The Florida Bar v. Karl O. Koepke

Supreme Court of Florida
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No. SC20-286
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THE FLORIDA BAR,
Complainant,
vs.
KARL O. KOEPKE,
Respondent.
October 28, 2021
COURIEL, J.
We have for review a referee’s report recommending that
Respondent, Karl O. Koepke, be found guilty of professional
misconduct and suspended from the practice of law for one year.
We have jurisdiction. See art. V, § 15, Fla. Const.
Notwithstanding Mr. Koepke’s long membership in the Florida
Bar and lack of prior disciplinary history, we conclude that his
actions in this matter demonstrate so purposeful and considered a
violation of his oath of attorney as to require disbarment. We
therefore disapprove of the referee’s recommended sanction and
order instead that Mr. Koepke be disbarred.
I
Mr. Koepke was admitted to the Florida Bar in 1965. His
practice has focused on civil trial law, primarily representing clients
in wrongful death actions.
Mr. Koepke divorced in 1990. His former wife received an
alimony award. In 2014, Mr. Koepke fell substantially behind in
alimony payments, and his former wife filed a motion for contempt,
seeking $88,000 in arrearages. Mr. Koepke was represented in the
proceeding, but he also appeared as co-counsel.
While his divorce litigation was pending, Mr. Koepke
represented a plaintiff in a personal injury matter. On September
9, 2016, Mr. Koepke signed a settlement agreement at mediation to
resolve that case for his client, subject to court approval. He had a
contingency fee agreement that entitled him to approximately
$400,000 of the settlement proceeds.
Shortly thereafter, Mr. Koepke’s former wife’s attorney,
Gregory Wilson, discovered that the personal injury case Mr.
Koepke was handling might have settled. In the proceedings
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regarding Mr. Koepke’s delinquent alimony, Wilson requested
documents regarding any such settlement. Mr. Koepke refused to
produce them, so Wilson filed a motion to compel. On June 29,
2017, the court granted that motion and required Mr. Koepke to
produce “(1) a redacted copy of his retainer agreement setting forth
his fee agreement/compensation arrangement, (2) all settlement
correspondence and written communications with the defendants,
all documents, that are not atty-client privileged, related to any
settlement payments by the insurance company, and (3) any
settlement agreements.” Report of Referee at 4.
On July 10, 2017, Mr. Koepke complied, providing a redacted
copy of the fee agreement in the personal injury case. But,
critically, Mr. Koepke did not produce any documents related to the
September 9, 2016, settlement agreement. Ten days later, Mr.
Koepke filed another document with the court, stating, “(1) a
redacted copy of the contract was previously provided on July 10,
2017; as to category (2) there being no settlement, no documents
exist or could be found that are responsive; and, as to category (3)
there being no settlement, no documents exist or could be found
that are responsive.” Id.
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The court held a trial on the former wife’s motion for contempt
and Mr. Koepke’s petition for mediation on August 24 and 25, 2017.
Before trial, the former wife’s counsel served subpoenas duces
tecum on several parties to the personal injury matter and on Mr.
Koepke, requesting that he bring his client file to court on the day
of the trial. A party in the personal injury case moved to quash the
subpoenas and Mr. Koepke joined the motion. The court ordered
Mr. Koepke to produce the non-privileged contents of his file. On
the second day of trial, Mr. Koepke testified. During cross
examination, Mr. Koepke revealed that he had in fact not brought
the client file with him to court, notwithstanding the court’s order
compelling him to do so. The court renewed its order and took a
one-hour recess allowing Mr. Koepke to retrieve the file. Mr.
Koepke did, and the trial court reviewed it in camera. Not
surprisingly, the court found the September 9, 2016, settlement
agreement and ordered its production to the former wife. Because
the newly discovered evidence justified a continuance beyond the
time allotted for trial, and because the judge was slated soon to
rotate out of the division, the court declared a mistrial. On
September 27, 2017, the former wife’s counsel filed a motion for an
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order to show cause why Mr. Koepke should not be held in
contempt.
Undeterred, Mr. Koepke made a series of still more
consequential decisions. As the trial court would later find, on
December 8, 2017, Mr. Koepke settled a trust for the benefit of
himself and his grandchildren. From the $1,000,000 settlement
proceeds due to his client in the personal injury case, $400,000 was
wired to the trust set up by Mr. Koepke. The following week, on
December 14, 2017, through counsel, Mr. Koepke offered his former
wife a payment of $100,000 in exchange for her dismissal of all
pending motions, including the motion for contempt, in their
alimony proceedings and waiver of all past, present, and future
claims to alimony or attorneys’ fees. She rejected his offer.
The matter proceeded to trial again, and, on June 28, 2018,
the successor judge found Mr. Koepke guilty beyond a reasonable
doubt of indirect criminal contempt and sentenced him to 30 days
in jail. In the order finding Mr. Koepke guilty, the trial court found
that he was untruthful and intentionally misleading in his discovery
responses to the former wife to delay and obfuscate the former
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wife’s discovery of the settlement agreement in the personal injury
case.
The order also laid out findings from which the trial court
inferred Mr. Koepke’s intent, including: he was not paying alimony
in the years that the alimony issues were pending before the court;
the delays in alimony payment favored him; his explanation for not
disclosing the settlement agreement was not credible when the
discovery requests, the trial court’s order, and the subpoenas for
trial were very clear, and the title of the document was “Settlement
Agreement at Mediation”; and during the delay in disclosing the
personal injury case settlement, Mr. Koepke “researched, planned,
and executed a diversion of the attorneys’ fees to an irrevocable
trust” that protected these earnings from the former wife. Report of
Referee at 8. The court referred Mr. Koepke to the Bar for
disciplinary review.
On appeal of the order finding Mr. Koepke in contempt, the
Fifth District Court of Appeal per curiam affirmed. Koepke v.
Koepke, 275 So. 3d 1278 (Fla. 5th DCA 2019). Mr. Koepke
ultimately served twenty days in jail for criminal contempt.
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On February 25, 2020, acting on the trial court’s referral, the
Bar filed a complaint alleging that Mr. Koepke violated Bar Rules 3-
4.3 (Misconduct and Minor Misconduct), 4-3.4 (Fairness to
Opposing Party and Counsel), 4-8.4(b) (“A lawyer shall not commit a
criminal act that reflects adversely on the lawyer’s honesty,
trustworthiness, or fitness as a lawyer in other respects.”), 4-8.4(c)
(“A lawyer shall not engage in conduct involving dishonesty, fraud,
deceit, or misrepresentation . . . .”), 4-8.4(d) (“A lawyer shall not
engage in conduct in connection with the practice of law that is
prejudicial to the administration of justice . . . .”), and the Oath of
Admission. The complaint was referred to a referee, who conducted
a hearing on the matter and filed her report on August 24, 2020.
The referee recommended that Mr. Koepke be found guilty of
violating all the Bar Rules alleged in the complaint, as well as the
Oath of Admission. The referee determined that Mr. Koepke’s
failure to disclose the settlement agreement was deceitful. However,
the referee found that Mr. Koepke’s failure to bring the client file
pursuant to the subpoena duces tecum was not established as
deceitful by clear and convincing evidence because Mr. Koepke had
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filed a notice of joinder in the motion to quash the subpoenas duces
tecum.
The referee recommended that Mr. Koepke be disciplined by a
one-year suspension and be ordered to pay the Bar’s costs of
$2,606.73. In making her recommendation as to the appropriate
sanction, the referee found three aggravating factors: (1) dishonest
or selfish motive; (2) refusal to acknowledge the wrongful nature of
the conduct; and (3) substantial experience in the practice of law.
The referee found the following four mitigating factors: (1) absence
of a prior disciplinary record; (2) full and free disclosure to the Bar
or cooperative attitude toward the proceedings; (3) character or
reputation; and (4) imposition of other penalties or sanctions. The
referee considered the following sections of the Florida Standards
for Imposing Lawyer Sanctions: 5.1 (Failure to Maintain Personal
Integrity); 6.1 (False Statements, Fraud, and Misrepresentation); 6.2
(Abuse of the Legal Process); and 7.1 (Deceptive Conduct or
Statements and Unreasonable or Improper Fees).
On October 20, 2020, the Bar filed a notice of intent to seek
review of the referee’s report, particularly the recommended
discipline, and requested that we disbar Mr. Koepke. After receiving
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an extension of time, Mr. Koepke filed his initial answer brief four
days late; the brief was at first accepted then stricken for
noncompliance. He was directed to file an amended answer brief on
or before January 14, 2021, but he did not file it until sixty-one
days later, after the case had already been set for conference.
II
The parties do not dispute the referee’s factual findings or
recommendations as to guilt. Therefore, we focus on the referee’s
recommended sanction for Mr. Koepke.
In reviewing a referee’s recommended discipline, our scope of
review is broader than that afforded to the referee’s findings of fact
because, ultimately, it is our responsibility to order the appropriate
sanction. See Fla. Bar v. Picon, 205 So. 3d 759, 765 (Fla. 2016)
(citing Fla. Bar v. Anderson, 538 So. 2d 852, 854 (Fla. 1989)). At
the same time, we will generally not second-guess the referee’s
recommended discipline so long as it has a reasonable basis in
existing case law and the Florida Standards for Imposing Lawyer
Sanctions (Standards). See Fla. Bar v. Alters, 260 So. 3d 72, 83
(Fla. 2018); Fla. Bar v. De La Torre, 994 So. 2d 1032 (Fla. 2008).
“The purposes of attorney discipline are: (1) to protect the public
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from unethical conduct without undue harshness towards the
attorney; (2) to punish misconduct while encouraging reformation
and rehabilitation; and (3) to deter other lawyers from engaging in
similar misconduct.” Fla. Bar v. Dupee, 160 So. 3d 838, 853 (Fla.
2015); see also Fla. Bar v. Phoenix, 311 So. 3d 825, 833 (Fla. 2021).
Here, we find that the referee’s recommended discipline lacks
the support required by our cases. Disbarment is the appropriate
sanction for Mr. Koepke under our case law and the Standards. His
conduct demonstrated a willful lack of candor with the court and
abuse of the legal process. We focus on the intentionality of his
actions, his selfish motive, and the serious, adverse impact that his
actions had on the parties and underlying case.
A
Under Standard 5.1, “Failure to Maintain Personal Integrity,”
disbarment is appropriate when the attorney to be disciplined acted
“intentionally,” while suspension should be given when the attorney
acted “knowingly.” We have in the past found that the creation and
filing of fraudulent legal documents for an attorney’s personal gain
is a basis for disbarment. Fla. Bar v. Hall, 49 So. 3d 1254 (Fla.
2010) (disbarring an attorney who made and filed a falsified real
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estate sale agreement for her financial benefit). Mr. Koepke’s
decision to withhold the settlement agreement is of no meaningful
difference. Even leaving aside the time during which he might
plausibly have withheld it as subject to a pending motion to quash,
there is the matter of his having misled the court and the parties
about the fact that his personal injury case had settled; the fact
that he came to court for his trial without documents the court had
specifically compelled him to produce; and his failure to apprise the
court of what he had to produce until it reviewed the materials in
camera.
B
Standard 6.1 governs the sanctions for “False Statements,
Fraud, and Misrepresentation” by attorneys. Under this standard,
disbarment is appropriate rather than suspension when the
attorney acted intentionally, caused serious injury to a party, and
caused a significant adverse effect on the legal proceeding.
“[D]isbarment is the presumptive sanction for an attorney
knowingly presenting false testimony in a judicial proceeding.” Fla.
Bar v. Cox, 794 So. 2d 1278, 1279-80 (Fla. 2001) (ultimately
imposing a one-year suspension on a prosecutor who knowingly
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concealed information from the court and defendant due to
“substantial mitigation”). In Cox, the number and qualitative
weight of mitigating factors, including the lack of selfish motive and
Cox grasping the serious impact of her conduct, far surpassed the
single aggravating circumstance of Cox’s substantial experience in
the practice of law. Id. at 1281. Similarly, we stated that we “would
have no hesitation in imposing disbarment” on the attorney in
Florida Bar v. Hmielewski, 702 So. 2d 218, 221 (Fla. 1997), if not
for mitigating factors, particularly his lack of selfish motive. We
imposed a three-year suspension on Hmielewski for helping his
client conceal stolen medical records and blaming their absence on
the opposing party’s record-keeping. We determined that
Hmielewski was “overzealous in his efforts to promote his client’s
interests” rather than acting for personal gain. Id. (quoting referee’s
report). Here, the referee found a roughly equal number of
mitigating and aggravating factors, and the aggravating factors
included a selfish motive and Respondent’s refusal to acknowledge
the wrongful nature of his conduct. The mitigation does not
support departing from the “presumptive sanction” of disbarment.
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C
Standard 6.2 is relevant when an attorney’s actions involve the
“Abuse of the Legal Process.” The disbarment clause applies, rather
than the suspension clause, when the attorney caused serious,
rather than nonserious, interference with a legal proceeding or
when the attorney knowingly violated a court order for his benefit.
Mr. Koepke abused the legal process in a way that resulted in
a serious interference with his alimony proceedings. Representing
himself as both attorney and client, he dodged discovery requests
from his former wife’s counsel and refused to answer questions
truthfully. The trial judge “conservatively” estimated that Mr.
Koepke’s actions cost “100 or more hours of attorney time and
hours upon hours of court time to resolve.” Hearing Before Judge
Donald A. Myers at 45, In re Marriage of Koepke, No. 1990-DR-3247
(Fla. 9th Cir. Ct., June 28, 2018). Moreover, Mr. Koepke used the
delay occasioned by his failure to comply with the discovery order to
hastily settle a trust to put his contingency fee funds out of reach.
This was deceitful abuse of the process by someone who knew
better.
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D
Standard 7.1 applies to “Deceptive Conduct or Statements and
Unreasonable or Improper Fees.” Disbarment is appropriate when
a lawyer “engages in conduct that is a violation of a duty owed as a
professional with the intent to obtain a benefit for the lawyer or
another and causes serious or potentially serious injury to a client,
the public, or the legal system.” Again, Mr. Koepke’s actions check
those boxes. As an officer of the court, he owed a duty of candor
that he breached with the intent to shield funds that were subject,
under an order compelling production, to the court’s consideration.
Conduct so obstructing the court’s truth-finding mission for
pecuniary gain is irreconcilable with a lawyer’s duties.
“The public expects and deserves fairness and candor from
attorneys . . . . If we are to preserve the credibility of our self-
regulated profession, we must address breaches of that trust in a
manner that is commensurate with the severity of the breach.”
Cox, 794 So. 2d at 1286.
III
In reaching the conclusion that Mr. Koepke must be disbarred,
we are mindful that divorce proceedings can bring out the worst in
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people. Yet even at one’s worst, we expect a lawyer’s oath to mean
something. Indeed, we expect the oath to mean something then
especially.
Disbarment will be effective thirty days from the filing of this
opinion so that Mr. Koepke can close out his practice and protect
the interests of existing clients. If Mr. Koepke notifies this Court in
writing that he is no longer practicing and does not need the thirty
days to protect existing clients, this Court will enter an order
making the disbarment effective immediately. Mr. Koepke shall
fully comply with Rule Regulating the Florida Bar 3-5.1(h). Further,
Mr. Koepke shall accept no new business from the date this opinion
is filed.
Judgment is entered for The Florida Bar, 651 East Jefferson
Street, Tallahassee, Florida 32399-2300, for recovery of costs from
Karl O. Koepke in the amount of $2,606.73, for which sum let
execution issue.
It is so ordered.
CANADY, C.J., and POLSTON, LABARGA, LAWSON, and
MUÑIZ, JJ., concur.
GROSSHANS, J., recused.
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THE FILING OF A MOTION FOR REHEARING SHALL NOT ALTER
THE EFFECTIVE DATE OF THIS DISBARMENT.
Original Proceeding – The Florida Bar
Joshua E. Doyle, Executive Director, Patricia Ann Toro Savitz, Staff
Counsel, The Florida Bar, Tallahassee, Florida, and Karen Clark
Bankowitz, Bar Counsel, The Florida Bar, Orlando, Florida; and
Chris W. Altenbernd of Banker Lopez Gassler P.A., Tampa, Florida,
for Complainant
Karl O. Koepke, pro se, Orlando, Florida,
for Respondent
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