Local case could change Connecticut’s attorney disciplinary system

A Wilton 12-year-old named Danny finds himself in the middle of an attorney misconduct controversy that has the potential to change Connecticut’s attorney disciplinary system.

The case involves millions of dollars and “some of the best-known and well-connected attorneys in Connecticut,” according to a press release from Connecticut-based legal malpractice attorney Howard Altschuler.

“Danny D’Attilo appears to be the victim of a system of attorney self-regulation that is turning a blind eye to allegations of unethical conduct of Danny’s former attorneys” — Day Pitney and Koskoff Koskoff & Bieder — “who are being treated as if they are too big to discipline,” the press release further states.

In May 2011, a jury awarded $58.6 million — the largest medical malpractice award in Connecticut history — to Danny and his parents, Cathy and Domenic D’Attilo, as a result of a doctor’s negligence which left Danny “severely disabled at birth and cut his life expectancy more than half,” according to the press release.

The medical malpractice parties settled in January 2012 for $25 million in order to avoid an appeal.

Altschuler told The Bulletin he was approached by Danny’s parents in May 2014 because “among other things, they were afraid their prior attorneys had not protected Danny’s future” and “they wanted to make sure Danny was never institutionalized and would always live at home.”

“The trust set up by Day Pitney did not address this critical issue. Instead, the trust envisioned that the remaining assets after all the D’Attilos passed away would go into a foundation overseen by Brad Gallant of Day Pitney for an unspecified amount of trustee fees,” Altschuler said.

“It was likely, based upon actuarial tables and projected costs, that the foundation would have millions of dollars in it.”

Altschuler said the D’Attilos were also concerned about the huge fees charged by the court-appointed trustees.

“The first trustee, Brad Gallant, had charged about $160,000,” he said, and “Danny’s initial trust was funded with almost $13 million, although the Koskoff firm had presented expert testimony at the medical malpractice trial in May 2011 that Danny would need approximately $8 million to take care of his needs for his entire lifetime.”

Day Pitney’s trust fees were determined as a percentage of the funds held in trust, said Altschuler.

In a civil complaint filed in New Haven Superior Court and in grievances filed with the Connecticut Statewide Grievance Committee (SGC), Danny and his parents allege that their attorneys from Koskoff Koskoff & Bieder and Day Pitney conspired to misappropriate $4.34 million in illegal legal fees from the $25 million settlement and then failed to provide proof of more than $600,000 in purported legal expenses.

Grievances for a number of related issues were filed against these attorneys, who include a former president of the Connecticut Bar Association and a member of a local grievance panel, who had initially been assigned to review two grievances connected to his own grievance, according to Altschuler.

“The impartiality of the process is further under fire because two of the attorneys were represented by a former chief disciplinary counsel,” according to Altschuler’s press release — “the same person who presented prosecutions to the SGC for six years.”

In a recently filed motion with the Connecticut Supreme Court, the D’Attilos are asking the court to “review, investigate, and if necessary, reform the state’s disciplinary system for what the D’Attilos allege is an attorney disciplinary process that leaves Connecticut clients vulnerable to unethical attorneys, with no right to appeal,” according to Altschuler.

The D’Attilos filed this motion more than a decade after they signed a retainer agreement with Koskoff Koskoff & Bieder, a medical malpractice firm based in Bridgeport, on March 21, 2003.

The 2003 agreement specified the exact calculation for fees, which, in this case, was $2.66 million. However, in 2012, Koskoff Koskoff & Bieder deducted $7 million in legal fees.

“When I was initially retained, I asked the D’Attilos to see the Koskoff retainer agreement, a standard procedure for all of my legal malpractice clients. They did not have a copy,” said Altschuler.

“I asked their prior attorneys for a copy of their entire files. When I received the files, I read the retainer agreement, and immediately saw that the retainer agreement clearly stated in black and white that it was subject to the fee cap statute, which meant that for a $25 million settlement, the fee calculation should have been $2.66 million rather than $7 million. I was shocked.”

Although the grievance committee found “probable cause of professional misconduct” against two of the Koskoff Koskoff & Bieder attorneys, “they are being offered an extraordinary sweetheart deal by Connecticut’s Office of Chief Disciplinary Counsel (OCDC),” according to Altschuler — whereby they can avoid any hearing and any further investigation “simply by accepting a slap on the wrist reprimand only for their undocumented $600,000+ in legal expenses.”

This offer, according to Altschuler, permits the attorneys to keep the extra $4.34 million in legal fees allegedly misappropriated, as well as the $600,000 or more in expenses they are unable to document to the OCDC. Furthermore, Altschuler said, the OCDC is not investigating Koskoff Koskoff & Bieder’s accounting practices to see if other clients had similar problems.

“There is nothing the D’Attilos can do about this because Connecticut clients do not have the right to appeal any decision of Connecticut’s self-regulated attorney disciplinary system, no matter how bad, unfair, biased, or plainly wrong the decision may be,” said Altschuler. “The D’Attilos are fighting this injustice.”

Self-regulated system

In Connecticut’s “self-regulated attorney disciplinary system” Altschuler said, “most lawmakers are lawyers, and as far as I know, all judges are lawyers, so lawyers are not only making the rules, but they are ultimately enforcing the rules.”

“While other licensed professions may determine whether someone loses a license, such as a doctor, if there is any appeal, it ends up in court, where judges, who are lawyers, decide,” he said.

This is summarized in the Connecticut Rules of Professional Conduct as: “Although other professions also have been granted powers of self-government, the legal profession is unique in this respect because of the close relationship between the profession and the processes of government and law enforcement.”

Connecticut’s grievance system

In Connecticut, anyone can file a grievance complaint with the Statewide Grievance Committee (SGC), according to Altschuler, and under certain circumstances, attorneys may have an obligation to report suspected unethical behavior.

“The SGC does an initial review to see whether it falls within certain exceptions that are not subject to grievance,” said Altschuler, “and if so, lets the person who complains know.”

Altschuler said a person can “appeal” to the SGC by essentially asking the SGC to reconsider and if it does not fall within one of the exceptions, “the grievance is forwarded to a local panel to determine whether there is probable cause the attorney committed professional misconduct.”

Probable cause is not the same as preponderance of the evidence, said Altschuler, as “there has to be some reasonable suspicion that the person has engaged in the activity.”

“The local grievance panel does not determine whether the attorney actually engaged in professional misconduct, only whether there is evidence that there is a reasonable suspicion of such misconduct,” he said.

While it is not required, Altschuler said, a local panel has the right to hold a hearing, and if the local panel finds there is “no probable cause, currently, the person filing a grievance has absolutely no right to challenge the result no matter what.”

However, he said, “there is a rule … which states that if the grievance complaint includes criminal allegations, the local panel is required to forward the grievance with the SGC for additional review.”

That did not happen in the D’Attilos’ case, said Altschuler, who will be “taking legal action related to that issue.”

Next step

Altschuler said the status of the case is “an interesting issue” because the civil case is in a state of suspended animation and “there is not normally a category of cases that are in suspended animation,” making this case “unique in that regard.”

The 2003 retainer agreement has an arbitration clause, which the defendants filed a motion to enforce. In other words, Altschuler said, “they were also acknowledging the viability and enforceability of the other terms of the March 21, 2003 retainer agreement, including the fee calculation.”

“The court granted their motion to stay. However, the arbitration provision in the retainer agreement does not contain any guidance as to who does the arbitration or what the procedures are,” said Altschuler.

“After the stay was granted, the defendants demanded to do the arbitration in a particular way, but in my view had no right to make that demand.”

Altschuler said the defendants then filed a motion to compel arbitration, “except they did it the wrong way.”

“Unless the defendants now file a motion to compel arbitration the correct way as detailed by the judge in his decision, the process of arbitration will never begin. In other words, technically speaking, if the defendants do nothing and I do nothing, nothing will ever happen in the civil case,” he said.

“This is a crazy outcome that results from a Supreme Court case that does not permit litigants to appeal the granting of the motion to stay. To address this unusual, if not unique situation, I will be taking some legal action related to this in the near future.”

As for the grievance, Altschuler said, a Feb. 4, 2016 public hearing is tentatively scheduled.

During this hearing, the Statewide Grievance Committee will decide whether to accept the grievance plea bargain made between the Chief Disciplinary Counsel and the two respondents.

If the committee accepts the offer to let Koskoff Koskoff & Bieder attorneys Kathleen Nastri and Michael Koskoff “only be reprimanded for accounting procedures,” Altschuler said, the D’Attilos have no right to appeal.

“This is part of what we will be challenging in other legal pleadings that will be filed shortly,” said Altschuler.

System reform

Altschuler said he and his clients hope their case will lead to the reform of Connecticut’s attorney grievance system, “just as serious concerns regarding probate court led to substantial reforms of Connecticut’s probate court system a few years ago.”

“When it comes to seeking the reform of the grievance system, and the rights of those who complain about the grievance process, the system seems to be resistant to change,” said Altschuler, who believes that “the results so far of the D’Attilo grievance requires significant reforms to the grievance system.”

In addition to legal action the D’Attilos will soon be instituting, Altschuler said, he and his clients we will contact state legislators on the issue, “to further raise public awareness.”

“The legislative aspect of this is more long-term, and my clients will soon be asking state legislators to conduct the same kind of investigation and analysis of the grievance system that they previously did with the probate system,” he said.

In Altschuler’s press release, former secretary of the state Susan Bysiewicz, currently a partner at Pastore & Dailey, commented that “Connecticut’s attorney disciplinary system is clearly broken because it treats attorneys who engage in the same types of misconduct differently.”

“This,” she said, “is an egregious result and the entire system should be reformed immediately.”

Altschuler said there currently is no proposed plan to change the state’s attorney discipline system.

Click here to view the civil complaint.

Click here to view a copy of the grievance (pages 126-167).

Click here to view the D'Attilos' Connecticut Supreme Court motion.