North Carolina State Bar v. Megaro

880 S.E.2d 401

The NORTH CAROLINA STATE BAR, Plaintiff,

v.Patrick Michael MEGARO, Attorney, Defendant.

No. COA22-135

Court of Appeals of North Carolina.

Filed November 1, 2022

The North Carolina State Bar, by Deputy Counsel David R. Johnson, Counsel Katherine Jean, and Deputy Counsel Carmen Hoyme Bannon, for Plaintiff-Appellee.

Patrick Michael Megaro, Pro se, Defendant-Appellant.

COLLINS, Judge.

¶ 1 Defendant Patrick Michael Megaro appeals from an order of discipline entered by the Disciplinary Hearing Commission of the North Carolina State Bar ("DHC") suspending his law license for five years and allowing him to seek a stay of the balance of the suspension after three years if he complies with certain conditions. Because there is substantial evidence to support the DHC's findings of fact, and because the findings of fact support the conclusions of law, we affirm.

I. Procedural History and Factual Background

¶ 2 In 1983, brothers Henry McCollum and Leon Brown were convicted of the rape and murder of 11-year-old Sabrina Buie and sentenced to death. On appeal, the North Carolina Supreme Court granted McCollum and Brown new trials. See State v. McCollum , 321 N.C. 557, 364 S.E.2d 112 (1988). McCollum was retried and again convicted of first-degree rape and first-degree murder. The trial court arrested judgment on the rape conviction and sentenced McCollum to death for the murder conviction. At sentencing, the jury found as mitigating circumstances that McCollum "was mentally retarded, that the offense was committed while he was under the influence of mental or emotional disturbance, that he is easily influenced by others, and [that] he has difficulty thinking clearly under stress."

¶ 3 Brown was retried, convicted of first-degree rape, and sentenced to life in prison. In the trial court's judgment, it recommended Brown receive psychological treatment in prison. On appeal, this Court found no error, but the opinion included the trial court's order denying a motion to suppress which found that Brown "has an I.Q. variously tested between 49 and 65, but has been generally classified as suffering from mild mental retardation[.]" State v. Brown , 112 N.C. App. 390, 393, 436 S.E.2d 163, 165 (1993).

¶ 4 In April 1995, McCollum was represented by Kenneth Rose, an attorney with the Center for Death Penalty Litigation, and attorneys from Wilmer Hale, in filing a motion for appropriate relief ("MAR"). The MAR alleged that an incriminating statement made by McCollum was unreliable due to his intellectual disabilities, which were established by opinions from four mental health professionals.

¶ 5 In January 2002, Rose represented McCollum in filing an amended MAR "based on [McCollum's] subaverage intellectual functioning and significant limitations in adaptive functioning." In support of the MAR, McCollum submitted a 2002 affidavit of Dr. Rogers in which Dr. Rogers averred that "in her 1995 testing McCollum had a full-scale IQ of 68 and significant subaverage intellectual functioning that placed him in the lowest 2-3 percent of the population in overall intellectual functioning." McCollum also submitted a 2002 affidavit of Dr. Rumer, who averred that McCollum "had a history of subaverage scores on intellectual testing with full-scale scores of 56, 61 and 69, and adaptive functioning deficits."

¶ 6 In August 2014, Rose and Vernetta Alston, also an attorney with the Center for Death Penalty Litigation, filed an MAR alleging McCollum was innocent based in part on results of DNA testing done on a cigarette butt found at the scene of the murder; the DNA did not match either brother, but instead matched an inmate "then serving a life sentence for the murder of a woman in the same area as Buie, a month after Buie's murder." Brown filed a similar MAR through separate counsel. The trial court granted McCollum's and Brown's MARs, vacated their convictions and judgments, and released them from prison after having served 31 years.

¶ 7 Attorneys Mike Lewis, Mark Rabil, and Tom Howlett agreed to represent McCollum and Brown on a contingency fee basis in civil litigation for the alleged misconduct of law enforcement officers involved in the investigation and prosecution of the brothers. Rose, Alston, and attorneys with Wilmer Hale agreed to represent McCollum and Brown on a pro bono basis to file pardon petitions with the governor and to seek compensation in the Industrial Commission as persons wrongfully convicted of felonies, pursuant to N.C. Gen. Stat. § 148-84. On 11 September 2014, Rose and Alston filed petitions for pardons of innocence on behalf of the brothers. On 15 September 2014, Rose and Alston received notice from the Clemency Administrator that "[a]ll necessary documents have been received and this request is now being processed. You will be notified when a decision has been made on this request." After McCollum's and Brown's cases caught the attention of the media, "McCollum and Brown began receiving charitable donations and financial assistance from various sources[.]"

¶ 8 In January 2015, Kim Weekes and Deborah Pointer, who were not attorneys and who referred to themselves as "consultant advisors," contacted Brown's sister, Geraldine Brown Ransom, claiming they could help McCollum and Brown. Weekes and Pointer entered into an agreement with Ransom, who was not a guardian for either McCollum or Brown at that point, to serve as activists for the brothers and to assist with their pardon process. Weekes and Pointer notified Rose that they were authorized to represent McCollum and Brown "in all and any of the Civil/Litigation of the Pardon/Fundraising of NC matters."

¶ 9 Weekes and Pointer contacted Defendant about representing the brothers. Defendant "read news accounts of McCollum and Brown's cases, reviewed transcripts of their MAR hearings that he found online, and did preliminary research on their cases." Before Defendant met with McCollum and Brown, Pointer warned Defendant that Ransom requested that Defendant refrain from discussing money amounts in front of the brothers. Pointer also told Defendant that Ransom would give the brothers a monthly stipend. Defendant entered into a representation agreement with McCollum, Brown, and Ransom. At the time they entered into the agreement, petitions for pardons had already been filed for McCollum and Brown. The representation agreement provided the following: Defendant would collect a contingency fee of 27-33% of any monetary recovery from Robeson County, the Red Springs Police Department, and the State of North Carolina; McCollum and Brown were conveying to Defendant an irrevocable interest in net proceeds arising from any recovery; and Defendant was entitled to the contingency interest in the outcome of the case regardless of whether McCollum and Brown terminated the representation agreement.

¶ 10 Defendant began working with Multi Funding, Inc., to obtain "immediate funding through loans" for McCollum and Brown. Defendant advanced $1,000 cash to each McCollum and Brown and facilitated the brothers each getting loans from Multi Funding for $100,000 at 19% interest, compounded every six months. Defendant ensured that Weekes and Pointer were paid $10,000 from the initial loan proceeds to the brothers. Defendant sent letters to Rose and Howlett, "warning them to never contact McCollum and Brown again as it would violate the ‘rules of ethics’ and would be ‘actionable as tortious interference of contract.’ "

¶ 11 After the governor granted pardons of innocence to the brothers, Defendant filed a joint petition in the Industrial Commission seeking compensation for McCollum and Brown, pursuant to N.C. Gen. Stat. § 148-84. The attachments to the petition were almost exclusively the work product of Rose and Alston. Defendant also filed suit in the United States District Court for the Eastern District of North Carolina on behalf of the brothers against various parties alleged to be responsible for their wrongful conviction and incarceration. In August 2015, Brown, who suffers from bi-polar disorder and schizophrenia, was hospitalized after a breakdown. Defendant filed a petition in Cumberland County to have Brown declared incompetent and proposed that Ransom be appointed Brown's guardian.

¶ 12 On 2 September 2015, after a brief hearing, McCollum and Brown were each awarded $750,000, the statutorily mandated amount of compensation under N.C. Gen. Stat. § 148-84. Defendant was issued a check for $1.5 million; Defendant took $500,000 as a contingency fee. The brothers were left with $500,000 each, and of this money:

Defendant used nearly $110,000.00 each of McCollum and Brown's Industrial Commission award, totaling $220,000.00, to repay the loans he facilitated their obtaining ....

Defendant charged a combined total of $21,173.88 in costs and expenses to McCollum and Brown for the Industrial Commission process. These charges included costs related to the pardon process and related to Brown's incompetency proceeding.

Defendant used $25,972.14 of the Industrial Commission award to repay money he and his firm advanced to McCollum and Brown prior to their Industrial Commission award[.]

¶ 13 After these deductions, Defendant disbursed $358,363.28 to McCollum. After McCollum spent all the funds, Defendant helped McCollum obtain a second loan for $50,000 at 18% interest, compounded every six months. Defendant facilitated McCollum obtaining a third loan for $15,000 at 18% interest, compounded every six months. After Ransom was removed as Brown's guardian for mismanaging his funds, Defendant helped Ransom "get a $25,000.00 loan from [Multi Funding] against any future recovery made by Brown, with the loan proceeds sent to [Ransom] purportedly for Brown's rent." As a result of the loan, Multi Funding perfected a lien for $25,000 against any future recovery made by Brown.

¶ 14 On 1 February 2017, Derrick Hamilton, a friend of and occasional videographer for Defendant, wired Defendant $30,000 – $20,000 of which was for...