                                                              2013 WI 24

                  SUPREME COURT          OF   WISCONSIN
CASE NO.:               2011AP443-D
COMPLETE TITLE:         In the Matter of Disciplinary Proceedings
                        Against
                        Victor M. Arellano, Attorney at Law:

                        Office of Lawyer Regulation,
                                  Complainant,
                             v.
                        Victor M. Arellano,
                                  Respondent.

                           DISCIPLINARY PROCEEDINGS AGAINST ARELLANO

OPINION FILED:          March 21, 2013
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
   COURT:
   COUNTY:
   JUDGE:

JUSTICES:
   CONCURRED:
   DISSENTED:
   NOT PARTICIPATING:   Abrahamson, C.J., Gableman, J., did not
                        participate.

ATTORNEYS:
                                                                    2013 WI 24
                                                            NOTICE
                                              This opinion is subject to further
                                              editing and modification.   The final
                                              version will appear in the bound
                                              volume of the official reports.
No.       2011AP443-D


STATE OF WISCONSIN                        :            IN SUPREME COURT

In the Matter of Disciplinary Proceedings
Against Victor M. Arellano, Attorney at Law:

Office of Lawyer Regulation,                                     FILED
              Complainant,
                                                            MAR 21, 2013
      v.
                                                               Diane M. Fremgen
                                                            Clerk of Supreme Court
Victor M. Arellano,

              Respondent.




      ATTORNEY     disciplinary    proceeding.         Attorney        publicly

reprimanded.


      ¶1      PER CURIAM.    Pending before the court is a report and

recommendation filed by Referee John B. Murphy, recommending the
court publicly reprimand Attorney Victor M. Arellano for two

counts of professional misconduct.       No appeal has been filed so
the court's review proceeds pursuant to SCR 22.17(2).1                     Costs

      1
          SCR 22.17(2) states:

           If no appeal is filed timely, the supreme court
      shall review the referee's report; adopt, reject or
                                                                          No.        2011AP443-D



totaling $40,960.49 as of August 6, 2012, are disputed.2                                     We

conclude that the referee's findings of fact are supported by

satisfactory          and     convincing           evidence     and      we       adopt     his

conclusions of law.             We agree that the appropriate discipline

for Attorney Arellano's misconduct is a public reprimand.                                    We

further conclude that 25 percent of the costs of the proceeding

should be assessed against Attorney Arellano.

        ¶2    Attorney Arellano was admitted to the practice of law

in Wisconsin on September 27, 1985.                     He practices in Middleton,

Wisconsin.          He has one previous private reprimand dating from

2008.

     ¶3       On     February     28,    2011,       the    OLR    filed      a      complaint

alleging 14 counts of misconduct based on events spanning from

1991 to 2007.           The OLR initiated this proceeding after four

female       former     clients        filed        grievances         against        Attorney

Arellano,       each        alleging    professional          misconduct,            including

claims       that    Attorney      Arellano         engaged       in    improper        sexual

relations      with them.         The    OLR       sought     revocation        of    Attorney
Arellano's license.

    ¶4        Referee Murphy was appointed on April 18, 2011.                              Over
the ensuing year, nine of the 14 counts were dismissed before


        modify the referee's findings and conclusions or
        remand the matter to the referee for additional
        findings;   and   determine  and   impose  appropriate
        discipline.   The court, on its own motion, may order
        the parties to file briefs in the matter.
        2
       The Office of Lawyer Regulation (OLR) does not seek
restitution and we accede to the OLR's judgment on this issue.

                                               2
                                                        No.        2011AP443-D



the evidentiary hearing.3        In January 2012 the referee conducted

a 2 1/2 day evidentiary proceeding on the remaining five counts

of alleged misconduct.4      The referee subsequently dismissed Count

One in his report filed February 3, 2012, and on May 25, 2012,

filed a report concluding that Attorney Arellano committed two

counts of professional misconduct and dismissed two counts.5              The

parties filed briefs on the issue of sanctions, and on July 16,

2012, the referee filed his final order entitled "Recommendation

as   to    Appropriate     Discipline"   recommending   that        Attorney

Arellano be publicly reprimanded for his misconduct.

     ¶5     This court will adopt a referee's findings of fact

unless    they   are   clearly   erroneous.   Conclusions     of    law   are

reviewed de novo.        See In re Disciplinary Proceedings Against

     3
       Attorney Arellano filed a motion for partial summary
judgment on August 26, 2011, seeking summary judgment on Counts
One, Seven, Eleven, Twelve, Thirteen, and Fourteen.     The OLR
conceded it could not prove and dismissed Counts Thirteen and
Fourteen.   On November 15, 2011, the referee filed a decision
reserving the issue regarding Count One, denying the motion
regarding Counts Seven and Twelve, and granting to motion as to
Count Eleven.     On December 8, 2011, the parties filed a
stipulation and order dismissing Counts Two, Three, Four, and
Six of the complaint. This left seven counts.
     4
       At the start of the evidentiary hearing on January 3,
2012, the referee granted the OLR's motion to dismiss Count
Seven.   On the third day of the hearing, the referee granted
Attorney Arellano's unopposed motion to dismiss Count Twelve,
leaving five counts outstanding.
     5
       On February 3, 2012, following the evidentiary hearing,
the referee filed a decision dismissing Count One of the
complaint on statute of limitations grounds.    On May 25, 2012,
the referee filed a decision dismissing Counts Five and Ten of
the complaint and concluding Attorney Arellano committed the
misconduct alleged in Counts Eight and Nine of the complaint.

                                     3
                                                                        No.    2011AP443-D



Eisenberg,       2004     WI    14,    ¶5,    269    Wis. 2d 43,      675     N.W.2d 747.

Here, the OLR acceded to the dismissal of six counts (Counts

Two, Three, Four, Six, Thirteen, and Fourteen) so we need not

review these.          They will be mentioned only for context.

N.S.M.:      Counts One through Eight

        ¶6    The first eight counts of misconduct were filed in

connection       with     the   matter       of    N.S.M.      With   respect     to   the

allegations involving N.S.M., the referee found that Attorney

Arellano engaged only in the misconduct alleged in Count Eight;

the OLR agreed to dismiss Counts Two, Three, Four, and Six.                            The

referee recommended dismissal of Counts One, Five, and Seven.

        ¶7    The matter will be briefly summarized.                        On or about

August 1, 1996, N.S.M. retained Attorney Arellano to represent

her     in   a       divorce.      Attorney         Arellano    and    N.S.M.    quickly

commenced        a    relationship      and       eventually    lived    together      for

several      years.        Their      relationship      ended,    acrimoniously,       in

2005.

      ¶8      Following the breakup,                N.S.M.   alleged    that    Attorney

Arellano disparaged and defamed her in telephone calls to her
father, e-mails to her sister and her cousin, in correspondence

to some of her employers, and he reported to the sheriff that
she had committed forgery.6                  N.S.M. also alleged that Attorney

Arellano provided private information to her former husband in

        6
       In July 2006 N.S.M. was charged with 16 criminal counts
including forgery, writing bad checks, and failure to file tax
returns.   On June 11, 2007, she entered no contest pleas to a
felony forgery charge and a misdemeanor charge of issuing a
worthless check.

                                              4
                                                                            No.    2011AP443-D



an effort to adversely affect her custody of the minor child

from the marriage.                Attorney Arellano, in turn, alleged that

N.S.M. took large sums of money from him.

        ¶9    Count       One    of    the    OLR's     complaint        alleged     that    by

commencing a sexual relationship with N.S.M. after she hired him

to represent her in a divorce in August 1996, Attorney Arellano

violated former SCR 20:1.8(k)(1) and (2), effective prior to

July 1, 2007.         The referee dismissed Count One as exceeding the

permissible statute of limitations in an order filed February 3,

2012.        The OLR does not appeal this ruling.                           We accept the

referee's findings and conclusions on this charge.

     ¶10      Count       Two     alleged      that     by      having      at    least     152

telephone conversations with N.S.M.'s former husband and/or her

former       husband's          wife       subsequent      to       Attorney      Arellano's

representation        of        N.S.M.,      when   some       of   those    conversations

involved      ongoing      proceedings         relating        to   a    custody     dispute,

Attorney Arellano violated former SCR 20:1.9(b), effective prior

to July 1, 2007, and current SCR 20:1.9(c).
     ¶11      On    December          8,    2011,   the      OLR     stipulated      to     the

dismissal      of    Count       Two,      admitting      it    could      not    prove     the
information         was     "related"         to      Attorney          Arellano's    former

representation of N.S.M.
    ¶12       Count Three of the complaint alleged that by providing

N.S.M.'s former husband with a copy of at least one of N.S.M.'s
bank statements, for the purpose of indicating that N.S.M. had

filed a false financial disclosure statement in the post-divorce

matters, Attorney Arellano violated former SCR 20:1.9(b).                                   The
                                                5
                                                                        No.      2011AP443-D



OLR stipulated to the dismissal of this count on December 8,

2011.

       ¶13    Count Four of the complaint alleged that by giving

N.S.M.'s former husband a May 4, 2006 letter with enclosures,

Attorney      Arellano     violated      former       SCR     20:1.9(b).            The   OLR

stipulated to the dismissal of this count on December 8, 2011.

       ¶14    Count Five of the complaint alleged that by providing

the guardian ad litem for N.S.M.'s minor child with 73 proposed

requests to admit pertaining to N.S.M. for use in the post-

divorce        matters,         Attorney           Arellano      violated              former

SCR 20:1.9(b).

       ¶15    The referee conducted a hearing on Count Five.                            After

the    hearing,      the   referee     recommended       dismissal      of       the    count

stating, "While [Attorney] Arellano's use of this information

was clearly meant to harm               [N.S.M.'s]       chances     in       her   custody

dispute      and    was,   therefore,      inappropriate,        mean       spirited      and

childish, its use does not constitute a violation of the Rule."

The    OLR    did    not   appeal      this       decision,    and     we     accept      the
referee's findings and conclusions on this charge.

       ¶16    Count Six of the complaint alleged that by providing
the     Madison      Police      Department,         through     his        attorney,       a

Confidential        Financial     Disclosure        Statement     and       an    affidavit
with N.S.M.'s son's school progress report, both of which had

been filed by N.S.M. in post-divorce matters in which Attorney
Arellano had previously represented her, and by giving N.S.M.'s

bank    statements         to    the    sheriff's        department           and      police

department,        Attorney     Arellano      violated      former     SCR       20:1.9(b).
                                              6
                                                                     No.   2011AP443-D



The OLR stipulated to the dismissal of this count on December 8,

2011.

        ¶17       Count Seven alleged that by sending a disparaging e-

mail about N.S.M. to her sister and her cousin using his law

firm's           equipment   and   the   services    of   his    paralegal,        by

contacting N.S.M.'s employer to make negative allegations about

her,        by    repeatedly    contacting    a   co-worker     of     N.S.M.'s    to

disparage N.S.M., by delivering to the co-worker's home in a law

firm envelope documents intended to disparage N.S.M., by making

at least 186 telephone calls to N.S.M. in the course of one day,

and by telephoning N.S.M.'s father in the middle of the night in

August 2005 to insult N.S.M. in a crude and offensive manner,

including          describing   sexual   acts,    Attorney    Arellano      violated

SCR 40.15.

        ¶18       The referee granted the OLR's motion to dismiss this

charge at the start of the evidentiary hearing on January 3,

2012.

       ¶19        Count Eight of the complaint alleged that by making
misrepresentations to the OLR and to its District 9 Committee,

or members thereof, in the course of the OLR's investigation of
N.S.M.'s grievance, Attorney Arellano violated SCR 22.03(6)7 via

        7
            SCR 22.03(6) provides:

             In   the   course   of  the    investigation,   the
        respondent's   wilful  failure   to   provide   relevant
        information, to answer questions fully, or to furnish
        documents and the respondent's misrepresentation in a
        disclosure are misconduct, regardless of the merits of
        the matters asserted in the grievance.

                                          7
                                                                         No.    2011AP443-D



SCR 20:8.4(h).8             The referee concluded that Attorney Arellano

committed this misconduct.

        ¶20       The referee noted that obstructing the work of the

District Committee by his misleading and false statements is a

serious violation.             The referee observed that the "ability of

the Supreme Court to properly monitor and enforce the Rules of

Professional             Conduct   through          its    investigative        resources

requires          that    attorneys        under    investigation       be     absolutely

truthful in their response to inquiries."                          The referee observed

that Attorney Arellano was an experienced attorney who had been

previously         investigated       in    another       matter    unrelated    to   this

case.        He knew the rules and his obligation to be truthful even

when        not   under    oath.   In       spite    of    this    knowledge,    Attorney

Arellano chose to lie and to mislead the District Committee and,

in doing so, he undermined the integrity of both the lawyer

regulation system and the legal profession itself.

       ¶21        Thus, the referee found, and the record supports the

finding, that Attorney Arellano was, for a time, N.S.M.'s lawyer
and he and N.S.M. subsequently had an acrimonious break-up.                            The

record discloses that both individuals engaged in behavior that
was, to use the referee's words, "inappropriate, mean spirited

and childish."             Ultimately, there was insufficient evidence to
substantiate the allegations in Counts One through Seven of the

        8
       SCR 20:8.4(h) states it is professional misconduct for a
lawyer to "fail to cooperate in the investigation of a grievance
filed with the office of lawyer regulation as required by
SCR 21.15(4), SCR 22.001(9)(b), SCR 22.03(2), SCR 22.03(6), or
SCR 22.04(1); . . . ."

                                               8
                                                                      No.     2011AP443-D



complaint.           The     referee   concluded     that       Attorney          Arellano

committed the misconduct alleged in Count Eight by misleading

the   OLR     and    the    District   Committee    about      the    nature       of     his

representation         of     N.S.M.     We    accept       these      findings          and

conclusions.

M.F.:     Counts Nine and Ten

        ¶22    On or about October 11, 2000, M.F. filed a Charge of

Discrimination             (Discrimination     Charge)         with         the         Equal

Opportunity Employment Commission and the Equal Rights Division

of the Wisconsin Department of Workforce Development against her

former employer, the City of Milwaukee Mayor's Office (City).

M.F. alleged that between 1995 and 2000, then-City of Milwaukee

Mayor John Norquist unlawfully harassed M.F.

      ¶23      At or about the time M.F. filed the Discrimination

Charge, Attorney Arellano initiated contact with M.F., calling

her telephone number and leaving voicemail messages.                              Attorney

Arellano        solicited       employment     as        her     lawyer           in      the

discrimination matter.

      ¶24      On or about October 23, 2000, M.F. retained Attorney
Arellano and his then-firm, Lawton & Cates, S.C., to represent

her in the Discrimination Charge against the City.                                The OLR
alleged       that   following     commencement     of    their      attorney-client

relationship,        Attorney     Arellano    and   M.F.       commenced      a        sexual
relationship.




                                          9
                                                                  No.     2011AP443-D



     ¶25    Count   Nine    of   the      OLR's   complaint        alleged      that

Attorney Arellano violated former SCR 20:7.3(c),9 by initiating

contact with M.F. and making one or more unsolicited telephone

calls to her for the purpose of inducing her to hire him to

represent her in the Discrimination Charge against the City.

Following the hearing, the referee concluded Attorney Arellano

committed this misconduct.

     ¶26    The   referee   found      that   M.F.    did    not    request        the

contact.    The American Bar Association (ABA) Comment regarding

SCR 20:7.3 in the Wisconsin Rules of Professional Conduct for

Attorneys   makes   clear   that    the     purpose   of    SCR    20:7.3     is   to

prevent a potential client from being pressured into entering

into a representation agreement with an attorney.                       The Comment


     9
       Former SCR 20:7.3(c), effective prior to July 1, 2007,
provided:

          A lawyer shall not initiate personal contact,
     including telephone contact, with a prospective client
     for the purpose of obtaining professional employment
     except in the following circumstances and subject to
     the requirements of Rule 7.1 and paragraph (d):

          (1) If the prospective client is a close friend,
     relative or former client, or one whom the lawyer
     reasonably believes to be a client.

         (2) Under the auspices of a public or charitable
    legal services organization.

         (3) Under the auspices of a bona fide political,
    social,   civic,    fraternal,  employee   or   trade
    organization whose purposes include but are not
    limited to providing or recommending legal services,
    if the legal services are related to the principal
    purposes of the organization.

                                       10
                                                                         No.   2011AP443-D



cites    the     unequal      nature    of        the    relationship      between     the

potential client and the lawyer as being fertile ground for the

application of undue pressure upon the client.

     ¶27    The referee noted that while it is true that Attorney

Arellano did contact M.F., the contact was by telephone and not

in person.          Moreover, Attorney Arellano told M.F. that if she

wanted to discuss the case further, she must come to Madison

from Milwaukee and meet at Attorney Arellano's law office.                                A

number of days after the call, M.F. did go to Madison, did meet

with Attorney Arellano, and did sign a retainer agreement.                             M.F.

never claimed that she was pressured by Attorney Arellano to

retain his legal services.             Thus, the referee noted:

          The elements of undue pressure outlined in the
     Comment to Rule 20:7.3 do not seem to exist in the
     case. There is no question that the call occurred and
     that the Rule was violated.    However, the violation
     seems more technical than substantive and therefore is
     not nearly as egregious an offense as it might have
     otherwise been.
We adopt the referee's findings and conclusion on this count.

     ¶28    Count      Ten    alleged     that          Attorney    Arellano       violated

former     SCR      20:1.8(k)(1)       and     (2)       by    commencing      a    sexual
relationship with M.F. after she retained him as her lawyer.

Attorney       Arellano      vehemently       disputed         this     charge.       M.F.

testified      in    detail    about     the       relationship.           The     parties

litigated this issue extensively.

     ¶29    Following        the   hearing,         the       referee    deemed     M.F.'s

version of events not credible.                   Extensive documentary evidence,

including       billing      records    submitted             by   Attorney      Arellano,


                                             11
                                                                         No.       2011AP443-D



persuaded    the     referee     that   it     would    have       been       logistically

impossible     for    Attorney     Arellano       and       M.F.    to        conduct      the

relationship in the manner described by M.F.                       Thus, the referee

concluded that the OLR failed to provide clear, satisfactory,

and convincing evidence sufficient to sustain this charge.                                  We

accept the referee's findings and conclusion in this matter.

     ¶30    The     parties'     litigation      of     Count      Ten        is    relevant

because     Attorney      Arellano       argues,        persuasively,               that     a

significant percentage of the evidentiary hearing was dedicated

to   the    OLR's     unsuccessful       attempt       to    prove        this       charge.

Ultimately, the referee had to decide whether M.F. or Attorney

Arellano    was    more   credible      with    respect      to     whether         Attorney

Arellano engaged in an improper sexual relationship in violation

of former SCR 20:1.8(k)(1) and (2).                Attorney Arellano contends

the fact     he    prevailed on      this     charge    warrants          a    significant

decrease in the costs imposed on him.

I.G.: Counts Eleven through Thirteen

     ¶31     I.G. is a native and citizen of Mexico.                           In the fall

of 2005, I.G. and Attorney Arellano began dating.                             At the time,

I.G. had two minor children with a former husband from whom she

was divorced in 1999.            Between 2002 and 2004, I.G. was married

to a U.S. citizen.

     ¶32    When I.G. met Attorney Arellano, she was trying to

obtain immigrant classification as the spouse of an abusive U.S.

citizen so she could lawfully remain in the United States and be

eligible for certain government benefits.                     Seeking this status

required     her     to   file     an   "I-360        Petition       for        Amerasian,
                                         12
                                                                       No.     2011AP443-D



Widow(er),       or    Special     Immigrant"      (I-360     Petition)      along       with

supporting documentation.              She was working with another lawyer

at this time.

     ¶33    In July 2006 I.G. became pregnant and told Attorney

Arellano that he was the father of her unborn child.10

     ¶34    In late 2006 Attorney Arellano began to provide legal

services to I.G., including assistance in preparing the I-360

Petition.        Attorney Arellano did this work individually, not

through his firm.

     ¶35    In March 2007 I.G. gave birth to N.G.                       In April 2007

Attorney    Arellano       executed     the      I-360   Petition      as    the    person

preparing the form for I.G. as the petitioner and identified

himself as the company or organization filing the petition.

     ¶36    By        letter   dated    April      20,   2007,    and       prepared      by

Attorney Arellano, I.G. signed and filed with the INS the I-360

Petition and supporting materials.                  The I-360 Petition required

that the petitioner supply "Information about the spouse and

children    of    the     person     this   petition     is    for,"    that       is,   the
spouse and children of I.G.                 In preparing the I-360 Petition,

Attorney Arellano included information about I.G.'s two older
children.    None of the filed documents mention the baby, N.G.

     ¶37    Both I.G. and I.G.'s mother allegedly asked Attorney
Arellano     about       the   omission       of   any   information         about       the

expectant    child       on    the    I-360      Petition.       Attorney       Arellano


     10
       Attorney Arellano was subsequently adjudicated the father
of I.G.'s child, N.G.

                                            13
                                                                             No.     2011AP443-D



allegedly stated he did not want to include information about

the expectant child because he did not want the state coming

after him for support, and they should just wait and he and I.G.

would be married after the baby was born.

      ¶38    On September 24, 2007, without prior notice to I.G.,

Attorney     Arellano           withdrew       as    counsel         for      I.G.            I.G.

subsequently retained new counsel who notified the INS of the

need to correct the omission in the I-360 Petition by disclosing

N.G. as a child "of the person this petition is for."

      ¶39    Count Eleven of the OLR's complaint alleged that by

representing I.G. with respect to her I-360 Petition which asked

for information about I.G.'s children, when he knew at the time

of the representation that he was the likely father of N.G.,

without obtaining I.G.'s written consent to the representation,

Attorney Arellano violated former SCR 20:1.7(b), effective prior

to July 1, 2007.

      ¶40    The     referee         granted    Attorney        Arellano's         motion       to

dismiss     this    count       on   November       15,   2011.        The     OLR      has    not
appealed this decision, and we accept the referee's findings and

conclusions on this charge.
      ¶41    Count      Twelve       alleged    that      by    advising       I.G.     not     to

identify     N.G.    on    the       I-360    Petition,        by    failing       to   include
N.G.'s    name     on     the    I-360       Petition,     by       signing    a     statement

declaring he prepared the petition and that it was based upon
all   information         of    which    he    had    knowledge,        by    drafting         for

I.G.'s signature and notarizing her signature on an affidavit

which did not mention N.G. and which inaccurately referred to
                                               14
                                                                             No.    2011AP443-D



one of her other sons as her youngest son, and by filing the

petition    with       the     U.S.    Citizenship          and    Immigration       Services,

Department        of    Homeland        Security,       Attorney         Arellano     violated

SCR 20:1.2(d), SCR 20:8.4(c), and former SCR 20:3.3(a)(1).

      ¶42    The       referee        granted        Attorney      Arellano's        unopposed

motion to dismiss Count Twelve at the evidentiary hearing on

January 5,     2012.            The     record       indicates      these     charges     were

dismissed      because           I.G.        failed      to       appear      to      testify.

Consequently, the uncontroverted evidence from the hearing could

not    support           the         allegation        that        Attorney         Arellano's

nondisclosure was intentional.                      Attorney Arellano had testified

that the omission of his child's name from the documents was an

oversight.        We accept the referee's findings and conclusion on

this charge.

      ¶43    Count Thirteen of the complaint alleged that Attorney

Arellano     violated          SCR    20:1.16(d)       by     unilaterally         withdrawing

from representing I.G. relative to the I-360 Petition without

prior notice and/or allowing time for employment of substitute
counsel.     The OLR stipulated to the dismissal of this charge.

E.W.: Count Fourteen

      ¶44    In        April     1991        E.W.     hired       Attorney     Arellano      to

represent her in a divorce action.                       The complaint alleged that

Attorney Arellano began a sexual relationship with E.W. that

continued during his representation of her.                              Their relationship

terminated in 1994.

      ¶45    By    September          2007     Attorney       Arellano       had    reason   to

believe     that       N.S.M.,       I.G.,    and/or     M.F.,      or    possibly     another
                                                15
                                                                           No.        2011AP443-D



woman, had filed or were likely to file grievances against him

with the OLR.

       ¶46   On September 29, 2007, Attorney Arellano called E.W.

and spoke with her for approximately 20 minutes.                               According to

E.W., Attorney Arellano told E.W. that if she was called by any

investigators, or by any of the women he had reason to believe

had filed or may file grievances against him with the OLR, E.W.

should   not      speak     with     them     or   she     should    hang        up    and    let

Attorney Arellano know that she had received such a call.

       ¶47   Thus,      the     OLR     alleged       that    by     calling           E.W.    on

September    29,       2007,    and    telling       her    not     to   speak        with    any

investigators, or to hang up if called, and not to speak with

any of the women who he had reason to believe had filed or may

file   grievances        against      him     with   the     OLR,    Attorney          Arellano

violated       SCR        21.15(4),         SCR      22.03(6),           SCR      20:8.4(h),

SCR 20:8.4(a), and SCR 20:8.4(f).                     The OLR agreed to dismiss

this   count      as    part    of    the     summary      judgment       decision         filed

November     15,       2011.         Record    evidence,          including       deposition
testimony from E.W., indicated E.W. was persuaded to provide the

OLR with untruthful information by some of the other grievants
in this matter.

       ¶48   In      sum,      following       extensive       pre-hearing             motions,
decisions, and a lengthy evidentiary hearing, the referee filed

a report on May 25, 2012.               The referee ultimately concluded that
the OLR had proven that Attorney Arellano violated SCR 22.03(6)

via SCR 20:8:4(h) because he was both misleading and untruthful

in his answers to the District Committee with regard to their
                                              16
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investigation of a grievance filed by N.S.M. (Count Eight).                         The

referee also concluded that Attorney Arellano violated former

SCR 20:7.3(c) by initiating contact with M.F. and making one or

more    unsolicited      telephone    calls     to   her    for   the     purpose       of

inducing her to hire him to represent her in the Discrimination

Charge against the City (Count Nine).                 The OLR did not succeed

in proving any of the other 12 alleged counts of misconduct.

       ¶49     The referee then considered the appropriate discipline

after receiving the parties' briefs on the issue of sanctions.

The OLR had requested a public reprimand.                        Attorney Arellano

maintained that a private reprimand is sufficient and seeks a

significant, if not a total reduction in costs.                           The referee

filed a report on July 16, 2012, entitled "Recommendation as to

Appropriate Discipline."            The referee said that taken alone, the

violation of Count Eight would merit a private reprimand, and

the    violation    of    Count     Nine    would    clearly      merit      a   public

reprimand.       The referee recommended that when taken together,

and considering the ABA Standards for Imposing Lawyer Sanctions,
a public reprimand was appropriate.

       ¶50     As to the appropriate sanction, Wisconsin adheres to a
system    of    progressive     discipline.          See    In    re    Disciplinary

Proceedings Against Converse, 2006 WI 4, ¶37, 287 Wis. 2d 72,

707 N.W.2d 530.          Attorney Arellano has been the subject of a

prior    private    reprimand.        We   agree     with   the    referee       that   a

public       reprimand    is   an    appropriate       sanction        for    Attorney

Arellano's misconduct.


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        ¶51    We turn next to the issue of costs.                    Assessment of

costs in OLR matters is governed by SCR 22.24.                              Our general

policy is that upon a finding of misconduct it is appropriate to

impose all costs,          including     the    expenses      of   counsel     for    the

office of lawyer          regulation,     upon    the    respondent.          In cases

involving      extraordinary     circumstances          the   court    may,     in    the

exercise of its discretion, reduce the amount of costs imposed

upon a respondent.         SCR 22.24(1m).

        ¶52    The   OLR filed   its     statement       of   costs    on    August    6,

2012, listing $40,960.49 in costs.                The OLR concedes that there

are extraordinary circumstances                present    that     justify     reducing

the   amount     of    costs   imposed    on     Attorney      Arellano,       in    part

because OLR voluntarily dismissed six of the 14 alleged counts

of misconduct prior to the evidentiary hearing.                        The OLR thus

recommends this court impose on Attorney Arellano half of the

costs, or $20,480.25, explaining that most of the OLR's trial

time was spent on claims on which the OLR did prevail.

        ¶53    Attorney Arellano filed a timely objection, asking the

court     to    impose    no   costs    at     all,     and   asserting,        in    the
alternative, that imposition of no more than 10 percent of the

costs is warranted.
      ¶54      In exercising our discretion regarding the assessment

of costs, we consider the submissions of the parties and all of
the following factors:

           (a)        The number of counts charged, contested, and
      proven.

               (b)    The nature of the misconduct.

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                                                                          No.    2011AP443-D


           (c) The level of discipline sought                               by     the
      parties and recommended by the referee.

          (d) The    respondent's                  cooperation        with         the
     disciplinary process.

             (e)     Prior discipline, if any.

             (f)     Other relevant circumstances.
See SCR 22.24(1m).

      ¶55     Applying       these          factors,          we      observe            that

SCRs 22.24(1m)(a)-(c) are relevant here.                      The complaint alleged
14   counts    of     misconduct      and    sought      revocation         of     Attorney

Arellano's     license      to    practice       law.     The      referee       ultimately

concluded, and we agree, that Attorney Arellano committed two

counts of misconduct, warranting a public reprimand.                               Without

minimizing the seriousness of Attorney Arellano's professional

misconduct,     it    was   far     less    serious      and    of    a    significantly

different nature than originally alleged.

      ¶56     As the litigation proceeded, one witness changed her

story and conveyed exculpatory evidence to the OLR's retained

counsel     that    had   not     been    disclosed      to     the   OLR       during   its

investigation.        The OLR promptly disclosed these developments to
respondent's counsel resulting in the dismissal of six of the 14

counts.       Two counts were dismissed at trial when one of the

grievants did not appear in person and the referee concluded

telephonic     testimony         should    not    be    permitted.          Under    these

rather extraordinary circumstances, we agree that a reduction in

costs is warranted in part because of the disparity between the

allegations and recommended discipline in the complaint and the

ultimate conclusions of this court.

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     ¶57     That   said,      we    reject     Attorney     Arellano's         assertion

that we should assess no costs at all.                     We are not persuaded

that the counts on which Attorney Arellano prevailed were wholly

without prosecutorial merit or that the OLR's costs pursuing

those charges were unreasonable or unnecessary.                        The OLR was

confronted      with    four        separate     grievants     who    each        alleged

Attorney Arellano engaged in extremely serious misconduct.                             The

only evidence given for the charge of over-litigating is that

the OLR did not prevail on all counts, in part because one

grievant essentially recanted and another refused to appear.
     ¶58     Attorney Arellano litigated this case vigorously as is

his right.       He cannot, however, be deemed wholly cooperative

with the disciplinary process given our determination that he

violated      SCR      22.03(6)        via       SCR    20:8.4(h)          by      making

misrepresentations to the OLR and to its District 9 Committee or

members thereof in the course of the OLR's investigation of the

N.S.M.   grievance,     a   matter      comprising      more   than    half        of the

alleged counts of misconduct.                 See SCR 22.24(1m)(d).              Attorney

Arellano      has      also         been       disciplined      before.                See

SCR 22.24(1m)(e).        These factors weigh against a reduction in

costs.

     ¶59   On    balance,       we     deem     it   appropriate      to    impose      25

percent of the costs on Attorney Arellano, or $10,240.13.                              Our

determination is not the result of the application of a precise

mathematical formula, but is based on our thorough consideration

of the record, the manner in which this case developed, the

OLR's acknowledgement that extraordinary circumstances justify a
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reduction        in    costs,    and     the     factors    established        in

SCR 22.24(1m).

     ¶60    IT    IS   ORDERED   that   Victor    M.   Arellano   is    publicly

reprimanded for professional misconduct.

     ¶61    IT IS FURTHER ORDERED that within 60 days of the date

of this order, Victor M. Arellano shall pay to the Office of

Lawyer Regulation the imposed costs of this proceeding.

     ¶62    IT IS FURTHER ORDERED that the director of the Office

of Lawyer Regulation shall advise the court if there has not

been full compliance with all conditions of this order.

     ¶63    SHIRLEY S. ABRAHAMSON, C.J., and MICHAEL J. GABLEMAN,

J., did not participate.




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