In re Ekekwe-Kauffman ( 2022 )

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 19-BG-1207
IN RE OLEKANMA A. EKEKWE-KAUFFMAN, RESPONDENT.
A Suspended Member of the Bar of the District of Columbia Court of Appeals
(Bar Registration No. 479967)
On Report and Recommendation of the
Board on Professional Responsibility
(16-BD-039)
(Argued February 25, 2021 Decided January 27, 2022)
Olekanma A. Ekekwe-Kauffman, pro se.
Julia L. Porter, Deputy Disciplinary Counsel, with whom Hamilton P. Fox,
III, Disciplinary Counsel, and Myles V. Lynk, Senior Assistant Disciplinary
Counsel, were on the brief, for the Office of Disciplinary Counsel.
Before EASTERLY and DEAHL, Associate Judges, and WASHINGTON, Senior
Judge.
DEAHL, Associate Judge: The Board on Professional Responsibility
unanimously recommends we disbar Olekanma Ekekwe-Kauffman from the
practice of law in the District of Columbia. It makes that recommendation
principally upon a finding that Ekekwe-Kauffman engaged in reckless
2
misappropriation of entrusted client funds with respect to four clients, though it also
found a host of other violations of the District of Columbia Rules of Professional
Conduct. Ekekwe-Kauffman raises several exceptions to the Board’s Report and
Recommendation, but only one is of any consequence: she contends there was not
substantial evidence to support the Board’s finding that she engaged in reckless
misappropriation. Rather, she maintains that the evidence shows any
misappropriations were the result of mere negligent recordkeeping, rather than
recklessness.
We conclude there is substantial evidence to support the Board’s finding that
Ekekwe-Kaufmann recklessly misappropriated client funds and we therefore adopt
that finding. Disbarment is the presumptive sanction for reckless misappropriation.
In re Addams, 579 A.2d 190, 191 (D.C. 1990) (en banc). This case involves no
“extraordinary circumstances” meriting departure from the presumptive sanction,
id., and none of Ekekwe-Kauffman’s other challenges alter the conclusion that
disbarment is warranted here. We therefore adopt the Board’s recommended
sanction and disbar Ekekwe-Kauffman from the practice of law in the District of
Columbia.
3
I.
This is not Ekekwe-Kauffman’s first time through the disciplinary process. In
2008, Disciplinary Counsel opened an investigation into Ekekwe-Kauffman in
response to a former client’s complaint. See In re Ekekwe-Kauffman, 210 A.3d 775,
782-83 (D.C. 2019). In that case, like this one, the Board ultimately recommended
we disbar Ekekwe-Kauffman based on her reckless misappropriation of client funds.
We rejected that recommendation because we concluded the evidence did not
support the conclusion that Ekekwe-Kauffman had in fact misappropriated client
funds; although the evidence showed that she commingled client funds with her own,
the evidence was lacking as to the “more egregious” conduct of misappropriation.
Id. at 792-93 (“When an attorney deposits client funds into the attorney’s operating
account, she engages in commingling. She does not engage in misappropriation,
however, until ‘the balance in that account falls below the amount due to the
client.’”) (citation omitted). While Ekekwe-Kauffman had deposited client funds
into her operating account and thereby commingled funds, it did not appear that the
operating account had ever “dropped below the amount she should have been
holding” on behalf of her client. Id. at 793-94. We nonetheless suspended her from
the practice of law in the District for three years for a host of other violations. Id. at
797-800.
4
This appeal arises from the complaint of another former client, Florence
Myers. In response to that complaint, Disciplinary Counsel opened another
investigation in 2013. The investigation eventually revealed that between May 2014
and June 2015, Ekekwe-Kauffman’s trust accounts in which she held client funds
were overdrawn eight times. Disciplinary Counsel later filed a Specification of
Charges. Some of the charges related to Ekeke-Kauffman’s failure to provide legal
advice to Myers after being paid to do so,1 while others concerned Ekeke-
Kauffman’s handling of client-entrusted funds on behalf of four clients in 2014 and
2015: James Short, LaToya King, Dewaine Drew, and DePaul Eppright. 2 For
purposes of this appeal, we narrow our focus to the second set of charges concerning
misappropriation, because they underpin the Board’s recommendation to disbar
Ekekwe-Kauffman. The core evidence relevant to misappropriation as to each of
the four clients was as follows.
1
More specifically, Disciplinary Counsel alleged Ekekwe-Kauffman violated
Rule 1.4(a) by failing to keep Myers reasonably informed; Rule 1.16(d) by failing
to promptly return Myers’s money upon notice of termination; and Rule 8.4(c) by
engaging in conduct involving dishonesty and misrepresentation.
2
With respect to the misuse of entrusted client funds, Disciplinary Counsel
alleged Ekekwe-Kauffman violated Rule 1.15(a) by failing to keep and preserve
complete records of trust-account funds as well as recklessly misappropriating
funds; Rule 8.1(b) by failing to respond to a lawful demand for information by
Disciplinary Counsel; and Rule 8.4(d) by seriously interfering with the
administration of justice.
5
James Short
In March of 2015, Ekekwe-Kauffman received a settlement check on behalf
of James Short for $8500, which she deposited into a Bank of America trust account.
Of that amount, Ekekwe-Kauffman’s closing statement indicated she was
withholding the following amounts: $2250 for her attorney’s fees, $500 for “Office
Expense/Postage & Copies,” and $2562.86 for amounts owed to third parties
($460.75 to the D.C. Fire and EMS Department; $1350 to “Pain & Rehab Center”;
and $752.11 to Medicare). Ekekwe-Kauffman acknowledged she was not
authorized to use the money earmarked for those third parties for any purpose aside
from paying them the amounts indicated.
Ekekwe-Kauffman’s bank records reflect that she both overpaid herself and
kept much of the money earmarked for third parties. She paid herself $3000 in
attorney’s fees, which was $750 more than the (apparently already overinflated)
closing statement indicated she was due. 3 More specifically, she wrote herself two
3
The closing statement listed Ekekwe-Kauffman’s attorney’s fees as twenty-
five percent of the settlement, which would be $2125, or $125 less than the $2250
miscalculated in the closing statement. In her testimony, Ekekwe-Kauffman
attempted to explain the discrepancy by stating she charged a higher rate because
the case went to trial. That is not much of an explanation, however, where the
closing statement reflected the rate as 25% and simply inflated what that amounted
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checks—with “James Short” and “Short’s case” in the memo lines—totaling $3000
in March and April of 2015, and that was in addition to another check for $500 she
had written herself in mid-March, presumably to cover the closing statement’s line
item for $500 in expenses. As for the $2562.86 earmarked for third parties, the
evidence shows that Ekekwe-Kauffman kept more than $2000 of that for herself.
She never paid the $460.75 due to D.C. Fire and EMS; she never paid the $1350 due
to “Pain and Rehab Center”; and she paid Medicare just $450.12 of the $752.11
indicated on the closing statement, passing $100 of the difference on to Short and
keeping the remaining $201.99 for herself.
All told, the records indicate Ekekwe-Kauffman misappropriated more than
$2750 of Short’s funds, more than doubling the amount she was owed in fees and
expenses. Even if, as Ekekwe-Kauffman insists, Short and all of the third parties
eventually “got paid,” we note the Bank of America trust account in question was
overdrawn by $750 on May 27, 2015, and its balance remained below the
approximately $2750 owed in connection with Short’s case for the entirety of June.
Her account balance was thus below the amount she owed to Short and to third
to. If she was charging a higher rate, that was not apparent from the face of the
closing statement unless one did the math.
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parties on his behalf for an extended period, with no evidence that Ekekwe-
Kauffman had paid them the amounts due in that time.
LaToya King
Ekekwe-Kauffman deposited a $2000 settlement check on behalf of Latoya
King into the Bank of America trust account in May of 2014, when the account was
already overdrawn by $12.35. After disbursing her own fee and some attendant
expenses to herself, and paying King her share of the settlement, Ekekwe-Kauffman
owed $150 to a third-party medical provider on King’s behalf, and sent the provider
a check in that amount. However, the trust account did not have the necessary $150
to cover that expense—it had just $137.65 (i.e., the account was still $12.35 short).
Ekekwe-Kauffman remedied the matter within the week by transferring $50 into the
account. Ekekwe-Kauffman testified that she did not have authorization from King
or from the provider to use, even briefly, any portion of the $150.
Dewaine Drew
Dewaine Drew received $8000 in settlement funds, which Ekekwe-Kauffman
deposited into the Bank of America trust account on May 1, 2015. Drew’s closing
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statement indicated some withheld funds would be used to pay $480.25 to Anacostia
River Emergency Physician PC. While Ekekwe-Kauffman wrote a check for that
exact amount to Credence Resource Management, the collection company that
apparently had taken over the debt, there is no indication this check was actually
mailed or cashed between May and September 2015. During that time, the trust
account’s balance not only fell below the amount owed, it was overdrawn at least
three times. Ekekwe-Kauffman testified that she did not have authority to use any
portion of this money.
DePaul Eppright
DePaul Eppright received $12,500 in settlement funds which Ekekwe-
Kauffman deposited into the Bank of America trust account on May 11, 2015.
Eppright’s closing statement reflected that $1100 of those settlement funds were to
be paid to Doctors “Grover, Christie & Merritt.” Between the time when Ekekwe-
Kauffman deposited the settlement funds and eventually paid those medical
providers, the trust account was overdrawn and fell below the amount owed
numerous times. Ekekwe-Kauffman testified that neither the providers nor Eppright
gave her permission to use any portion of their money.
9
* * *
After conducting a hearing on the matter, the Hearing Committee found,
among other violations, the four above instances of reckless misappropriation and
consequently recommended Ekekwe-Kauffman be disbarred. The Board on
Professional Responsibility unanimously agreed with that recommendation, though
one Board member was recused and did not participate. Ekekwe-Kauffman now
takes exception to that recommendation and to a variety of findings of fact and
conclusions of law.
II.
“[W]e must accept the Board’s evidentiary findings if they are supported by
substantial evidence in the record.” In re Howes, 52 A.3d 1, 12 (D.C. 2012) (citing
Cleaver-Bascombe I, 892 A.2d 396, 401-02 (D.C. 2006)). However, we review the
Board’s conclusions of law de novo. In re Saint-Louis, 147 A.3d 1135, 1147 (D.C.
2016) (citation omitted); see also D.C. Bar R. XI, § 9(h)(1). We will “adopt the
recommended disposition of the Board unless to do so would foster a tendency
toward inconsistent dispositions for comparable conduct or would otherwise be
10
unwarranted.” In re Saint-Louis, 147 A.3d at 1147 (citing In re Rodriguez-Quesada,
122 A.3d 913, 921 (D.C. 2015)).
Ekekwe-Kauffman raises a number of challenges to the Board’s findings of
fact and conclusions of law, but only one of them requires detailed consideration:
she contends that substantial evidence does not support the Board’s conclusions that
she recklessly misappropriated entrusted funds. To the extent she misappropriated
client funds at all, she maintains that the evidence shows her lapses were the result
of mere “negligent record-keeping.” We limit our consideration to these
misappropriation offenses because both the Hearing Committee and the Board
recommended disbarment based on the misappropriations alone. Disbarment is also
the presumptive sanction for even one instance of reckless or intentional
misappropriation, absent extraordinary circumstances that are not presented here. In
re Addams, 579 A.2d at 191. Because disbarment is the harshest discipline we can
impose, it is “unnecessary for us to determine” whether substantial evidence
supports the other violations found by the Board, and it is likewise “unnecessary for
us to determine the appropriate sanctions for” those other violations, assuming the
evidence supports them. In re Pleshaw, 2 A.3d 169, 175 n.26 (D.C. 2010).
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A.
Ekekwe-Kauffman argues the evidence did not support a finding that she
recklessly misappropriated entrusted funds in the King, Short, Drew, and Eppright
matters. This argument raises two separate questions. First is whether substantial
evidence supports the Board’s finding that Ekekwe-Kauffman misappropriated
funds. If she did, then the second question is whether her misappropriations were
the result of mere negligence, or instead were reckless or intentional. See In re Saint-
Louis, 147 A.3d at 1147. We consider those questions in turn.
1.
Misappropriation is “any unauthorized use of client[] funds entrusted to the
lawyer.” In re Anderson, 778 A.2d 330, 335 (D.C. 2001) (quoting In re Harrison,
461 A.2d 1034, 1036 (D.C. 1983)). It includes “not only stealing but also
unauthorized temporary use for the lawyer’s own purpose, whether or not [she]
derives any personal gain or benefit therefrom.” Id. An attorney commits
misappropriation when the balance of the attorney’s account holding client funds
drops below the amount the attorney owes to the client and/or owes to third parties
on the client’s behalf. In re Edwards, 990 A.2d 501, 518 (D.C. 2010). “There is no
12
‘scienter’ requirement in this court’s approach to misappropriation,” which “is
essentially a per se offense” regardless of the mental state with which it is committed.
In re Saint Louis, 147 A.3d at 1149 (quoting In re Berryman, 764 A.2d 760, 768
(D.C. 2000)).
Substantial evidence supports the Board’s finding that there was
misappropriation in all four instances. First, Ekekwe-Kauffman testified that none
of the four clients authorized her to use their money, or to use money set aside to
pay third parties on their behalf, for any purpose aside from paying the amounts due.
Yet, in all four cases the record establishes that, at least temporarily, Ekekwe-
Kauffman used entrusted funds by letting her trust account dip below the amounts
owed to clients and to third parties on their behalf. Her misappropriations were not
always of substantial sums, and were not always for protracted periods, but in each
case the evidence shows that some misappropriation occurred.
To illustrate, we recap the relevant facts of Short’s case, which presents the
most egregious of the misappropriations. In Short’s case, the evidence demonstrated
that Ekekwe-Kauffman never paid some third-party providers at all, pocketed
reductions in fees that should have been passed along to Short, and took more than
her share of attorney’s fees and expenses. Whether or not she permanently stole
13
those amounts, her bank records show that she at least temporarily misappropriated
over $2750, and her trust account dipped well below that amount for a stretch of
time when she still owed it to Short and to third parties on his behalf. In fact, the
account balance was repeatedly in the negative during the relevant period between
May and June of 2015.
Ekekwe-Kauffman’s arguments to the contrary do not actually grapple with
the evidence of misappropriation. She stresses that (1) Disciplinary Counsel did not
prove she derived any benefit from any purported misappropriations, (2) all of the
clients “got paid” eventually, and (3) none of these four clients ever filed a complaint
against her. Even if each of those things were true—and the second appears to be
false at least with regard to Short’s funds—none of them alters the conclusion that
Ekekwe-Kauffman misappropriated funds. Misappropriation does not depend on a
showing that the attorney derived any benefit from the co-opted funds. See In re
Anderson, 778 A.2d at 335. Nor does it depend upon a deprivation that is permanent
in character or of any particular duration. Even brief misappropriations are
misappropriations. Id. It also does not matter, nor is it particularly surprising, that
none of these clients filed complaints against Ekekwe-Kauffman. In the King, Drew,
and Eppright cases, the misappropriation consisted of amounts owed to third parties,
14
as did some of the misappropriation in Short’s case. Whether the clients complained
or even noticed the misappropriations is immaterial to the fact that they occurred.
2.
Next, Ekekwe-Kauffman takes aim at the Board’s finding that she acted
recklessly, as opposed to merely negligently, in committing these misappropriations.
“[M]isappropriation revealing an unacceptable disregard for the safety and welfare
of entrusted funds” constitutes reckless misappropriation. Id. at 338; see also In re
Saint-Louis, 147 A.3d 1147; In re Ahaghotu, 75 A.3d 251, 256 (D.C. 2013). As In
re Ahaghotu explained, some of the “hallmarks” of reckless misappropriation are:
‘the indiscriminate commingling of entrusted and personal
funds’; a ‘complete failure to track settlement proceeds’;
the ‘total disregard of the status of accounts into which
entrusted funds were placed, resulting in a repeated
overdraft condition’; ‘the indiscriminate movement of
monies between accounts’; and finally ‘the disregard of
inquiries concerning the status of funds.’
75 A.3d at 256 (quoting In re Anderson, 778 A.2d at 338). Even one instance of
misappropriation lasting only a brief period can constitute reckless misappropriation
if the attorney misappropriated with “casual indifference in maintaining the security”
of the entrusted funds. Id. at 255-58 (finding reckless misappropriation where
15
evidence showed “just one instance of misappropriation—lasting only a day at
that”).
Ekekwe-Kauffman’s handling of entrusted funds evinces practically all of the
hallmarks of reckless misappropriation. She commingled funds between her trust
and operating accounts repeatedly and indiscriminately. She likewise moved money
among her personal, business, and trust accounts, haphazardly covering shortfalls in
each account by drawing on the balance of the others. For example, in May 2015
(when some of the relevant misappropriations occurred), Ekekwe-Kauffman
transferred $10,000 from her trust account to her operating account and then used
the funds in her operating account to make an $18,480.41 payment to a third party
on behalf of Serah’s Outdoor Adventures & Recreation, a non-legal business she
owned. This $10,000 transfer caused her trust fund account balance to drop to
around $3300 on May 22. Then when two checks to Eppright’s service providers
were cashed on May 27, the account became overdrawn by about $750, which
Ekekwe-Kauffman remedied with a $900 deposit a couple of days later. Because
she “injected personal funds to make up for a low trust account balance, instead of
sitting down . . . to figure out what went wrong, it was likely something would go
wrong again.” In re Ahaghotu, 75 A.3d at 257. “[This] commingling of funds only
16
papered over the problem and, unfortunately, showed a continued lack of interest in
tracking what client funds were available at any given moment.” Id.Furthermore, the eight overdrafts in Ekekwe-Kauffman’s trust accounts over
the course of roughly a year show a “pattern or course of conduct demonstrating an
unacceptable disregard for the welfare of entrusted funds.” In re Cloud, 939 A.2d
653, 660 (D.C. 2007). In June of 2014, Disciplinary Counsel sent Ekekwe-
Kauffman an inquiry letter concerning a May 2014 notice that her SunTrust trust
account was overdrawn by more than $3000 and attached a copy of the relevant D.C.
Bar Rule requiring her to maintain complete records of entrusted funds. This was
right after her trust account was overdrawn leading to the misappropriation in King’s
case, so one might have expected her to take the warning to heart and remedy her
behavior. However, the Short, Drew, and Eppright misappropriations took place
nearly a year later, showing Ekekwe-Kauffman did not meaningfully change her
accounting practices to prevent future misappropriations. 4 Like the attorney in In re
Ahaghotu, Ekekwe-Kauffman “was clearly on notice of problems with [her]
accounting practices and [her] escrow account” and yet did not take sufficient action
4
While it is not material to our disposition here, Disciplinary Counsel stresses
that Ekekwe-Kauffman’s financial records were so incomplete and scattered that the
handful of misappropriations it was able to prove by piecing together what few
financial records she provided may only scratch the surface of her misappropriations.
17
to prevent further endangerment of entrusted funds. 75 A.3d at 255. In her
testimony, Ekekwe-Kauffman seemed to suggest that her bank statements
constituted adequate financial records to track client funds. But Disciplinary
Counsel’s letter should have disabused her of that belief, long before the Short,
Drew, and Eppright misappropriations.
Ekekwe-Kauffman stresses that her “negligent record-keeping” should not
warrant a sanction, citing In re Cloud, 939 A.2d 653 (D.C. 2007). We do not think
that case is of any help to her. In In re Cloud, the Board credited an attorney’s
testimony that he honestly misinterpreted a letter from a third party to indicate that
he owed them less than he in fact did. Id. at 661. He then drew down an account
holding client settlement funds to a point below what was actually owed to the third
party, but only because of his honest belief that he owed less. Id. Prior to receiving
that letter and misinterpreting it, the attorney had kept adequate funds in his accounts
to cover the debt. Id. We adopted the Board’s recommendation that this did not
amount to reckless misappropriation because the attorney “did not display the
conscious indifference necessary for a finding of recklessness.” Id. However, we
also agreed with the Board that the attorney committed reckless misappropriation
when he later discovered his mistake and yet failed to pay the money back for four
years. Id. at 661-62.
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Unlike In re Cloud, Ekekwe-Kauffman did not make a one-time mistake
leading to a misappropriation that we could chalk up to neglect. She had a practice
of commingling funds and repeatedly overdrew accounts holding client funds well
below the amounts owed. She insists that everybody eventually “got paid” as if that
excuses her misappropriations. It does not. All it does is further underscore that
Ekekwe-Kaufmann remains seemingly indifferent to misappropriating funds so long
as everybody is eventually paid. Ekekwe-Kauffman’s “conscious failure to act” in
response to the numerous warning signs—the overdrafts from trust accounts, the
letters from Disciplinary Counsel, etc.—and “protect [her] clients from future
misappropriation” shows these misappropriations crossed the line from negligent to
at least reckless due to her “conscious indifference” to the possibility of future
problems. In re Ahaghotu 75 A.3d at 258. A defense of “faulty recording-keeping”
will not absolve an attorney who knows her recordkeeping is faulty but does not fix
the problem. See In re Smith, 817 A.2d 196, 202-03 (D.C. 2003) (rejecting Hearing
Committee’s finding of negligent misappropriation, and adopting the Board’s
finding of reckless misappropriation, where attorney’s repeated misappropriations
were “so persistent . . . that his misappropriation was reckless, not merely
negligent”).
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B.
We now turn our focus to the appropriate sanction. “[I]n virtually all cases of
misappropriation, disbarment will be the only appropriate sanction unless it appears
that the misconduct resulted from nothing more than simple negligence.” In re
Addams, 579 A.2d at 191; In re Myers, 114 A.3d 1274, 1279 (D.C. 2015). Only if
there are “extraordinary circumstances” will a sanction less than disbarment be
appropriate in contested cases of reckless or intentional misappropriation. In re
Hewett, 11 A.3d 279, 287-90 (D.C. 2011) (highlighting “truly unique”
circumstances); see also In re Mensah, 262 A.3d 1100 (D.C. 2021) (negotiated-
discipline process “permit[s] a somewhat more flexible approach” than what applies
to contested cases). There are no “extraordinary circumstances” here that would
warrant our departure from the presumptive discipline of disbarment. There is no
evidence, for instance, that Ekekwe-Kauffman suffered from a disabling condition
that prompted her misconduct. See In re Kersey, 520 A.3d 321, 325-27 (D.C. 1987)
(disabling condition of chronic alcoholism contributed to the misconduct). Nor is
this a circumstance, as in In re Hewett, where the misappropriation was committed
“for the purpose of benefitting the client, and in fact did benefit the client.” 11 A.3d
at 282, 286 (prematurely withdrawing attorney’s fees from client’s account to ensure
client did not lose Medicaid eligibility due to an excess of funds in the account).
20
Ekekwe-Kauffman, aside from arguing that her misappropriations were
negligent rather than reckless, does not suggest that any extraordinary circumstances
apply here as to merit a departure from the presumptive discipline of disbarment.
We see none. Even the “usual sort” of mitigating factors, which tend not to be
grounds to depart from a sanction of disbarment unless they are “especially strong,”
are generally lacking here. In re Addams, 579 A.2d at 191. The usual sort of
mitigating factors include “(1) an admission of wrongdoing, (2) full cooperation with
the disciplinary authorities, (3) prompt return of the disputed funds, and, most
importantly, (4) an unblemished record of professional conduct.” In re Edwards,
990 A.2d at 527 (quoting In re Pierson, 690 A.2d 941, 950 (D.C. 1997)). As to
those, Ekekwe-Kauffman does not admit to wrongdoing beyond acknowledging that
she should “better maintain records.” She did not fully cooperate with the
disciplinary authorities, as Disciplinary Counsel points out, but generally obstructed
the investigation and “produced only minimal financial records, in no discernable
order.” Some of the misappropriated funds are still unaccounted for and there is no
indication they have every been remitted to the rightful party. And Ekekwe-
Kauffman does not have an unblemished disciplinary record, but instead is already
in the midst of serving a three-year suspension.
IV.
21
Accordingly, it is ORDERED that Ekekwe-Kauffman is hereby disbarred
from the practice of law in the District of Columbia. Inasmuch as Ekekwe-
Kauffman’s right to practice law in the District has been and remains suspended in
another matter, this order of disbarment is effective immediately. For purposes of
reinstatement, however, the period of Ekekwe-Kauffman’s disbarment shall not
begin to run until such time as she files an affidavit in compliance with D.C. Bar R.
XI, § 14(g). See D.C. Bar R. XI, § 16(c).
So ordered.