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Misappropriation and a long disciplinary history lead to disbarment

A southern California lawyer who was dismissed from the Lawyer Assistance Program for twice tampering with urine tests was disbarred for misappropriating more than $120,000 from her clients. JACQUELINE STATEN [#175733], 47, of Carson also was ordered to make restitution in what was her fourth discipline, beginning with a 2006 misdemeanor battery conviction. The disbarment took effect Oct. 20, 2011.

While acknowledging that Staten “has had a traumatic life” with severe, ongoing problems including bankruptcy and a bipolar diagnosis, State Bar Court Judge Richard Honn recommended her disbarment because of the egregious nature of her misconduct.

Both matters that led to Staten’s disbarment involved divorces.

In the first case, she received a check for $304,620.25, representing the proceeds of the sale of her client’s family residence. Without the knowledge of her client, the estranged husband or his lawyer, Staten deposited the money in her personal account. The next day, she moved all but $5,100 into her client trust account, misappropriating $5,100. A few weeks later, the balance in her personal account was -$829.72. Several months later, Staten misappropriated another $74,798.85, for a total of $79,898.85. Although she ultimately disbursed more than $300,000 to her client and her husband, she repeatedly allowed the balance in her client trust account to fall below the required amount.

When a new attorney replaced Staten, the court ordered her to account for client funds and to transfer the remaining community property to the new lawyer. Staten provided an inaccurate accounting and wrote a check for $50,000 against insufficient funds.

The bar court found that Staten failed to deposit or maintain client funds in trust, misappropriated almost $80,000, distributed funds without the required court order and committed three acts of moral turpitude.

Staten substituted in to a second dissolution matter and by court order received $143,726 (from the sale of her client’s home) that was being held in trust for the client and her husband. She was ordered to not disburse any of the funds. A couple of months later, the client fired Staten and rehired the original lawyer, but Staten did not return the money, as ordered by the court. Instead, the balance in her trust account dropped, and she misappropriated $40,951, although she eventually replenished more than $27,000.

The Murrieta Police Department obtained a court order freezing Staten’s trust account and collected $129,803.19, the amount the account held at the time.

The bar court found that Staten failed to hold client funds in trust or distribute those funds and she committed acts of moral turpitude by misappropriating client money and disobeying court orders.

In addition to the 2006 conviction, Staten has been disciplined for failing to refund unearned fees and perform competent legal services, and she misused her trust account, making it possible for her roommate to use the account to pay personal expenses.

In mitigation, several witnesses, including one of the former divorce clients, testified about Staten’s good character, she performs extensive charitable work, and she cooperated with the bar’s investigation. She uses medication to control her depression and has suffered many setbacks in her life.

For example, in 2003, at her law partner’s request, she signed a lease for the firm but that night her partner moved out with all the employees. As a result, Staten had a series of mental health difficulties caused by the stress associated with sorting out the former firm’s obligations. She also declared bankruptcy, lost her house, moved her home or office about 10 times during the next several years and was forced to send her daughter to live with her mother because she could not provide a stable living environment. 

Despite those circumstances, Honn said the amount of money misappropriated was significant and Staten still owes money to her clients. “The the court finds no compelling reason,” Honn wrote, “to recommend a level of discipline short of disbarment.”