE BECAUSE YOU ASKED HIM TO COMMENT. >> HIS AGREEMENT INCLUDES THE FUNDS AND ALSO A SUSPENSION. IS THAT CORRECT? >> CORRECT. AND ONE OF YOU QUESTIONED BEFORE WHETHER THAT -- WHY SOMEONE WOULDN'T DO THAT UNTIL THEY WERE ORDERED TO DO IT. HE DID IT BEFORE. IT'S IN THE AGREEMENT. HE DID IT BEFORE THE AGREEMENT. HE DID IT BEFORE THE PROCEEDING. >> THAT SOUNDS LIKE HE IS -- THAT'S VERY IMPRESSIVE. AND I ACTUALLY FORGET TO ASK THE OTHERS CASE THAT -- ABOUT WHETHER THEY STARTED DOING THEIR PRO BONO HOURS THAT WERE ORDERED. JUSTICE AND THESTED MENTIONED DISGEORGEMENT IT PHRASED IN TERMS OF RESTITUTION. AND I DON'T WANT TO GET CONFUSED BETWEEN THE CASES. DID THIS ARISE BECAUSE HE WAS SUED BY THE CLIENTS? >> YES. >> AND AS FAR AS THE SETTLEMENT HE PLAY -- PAID CLIENTS 910,000. WAS IT BECAUSE OF THE BAR CASE OR BECAUSE OF THE LAWSUIT THAT'S 910,000 WAS PAID? >> HE PAID IT IN THE CIVIL LAWSUIT IN BY THE CLIENTS SUED HIM AND ALL THE OTHERS. >> SO THAT'S -- SO IN THAT HOW IS THAT, THAT HE DID THIS BECAUSE THE BAR -- BECAUSE THE BAR -- BAR AGREEMENT. >> HE WASN'T REQUIRED BY THE BAR AGREEMENT. THERE WAS NO BAR AGREEMENT WHEN HE PAID. HIS -- HE PAID IT BEFORE. >> HE SETTLED A LAWSUIT IN WHICH HE WAS SUED. >> HE PAID IT BECAUSE TEN YEARS AGO WHEN THIS SECRET SIDE AGREEMENT WAS ENTERED INTO AND SHORTLY THEREAFTER HE LEARNED ABOUT IT AND HE MADE THE TERRIBLE MISTAKE WHICH IS WHY HE IS HERE OF DOING NOTHING. >> IS THAT THE TOTAL AMOUNT OF HIS SHARE OF THE AGREEMENT? >> IT WAS THE AMOUNT THAT BOTH THE PLAINTIFF'S LAWYERS IN THAT CASE AND THE BAR AGREED WAS 60% OF WHAT HE RECEIVED BECAUSE THE REST WAS PAID IN TAXES. IT WAS A TOTAL DISGORGMENT. WHAT GETS INTERESTING ABOUT IT AND I DON'T WANT TO GET INVOLVED IN THE OTHER CASES IN TERMS OF RESTITUTION, I DON'T KNOW THAT THESE PLAINTIFFS NEEDED THIS MONEY OR DESERVED IT IN TERMS OF RESTITUTION. I'M NOT GOING TO GET INVOLVED IN THE CLIENT'S SECURITY FUND. THE ONE THING THAT MY CLIENT DID FEEL AND DOES FEEL IS HE DID NOT WANT THESE ILL-GOTTEN GAINS. STARTING FROM TEN YEARS AGO HE WAS UNCOMFORTABLE WITH IT. AND WHEN THIS AROSE HE PAID IT. [INAUDIBLE] HE DID. HE DID. HE DID AND HE WAS SILENT AND HE DIDN'T DO ANYTHING. AND AT THE TIME -- THE SUSPENSION THAT HE AGREED TO WAS 90 DAY; RIGHT? >> YES. >> WHICH WOULD PERMIT HIM TO THEN GO BACK TO BECOMING A PRACTICING ATTORNEY WITHOUT GOING THROUGH THE REHABILITATION PROCESS. CORRECT. >> CORRECT. AS OPPOSED TO 91 DAYS. >> AND MY CONCERN IS YOUR CLIENT IS -- AS YOU JUST STATED HAS ADMITTED THAT WHAT HE DID WAS WRONG BECAUSE HE DIDN'T DISCLOSE TO HIS CLIENT WHICH HE HAD AN OBLIGATION TO DO THAT HE WAS MAKING A MILLION DOLLARS WHICH THEY DIDN'T KNOW ANT. CORRECT? THAT'S WHAT HE AGREED TO DO. >> YES, YOUR HONOR. WITH THIS SLIGHT VARIATION HE WASN'T ONE OF THE PEOPLE INVOLVED IN THIS CASE. HE NEVER MET ANY OF THESE CLIENTS BEFORE OR AFTER. >> HE'S A PARTNER IN THIS LAW FIRM. >> HE IS AND HE RESPONSIBLE FOR THAT. HE KNEW WHAT WAS GOING ON AT THE TIME. >> NO. HE DIDN'T KNOW IT WAS GOING ON WHEN HE RECEIVED THE MILLION DOLLARS. >> THAT HE KNEW. BUT HE DID NOT KNOW ANY OF THE OTHER DETAILS ABOUT. >> MY CONCERN IS THAT WHAT ARE WE HOLDING OUT BY THIS 90-DAY SUSPENSION TO IF 70,000 LAWYERS IN FLORIDA THAT THEY ARE NOT GOING TO HAVE A REHABILITATED SUSPENSION WHEN THEY ACCEPT THAT TYPE OF RF EMUNIRATION IN AN UNDER-THE-TABLE DEAL THAT THEIR CLIENT DOESN'T KNOW ABOUT. IS THAT A GOOD REPRESENTATION? >> I THINK THE LAWYERS SHOULD BE DETERRED FROM THIS BEHAVIOR. AND ANYONE WHO LOOKS AT WHAT HAPPENED TO PAUL FRIEDMAN WOULD BE DEFERRED. HE IS -- HE HAS SUFFERED FOR TEN YEARS. THREE YEARS AGO -- FOUR YEARS AGO AND TWO MONTHS AGO HIS STATEMENT WAS TAKEN, HIS DEPOSITION AND IT WAS MEA CULPA. HE SAID I'M WRONG. I'M SORRY. AND HE NEGOTIATED AS QUICKLY AS HE COULD, A DEAL. THE THOUGHT IT WAS AN UNFAIR ONE BUT HE WANTED CLOSURE. BECAUSE HE'S NOT USED TO CARRYING SIN AND WRONGDOING. AND HE SAID TO THE BAR THREE YEARS AGO I WANT CLOSURE. I'M WILLING TO BE PUNISHED. WHAT YOU JUST SAID SEEMS TO BE SO UNCONTRADICTORY THAT HE DID A MEA CULPA BUT HE THOUGHT IT WAS UNFAIR. >> NO. NO. EITHER HE AGREES THAT WHAT HE TK DID WAS IN VIOLATION OF THE RULES OF ETHICS OR HE DOESN'T. IT'S NOT THAT IT WAS UNFAIR. >> HE DIDN'T SAY IT WAS UNFAIR. THAT HE BE REPRIMANDED. HE DIDN'T SAY IT WAS UNFAIR THAT HE BE SANCTIONED. THE FACT THAT IT WAS 90 DAYS CAME ABOUT IN NEGOTIATION. >> JUSTICE CANTERO HAD A QUESTION. I THOUGHT IN YOUR SUPPLEMENTAL BRIEFS YOU ARGUED THAT BECAUSE OF THE LAPSE OF TIME SINCE THE CONSENT JUNKMENT THAT IT WAS NO LONGER FAIR TO SUSPEND HIM FOR 90 DAYS. ARE YOU NOT MAKING THAT ARGUMENT? >> I DO ARGUE THAT. AND I ARGUE IF PAUL FRIEDMAN HAD AN OPPORTUNITY TO OPPORTUNITY IN 90 DAYS, THREE YEARS AGO, HE WOULD HAVE. THE REASON THIS CAME BEFORE YOU IN THE RULE OF SHOW CAUSE, WE WERE MOVING AS HE WANTED TO BE PUNISHED. AND WHEN THE CASE WAS DELAYED FOR VARIOUS REASONS I CALLED. -- I CALLED THE COURT. WHAT'S DELAYING. I CAUGHT BACK THE RULE OF SHOW CAUSE. WE AGGRESSIVE I WILL SAID PLEASE DON'T WAIT FOR THE OTHER TWO. WE WON'T BE COLLATERALLY ESTOPPED BY WHAT HAPPENS IN THOSE CASES. HE WANTS THE CONSENT DECREE. >> YOU HAVE ABOUT TWO MINUTES IF YOU WANT TO RESERVE SOME TIME. >> YES, I DO. >> AND HE -- FOR THREE YEARS IT'S BEEN HANGING IN THE WIND. THE THREE YEARS IT'S BEEN WAITING. NOT ABLE TO GET INVOLVED IN COMPLEX CASES. WAITING TO GET AN ORDER FROM YOU TO CLOSE UP. THAT'S A MORE SERIOUS PIN -- PUNISHMENT THAN 90 DAY SUSPENSION. >> THE FLORIDA BELIEVES THE CONSENT JUDGMENT IS THE APPROPRIATE DISCIPLINE IN THIS CASE. FOR A LOT OF REASONS THIS CASE IS MORE SERIOUS THAN DIANE FERRARO BECAUSE DIANE FERRARA PLED GUILT TO ONLY THREE RULE VIOLATIONS. MR. FRIEDMAN. SEVEN. THE ADDITIONAL FOUR INCLUDE SOME SERIOUS MATTERS. THEY INCLUDE THE INTEREST ON THE CLIENT'S TRUST FUND AND THE TRUST ACCOUNT VIOLATION COMMINGLING THE FUNDS. THIS IS SERIOUS. IT'S MUCH MORE SERIOUS THAN A PUBLIC REPRIMAND. >> SO I UNDERSTAND IT HE WAS THE TREASURE OF THE CORPORATION. >> AT SOMETIMES HE HE WAS. HE WAS A BANKING LAWYER AND THE ONE WHO HANDLED THE MONEY. >> SO HE ACTUALLY GOT THE MONEY AND THAT'S THE ONE WHO PUT IT IN THIS ACCOUNT, WAS THE ACCOUNT THAT ALSO INCLUDED ALL THE FUNDS. >> YES, THAT'S CORRECT. BOTTOM LINE FOR THE BAR -- >> GO AHEAD. THE BOTTOM LINE FOR THE BAR IS THAT THE BAR STANDS BY THE STIPULATION THAT IT ENTERED INTO IN THIS CASE. >> YES, JUSTICE ANSTEAD. >> JUSTICE PARIENTE. >> DO WE HAVE A COPY OF THE DEPOSITION IN WHICH HE BASICALLY SAYS WHAT I DID WAS WRONG? IS THAT IN OUR RECORD? >> THAT IS NOT IN OUR RECORD. BUT I WAS PRESENT AND I WILL TELL THE COURT THAT MR. FRIEDMAN DID SAY THE SAME THING BEFORE THE GRIEVANCE COMMITTEE EVEN EARLIER. >> WHY DON'T WE FILE A COPY OF THE DEPOSITION? CAN THAT BE DONE? >> OF COURSE. THE QUESTION I HAVE HAS TO DO WITH THIS ISSUE OF DISGORGMENT VERSUS REST STRAEUGS VERSUS SETTLEMENT OF A LAW. CAN YOU DESCRIBE HOW THE 910,000 CAME ABOUT. >> THE 910,000 AS YOU KNOW -- >> I UNDERSTAND THIS IS 60% OF -- BUT IN OTHER WORDS WHO SUED MR. FRIEDMAN? AND THEN WAS THAT MONEY PAID THEN TO ALL OF THE CLIENTS THAT WOULD HAVE OTHERWISE I GUESS BENEFITTED IF THE 6 MILLIONION HAD BEEN ADDED ON TO THEIR SETTLEMENT. >> YES. THE GILLYS WEREN'T HAPPY WITH THEIR SETTLEMENT. THEY HIRED MR. OSINSKY. THEY BROUGHT A LAWSUIT AGAINST DuPONT AND THE OTHERS. THEN LATER ON THERE WAS A SETTLEMENT. THE SETTLEMENT WAS 910,000 IN HIS CASE. I CATEGORIZED IT IN THE CONSENT JUDGMENTS AS RESTITUTION BECAUSE I DIDN'T KNOW WHAT ELSE TO CALL IT. IT WENT BACK TO THE CLIENTS. SO IT WAS DISGORGMENT. BUT IN ANY EVENT BECAUSE IT WENT BACK TO THE CLIENTS I PUT IN THE CONSENT JUDGMENT THAT IT WAS REST STRAOUGS. >> THE BARS HAD PLENTY OF TIME WITH REFERENCE TO THE CONSIDERATION OF THESE OTHER CASES AND THE PROPORTION TPHALTILITY ISSUE THAT WE DISCUSSED. AND THE BAR HAS TAKEN THAT INTO CONSIDERATION IN STANDING BY THE STIPULATION. IS THAT CORRECT? >> THAT'S CORRECT. AND WE DO BELIEVE THAT OUR RECOMMENDATIONS WITH REGARD TO MR. RODRIQUEZ AND MR. ST. LOUIS ARE THE PERFECTLY APPROPRIATE DISCIPLINE FOR THEM AND WE FEEL THAT THIS IS PROPORTIONATE WITH REGARD TO THE CULPABILITY. NOW, OF COURSE, IF THIS COURT FEELS THAT MR. ST. LOUIS AND MR. RODRIQUEZ SHOULD BE TREATED MORE LENIENTLY, THEN MR. FRIEDMAN SHOULD NOT BE PUNISHED MORE SEVERELY THAN THE PRIMARY CULPRIT. THANK YOU. [INAUDIBLE] SO MR. FRIEDMAN SHOULD HAVE MORE THAN A 90-DAY SANCTION. THEN WE WOULD HAVE TO GO THROUGH THE WHOLE THING OF SENDING AND HEARING BEFORE A REEFREE AND ALL THAT. CORRECT? >> AS FAR AS I KNOW THIS COURT CAN DO WHATEVER IT WANTS. I DON'T THINK SO. >> IT SEEMS TO ME A CONSENT JUDGEMEND IS BASED ON THE FACT THAT IT WOULD -- IT'S -- IF NOT APPROVED THE RESPONDENT THENS THAT RIGHT TO PRESENT EVIDENCE IN MITIGATION EVEN TO CONTENT THE CHARGES. WE CAN'T SAY WE REJECT THE CONSENT JUDGMENT. WE WILL GIVE YOU TWO YEARS. THE CONSENT JUDGMENT IS BASED ON AN AGREEMENT IN 90 DAYS. >> YOU'RE CORRECT JUSTICE CANTERO. >> THAT'S WHAT HE WANTED E NOTHING WHAT HAPPENED SUBSEQUENTLY CHANGES THE BAR'S THOUGHT THAT MR. FRIEDMAN IS LESS CULPABLE THAN MR. ST. LOUIS AND MR. RODRIQUEZ. >> NO. WE STILL BELIEVE THAT HE'S MUCH LESS CULPABLE BECAUSE -- >> THAT'S WHAT -- NOTHING CHANGED THAT HE IS LESS CULPABLE. >> NO. >> THANK YOU. MR. JOSEFSBERG, I WILL GIVE YOU A COUPLE OF MINUTES HERE. IF THIS COURT WOULD REJECT THE CONSENT AGREEMENT AND WENT BACK THEN WHATEVER WEIGHT THERE IS IN MY ARGUMENT ABOUT THE DELAY. WHICH WE HAVE NOT CAUSE WE WOULD BE ACCENTUATED WHEN WE CAME BACK HERE AND INSTEAD OF 3 1/2 YEAR DELAY WE HAVE A FIVE-YEAR DELAY. >> I TUESDAY WORD "DEPOSITION." >> IT WAS A STATEMENT IN THE GRIEVANCE PROCEEDING. OR REPORTED SWORN STATEMENT. NEVER ANY DOUBT IN HIS MIND THAT IT WAS IMPROPER IN 1996 TO HAVE A SIDE AGREEMENT. >> IN '96 HE QUESTIONED IT. THEY DID SOME RESEARCH. HE WAS TOLD HE WOULD BE TOLD ABOUT IT. WHEN HE WASN'T TOLD IT HAD ALREADY BEEN DONE AND HE DID NOTHING. IN '96 HE QUESTIONED IT. HE WASN'T SURE. ONCE HE WENT INTO IT FURTHER HE DETERMINED IT WAS WRONG. >> AFTER HE WAS SUED? >> BEFORE HE WAS SUE. >> THE REASON I HAVE A CONCERN BECAUSE THERE WAS SOME LAWYERS IN SOME OF THE OTHER CASES THAT SEEMS TO HAVE SAID STRAIGHT OUT THAT THIS TYPE OF CONDUCT WASN'T A VIOLATION OF THE RULE AND THAT CONCERNS ME THAT WE'VE GOT MEMBERS OF THE BAR THAT THINK THERE'S A GRAY AREA ON SOMETHING LIKE THIS. >> I NEVER THRASH ALLIES. BUT IN TERMS OF HIS BEING CONTRITE AND HIS ADMITTING IT HEED A ADMITTED IT. HE HAS SO TESTIFIED AT THE TRIALS OF THE DEPARTMENT HE HAS BEEN TOTALLY COOPERATIVE AND HE HAS SAID I NOW KNOW AND I SHOULD HAVE KNOWN THEN THAT THIS WAS WRONG. >> MR. FRIEDMAN WAS NOT INVOLVED IN DEALING WITH CLIENTS AFTER THE AGREEMENT AND SO THERE'S NO ISSUE ABOUT HIS FAILING TO INFORM CLIENTS OF THE AGREEMENT. >> CORRECT. HE WASN'T INVOLVED WITH THEM BEFORE, DURING AFTER OR WITH THE BAR IN THE ORIGINAL PROCEEDINGS. >> HE HAS NONE OF THAT. BUT HE'S THEIR PARTNER. >> JUSTICE WELLS, YOU ARE CORRECT. HE'S HERE BECAUSE HE IS PART OF IT AND HE'S RESPONSIBLE. >> YOU HAVE NOW USED UP YOUR TIME. >> THANK YOU. >> THANK YOU VERY MUCH FOR THE ARGUMENT. WE WILL TAKE THE CASE UNDER ADVISEMENT. RATHER THAN TAKING OUR NORMAL RECESS WE WILL PROCEED WITH THE NEXT CASE OF THE FLORIDA BAR. >>