On Review of a Report and Recommendation of the Board on Professional Responsibility
Before Rogers, Chief Judge, Pryor, and Mack, Senior Judges.* Separate Statement by Senior Judge Mack.
The opinion of the court was delivered by: Mack
PER CURIAM: In 1985 a jury of the United States District Court for the District of Columbia convicted respondent John A. Shorter, Jr., a member of our bar, of one felony count of willful tax evasion, 26 U.S.C. § 7201 (1982), and six misdemeanor counts of willful failure to pay taxes, 26 U.S.C. § 7203 (1982 & Supp. V 1987). *fn1 on January 10, 1986, finding that respondent had been convicted of a serious crime within the meaning of Bar Rule XI, § 15 (1), (4) *fn2 law, we accordingly referred the matter to the Board on Professional Responsibility with instructions to institute proceedings "for determination of the final discipline to be imposed" and "to review the elements of the crime for which Respondent was sentenced for the purpose of determining whether or not the crime involves moral turpitude within the meaning of D.C. Code § 11-2503 (a) [(1989 Repl.)]." *fn3
In his defense, respondent argues that his tax crimes were the product of a pathological gambling disorder, for which he should not be held responsible. A Hearing Committee of the Board on Professional Responsibility found insufficient causation between respondent's pathology and his legal difficulties to support this defense or to warrant its consideration in mitigation of sanctions. Concluding that his crimes violated disciplinary rules DR 1-102 (A) (4) and DR 1-102 (A) (5), (infra) page , but involved no moral turpitude, it refrained from recommending his disbarment. Instead, as a lesser sanction, it recommended his suspension from the practice of law for a period of four years effective nunc pro tunc to the date of his original temporary suspension by this court. The full Board, however, while adopting the Hearing Committee's factual findings, has now submitted a report recommending respondent's disbarrment with a five year suspension dating from the original temporary imposition of that sanction. Based on the record and findings of the Hearing Committee and the Board, we conclude that respondent violated DR 1-102 (A) (4), and we adopt the Board's recommendation of disbarment, effective nunc pro tunc to January 10, 1986, the date of his initial temporary suspension. *fn4
Respondent is a highly regarded member of our criminal defense bar. In sentencing him for tax offenses, the federal district Judge described him as "an attorney who enjoys great esteem of the Bench and Bar," "a fine lawyer learned in the law," and "an excellent trial lawyer" who has often done professional work pro bono. In like manner, the Hearing Committee reported that "there here has never been any suggestion that Respondent has ever, in his relationships with his clients and the judicial system, demonstrated anything other than the highest standards of diligence and integrity."
Notwithstanding these professional virtues, the district Judge also characterized respondent as "a notorious and long-time tax evader," who "has hardly paid any tax for the twelve years of the indictment, and not much more in the preceding eleven." In fact, this is not the first time that our court has been called upon to discipline respondent for tax-related offenses. *fn5 From 1965 to 1969 he filed no tax returns, and in 1974 he pled nolo contendere on federal charges of willful failure to file an income tax return. *fn6 As a result of these infractions, by unpublished opinion, we ordered his suspension for six months.
Respondent asserts that his earlier tax troubles did not teach him "a complete lesson":
What I learned from that lesson is that you should file returns, but I didn't take the additional step. From that point on I filed returns and I filed honest returns, I failed to pay taxes. So I corrected the mistake that I was making but I created another mistake when I started filing returns but not paying the taxes and it wasn't that I had any criminal intent in mind for the taxes. When the tax returns were prepared every April 15th for every year that's involved, I didn't have the money to pay the taxes.
The reason respondent "didn't have the money," as the Internal Revenue Service would eventually learn, was that, to protect himself against his own gambling habit, *fn7 respondent had long earlier adopted a "cash life-style": he had no bank or checking accounts, no credit cards, no real property or automobiles, and no personal assets. All of his expenses were paid by his firm from accounts held solely in the name of his law partner, Bernadette Gartrell.
The matter before us arises from respondent's 1985 federal conviction for failure to pay income taxes from 1972 through 1983. According to the Hearing Committee's figures, of $134,866.40 in federal taxes due for that period, respondent paid $2,536.40. *fn8 When, in the course of tax collection efforts dating from 1975 to 1980, IRS agents took signed financial statements from respondent based on oral interviews, he informed them that he lacked any personal assets. At the criminal trial, Agent Vernon Rippen testified that when, at an April 1975 interview with respondent, he asked "if he had any bank account or any interest in any bank account. . . he replied no." When he asked if respondent had "any other assets like trailers, boats, horses, that type of thing," he again "replied no. . . ." The form Rippen used in taking this statement did not include a question about partnership interests.
Similarly, when Agent Vito Acquaviva met with respondent to take another financial statement, he asked him if "he had cash in a bank account or a savings account or any other financial institution," and respondent answered that "he had no accounts whatsoever." When, referring to the inclusion of respondent's name in the name of his law firm ("Mitchell, Shorter and Gartrell"), Acquaviva inquired about his interest in the firm, respondent replied that he only had an office sharing arrangement with Gartrell, to which she had agreed in a spirit of generosity. Acquaviva also claimed that when asked how he was able to pay his expenses, respondent explained that "Ms. Gartrell allowed him to use the offices until such time as he was able to meet his expenses and that she was doing this out of the goodness of her heart." (In testifying before the Hearing Committee, respondent denied that he had made the last of these remarks.) Although respondent informed Acquaviva that he intended to send money to the IRS, he failed to do so. When Acquaviva served a notice of levy on respondent's law firm, respondent requested that no further notices be sent to the firm, and after again making a financial statement denying that he possessed any assets, entered into a written agreement to make monthly payments to the IRS of $200.00. These payments were never made. *fn9
As one IRS agent admitted during the criminal trial, respondent's statements about his personal assets were technically true. Respondent's testimony before the Hearing Committee illustrates this:
A. hat was under Discussion were my personal taxes and the agents were attempting to ascertain what my assets were in order to collect the taxes. And after talking to them I explained to them that I had no assets. They were concerned about automobiles, real estate, money in the bank, bank accounts and other assets; and I explained to them I didn't have any assets. . . . hey would ask me, did I have a bank account and I would say no, I had no bank account. Did I have an automobile[?] I had no automobile. Had stocks and bonds[?] o. Do you have any life insurance[?] No, I didn't have any life insurance.
Q. Did they ever ask you whether you have a partnership bank account?
A. You see the questions were put to me on the basis of what did I have.
A. Individually, yes. As far as any cash on hand, bank accounts and any other assets.
When the Hearing Committee asked respondent whether he could have informed IRS agents about the amount and sources of his income if had wanted to do so, he replied:
A. If I had been thinking in that vein and if they had asked me, yes. First off, I answered the questions that they asked me and I didn't attempt to conceal anything and I dealt with the man in a straightforward fashion[.] He knew that I was an attorney, he knew that I was practicing law and they were concerned with what it was that they could seize[,] like cash, automobiles, real estate, stocks and bonds and things of that nature.
Q. But you knew that if you said to them[,] look fellows, you've asked me all these questions but you haven't asked me the right questions[;] if you ask me if the fact is that I've got X thousands of dollars coming in from fees and I turn it over to my partner and she puts it in this bank account and I draw it ...