The Ohio Supreme Court today suspended a Hamilton County lawyer for one year, with six months stayed, for several professional conduct violations, including failure to properly oversee a paralegal who embezzled $200,000 from his law office.

In a unanimous per curiam opinion, the Court suspended Edward Kathman of Norwood and conditioned his return to practice on the completion of 24 hours of continuing legal education in professional ethics and law office management. If reinstated, he would be required to serve one-year of monitored probation under an attorney providing guidance in managing personnel and his law office as well as compliance with the rules for managing his client trust account.

Lawyer Provided Minimal Oversight of Paralegal
In 2015, Kathman hired Jillian Gorman as a paralegal, and her job duties were related to Kathman’s personal-injury lawsuit clients. Her job entailed preparing contingent-fee agreements with clients, corresponding with insurance companies on Kathman’s behalf, and collecting information about the clients’ damages and medical expenses. Gorman was not authorized to enter into contingent-fee agreements or sign checks on Kathman’s behalf, but was permitted to write checks to the clients to distribute settlement funds from the client trust account.

Kathman provided little to no oversight of Gorman, providing her a laptop computer and allowing her to work outside of his small office space. The laptop was not linked or networked to the law office’s computer.

In 2017, Kathman discovered that Gorman had written several checks from his client trust account payable to herself. Kathman demanded she return the computer, which he found to be “inoperable,” and he could not recover any data from it. He fired Gorman and reported her to the Norwood police.

Gorman pleaded guilty to one count of theft and one count of forgery. She was sentenced to five years of community control and ordered to pay $200,000 in restitution. As of October 2020, she had paid $2,535.

Client Upset About Missing Settlement Funds
While employed by Kathman, Gorman witnessed an accident in February 2016 in which Jeffrey Welch was injured. She recommended that Welch hire Kathman. Welch recalled meeting with Gorman and Kathman within two week so of the accident, and agreeing to allowing Kathman to represent him.

Kathman maintained that no such meeting occurred. He maintained he never discussed the case with Gorman or Welch until October 2016, and Kathman had no records of representing Welch and no knowledge if information about the case was stored on Gorman’s laptop.

Gorman discussed a $20,000 settlement with Welch and Kathman. In November 2016, Kathman recalled a meeting with Welch where the client signed a release and settlement agreement. Welch subsequently asked Kathman about the status of a $20,000 settlement check issued by an insurance company. Kathman learned that Gorman forged his signature on the back of check.

Welch filed a grievance against Kathman with the Cincinnati Bar Association.

Bar Association Pursues Misconduct Charges
In July 2020, the bar association submitted a five-count complaint against Kathman to the Board of Professional Conduct based on his lack of supervision of Gorman as well as using improper contingent fee agreements, providing improper financial assistance to clients, and various violations of the management of his client trust account.

This was the second time the association sought a Supreme Court sanction of Kathman. In 2001, the Court suspended Kathman for six months for misconduct that included improperly sharing legal fees with a nonlawyer and aiding a nonlawyer in the unauthorized practice of law.

Kathman and the bar association stipulated to several violations of the rules governing the professional conduct of Ohio lawyers. For his lack of oversight of Gorman, Kathman failed to make reasonable efforts to ensure the conduct of a nonlawyer employed by the firm was compatible with his professional obligations.

Kathman suggested he receive an 18 months suspension, all fully stayed, while the bar association proposed he serve a two-year suspension with six months stayed. The board noted that Kathman acted without a selfish or dishonest motive and made good-faith efforts to make restitution and rectify the consequences of his misconduct.

The board recommended the one-year suspension, with six months stayed. The Court agreed, and stated that “Kathman’s failure to supervise Gorman, together with the trust-account violations, and multiple instances of advancing money to clients, warrants an actual suspension, particularly in light of his prior disciplinary offense.”

Kathman also was ordered not to engage in any further misconduct and pay the costs of the disciplinary proceedings.

2021-0216. Cincinnati Bar Assn. v. Kathman, Slip Opinion No. 2021-Ohio-2189.

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