Lawyer in prominent Milwaukee firm faces 60-day suspension (UPDATE)

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A lawyer in a prominent Milwaukee-based law firm faces a 60-day suspension over allegations of misconduct stemming from two divorce cases.

The Office of Lawyer Regulation filed disciplinary charges on June 25 against the Milwaukee attorney Richard Reilly of Gimbel, Reilly, Guerin & Brown, alleging that he had committed five counts of misconduct while representing two clients in divorce proceedings in Ozaukee and Waukesha counties.

Three of the charges stem from Reilly’s representation of a woman in her divorce proceedings in Ozaukee County. Reilly began representing the woman in June 2014, according to the OLR.  Judge Paul Malloy, who entered a divorce judgement in the case in February 2013, had appointed an accounting firm, Scribner Cohen and Co., to manage the woman’s finances. He ordered that her half of her husband’s retirement money should be turned over to the firm and used to pay certain debts.

But Reilly never handed over the more than $97,000 of retirement money that had been deposited into his firm’s trust account after he started representing the client, according to the complaint.

Reilly used some of the retirement money to pay for items not included in his client’s debts, including spa treatments, cleaning services and a plane ticket for one of her children, according to the complaint. With some of the the client’s debts going unpaid, two credit-card companies eventually filed lawsuits against the woman.

Malloy had also called for the title to a 2014 Range Rover to be transferred to the woman and managed by Scribner Cohen. But Reilly never handed the vehicle over and instead used the money to pay a retainer owed to his law firm for defending the woman in a criminal case and paying her bail. The woman was facing felony criminal charges for her alleged attempt to hire a hit man to attack her husband, husband’s girlfriend and Malloy.

Waukesha County Circuit Court Judge Jennifer Dorow, who presided over the post-judgment matters in the case, later found both Scribner Cohen and Reilly in contempt of court and found that Reilly had violated the divorce judgement. She ordered Reilly and Scribner Cohen to pay back the money that had been improperly spent.

Reilly appealed, and the Court of Appeals last year affirmed Dorow’s findings involving Reilly.

The OLR also alleges that Reilly improperly continued to represent the woman in the contempt proceedings even though doing so posed a significant risk that his representation would be materially affected by his personal interest in the contempt proceedings.

The two remaining charges stem from Reilly’s representation of a different woman in a divorce case in Waukesha County. The woman had hired Reilly in May 2013 but later got another lawyer.

During the transition, Reilly failed to deliver his client’s case file to the successor counsel and only allowed the successor counsel to borrow the case file in order to make copies of it at her own expense, according to the complaint, according to the complaint. Reilly also did not include more-than-80 pages of notes and memos he had made. A transcript of a hearing was also missing.

Also according to the complaint, Reilly billed the woman more than $23,000 for his own defense in a bankruptcy-related lawsuit her husband had filed.

The OLR is asking that the Wisconsin Supreme Court suspend Reilly’s license for 60 days and order him to comply with the court order in the Ozaukee County case.

Reilly could not immediately be reached Thursday morning. Peyton Engel of Madison-based Hurley Burish is representing Reilly in the matter.

Engel said Friday that the Ozaukee County divorce was a hotly contested one and that the main contention of the complaint is that Reilly should have handled his client’s money differently.

“Essentially what’s alleged is that Richard paid the wrong debts,” Engel said. “This isn’t about Reilly … stealing money. This is about whether or not he complied with the court’s order. That’s all. ”

Reilly has been licensed to practice law in Wisconsin since 1966. He earned his law degree from the Washington, D.C.-based Catholic University of American Columbus School of Law.

The high court has disciplined Reilly before. He agreed to be privately reprimanded in 1985 for neglecting two estates and not communicating with an heir and in 2004 consented to a public reprimand for failing to file his tax returns on time and failing to thoroughly prepare a divorce client’s case.

Reilly’s license is in good standing, according to the Wisconsin State Bar and OLR websites.

A previous version of this story incorrectly identified Richard Reilly as a partner with Gimbel, Reilly, Guerin & Brown. He is a lawyer at the firm. The Wisconsin Law Journal regrets the error. Follow @erikastrebel