Disciplinary Counsel v. Fitz ( 2022 )

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as
Disciplinary Counsel v. Fitz, Slip Opinion No. 2022-Ohio-3108.]
NOTICE
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SLIP OPINION NO. 2022-OHIO-3108DISCIPLINARY COUNSEL v. FITZ.
[Until this opinion appears in the Ohio Official Reports advance sheets, it
may be cited as Disciplinary Counsel v. Fitz, Slip Opinion No.
2022-Ohio-3108.]
Attorneys—Misconduct—Attorney violated the Rules of Professional Conduct,
including Prof.Cond.R. 8.4(b) (prohibiting an attorney from committing an
illegal act that reflects adversely on the attorney’s honesty or
trustworthiness) and 8.4(c) (prohibiting an attorney from engaging in
conduct involving dishonesty, fraud, deceit, or misrepresentation)—Two-
year suspension imposed, with no credit for time served under interim
felony suspension—Reinstatement conditioned on attorney’s providing
proof of his substantial, continuing efforts to pay restitution ordered as part
of his criminal sentence.
(No. 2022-0363—Submitted May 24, 2022—Decided September 8, 2022.)
ON CERTIFIED REPORT by the Board of Professional Conduct of the Supreme
Court, No. 2020-046.
SUPREME COURT OF OHIO
__________________
Per Curiam.
{¶ 1} Respondent, Robert Edward Fitz, of Westlake, Ohio, Attorney
Registration No. 0024277, was admitted to the practice of law in Ohio in 1972. On
December 20, 2019, we suspended Fitz’s license on an interim basis after receiving
notice that he had been convicted of workers’ compensation fraud in violation of
R.C. 2913.48(A)(7), a fourth-degree felony. See In re Fitz, 158 Ohio St.3d 1260,
2019-Ohio-5265, 145 N.E.3d 331.
{¶ 2} In August 2020, relator, disciplinary counsel, charged Fitz with
violating the Rules of Professional Conduct based on the facts that led to his felony
conviction. The disciplinary matter was stayed until the completion of Fitz’s
criminal appeal, which was resolved in late 2021. In February 2022, the parties
entered into a comprehensive set of stipulations in which Fitz admitted to the
charged misconduct. The parties, however, could not agree on a recommended
sanction.
{¶ 3} After a hearing before a three-member panel of the Board of
Professional Conduct, the board issued a report finding that Fitz had engaged in the
stipulated misconduct and recommending that we suspend his license for two years,
with no credit for the time he has served under his interim felony suspension. The
board also recommends that we condition Fitz’s future reinstatement on his
submission of proof that he has made substantial and continuing efforts to pay the
restitution ordered in his criminal sentence. Neither party has objected to the
board’s report. Based on our review of the record, we adopt the board’s findings
of misconduct and recommended sanction.
Misconduct
{¶ 4} Since 1991, Fitz has applied for and obtained workers’ compensation
policies from the Ohio Bureau of Workers’ Compensation (hereinafter, “the
bureau”) for 12 housecleaning businesses, many of which operated under similar
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January Term, 2022
names. This matter involves his failure to pay premiums for workers’
compensation coverage—and his related felony conviction—despite several
opportunities for him to bring his policies into compliance.
Fitz’s prior contacts with bureau investigators
{¶ 5} In 1996, Fitz obtained a workers’ compensation policy for RCF
Licensing, Inc., but stopped paying the policy’s premium in September 2003.
Around December 2006, agents from the bureau’s special-investigations division
advised Fitz that it was illegal to operate a business without appropriate workers’
compensation coverage. In response, Fitz said that the policy had lapsed and that
he was trying to reinstate it.
{¶ 6} Around September 2013, the bureau consolidated all of Fitz’s
workers’ compensation policies into one, policy No. 1185201-0. The bureau also
discovered that Fitz’s various policies either had lapsed or had been canceled. After
an investigation, the bureau provided Fitz with the balance due for policy No.
1185201-0 and with payment-plan options. Fitz, however, did not bring his policy
into compliance.
{¶ 7} In March 2017, Fitz was charged in the Franklin County Court of
Common Pleas with workers’ compensation fraud, forgery, and failure to comply.
Fitz entered a no-contest plea to the failure-to-comply charge, a second-degree
misdemeanor, and the court entered a nolle prosequi as to the remaining counts.
The court imposed a 30-day suspended jail sentence and ordered Fitz to pay $2,000
in restitution and the court costs.
Fitz’s felony conviction
{¶ 8} In November 2018, the bureau investigated Fitz again—this time
based on his failure to maintain workers’ compensation coverage for AM Team,
Inc., another one of Fitz’s housecleaning businesses.
{¶ 9} In June 2019, Fitz was charged in the Cuyahoga County Court of
Common Pleas with three counts of workers’ compensation fraud under R.C.
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2913.48(A)(7), a fourth-degree felony. Each count alleged that Fitz had committed
the offense during separate payroll periods between 2017 and 2019. In September
2019, Fitz entered a guilty plea to Count 1, which alleged that he had failed to
secure or maintain workers’ compensation coverage from March 17 to June 30,
2017. The state dismissed the other two counts.
{¶ 10} Fitz stipulated in this disciplinary case that the following facts from
the bureau’s investigation supported his guilty plea. Fitz was the president and sole
operator of AM Team, Inc. In December 2018, bureau agents provided him with
his workers’ compensation policy balance, two payroll “true-up reports,” and
instructions for a reinstatement payment plan.1 Fitz returned the true-up reports but
failed to pay any money toward reinstating his policy, although he had employees
who made workers’ compensation claims in 2017 and 2018. The bureau calculated
that Fitz owed a balance of $936,344 on policy No. 1185201-0.
{¶ 11} The court sentenced Fitz to five years of community control and
ordered him to pay $965,235 in restitution through a payment plan established by
the court’s probation department. Fitz appealed the restitution amount, but the
court of appeals affirmed the trial court’s judgment. Between December 2019 and
February 2022 when the parties entered into their stipulations, Fitz paid $250 each
month toward the restitution order.2 As of February 2022, he still owed $958,485.
{¶ 12} Based on this conduct, the parties stipulated and the board found that
Fitz violated Prof.Cond.R. 8.4(b) (prohibiting a lawyer from committing an illegal
act that reflects adversely on the lawyer’s honesty or trustworthiness) and 8.4(c)
1. According to the parties’ stipulations, because an employer’s workers’ compensation premium
is based on the amount of payroll, the bureau requires employers to file true-up reports at the end of
each policy year. The reports contain the employer’s actual payroll for the previous year. This
information assists the bureau in determining whether the previous year’s premiums were correct
and in estimating an appropriate premium for the following year.
2. The parties stipulated that in October 2015, Fitz also paid $650 toward his policy balance.
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January Term, 2022
(prohibiting a lawyer from engaging in conduct involving dishonesty, fraud, deceit,
or misrepresentation). We agree with the board’s findings of misconduct.
Sanction
{¶ 13} When imposing sanctions for attorney misconduct, we consider all
relevant factors, including the ethical duties that the attorney violated, the
aggravating and mitigating factors listed in Gov.Bar R. V(13), and the sanctions
imposed in similar cases.
{¶ 14} As aggravating factors, the board found that Fitz had a dishonest or
selfish motive and that he had engaged in a pattern of misconduct. See Gov.Bar R.
V(13)(B)(2) and (3). As for mitigation, the board found that Fitz has a clean
disciplinary record, has made an effort toward paying restitution, made full and free
disclosures to the board and had a cooperative attitude toward the disciplinary
proceedings, and had other sanctions imposed for his misconduct. See Gov.Bar R.
V(13)(C)(1), (3), (4), and (6).
{¶ 15} In fashioning a recommended sanction, the board reviewed cases
involving attorneys who had failed to remit payroll taxes on behalf of their
employees and cases involving attorneys who had violated both Prof.Cond.R.
8.4(b) and 8.4(c). Relator argued that Fitz should be indefinitely suspended but
given credit for the time he has served under his December 2019 interim
suspension. In support, relator cited several cases, including Disciplinary Counsel
v. Bereday, 157 Ohio St.3d 8, 2019-Ohio-1895, 131 N.E.3d 9; Disciplinary Counsel
v. Marshall, 155 Ohio St.3d 208, 2018-Ohio-4174, 120 N.E.3d 772; and
Disciplinary Counsel v. Smith, 128 Ohio St.3d 390, 2011-Ohio-957, 944 N.E.2d
1166.
{¶ 16} In Bereday, the attorney, while serving as the general counsel and
chief compliance officer for one of Florida’s largest providers of managed-care
services, caused one of the provider’s subsidiaries to submit a false worksheet to
the Florida agency administering the state’s Medicaid program. As a result of the
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SUPREME COURT OF OHIO
false financial information, the Medicaid program incurred a loss of $4,489,303.
Bereday was convicted in federal court of knowingly making a false statement
involving a healthcare-benefit program. We indefinitely suspended him but
granted him credit for the time he had served under his interim felony suspension.
Id. at ¶ 4, 7, 18.
{¶ 17} In Marshall, the attorney participated in an 11-year scheme in which
a group of related businesses submitted false information to federal agencies to
obtain funding that the businesses were not qualified to receive. The conspiracy
arguably diverted more than $140 million in federal contracts away from other
businesses that could have qualified for the money. Marshall was convicted in
federal court of attempt and conspiracy to commit wire fraud. We imposed an
indefinite suspension, with no credit for the time he had served under his interim
felony suspension. Id. at ¶ 5-14, 23-24.
{¶ 18} In Smith, 128 Ohio St.3d 390, 2011-Ohio-957, 944 N.E.2d 1166, the
attorney failed to report $1,411,265 in income over several years and allowed his
agent to falsely state in an audit that he had no source of income other than that
reported on his tax return. Smith was convicted of conspiracy to defraud the
Internal Revenue Service (“IRS”), making false tax returns, and corruptly
endeavoring to obstruct and impede an IRS investigation. We indefinitely
suspended him but granted him credit for the time he had served under his interim
suspension. Id. at ¶ 6-10, 16.
{¶ 19} The board found these cases instructive but also distinguishable from
the facts in this case. For example, the board concluded that Bereday’s
misconduct—scheming to defraud almost $4.5 million from the Florida Medicaid
program—was more serious than Fitz’s and that Bereday included an additional
aggravating factor. The board similarly emphasized that Marshall diverted $140
million in federal contracts away from other businesses and that Smith failed to
report over $1.4 million in income and was convicted of multiple federal felonies.
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January Term, 2022
{¶ 20} In contrast to relator, Fitz argued that he should be suspended for
two years, with credit for the time he has served under his interim suspension. He
cited several cases imposing that sanction, including Disciplinary Counsel v.
Atway, 160 Ohio St.3d 86, 2020-Ohio-2794, 153 N.E.3d 79; Disciplinary Counsel
v. Lawrence, 147 Ohio St.3d 315, 2016-Ohio-4605, 65 N.E.3d 711; and
Disciplinary Counsel v. Jacobs, 140 Ohio St.3d 2, 2014-Ohio-2137, 14 N.E.3d 984.
{¶ 21} Atway involved an attorney who failed to accurately report income
for three tax years for a business that he owned, made false statements to his tax
preparer, and failed to file a return for one year. His misconduct resulted in a loss
of between $250,000 and $1,500,000 in federal income-tax revenue. He was
convicted of filing a false federal tax return and ordered to pay $600,000 in
restitution. Id. at ¶ 4-7. Lawrence involved an attorney who underreported income
from various businesses—some of which were tangentially related to his practice
of law—for three tax years. He was convicted of three counts of filing a false tax
return and ordered to pay $128,253 in restitution. Id. at ¶ 2-9. Jacobs involved an
attorney who understated his income and overstated his expenses for four tax years,
resulting in unpaid taxes of $75,385. He was convicted of one count of making and
subscribing false tax returns. Id. at ¶ 7-13.
{¶ 22} In comparing the facts in those cases to the circumstances here, the
board noted that both Atway and Lawrence were sentenced to federal prison;
indeed, Lawrence was sentenced to 27 months of incarceration for multiple federal
offenses. In contrast, Fitz was sentenced to five years of community control for
one fourth-degree felony. But Atway’s and Lawrence’s restitution orders, the board
noted, involved amounts less than Fitz’s. The board concluded that Jacobs’s
misconduct was “more in line with” Fitz’s, at least compared to the indefinite-
suspension cases cited by relator. But Jacobs’s misconduct occurred over a much
shorter period than Fitz’s, and Jacobs had unpaid taxes of only $75,385.
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{¶ 23} In the end, the board recommended a sanction that fell between the
two sanctions proposed by the parties. The board concluded that considering the
amount of loss suffered by the bureau, the relatively small amount that Fitz has
since repaid, and the fact that Fitz engaged in the misconduct for almost 13 years,
he should be suspended for two years, with no credit for the time he has served
under his December 2019 interim suspension. The board also recommended that
as a condition of reinstatement, Fitz be required to provide proof of substantial,
continuing efforts to pay the restitution ordered as part of his criminal sentence.
{¶ 24} Having considered Fitz’s misconduct, the relevant aggravating and
mitigating factors, and our applicable precedent, we agree with the board’s
recommended sanction.
Conclusion
{¶ 25} Robert Edward Fitz is hereby suspended from the practice of law in
the state of Ohio for two years, with no credit for the time he has served under his
interim felony suspension imposed on December 20, 2019. In addition to meeting
the requirements of Gov.Bar R. V(24), Fitz’s reinstatement shall be conditioned on
his providing proof of his substantial, continuing efforts to pay the restitution
ordered as part of his criminal sentence. Costs are taxed to Fitz.
Judgment accordingly.
O’CONNOR, C.J., and KENNEDY, FISCHER, DEWINE, DONNELLY, STEWART,
and BRUNNER, JJ., concur.
_________________
Joseph M. Caligiuri, Disciplinary Counsel, and Kelli C. Schmidt, Assistant
Disciplinary Counsel, for relator.
Robert Edward Fitz, pro se.
_________________
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