Office of Lawyer Regulation v. Geneva E. McKinley

2014 WI 48
SUPREME COURT OF WISCONSIN
CASE NO.: 2013AP2685-D
COMPLETE TITLE: In the Matter of Disciplinary Proceedings
Against Geneva E. McKinley, Attorney at Law:
Office of Lawyer Regulation,
Complainant,
v.
Geneva E. McKinley,
Respondent.
DISCIPLINARY PROCEEDINGS AGAINST McKINLEY
OPINION FILED: July 1, 2014
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:
SOURCE OF APPEAL:
COURT:
COUNTY:
JUDGE:
JUSTICES:
CONCURRED:
DISSENTED:
NOT PARTICIPATING:
ATTORNEYS:
2014 WI 48
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2013AP2685-D
STATE OF WISCONSIN : IN SUPREME COURT
In the Matter of Disciplinary Proceedings
Against Geneva E. McKinley, Attorney at Law:
Office of Lawyer Regulation, FILED
Complainant,
JUL 1, 2014
v.
Diane M. Fremgen
Clerk of Supreme Court
Geneva E. McKinley,
Respondent.
ATTORNEY disciplinary proceeding. Attorney's license
suspended.
¶1 PER CURIAM. We review a stipulation filed pursuant
to SCR 22.121 by the Office of Lawyer Regulation (OLR) and
1
SCR 22.12 states as follows: Stipulation.
(1) The director may file with the complaint a
stipulation of the director and the respondent to the
facts, conclusions of law regarding misconduct, and
discipline to be imposed. The supreme court may
consider the complaint and stipulation without the
appointment of a referee.
No. 2013AP2685-D
Attorney Geneva E. McKinley. In the stipulation, Attorney
McKinley admits that she pled no contest to and was convicted of
two misdemeanor counts of filing a tax return that she believed
was not true and correct, in violation of Wis. Stat.
§ 71.83(2)(a)2. She further admits that the conduct underlying
these two convictions constituted violations of SCR 20:8.4(b).
The stipulation requests this court to impose a 60-day
suspension of Attorney McKinley's license to practice law in
Wisconsin as discipline for the admitted misconduct. There is
no request for a restitution award or the imposition of any
conditions on the reinstatement of Attorney McKinley's license.
¶2 After closely reviewing this matter, we approve the
stipulation and suspend Attorney McKinley's license to practice
law in this state for a period of 60 days. We do not impose any
restitution obligation. Because this matter was resolved with a
stipulation under SCR 22.12, we do not require Attorney McKinley
to pay any of the costs of this proceeding.
¶3 Attorney McKinley was admitted to the practice of law
in this state in April 1996. According to the transcript of the
(2) If the supreme court approves a stipulation,
it shall adopt the stipulated facts and conclusions of
law and impose the stipulated discipline.
(3) If the supreme court rejects the stipulation,
a referee shall be appointed and the matter shall
proceed as a complaint filed without a stipulation.
(4) A stipulation rejected by the supreme court
has no evidentiary value and is without prejudice to
the respondent's defense of the proceeding or the
prosecution of the complaint.
2
No. 2013AP2685-D
plea and sentencing hearing in the criminal action, which was
filed in this matter in connection with the stipulation, during
much of the time relevant to the acts at issue in this matter
she maintained a solo law practice, in which she accepted
appointments from the Office of the State Public Defender and
represented private clients. In March 2007 she began employment
as a full-time court commissioner for the Milwaukee County
circuit court. As a result of the convictions described in this
opinion, she is no longer a court commissioner. Attorney
McKinley has never before been the subject of professional
discipline.
¶4 The state initially filed a criminal complaint against
Attorney McKinley in June 2011, alleging that she had committed
two felony counts of filing false or fraudulent tax returns, in
violation of Wis. Stat. § 71.83(2)(b)1. Those charges required
proof that the filing of the false tax returns had been done
"with intent to defeat or evade" the payment of state income
taxes. The criminal complaint alleged that Attorney McKinley
had underreported her income on her 2006 and 2007 state income
tax returns by a total of more than $117,000 and that the
estimated benefit of the underreporting on both her federal and
state tax returns had been slightly less than $33,000. The
prosecutor representing the state explained at the sentencing
hearing that Attorney McKinley had failed to report income from
certain private pay clients and from the rental of a commercial
building she owned. She also carried forward improper net
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No. 2013AP2685-D
business losses from her 2006 return that resulted in the
underreporting of income on her 2007 state income tax return.
¶5 After a lengthy pretrial stage, Attorney McKinley
reached a plea agreement with the state. According to the
prosecutor representing the state, because of some issues
regarding a couple of the state's witnesses that were unrelated
to the substance of their testimony but might impact their
credibility, the state agreed to file an amended information.
The amended information changed the applicable tax years for the
charges from 2006 and 2007 to 2005 and 2006. The prosecutor
explained that the income not reported on the 2005 state income
tax return was, as in 2006, attorney fees paid to Attorney
McKinley by a number of private pay clients. Although the
prosecutor did not indicate that the original charge for the
2007 tax return had been inaccurate in any regard, the amended
information no longer contained a charge regarding that tax
year.
¶6 The other substantial change in the amended
information was that the charges were reduced from felony
offenses to misdemeanors. Instead of charging Attorney McKinley
with filing false or fraudulent tax returns with the intent to
evade or defeat the assessment of state income taxes, in
violation of Wis. Stat. § 71.83(2)(b)1, the state now charged
Attorney McKinley with simply making and subscribing a tax
return that she did not believe to be true and correct in every
material matter, in violation of Wis. Stat. § 71.83(2)(a)2. The
4
No. 2013AP2685-D
misdemeanor charges did not include the element of intending to
evade or defeat the payment of state income taxes.
¶7 Attorney McKinley pled no contest to the two
misdemeanor counts alleged in the amended information. The
circuit court accepted her pleas and found her guilty of those
two offenses. Prior to sentencing, Attorney McKinley was
allowed an opportunity to address the court. She expressed
shame and remorse for her conduct, as well as a willingness to
seek treatment/counseling.
¶8 The circuit court agreed with the state's
recommendation to withhold sentence and place Attorney McKinley
on probation. It did not follow, however, the state's
recommendation for two years of probation, with six months of
jail time as a condition of probation. Instead, the circuit
court required Attorney McKinley to spend only five days in the
county jail over the 2013 Thanksgiving weekend as a condition of
her probation. It also set the period of probation at 18
months, which could be reduced to one year if Attorney McKinley
underwent eight sessions of grief counseling or individual
counseling. Finally, the circuit court required as a condition
of probation that Attorney McKinley obtain a mental health
assessment and follow up with any treatment recommendations that
resulted from that assessment.
¶9 The circuit court commented during its sentencing
statement that it did not believe that Attorney McKinley would
have intentionally endangered her job, her law license, and her
reputation to save a few thousand dollars in taxes. The court
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No. 2013AP2685-D
indicated that it believed there were other factors that had led
Attorney McKinley to fail to report certain amounts of income—
the illness and death of her mother and a serious depression
that corresponded with the time period of her misconduct.
¶10 By the time of Attorney McKinley's sentencing, she had
already made a $9,000 payment to the Wisconsin Department of
Revenue, which was equal to or near the amount of back taxes
owed for the 2005, 2006 and 2007 tax years.2 Following her
sentencing, Attorney McKinley timely self-reported her
convictions to the OLR.
¶11 As noted at the beginning of this opinion, Attorney
McKinley has stipulated with the OLR that she has been convicted
of the two misdemeanors described above, and that her conduct
leading to those convictions constituted violations of
SCR 20:8.4(b). In the stipulation, Attorney McKinley agrees
with the OLR's position that a 60-day suspension of her license
to practice law in Wisconsin would be an appropriate level of
discipline to impose in response to her misconduct. The
stipulation clearly states that it was not the result of plea
bargaining, and that Attorney McKinley has acceded to the
factual allegations, legal conclusions, and level of discipline
sought by the OLR.
2
At the time of sentencing, there were still unresolved
issues regarding the amount of interest and penalties that
Attorney McKinley owed to the state as a result of her
underreporting of income.
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No. 2013AP2685-D
¶12 The stipulation contains a number of representations
by Attorney McKinley. She states that she fully understands the
misconduct allegations against her and her right to contest
those allegations. She nonetheless admits her misconduct and
assents to the discipline sought by the OLR. She further states
that she fully understands the ramifications that will follow if
this court accepts the stipulation and imposes the requested
level of discipline. Attorney McKinley also represents that she
understands her right to consult with counsel in this matter.
Finally, she asserts that her entry into the stipulation is made
knowingly and voluntarily.
¶13 There is no dispute that Attorney McKinley's state
income tax returns for the relevant years contained information
that was not true and that Attorney McKinley did not believe to
be true. That is clearly sufficient for this court to find a
violation of SCR 20:8.4(b).
¶14 The only real issue here is whether the stipulated
level of discipline (a 60-day suspension) is an appropriate
level of discipline. In its memorandum in support of the
stipulation, the OLR states that it most closely considered four
precedents in analyzing what level of discipline it would seek
in this matter: Public Reprimand of William J. Grogan,
No. 2007-6 (consensual public reprimand for conduct including
failing to file timely state and federal tax returns over
several years and failing to cooperate with the OLR's
investigation); In re Disciplinary Proceeding Against Lex, 2000
WI 49, 235 Wis. 2d 381, 611 N.W.2d 456 (public reprimand imposed
7
No. 2013AP2685-D
on attorney with prior public reprimand for his intentional
failure to file income tax returns for several years; attorney
had experienced financial and professional hardships at time of
misconduct and had completed agreement to pay all taxes,
penalties, and interest); In re Disciplinary Proceedings Against
May, 215 Wis. 2d 456, 576 N.W.2d 544 (1998) (60-day suspension
imposed on attorney with previous private reprimand who was
criminally charged with failing to file timely state income tax
returns for 13 years, ultimately pled no contest to two
misdemeanor counts, and received probation); In re Disciplinary
Proceedings Against Thomas, 187 Wis. 2d 332, 522 N.W.2d 781
(1994) (60-day suspension imposed on attorney for intentionally
and repeatedly failing to file state and federal tax returns).
The OLR acknowledges that these four matters involved the
failure to file tax returns, either at all or on a timely basis,
while Attorney McKinley's conduct consisted of filing a false
tax return. Nonetheless, it asserts that Attorney McKinley's
misconduct was similar to that of Attorney Thomas and Attorney
May. In particular, it emphasizes that both Attorney May and
Attorney McKinley were convicted of two misdemeanors for their
tax-related misconduct.
¶15 In addition to prior precedent, the OLR states that it
took into consideration a number of mitigating factors,
including the lack of any prior discipline, Attorney McKinley's
depression and personal problems, her timely effort to pay the
back taxes, her timely report of her conviction, her complete
disclosure of her conduct to the OLR, and her expressions of
8
No. 2013AP2685-D
remorse for her conduct. On the other hand, the OLR also
acknowledged the financial benefit to Attorney McKinley of
underreporting her income as an aggravating factor.
¶16 The OLR's memorandum fails to acknowledge that this
court has also on a substantial number of occasions imposed much
more severe discipline in cases involving tax-related
convictions. See, e.g., In re Disciplinary Proceedings Against
Phillips, 2007 WI 63, 301 Wis. 2d 33, 732 N.W.2d 17 (three-year
suspension imposed on attorney convicted of willful attempted
federal tax evasion for concealing the proceeds of a loan so
that it could not be attached by the Internal Revenue Service);
In re Disciplinary Proceedings Against Washington, 2007 WI 65,
301 Wis. 2d 47, 732 N.W.2d 24 (18-month suspension imposed on
attorney convicted of attempting to evade and defeat the payment
of a large portion of her federal income taxes by not reporting
over $90,000 in income in one tax year; evidence also showed
similar conduct in two other tax years).
¶17 We recognize, however, that the convictions against
Attorney Phillips and Attorney Washington involved the element
of attempting to evade or defeat the payment of income taxes.
While the state originally charged Attorney McKinley with
offenses that included this same element, it ultimately agreed
to lesser charges of filing tax returns that Attorney McKinley
knew to be false or inaccurate. Consequently, we must base our
determination on the offenses that have been admitted in the
criminal case because neither the state in the criminal case nor
the OLR in this disciplinary proceeding has obtained a finding
9
No. 2013AP2685-D
from a trier of fact that Attorney McKinley attempted to evade
the payment of state income taxes. Thus, the Phillips and
Washington matters are not directly analogous with respect to
the proper sanction.
¶18 Of greater assistance in resolving this case is our
discussion of Attorney Jeffrey Elverman's failure to report
$230,000 in income from co-trustee fees on his state and federal
income tax returns for five years. In re Disciplinary
Proceeding Against Elverman, 2008 WI 28, 308 Wis. 2d 524, 746
N.W.2d 793. Importantly, in that decision we divided our
analysis of Attorney Elverman's failure to report the trustee
fee income into two categories. In the first three years,
Attorney Elverman claimed that he had simply forgotten to report
the trustee fees as income. We stated that if this had been the
only misconduct at issue, we might have been more inclined to
impose a public reprimand, in line with Lex and In re
Disciplinary Proceedings Against Young, 2006 WI 109, 296 Wis. 2d
36, 718 N.W.2d 717. Elverman, 308 Wis. 2d 524, ¶48. For the
last two years at issue, however, Attorney Elverman admitted
that he knew he was supposed to report the trustee fees as
income, but deliberately chose not to do so in order to pay
other personal financial obligations. Id. We concluded that
this was a more serious level of misconduct that moved the
matter on the continuum of culpability more toward what had
occurred in Phillips and Washington. Consequently, we suspended
Attorney Elverman's license for a period of nine months. Id.,
¶¶49-50.
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 No. 2013AP2685-D
¶19 Similarly, Attorney McKinley did not simply fail to
file her tax returns, as was the situation in the Grogan and Lex
matters cited by the OLR. She was convicted of filing state
income tax returns that she believed were not true or correct,
which appears to be a more serious offense. On the other hand,
she was not convicted of attempted tax evasion, as were Attorney
Phillips and Attorney Washington. Without more, these facts
would seem to call for a suspension of more than a couple
months.
¶20 There is more in this case, however. Although the OLR
could have provided more information about the impact of
Attorney McKinley's depression on her misconduct in the
stipulation or in its statement in support of the stipulation,
the OLR is clearly taking Attorney McKinley's depression into
account as a mitigating factor in the level of discipline it is
seeking. There is some discussion of the depth of Attorney
McKinley's depression in the transcript of the plea and
sentencing hearing in the criminal case that has been filed in
connection with the stipulation. We factor that into our
analysis. In addition, Attorney McKinley has never before been
the subject of professional discipline. When her failure to
report all of her income came to light, she made timely efforts
to pay the back taxes that she owed and she expressed remorse
for her misconduct.
¶21 In light of these mitigating factors, we accept the
stipulation and impose the jointly requested sanction of a 60-
day suspension of Attorney McKinley's license to practice law in
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No. 2013AP2685-D
this state. We are confident that Attorney McKinley recognizes
the seriousness of her misconduct. Filing tax returns that a
person knows or believes are not true because they do not
include all of a person's income is a grave matter. Attorney
McKinley's criminal convictions and the resulting loss of her
job have demonstrated that fact. The suspension of her license
to practice law in this state, even though tempered in this
instance because of mitigating factors, is a further indication
that such conduct carries serious consequences.
¶22 We do not impose any restitution in this matter. In
addition, because this matter was resolved with the filing of a
stipulation under SCR 22.12 and without the appointment of a
referee, we also do not require Attorney McKinley to pay any
costs.
¶23 IT IS ORDERED that the license of Geneva E. McKinley
to practice law in Wisconsin is suspended for a period of 60
days, effective July 31, 2014.
¶24 IT IS FURTHER ORDERED that Geneva E. McKinley shall
comply with the provisions of SCR 22.26 concerning the duties of
a person whose license to practice law in Wisconsin has been
suspended.
¶25 IT IS FURTHER ORDERED that compliance with all
conditions of this order is required for reinstatement. See
SCR 22.28(2).
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No. 2013AP2685-D
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