Office of Lawyer Regulation v. Thomas W. Batterman

2023 WI 13, 985 N.W.2d 779, 406 Wis. 2d 14

• Court: Wisconsin Supreme Court
• Decided: February 24, 2023
• Docket: 2022AP001213-D
• Status: Published

Opinion

2023 WI 13

SUPREME COURT OF WISCONSIN CASE NO.: 2022AP1213-D

COMPLETE TITLE: In the Matter of Disciplinary Proceedings Against Thomas W. Batterman, Attorney at Law:

Office of Lawyer Regulation, Complainant, v. Thomas W. Batterman, Respondent.

DISCIPLINARY PROCEEDINGS AGAINST BATTERMAN

OPINION FILED: February 24, 2023 SUBMITTED ON BRIEFS: ORAL ARGUMENT:

SOURCE OF APPEAL: COURT: COUNTY: JUDGE:

JUSTICES: Per curiam. ZIEGLER, C.J., filed a concurring opinion in which REBECCA GRASSL BRADLEY, HAGEDORN, and KAROFSKY, JJ., joined. NOT PARTICIPATING:

ATTORNEYS: 2023 WI 13 NOTICE This opinion is subject to further editing and modification. The final version will appear in the bound volume of the official reports. No. 2022AP1213-D

STATE OF WISCONSIN : IN SUPREME COURT

In the Matter of Disciplinary Proceedings Against

Thomas W. Batterman, Attorney at Law:

FILED Office of Lawyer Regulation, FEB 24, 2023 Complainant, Sheila T. Reiff v. Clerk of Supreme Court

Thomas W. Batterman,

Respondent.

ATTORNEY disciplinary proceeding. Attorney's license

revoked.

¶1 PER CURIAM. Attorney Thomas W. Batterman has filed a

petition for the consensual revocation of his license to

practice law in Wisconsin pursuant to Supreme Court Rule (SCR)

22.19.1 In his petition, Attorney Batterman states that he

1 SCR 22.19 provides: No. 2022AP1213-D

cannot successfully defend against the allegations of misconduct

in connection with a grievance investigated by the Office of

Lawyer Regulation (OLR).

¶2 Attorney Batterman was admitted to practice law in

Wisconsin in 1982. His license is currently active and in good

standing. He has not practiced law since 1985, does not

(1) An attorney who is subject of an investigation for possible misconduct or the respondent in a proceeding may file with the supreme court a petition for the revocation by consent [of] his or her license to practice law.

(2) The petition shall state that the petitioner cannot successfully defend against the allegations of misconduct.

(3) If a complaint has not been filed, the petition shall be filed in the supreme court and shall include the director’s summary of the misconduct allegations being investigated. Within 20 days after the date of filing of the petition, the director shall file in the supreme court a recommendation on the petition. Upon a showing of good cause, the supreme court may extend the time for filing a recommendation.

(4) If a complaint has been filed, the petition shall be filed in the supreme court and served on the director and on the referee to whom the proceeding has been assigned. Within 20 days after the filing of the petition, the director shall file in the supreme court a response in support of or in opposition to the petition and serve a copy on the referee. Upon a showing of good cause, the supreme court may extend the time for filing a response. The referee shall file a report and recommendation on the petition in the supreme court within 30 days after receipt of the director's response.

(5) The supreme court shall grant the petition and revoke the petitioner's license to practice law or deny the petition and remand the matter to the director or to the referee for further proceedings.

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maintain a law office and has no clients, and has no intention

to practice law in the future. He has no previous disciplinary

history.

¶3 On July 19, 2022, OLR filed a complaint against

Attorney Batterman alleging four counts of misconduct. The

first two counts of misconduct arose out of Attorney Batterman’s

representation of J.G.

¶4 Attorney Batterman is the founder, registered agent,

and principal of Financial Fiduciaries and the president and

majority shareholder of WTC, Inc. (WTC), the sole member of

Financial Fiduciaries. In April 1988, J.G. established and

funded a revocable living trust which provided that if J.G.’s

wife should predecease him, the assets remaining in the trust,

together with any assets received into the trust, shall be

distributed to the following charities: 25% to the Diocese of

the Catholic Church for Superior, Wisconsin, for educational

purposes; 25% to Bruce High School, Bruce, Wisconsin, to fund

scholarships for students pursuing a college education; 25% to the Alzheimer’s Association for research; and 25% to the

American Cancer Society for research.

¶5 In March 2011, J.G. amended the trust to provide that

the bequest to the American Cancer Society be paid through local

fundraising events such as Relay for Life in a manner and for

such purposes as the organization saw fit. The amendment also

changed the successor trustee from Vigil Asset Management Group,

Inc. to Vigil Trust and Financial Advocacy of Wausau, Wisconsin, or its successors (Vigil). 3 No. 2022AP1213-D

¶6 WTC was the entity that provided investment management

services to Vigil’s trust clients. Vigil was a registered

tradename for Investors Independent Trust Company (IITC).

Attorney Batterman did not have an ownership interest in IITC

and was neither an employee nor an officer of IITC.

¶7 A trust services agreement between WTC and IITC

permitted employees of WTC and Financial Fiduciaries to assist

IITC with ministerial duties in the administration of trusts in

which Vigil is to be named trustee.

¶8 J.G. died on December 27, 2014. At that time, the

trust was required to distribute 25% of the trust assets to each

of the four beneficiaries. Vigil was the trustee.

¶9 In February of 2015, Attorney Batterman discussed the

administration of the trust with his then-fiancé, D.R., who was

the senior manager for the Relay for Life division of the

American Cancer Society. Attorney Batterman and D.R. discussed

an incremental distribution to the American Cancer Society over

a period of up to ten years and discussed splitting the gift between the Eagle River and Wausau Relay for Life.

¶10 The unambiguous language of the trust stated that 25%

of trust assets shall be distributed to the American Cancer

Society. There was no provision in the trust which provided for

incremental distribution. In a May 20, 2015 email to the

American Cancer Society, Attorney Batterman offered only

incremental distribution of trust assets. Attorney Batterman

told the American Cancer Society that Vigil was his company, although he had no ownership interest in it. In a June 15, 2015 4 No. 2022AP1213-D

letter to the American Cancer Society, Attorney Batterman said

the trust was discretionary, when he knew it was an irrevocable

trust. In the letter, Attorney Batterman said that the donor

wished to remain anonymous, which was also not true.

¶11 The trust provided that after J.G.’s death, 25% of

trust proceeds be distributed to Bruce High School. Instead,

Vigil hired a law firm to create the J.G. Scholarship Trust.

Attorney Batterman was the primary contact person with the law

firm. The scholarship trust was created without notice to Bruce

High School. The scholarship trust named Vigil as the trustee,

and Attorney Batterman was named trust protector. As trust

protector, Batterman should have informed Bruce High School of

its status as beneficiary to the trust. In a July 9, 2015 email

to the high school, Attorney Batterman failed to inform the high

school that the trust was required to distribute 25% of the

trust assets to the school. Attorney Batterman also failed to

inform the school that Vigil was the trustee and Attorney

Batterman was the trust protector. ¶12 In late June or early July of 2015, the Alzheimer’s

Association Major Gifts Division made contact with Attorney

Batterman because the Alzheimer’s Association had received

information of its status as a beneficiary of a trust for which

Vigil was the trustee. Attorney Batterman sent an email to the

Alzheimer’s Association Trust and Estate Specialist on July 6,

2015 saying he was “just going to begin the process of trying to

get in touch with the local Alzheimer’s office.” Prior to that date, neither Vigil nor Attorney Batterman had notified the 5 No. 2022AP1213-D

Alzheimer’s Association of its status as a beneficiary, as was

the trustee’s duty. In the same email, Attorney Batterman

identified the trust as revocable when he knew that the trust

was irrevocable. Attorney Batterman knew the trust required

distribution of 25% of the trust assets to each of the four

named fiduciaries.

¶13 In July 2015, over six months after J.G.’s death,

Attorney Batterman first notified the Superior, Wisconsin

Diocese of the Catholic Church of its status as a beneficiary

under the trust.

¶14 In September and October of 2015, the American Cancer

Society, the School District of Bruce, the Superior, Wisconsin

Diocese of the Catholic Church, and the Alzheimer’s Association

all filed petitions for the removal of the trustee in the matter

of the J.G. Revocable Trust filed in Marathon County Circuit

Court. In its petition, the American Cancer Society alleged

that Attorney Batterman concocted a plan to distribute funds

over a ten year period, rather than make an outright gift to the American Cancer Society as required by the trust instrument.

Through this plan Attorney Batterman would reap the benefit of

long-term trustee and investment fees paid from the trust, while

his fiancé, an American Cancer Society employee responsible for

implementing the local Relay for Life events, would benefit from

enhanced opportunities for salary increases through the trust’s

stepped-up annual gifting.

¶15 Bruce High School alleged that Attorney Batterman failed to notify the school it was entitled to a one-time 6 No. 2022AP1213-D

distribution of its 25% share, and instead Vigil created a

scholarship trust. Bruce High School also alleged that Attorney

Batterman failed to notify the school that Vigil was the trustee

and Attorney Batterman was the trust protector.

¶16 Attorney Batterman filed a responsive affidavit

addressing the four petitions requesting removal of the trustee.

On October 23, 2015, the circuit court granted the petitioners’

requests for removal of the trustee and appointed Attorney

Terrance Byrn as the new successor trustee.

¶17 On March 1, 2017, Attorney Batterman was deposed in

the trust matter. In his sworn deposition testimony, he

acknowledged that J.G. never indicated he wanted his gifts to be

anonymous. Attorney Batterman also admitted that while he

stated to the American Cancer Society that the trust was a

discretionary trust, Vigil in fact had no discretion over the

trust.

¶18 A court trial was conducted in the trust case on April

27 and May 23, 2017. On September 18, 2017, the circuit court determined:

Vigil owes each beneficiary a duty to inform and report. Breach of this duty constitutes a breach of trust. From the testimony, the Court cannot help but find Mr. Batterman, slash, Vigil failed to provide the necessary information to several of the beneficiaries regarding the gift in a timely manner and upon request in which many ways has resulted in this extensive and arguably unnecessary litigation...

This Court finds that the manner in which Vigil failed to give the appropriate notice to the American Cancer Association and the manner in which the gift was set up for distribution not authorized within the trust

7 No. 2022AP1213-D

document, often providing incomplete information and by setting up unilaterally disposition - - or distribution plans which arguably favor Vigil’s constant breach of loyalty and duty to inform and report. ¶19 Following the circuit court’s decision, significant

litigation ensued regarding payment of attorney’s fees. In a

March 19, 2018 oral ruling, the circuit court ordered that

Attorney Batterman and Vigil shall be jointly and severally

liable for attorney’s fees. Attorney Batterman and Midwest

Trust Company, the successor in interest to IITC, filed a notice of appeal. In January 2019, the appeal was voluntarily

dismissed.

¶20 The OLR’s complaint alleged the following counts of

misconduct with respect to Attorney Batterman’s handling of the

J.G. Trust:

Count 1: By engaging in conduct that amounted to a breach of trust in In the Matter of the [J.G.] Revocable Trust, Attorney Batterman violated SCR 20:8.4 (c). 2

Count 2: By misrepresenting to ACS that the trust donor wished to remain anonymous and that the funds came from a discretionary trust, Attorney Batterman violated SCR 20:8.4 (c). ¶21 The OLR’s complaint also alleged that the American

Cancer Society filed a complaint with the Securities Exchange

Commission (SEC) against Financial Fiduciaries and Attorney

Batterman. The SEC investigated the complaint. In a March 5,

2 SCR 20:8.4 (c) provides: “It is professional misconduct for a lawyer to engage in conduct involving dishonesty, fraud, deceit or misrepresentation.”

8 No. 2022AP1213-D

2018 order, the SEC found that Attorney Batterman caused

Financial Fiduciaries’ violations of various sections of the

Advisers Act, which prohibits an investment advisor from

engaging in a transaction, practice, or course of business which

operates as a fraud or deceit upon a client or a prospective

client and requires an advisor to take enumerated steps to

safeguard client assets over which it has custody. In addition,

the SEC found that Attorney Batterman willfully made untrue

statements of material fact in a registration application or

report filed with the Commission or willfully omitted to state

material facts. The SEC ordered Financial Fiduciaries to pay a

civil money penalty in the amount of $40,000, and it ordered

Attorney Batterman to pay a civil money penalty in the amount of

$20,000.

¶22 The OLR’s complaint alleged the following count of

misconduct with respect to the SEC proceeding:

Count 3: By causing Financial Fiduciaries’ violations of Sections 206(2), 206(4) and 207 of the Advisors Act in In the Matter of Financial Fiduciaries, LLC and Thomas Batterman, SEC Administrative Proceeding File No. 3-18385, Attorney Batterman violated SCR 20:8.4 (c). ¶23 Finally, the OLR’s complaint alleged that on April 10,

2018, Attorney Batterman was pulled over while operating his

vehicle at 46 miles per hour in a 35 mile per hour zone. During

the traffic stop, the officer detected a strong odor of

intoxicants coming from Attorney Batterman, as well as glassy

eyes and slurred speech. The officer detected some impairment in field sobriety tests and requested Attorney Batterman to

9 No. 2022AP1213-D

submit to a preliminary breath test, which Attorney Batterman

declined. Based on the field sobriety tests, Attorney Batterman

was placed under arrest for Operating While Intoxicated, 2nd

offense. Attorney Batterman subsequently submitted to a blood

draw showing a blood alcohol content of .124, in excess of the

legal limit in Wisconsin.

¶24 On October 19, 2021, a jury found Attorney Batterman

guilty of Operating with a Prohibited Alcohol Concentration, 2nd

offense. He was sentenced to 15 days confinement in the

Marathon County jail, 13 months driver’s license revocation and,

12 months ignition interlock. Attorney Batterman appealed, and

his sentence has been stayed pending appeal.

¶25 The OLR’s complaint alleged the following count of

misconduct with respect to the OWI conviction:

Count 4: By engaging in conduct leading to a criminal Conviction of Operating with a PAC 2nd offense in State of Wisconsin v. Thomas Batterman, Marathon County Case No. 2018CM752, Attorney Batterman violated SCR 20:8.4 (b). 3 ¶26 Attorney Batterman filed his petition for revocation

by consent on December 8, 2022. The petition alleges that

Attorney Batterman cannot successfully defend himself against

the professional misconduct alleged in the complaint. The

petition states Attorney Batterman has been represented by

counsel in the matter and is freely, voluntarily, and knowingly

SCR 20:8.4 (b) provides: “It is professional misconduct 3

for a lawyer to commit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects.”

10 No. 2022AP1213-D

filing his petition for revocation by consent. Attorney

Batterman further states that by filing the petition he

understands he is giving up his right to further contest each

misconduct allegation in the complaint.

¶27 The OLR filed a memorandum recommending that Attorney

Batterman’s petition for revocation by consent be granted and

that his Wisconsin law license be revoked.

¶28 Having reviewed Attorney Batterman’s petition for

consensual revocation and OLR’s recommendation on the petition,

we grant Attorney Batterman’s petition for the revocation of his

license to practice law in Wisconsin. In the trust proceeding,

Attorney Batterman engaged in conduct involving dishonesty,

fraud, deceit or misrepresentation. The SEC found that he

engaged in conduct which operated as a fraud or deceit upon a

client.

¶29 The seriousness of Attorney Batterman’s misconduct

demonstrates that it is appropriate to revoke his law license in

order to protect the public, the courts, and the legal system from repetition of his misconduct; to impress upon him the

seriousness of his misconduct; and to deter other attorneys from

engaging in similar misconduct. This court has previously

revoked attorneys’ licenses when they face multiple counts of

misconduct, including misconduct consisting of dishonesty,

fraud, deceit or misrepresentation. See, e.g., In re

Disciplinary Proceedings against Vaitys, 2019 WI 85, 388 Wis. 2d

259, 932 N.W. 2d 400.

11 No. 2022AP1213-D

¶30 Since this matter was resolved without the need to

appoint a referee, we assess no costs against Attorney

Batterman.

¶31 IT IS ORDERED that the petition for consensual license

revocation is granted.

¶32 IT IS FURTHER ORDERED that the license of Thomas W.

Batterman to practice law in Wisconsin is revoked, effective the

date of this order.

¶33 IT IS FURTHER ORDERED that Thomas W. Batterman shall

comply with the provisions of SCR 22.26 concerning the duties of

a person whose license to practice law in Wisconsin has been

12 No. 2022AP1213-D.akz

¶34 ANNETTE KINGSLAND ZIEGLER, C.J. (concurring). I

concur in the court's order revoking Attorney Batterman’s

license to practice law in Wisconsin. I write separately to

point out that in Wisconsin the "revocation" of an attorney's

law license is not truly revocation because the attorney may

petition for reinstatement after a period of five years. See

SCR 22.29(2). I believe that when it comes to lawyer

discipline, courts should say what they mean and mean what they

say. We should not be creating false perceptions to both the

public and to the lawyer seeking to practice law again. See In

re Disciplinary Proceedings Against Moodie, 2020 WI 39, 391

Wis. 2d 196, 942 N.W.2d 302 (Ziegler, J., dissenting). And, as

I stated in my dissent to this court's order denying Rule

Petition 19-10, In the Matter of Amending Supreme Court Rules

Pertaining to Permanent Revocation of a License to Practice Law

in Attorney Disciplinary Proceedings, I believe there may be

rare and unusual cases that would warrant the permanent

revocation of an attorney's license to practice law. See S. Ct. Order 19-10 (issued Dec. 18, 2019) (Ziegler, J., dissenting).

¶35 I am authorized to state that Justices REBECCA GRASSL

BRADLEY, BRIAN HAGEDORN, and JILL J. KAROFSKY join this

concurrence.

1 No. 2022AP1213-D.akz