BRUCE W. BLACK, Bankruptcy Judge.
Before the court for decision is an Attorney Disciplinary Proceeding brought pursuant to Local Bankruptcy Rule 9029-4B.
This proceeding is brought pursuant to Local Bankruptcy Rule 9029-4B. After being approved by the District Court, the rule became effective on January 1, 2012. It is authorized by, and promulgated pursuant to, Federal Rule of Civil Procedure 83 and Federal Rule of Bankruptcy Procedure 9029. Further authority for this rule is found in section 105(a) of the Bankruptcy Code
Pursuant to Local Bankruptcy Rule 9029-4B(B), two judges of this court, Eugene R. Wedoff and Pamela S. Hollis, filed a complaint with the undersigned chief judge against Mr. Liou on February 13, 2012. The complaint was considered by the judges of this court who determined by majority vote that a formal disciplinary proceeding should be commenced. A Statement of Charges was filed on March 21, 2012, and the proceeding was assigned to the undersigned judge for hearing. Mr. Liou filed his answer on April 18, 2012. The United States Trustee accepted the court's appointment to investigate and prosecute the charges. An Amended Statement of Charges ("ASC") was filed on July 19, 2012, and Mr. Liou's answer was filed on August 17, 2012.
An evidentiary hearing was conducted, and on January 31, 2013, the court announced its conclusions that the United States Trustee had proved by clear and convincing evidence
In April of 2013 an evidentiary hearing was held regarding the appropriate sanctions for Mr. Liou's conduct. The issues have been thoroughly briefed and argued. This opinion will address the issues presented in both evidentiary hearings.
Several opinions by members of this court have addressed Mr. Liou and his fee practices. In re Jackson, 401 B.R. 333
Id. (emphasis in the original) (citations and footnotes omitted).
In In re Nelson, 424 B.R. 361 (Bankr. N.D. Ill. 2009), the court ordered Mr. Liou to disgorge as unreasonable $3,290 of $5,290 received from the debtors. The court concluded that the Rule 2016(b) disclosure statement was unacceptably misleading and that the fee agreement was "so unclear it will be cancelled pursuant to section 329(b)." Id. at 365. The court also touched on Mr. Liou's lack of candor in responding to the trustee's 329 motion:
Id. at 367.
In In re Brent, 458 B.R. 444 (Bankr. N.D. Ill. 2011), the court decided 317 orders
Most recently, in In re Maldonado, 483 B.R. 326 (Bankr. N.D. Ill. 2012), after a Section 329 hearing, Mr. Liou was ordered to disgorge $2,768.77 in fees to the chapter 13 trustee to be used to fund the debtor's plan. Id. at 328.
Section II of the ASC sets forth the applicable disciplinary rules. The applicable rules regarding conflicts of interest and candor to the court are the District Court Local Rules 83.51.7 and 83.53.3 until June 2, 2011
Paragraph 22 of the ASC charges Mr. Liou with violating District Court Local Rule 83.51.7 and ABA Model Rule 1.7 ("Conflict of Interest Rules")
Paragraph 23 of the ASC charges Mr. Liou with violating the Conflict of Interest Rules
Paragraph 24 of the ASC charges Mr. Liou with violating the Conflict of Interest Rules
Paragraph 25 of the ASC charges Mr. Liou with violating the same rules
Paragraph 26 of the ACS charges Mr. Liou with violating District Court Local Rule 83.53.3 and ABA Model Rule 3, 3 ("Candor Rules")
Paragraph 27 of the ASC charges Mr. Liou with violating the Candor Rules "by filing false statements of financial affairs with the court and failing to correct the false statements in most cases."
Paragraph 28 of the ASC describes the nominal assignment procedure involving Kurt Kolar (See Stipulated Facts 18-20) as "a subterfuge, designed to conceal from the court the true holder of the claim." The paragraph charges Mr. Liou with violating the Candor Rules "by filing with the court knowingly false assignments with the intent to conceal the true recipient of the proceeds paid on claims to which those assignments related."
Paragraph 29 of the ASC charges Mr. Liou with violating the Candor Rules
Paragraph 30 of the ASC charges Mr. Liou with violating the Candor Rules
Paragraph 31 of the ASC charges Mr. Liou with violation of the Candor Rules
Most of the facts are undisputed. Section II of the Amended Joint Pre-trial Statement, filed on January 10, 2013, contains forty-seven Stipulated Facts. Many of these facts are taken from the dockets of bankruptcy cases filed in this district. Even in the absence of stipulations, the court can take judicial notice of matters in its own records. Griffin v. United States, 109 F.3d 1217, 1218 n. 1 (7th Cir. 1997).
The Stipulated Facts are as follows, quoted verbatim except for material in brackets:
1. [Mr. Liou] has been licensed to practice law in the State of Illinois since 1995.
2. [Mr. Liou] began filing bankruptcy cases as an attorney for debtors in 1996, and his practice became focused in the bankruptcy area in 1997.[His] bankruptcy practice is focused exclusively on consumer debtor representation in cases under Chapter 7 and Chapter 13 of the Bankruptcy Code.
3. As time passed, [Mr.] Liou came to represent clients who were filing their second, third, fourth, or fifth bankruptcy petition through his office. In some of these cases, the debtors owed [him] outstanding attorney's fees from a prior Chapter 13 case or cases ("Prior Fees") that had been dismissed before the attorney fees were paid in full.
4. [Mr.] Liou solicited and accepted payment of Prior Fees from debtor clients before filing a subsequent case for that client. [He] solicited and accepted these payments knowing that the client intended to file a new bankruptcy case, and, in some instances, within 90 days of the new filing.
5. [Mr.] Liou did not disclose to the clients from whom he accepted payments for Prior Fees prior to commencing a new case, that his collection of Prior Fees posed, as alleged in the Amended Statement of Charges, a potential conflict of interest.
6. [Mr.] Liou did not obtain a written waiver from his clients of the potential conflict of interest posed, as alleged in the [amended] Statement of Charges, by his collection of Prior Fees prior to commencing a new case.
7. [Mr.] Liou did not obtain an oral waiver from his clients of the potential conflict of interest posed, as alleged in the [amended] Statement of Charges, by his collection of Prior Fees prior to commencing a new case.
8. On June 26, 2012, the U.S. Trustee served a subpoena upon [Mr.] Liou requesting, inter alia, "[c]opies of any and all records evidencing receipt of payments on account of past-due attorney fees." In response to this request, [Mr.] Liou produced the 69 pages of documents offered as U.S. Trustee Exhibit 49 (the "Past Due Documents").
9. The Past Due Documents evidence [Mr.] Liou's collection of Prior Fees in the [forty cases listed on Appendix A].
10. The Past Due Documents do not evidence all instances in which [Mr.] Liou solicited and accepted payment for Prior Fees from a client before filing a new bankruptcy case for that client.
11. In the [thirty-five cases listed on Appendix B], [Mr.] Liou was owed attorney fees when a debtor's case was dismissed. [He] thereafter filed a subsequent
12. In instances where [Mr.] Liou did not collect all Prior Fees in advance of the filing of the subsequent case, he sometimes sought to collect payment through the filing of a proof of claim in that subsequent case.
13. Beginning in 2001, and continuing into 2010, [Mr.] Liou filed proofs of claim for Prior Fees in cases in which he served as debtor's counsel. The proofs of claim stated that Kurt Kolar was the holder of the claim.
14. The proofs of claim sometimes included an additional amount over and above the principal amount due. The parties disagree as to whether such additional amount was (a) interest or (b) a late charge.
15. Typically, the aforementioned additional charge was calculated as 9 or 18% of the principal amount owed.
16. In In re Ezell, Case No. 04-41448 the aforementioned additional charge was imposed notwithstanding that Prior Fees had not been awarded by Court Order in the earlier case.
17. Proofs of claim for Prior Fees were filed in the [thirty-five cases listed on Appendix C].
18. In some instances, the proofs of claim were accompanied by a document which, on its face, assigned the claim for Prior Fees from [Mr.] Liou to Kurt Kolar for consideration of $10.00.
19. Kolar paid no consideration to [Mr.] Liou in connection with the assignments referenced in Paragraph 18, above, and never retained any payments with respect to claims for Prior Fees filed under his name. [Mr.] Liou received all payments, to the extent payments were made by the Chapter 13 Trustee, on each of the proofs of claim referenced in Paragraph 17, above.
20. At first, Kolar endorsed the checks received from the Chapter 13 trustee directly to [Mr.] Liou. Later, after [Mr.] Liou informed Kolar that his bank would no longer accept the checks endorsed over to him, Kolar deposited the checks into his client funds account and wrote a check in the same amount to [Mr.] Liou.
21. [Mr.] Liou did not receive written conflict waivers from any of his clients against whom he filed a proof of claim.
22. From the beginning of his practice until early 2009, in general, [Mr.] Liou's clients' Statements of Financial Affairs response to Question 9 was "none," irrespective of whether that answer was accurate.
23. [Mr. Liou] testified at the November 14, 2011 hearing in In re Simelton, No. 10-22771, that before he had clients who were returning to file second cases through his office, [he] did this because he believed the same information was already disclosed in the 2016(b) disclosure statement. [Mr. Liou] further testified that, after he began to receive Prior Fees, through inattention and by default, the program he used to complete the SOFA, without any intervention, defaulted to a check-mark in the "none" box.
24. [Mr.] Liou continued to file inaccurate Statements of Financial Affairs in some instances after he was criticized for these inaccuracies in the In re Joe Jackson, Case Nos. 07-18515 and 08-20776, [401 B.R. 333 (Bankr. N.D. Ill. 2009)]
25. Liou Law Firm is a sole proprietorship. [Mr.] Liou is, and always has been, Liou Law Firm's proprietor.
26. The [thirteen] bank accounts [listed on Appendix D] are accounts that are either in the name of Liou Law Firm or
27. Since 1997, [Mr.] Liou has filed roughly 8,000 bankruptcy cases in the Northern District of Illinois.
28. To operate the Liou Law Firm, [Mr.] Liou engaged licensed attorneys.
29. These attorneys met with [Mr.] Liou's clients, prepared bankruptcy papers on behalf of [Mr.] Liou's clients, and, in some cases, appeared in Court on behalf of [his] clients.
30. [Mr.] Liou is the only counsel of record in each case filed through his firm. Although a client may meet with an attorney other than [Mr.] Liou, all cases emanating from the Liou Law Firm are filed through [Mr.] Liou's ECF account.
31. Matthew Baysinger is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Baysinger to provide legal services to [Mr.] Liou's clients between approximately December of 2011 and July of 2012.
32. Scott Zale is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Zale to provide legal services to [Mr.] Liou's clients between approximately February of 2011 and January of 2012.
33. Roland Schlosser is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Schlosser to provide legal services to [Mr.] Liou's clients between approximately April 2004 and April 2009.
34. William Georgakis is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Georgakis to provide legal services to [Mr.] Liou's clients between approximately March 2009 and July 2010.
35. Jessica Naples is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Naples to provide legal services to [Mr.] Liou's clients between approximately March 2011 and October 2011.
36. Rocio Herrera is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Herrera to provide legal services to [Mr.] Liou's clients between approximately November 2010 and January 2011.
37. Brian Deshur is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Deshur to provide legal services to [Mr.] Liou's clients between approximately June 2008 and October 2008.
38. David Lugardo is an attorney licensed to practice law in Illinois. [Mr.] Liou engaged Lugardo to provide legal services to [Mr.] Liou's clients between approximately November 2007 and June 2008.
39. Dipali Patel is an attorney licensed to practice law in Illinois. Dipali Patel was an employee of [Mr.] Liou and/or the Liou Law Firm between 2002 and 2011.
40. Until 2002, [Mr.] Liou generally made all determinations as to the attorney fee a client would be charged in a particular case. Thereafter, in some instances when [he] was away from the office, Dipali Patel, and then Roland Schlosser were given authority to set fees. In a few Chapter 13 cases in 2012, Matthew Baysinger determined the down payments without [Mr. Liou's] involvement.
41. From approximately the year 2000 to the present, it has been [Mr.] Liou's general practice to file Chapter 7 cases only when a client was able and willing to pay the entire attorney fee at the outset.
42. [Mr.] Liou filed Chapter 13 cases for the [forty debtors listed on Appendix E] who were below the applicable median-income, had no property on Schedule A, had no non-exempt property on Schedules B and C, had no secured debts on Schedule
43. At a point prior to October 21, 2009, [Mr.] Liou developed what he refers to as the "Directives Page." These Directives Pages were generally given to clients prior to their bankruptcy filing and instructed them on matters such as when to return to the Liou Law Firm and the amount of payment that needed to be remitted before their case would be filed.
44. In many Chapter 13 cases in which [Mr.] Liou used the Directives Page, he filed Applications for Compensation with the Court indicating that he had entered into the Court-Approved Retention Agreement with the client(s).
45. [Mr.] Liou did not disclose the existence of the Directives Pages in his Applications for Compensation and did not file the Directives Pages with the Court.
46. [Mr.] Liou is the 100% shareholder of FILENOW.COM INC., an entity incorporated under the laws of Illinois on November 29, 2005.
47. FILENOW.COM owns a website of the same name and serves as assignee of certain claims for Prior Fees owed to [Mr.] Liou that are pursued in state court.
The parties also agreed in the Amended Joint Pretrial Statement to the admissibility of most of the exhibits offered. The United States Trustee's exhibits (USTX) 1 through 27, 29, 32 through 34, 42, 44 through 51, 55, 60, and 61 were all admitted without objection. (There were no USTX's 28, 35 through 41, and 43 when the pretrial statement was prepared.) During the hearing, the objections to USTX's 30, 31, and 56 through 58 were withdrawn. USTX's 62 through 78 were admitted without objection.
Ultimately, Mr. Liou objected only to USTX's 52, 53, 54, and 59. USTX's 52 and 53 were parts of Mr. Liou's federal income tax returns for the years 2008 through 2010. The parties briefed the issue, and the court ultimately sustained the objection. (TX 1311)
USTX 54 consists of bank records of FileNow.com, an entity wholly owned by Mr. Liou. (Stipulated Fact 46) The relevance objection is overruled, and the exhibit is admitted. USTX 59 consists of several opinions concerning Mr. Liou's fees. Mr. Liou's objection was overruled during the hearing (TX 234) and is the subject of footnote 4 above. All of Mr. Liou's exhibits have been admitted.
The United States Trustee presented seventeen witnesses, including Mr. Liou. One was an employee of the United States Trustee's Office. Another was Mr. Olivadoti, an attorney for one of the Chapter 13 Standing Trustees. Ten were former clients of Mr. Liou. Four were former employees of Mr. Liou. The court finds that all of these witnesses, except Mr. Liou, were credible.
Mr. Liou presented four witnesses in the first phase of the hearing: Mr. Liou himself, an attorney who does collection work for him, and two clients, Ms. Robin Ross-Aikins and Ms. Gwendolyn Williams-Pettis. Of these witnesses, only the collection attorney was credible.
In the second phase of the hearing, the United States Trustee only called Mr. Liou. Mr. Liou again testified on his own behalf and presented three character witnesses.
At the outset, it is important to note the fiduciary duties between an attorney
Turning to the charges set forth in the ASC, the charges in paragraphs 22, 24, and 25 are factually interrelated. All three relate to Mr. Liou's practice of collecting unpaid fees from clients for whom he was filing a subsequent case. (Stipulated Facts 3, 4) He used two methods to collect the prior fees. First, he insisted that any prior fees owing be paid before the new case would be filed. Second, if the first method failed, he would file a claim for the prior fees in the new case. (TX 34) The Conflict of Interest Rules prohibit a lawyer from representing a client if there is a "significant risk" that the representation will be "materially limited" by a personal interest of the lawyer. Both rules require that the attorney obtain informed consent from the client in order to continue the representation notwithstanding the conflict.
Although the potential conflict between Mr. Liou's interests as a creditor and the clients' interests as debtors seems obvious, Mr. Liou has testified that he did not believe there was an actual conflict of interest created when he pursued the prior fees. (TX 931) He has also testified that he always discussed the potential conflict with the clients against whom he filed a proof of claim who then elected to proceed with Mr. Liou representing them. (TX, 57-58, 122, 939) Mr. Liou's testimony about his conflict discussions with his prior fee clients is not credible for several reasons. First, Mr. Liou has admitted that he had no conflict discussions with prior fee clients who paid him before he filed their subsequent cases. (Stipulated Facts 5, 6, and 7)
Second, none of the former clients called by the United States Trustee recalled such a conversation when asked, and none could articulate the potential conflict of interest. (Harlin—TX 398-399; Wynn TX—414; Ezell—TX 443, 475; White—TX 488-489; Simon—TX 505; Cedeno—TX 671)
Third, neither of the two clients called by Mr. Liou on this point—Ms. Robin Ross-Aikins and Ms. Gwendolyn Williams-Pettis—offered credible testimony to support Mr. Liou's testimony. Ms. Ross-Aikins's testimony was entirely not credible. She was clearly coached before testifying. For instance, in the first minute of her testimony, in response to a question about the outcome of her first case in 2004 with Mr. Liou, she volunteered that she remembered Mr. Liou talking to her about a conflict of interest. (TX 587) She also purported to remember the name Kurt Kolar from that conversation (TX 589), but she was unable to articulate the conflict of interest despite Mr. Liou allegedly explaining it to her repeatedly. (TX 621, 628) Mr. Liou currently represents Ms. Ross-Aikins in a pending chapter 13 case.
Fourth, the four witnesses who had worked for Mr. Liou clearly contradicted his testimony. Ms. Dipali Patel worked with Mr. Liou from 2002 until April of 2011. (Stipulated Fact 39) She testified that she recalled only one discussion of a conflict of interest, that when a couple filed a joint chapter 13 case while in the process of a divorce. (TX 841) Mr. Scott Zale, who worked for Mr. Liou between approximately February of 2011 and January of 2012 (Stipulated Fact 32), remembered no discussions about conflicts of interest regarding prior fees. (TX 651) Mr. Matthew Baysinger, who worked for Mr. Liou between approximately December of 2011 and July of 2012 (Stipulated Fact 31), testified that they began advising prior fee clients of the potential conflict of interest during the time that he worked for Mr. Liou. (TX 551) Finally, Ms. Sylvia Valdez testified that she worked for Mr. Liou as a paralegal from August of 2010 until October of 2012. She frequently served as an interpreter because none of the attorneys spoke Spanish. She testified that she never translated a conversation about a conflict of interest. (TX 973) These four witnesses were entirely credible, and their testimony clearly establishes the falsity of Mr. Liou's testimony on this issue.
Even if Mr. Liou were telling the truth about discussing conflicts of interest with clients from whom he was collecting prior fees, his version of the conversations would not be sufficient to allow the court to conclude that the clients had given informed consent to the representation. (See, e.g., TX 124) Both Conflict of Interest Rules define the disclosure necessary to obtain the client's consent to the attorney's continued representation despite the potential conflict. District Court Local Rule 83.50.2(4) states: "`Disclose' or `disclosure' denotes communication of information reasonably sufficient to permit the client to appreciate the significance of the matter in question." ABA Model Rule 1.0(e) states:
Mr. Liou testified four times in this proceeding—for each party in both hearings. He had previously testified before Judges Hollis (USTX 33), Wedoff (USTX 29), and Schmetterer. (USTX 32) He never once testified that he told a client that his prior fees claim was subject to discharge in bankruptcy. He never once testified that he told a client that any payments made to him within 90 days of filing the new case could be set aside as preferences. (Indeed, Mr. Liou testified that he was unaware of the preference problem until Judge Wedoff explained it to him in April of 2011. (TX 930, 1404)) Without such specific explanations, the court concludes
Furthermore, even Mr. Liou's purported current practice of obtaining written waivers of the prior fee conflict of interest (TX 938) does not produce an effective waiver. What he refers to as the written waiver is a paragraph in his so-called "Directives Page." (Stipulated Fact 43) But the paragraph in question is conclusory, stating only "You understand this potential conflict of interest" (USTX 51, p. 4) or "You understand the potential conflict of interest as it has been more fully explained to you." (Id. at 11) An effective waiver is one which comports with the Conflicts of Interest Rules. This conclusory paragraph does not provide the client with adequate information or an explanation of the material risks of or alternatives to the waiver. Therefore, these written waivers are not sufficient for informed consent as required by the Conflict of Interest Rules.
Given Mr. Liou's fee collection practices, the court concludes that there was clearly a significant risk that Mr. Liou's representation of these debtors would be materially limited by his personal interests. Mr. Liou could not have reasonably believed otherwise. He was required to obtain the informed consent of his clients to continue his representation but failed to do so. Consequently, this charge has been proved.
The charge in paragraph 23 of the ASC is that Mr. Liou failed "to disclose a potential conflict to his clients and by failing to obtain effective consent from his clients waiving a concurrent conflict of interest with respect to his advising them to file for Chapter 13...." In his answer to this charge, Mr. Liou denies that he improperly counseled clients to file chapter 13 cases. He does not state that he made any disclosure to them regarding the potential conflict. (Answer, pp. 8-9, 26)
The United States Trustee has produced conclusive evidence to support the charges that Mr. Liou counseled clients to file chapter 13 cases when chapter 7 would have served their interests better. USTX 3(a) lists forty cases filed by Mr. Liou for debtors who were below the applicable median income, had no real property on Schedule A, had no non-exempt property on Schedules B and C, had no secured debts on Schedule D, and had no parking tickets on Schedule F. (Stipulated Fact 42) Thus, many of the usual reasons for filing under chapter 13 instead of chapter 7 are not present in those cases. For example, many chapter 13 cases are filed to allow the debtor to retain a home or a vehicle subject to secured loans in default. Also, debts for unpaid parking tickets are dischargeable in a chapter 13 case but not in a chapter 7 case. In re Gallagher, 71 B.R. 138, 139 (Bankr. N.D. Ill. 1987). USTX 3(a) is strong evidence that Mr. Liou filed many cases under chapter 13 rather than chapter 7 to further Mr. Liou's interests in collecting more fees even though chapter 13 was not in the best interests of the debtors.
In most of these cases, there appears to be no valid reason for choosing chapter 13, and Mr. Liou has not even tried to justify the filing. For example, in In re Williams, No. 06 B 04978, (TX 81-97) the debtor was a seventy-five year old man suffering from Alzheimer's disease with
In In re Dorothy Radcliff, No. 08 B 05795, at least one of Mr. Liou's reasons for filing a chapter 13 case was the result of his mistaken belief that tuition debt, like student loan debt, is generally non-dischargeable. (TX 1034) He also testified that the debtor did not want to file another chapter 7 case. (TX 1035) But on cross-examination, he was not certain when he met with her. (TX 1163) This testimony tends to refute Mr. Liou's other testimony that he filed chapter 13 cases based on his clients' wishes.
Ms. Radcliff's case also calls into question Mr. Liou's position that significant student loan debt justifies a chapter 13 filing. Her student loan debt was $6,028 out of a total debt of $9,180. She completed a 53-month plan, paying $80 per month. Of the $4,240 paid into the plan, Mr. Liou received $3,008.47, the entire amount of attorney's fees owed, plus $500 which he received prior to filing this case. Creditors received less than $1,000. Ms. Radcliff paid $4,740 to discharge $2,230.83 in unsecured debt and was still left with student loan debt of $5,306. (D.E. 27 in 08 B 05795) Mr. Liou could not explain why the plan term was 53 months rather than 60 months, given his position that a chapter 13 in such cases was buying the debtor time. (TX 1167) Mr. Liou appears to have been the only winner here—receiving 82.7% of the plan payments.
In further support of this charge, the United States Trustee presented testimony from several of the debtors and from Mr. Liou. Mr. Liou was also questioned by his attorney about this issue. His attorney asked whether his firm made more money in a chapter 13 case than in a chapter 7 case. He said, "Total dollar amount, yes, but dollar-per hour wise, more than likely no." (TX 992) He also testified that he would typically let the client decide which chapter to file. (TX 996) Mr. Liou then testified about his office procedures which included explaining the difference between chapter 13 and chapter 7. On direct examination by his attorney, he addressed several specific cases and explained why certain debtors chose chapter 13 over chapter 7, giving the impression that he personally spoke to each debtor. On cross-examination, he could not remember whether he spoke with each debtor or whether he had testified from notes made by others. Ultimately, Mr. Liou's explanation for many of those decisions was simply that the client wanted to file chapter 13. (Joseph Williams—TX 88, 91; Dumas—TX 1021; Gandy—TX 1022; Johnson—TX 1027-28; Negron—TX 1032, Stamps—TX 1035)
Some of Mr. Liou's explanations were at least plausible. (Adams—TX 1013 food—stamp overpayments; Almanza—TX 1018—student loans; Diggs—TX—1019— student loans; Gilmore TX 1024—student loans; Lynumn—TX 1028—repossessed car; Holmes—TX 1025—payday loans; Matthews—TX 1031—payday loans)
Other explanations were not at all plausible. These include the cases cited above in which Mr. Liou testified that the clients wanted to file chapter 13. In addition, Mr. Liou's testimony regarding why Ms. Annie Holmes (TX 1037-44) and Ms. Gloria Porter (TX 1044-48) elected to file under chapter
Mr. Liou's statement that chapter 13 cases are probably not more lucrative than chapter 7 cases is also refuted by the evidence. First, Mr. Liou's chapter 13 clients were often not just charged a single flat fee. They were charged several, one for each case. Most of the former client witnesses were unsure how many cases had been filed for them. (Harlin— TX 392; Ezell—TX 433; White—TX 484, 509; Avila—TX 579, 583-84, Holmes—TX 753-754) Some did not even know why their first case had ended. (Wynn—TX 408-409; White—TX 486; Holmes—TX 758) Second, in many of the cases listed on USTX 3(a), Mr. Liou was far and away the greatest beneficiary of the chapter 13 plan, receiving the largest portion of the plan payments. (Radcliff—71%—TX 1166; Johnson—67%—TX 1169; Diggs— 50%—TX 1170; Jimmie Holmes—93%— TX 1173; Stamps—47%—TX 1175; Adams—60%—TX 1177; Gilmore—94%— TX 1183; Gandy—71%—TX 1187)
Even in some cases when he may have had a plausible reason for filing a chapter 13 case, Mr. Liou's treatment of these cases is more consistent with generating his fees than in serving the asserted interest of his client. Mr. Liou testified that the main advantage of filing under chapter 13 for a debtor with significant student loans is to buy time. (TX 1162) That would suggest that plans should last the maximum time of sixty months, for the maximum benefit of the debtor. They often did not—but they did last long enough for Mr. Liou's fees to be paid. Furthermore, Mr. Liou was not aware of section 523(a)(8) which provides a hardship discharge specific to student loan debtors. (TX 1160) That fundamental lack of knowledge suggests he was more concerned with his own financial interests than with the best interests of his clients.
There are, of course, many legitimate reasons for filing a chapter 13 case. These include a desire by the client to pay his or her creditors some portion of the amount owed. At some point, however, an attorney has an obligation to counsel a client that chapter 7 is preferable. Simply explaining differences between the two chapters, and leaving the choice to the clients is not sufficient to support the attorney's obligation to secure effective consent under the Conflict of Interest Rules. The United States Trustee has proved this charge.
Paragraphs 26 and 27 of the ASC charge Mr. Liou with violating the Candor Rules by filing false documents—SOFAs which indicated that the debtors had received no payments in the previous year regarding bankruptcy—and failing to correct them. Mr. Liou does not dispute what happened. (Stipulated Facts 11, 22-24, and Answer to the ASC, D.E. 22, p. 3) His defense is that the false filings were not done with the intent to deceive. (Id. at 5-8, TX 1064) Even assuming that his defense is true, Mr. Liou had the obligation under the Candor Rules to correct these false statements.
Paragraph 29 of the ASC charges Mr. Liou with filing false assignments of his claims for prior fees with the intent to conceal the true recipient of the proceeds. Once again, Mr. Liou does not dispute what he did. (Stipulated Facts 12, 13, 18-21; TX 1106-1122) He simply asserts that he did so in good faith. (Answer, pp. 9-13) He has repeatedly testified that the practice began when an attorney for one of the Chapter 13 Standing Trustees, Anthony Olivadoti, objected to Mr. Liou filing the claims in his own name. (USTX 29(c), pp. 39-41; TX 1113) Mr. Olivadoti has repeatedly testified to the contrary. (USTX 29(c), p. 25; USTX 29(d), p. 29; TX 883-84) The court believes Mr. Olivadoti and rejects Mr. Liou's testimony. Mr. Liou deliberately and in bad faith filed false assignments. This charge has been proved.
The next issue is closely connected to the preceding one. Paragraph 29 of the ASC charges that Mr. Liou gave false testimony under oath at the March 31, 2011, evidentiary hearing in In re Simelton, No. 10 B 22771, before Judge Wedoff. The transcript of that hearing was attached to the ASC and also has been admitted into evidence as USTX 29(b). The hearing concerned the reasonableness of Mr. Liou's fees under section 329.
Mr. Liou testified that he had a professional relationship with Attorney Kurt Kolar whereby Mr. Kolar collected unpaid fees owed to Mr. Liou pursuant to a contingency fee agreement. The contingency fee agreement provided that Mr. Kolar would keep twenty-five percent of what he collected and would remit seventy-five percent to Mr. Liou. (USTX 29(b), pp. 9-11)
The questioning moved to Mr. Liou's practice of filing claims for his prior unpaid fees in subsequent cases he filed for the same debtor, sometimes filing the claim in the name of Mr. Kolar. (See generally Stipulated Facts 11-20) The proof of claim in the Simelton case had been admitted as an exhibit at the March 31, 2011 hearing and is USTX 1(ii) herein. Under questioning by Mr. Jeff Snell, an attorney for the United States Trustee, the following exchange took place:
(USTX 29(b), pp. 31-32)
Later in the same hearing, Mr. Kolar testified that he paid all the money received pursuant to the assigned claims to Mr. Liou. (Id. at 43)
The hearing was then continued to the following Monday, April 4, 2011. A transcript of that hearing is USTX 29(c). At the April 4, 2011, hearing, Attorney Steven M. Shebar appeared on behalf of Mr. Liou. During that hearing, under questioning by Mr. Shebar, Mr. Liou testified as follows:
(USTX 29(c), p. 52)
On cross examination by Mr. Snell, the following exchange took place:
(Id. at 74-76)
Mr. Liou defends this charge by asserting that when looking at the complete testimony given on March 31 and April 4 of 2011, it is irrational to conclude that he lied about the assignments of Prior Fees. (Answer, p. 4) This argument is later expanded to essentially say that Mr. Liou was confused and suffered from "a severe sinus infection" and failed to shift his focus from the "boiler plate ten dollar consideration recital." (Id. at 13-15) Mr. Liou has repeated this defense while testifying in this hearing. (TX 359-368, 1122-1135)
The court has read and re-read both transcripts, and the court categorically rejects Mr. Liou's argument. Whether it was "rational" for Mr. Liou to lie to Judge Wedoff or not, this court concludes that he did so intentionally and knowingly. This charge has been proved.
Paragraph 30 of the ASC charges Mr. Liou with violating the Candor Rules by falsely stating that he had complied with the CARA when in fact he did not personally meet with each debtor as the agreement requires. Mr. Liou responds that he delegated some of the duties required by the CARA to attorneys on his staff. (Answer, pp. 15, 33) Mr. Liou is the only attorney in his firm who appears of record in cases filed by the firm. (Stipulated Facts 28-30) Although the court has reservations about the wisdom of this policy, the court concludes that because he reasonably believed it was proper to delegate duties to his attorney subordinates, he did not knowingly make the false statements alleged. Thus, this charge has not been proved.
Similarly, Paragraph 31 of the ASC charges Mr. Liou with violating the Candor Rules by falsely stating that he had complied with the CARA when in fact he had modified the agreement with a "Directives Page." (Stipulated Facts 43-45) Mr. Liou responds that, when properly understood, the "Directives Page" does not modify the CARA. (Answer, pp. 15, 33-34) Again, the court concludes that Mr. Liou's use of the "Directives Page" did not amount to a knowing violation of the CARA. Thus, the charge has not been proved.
The United States Trustee has proved the specific charges in Paragraphs 22-29 of the ASC by clear and convincing evidence. "The purpose of attorney disciplinary proceedings is not to punish the attorney, but rather protect the public, maintain the integrity of the legal profession, and protect the administration of justice from reproach." In re Winthrop, 219 Ill.2d 526, 302 Ill.Dec. 397, 848 N.E.2d 961, 981 (2006). The court may consider aggravating or mitigating circumstances prior to imposing discipline. Id. The court
The United States Trustee has proved that Mr. Liou's policies and practices victimize his clients in many ways. His clients trust him and return to him for subsequent cases even though they should not. It is common knowledge among bankruptcy judges that many debtors are only concerned whether they can afford the monthly payment, without regard to long term consequences. Bankruptcy judges see this with chapter 13 plans as well as with reaffirmation agreements that make no economic sense. Mr. Liou exploits this short-sightedness. There is simply no other explanation as to why Ms. Robin Ross-Aikins returned to Mr. Liou for six cases, in which he charged her a total of $13,200, or why other clients of Mr. Liou did not complain about the addition of prior fees to their subsequent cases.
Nearly two years ago in In re Brent, Judge Goldgar observed that "Liou's moral compass badly needs repair." 458 B.R. at 463. Based on the evidence herein, the court questions whether Mr. Liou has a moral compass. Despite Mr. Liou's testimony about being motivated to help debtors, the evidence indicates his primary motivation is to collect as much money as possible from his clients, and he is either unable or unwilling to recognize any ethical or moral restraints. A partial list of his shortcomings follows.
First, the court's conclusion that Mr. Liou intentionally lied to Judge Wedoff while under oath obviously colors all of Mr. Liou's testimony. His testimony is not worthy of belief.
Second, Mr. Liou apparently coached Ms. Ross-Aikins regarding her testimony in this proceeding. Her testimony was not credible, and Mr. Liou admitted talking with her several times before the hearing. (TX 205-209)
Third, Mr. Liou's practice of charging "late fees" or "interest" (Stipulated Facts 14-16) is beyond simple over-reaching. It is totally unsupportable. Not only did Mr. Liou charge either nine or eighteen percent for late payments, he did not wait until the payments were late. (TX 194, 942-45) He also calculated the charges from the date the client signed the fee agreement, even for the period before the case was filed.
Fourth, the court believes that USTX 46(b) provides insight into the true character of Mr. Liou that stands in stark contrast to the opinions expressed by the defense character witnesses. The computer note made by Mr. Liou and furnished in discovery to the United States Trustee says:
The vindictiveness against a client who filed a complaint with the Attorney Registration and Disciplinary Commission is remarkable.
Fifth, Mr. Liou's reaction to learning about preferences from Judge Wedoff also provides insight. Mr. Liou professed no familiarity with preference law until he testified in the Simelton hearing on April 4, 2011. (USTX 29(c), pp. 81-83) Thereafter, he simply started limiting collection of prior fees to the amount of $599.99, one cent below the $600 threshold set by section 547(c)(8). It is hard to believe that an attorney who has practiced bankruptcy law for 17 years just learned about preferences in 2011.
Sixth, two cases Mr. Liou filed for Juana Avilla—10 B 21375 and 10 B 37399—illustrate Mr. Liou's total lack of any moral restraint and the predatory nature of his
The second case was filed under chapter 7 on August 20, 2010. The Rule 2016(b) statement Mr. Liou filed with the petition disclosed that he had agreed to a fee of $2,595 for the case and had received that amount prior to filing the petition. Paragraph 9 of SOFA filed with the petition listed five payments to Mr. Liou in the year before the chapter 7 petition was filed:
$2,500 on May 10, 2010 $800 on August 2, 2010 $1,000 on June 28, 2010 $996 on June 28, 2010 $799 on August 19, 2010
The first payment listed appears to be the pre-petition payment in the first case. The third payment of $1,000 appears to complete payment on the fees from the first case. The other three payments total the $2,595 fee for the second case.
Two things are remarkable. First, Mr. Liou received over $6,000 for what probably should have been a simple chapter 7 case from the beginning. Second, Mr. Liou received $1,996 from the debtor on June 28, 2010, while the first case was still pending. Mr. Liou could offer no justification or authority for taking money directly from the debtor while the chapter 13 case was pending, and even he admitted that it "looks improper." (TX 118) That admission came on the first day of this hearing, and Mr. Liou has given no justification for his actions.
Finally, one would expect an attorney facing a disciplinary proceeding like this to be somewhat circumspect regarding his fee practices. Mr. Liou was not. In his testimony on the first day of this hearing, he announced that he was sleep-deprived because he had been working until 3:00 a.m. helping a new client file a chapter 13 case. He repeatedly stated, "I'm exhausted." This testimony called to mind his defense to the charges of lying to Judge Wedoff. There he blamed his testimony on confusion and a severe sinus infection. Consequently, the court looked at the case he filed the night before the hearing and will take judicial notice of its contents.
The case is In re Kurz, No. 13 B 01264. The Rule 2016(b) statement discloses that Mr. Liou received $4,995 from the debtors before filing the case, an extraordinary fee for what the docket reveals to be a fairly typical case. The statement refers to an attached "Attorney Fee Agreement." The attachment is entitled "Retainer Agreement." This agreement modified the CARA by increasing the attorney fees by $1,495 over the court approved flat fee of $3,500 and decreasing the attorney's duties by omitting duties 10 through 16 in the CARA. Even more remarkable is that paragraph 9 of the SOFA contradicts what is stated in the Rule 2016(b) statement. Paragraph 9 states that Mr. Liou received $5,256.64, which includes a 5% convenience fee for taking a credit card payment. This case illustrates that Mr. Liou's misconduct
In the second phase of the hearing, Mr. Liou presented three character witnesses. All three appear to be exemplary citizens. They testified credibly that, in their opinions, Mr. Liou's character was good. All three based their opinions on their personal experiences with Mr. Liou but did not base their opinions on Mr. Liou's reputation for truthfulness or untruthfulness as permitted by Federal Rule of Evidence 608(a).
Mr. Liou's misconduct is persuasive as shown by the evidence before the court. The cases in the appendices speak for themselves. Mr. Liou has been criticized by judges, ordered to disgorge fees, fined $10,000 and ordered to complete a legal ethics class. All to no avail. His lack of candor in this proceeding, his continued predatory fee practices (as seen in the Kurz case), and the record as a whole convince the court, by clear and convincing evidence, that the appropriate discipline for Mr. Liou is permanent suspension from practicing before this court.
Accordingly, effective on August 30, 2013 at 5:00 p.m., Mr. Liou will be permanently suspended from practice before the bankruptcy court for the Northern District of Illinois. His password for electronic filing will be revoked at that date and time.
The court will also order Mr. Liou to pay restitution to the clients who have been the victims of Mr. Liou's misconduct. Separate orders of permanent suspension and restitution will be entered pursuant to Local Bankruptcy Rule 9029-4B(B)(12).
Judgment for costs is awarded to the United States Trustee based on Illinois Supreme Court Rule 773(b)
Copies of this opinion will be forwarded to the Executive Committee of the United States District Court and to the Illinois Attorney Registration and Disciplinary Commission pursuant to Local Bankruptcy Rule 9029-4B(E).
Case Case Petition Payments disclosed on Prior Fees collected as evidenced by the
Name (In Number Date SOFA Question 9 Past Due Documents
re) (* Denotes Amended SOFA)
Austin 11-14539 4/6/2011 *$1,401 on 3/8/11 Prior Fees from 10-20479 ($500 on 11/22/10
and $1,401 on __/8/10)16
Baldassari 11-08737 3/2/2011 $1 on 3/16/10; Prior Fees from 10-11631 ($1,890.36 on
$600 on 3/17/10 3/2/11)
Battle 09-40441 10/27/2009 *$1,441.08 on 10/19/09; Prior Fees from 08-31485 ($1,441.08 on
$562.92 on 10/19/09 10/9/09)
Bibbs 12-23109 6/6/2012 $318.99 on 5/1/12; Prior fees from 11-14527 ($318.99 on
$281 on 12/17/11 5/1/12)
Blevins 09-10055 3/24/2009 *576.68 on 3/11/09 Prior Fees from 07-14151 ($1,553.32 on
3/11/09)
Brown 09-00634 1/10/2009 None Prior Fees from 08-10654 ($299 on 1/2/09
and $1,500 on 1/9/09)
Cedeno 09-41766 11/3/2009 $130.00 on 10/23/09; Prior Fees from 04-33959 and 05-29434
$124.00 on 10/27/09; ($1,500 10/29/09)
$1,500 on 10/29/09
Edwards 10-13990 3/30/2010 $1,774.00 on 1/28/10; Prior Fees from 08-21767 ($1,500 on
$605.67 on 3/13/10; 1/28/10; $274 on 1/28/10; $605.67 on
$1,314.33 on 3/13/10 3/13/10)
Ezell 04-41448 11/9/2004 None Prior Fees from 03-17903 ($200 on 11/1/04)
Franco 11-27884 7/6/2011 $300 on 4/28/11; Prior Fees from 10-12547 ($300 on 4/28/11;
$1,117.18 on 7/1/11; $1,117.18 on 7/1/11)
$704.82 on 7/1/11
Godinez 12-20283 5/17/2012 None Prior Fees from 11-14603 ($597.34 on
5/12/12)
Henderson 11-08745 3/3/2011 $1,587.00 on 2/19/11 Prior Fees from 09-02397 ($274 on 12/20/10;
$1,713.56 on 1/24/11)
Henry, K. 12-11155 3/20/2012 $275 on 11/7/11; Prior Fees from 08-12955 ($296.92 on
$296.92 on 3/9/12; 3/10/12)
$.08 on 3/9/12
Henry, M. 11-28850 7/13/2011 *729.28 on 6/27/11 Prior Fees from 09-48503 ($729.28 on
6/27/11)
Hines 12-23108 6/6/2012 *$500.00 on 10/6/11; Prior Fees from 11-41547 ($280.00 3/6/12)17
$499.01 on $5/25/12;
$280.00 on 3/6/12;
$319.99 on 5/25/12
Holiday 04-44889 12/7/2004 None Prior Fees from 02-21472 or 03-45837 ($500 on 12/6/04) Holmes 11-46608 11/17/2011 $599.99 on 11/9/11 Prior Fees from 10-50204 ($275 on 10/26/11; $324.99 on 11/9/11) Johnson 09-13924 4/20/2009 None Prior Fees from 07-19505 ($500 on 4/4/09; $1,829.22 on 4/18/09) Kendricks 05-28071 7/14/2005 None Prior Fees from 05-07050 ($500 on 7/8/05) Kye 12-14644 4/10/2012 $750.00 on 9/2/11; Prior Fees from 11-36928 ($287.00 on $599.99 on 2/7/12; 1/27/12; $312.99 on 2/7/12) $1,150.00 on 4/3/12 Lawrence 04-10096 3/15/2004 None Prior Fees from 03-29298 ($250 on 3/12/04) Lipscomb 07-04054 3/7/2007 None Prior Fees from 05-21662 ($638 on 3/6/07) Maldonado 11-33575 8/16/2011 $933.87 on 8/11/11; Prior Fees from 10-32258 ($274 on 6/6/11; $2,768.77 on 8/11/11 $659.87 on 8/13/11) Manning- 09-44050 11/19/2009 $1,650 on 2/18/09 Prior Fees from 09-05248 ($795 on Sanders 11/19/09) Manuel 12-08217 3/1/2012 $1,081.01 on 2/9/12 Prior Fees from 10-40169(?) ($599.99 on 2/9/12) Manuel 12-25082 6/21/2012 $599.99 on 2/9/12; Prior Fees from 12-08217 ($599.99 on $100.01 on 2/9/12; 6/20/12) $599.99 on 6/20/12 Martin 09-41792 11/4/2009 $338.64 on 10/23/09; Prior Fees from 08-17534 ($772.15 on $109.51 on 10/23/09; 9/28/09; $772.15 on 10/9/09; $338.64 on $274.00 on 9/10/09; 10/23/09) $772.51 on 9/28/09 Moss/Diaz 12-36611 9/14/2012 $515.00 on 2/10/12; Prior Fees from 12-6505 ($281 on 7/12/12; $318.99 on 7/25/12; $318.99 on 7/25/12) $.01 on 9/12/12; $281.00 on 7/12/12 Redmond 12-29684 7/26/2012 $1,400.01 on 7/3/12; Prior Fees from 10-53484 ($599.99 on $599.99 on 7/3/12 7/3/12) Ross- 12-24899 6/20/2012 $299.99 on 6/1/12; Prior Fees from 11-43491 ($300 on 5/18/12; Aikens $1,415.00 on 10/25/11; $299.99 on 6/1/12) $19.01 on 6/5/12; $300.00 on 5/18/12 Simelton 10-22771 5/18/2010 None Prior Fees from 03-13002 ($710 on 5/10/10) Sledd 12-29682 7/26/2012 $599.99 on 7/20/12; Prior Fees from 11-46681 ($281.00 indicated $500.01 on 7/20/12 as having been received by note to file made on 7/26/12; $318.99 on 7/20/12) Stuebe 09-13617 4/16/2009 *$101.20 on 4/16/09; Prior Fees from 07-19899 ($790.42 on $2,090.20 on "various— 4/16/09) 07 B 19899" Styles 07-11911 7/3/2007 None Prior Fees from 06-11014 ($713.45 on 6/26/07)
Sweet 12-32456 8/15/2012 $993.00 on 11/9/11; Prior Fees from 11-45857 ($599.99 on $599.99 on 7/19/12; 7/19/12) $1,700.01 7/19/12 Tate 12-33432 8/22/2012 $599.99 on 8/21/12; Prior Fees from 05-26685 ($102 on 8/17/12; $121.02 on 8/21/12 $497.99 on 8/21/12) Thompson 11-12002 3/23/2011 $1,602.11 on 3/18/11 Prior Fees from 08-02600 ($274 on 3/4/11; $1,328.11 on 3/21/11) Watts 09-38221 10/13/2009 $274 on 9/25/09 Prior Fees from 07-15583 ($274 on 9/25/09) Weisinger 08-23971 9/10/2008 None Prior Fees from 05-15744 ($274 on 9/8/08; $1,350.09 on 9/9/08 (from sister)) Wise 08-04390 2/26/2008 *None Prior Fees from 07-03940 ($1698.18 on 1/8/08)
Case Case No. Fees Date of Subsequent Filing Fees for Payments disclosed Fees Case/
Name owed at Dismissal Case No. Date prior in response to collected Payment(s)
(In re) dismissal case Question 9 of in advance disclosed in
shown in Statement of for "Past Due
Schedules Financial Affairs subsequent Documents"
(*Denotes case
Amended SOFA) (*Denotes
Amended
2016
Statement)
Avila 10-21375 $1,009.64 7/12/2010 10-37399 8/20/2010 None $2,500.00 on $2,595.00 No
5/10/10; $800.00 on
8/2/10; 1,000.00 on
6/28/10; $996.00 on
6/28/10; $799.00 on
8/19/10
Castro 07-12260 $1,160.20 10/3/2008 08-29117 10/28/2008 None None $1,094.91 No
Charles 08-01373 $2,264.20 8/18/2008 09-11953 4/3/2009 None None $152.04 No
Delgado 07-04444 $734.20 10/15/2007 07-19270 10/18/2007 None *None $1,672.41 No
Echevarria 08-32941 $1,665.64 11/20/2009 10-04079 2/2/2010 None $1934.00 on 1/29/10 $0.00 No
Fisher 08-04365 $594.20 7/17/2008 08-22809 8/28/2008 None None $3,112.00 No
Furtell 08-04664 $456.20 7/16/2009 09-31260 8/25/2009 None None $3,422.75 No
Graham 07-16965 $1,383.20 7/16/2008 08-18807 7/22/2008 None None $1,742.90 No
Gutierrez- 08-23329 $2,067.20 3/20/2009 09-31307 8/25/2009 None None $1,695.00 No
Ojeda
Hilson 10-32260 $2,858.64 10/29/2010 10-55252 12/15/2010 None $651.00 on 7/19/10; $500.00 No $2,849.00 on 12/6/10; $400.00 on 12/10/10 Humphrey 07-06935 $105.00 3/25/2008 08-12826 5/20/2008 None None $2,875.33 No Jackson 10-32300 $941.64 12/21/2010 11-06106 2/16/2011 None *$1,246.00 on *$1,246.00 No 2/16/11 Jones 10-10153 $754.64 6/10/2010 10-43452 9/28/2010 None $2,947.00 - No Date $2,947.00 No Laboy 10-24248 $973.64 1/10/2011 11-09637 3/8/2011 None *$1,768.00 on $1,768.00 No 3/7/11 $471.18 on 3/7/11 Martin 07-18053 $207.21 1/3/2008 08-08604 4/9/2008 None None $0.00 No Martinez 08-04968 $999.69 5/13/2008 09-48502 12/22/2009 None $2,637.00 on $2,637.00 No 12/19/09 McDougall 09-05068 $884.20 11/2/2009 10-49461 11/3/2010 None $2,695.00 on $2,695.00 No 11/1/10 Moreno 07-01533 $1,553.45 9/16/2010 10-34686 8/3/2010 None $1.00 on 5/24/10; $1,895.00 No $500.00 on 6/23/10; $400.00 7/12/10; $500.00 on 7/29/10; $494.00 on 8/2/10 Nash 09-07334 $91.10 1/28/2010 10-34534 8/1/2010 None None $0.00 No Porter 07-03400 $1,195.00 10/5/2007 07-21659 11/17/2007 None None $113.05 No Robinson 08-06155 $619.70 7/23/2008 08-23841 9/9/2008 None *None *$1,206.76 No Ruiz 09-01768 $1,329.20 7/16/2009 09-38228 10/13/2009 None $2,180 on 1/22/09 $2,339.71 No $280.00 on 7/9/09 $2,626.00 on 9/1/09 $900.00 on 9/24/09 Simmons 07-08483 $1,465.20 10/25/2007 09-28627 8/4/2009 None $1,340.00 on 8/3/09 $1,340.00 No Smith, A. 09-43804 $451.02 6/23/2010 10-33247 7/27/2010 None *$626.12 on 7/26/10 *$626.12 No Smith, C. 08-15570 $2,597.68 10/3/2008 08-34446 12/17/2008 None None $1,466.89 No Smith- 07-16486 $1,709.20 8/18/2008 08-29106 10/28/2008 None None $624.15 No Moore Stuckey 08-05790 $435.00 9/11/2008 08-32320 11/25/2008 None None $3,500.00 No Surpris 07-11540 $1,441.20 8/18/2008 08-25314 9/23/2008 None None $1,054.25 No Taylor 09-38226 $8.49 12/16/2009 10-08783 3/2/2010 None $3,500.00 on 3/1/10 $3,500.00 No Tucker 08-26821 $1,824.52 9/16/2009 09-41789 11/4/2009 None $1,933.10 on $0.00 No 11/2/09
West 07-18532 $527.00 10/8/2008 08-31481 11/18/2008 None None $253.96 No
Williams 07-08442 $927.68 1/9/2008 09-15323 4/28/2009 Kurt None $0.00 No
Kolar
$1,053.32
Williams 08-12171 $1,690.17 12/8/2009 09-49093 12/29/2009 Kurt $1,506.00 on $0.00 No
Kolar 12/19/09; $254.00
$475.24 on 11/30/09;
$500.00 on 12/26/09
Winston 10-05057 $1,195.28 1/3/2011 11-09608 3/8/2011 None $1.72 on 2/3/10 $1.72 No
Wright 08-01390 $1,544.00 2/7/2008 08-04355 2/26/2008 None None $1,956.00 No
Case Name Claim # on Amount of (In re) Case Number Claims Register Date Claim Filed Claim Sappington 01-00908 1 April 20, 2001 $537.61 Simon 01-08098 1 April 20, 2001 $1,518.62 Ewing 01-34586 7 February 6, 2002 $3,301.85 Joseph 02-30583 4 May 6, 2004 $1,723.71 Tripp 02-32496 5 November 25, 2002 $937.74 Norman 03-27855 1 July 24, 2003 $2,749.40 Childs 03-38719 1 September 29, 2003 $2,200.00 Wynn 03-40852 6 January 13, 2004 $2,322.00 Bolden 03-48814 1 December 10, 2003 $1,509.15 Payne 04-03297 1 February 9, 2004 $1,137.14 Lawrence 04-10096 2 April 13, 2004 $1,936.00 Hayes-Mathis 04-11545 2 April 13, 2004 $1,105.00 Evans 04-13374 1 April 13, 2004 $2,016.00 Ferguson 04-21870 3 August 9, 2004 $1,589.65 Conner 04-33930 5 November 1, 2004 $2,227.43 Spano 04-34921 2 October 27, 2004 $1,437.45 Vogwill 04-37199 5 October 27, 2004 $450.00 Miulli 04-37728 1 October 21, 2004 $3,274.47 Ezell 04-41448 5 May 24, 2006 $2,625.26 Aikens 04-43401 1 December 6, 2004 $544.00 Sowell 04-44662 1 December 16, 2004 $591.18 Harlin 04-45219 1 December 14, 2004 $1,100.85 Pettis 05-00847 3 February 7, 2005 $3,186.00 Lipscomb 05-21662 4 June 22, 2005 $1,916.75 Cedeno 05-29434 4 November 5, 2005 $2,421.24 White 05-33455 1 October 5, 2005 $1,800.54 Riley 05-43883 3 February 22, 2006 $1,294.94 Bolden 07-00788 10 June 12, 2007 $462.23 Quevedo 07-14146 4 November 27, 2007 $945.52 Johnson 08-03585 6 March 2, 2008 $1,317.84 Trotter 08-21740 3 November 20, 2008 $1,863.60 Brown 09-02380 19 May 26, 2009 $3,123.66 Williams 09-15323 4 June 7, 2009 $1,056.97 Cedeno 09-41766 6 December 8, 2010 $5,707.87 Simelton 10-22771 12 September 10, 2010 $2,634.97
Account
Number Known Activity
Institution (last four) Name on Account Period
LIOU LAW FIRM
TIMOTHY LIOU, SOLE
PROP CONSTRUCTION
Bank of America 8122 ACCOUNT 07/2010-09/2012
DBA LIOU LAW FIRM
TIMOTHY LIOU SOLE
1836 PROP 05/2010-09/2012
BMO Harris, N.A. 8674 LIOU LAW FIRM P.C. 10/2005-07/2012
2948 LIOU LAW FIRM P.C. 12/2008-07/2012
Charter One 9133 Liou Law Firm/T K Liou 10/2005-11/2007
5055 Liou Law Firm/T K Liou 10/2005-12/2007
7122 Liou Law Firm 11/2007-06/2008
7130 Liou Law Firm 11/2007-06/2008
7149 Liou Law Firm 12/2007-06/2008
JP Morgan Chase 0613 Timothy K Liou Esq 06/2011-03/2012
1252 Timothy K Liou 04/2007-03/2012
4346 Timothy K Liou 06/2005-04/2012
0324 Filenow Com Inc 05/2011-03/2012
Case Name Case
(In re) Number
Hayes 06-01582
Williams 06-04978
Miranda 06-09615
Del Rosario 06-11376
Abdullahi 06-11767
Bautista 06-16416
Howard 06-16821
Moncure 07-00120
Richard 07-03405
Radcliff 08-05795
Williams 08-12163
Ward 08-17658
Santiago 09-00636
Johnson 09-00638
Wilson 09-01552
Diggs 09-01845
Holmes 09-03443
Stamps 09-03451
Sheran 09-05043
Adams 09-05061
Dumas 09-05075
Lynumn 09-07347
Gilmore 09-08019
Scott 09-21865
Almanza 09-27843
Negron 09-28632
Johnson 09-36919
Zielske 09-43621
Chappell 09-46345
Kenney 10-00986
Morales 10-12548
Porter 10-21376
Owens 10-26807
Johnson 10-29108
Cliff 10-30256
Hernandez 10-44748
Holmes 10-50204
Matthews 11-21172
Holmes 11-46608
Gandy 12-01031
N.D. Ill. R. 83.51.7 (patterned on the ABA Model Rules).
N.D. Ill. R. 83.53.3 (patterned on the ABA Model Rules).
MODEL RULES OF PROF'L CONDUCT R. 1.7 (2010).
MODEL RULES OF PROF'L CONDUCT R. 3.3 (2010).
