Louisiana State Bar Ass'n v. Shaheen

338 So. 2d 1347
CourtSupreme Court of Louisiana
DecidedNovember 17, 1976
Docket55432
StatusPublished
Cited by22 cases

This text of 338 So. 2d 1347 (Louisiana State Bar Ass'n v. Shaheen) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Louisiana State Bar Ass'n v. Shaheen, 338 So. 2d 1347 (La. 1976).

Opinion

338 So.2d 1347 (1976)

LOUISIANA STATE BAR ASSOCIATION
v.
Philip J. SHAHEEN, Jr.

No. 55432.

Supreme Court of Louisiana.

September 13, 1976.
Rehearing Denied November 5, 1976.
Dissenting Opinion November 17, 1976.

*1348 Henry A. Politz, Chairman, Shreveport, Wood Brown, III, New Orleans, Sam J. D'Amico, Baton Rouge (Recused), Leonard Fuhrer, Alexandria, Harold J. Lamy, New Orleans, Edgar H. Lancaster, Jr., Tallulah, John F. Pugh, Thibodaux, A. Russell Roberts, Metairie, John B. Scofield, Lake Charles, Thomas O. Collins, Jr., New Orleans, Counsel, Louisiana State Bar Ass'n, Committee on Professional Responsibility, for plaintiff-petitioner.

Alfred A. Mansour, Alexandria, for defendant-respondent.

DIXON, Justice.

The Louisiana State Bar Association, through its Committee on Professional Responsibility, instituted this disbarment proceeding against Philip J. Shaheen, Jr.; the basis was Shaheen's conviction in federal court of mail fraud and conspiracy. A hearing was held before John Dale Powers, appointed commissioner by this court. The commissioner found that the conviction evidences both a lack of honesty and trustworthiness and represents a serious crime. Disbarment was deemed an appropriate disciplinary action.

On December 18, 1970 a federal jury convicted Philip J. Shaheen, Jr. of three counts of conspiracy and mail fraud, in violation of *1349 18 U.S.C., §§ 371[1] and 1341.[2] This conviction was affirmed by the United States Fifth Circuit Court of Appeals sub nom. United States v. Perez, 489 F.2d 51 (1973). Rehearing and rehearing en banc were denied on January 2, 1974. The United States Supreme Court denied Shaheen's application for a writ of certiorari on June 10, 1974.

This conviction grew out of a scheme, involving several lawyers and doctors, to defraud insurance companies by staging fake accidents, after which the allegedly injured participants in the accidents would retain lawyers to represent them in their claims. Chief Judge John Brown of the Fifth Circuit described the scheme as follows:

"The facts of this case, in a purely legalistic sense, need no embellishment in a literary sense to classify this as a piece of prose that could well be called a second `American tragedy.' It would be an American tragedy, not only because the events took place here, but because it is just another instance in which large numbers of Americans get willingly involved in enterprises which reflect a lack of compunction, possibly even a proclivity, to enter into the proverbial `get-rich-quick scheme' evidencing not only a disregard for law but, sadly, also a deafness to conscience. As we undertake our profound but prosaic role of adjudicating these cases, what we see is not pleasant. It reveals a wreckage of promising professional careers, evidence of deliberate and unabashed attempts to prey upon financially pressed expectant mothers for gain and the seemingly all too eager participation by a large cast of characters in a patently illegal undertaking.

The Scheme

A recital of the facts must precede resolution of the issues raised on appeal. The Louisiana-wide get-rich-quick scheme involved the staging of fraudulent automobile accidents for the purpose of creating false personal injury claims. These claims would be submitted to the insurance carriers for the respective vehicles involved in the wrecks with the aid and contrivance of certain physicians and lawyers.
As the scheme evolved, the participants even coined their own terminology which, though alien to the unintiated, became known to all those who participated. This glossary of modern day crookedness was quite descriptive. Certain participants were known as `recruiters'. The recruiters function, not unnaturally, was to recruit others who assumed titles commensurate with their organizational function. There were the `hitters', whose function it was to drive the `hitter' vehicle in each collision which supposedly was to be liable for causing the accident. Then there was the `target' vehicles. The occupants of the `target' were known as *1350 the `driver' and the `riders'. It was determined at the outset that pregnant women made exceptionally good riders as they could claim pregnancy related injuries which would be both hard to disprove and easily settleable with the insurance carriers. Throughout the scheme there was an effort made on the part of the participants to use vehicles and drivers which were covered by high limits of liability insurance.
According to a pre-arranged timetable, the `hitter' vehicle would strike the `target' vehicle either broadside or in the rear end. The occupants of the `target' vehicle—the driver and riders—and occasionally some of those in the `hitter' vehicle, feigning injuries, would be sent to a particular doctor and lawyer who would facilitate phony claims by creating a medical history for treatment of non-existent injuries and making a demand on the appropriate insurance company.
The key to immediate financial gain in each staged collision was advances paid by the attorneys to the `riders' for whom allegedly false claims were being submitted. These advances were paid in the form either of cash payments or loans from local financial institutions, co-signed by the attorney handling the claim. Of the usual advance ranging from $250 to $500, part was retained by the rider-claimant with the rest being distributed among the organizers, recruiters, and others who assisted with various aspects of staging the wreck. When the claim was ultimately settled with the insurance carrier, the proceeds would be applied to (i) repay the advancing attorney or in such cases, to liquidate the guaranteed bank loan and (ii) to pay the inflated doctor's bill, not infrequently, with kickbacks going to both the organizers and the participating attorneys in addition to their usual shares." U. S. v. Perez, 489 F.2d 51, 54-55. (Footnotes omitted).

Several objections to the commissioner's findings of fact and conclusions of law have been raised by respondent, who first contends that this proceeding is premature because his conviction is not yet final, there being an appeal presently pending in the Fifth Circuit from a ruling by a federal district judge that denied his motion for a new trial.

Article XV, § 8, paragraph 7 of the Articles of Incorporation of the Louisiana State Bar Association, under which this proceeding was brought, provides:

"(7) After the conviction has become final, that is, all appeals have been concluded or exhausted, the procedure shall be as follows:
(a) The Committee will file a petition in the Supreme Court seeking disbarment or any other remedy that the Committee deems appropriate, and the petition will be served upon the respondent in the same manner as in ordinary proceedings.
(b) When issue is joined by answer by the respondent, a Commissioner will be appointed by the Supreme Court to represent the Court in the same manner as in ordinary proceedings.
(c) At the hearing before the Commissioner, the certificate of the conviction of the respondent shall be conclusive evidence of his guilt of the crime for which he has been convicted.

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