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In re Petition for Disciplinary Action Against Gorshteyn

Supreme Court of Minnesota

July 31, 2019

In re Petition for Disciplinary Action against Boris A. Gorshteyn, a Minnesota Attorney, Registration No. 0392840.

          Original Jurisdiction Office of Appellate Courts

          Susan M. Humiston, Director, Cassie Hanson, Managing Attorney, Office of Lawyers Professional Responsibility, Saint Paul, Minnesota, for petitioner.

          Boris A. Gorshteyn, Excelsior, Minnesota, pro se.

         SYLLABUS

         Disbarment is the appropriate discipline for an attorney who misappropriated approximately $382, 000 in client funds, abandoned client matters, settled clients' claims without their knowledge or consent, failed to maintain trust account books and records, failed to cooperate with the Director's investigations, and committed other misconduct.

         Disbarred.

          OPINION

          PER CURIAM

         The Director of the Office of Lawyers Professional Responsibility filed a petition and supplementary petition for disciplinary action against respondent Boris A. Gorshteyn. The petitions allege numerous acts of professional misconduct, including misappropriation of approximately $382, 000 in client funds, abandonment of client matters, settling clients' claims without their knowledge or consent, failing to maintain trust account books and records, and noncooperation with the Director's investigations. Gorshteyn did not file an answer to either petition. Accordingly, we deemed the allegations in both petitions admitted and allowed the parties to file memoranda on the appropriate discipline. Gorshteyn did not file a memorandum or otherwise appear in this matter. The Director asserts that the appropriate sanction is disbarment. We agree.

         FACTS

         Gorshteyn was admitted to the practice of law in Minnesota in 2012. In October 2017, the Director of the Office of Lawyers Professional Responsibility filed a petition for disciplinary action and an amended and supplementary petition for disciplinary action against Gorshteyn. After the Director was unable to personally serve Gorshteyn, we granted the Director's application for suspension under Rule 12(c)(1), Rules on Lawyers Professional Responsibility, and gave Gorshteyn 1 year to file a motion to vacate the suspension and seek leave to answer the petitions. In re Gorshteyn, 902 N.W.2d 922, 923 (Minn. 2017) (order). Gorshteyn did not file such a motion or respond to the petition or supplementary petition.

         Because Gorshteyn failed to respond to either petition, we deemed the allegations in the petition and supplementary petition admitted. In re Gorshteyn, No. A17-1635, Order at 1 (Minn. filed Nov. 5, 2018). We ordered Gorshteyn to show cause why he should not be disciplined and invited the parties to file memoranda on the appropriate discipline to be imposed in this case. Id. at 2. Gorshteyn did not comply with our order to show cause, did not submit a proposal regarding the appropriate discipline, and did not otherwise appear in this matter.

         In July 2013, Gorshteyn started his own practice, Gorshteyn Law, P.C. Gorshteyn was the owner and managing partner of Gorshteyn Law, and his practice mostly handled personal injury matters. Gorshteyn Law primarily served Somali clients, and many of Gorshteyn's clients needed an interpreter to communicate in English.

         In more than 300 paragraphs spanning 60 pages, the petition and supplementary petition set forth detailed accounts of Gorshteyn's extensive professional misconduct between 2014 and 2017. This misconduct was committed against at least 25 clients. We summarize the most relevant misconduct below.

         Misappropriation of client funds and other trust-account related misconduct

         From 2014 to 2016, Gorshteyn misappropriated approximately $382, 000 in client funds from more than 13 clients.[1] He did this by transferring excess fees from his trust account to himself totaling approximately $247, 000. In addition, he disbursed or transferred approximately $134, 600 in client funds to himself without any relation to earned fees and to which he was not entitled.

         Gorshteyn also "failed to disburse from his trust account, or timely disburse from his trust account, numerous clients' funds to or on behalf of the client." Gorshteyn failed to disburse more than 10 clients' funds in a timely manner.

         From January 2014 to June 2016, Gorshteyn did not properly maintain trust account check registers, client subsidiary ledgers, trial balance reports, reconciliation reports, and internet transfer memoranda. He also did not annotate many trust account checks and slips with the affected client's name. Gorshteyn routinely disbursed fees to himself, both through internet transfers and checks drawn on the trust account, without adequately documenting the identity of the affected clients. Further, Gorshteyn allowed non-signatories to apply his stamped signature to trust account checks. His failure to maintain adequate records and to provide the Director with the necessary books impeded the Director's ability to perform a complete audit.

         Through this conduct, Gorshteyn violated Minn. R. Prof. Conduct 1.15(c)(3), 1.15(c)(4), 1.15(h) as interpreted by Appendix 1, 1.15(j), and 8.4(c).

         Pattern of client misconduct involving unauthorized settlements

         Gorshteyn also committed misconduct involving unauthorized settlement of client claims. Gorshteyn presented at least 13 clients with powers of attorney but failed to explain the purpose or legal implications of these documents. In one instance, Gorshteyn, or someone in Gorshteyn's office, forged the signature of a client on a power of attorney. In that same matter, Gorshteyn failed to obtain a valid contingent fee agreement. On at least two occasions, Gorshteyn presented fee agreements and powers of attorney written only in English to clients who spoke only limited English. And, in one of those instances, he failed to explain a contingent fee agreement to the client.

         Gorshteyn frequently settled or arbitrated cases without the knowledge or consent of the clients.[2] On at least 11 occasions, Gorshteyn entered into settlement negotiations and settled claims without informing his clients or obtaining their consent. Twice, Gorshteyn did not inform his client that he had commenced arbitration proceedings or that an arbitration hearing was taking ...


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