KENTUCKY BAR ASSOCIATION v. MORBURGER (2022)

OPINION AND ORDER

Pursuant to SCR 3.165(1)(a) and (b), the Inquiry Commission of the Kentucky Bar Association (KBA) has petitioned this Court to enter an order temporarily suspending Respondent, Arthur Joseph Morburger, from the practice of law in the Commonwealth of Kentucky. Morburger was admitted to the practice of law in the Commonwealth of Kentucky on November 17, 1961. His KBA number is 49880 and his last known bar roster address is 19 West Flagler Street, Suite 404, Miami, Florida 33130.

The Inquiry Commission asserts there is probable cause to believe Morburger is or has been misappropriating funds for others to his own use or has been otherwise improperly dealing with said funds. The Inquiry Commission further asserts probable cause exists to believe Morburger's conduct poses a substantial threat of harm to his clients or the public. The Inquiry Commission notes there is presently an ongoing disciplinary matter pending against Morburger in Florida for which the Supreme Court of Florida issued an order of emergency suspension from the practice of law on June 16, 2021. Morburger has not responded to this Court's December 21, 2021, order to show cause why he should not be subject to the requested temporary suspension.

In its petition, the Inquiry Commission sets forth the facts underlying its request for a temporary suspension. On June 15, 2021, The Florida Bar filed a petition with the Supreme Court of Florida seeking an emergency suspension of Morburger's license to practice law based on its investigation into allegations of Morburger misappropriating or facilitating the misappropriation of funds he had been court-ordered to hold in his trust account and subsequently making misrepresentations in sworn deposition testimony regarding those funds. Morburger further made misrepresentations in written responses to the bar complaints filed against him.

The complainant was awarded attorneys’ fees in the amount of $37,030 in a case where Morburger was opposing counsel. Morburger was ordered to hold the funds in escrow pending appeal. Those funds represented the only monies held in Morburger's trust account. On February 5, 2021, the day after he was ordered to pay over the fee, Morburger issued a check to the complainant that was subsequently returned for insufficient funds. On March 31, 2021, Morburger issued a second check which was also returned for insufficient funds. Morburger alleged someone had stolen his trust account checks and forged his signature. He purportedly alerted his bank of the thefts and self-reported the incident to The Florida Bar.

The ensuing investigation revealed between February and April 2021, multiple checks were drawn on the trust account payable to GM Investments and Eyal Amitan reducing the balance by $19,000. On April 7, 2021, the complainant accompanied Morburger to the bank where the remaining trust account balance of $18,030 was transferred to the complainant.

In a later deposition, Morburger denied knowledge of GM Investments and insisted the checks had been stolen and forged. It was revealed the president of GM Investments was Morburger's former client who refused to speak to investigators after being so advised by Morburger. Records from Morburger's bank showed no reports of fraudulent transactions as he had previously claimed. The Florida Bar filed its petition seeking emergency suspension and the following day, June 16, 2021, the Supreme Court of Florida entered an order approving the requested suspension. Upon receipt of this information, the Inquiry Commission filed the instant petition.

SCR 3.165(1)(a) permits the Inquiry Commission to petition this Court for an order of temporary suspension if “[i]t appears that probable cause exists to believe that an attorney is or has been misappropriating funds the attorney holds for others to his/her own use or has been otherwise improperly dealing with said funds[.]” Further, SCR 3.165(1)(b) permits temporarily suspending an attorney if “[i]t appears that probable cause exists to believe that an attorney's conduct poses a substantial threat of harm to his clients or to the public[.]” The Inquiry Commission believes the facts set forth above are sufficient to meet this burden in requesting Morburger be suspended pending the outcome of the disciplinary proceedings currently underway in Florida.

This Court has reviewed the uncontroverted allegations of the Inquiry Commission and agrees probable cause exists to believe Morburger is or has been misappropriating funds or has been otherwise improperly dealing with said funds as required by SCR 3.165(1)(a). We further agree a reasonable basis exists to believe Morburger's conduct poses a substantial threat of harm to his clients as required by SCR 3.165(1)(b). Consequently, we agree with the Inquiry Commission that Morburger's license to practice law should be temporarily suspended pending the Florida disciplinary proceedings pursuant to SCR 3.165(1).

ACCORDINGLY, IT IS HEREBY ORDERED as follows:

1. Arthur Joseph Morburger is temporarily suspended from the practice of law in the Commonwealth of Kentucky, effective upon the date of entry of this order, pending further orders from this Court;

2. Disciplinary proceedings against Morburger may be initiated by the Inquiry Commission pursuant to SCR 3.160, unless already begun or unless Morburger resigns under terms of disbarment;

3. Pursuant to SCR 3.165(5), Morburger shall, within twenty (20) days from the date of the entry of this Opinion and Order, notify in writing all clients of his inability to provide further legal services and furnish the Director of the Kentucky Bar Association with copies of all such letters;

4. Pursuant to SCR 3.165(6), Morburger shall immediately, to the extent reasonably possible, cancel and cease any advertising activities in which he is engaged.

/s/ John D. Minton, Jr.

 CHIEF JUSTICE

All sitting. All concur.