Yarber s Attorney Carl A. Capozzola s California State Bar

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					STATE BAR COURT                              OF CALIFORNIA

                                                               April6,   2011

In Re:   84-C-I8979         Inthe Matter     of   Carl   A. Capozzola

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                                                                                                                              APR 2 O19EB
                                                                              Ba¡ Misc. 4746                              Laurencc P,¡ Gill, Clerk

                                    IN THE SUPREME COURT OF lHE STATE OE CEIiTORNIA

                                                                               IN BANK

                                         IN THE MATTER OF CARL ANTHONY CAPOZZOLA

                                           A MEMBER OF lHE STATE BAR OF CALIFORNIA

                                  It ls ordered that Carl Anthony Capozzola                                   be suspended from the

                    practice          of law for          two      years.                He   is   ordered   to take and pass the
/'.                 professional Responsibllity Examination rrithin two years of the
                    effective date of this order. (See Segretti v. State Bar ('l976) l5
                    Cal   .3d B7B, 891             fn.    8.   )    Thi        s order i s effecti ve forthwi th.

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      ¡hov¡¡¡ tiy the rccordr c,f ury <iíf,icc
         t9itness my i:and and the s:al of the ?rr-,ri             rotirr:

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                                                           ilüELtC marTER
                                                                  ÍFl¡    ft    T?       ì-fir TR\.

                                                                          I/ìAY         isct:'
  3                                                                  STATE BAR COURT.
                                                                      cl-ERK'S OFFTC,E /),1
                                                                         LoS ANGã¿Esffi



  7                                       srArE BLrl]o.u?(r   ,

  8                              THE STATE BAR OF CALIFORNÏA

  9                                   HEARING DEPARTMENT


11        In the lrlatter of                               B4-C-34       LA
                                                      (gar Misc. 4746)

13        A Member of the State Bar.
15               The above entitled       matter came on regularly             for hearing
16        before this Hearing Referee at 6 p.m. on l4arch 23, 24 and 25,
t7        I9B7 and for oral argument aL 4 p.m. on April 22, 2987.                          The

18        Ïrearing was presided by    AIEXANDR.A, LEf CHTER,       Principal Referee.
19        Present at said hearing were WILLIAM A. DAVIS, Esq., Examiner for
20        the State Bar, Gary Barthel, assistant to the Examiner;                        CARL À.

27        CAPOZZOLA,   Respondent, and PAUL CARUSO, Esq., VICTOR KENTON, Esg.
22        and LILY BARRY, counsel- for Respondent.
23               The hearing on I'farch, 23, 24 and 25, L987 was reported by
24        Kathryn, Klein,    CSR. The argument on ApriL 22, 7987 v/as reported
)ç,       by Marie Strickland,     CSR.

26               After hearing and considering the evidence presented, the
27        bri-efs filed,    and the oral argument made, by tire parties,                     this


 1   Hearing Referee makes the following findings of fact         and

 2   reconrmendation:
 3                                PRELIM]NARY FACTS

 4          I.   Respondent, CarI A. CapozzoLa, was admitted to the
 5   practi-ce of law in California     in June of 1969.
 6          2.   On January 26, 1984, Respondent pled guitty       to    one

 7   count of violation of 18 USC 64L (unlawful conveyance of
 8   government records) and one count of 1B USC L5Ø3 (obstruction of
 9   justice).
10          3.   On March L9, 1984, Respondent was given a two-year

11   suspended sentence, and placed on probation for five         (5) years,
L2   on condition that Respondent be incarcerated for two months, and
13   provide 15ØØ hours of community service as a lawyer, paralegal or
T4   legal assistant during the first      three years of probation, and
15   pay the prescribed fine
16          4.   On May lB, 7gA4, the Supreme Court placed Respondent on

17   interim suspension effective      June L9, L9B4 and referred the
18   following issues to the State Bar for hearing, report         and

i9   recommendation: (a) lfhether the facts and circumstances
20   surrounding Respondent's conviction of lB USC 64L involved moral
2T   turpitude or other mÍsconduct warranting discipline:   and (b) the
22   degree of discipline warranted by tire facts and circumstances
23   surrounding Respondent's conviction of fB        USC I5Ø3.


25                 SURROUIJDING   VIOI,ATION OF IB USC 641

26          5. In January 1982, one Michael Glasser told Respondent
27   that he had large sums of cash and wanted to deposit the monies
28   in a bank without fitling currency transaction reports.

                           t                                {
     I   Respondent told l,lichael Glasser that what he wanted v¿as illegal
     2   Respondent inquired about the source of Glasser's cash, but
     3   Glasser refused to reveal his source.
     4             6.   In April L982, Respondent received a telephone
     5   conversation from a friend of his, Gerald Scotti, who was an
 6       agent with the Drug Enforcement Agency. The conversation
 7       primarily      centered on their mutual interest         in sports.     Toward

 B       the end of the conversation, Respondent informed Scotti that
 9       Glasser had approached him with a large sum of cash. Respondent
10       told Scotti that he was suspicious that Glasser may be involved
11       in illegal- activity,      and asked Scotti if he could check out
T2       Glasser for him, âs Respondent was interested in possibfy having
13       Glasser invest in certain business opportunities,                including   a

I4       sports franchise.
15                 7.   Respondent did not ask Gerald Scotti to check out any

16       other person.
T7                 B. Sometime later Scotti informed Respondent that Glasser
18       \^/as   under investl-gation and advised Respondent to stay ah¡ay from
19       him.      Without Respondent's inquiry,     Scotti further informed
20       Respondent that a Barbara Mouzj-n and a v/oman name "Dottie" were
2t       known associates of GIasser.

22                 9.   Barbara lvlouzrn was a new client       of Respondent.
23       Respondent had been told by Barbara Mouzin that she was employed

24       v¡ith a wholesale dress chain named Mr. C's, based in Miami,
25       Florida.       She had afso informed Respondent that she v¡as involved

26       with Glasser in business investrnents.
27               IØ.    Respondent informed Barbara }iouzin that Giasser          tr{as

28       under investigation      and that she was listed         as a   known

                        J                               {
                        \                               t{

     1   associate o¡ Glasser.       This formed the basis of Count One of the
 2       indictment to which Respondent pled guilty.
 3             1I.   lfhen Respondent asked Scotti to check out Glasser, he
 4       had no intent to divulge the informati-on to anyone, but sought
 5       it to deterrnine if he should assist Glasser in making business
 6       investments.       Respondent had never heard of the confidential
 7       computer system known as      NADDIS.

 8             L2. !'fhen Scotti mentioned Mouzin's name, Respondent
 9       believed he had a duty to inform his client,         Barbara Mouzin, of
10       what he had fortuitously      learned about the Drug Enforcement
11       Agency's suspicion of her as a known associate of Glasser,               and

T2       to give her legal advice accordingly.
13             I3.   Gerald Scotti testified       that he had authority to access
T4       NADDIS   and to obtain the confidential- information,      and    that    he

15       had the authority to convey the information to others,

I7             L4.   In July of 1982, the United States Attorney began
18       investigati-ng the circumstances of the release of        NADDIS

19       ínformation by Scotti to Respondent. Respondent vo.Iuntarily
20       appeared before the U.S. Attorney and gave a truthful            statement
2t       concerning the circumstances of his receipt of the information
22       from Scotti and his communÍcation with Barbara Mouzin.
23            15. Approximately eighteen months later Respondent             was

24       indicted of violating     18 USC 64J-, for unlawfully conveying to
25       Barbara I'iouzin governrnent information.
26            16. Gerald Scotti rvas neither prosecuted nor disciplined
27       administrativel-y    for giving Respondent the information.

                             (                               {.

     1           17    .   The facts and circumstances of Respondent's violation
     2    of 18      USC 641     do not involve moral turpitude or other misconduct
     3   warranting discipline.
     4                        FINDINGS RE THE FACTS AND CIRCUMSTANCES

     5                        SURROUNDING VIOLATION      OF 18 USC I5Ø3
     6           18.       Tn the Spring of 1982, Respondent was retained by
     7   Barbara l-{ouzin to provide legaI advice and representation.
     8   Respondent advised Mouzin that if criminal charges \¡¡ere
     9   instituted         against her for involvement in money-laundering,             she

 10      ivoul-d need substantial        monies for bail,    attorneys'     fees   and

11       costs   .

12               19. Thereafter, monies were sent from time to time to
13       Respondent by Mouzin through her agents and friends for use in
'14      defraying legal fees and costs.
15               2Ø. Respondent deposited al-1 monies received from or for
16       Mouzin into his trust          account.
T7               2I.       In June L982, Mouzin and her associates were indicted
18       by the Federal Grand Jury.           Respondent advised Mouzin to
19       surrender to the authorities.             Despite his advice, Mouzin did not
20       surrender but fled to l"iexico, and was thereafter               arrested.
2t               22.       In July 1982, the Government     corn¡nenced   an investigation
22i      into the misconduct of government agents and others during thg
23       undercover investigation          of Ivlouzin and her associates.
24       Respondent became the subject of the investj-gation because he had
25       received confidential          information from Geral_d Scotti,       a   DEA

26       agent (as set forth in paragraphs 6 though 17 above).
27            23. Throughout the investigation              of Respondent over the
28       follorving year and a hal-f , there was netvspaper and television

              publícity   of the investigation
                                             into Respondent's alleged
              involvement in money-Ìaundering and drugs.
                    24- Respondent was not, and had never been, invor_ved in
              money-ì-aundering or drugs, and. had never assisted anyone in
              finding a bank which woul-d accept cash without compJ_ying with
              currency reporting requirements. ln fact, Respondent had tol_d
              both Gl-asser and Mouzin that depositing funds in a bank without
      :il     complyi-ng with the currency reporting requirements was irtegar
      ell     and that he coul_d not assist them.
                    25. After her arrest Barbara Mouzin told Respondent that
 11     ll    she recognized one of the government agents as one of the two
              gunmen who robbed her of ç7ØØ,ØØØ in cash. Respondent rel-ayed
 "ll          his client's allegation to the United States Attorney's office.
 l;ll              26. I¡lhen the U.S. Attorney's office did nothing in response
             to this i-nformation, Respondent was concerned for his safety
 ïll         because he believed that the agent who robbed his client knew
             that Respondent had informed the Government of the agent's
 i;ll        invol-vement in the robbery.
                  27.  In August of IgB2, one of the government agents
             assigned to investigate Barbara Mouzin and Respondent, who had
             resigned from government emptoyment within the preceding 3Ø days,
             was killed whil-e parachuting. Among his personar effects the
             Government di,scovered conclusive evid.ence that said former agent
íil          had been invorved in the ç7ØØ,ØØØ robbery of Barbara Mouzin
                  28'   rn l-ate August 1982, Respondent learned that the United
;:/l         states Attorney's office was desirous in joining him as a
2?il         co-conspirator in a pending indictment agai-nst major drug dealers
             and money-launderers to enabl-e prosecution of Respondent und.er

      i    the Racketeer fnfluence and corrupt organization Act ( Rrco) .
     2          29. Joseph F. walsh, a member of the state Bar who was on
     3     the Pederal rndigent Defense paner, and who did not know
     4     Respondent, Ïrad been asked to represent a defendant, Dorothy
     5     Hackett, before the united states Magistrate, despite the fact
     6     that said defendant had retained private counsel to represent
     7     her.     Barry utsinger,
                                 said defendant's counser, \das unabre to
     I     make the appearance on Augrust 26, L9B2 and had asked Respondent

     9    to make a special appearance for him. lVhen Respondent appeared,
 10       he was informed that the arraignment would not take place until
 11        2tØØ p.m. that afternoon.  After Respondent left, and after
 l2       Joseph Walsh had j-nterviewed defendant Hackett, Assistant United
 13       States Attorney Robert Perry approached Walsh and informed him
 t4       that the Government \,vas interested in offering a deal to Dorothy
15        Hackett, whereby if Dorothy Hackett would testify against
16        Respondent, and woul-d impticate him in the conspiracy, 99 of the
I7        felony counts against Hackett would be dismissed, and Hackett
18        woul-d be all-owed to plead guilty   to reduced charges and given
19        other consideration in terms of sentence.
20                Joseph v{alsh berieved that the u.s. Attorney's offi-ce had
27        arranged for his appointment, despite the fact that Hackett had
22        counsel and dj-d not qualify for representation by the indigent
23        panel, in order to be abl-e to com¡nunicate rvith a party
24        represented by counsel- without the knowledge or consent of such
25        counse-l-, and in violation of the Rul-es of Professional Conduct.

26                Joseph $/alsh informed Dorothy Hackett that if   the Government
27        had manipulated his appointment to communj-cate with her rvithout
28        counsel's consent, such conduct would be grounds for a motion to

      I    dismiss and therefore he courd not represent her, and that she
     2     shoul-d retain counsel- who was free of any conf lict in the matter.
     3           3Ø. Upon learning of said efforts of the Assistant United
           states Attorney to enabre Respondent's prosecution as a
           co-conspirator with major drug dealers, Respondent was extremely
           fearful that he would be índicted on the basis of perjured
     8           rn view of what he had l-earned, Respondent was concerned
     9    that. one or more of the drug dealers under indictment might give
 10       perjured testimony against him to save himself or herself from
 11       conviction and incarceration.
 t2             31. Geral-d Scotti,      the former   DEA   agent who was   a

 13       government witness in the investigation           of Respondent, testified
T4        that the attj-tude of certain       agents at that time was such

15        that they would rattier "nail-" (bring charges against) a member of
16        the defense bar than prosecute drug dealers or money-launderers,
I7        because the defense lawyers v/ere regarded as "the enemy". Scotti

18        furttrer testified      that his superiors l-ied to hj-m during the
19        investigation       regarding Respondent's alleged activities.
20              32. Respondent believed also that there were corrupt
2I        government agents among those assigned to investigate hir¡.                He

22        did not trust the Government to protect him against unfounded
?3        accusations.        Respondent's state of mind had a reasonable basis,
24        but affected his judgment.
25              33. The prolonged investigati-on and the inaccurate
26        continuing publicity       caused Respondent and his family great
27        stress.    Respondent had five minor children whose lives             in
28        school and at home \dere affected by the intrusive          publicity.

                                 {                                     :Á

     i                34. During this period Respondent had a busy practice which
     2         demanded       his fulI-time   attention.       Additionally,     he was beset by
     3         a series of family tragedies.            Respondent's mother-in-lav¡ became
     4         ill   and died.       Respondent's father became ilt           rvith botulism in
     5         July of 1982, and was ín critical             condition for the folJ-owing six
     6        months. Respondent travelled            frequently to and from Colorado
     7        betrveen JuIy I9B2 and January 1983 to be with his father.
     8        Respondent's father died in January of 1983 as a result of the
     9        Iingering illness.                                   @
 10                  35   .    Respondent became -senræ+tf         depressed.     He experienced
 11           extreme stress and anxiety throughout the government's lengthy
 T2           investigation.         He suffered severe insomnia, nervousness, and'
 13           paranoid ideation,        among other psychological disturbances.               The

'14           internal        stresses resulted in physi-cal manifestations j-n the form
15            of a skin disorder and stomach ulcers, âs welf as in a temporary
16            breakdown (aberration) of judgment.
17                   36. lIhil-e the grand j.rry investigation               was ongoing in 1983,
18            Respondent learned that the Government was making inquiries                     of
19            the persons who brought legal fees and costs to his office                     on

20            behal-f of his client.          Respondent advised individuals          who

2T            informed him of these inquiries            not to tell        the Government
22            anything.        Respondent wrote to Janet Warren while she was
23       it
              incarcerated advising her not to make any statements to the
24            Government. Respondent had been provided psychiatric                    records by
25            I{arren's husband which indicated that she was mentally
27       il          37. In June of 1983, Respondent gave the U.S. Attorney his
¿ó            decfaration wherein he stated that he received $137,ø53.53                     on

                          i                                6

     I   behalf of Mouzin, and listed         the names of the individuals    who

     2   brought the monies into his office,            except for Brian Belton.    In
     3   preparing the declaration,         Respondent had relied on his office

 4       staff to compile the amount and list           of names, and Brian Belton's
 5       name had been        omitted inadvertently.
 6             38. After furnishing the Declaration, Respondent learned
 7       that Brian Belton had been subpoenaed by the Grand Jury to
 8       testify.      Respondent, because of his distrust        of the Government,
 9       became anxious that his inadvertent omission of Bel-ton's name

10       might be used as a basis to indict him and advised Belton not to
11       divulge the fact that he had brought any money from Mouzj-n to
t2       Respondent.

13             39. In advising Warren and Belton not to testify            and not to

l4       cooperate with the Government, Respondent sought to avoid
15       unjustified     indictment and prosecution as a co-conspirator with
16       major drug dealers notwithstanding his innocence of any
T7       wrongdoing.
18             4Ø. Respondent did not act from any evil or corrupt motive,
19       nor from any motive for personal gain or advantage. He acted
20       from a motive to protect himself against unjustified prosecution
2T       and to protect his family from the devastating consequences of
22       such unjustified        prosecution of crimes he had never committed.
23             4I.     In the fall    of f983, Respondent fearned that Belton and
24       Cordes planned to kil-l       Michael Glasser, who was a key
25       prosecution witness.         Respondent felt    it was his duty to advise
26       the Government. Respondent cooperated wíth the Government in its
27       investigation        of Belton and Corcles, by consenting to be equipped
28       with a hidden recorder and by recording conversations with


 I   Belton.      Respondent cooperated at great risk to hinself,          and not
 2   in exchange for any immunity or dismissal of charges. As                  a

 3   result of Respondent's cooperatj-on Brian Belton and Cordes were
 4   arrested for conspiracy to violate the civil           rights of, Glasser by
 5   kitling   him.
 6         42.      In January of L984, Respondent was indicted of         one

 7   count of obstruction of justice       (   18 USC L5Ø3) .     Respondent

 8   immediately acknowledged his wrongdoing, forfeited              possibly
 9   meritorious defenses, and pled guilty          to concealing the identity
10   of Be1ton as a person who brought monies to him on behalf of
11   Mouzin.
T2                         FINDINGS OF FACT RE MIT]GATIOTT

13         43. Respondent has no prior discipline,              nor have any
I4   disciplinary     proceedings been instituted      heretofore against           hJ-m

15   for professional misconduct; nor has Respondent been sued by any
16   of hís clients       for malpractice despite the fact that he has
T7   represented thousands of clients          over a l5-year career.
18         44. Respondent's misconduct occurred under extenuating
19   circumstances. His acts were the result of extreme psychological
20   stress due to (a) his belief       and overwhelming fear that the
21   Government was desirous of indicting          and prosecuting him for
22   violations     of crimes of which he was innocent, and would resort
23   to any rneans to accomplish its purpose; (b) the inaccurate                   and

24   continuing adverse publicity      and its deterimental effect upon his
25   wife and five chj-ldrenr (c) fris distrust        of the motives of
26   witnesses who would be tempted to give untruthful- testimony in
27   return for dismissal of charges pending against them, and (d) the
28   trauma and depression caused by the illness          and death of his


     I    father and the death of his wife's mother.
     2         45. Respondent's conduct in advising Belton and Warren not
     3    to cooperate in the Government's investigation was not to thwart
     4    justice, but was motivated by Respondent's desire to prevent
     5   miscarriage of justice and wrongful prosecution for crimes which
     6   he had not committed.
     7        46. Respondent had, and continues to haver ârr excellent
     8   reputation j-n the community where he practiced and lives.
     9         47. The evidence of Respondent's good character is
10       overwhel-ming and uncontroverted.         Numerous distinguished      judges,
11       lawyers and law enforcement officj-als        testified    that they have
t2       known Respondent for a long time, are fully            aware of his
13       conviction,     and continue to hol-d him in high regard.        All of the
T4       judges who testified     for Respondent stated that they hoped
15       Respondent would be allowed to resume his practice and appear in
16       their Courts again.      Additionally,    Respondent furnished more than
I7       7Ø character Ietters     from el-ected officials,       Iawyers, judges   and

i8       other persons who have known Respondent professionall-y           and

19       socially    for a long time and knew of his conviction.
20             48.     Respondent has been candid and cooperative with the
2t       State Bar throughout these proceedings.             Soon after referral- of
22       this matter by the Supreme Court for hearing, Respondent
23       vofuntarily    and without arvaiting for formal- discovery delivered
24       to the State Bar tape recordings of conversations with witnesses
25       and submitted to i-nterrogation by the State Bar Examiners.
26            49. The conduct occurred approximately four (4) years â9o,
27       and considerable time has passed since Respondent's aberrant
28       behavior.


      I          5Ø. Respondent's conduct did not harm any clj-ent or any
     2     other person or entity.         It harmed only himself.
     3           5I.   There has been undue delay in bringing this matter to
     4    hearing.     The matter was referred to the State Bar in lr{ay 1984
     5    and the State Bar coul-d have and should have commenced the
     6    hearì-ng prior to January 1986, when the new Standards came into
     7    ,effect.  The State Bar had access to Respondent's cooperation                 and

     8     testimony, the tape recordings j-n his possession, the pre-
     9    sentence memorandum, and all of the material witnesses incÌuding
 10       Barbara Mouzin, Brian Belton, Janet Warren, in early 1985.
11              52. The delay has been prejudicial               to Respondent who has
t2        been on interím suspension since JuIy L9, L984 awaiting such
13        hearing.
14              53.    Respondent has rendered substantial           community services
15        throughout his professional career.
16              54. Respondent has suffered the ignominy of conviction,                  and

t7        has been punished for his offense, by confinement for two months
18        j-n the federal institution at Boron, California, and by payment
19        of the prescribed fine.         He has complied with his probationary
20        condition that he render        L5ØØ   hours of community service.       As of
2T        the time of the hearing he had rendered in excess of L53Ø hours
22        to the Long Beach Legal Aid Foundation, and notwithstanding his
23        compliance with the condition of probation, continued to
24        vofunteer his services to said Foundation.
LJ                                      COI.TCLUSIONS OF LAI,V

26               1.    The facts and circumstances surrounding Respondent's
27        violation    of tB   USC   64I do not involve rnoral tr-rrpitude or other
28        misconduct warranting discipJ-ine.


      1                 2.    Respondent's violation     of IB     USC I5Ø3       occurred under
     2      extenuatj-ng circumstances and involved substantial mitigating
     3      factors.  His conduct was an aberration, did not harm anyone, and
     4     resulted from extreme psychological stress. Respondent's conduct
     5     dÌd not grow out of any iinproper motive, but out of his
     6     reasonably based state of mind and overwherming fear that he
     7     may be indicted and prosecuted without justification.
     I                 3.
                     fn accepting monies for lega1 fees and costs, and in
     9     depositing them in his trust account, Respondent acted properly
 10        and in accordance with the applicable Rules of professional
 11        Conduct of the State Bar.
t2                     4.
                     Neither the protection of the publi_c, nor of the
i3         courts, nor of the profession, require Respondent's suspension
           from the practice of law.
15                                           RECOMPIENDATION

16                     This Hearing Referree recommends to the Review Department
L7        and the supreme court that Respondent be suspended for three
18        years, such suspension to run concurrently with the interim
19        suspension imposed on Respondent effective                   June 19, 1984.
20                     Tn the exercise of her judicial         discretion,         this Flearing
2t        Referee has declined to follow the guidelines promulgated
22        effective January l-986, for reasons stated at the conclusion of
23        the hearing on April 22, 1987, and primariJ_y because application
24        of the guidelines woul-d result in substantj-al injustice                      in this
25        case which involves a unique set of              c     Cu    tances

          f,JAY   14   1987
                                                                                          40.   lLtu-+/
                                                                       PRINdIPAL REFEREE

The document to which this certifìcate is affixed is a full,
true and correct copy ofthe original on file and ofrecord
in the State Bar Court.

                                  Bar of Califomi4

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