OLR v. James M. Schoenecker

• Court: Wisconsin Supreme Court
• Decided: December 13, 2019
• Docket: 2015AP000275-D
• Status: Published

Opinion

2019 WI 105

SUPREME COURT OF WISCONSIN CASE NO.: 2011AP48-D & 2015AP275-D COMPLETE TITLE: In the Matter of Disciplinary Proceedings Against James M. Schoenecker, Attorney at Law:

Office of Lawyer Regulation, Complainant-Respondent, v. James M. Schoenecker, Respondent-Appellant.

DISCIPLINARY PROCEEDINGS AGAINST SCHOENECKER

OPINION FILED: December 13, 2019 SUBMITTED ON BRIEFS: ORAL ARGUMENT:

SOURCE OF APPEAL: COURT: COUNTY: JUDGE:

JUSTICES: CONCURRED: DISSENTED: NOT PARTICIPATING:

ATTORNEYS: 2019 WI 105 NOTICE This opinion is subject to further editing and modification. The final version will appear in the bound volume of the official reports. No. 2011AP48-D, 2015AP275-D

STATE OF WISCONSIN : IN SUPREME COURT

In the Matter of Disciplinary Proceedings Against James M. Schoenecker, Attorney at Law:

Office of Lawyer Regulation, FILED Complainant-Respondent, DEC 13, 2019 v. Sheila T. Reiff Clerk of Supreme Court James M. Schoenecker,

Respondent-Appellant.

ATTORNEY Reinstatement proceeding. Reinstatement granted.

¶1 PER CURIAM. We review the report and recommendation of Referee James J. Winiarski recommending that James M.

Schoenecker's license to practice law in Wisconsin be

reinstated. After careful review of the matter, we agree that

Attorney Schoenecker's license should be reinstated with certain

conditions recommended by the referee. We further agree with

the referee that, consistent with our general practice, Attorney

Schoenecker should be required to pay the full costs of this

reinstatement proceeding, which are $14,754.78 as of October 7, 2019. No. 2011AP48-D, 2015AP275-D

¶2 Attorney Schoenecker was admitted to practice law in

Wisconsin in 2004. He is a graduate of Boston College and

Columbia University Law School. He practiced briefly in New

York, then practiced at Quarles and Brady in Milwaukee for a

time, and finally practiced at the Clair Law Offices, a small

law firm in Delevan.

¶3 In 2011, Attorney Schoenecker's license was suspended

for three years. See In re Disciplinary Proceedings Against

Schoenecker (Schoenecker I), 2011 WI 76, 336 Wis. 2d 253, 804

N.W.2d 686. Much of the misconduct in that case arose out of

Attorney Schoenecker's personal and professional relationship

with his former fiancée. In late 2007, Attorney Schoenecker and

his fiancée opened a joint checking account and the fiancée

obtained a home equity line of credit and loaned Attorney

Schoenecker $48,500. Attorney Schoenecker executed a promissory

note whereby he promised to repay the loan with interest. Two

days later, the fiancée learned Attorney Schoenecker had made

cash withdrawals from her checking account at a casino, resulting in a $1,500 negative balance in her account. She

closed the joint checking account and ended her engagement to

Attorney Schoenecker.

¶4 Attorney Schoenecker repaid part of the loan balance.

At some point the former fiancée filed a collection action

against him. The parties reached a settlement, and Attorney

Schoenecker paid the former fiancée over $32,000 as part of a

full resolution of their financial issues.

2 No. 2011AP48-D, 2015AP275-D

¶5 In December 2008, Attorney Schoenecker used the former

fiancée's personal information to enter her business account

without her permission and made checks payable to himself. As a

result of these actions, he was charged in two separate criminal

proceedings, one in Walworth County where he pled guilty to one

felony count of identity theft and was placed on two years of

probation and ordered to make restitution and pay court costs,

and one in Waukesha County where he pled guilty to a misdemeanor

charge of Theft-Moveable Property. The Waukesha County circuit

court imposed and stayed a four-month jail sentence and placed

Attorney Schoenecker on probation for one year. In addition,

Attorney Schoenecker was required to pay restitution to the

former fiancée and pay court costs.

¶6 In 2008, Attorney Schoenecker became an associate at

the Clair Law Offices. He told the law firm he was representing

his former fiancée, so she was considered a firm client. He

sent invoices to the former fiancée in the fall of 2008 showing

that she owed over $13,000. A substantial number of the entries on the invoices were fraudulent.

¶7 Attorney Schoenecker also set up his own separate law

firm on the side while he was working as an associate at the

Clair Law Offices. He did not inform the law firm of this fact.

In addition to the incidents involving the former fiancée and

the Clair Law Office, Attorney Schoenecker's 2011 suspension

also arose out of his making fraudulent statements in his own

personal bankruptcy proceeding.

3 No. 2011AP48-D, 2015AP275-D

¶8 In 2016, Attorney Schoenecker received an additional

one-year license suspension. See In re Disciplinary Proceedings

Against Schoenecker (Schoenecker II), 2016 WI 27, 368

Wis. 2d 57, 878 N.W.2d 163. The misconduct at issue in that

case arose out of Attorney Schoenecker's involvement in a

business partnership he entered into in 2012 with two other men.

The men established a limited liability company. One man gave

Attorney Schoenecker $25,000 in cash as his capital

contribution, and the other man contributed $20,000. Instead of

immediately depositing the $25,000 capital contribution into a

business account, Attorney Schoenecker deposited the bulk of

that money into his own personal checking account. He also used

company funds to pay personal credit card bills without

preapproval from his partners, and he withdrew funds from

company accounts in order to gamble at Potawatomi Casino in

Milwaukee.

¶9 Attorney Schoenecker filed his first petition for

reinstatement of his law license in early 2017. In 2018, this court denied the petition, agreeing with the referee that

Attorney Schoenecker had failed to meet his burden of proof to

establish the requirements of reinstatement at that time. In re

Disciplinary Proceedings Against Schoenecker, 2018 WI 58, 381

Wis. 2d 644, 912 N.W.2d 847. This court stated that Attorney

Schoenecker could again file a petition for reinstatement six

months after the date of its decision.

¶10 In November 2018, Attorney Schoenecker filed a second petition for reinstatement. A public hearing was held before 4 No. 2011AP48-D, 2015AP275-D

the referee on June 18 and 19, 2019. Numerous witnesses

testified at the hearing in favor of Attorney Schoenecker's

reinstatement petition.

¶11 One of the witnesses who testified on Attorney

Schoenecker's behalf was James Harrison, a clinical substance

abuse counselor, licensed professional counselor, international

certified gambling addiction counselor, and board-approved

clinical consultant. Mr. Harrison testified that he began

seeing Attorney Schoenecker in April of 2015. Mr. Harrison said

Attorney Schoenecker has gone above and beyond what many people

do in outpatient treatment and has voluntarily continued his

counseling sessions for over four years, whereas Mr. Harrison

normally sees clients for only two to four months in counseling

sessions. Mr. Harrison testified that Attorney Schoenecker's

willingness to continue the counseling sessions was indicative

of how seriously he takes his situation. As a result of this

dedication, Mr. Harrison opined that Attorney Schoenecker's risk

level to return to his previous behavior and actions has diminished.

¶12 Mr. Harrison testified that Attorney Schoenecker has

come to the conclusion that gambling can no longer be part of

his life and he has been bet-free for over four years.

Mr. Harrison said:

It should be noted that Attorney Schoenecker has a disease. A disease of gambling addition. It is a disease that often results in good people making inappropriate decisions and poor choices.

5 No. 2011AP48-D, 2015AP275-D

Not to be used as an excuse by any means for his behavior, but certainly a contributing factor to what he did. It is also a disease that can be brought under control if treated immediately and continue to be treated. Attorney Schoenecker is definitely an example of this.

But with the continued support of his family, friends, co-workers, and counseling, and by continuing with his counseling sessions, Attorney Schoenecker can and will make a positive difference in his life as well as the lives of others.

Therefore, if he follows his treatment plan, continues to make the changes that are necessary and needed in his life, continues with his counseling sessions; develops, utilizes, and maintains a positive support system and network and acts and lives responsibly, Attorney Schoenecker can and will make sure that he will not put himself or others in this predicament again. ¶13 While Mr. Harrison agreed that there is no guarantee

Attorney Schoenecker would not relapse, he stated the chances of

relapse were very minimal so long as Attorney Schoenecker

continues what he has been doing for the past four years. When

asked if had any opinion regarding whether anything outside of

the gambling addiction might explain Attorney Schoenecker's conduct, Mr. Harrison said that lying and misconceptions were

part of a gambling addiction. He said, "it is a body rush.

They will do anything they can to obtain that, whether it's

lying, whether it's stealing, whether it's embezzling. So this

is part of the addiction."

¶14 Other witnesses, including friends of Attorney

Schoenecker, his sister, and father also testified that Attorney

Schoenecker has been humbled by his downfall, has become

6 No. 2011AP48-D, 2015AP275-D

compassionate toward others, and has gone out of his way to help

other people.

¶15 Attorney Schoenecker testified that if he were

reinstated he wanted to help others and might be interested in

working as a public defender given what he has learned going

through his own criminal proceedings.

¶16 The parties stipulated to the admission into evidence

of the transcript from the first reinstatement hearing, which

was held in July 2017. The transcript from that hearing

included testimony from Attorney Schoenecker's former fiancée,

one of Attorney Schoenecker's business partners, and an attorney

from the Clair Law Offices. All three of those individuals

testified in the first reinstatement hearing that, in their

opinion, Attorney Schoenecker does not have the moral character

to have his law license reinstated.

¶17 The referee in this reinstatement proceeding issued

his report and recommendation on September 18, 2019. Referee

Winiarski echoed the opinion of the referee from the first reinstatement proceeding that "this is a most difficult

reinstatement case." The referee noted that the sheer number

and nature of Attorney Schoenecker's moral lapses, which led to

the two disciplinary proceedings, indicated that there was more

than a simple gambling addiction problem involved. However, the

referee noted that Attorney Schoenecker fully admits to his

misconduct, does not blame others for the misconduct, and

expresses a degree of disbelief that he committed the acts of misconduct. The referee opined that, "such reflection on his 7 No. 2011AP48-D, 2015AP275-D

part is certainly an indication that he has gone through

considerable self-examination of his misconduct." The referee

noted that according to many of Attorney Schoenecker's

witnesses, he has expressed genuine remorse for his actions; he

has made restitution to his victims; and there was also

testimony regarding the spiritual reflections and actions he has

taken since the time of his misconduct.

¶18 The referee concluded that Attorney Schoenecker, "as a

result of his misconduct, experienced tumultuous changes in his

life and he is not likely to ever repeat such misconduct, given

the consequences."

¶19 The referee noted that this court has indicated that

the primary focus of a reinstatement hearing should be on the

petitioner's conduct between the start of the suspension and the

reinstatement. See In re Disciplinary Proceedings Against

Carroll, 2004 WI 19, ¶16, 269 Wis. 2d 172, 675 N.W.2d 792.

Accordingly, the referee recommends that Attorney Schoenecker's

license to practice law in Wisconsin be reinstated. The referee further recommends that as a condition of reinstatement,

Attorney Schoenecker be required to continue monthly counseling

sessions with either his current counselor or a counselor with

similar credentials. The referee recommends the counseling

should address not only Attorney Schoenecker's gambling

addiction, but also any other possible causes for his previous

misconduct. The referee recommends that the counselor be

required to file semi-annual progress reports with the Office of Lawyer Regulation (OLR) and that such counseling be required to 8 No. 2011AP48-D, 2015AP275-D

continue for a period of at least three years after

reinstatement. Finally, the referee recommends that Attorney

Schoenecker be responsible for all costs of the reinstatement

proceeding.

¶20 No appeal has been filed from the referee's report and

recommendation. Supreme Court Rule (SCR) 22.31(1) provides the

standard to be met for reinstatement. The petitioner must show

by clear, satisfactory, and convincing evidence that he or she

has the moral character to practice law; that his or her

resumption of the practice of law will not be detrimental to the

administration of justice or subversive of the public interest;

and that he or she has complied with SCR 22.26 and the terms of

the suspension. In addition to these requirements, SCR 22.29(4)

states related requirements that the petition for reinstatement

"shall show." All of these additional requirements are

effectively incorporated into SCR 22.31(1).

¶21 This court will adopt a referee's findings of fact

unless they are clearly erroneous. Conclusions of law are reviewed de novo. See In re Disciplinary Proceedings Against

Jennings, 2009 WI 26, ¶22, 316 Wis. 2d 6, 762 N.W.2d 648.

¶22 After careful review of this matter, we adopt the

referee's findings of fact and conclusions of law and agree with

the referee that Attorney Schoenecker has demonstrated he has

met the burden of proof imposed upon him by our Supreme Court

Rules. We agree with the referee that, in order to ensure, to

the extent possible, that Attorney Schoenecker will not relapse, he should be required to continue monthly counseling either with 9 No. 2011AP48-D, 2015AP275-D

Mr. Harrison or a counselor with similar credentials for a

period of three years, with the counselor being required to file

semi-annual progress reports with the OLR. We also agree with

the referee that Attorney Schoenecker should be responsible for

the full costs of this reinstatement proceeding.

¶23 IT IS ORDERED that the petition for reinstatement of

the license of James M. Schoenecker to practice law in Wisconsin

is granted, effective the date of this order.

¶24 IT IS FURTHER ORDERED that, for a period of three

years from the date of this order, James M. Schoenecker shall be

required to continue monthly counseling, either with his current

counselor or a counselor with similar credentials. The

counseling should address not only James M. Schoenecker's

gambling addiction, but also other possible causes for his

previous misconduct. The counselor shall file semi-annual

progress reports with the Office of Lawyer Regulation.

¶25 IT IS FURTHER ORDERED that, within 60 days of the date

of this order, James M. Schoenecker shall pay to the Office of Lawyer Regulation the costs of this proceeding, which are

$14,754.78 as of October 7, 2019.

10 No. 2011AP48-D, 2015AP275-D