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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. In Re Rice (8/26/2011) sp-6592

In Re Rice (8/26/2011) sp-6592, 260 P3d 1020

        Notice:   This opinion is subject to correction before publication in the PACIFIC REPORTER. 
        Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 303 
        K   Street,   Anchorage,   Alaska   99501,   phone   (907)   264-0608,   fax   (907)   264-0878,   email 
        corrections@appellate.courts.state.ak.us. 

                  THE SUPREME COURT OF THE STATE OF ALASKA 

In the Disciplinary Matter Involving                 )    Supreme Court No. S-13856 
                                                     ) 
JOHN M. RICE, Attorney.                               )   ABA File Nos. 2006D188, 2007D006, 
                                                     )    and 2007D260 
                                                     ) 
                                                     )    O P I N I O N 
                                                     ) 
                                                     )    No. 6592 - August 26, 2011 

                 Appeal     from    the  Disciplinary      Board    of  the   Alaska    Bar 
                 Association. 

                 Appearances:   Fred W. Triem, Petersburg, for John M. Rice. 
                 Mark   Woelber,   Assistant   Bar   Counsel,   and   Stephen   Van 
                 Goor, Bar Counsel, Anchorage, for Alaska Bar Association. 

                 Before:    Carpeneti, Chief Justice, Fabe, Winfree, Christen, 
                 and Stowers, Justices. 

                 CHRISTEN, Justice. 

I.      INTRODUCTION 

                 Upon   receiving   notice   that   an   attorney   had   overdrawn   his   client   trust 

account, the Alaska Bar Association opened a discipline investigation and requested trust 

account records from the attorney.  The documentation submitted by the attorney raised 

concerns   about   his   compliance   with   trust   account   record-keeping   rules.           The   Bar 

ultimately filed a formal petition for hearing alleging that the attorney had engaged in 

misconduct under Alaska Rule of Professional Conduct 1.15 (failing to safeguard and 

account   for   client   funds)   and   Alaska   Bar   Rule   15(a)(4)   (failing   to   respond   to   Bar 

----------------------- Page 2-----------------------

Counsel's discovery requests and subpoena).  The Area Hearing Committee granted the 

Bar's motion for summary judgment on Bar Rule 15(a)(4), but denied summary judgment 

on Alaska Rule of Professional Conduct 1.15 because the committee had insufficient 

information to determine whether trust misconduct had occurred. 

                The attorney produced a large number of records shortly before the hearing, 

and the committee held its hearing in abeyance to allow Bar Counsel time to review 

them.    It instructed the parties to report back so it could determine whether a further 

hearing was necessary.   The Bar filed a status report laying out its case and stating that 

it did not request another hearing, but the attorney did not respond.             The Area Hearing 

Committee issued findings and conclusions establishing that the attorney had violated 

Alaska     Rule    of  Professional    Conduct     1.15;   about    one   month    later,  it  issued   a 

recommendation that the attorney be suspended for four years. 
                Both parties appealed to the Disciplinary Board.1          In his opposition brief to 

the Board, the attorney argued that the Area Hearing Committee had denied him due 

process by truncating its hearing before he  had presented his full case.                  The Board 

allowed the attorney to submit any additional evidence he wished to have considered. 

After   a   second   hearing,   the   Board   issued   a   final   order   adopting   the   Area   Hearing 

Committee's recommendation for discipline (and implicitly adopting the Area Hearing 

Committee's findings and conclusions). The attorney appeals. Based on our independent 

review of the record, we agree with the Disciplinary Board's recommended sanction. 

        1       When      the  Bar   Association     Board    of  Governors      acts  on   appeals   of 

disciplinary matters, it is referred to as the "Disciplinary Board."  Alaska Bar R. 10(a). 

                                                  -2-                                               6592 

----------------------- Page 3-----------------------

II.     FACTS AND PROCEEDINGS 

        A.      Grievances And Subpoena 

                On November 27, 2006, the Alaska Bar Association received a notice from 

Wells Fargo Bank that attorney John Rice's client trust account had insufficient funds to 

cover a $1,000 check Rice had written to himself. Wells Fargo subsequently sent the Bar 

Association two additional non-sufficient-funds (NSF) notices associated with separate 

instances of overdrafts from Rice's client trust account.  Investigations were opened in 

connection with each NSF notice.   Rice responded to the Bar Association regarding the 

first two of these investigations, but not the third. 

                In February 2007, March 2007, and January 2008, the Bar notified Rice that 

it had opened discipline investigations in connection with each of the NSF notices.                  In 

its first two letters and a subsequent telephone call, the Bar directed Rice to submit his 

2006 trust account records.   Rice responded by providing 2006 bank statements for his 

client trust account and copies of some but not all checks for 2006. 

                In   December   2007   Bar   Counsel   sent   Rice   a   letter   noting   that   Rice's 

accounting practices raised concerns "not only about the status of [his] trust account in 

2006 but also about [his] compliance with the trust accounting rules during 2007 and to 

the present."   The letter asked Rice to provide specific information, including the source 

and purpose of each deposit made to the trust account and the circumstances of two 

bounced $10,000 checks, along with documentation such as individual client ledgers and 

deposit slips for 2006 and 2007.  Rice asked for additional time to comply with the Bar's 

request.   By mid-April, however, Rice had not yet responded to the discovery requests, 

and on April 14, 2008, the Bar obtained a subpoena commanding Rice to produce, among 

other items, all paper and electronic records relating to his trust accounts, general office 

accounts, and individual client ledgers for 2006 and 2007. 

                                                  -3-                                            6592
 

----------------------- Page 4-----------------------

                Rice   acknowledged   the   Bar's   subpoena   and   indicated   that   he   would 

respond.     On   July   17   the   Bar   received   from   Rice   an   unpadded   manila   envelope 

containing   an   unlabeled   CD,   broken   in   half   and   unreadable.  There   were   no   other 

documents in the envelope.  Bar Counsel believed Rice knew the CD was broken when 

he sent it, although Rice disputes this.   The Bar did not immediately inform Rice that the 

CD was broken. 

        B.      Motions And Formal Hearing Before The Area Hearing Committee 

                The Bar filed a petition for formal hearing on October 1, 2008.  It alleged 

that Rice had engaged in misconduct under Alaska Rule of Professional Conduct (ARPC) 

1.15 by failing to safeguard and account for client funds, and under Alaska Bar Rule 

15(a)(4) by failing to respond to Bar Counsel's discovery requests and subpoena.                 The 

petition   recommended   that,   based   on   the   American   Bar   Association   Standards   for 

Imposing Lawyer Sanctions, the appropriate sanction for Rice's misconduct was at least 

suspension.     The petition gave notice that the CD Rice mailed to the Bar was broken 

when it arrived. Rice answered the petition, denying the Bar's allegations of misconduct 

under ARPC 1.15. 

                In February 2009 the Bar moved for summary judgment on its ARPC 1.15 

and Bar Rule 15(a)(4) allegations.   Rice did not initially file an opposition to the motion 

for summary judgment, because, as he later explained, he considered the motion to be 

"premature." 

                The   Area   Hearing   Committee   (Hearing   Committee)   held   a   pre-hearing 

conference on March 19, 2009.          Shortly afterward, the Bar filed a motion to grant its 

unopposed motion for summary judgment and to close motion practice.                   On the same 

day, Rice filed a motion to reopen discovery, a motion to recuse Bar Counsel on the 

grounds that he was a witness in the formal hearing, and a motion for additional time to 

conduct discovery before filing his opposition to summary judgment.                   The Hearing 

                                                 -4-                                            6592
 

----------------------- Page 5-----------------------

Committee denied the motions to reopen discovery and recuse Bar Counsel, and ordered 

Rice to submit his opposition to the Bar's summary judgment motion within five days. 

              Rice opposed the summary judgment motion on May 11, 2009.               In his 

opposition, he claimed that he had provided the Bar with all of the requested information 

on the CD and was never informed by the Bar (prior to the petition for formal hearing) 

that the disc had arrived broken.     He also argued that the NSF charges, alone, were 

insufficient grounds for an investigation.  The Hearing Committee heard oral argument 

on the summary judgment motion on May 13. 

              Rice filed motions to quash the Bar's subpoena and for a protective order 

on May 27.   The first motion argued that "the subpoena was unnecessary and primarily 

sought by bar counsel to assist . . . in arguing that respondent had not cooperated . . . in 

its investigation."   He also claimed that he would have sent a new copy of the CD, 

allegedly containing the requested information, if Bar Counsel had requested it prior to 

filing the petition for formal hearing.  The second motion requested a protective order to 

preserve client confidentiality in any records Rice filed with the Bar.  Rice also moved 

to stay the disciplinary hearing until completion of the investigation.  The Bar   opposed 

to the motion to quash and filed a qualified non-opposition to the motion for protective 

order.   On June 25, Fred Triem entered his appearance as Rice's attorney and filed a 

motion to reschedule the hearing that had been set for July 8.  The Hearing Committee 

rescheduled its hearing for August 3, but it did not address Rice's motion to quash the 

subpoena or his motion for a protective order. 

              On July 2 the Hearing Committee denied summary judgment on the alleged 

violation of ARPC 1.15, explaining that the committee was "handicapped by insufficient 

information as to . . . whether there is a pattern of neglect or misuse" and noting that the 

issue would be ripe for decision after the scheduled evidentiary hearing. But the Hearing 

                                             -5-                                       6592
 

----------------------- Page 6-----------------------

Committee granted summary judgment on the allegation that Rice had failed to cooperate 

with the Bar's investigation in violation of Bar Rule 15(a)(4). 

               Rice produced records in response to the Bar's subpoena on July 2, 2009. 

The Bar received more records from Rice on July 31, one business day before the August 

3 hearing.   On the morning of the hearing, Rice submitted hundreds of additional pages 

of accounting records.  Bar Counsel objected at the hearing that the last-minute receipt 

of these records made it impossible to properly review and investigate them prior to the 

hearing.     The   Hearing   Committee   allowed   Rice's   documents   to   be   discussed   at   the 

hearing, but a further complication was presented by the logistics of the hearing and 

Rice's last-minute production of documents.  The hearing was held in Juneau; Rice and 

his attorney were in Juneau, but Bar Counsel participated from Anchorage.                Rice was 

apparently aware that Bar Counsel planned to participate by telephone because he had 

the large additional set of responsive documents delivered to Bar Counsel's Anchorage 

office.  He did not have a set prepared for the Hearing Committee to use in Juneau. 

               Bar Counsel presented the testimony of Deborah Ricker, the Bar discipline 

investigator/paralegal who had reviewed Rice's accounting records. Ricker testified that 

the records Rice submitted, while insufficient to form a "complete impression," were 

sufficient to indicate that there might be problems with client trust account management. 

She pointed to frequent withdrawals from the client trust account to Rice or to his general 

office account in even amounts and noted that this pattern raised questions about whether 

Rice was withdrawing unearned fees.          Ricker also noted that the Client Trust Liability 

Register provided by Rice appeared to have been reconstructed after the fact, rather than 

kept   contemporaneously   with   the   recorded   transactions.    Upon   examination   by   Bar 

Counsel, Rice acknowledged that he had not sent any information to the Bar between the 

time the Bar filed its formal petition and the time that Rice's counsel began producing 

documents on Rice's behalf.        Rice expressed surprise at the extent of Bar Counsel's 

                                                -6-                                           6592
 

----------------------- Page 7-----------------------

questions, claiming he "did not come here prepared to [talk] in detail about all of these 

hundreds of entries in these client registers." 

                 During Bar Counsel's examination of Rice but before Rice's own counsel 

examined   him,   the   Hearing   Committee   chair   proposed   that   the   hearing   be   held   in 

abeyance to allow Rice and his attorney to work with Bar Counsel to produce a more 

complete   record   of   Rice's   accounting,   after   which   the   parties   and   committee   could 

reconvene.   The Hearing Committee chair described his decision as follows: 

                 I would like to order that both sides confer and make good 
                 faith efforts to produce a complete set of documentation, and 
                by 'complete,' I mean sufficient to enable bar staff to make 
                 their own determinations as to the trust violation allegations 
                 .   .   .   and   then   report   back   with   full   documentation   to   the 
                 committee   .   .   .   .   Maybe   we   won't   even   need   more   live 
                hearings at that point; maybe we will; we'd have to confer at 
                 that point. 

The Hearing Committee chair told the parties to report back by August 24, at which point 

a decision would be made about whether further hearings were needed. At the end of the 

hearing,   Rice's   attorney   brought   up   Rice's  outstanding   motions   to   quash   the   Bar's 

subpoena and for protective order.            The Hearing Committee chair responded, "At the 

moment, we're not going to quash anything and we'll maintain the current arrangement 

we have for maintaining confidentiality" (i.e., if documents were released to parties 

outside the proceedings, all private information would be redacted). 

        C.	      The    Bar's    Status    Report     And    Hearing     Committee        Findings     And 
                 Conclusions 

                 In response to the Hearing Committee chair's oral order, the Bar filed a 

status report on August 31. This report listed all the records produced by Rice before the 

August 3 hearing, as well as additional records produced four days after the hearing; 

these included canceled checks, detailed transaction sheets by client, and trust account 

                                                    -7-	                                             6592
 

----------------------- Page 8-----------------------

registers.   The Bar's status report explained why the Bar continued to allege violations 

of ARPC 1.15 and also stated that the Bar did not require further hearings. 

               Rice did not file a status report, nor did he respond to the Bar's status 

report. The Hearing Committee interpreted Rice's silence to mean that he and his lawyer 

had "indicated to the Committee that neither intended to present more testimony on the 

topic of whether violations had occurred." 

                On   October   2,   2009,   the   Hearing   Committee   issued   its   findings   and 

conclusions. After reiterating its earlier grant of summary judgment regarding violations 

of Bar Rule 15(a)(4), the Hearing Committee addressed the Bar's allegations under 

ARPC 1.15(a) and (b) and stated, "[w]hen repeated NSF checks occur and a trust account 

is used as an auxiliary repository for the lawyer's own funds, there is certainly evidence 

of neglect or misuse of the trust account sufficient to violate ARPC 1.15."  The Hearing 

Committee went on to detail problems and inconsistencies associated with the trust funds 

of several specific clients, concluding from these client accounts that "Mr. Rice regularly 

removed client funds from trust accounts before they were invoiced or earned, and in 

amounts that bore little or no relation to any . . . invoice" and that these withdrawals left 

the trust accounts "regularly short of funds."  It also found evidence of commingling of 

attorney and client funds. 

        D.	     Sanctions   Briefing   And   Hearing   Committee   Recommendation   On 
                Sanctions 

                Concurrent with the findings and conclusions, the Hearing Committee chair 

issued an order addressing briefing on sanctions.           The order gave notice that Rice's 

counsel should notify the Bar office if he wished to request a sanctions hearing.  The Bar 

timely filed a sanction brief in which it argued that the ABA guidelines for disciplinary 

                                                 -8-	                                          6592
 

----------------------- Page 9-----------------------

sanctions,2 as well as prior Alaska case law, called for Rice's disbarment.  Rice did not 

ask for a hearing on sanctions, nor did he file a brief addressing sanctions. 

                The Hearing Committee issued its recommendation on sanctions at the end 

of   October   2009.    It   found   that   Rice's   lack   of   prior   disciplinary   violations   was   a 

mitigating factor, but that his willful failure to cooperate with the Bar's investigation was 

an aggravating factor. Having considered prior disciplinary case precedent as well as the 

ABA guidelines, the Hearing Committee recommended that Rice be suspended for four 

years, with one year of the suspension stayed on the condition that Rice inform his past 

clients of his suspension and urge them to contact the Bar if they believed their trust 

funds had not been properly applied or refunded. 

                Rice filed a motion for reconsideration of the recommendation on sanctions. 

He also requested a hearing and argued that he had relied on the Hearing Committee's 

statement in its findings and conclusions that it would hold a hearing on sanctions.  The 

Hearing   Committee   denied   Rice's   motions   for   reconsideration   and   further   hearing, 

explaining that the Order on Briefing on Sanctions had explicitly required Rice to notify 

the committee if he wanted a sanctions hearing.              By failing to do so, the committee 

reasoned, Rice "waived . . . his opportunity to submit argument on sanctions." 

        E.      Appeal To Disciplinary Board 

                The Bar appealed the Hearing Committee's recommendation, arguing that 

Rice should be disbarred rather than suspended.  Rice cross-appealed on the appropriate 

sanction but also appealed on a number of other grounds. Among other things, he argued 

that the recommended four-year suspension was too harsh in light of his cooperation with 

the Hearing Committee and maintained that he did not act dishonestly, keep client funds, 

        2       AMERICAN       BAR    ASSOCIATION,        STANDARDS       FOR   IMPOSING     LAWYER 

SANCTIONS       1   (2005),   http://www.abanet.org/cpr/regulation/standards_   sanctions.pdf 
(hereinafter ABA Standards). 

                                                  -9-                                               6592 

----------------------- Page 10-----------------------

or harm any clients.      Rice also contested the Hearing Committee's conclusion that he 

violated   Bar   Rule   15(a)(4),   arguing   that  he   had   eventually   provided   all   requested 

information and had only delayed doing so because he was waiting for the Hearing 

Committee to rule on his motions for protective order and to quash the subpoena. 

                Pursuant to an order from the Disciplinary Board, the Bar and Rice each 

submitted opening briefs to the Board, followed by simultaneous opposition briefs.  In 

his opposition brief, Rice raised the issue of due process for the first time, arguing that 

the Hearing Committee:          (1) denied him due process by truncating its formal hearing 

before Rice put on his defense; and (2) converted the Bar's status report into a motion 

for summary judgment without giving him notice of its intent to do so and allowing him 

to respond to new evidence. 

                The   Disciplinary   Board   convened   on  January   29,   2010.         Bar   Counsel 

reiterated his argument that the ABA Standards for Imposing Lawyer Sanctions justified 

disbarment in this case.       Rice's counsel acknowledged that the issue before the Board 

was the appropriate sanction for Rice's misconduct, but contrasted Rice's situation with 

that of other Alaska attorneys who received multi-year suspensions for what he argued 

were more serious offenses.         Rice's counsel also argued that it should be considered a 

mitigating   factor   that   Rice  provided   the   data   with   which   the   Bar   built   its   case   and 

repeated the due process argument raised in Rice's opposition brief. 

                The Disciplinary Board issued an order allowing Rice to submit any new 

documentary        evidence    he   wished     the  Board    to  consider     regarding    the   Hearing 

Committee's   findings   and   sanction   recommendation,   and   allowing   him   to   request   a 

hearing before the Disciplinary Board to present sworn testimony.  Rice timely filed an 

affidavit, copies of trust account and general account checks, and a request for a hearing 

before the Board at its regular April meeting. 

                                                  -10-                                             6592
 

----------------------- Page 11-----------------------

              The Disciplinary Board reconvened on April 26, 2010.            The Board first 

addressed Rice's objection to the participation of two Board members who had not been 

present at the first hearing and decided to allow those members to participate.       Rice's 

attorney then corrected a misstatement he had made at the previous hearing to the effect 

that Rice did not keep individual ledger cards for his clients; he stated that Rice did keep 

individual ledger cards and sought to withdraw "the suggestion that discipline [was] 

appropriate because of the admission that [he] should not have made."  Rice's attorney 

acknowledged that the individual client ledgers had not been produced to the Board, 

contending that it was not "within the scope of the authority of the [D]isciplinary [B]oard 

to conduct a plenary evidentiary hearing" because its purpose was to serve as a reviewing 

court.   Instead, Rice requested remand for a full evidentiary hearing before the Hearing 

Committee.  Rice's counsel also argued that Rice's testimony itself served as adequate 

proof that he had maintained individual client ledgers, even though those ledgers had not 

been produced. 

              Rice testified on his own behalf.    In response to questions from members 

of the Board and his own counsel, he attempted to explain the circumstances behind each 

of the NSF notices issued by Wells Fargo.      He cited various causes for the overdrafts, 

including an allegedly unauthorized withdrawal by GCI for a telephone bill and that an 

associate accidentally drafted a check out of Rice's client trust account rather than his 

business account. Rice stated that he had closed his client trust account shortly after July 

30, 2009, and had stopped taking clients who requested that he hold money for them in 

trust.   The Bar did not present evidence or argument at this hearing. 

              On    April   27  the  Board   issued a   final  order  adopting   the  Hearing 

Committee's recommendations regarding sanctions.  Rice appeals the Board's decision. 

                                             -11-                                       6592
 

----------------------- Page 12-----------------------

III.    STANDARD OF REVIEW
 

                We   have   noted   that   "[t]he   appropriate   standard   of   review   for   attorney 
disciplinary proceedings is well established."3   "Though this court has the authority, if 

not the obligation, to independently review the entire record in disciplinary proceedings, 
findings of fact made by the Board are nonetheless entitled to great weight."4                    Thus, 

"[w]here   findings   of   fact   entered   by   the   Board   are   challenged   on   appeal   to   this 

court, . . . the respondent attorney bears the burden of proof in demonstrating that such 

findings are erroneous. . . . As a general rule . . . we ordinarily will not disturb findings 
of fact made upon conflicting evidence . . . ."5 

                We apply our independent judgment when determining the appropriate 

sanctions in cases of attorney discipline; we "need not accept the Disciplinary Board's 
recommendation."6         Our   determination   of   sanctions   is   guided   by   the   American   Bar 

Association's Standards for Imposing Lawyer Sanctions,7 but is "not constrained" by 

them.8 

        3       In re West, 805 P.2d 351, 353 n.3 (Alaska 1991). 

        4       Id.  (quoting  In   re   Simpson,   645   P.2d   1223,   1226-28   (Alaska   1982), 

methodology modified by In re Buckalew, 731 P.2d 48 (Alaska 1986)). 

        5       Id. 

        6       Id. 

        7       See In re Buckalew, 731 P.2d at 51-52. 

        8       In re Frost, 863 P.2d 843, 854 (Alaska 1993). 

                                                  -12-                                             6592
 

----------------------- Page 13-----------------------

IV.	   DISCUSSION 

       A.	    The Hearing Committee And Disciplinary Board Did Not Deny Rice 
              Due Process. 

              1.	    The Hearing Committee properly granted summary judgment 
                     on   Rice's  failure  to  cooperate  with   the  Bar's  requests   for 
                     information. 

              Rice contends that the Hearing Committee's grant of summary judgment 

against him on the grounds of his failure to cooperate under Alaska Bar Rule 15(a)(4) 

was improper for three reasons:  (1) there was a genuine issue of material fact as to 

whether Rice deliberately broke the CD he sent to the Bar; (2) when it became clear that 

the Hearing Committee was not going to rule on his motions for protective order or to 

quash the subpoena, Rice submitted the requested documents; and (3) Rice's motions to 

quash the Bar's subpoena and for protective order were pending at the time the Hearing 

Committee granted summary judgment.  We find these arguments unconvincing. 

              First, we observe that none of the Hearing Committee's conclusions rely 

upon disputed issues of fact.  The language cited by Rice for this claim simply reflects 

what the record clearly shows:      the CD did, in fact, arrive in an unusable state, and 

although Rice expressed his willingness to provide the information, he had not provided 

it by the time the Hearing Committee issued its order granting summary judgment in July 

2009.   The Hearing Committee did not find that Rice broke the CD.       Its determination 

that Rice violated Bar Rule 15(a)(4) was based on Rice's continuing failure to provide 

the subpoenaed information after he learned from the October 1, 2008 petition for formal 

hearing that the CD had arrived broken - regardless of what caused it to break.  It was 

never fully resolved how the CD broke, but this issue was not material to the Hearing 

Committee's decision and did not preclude entry of summary judgment. 

              The fact that Rice eventually provided information requested by the Bar 

does not excuse his earlier delays, particularly given that the record suggests Rice never 

                                           -13-	                                     6592
 

----------------------- Page 14-----------------------

provided all of the requested information.  For instance, although Rice's attorney argued 

before the Disciplinary Board that he supplied information to the Bar in satisfaction of 

the subpoena, he also acknowledged that the individual client ledgers requested in the 

subpoena had not been produced to the Bar, the Hearing Committee, or the Disciplinary 
Board.9 

                Second, Rice argues that "[b]ecause [he] supplied the very information on 

which the Hearing Committee found an ethical violation, the Hearing Committee order 

granting summary judgment on [his] failure to cooperate should be reversed."  But this 

argument overlooks Rice's duty under Bar Rule 15(a)(4) and the subpoena to provide all 

the   documentation       requested    by   the  Bar   for  its  investigation.   The     fact  that  the 

information he did provide proved sufficient for the Bar to demonstrate trust accounting 

violations did not relieve him of his duty, nor does his partial and reluctant compliance 

constitute a mitigating factor. 

                Finally,    Rice's   motion    to  quash    the  Bar's   subpoena     and   motion    for 

protective order did not explain his failure to cooperate with the Bar's investigation prior 

to filing those motions.  The subpoena was issued in April 2008.   The Bar received the 

broken CD on July 17, 2008.   On October 1, the Bar filed its petition for formal hearing, 

stating   that   the   CD   had   arrived   broken. By   the   time   the   Bar   moved   for   summary 

judgment on February 18, 2009, Rice had known for four and a half months that the CD 

had arrived broken, but he did not resubmit the requested information in order to comply 

with the subpoena.       Rice then waited another three months before filing his motions to 

        9       Rice's attorney attempted to justify the failure to provide these documents 

by arguing "that either the Area Hearing Committee should have granted the motion to 
quash, or should have granted some protective order to protect the identity of the clients" 
identified in the ledgers.  This reasoning is inconsistent with Rice's claim that, once he 
understood that the Hearing Committee was not going to rule on his motions, he fully 
complied with the subpoena. 

                                                  -14-                                            6592
 

----------------------- Page 15-----------------------

quash the subpoena and for protective order. (The Hearing Committee ultimately granted 

summary judgment on Bar Rule 15(a)(4) on July 2, 2009; it subsequently addressed 

Rice's motions at its August 3 hearing, when the Hearing Committee chair stated, "At 

the   moment,    we're  not  going   to  quash  anything   and  we'll  maintain   the  current 

arrangement we have for maintaining confidentiality.") We hold that Rice's delay during 

this nearly eight-month period (October to May) was sufficient to constitute a violation 

of Bar Rule 15(a)(4) for failure to furnish information and respond to requests from Bar 

Counsel    and   the  Hearing  Committee.     Rice's   subsequently   filed  motions  do   not 

retroactively cure this violation. 

              We further observe that Rice's failure to cooperate persisted throughout the 

proceedings. Rice produced hundreds of pages to the Bar immediately before the August 

3 hearing, making it difficult for the Bar to prepare.  More problematically, Rice did not 

provide copies of those records to the Hearing Committee in Juneau, forcing committee 

members to examine a document at one point during the hearing by viewing defense 
counsel's laptop computer.10   Rice has repeatedly referred to documents and information 

- most notably individual client ledgers - that he claims to be able to provide but has 

not produced.   Even as late as his oral argument before our court, Rice's attorney argued 

that Rice had access to client ledger cards he was willing to produce, but acknowledged 

that this data had not been submitted at earlier stages of the proceedings. 

              2.	    Rice waived his right to a further hearing on the issue of his 
                      alleged accounting misconduct. 

              Rice    argues  that  the  Hearing  Committee    "improperly    truncated  [his] 

evidentiary hearing on [August 3, 2009] by receiving evidence only from the Bar but not 

from Rice[] - thus denying Rice his 'day in court,' and his opportunity to be heard." 

       10     As the Bar notes in its brief, it was unable to "provide the Committee, in 

Juneau, with records [it] received that day in Anchorage." 

                                            -15-	                                        6592 

----------------------- Page 16-----------------------

The Bar contends that "the Committee did not deny Rice a hearing"; rather, Rice "elected 

to   not   testify   or   present   any   further   defense,"   agreeing   "by   his   silence"   with   the 

conclusion in the Bar's status report that further hearings were unnecessary. 

                Under Alaska Bar Rule 22, a responding attorney is entitled to a hearing on 

disciplinary   allegations   and   is   generally   not   required   to   request   the   opportunity   to 

examine witnesses or present evidence.  The exchanges between Rice's attorney and the 

Hearing Committee chair at the August 3 hearing tended to suggest that a follow-up 

hearing would occur:          Rice's attorney said, "I do think that it's inevitable that we're 

going to need at least some time [with] all of us together again in a live hearing, so that 

I can put on my defense."         The Hearing Committee chair replied:             "You have the right 

to put on a live witness, present your defense.  We will never deny you that." 

                 At the same time, the Hearing Committee made it clear that Rice and the 

Bar were to report back later that month, after reviewing the late-produced discovery and 

gathering additional evidence, so that the Hearing Committee could determine whether 

further   hearings   were   necessary.       On   August   31   the   Bar   submitted   a   status   report 

indicating that it was resting its case:   the report claimed that "the evidence in the record 

already proves the violations charged in the petition for formal hearing" and concluded, 

"the Bar does not intend to further examine Rice . . . [or] to call any other witnesses or 

introduce any evidence beyond what is submitted and discussed with this report. The Bar 

does not request any further hearings and withdraws all previous requests for hearings." 

By declining to request a hearing and arguing that the Hearing Committee could reach 

a decision without additional evidence, the Bar's status report put Rice on notice that he 

would need to request a hearing if he wanted one.               But Rice did not do so.        Nor did he 

file his own status report in the month before the Hearing Committee issued its findings 

and conclusions, or otherwise respond to the Bar's claim that the evidence in the record 

was sufficient to prove its case against him. 

                                                   -16-                                              6592
 

----------------------- Page 17-----------------------

                If the failure to verify whether Rice wanted to continue the hearing before 

the   Hearing     Committee      issued   its  recommendations       did   constitute   a  due   process 

violation, Rice waived any due process claim by neglecting to raise it until midway 

through his appeal to the Disciplinary Board. The Hearing Committee issued its findings 

and conclusions and requested briefing on sanctions on October 2, clearly indicating that 

it had made its decision and did not plan to hold another hearing.               Rice did not file an 

objection to the issuance of the decision.         The Bar filed a sanctions brief; Rice did not 

respond. After the Hearing Committee issued its recommendation on sanctions at the end 

of    October     2009,    Rice    filed   a  motion    for    reconsideration      of   the   sanctions 

recommendation.         This motion did not raise the due process issue.             The motion was 

denied   and   Rice   appealed   to   the   Disciplinary  Board.     His   opening   brief   before   the 

Disciplinary Board did not raise a due process argument.  In fact Rice did not, at any of 

these stages, even hint at due process concerns arising out of the Hearing Committee 

proceedings.      His due process claims appeared for the first time in his opposition brief 

to the Disciplinary Board, filed on January 8, 2010.               Because that briefing schedule 

called for simultaneously filed opposition briefs, Rice's due process argument was first 

raised at a time when the Bar had no opportunity to respond.  We conclude that raising 

due   process   claims   at   this   late   stage,   after   the   Bar   had   filed   its   final   brief   to   the 
Disciplinary Board, was not sufficient to preserve Rice's due process argument.11 

        11      Rice also claims that the Hearing Committee "converted" the Bar's status 

report into a dispositive motion without giving notice that it was doing so.  He contends 
this was impermissible by analogy to this court's rulings on conversion of a 12(b)(6) 
motion to a motion for summary judgment.  We disagree with this characterization.  The 
Hearing Committee had stated in its earlier summary judgment decision that the issues 
raised under ARPC 1.15 would be "ripe for decision after the evidentiary hearing" thus 
providing notice that it would be prepared to rule on the issue.  The Hearing Committee 
had already received extensive documentary evidence and heard a day of testimony. 
                                                                                         (continued...) 

                                                  -17-                                               6592 

----------------------- Page 18-----------------------

                Rice's attorney acknowledged to the Disciplinary Board that due process 

was a "new issue," first raised in his opposition brief.  But he argues that the due process 

argument was not waived because the Hearing Committee's actions constituted plain 

       12 
error.    We acknowledge it would have simplified matters if the Hearing Committee had 

issued explicit notice that unless Rice requested a hearing, it would go forward and 

consider the merits of the Bar's position.           But we hold that the Hearing Committee's 

instructions were adequate.   Further, the Disciplinary Board allowed Rice to submit any 

additional evidentiary support or testimony he wished to have considered.                      Any due 

process violation at the Hearing Committee level was waived - and rendered harmless 

by the additional due process offered by the Board. 

                3.       The Disciplinary Board did not deny Rice due process. 

                We find that Rice waived any due process claim he may have had, but we 

also observe that the Disciplinary Board's order allowing Rice to submit additional 

documents and testimony was likely sufficient to cure the due process violation Rice 
alleges.13     Rice   argues   that   the   Board's   decision   to   take   additional   evidence   was   a 

        11(...continued) 

Seen in this light, the Hearing Committee's ultimate ruling was not a grant of summary 
judgment, but rather a decision following an evidentiary hearing consisting of Rice's 
testimony, earlier-submitted evidence, and the supplemental evidence cited in the Bar's 
status report; there was no "conversion" requiring additional notice to Rice. 

        12      Evron v. Gilo, 777 P.2d 182, 186 (Alaska 1989) (citing In re L.A.M., 727 

P.2d   1057,   1059   (Alaska   1986))   (arguments   not   raised   before   trial   court   generally 
considered waived on appeal, but "[t]hat rule is limited by the doctrine of plain error 
which allows consideration of points not raised at the trial level if the judicial action was 
obviously erroneous . . . ."); see also Yost v. State, Div. of Corps., Bus. and Prof'l 
Licensing, 234 P.3d 1264, 1275 n.40 (Alaska 2010). 

        13      See   City   of   N.   Pole   v.   Zabek,   934   P.2d   1292,   1298-99   (Alaska   1997)
 

(holding that a "post-hearing supplementation of the record with witness affidavits"
 
                                                                                         (continued...)
 

                                                  -18-                                               6592 

----------------------- Page 19-----------------------

separate due process violation because the Board's role should be limited to reviewing 

the   work   of   the   Hearing   Committee.     Contrary   to   Rice's   argument   that   the   Board 

"abandoned its appellate function" by taking evidence, Bar Rule 10(c) gives the Board 

power      to  "review     and   modify     the   findings    of  fact,   conclusions     of   law,   and 
recommendations of Hearing Committees."14  Further, though Rice contends on appeal 

that the Board's decision to accept additional evidence denied his right to appellate 

review, the record shows the Board gave written notice of its decision to accept whatever 

additional evidence Rice wished to have considered, and Rice did not object. 

                Rice makes two additional claims that the Disciplinary Board violated due 

process.   First, he argues that the Board improperly "changed its composition by adding 

two members at the second hearing who had not been present at its first session."  Rice 

relies on "analogous authority" requiring the parties' consent to changes in the jury panel 

during a trial.   But this analogy is inappropriate.  Members of the Board, like members 

of an appellate court, may independently review both the record below and any segments 

of the Board proceedings that they may have missed.  The record shows that two Board 

members who were not present at Rice's first hearing stated they had read the transcript 

of the earlier Board hearing. 

                Rice also objects to the part of the Board's sanctions order providing for a 

one-year   stay   of   suspension   on   the   condition   that   Rice   inform   past   clients   of   his 

discipline and encourage them to inform the Bar if they believe their trust funds were 

improperly applied or refunded. Rice contends that this provision "reverses the burdens" 

        13(...continued) 

cured earlier due process violation);McMillan v. Anchorage Cmty. Hosp., 646 P.2d 857, 
866-67 (Alaska 1982). 

        14      Alaska Bar R. 10(c)(5); see also In re Brion, 212 P.3d 748, 754-55 (Alaska 

2009) (holding that although "[t]his was an oral argument, not an evidentiary hearing," 
the Board's questions during oral argument were "appropriate to the setting"). 

                                                  -19-                                             6592
 

----------------------- Page 20-----------------------

by requiring Rice to "prove that he has not violated the Rules of Professional Conduct," 

rather than requiring the Bar to prove the opposite by clear and convincing evidence. 

This argument is unconvincing.         The Bar was required to prove Rice's misconduct by 

clear and convincing evidence in order to trigger sanctions in the first place, and the 

condition     -   which    provides    Rice   the  opportunity    to  decrease    the  length   of  his 

suspension - is entirely optional.           Rice has not shown that the discipline condition 

recommended by the Hearing Committee and adopted by the Board denied him due 

process. 

        B.	     The Disciplinary Board Imposed An Appropriate Sanction On Rice. 

                We apply our independent judgment when determining appropriate attorney 
sanctions.15   In this case, independent review leads us to agree with the Disciplinary 

Board recommendation that Rice be subject to a four-year suspension, with one year 

conditionally stayed.       This conclusion is consistent with both the ABA Standards for 

Imposing Lawyer Sanctions and our own precedent. 

                1.	     The ABA Standards for Imposing Lawyer Sanctions support 
                        Rice's suspension. 

                The   American   Bar   Association   has   developed   standards   for   imposing 
lawyer   sanctions,   by   which   we   are   guided   but   "not   constrained."16  Under   the   ABA 

model, a court imposing sanctions must consider four factors:  (1) the duty breached by 

the attorney; (2) the attorney's mental state; (3) the injury caused by the attorney's 
actions; and (4) aggravating and mitigating factors.17           The initial determination of the 

appropriate sanction is made after the court addresses the first three factors.             After its 

        15      In re West, 805 P.2d 351, 353 n.3 (Alaska 1991). 

        16      In re Frost, 863 P.2d 843, 854 (Alaska 1993); see also In re Buckalew, 731 

P.2d 48, 51-52 (Alaska 1986). 

        17      ABA Standards, Theoretical Framework. 

                                                 -20-	                                          6592
 

----------------------- Page 21-----------------------

initial sanction determination, the court considers aggravating and mitigating factors to 

determine whether the sanction should be increased or decreased according to specific 
circumstances.18 

                        a.      Duty 

                Rice's trust accounting violations breached his duty to clients under ABA 

Standard   4.1,   Failure   to   Preserve   the   Client's   Property.     In   addition,   Rice's   trust 

accounting violations breached his duty to the public under ABA Standard 5.1, Failure 

to Maintain Personal Integrity. The latter provision covers "cases involving commission 

of    a   criminal     act   that   reflects    adversely     on    the   lawyer's     honesty     [and] 

trustworthiness . . . or in cases with  conduct involving dishonesty, fraud, deceit, or 

misrepresentation."        Rice   emphasizes   that   he   was   "not   found   by   the   Area   Hearing 

Committee to have engaged in either felonious or dishonest conduct."  But the Hearing 

Committee's finding that Rice "knowingly . . . misappropriated client funds" by making 

uninvoiced   payments   to   himself   implies  conduct   that   violates   the   duty   to   maintain 

personal integrity, even though the Hearing Committee did not find criminal conduct. 

                By failing to produce records in cooperation with the Bar's investigation, 

Rice violated Alaska Bar Rule 15(a)(4).   He breached his duty to the legal system under 

ABA Standard 6.2, Abuse of the Legal Process, which covers "cases involving failure 

to expedite litigation or bring a meritorious claim, or failure to obey any obligation under 

the rules of a tribunal." 

                        b.      Mental state 

        18      ABA Standard 9.0.          Aggravating factors set out in the ABA Standards 

include     prior   disciplinary    offenses,   selfish   motive,    multiple    offenses,    bad   faith 
obstruction of the disciplinary proceeding, substantial experience in the practice of law, 
and illegal conduct, among others.  Id.         Mitigating factors include the absence of prior 
offenses,   personal   or   emotional   problems,   cooperation   with   the   disciplinary   board, 
character or reputation, and remorse.  Id. 

                                                  -21-                                            6592
 

----------------------- Page 22-----------------------

                The ABA Standards model assumes three possible mental states:                    intent 

("when the lawyer acts with the conscious objective or purpose to accomplish a particular 

result"), knowledge ("when the lawyer acts with conscious awareness of the nature or 

attendant circumstances of his or her conduct both without the conscious objective or 

purpose to accomplish a particular result"), and negligence ("when a lawyer fails to be 

aware of a substantial risk that circumstances exist or that a result will follow, which 

failure is a deviation from the standard of care that a reasonable lawyer would exercise 
in that situation").19  The Hearing Committee found that Rice acted "knowingly" (albeit 

not necessarily with the intent to deprive his clients of property) by commingling and 

misappropriating client funds and by failing to keep adequate records.  The Disciplinary 

Board implicitly adopted these findings of fact when it adopted the Hearing Committee's 

recommendations.        Rice   has   not   met   his   burden   of   demonstrating   that   the   Hearing 
Committee's findings were incorrect.20 

                The   Hearing   Committee   further   found   that   Rice   "willfully"   failed   to 

cooperate with the Bar's investigation, thus imputing intent to Rice's behavior. Rice has 

failed to discredit this finding.     As discussed, the primary explanation Rice offered for 

his failure to submit subpoenaed documents, i.e., that he had pending motions to quash 

the Bar's subpoena and for a protective order, is unavailing.  For several months before 

        19      ABA Standards, Theoretical Framework. 

        20      As   noted   above,   "[w]here   findings   of   fact   entered   by   the   Board   are 

challenged on appeal to this court, . . . the respondent attorney bears the burden of proof 
in demonstrating that such findings are erroneous." In re West, 805 P.2d at 353 n.3. Rice 
admitted to knowingly commingling funds, acknowledging that he "always kept some 
funds of [his] own in the client trust account."  He failed to provide any evidence of his 
claim that he properly invoiced all withdrawals and has offered no arguments on appeal 
to   challenge     the  Board's    finding    of knowing       misappropriation,      other   than   the 
unsupported contention that the absence of client complaints implies no misappropriation 
occurred. 

                                                 -22-                                            6592
 

----------------------- Page 23-----------------------

Rice filed these motions, he knew of the subpoena and he was aware that the CD had 

arrived broken at the Bar's office.         Yet he still failed to respond to the Bar's request. 

This ongoing refusal to comply with the Bar's unambiguous request supports the finding 

that Rice acted with intent when he failed to cooperate. 

                         c.      Injury 

                Under the ABA Standards, "[t]he extent of the injury is defined by the type 
of   duty   violated   and   the   extent   of   actual   or   potential   harm."21  Rice   emphasizes 

repeatedly in his briefing that he was not found to have caused financial loss to any client 

and that the potential harm to clients posed by his trust accounting practices was limited 

by his "careful safeguarding of funds so that at all times he held the funds necessary to 

meet   all   of   his   fiduciary   obligations." But,   as   the   Hearing   Committee   noted   in   its 

findings   and   conclusions,   Rice's   ability   to   cover   his   obligations   relied   in   part   on   a 

mistaken view of trust funds as fungible assets, such that one client's funds could be used 

to pay another client. Moreover, the Hearing Committee determined that Rice may have 

simply been "very lucky in being able to manipulate account balances to cover his need 

to provide funds," masking a high potential for harm to his clients.                We have held that 

"the public suffers injury whenever a lawyer fails to maintain personal integrity by 
improperly handling funds held in trust."22 

                We   agree   with   Bar   Counsel   that   Rice's   violation   of   Alaska   Bar   Rule 

15(a)(4) delayed an accounting, causing potential harm to clients whose money was 

exposed to mismanagement for a longer period of time, and harmed "the reputation of 

the legal profession for integrity, competence, and effective self-regulation." 

                         d.      Initial sanction determination 

        21      ABA Standards, Theoretical Framework. 

        22      In re Friedman, 23 P.3d 620, 631 (Alaska 2001). 

                                                  -23-                                                6592 

----------------------- Page 24-----------------------

                ABA Standard 6.21 provides that disbarment is appropriate "when a lawyer 

knowingly violates a court order or rule with the intent to obtain a benefit for the lawyer 

or another, and causes serious injury or potentially serious injury to a party or causes 

serious or potentially serious interference with a legal proceeding." By failing to respond 

to the Bar's subpoena, Rice intended to obtain the "benefit" of delaying and impeding 

the Bar's investigation; his delay - which arguably lasted from the time of the Bar's 

initial records request up through the present, given his continuing failure to produce 

some of the requested information - caused serious interference with the investigation 

and the formal proceedings that followed from it.  Disbarment is therefore a permissible 

sanction under ABA Standard 6.21. 

                Under ABA Standard 4.12, "[s]uspension is generally appropriate when a 

lawyer knows or should know he is dealing improperly with client property and causes 

injury or potential injury to a client."       Rice's actions caused at least potential injury to 

his clients.   It also appears that, consistent with the Hearing Committee's findings, his 

misappropriation of client property was "knowing"; Rice knowingly paid himself out of 

client trust funds without having properly invoiced clients for services (regardless of 

whether he believed he had earned the payments), thus violating his fiduciary duties. The 

initial sanction indicated under ABA Standard 4.12 is suspension. 

                        e.     Aggravating and mitigating factors 

                Rice argues that a number of the issues the Bar considers to be aggravators 

are actually mitigators.  For example, he claims he cooperated with the Bar and that his 

"cooperation   in   providing   the   documents used   to   convict   him   should   actually   be   a 

mitigator."    He also argues that the Hearing Committee should have considered as a 

mitigator the fact that none of his clients was harmed or even complained.                We do not 

find these arguments convincing.          As noted above, the fact that the documents Rice 

provided were used to establish the Bar's case against him does not excuse his failure to 

                                                 -24-                                           6592
 

----------------------- Page 25-----------------------

provide other documents requested by the Bar and to otherwise cooperate with the Bar's 

investigation.      The   fact   that   no   client   was   shown   to   suffer   a   financial   loss   is   not   a 

mitigating factor; potential harm is sufficient to trigger even the most severe sanctions 
under the ABA model.23         Further, the lack of client complaints only establishes that no 

client was aware of any misconduct on Rice's part. 

                 The Bar, meanwhile, argues that "[p]ractically every aggravator listed in 

ABA Standards . . . 9.22(a)-(k) applies to Rice."                Specifically, the Bar cites what it 

characterizes as Rice's dishonest and selfish motives, repeat and multiple offenses, bad 

faith obstruction of the discipline process, false and deceptive conduct, lack of remorse, 

exploitation of vulnerable clients, substantial legal experience, and potential criminal 

conduct.     The Bar contends that Rice's only mitigating factor is his lack of a prior 

discipline record.       We judge this assessment to be too harsh.           Rice engaged in repeat 

offenses and obstructed the discipline process; he does have substantial legal experience 

and has exhibited no remorse. But his trust accounting misconduct, although "knowing" 

and potentially harmful, does not seem to have had the bad intent which the Bar attributes 

to it.   Nothing in the record indicates that he had "dishonest and selfish motives" beyond 

an   unwillingness   to   comply   with   accounting   requirements,   or   that   he   engaged   in 

"deceptive conduct" (except to the extent that taking client payments without proper 

documentation is intrinsically "deceptive").  Admittedly, there is also little in the record 

to definitively exclude less benign interpretations of Rice's behavior, but the Bar has the 

burden of demonstrating its initial charges  against a respondent attorney.                   Thus, we 

exclude   these   factors   from   the   applicable  aggravators   in   evaluating   the   appropriate 

sanction for Rice's conduct. 

        23       See, e.g., ABA Standard 4.11 (providing that "[d]isbarment is generally 

appropriate when a lawyer knowingly converts client property and causes injury or 
potential injury to a client") (emphasis added). 

                                                   -25-                                               6592 

----------------------- Page 26-----------------------

                The   ABA   Standards   do   not   provide   guidance   on   how   mitigating   and 
aggravating factors are to be weighted in determining sanctions.24  In the absence of such 

guidance, we are inclined to place a great deal of weight on the absence of dishonest and 

selfish motives, which seems to distinguish Rice's conduct from more serious offenses 

such   as   the   deliberate   and   calculated   theft  of   client   funds. Rice's   conduct   is   more 

accurately summarized as irresponsible accounting and estimated, uninvoiced (but, in 

Rice's view, not unearned) payments to himself.             The absence of dishonest and selfish 

motive, combined with the fact that Rice has no prior disciplinary offenses, is sufficient 

to reduce his punishment from the disbarment indicated under ABA Standard 6.2 to 

suspension.       The   appropriate   period   of   suspension   is   further   analyzed   below,   with 

reference to our precedent for attorney discipline. 

                2.	     Alaska       case    law    supports      the   recommended          four-year 
                        suspension. 

                We have previously issued holdings in a number of cases dealing with client 

trust fund misconduct by attorneys.         In order to provide context for the unique facts of 

this case, we focus here on five cases representing the spectrum of offenses and sanctions 

in the trust fund misconduct category. 

                In In re Mann, an attorney misappropriated $2,001 obtained on a referral 

collection for the benefit of another law firm and used the money to make mortgage 
payments on his home.25         He subsequently turned himself in (resulting in a criminal 

conviction   for   misapplication   of   property),   returned   the   misappropriated   funds,   and 

        24      See In re Buckalew, 731 P.2d 48, 54 (Alaska 1986) ("There is no 'magic 

formula' to determine which or how many mitigating circumstances justify the reduction 
of an otherwise appropriate sanction.  Each case presents different circumstances which 
must be weighed against the nature and gravity of the lawyer's misconduct."). 

        25      In re Mann, 853 P.2d 1115, 1116 (Alaska 1993). 

                                                  -26-	                                           6592
 

----------------------- Page 27-----------------------

publicly informed the community of his misconduct.26            We noted that disbarment would 

typically be the appropriate sanction for Mann's conduct, but held that mitigating factors, 

chiefly   Mann's   voluntary   disclosure,   restoration   of   the   misappropriated   funds,   and 
remorse, reduced the appropriate sanction to a three-year suspension.27 

                InIn re Friedman, an attorney deposited an $81,000 settlement contribution 

in his client trust account.      Without permission from the other plaintiffs' attorneys, he 

then drew on the account to advance funds to his client and pay himself attorney's fees 

in the case that were not yet due.   He also later drew on the trust account to pay himself 

fees in the unrelated matters of five other claimants before he had deposited settlement 
funds in those matters.28     We held that Friedman had engaged in misconduct including 

"dishonest conduct"29 and "illegal conduct involving moral turpitude,"30 violations that 

called   for   disbarment,   absent   mitigating  factors.31    Taking   mitigators   into   account, 

however, we found that Friedman's misconduct was similar to Mann's and that a similar 

three-year suspension period was therefore appropriate.  We noted that Mann had taken 

less money than Friedman and had self-reported, but cited several circumstances that 

convinced us a longer suspension would be too harsh:               "(1) Friedman's lack of a prior 

disciplinary record; (2) the absence of loss or injury to his clients; (3) his undisputed 

        26      Id. 

        27      Id. at 1119-20.    This court noted, "Although we do not condone Mann's 

misappropriation of funds, we commend his voluntary disclosure and genuine regret." 
Id. at 1120. 

        28      In re Friedman, 23 P.3d 620, 623 (Alaska 2001). 

        29      Id. at 625-27. 

        30      Id. at 629.   We noted, "Friedman's conduct, if committed in Alaska, would 

have violated AS 11.46.620(a) and would have been a Class C felony."  Id. at 632. 

        31      Id. at 631. 

                                                 -27-                                           6592
 

----------------------- Page 28-----------------------

dedication to his clients and outstanding commitment to pro bono and public service; and 

(4) the significant measures that Friedman took to remedy the problems caused by his 
conduct."32 

                 In In re Brion, an attorney was charged with misconduct relating to failure 

to   perform   client   services   with   reasonable   diligence   and   promptness   and   failure   to 
communicate with clients regarding legal matters and fees.33  Bar Counsel also charged 

him with failing to account properly for client funds; Brion overdrew a trust account on 

one occasion and "misrepresented the source of the money he deposited in the trust 
account to correct the overdraft."34         We applied the ABA sanctions standards for cases 

involving lack of diligence and found that suspension was the appropriate sanction; based 

on the aggravating factors in the case (including multiple offenses, the vulnerability of 

Brion's out-of-state clients, and Brion's substantial legal experience), we imposed a 
three-year suspension, with two of those years stayed.35 

                 In In re Stepovich, Bar Counsel determined that an attorney had "failed to 

maintain sufficient funds in his operating account to cover shortages in his trust account 

throughout . . . 1996-2003"; on one occasion, Stepovich waited five months to disburse 

settlement   monies   to   a   client,   then   wrote   the   client   a   check   that   was   returned   for 
insufficient     funds.36      The      Disciplinary      Board     found    that    this   amounted      to 

        32      Id. at 634. 

        33      In re Brion, 212 P.3d 748, 750 (Alaska 2009). 

        34      Id. 

        35      Id. at 752. 

        36      In re Stepovich, 143 P.3d 963, 964 (Alaska 2006) (Fabe, J., dissenting). 

                                                   -28-                                                 6592 

----------------------- Page 29-----------------------

misappropriation of client funds.37        We imposed a three-year suspension, with one year 

stayed.38 

                In In re Buckalew, an attorney embezzled $67,000 from two client trust 
accounts in order to pay clients in another matter that he falsely claimed to have settled.39 

We held that "Buckalew's misconduct included defrauding a client by fabricating a 

'settlement agreement' and intentionally representing the same as genuine, abuse of the 

legal process by forging a judge's signature, and the embezzlement of client funds, in 
violation of state and federal law"40 and that the ABA Standards would generally require 

disbarment for such misconduct.41          Although the Disciplinary Board had recommended 

a   five-year   suspension   based   on   mitigating   factors,   we   determined   that   the   relevant 

mitigators (including the fact that Buckalew had no prior record of misconduct and had 

turned himself in only after his misconduct was discovered by a colleague) were not 
sufficient to preclude disbarment in light of "the severity of Buckalew's misconduct."42 

                Both parties devote extensive portions of their briefs to identifying the 

points of similarity and distinction between these cases and Rice's.                  Rice argues that 

Friedman,      Stepovich,  Mann,        and  Brion     are  distinguishable      on   various   grounds: 

        37      Id. 

        38      Id. at 963-64. 

        39      In re Buckalew, 731 P.2d 48, 49 (Alaska 1986). 

        40      Id. at 53. 

        41      Id. at 54. 

        42      Id.    at  54-55.   Because      Buckalew      would    be   eligible   for  conditional 

readmission   to   the   bar   after   five   years   of   disbarment,   the   disbarment   sanction   was 
functionally the same as the five-year suspension recommended by the Bar and consented 
to   by   Buckalew.     However,   this   court   noted   that   the   "more   severe   connotation"   of 
"disbarment" made it appropriate to the situation.  Id. at 55-56. 

                                                   -29-                                             6592
 

----------------------- Page 30-----------------------

Friedman was found to have engaged in illegal activities, Stepovich was found to have 

harmed a client, Mann took client trust funds that he had not earned, and Brion (who 

received   a   relatively   lenient   sanction)   was   cited   for   lack   of  diligence   and   failure   to 

communicate with his clients as well as for trust fund violations.  We do not find these 

points of distinction particularly compelling. It is true that, unlikeFriedman, the Hearing 

Committee in this case did not explicitly find that Rice had engaged in illegal activities, 

but it did find that Rice had "misappropriated client funds."  Rice may not have caused 

actual harm to clients as he argues Stepovich did, but he did cause them potential harm, 
which is sufficient under the ABA Standards to justify even the harshest sanctions;43 and 

he did arguably cause actual harm to public trust in the legal system.  Based on the Bar's 

analysis of Rice's records, the Hearing Committee concluded that Rice, like Mann, 

appeared to have paid himself funds he had not yet earned; Rice provided no evidence 

of client invoicing to challenge this conclusion. And although Rice was not cited for lack 

of diligence as Brion was, his trust account misconduct appears to have been more 

extensive than Brion's single trust account overdraft. Moreover, unlike Friedman, Mann, 

or Stepovich, Rice failed to cooperate with the Bar's investigation in addition to his trust 

accounting misconduct. 

                The Bar emphasizes that there were mitigating factors in the cited cases that 

are   not   present   in   Rice's   case.  For   example,   it   notes   that   Mann's   misconduct   was 

"isolated compared to Rice's" and that Mann, unlike Rice, turned himself in.  Similarly, 

the Bar argues that, "[u]nlike Friedman, Rice cannot show that he harmed no client . . . 

[,] has no record of dedication to clients or public service . . . [,] tried to conceal his 

problems and blamed the Bar, and . . . still denies misconduct."  The Bar contends that 

Rice's conduct was closest to Buckalew's insofar as each attorney "misappropriated large 

        43      See, e.g., ABA Standard 4.11. 

                                                  -30-                                                6592 

----------------------- Page 31-----------------------

sums,   over   a   long   time,   and   tried   to   conceal   it,"   "offend[ing]   public   trust"   by   his 

misconduct.  While we agree that Rice lacked a number of the mitigating factors present 

in Mann and Friedman, the Bar's comparison to Buckalew is misplaced.                          Buckalew 

misapplied a large sum of money as part of a larger scheme to deceive clients into 

accepting a fabricated settlement agreement.            Rice's misappropriations and overdraws 

appear to have been, at least in part, the result of irresponsible accounting and invoicing 

practices, and were not accompanied by additional attempts to mislead his clients. 

                Based on our analysis of the relevant case law, we hold that the four-year 

suspension      recommended        by   the  Disciplinary     Board    is  appropriate.    Rice's     trust 

accounting misconduct was probably most similar to that of Friedman and Stepovich; in 

all three cases, attorneys withdrew funds from client trust accounts in advance of having 

earned - or at least properly invoiced - them, but they do not appear to have intended 

to permanently deprive clients of money.            Friedman received a three-year suspension, 

while Stepovich received a three-year suspension with one year stayed.  Like Friedman, 

Rice    had   no   record   of  prior   misconduct.      But    unlike   Friedman,     who    introduced 

substantial evidence of his public service andthe quality of his work, there is no evidence 

in the record of Rice's prior history of service to clients.  More importantly, Rice, unlike 

either Friedman or Stepovich, was found to have deliberately interfered with the Bar's 

investigation.   This lack of cooperation, constituting an independent violation under the 

ABA Standards, merits additional disciplinary action. A suspension that is a year longer 

than    the  discipline    imposed     on  Friedman      is  therefore   reasonable    in  Rice's    case, 

particularly     given    the  possibility    of  a  one-year     stay  should    Rice    fulfill  certain 
conditions.44 

        44      Rice makes much of the fact that, under the ABA Standards, "suspension 

should be for a period of time equal to or greater than six months, but in no event should 
                                                                                          (continued...) 

                                                   -31-                                               6592 

----------------------- Page 32-----------------------

V.      CONCLUSION 

                For the reasons discussed above, we agree with the findings, conclusions, 

and recommendation on sanctions made by the Hearing Committee and adopted by the 

Disciplinary Board. 

        44(...continued) 

the   time   period   prior   to   application   for  reinstatement   be   more   than   three   years." 
ABA Standard 2.3.   Thus, he argues, "the outside sanction, short of disbarment, should 
be   a   suspension   of   no   greater   than   three   years." As   noted,   we   are   guided   but   not 
constrained by the ABA Standards; past cases such as Buckalew reflect our practice of 
at least contemplating the imposition of sanctions longer than three years despite the 
ABA Standards' guidelines.  Buckalew, 731 P.2d at 48. 

                                                 -32-                                              6592 
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