Office of Lawyer Regulation v. Carl J. Schwedler

2017 WI 54

SUPREME COURT OF WISCONSIN
CASE NO.: 2016AP1770-D
COMPLETE TITLE: In the Matter of Disciplinary Proceedings
Against Carl J. Schwedler, Attorney at Law:

Office of Lawyer Regulation,
Complainant,
v.
Carl J. Schwedler,
Respondent.

DISCIPLINARY PROCEEDINGS AGAINST SCHWEDLER

OPINION FILED: June 1, 2017
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
COURT:
COUNTY:
JUDGE:

JUSTICES:
CONCURRED: A.W. BRADLEY, J. concurs, joined by ABRAHAMSON,
J.
DISSENTED:
NOT PARTICIPATING:

ATTORNEYS:
2017 WI 54
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2016AP1770-D

STATE OF WISCONSIN : IN SUPREME COURT

In the Matter of Disciplinary Proceedings
Against Carl J. Schwedler, Attorney at Law:

Office of Lawyer Regulation, FILED
Complainant, JUN 1, 2017
v. Diane M. Fremgen
Clerk of Supreme Court
Carl J. Schwedler,

Respondent.

ATTORNEY disciplinary proceeding. Attorney's license

suspended.

¶1 PER CURIAM. On September 12, 2016, the Office of

Lawyer Regulation (OLR) filed a complaint and motion pursuant to

Supreme Court Rule (SCR) 22.22, requesting this court suspend

Attorney Carl J. Schwedler's license to practice law in

Wisconsin for a period of six months, as discipline reciprocal

to that imposed by the United States Patent and Trademark Office

(USPTO). The OLR asked that we order restitution as described
herein and impose costs on Attorney Schwedler. Upon review, we
No. 2016AP1770-D

agree that it is appropriate to suspend Attorney Schwedler's law

license for a period of six months. Consistent with the terms

of the decision rendered by the USPTO, if Attorney Schwedler

seeks reinstatement of his license to practice law in Wisconsin,

reinstatement may require Attorney Schwedler to demonstrate that

he has made restitution to the client. We decline to impose

costs on Attorney Schwedler.

¶2 Attorney Schwedler was admitted to practice law in

Wisconsin in 1990. He was registered as a patent attorney by

the USPTO on April 19, 1993. He was admitted to practice law in

California in 2006 and resides in California.

¶3 On October 31, 2009, Attorney Schwedler's Wisconsin

law license was suspended for failure to pay State Bar of

Wisconsin dues. On June 8, 2011, his Wisconsin law license was

further suspended for failure to comply with continuing legal

education requirements. Attorney Schwedler's Wisconsin law

license remains administratively suspended. In 2015, the State

Bar of California transferred Attorney Schwedler to "inactive
enrollment" for his failure to timely file a response to then

pending disciplinary charges. He was subsequently disbarred.

On March 18, 2015, Attorney Schwedler was administratively

suspended from practice before the USPTO. He was later excluded

from practice before the USPTO.1
1
The OLR advises the court that "exclusion from practice"
before the USPTO effectively means disbarment. An attorney
"excluded from practice" before the USPTO may petition for
reinstatement no earlier than five years after being "excluded
from practice." 37 C.F.R. §11.60.

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No. 2016AP1770-D

¶4 On September 12, 2016, the OLR filed a complaint

against Attorney Schwedler alleging that, by virtue of the

public sanction imposed by the USPTO on March 21, 2016, Attorney

Schwedler is subject to reciprocal discipline in Wisconsin

pursuant to SCR 22.22.2 On November 30, 2016,3 this court

2
The relevant portions of SCR 22.22 provide:

(1) An attorney on whom public discipline for
misconduct or a license suspension for medical
incapacity has been imposed by another jurisdiction
shall promptly notify the director of the matter.
Failure to furnish the notice within 20 days of the
effective date of the order or judgment of the other
jurisdiction constitutes misconduct.

(2) Upon the receipt of a certified copy of a judgment
or order of another jurisdiction imposing discipline
for misconduct or a license suspension for medical
incapacity of an attorney admitted to the practice of
law or engaged in the practice of law in this state,
the director may file a complaint in the supreme court
containing all of the following:

(a) A certified copy of the judgment or order from the
other jurisdiction.

(b) A motion requesting an order directing the
attorney to inform the Supreme Court in writing within
20 days of any claim of the attorney predicated on the
grounds set forth in sub. (3) that the imposition of
the identical discipline or license suspension by the
Supreme Court would be unwarranted and the factual
basis for the claim.

(3) The supreme court shall impose the identical
discipline or license suspension unless one or more of
the following is present:

(a) The procedure in the other jurisdiction was so
lacking in notice or opportunity to be heard as to
constitute a deprivation of due process.

(continued)
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No. 2016AP1770-D

directed Attorney Schwedler to inform the court in writing

within 20 days of any claim by him, predicated upon the grounds

set forth in SCR 22.22(3), that the imposition of discipline

reciprocal to that imposed by the USPTO would be unwarranted,

and of the factual basis for any such claim. Attorney Schwedler

did not file a response. On March 23, 2017 this court issued an

order directing the OLR to respond to a series of questions

regarding this matter. The OLR filed a response on April 6,

2017.

¶5 We first observe that the USPTO, a federal agency

with its own licensing and disciplinary proceedings, is

(b) There was such an infirmity of proof establishing
the misconduct or medical incapacity that the Supreme
Court could not accept as final the conclusion in
respect to the misconduct or medical incapacity.

(4) Except as provided in sub. (3), a final
adjudication in another jurisdiction that an attorney
has engaged in misconduct or has a medical incapacity
shall be conclusive evidence of the attorney's
misconduct or medical incapacity for purposes of a
proceeding under this rule.
3
Some delay ensued as the OLR sought to accomplish proof of
service. The OLR served Attorney Schwedler pursuant to
SCR 22.13(1), sending, by certified mail, an authenticated copy
of the complaint and motion and the order to answer to the most
recent address Attorney Schwedler had furnished to the State Bar
of Wisconsin. These documents were not returned to the OLR.
The OLR also sent authenticated copies of the documents to an
address on file with the State Bar of California and the USPTO,
again without response.

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No. 2016AP1770-D

appropriately considered "another jurisdiction" for purposes of

our reciprocal discipline rule, SCR 22.22(1). See In Re

Discipline of Peirce, 122 Nev. 77, 78, 128 P.3d 443, 443 (2006),

reinstatement granted sub nom. In re Reinstatement of Peirce,

No. 62091, 2014 WL 4804214 (Nev. Sept. 24, 2014); People v.

Hartman, 744 P.2d 482 (Colo. 1987); People v. Bode, 119 P.3d

1098, 1100 (Colo. O.P.D.J. 2005); In Disciplinary Counsel v.

Lapine, 2010-Ohio-6151, ¶¶12-14, 128 Ohio St.3d 87, 89-90, 942

N.E.2d 328, 330-31.

¶6 Accordingly, we consider the following facts, which

are taken from the OLR's complaint and from the certified

documents attached to the OLR's complaint relating to the

underlying disciplinary proceeding.

¶7 On October 6, 2015, the United States Office of

Enrollment and Discipline (OED) for the USPTO filed a

disciplinary complaint against Attorney Schwedler. Attorney

Schwedler failed to respond and the OED eventually sought a

default judgment. On March 21, 2016, the USPTO issued an order
finding Attorney Schwedler in default, such that he was deemed

to have admitted the allegations in the OED's complaint. The

USPTO then sanctioned Attorney Schwedler for numerous violations

of the USPTO Rules of Professional Conduct. Essentially,

Attorney Schwedler undertook to represent a client, G.Y., in a

patent application, accepted a $1,500 retainer, and then

abandoned the client and the patent application, failing to take

any action on the client's behalf. The Administrative Law Judge

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No. 2016AP1770-D

(ALJ) concluded that Attorney Schwedler violated USPTO Rules of

Professional Conduct, as follows:

1. C.F.R §11.103 proscribes failing to act with
reasonable diligence and promptness in representing a
client. Respondent agreed to take over the
representation of a Client on a [patent] application
and told the Client that he would file a response to
the June 10, 2013, Final Office Action before
September 10, 2013. Respondent failed to file that
response allowing the [patent] application to become
abandoned. After the [patent] application became
abandoned, Respondent made no efforts to revive it.
These lapses constitute violations of 37 C.F.R.
§11.103.

2. 37 C.F.R. §11.104(a)(3) proscribes failing to keep
the client reasonably informed about the status of a
matter. Respondent agreed to submit the appropriate
filings to the USPTO by September 10, 2013, but failed
to do so. This resulted in the [patent] application
becoming abandoned. Respondent did not inform the
Client of this development or that Respondent had not
filed the response. It was only after the Client was
notified by Respondent's former firm of the status
that Respondent resumed communications with the
Client. Such conduct constitutes a violation of 37
C.F.R. §11.104(a)(3).

3. 37 C.F.R. §11.104(a)(4) proscribes failing to
promptly comply with reasonable requests for
information. As noted [above], Respondent did not
resume communications with the Client until after the
Client's son began to ask about the status of the
[patent] application. The Client's inquiries into the
status of the [patent] application were reasonable,
especially in light of the fact that the Client was
notified that the application had become abandoned.
However Respondent's responses, though prompt, were
not compliant with the Client's requests for
information, because Respondent purposely gave the
Client's son incorrect information by indicating that
'everything is normal here' when in fact the [patent]
application had become abandoned.

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No. 2016AP1770-D

4. 37 C.F.R §11.115(d) proscribes failing to promptly
deliver to a client any funds or property that the
client is entitled to receive. After the Client
informed Respondent that responsibility for the
prosecution of the [patent] application had been
transferred to another registered practitioner, the
Client requested that the prototype for the invention
be returned to the Client. Respondent, however, did
not return the prototype to Respondent [sic] as
requested. Accordingly, Respondent violated 37 C.F.R.
§11.115(d).

5. 37 C.F.R §11.116(d) proscribes failing to surrender
papers and property to which the client is entitled
and to refund any advance payment of fee or expense
that has not been earned or incurred upon termination
of the practitioner-client relationship. The Client
agreed to pay Respondent $1,500 in advance for patent
legal services to be rendered. Respondent sent a
retention letter noting the $1,500 fee to the Client,
who promptly paid the fee. Respondent also sent the
Client a September 18th invoice for $1,500, and
described in the September 18th invoice the services
rendered for the [patent] application as follows:
'Response to Office Action from USPTO and filing
continued prosecution application.' However Respondent
never earned this fee, because he never performed the
services agreed to, and described by, the September
18th invoice. After the Client informed Respondent
that his responsibility for the prosecution of the
[patent] application had been transferred to another
registered practitioner, Respondent did not return the
$1,500 fee that the Client prepaid. Accordingly,
Respondent violated 37 C.F.R §11.116(d).

6. 37 C.F.R. §11.804(c) proscribes conduct involving
dishonesty, fraud, deceit, or misrepresentation.
Respondent agreed to represent the Client and file a
response to the June 10, 2013, Final Office Action.
He did not do so. Yet, Respondent sent the Client an
invoice suggesting that he had filed the response and
was continuing with the prosecution of the
application. Then after the Client's son contacted
Respondent regarding the status of the [patent]
application, Respondent sent an e-mail to the son
stating, 'I have everything in order for filing the
response' when in fact, the [patent] application had

7
No. 2016AP1770-D

become abandoned. Such statements were misleading and
constitute conduct involving dishonesty and
misrepresentation in violation of 37 C.F.R.
§11.804(c).

7. 37 C.F.R. §11.801(b) proscribes knowingly failing
to respond to lawful demands for information from a
disciplinary authority. The OED sent Respondent an RFI
that was never answered despite two subsequent
communications prompting Respondent that his response
to the RFI was due. The OED has provided documentation
indicating that Respondent received all three pieces
of correspondence. By failing to respond to the RFI
and subsequent demands for a response, Respondent
violated 37 C.F.R. §11.801(b).

8. 37 C.F.R. §11.804(d) proscribes conduct that is
prejudicial to the administration of justice.
Respondent failed to respond to the RFI. Respondent's
conduct undermines the public's confidence in the
profession's ability to regulate itself and is,
therefore, prejudicial to the administration of
justice in violation of 37 C.F.R. §11.801(d).
¶8 The USPTO decision deemed Attorney Schwedler's actions

"knowing and intentional" and stated that they caused "actual

injury" to the client and warranted "a severe sanction."

Attorney Schwedler was excluded from practice before the USPTO

in patent, trademark, and other non-patent cases or matters.

See In the Matter of Carl J. Schwedler, Proc. No. D2015-38

(USPTO Dir. Mar. 21, 2016). As noted, "exclusion from practice"

is effectively disbarment from practice before the USPTO. The

order states that if Attorney Schwedler were to seek

reinstatement, it may be conditioned, inter alia, upon

restitution to the client.

¶9 The OLR's complaint against Attorney Schwedler alleges

the following counts of misconduct:

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No. 2016AP1770-D

Count One: By virtue of the OED public sanction,
Attorney Schwedler is subject to reciprocal discipline
in Wisconsin pursuant to SCR 22.22.

Count Two: By failing to notify the OLR of his OED
public sanction for professional misconduct within 20
days of the effective date of its imposition, Attorney
Schwedler violated SCR 22.22(1).
¶10 We conclude that the facts of record demonstrate that

Attorney Schwedler violated SCR 22.22(1) by failing to notify

the OLR of his suspension within 20 days of the effective date

of its imposition.

¶11 Under SCR 22.22(3), in reciprocal discipline matters,

this court shall impose the identical discipline unless one or

more of the exceptions enumerated in the rule is shown.

Attorney Schwedler has not made any claim or showing that any of

the exceptions to the imposition of reciprocal discipline set

forth in SCR 22.22(3) apply to this case. The OLR acknowledges

that "identical" discipline cannot be imposed here because

SCR 21.16(1m) does not include "exclusion" from practice before

a court as a form of discipline available in Wisconsin.

¶12 The OLR also asserts that a six-month license

suspension is a proper level of discipline to impose for

Attorney Schwedler's misconduct. The OLR seeks a six-month

suspension, rather than license revocation, because it believes

that Attorney Schwedler's misconduct justifies a substantially

different discipline in Wisconsin, as authorized by SCR

22.22(3)(c). Attorney Schwedler's misconduct involved neglect,

misrepresentation, and failure to refund fees. The OLR asserts
that in Wisconsin, such misconduct warrants a six-month

9
No. 2016AP1770-D

suspension. See In re Disciplinary Proceedings Against Hooker,

2012 WI 100, 343 Wis. 2d 397, 816 N.W.2d 310 (imposing six-month

suspension in reciprocal discipline case for practicing without

a license, and for neglect and lack of competence in a

bankruptcy proceeding); In re Disciplinary Proceedings Against

Coplien, 2010 WI 109, 329 Wis. 2d 311, 788 N.W.2d 376 (imposing

six-month suspension in reciprocal matter for failing to act

with reasonable diligence and promptness in representing a

client, failing to keep a client reasonably informed about the

status of a matter, failing to make reasonable efforts to

expedite litigation consistent with the interests of the client,

failing to respond to a lawful demand for information from a

disciplinary authority, conduct prejudicial to the

administration of justice, and conduct that tends to defeat the

administration of justice or to bring the courts or the legal

profession into disrepute); In re Disciplinary Proceedings

Against Ring, 168 Wis. 2d 817, 484 N.W.2d 336 (1992) (imposing

six month suspension in reciprocal discipline case for failure
to file an appellate brief and failure to keep the client

informed, and lack of candor rising to dishonesty, deceit or

misrepresentation).

¶13 The OLR emphasizes that a six-month suspension

requires a formal reinstatement proceeding before the suspended

attorney can be reinstated to the practice of law.

¶14 We agree that identical discipline is not an option in

this case so a different sanction must be imposed. It is
apparent from the language in the USPTO's decision that Attorney
10
No. 2016AP1770-D

Schwedler's misconduct was serious. The sanction imposed by the

USPTO requires a reinstatement proceeding. Attorney Schwedler

has not responded in this matter and has not challenged the

OLR's recommended sanction. Accordingly, we accept the OLR's

assertion that a six-month license suspension is appropriate and

we suspend Attorney Schwedler's Wisconsin law license for six

months as discipline reciprocal to that imposed by the USPTO.

¶15 The OLR initially asked this court to order Attorney

Schwedler to pay restitution in the amount of $1,500 to G.Y. In

its April 6, 2017 filing, the OLR revised its recommendation and

asks the Court to condition Attorney Schwedler's reinstatement

upon making payment to the client in the amount of $1,500,

consistent with the terms of the USPTO disciplinary order. We

agree and direct that Attorney Schwedler's reinstatement may be

conditioned upon payment of restitution to G.Y.

¶16 Finally, we decline to impose the costs of this

proceeding on Attorney Schwedler. See In re Disciplinary

Proceedings Against Hooker, 2012 WI 100, ¶26, 343 Wis. 2d 397,
816 N.W.2d 310 (noting that in reciprocal discipline cases where

a referee is not appointed, costs are generally not imposed as

there are no referee expenses and the proceedings are less

involved).4

4
The OLR inadvertently requested appointment of a referee,
but later rescinded that request.

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No. 2016AP1770-D

¶17 IT IS ORDERED that the license of Carl J. Schwedler to

practice law in Wisconsin is suspended for a period of six

months, effective the date of this order.

¶18 IT IS FURTHER ORDERED that, to the extent he has not

already done so, Carl J. Schwedler shall comply with the

provisions of SCR 22.26 concerning the duties of a person whose

license to practice law in Wisconsin has been suspended.

¶19 IT IS FURTHER ORDERED that compliance with all

conditions of this order, compliance with all conditions of the

disciplinary order imposed on him by the United States Patent

and Trade Office, In the Matter of Carl J. Schwedler, Proc. No.

D2015-38 (USPTO Dir. Mar. 21, 2016), and a showing that Carl J.

Schwedler has paid restitution to G.Y. may be required for

reinstatement. See SCR 22.29(4)(c).

¶20 IT IS FURTHER ORDERED that the administrative

suspension of Carl J. Schwedler's license to practice law in

Wisconsin, due to his failure to pay mandatory bar dues and

failure to comply with continuing legal education requirements,
will remain in effect until each reason for the administrative

suspension has been rectified, pursuant to SCR 22.28(1).

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No. 2016AP1770-D.awb

¶21 ANN WALSH BRADLEY, J. (concurring). I agree with

the court's mandate but I write separately to state my

disagreement with the court's statement in ¶14 of the opinion

which states, "We agree that identical discipline is not an

option in this case so a different sanction must be imposed."

The United States Patent and Trademark Office (USPTO) excluded

Attorney Carl J. Schwedler from practice. The Office of Lawyer

Regulation (OLR) has advised this court that "exclusion from

practice" before the USPTO effectively means disbarment for five

years. Majority op., fn 1.

¶22 We could indeed impose identical discipline. We could

revoke Attorney Schwedler's license to practice law in Wisconsin

under SCR 21.16(1m)(a). See In re Disciplinary Proceedings

Against Peiss, 2017 WI 49, ¶24, ___Wis. 2d ___, ___ N.W.2d ___,

(Abrahamson, J. concurring, stating that "disbarment in Illinois

appears to be identical to license revocation in Wisconsin.")

Rather, in this case we exercise our discretion and opt to

impose a lesser sanction in the form of a six-month suspension
of Attorney Schwedler's law license. For the reasons set forth,

I write separately.

¶23 I am authorized to state that Justice SHIRLEY S.

ABRAHAMSON joins this concurrence.

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No. 2016AP1770-D.awb