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July 29, 2010 |
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| November 18, 2009 |
By: John Pacenti |
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esieged Fort Lauderdale attorney and political rainmaker Scott Rothstein is now picking his battles — and trying to stay a lawyer is not one of them.
The ousted chairman of Rothstein Rosenfeldt Adler has decided to surrender his law license, submitting a request of permanent disbarment on consent to the Florida Bar.
Florida Bar disciplinary statistics
The bar confirmed Wednesday it accepted Rothstein’s request, but it must be approved by the Florida Supreme Court. The upshot is that Rothstein would not have to defend himself against a Bar investigation for breaking any rules regulating Florida attorneys.
“While the case is very complex, it became evident that bar rules may have been violated,” Bar president Jesse H. Diner said in a statement Wednesday.
The Bar is monitoring the federal investigation of Rothstein and has been in contact with the court-appointed receiver for the law firm, he said.
“This is a terribly unfortunate and tragic situation,” Diner said. “The Florida Bar will continue to investigate any violations of its rules by other attorneys who may have been involved in this case.”
Rothstein’s attorney, former RRA colleague Marc Nurik, said his client did not want “to waste The Bar’s time or the state’s money. He felt it was appropriate to give up his law license, and this was the mechanism with which to do it,” he said.
The move allows Rothstein to marshall his resources for civil litigation, bankruptcy proceedings and any criminal case. He has not been charged.
The FBI raided the firm’s Fort Lauderdale office two weeks ago and said as much as $1 billion may have been invested in a fraudulent side business run by Rothstein. RRA has said millions of dollars is missing from its trust accounts under Rothstein’s exclusive control.
Ken Marvin, The Bar’s director of lawyer regulation in Tallahassee, said Rothstein would never be able to practice law again in Florida if the Supreme Court approves his request.
Marvin said the e-mailed request included some admissions by Rothstein, but it will not be made public until a hard copy is received by the Florida Supreme Court clerk’s office.
“This happens when their hand gets caught in the cookie jar and there’s video. It’s kind of useless to fight and they want to avoid the costs and aggravation involved,” Marvin said. “They figure, ‘I’m going to lose my law license anyway. Why am I going to fight?’”
Nurik denied Rothstein’s disbarment request contains any specific admissions.
“It’s very vanilla,” he said. “It doesn’t go into specifics or details.”
Craig Waters, spokesman for the Supreme Court, said Rothstein’s request would have to go through an off-site security check before it reaches the court.
It remains unknown how Rothstein’s voluntary disbarment would affect his position on the Judicial Nominating Commission for the 4th District Court of Appeal. Only two direct appointments by the governor have to be attorneys.
Sterling Ivey, Gov. Charlie Crist’s spokesman, did not return a phone call for comment by deadline.
Rothstein donated heavily to the Republican Party and Crist’s campaigns for governor and attorney general.
Nurik said Rothstein’s wife, Kim, is standing by him.
Disbarment on consent became an option for attorneys in 2004-2005, and there were 24 requests for such disbarment in the latest fiscal year, according to The Bar. Laura Hess, a Coral Springs attorney, requested and received disbarment on consent in January. Her firm, Hess Kennedy, is in receivership after the state attorney general’s office claimed the firm and affiliated companies engaged in deceptive debt settlement and debt management practices that harmed thousands of consumers nationally. The receiver counted almost $55 million in valid claims.
Until 2006, attorneys facing criminal allegations had another option with The Bar: disciplinary resignation. But that left the decision in the hands of the attorney.
The lawyer “says instead of disciplinary proceedings, I’m just going to quit,” Marvin said. “It was equivalent with disbarment but no admissions.”
Miami attorney Louis Robles was sentenced to 15 years for bilking his clients of more than $13 million. The Bar rejected Robles’ submission of disciplinary resignation, and he later consented to disbarment on consent, Marvin said.
Meanwhile, Nurik said there would be no showdown today between Rothstein and attorneys for investors who claim they lost more than $1.1 million on Rothstein’s structured settlement investments.
They filed the involuntary bankruptcy petition against Rothstein Rosenfeldt Adler on Nov. 10, and Geonvese Joblove & Battista attorney John Genovese filed a notice Tuesday to depose Rothstein.
Nurik said the notice was insufficient, and “Mr. Rothstein will not be there.”
The next bankruptcy hearing is set for Friday on whether a trustee should be appointed.
While the firm continues to exist, many of its lawyers are heading elsewhere. Five RRA attorneys landed at Rice Pugatch Robinson & Schiller in Fort Lauderdale. Steven Lippman and Richard Storfer joined as partners. Riley Cirulnick, George Zinkler and Jodi Cohen joined the firm as associates.
“While the current situation with RRA is unfortunate, RPRS is presented with a unique opportunity,” said shareholder Arthur Rice of Rice Pugatch.
John Pacenti can be reached at (305) 347-6638. |
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