DISCIPLINARY PROCEEDING instituted by the Grievance Committee for the Tenth Judicial District. By decision and order on application dated November 22, 2016, this Court authorized the Grievance Committee to institute and prosecute a disciplinary proceeding against the respondent based upon the acts of professional misconduct set forth in a verified petition dated June 21, 2016; directed the respondent to serve and file an answer to the verified petition within 20 days of service upon him of a copy of the verified petition; and referred the issues raised by the verified petition and any answer thereto to the Honorable Patrick A. Sweeney, as Special Referee, to hear and report. The respondent was admitted to the Bar at a term of the Appellate Division of the Supreme Court in the Second Judicial Department on October 1, 1980.
PER CURIAM — The Grievance Committee for the Tenth Judicial District (hereinafter the petitioner) served the respondent with a verified petition dated June 21, 2016, containing four charges of professional misconduct. By virtue of a stipulation executed by counsel for the parties at the pretrial conference held on March 30, 2017, the petition and the respondent’s answer were amended such that the respondent admitted all of the factual specifications supporting the charges. After a hearing conducted on June 29, 2017, the Special Referee filed a report in which he sustained all of the charges. The petitioner now moves to confirm the Special Referee’s report and to impose such discipline as the Court deems just and proper. The respondent cross-moves to grant the petitioner’s motion, and requests that he not be suspended or removed from the practice of law.The Petition As AmendedCharge one alleges that the respondent misappropriated escrow funds entrusted to him as a fiduciary, in violation of rule 1.15(a) of the Rules of Professional Conduct (22 NYCRR 1200.0), as follows:The respondent maintained an attorney trust account at HSBC Bank entitled “Ira Podlofsky Esq Attorney Special IOLA Account,” account number ending 925-9 (hereinafter the trust account). In or about 2008, the respondent, as the attorney for the plaintiffs, commenced a medical malpractice action entitled Klein v. Argoff in the Supreme Court, Nassau County, under Index No. 9065/2008. In or about 2010, a settlement was reached with the defendant Central Island Health Care in the sum of $200,000 (hereinafter the Central Island settlement). In or about 2010, a settlement was reached with the defendants Charles E. Argoff and North Shore University Hospital in the sum of $150,000 (hereinafter the Argoff/North Shore settlement). The plaintiffs discontinued the action against the remaining defendants.Between on or about December 21, 2010, and in or about March 2011, the respondent received payments totaling $135,310.68 from the insurance carrier for Central Island, which he deposited into the trust account. These funds represented the Central Island settlement minus a medicare reimbursement, which payment was made directly to Medicare CMS by the insurance carrier. By March 18, 2011, the respondent had disbursed all funds related to the Central Island settlement from the trust account.Pursuant to a hold harmless agreement dated on or about May 10, 2012, the respondent agreed to hold $25,000 of the $150,000 Argoff/North Shore settlement in escrow pending final payment of a Medicare lien. In or about June 2012, the respondent received the Argoff/North Shore settlement funds from Physicians Reciprocal Insurers by two checks, one in the sum of $25,000 and the second in the sum of $125,000. Both settlement checks were made payable to Barry Klein, Harriet Klein, and the respondent. On June 8, 2012, the respondent deposited both checks into the trust account.Within days of the deposit of the Argoff/North Shore settlement checks, the respondent issued trust account check no. 1929 to himself in the sum of $44,761 for fees/expenses, and that check cleared on June 13, 2012. On June 14, 2012, the respondent issued trust account check no. 1930 in the sum of $80,240 to Harriet Klein, which represented the clients’ share of the Argoff/North Shore settlement, less the $25,000 Medicare lien. Check no. 1930 did not clear the respondent’s trust account until December 4, 2012. Between June 13, 2012, and December 4, 2012, the respondent was required to maintain and preserve a minimum of $105,240 in his trust account, representing the $80,240 check (no. 1930) issued to Harriet Klein but not yet negotiated, and the $25,000 for the Medicare lien. During this period, the balance in the trust account fell below $105,240 as follows:DateBalanceSeptember 24, 2012$103,372.76September 28, 2012$103,385.52October 5, 2012$103,340.90October 31, 2012$103,354.92
