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Malcolm Wittenberg, the ex-Crosby, Heafey, Roach & May partner who was convicted of insider trading, has sidestepped disbarment. Instead, State Bar Court Judge Patrice McElroy ruled that Wittenberg’s Bar card should be suspended for three years. If the state Supreme Court approves the recommendation, that means that the intellectual property attorney could be plying the legal trade again by November 2004. Although Wittenberg’s crime “significantly harmed the public” and the lawyer “lacked candor” during the Bar hearing, testimony by eight character witnesses weighed heavily in his favor, the judge wrote. “During the vast majority of his career Respondent has been a well respected and competent member of the State Bar,” the judge wrote. “This court does not believe that disbarment, either summary or otherwise, is the appropriate degree of discipline to be imposed in this case,” she later concluded. McElroy’s decision comes as a wave of corporate scandal, including recent allegations that domestic guru Martha Stewart made illegal stock trades, has prompted federal officials to crack down on white-collar crime. Wittenberg, who turns 57 this week, admitted that he bought 2,000 shares of stock in his former client Forte Software Inc. after he learned from company officials that it planned to merge with Sun Microsystems Inc. Instead of prison time, U.S. District Court Judge William Alsup sentenced Wittenberg to three years’ probation, fined him $10,000, and ordered him to speak to attorneys about his crime. Wittenberg, a longtime partner at Crosby, Heafey, was forced to resign his job and lost his membership in the Virginia bar. McElroy’s decision recommends that Wittenberg get a stayed, five-year suspension and that he be put on probation for five years. The conditions of his probation include that Wittenberg actually be suspended three years, submit quarterly probation reports and pass the professional responsibilities exam. Wittenberg’s real suspension will be shorter than three years because he will get credit for the “interim suspension” of his Bar card that was imposed Nov. 30, 2001. The ruling pleased Wittenberg’s attorney Doron Weinberg, who had pushed for an 18-month suspension. “The issue in this case has never been whether Malcolm Wittenberg accepted that something he did was inappropriate,” said the Weinberg & Wilder name partner. Weinberg said he isn’t sure what his client, who is now a patent agent at San Francisco’s Dergosits & Noah, plans to do once he regains his Bar card. “He just wants to be able to continue to practice law in some form,” Weinberg said. Deputy Trial Counsel Donald Steedman, who had argued that Wittenberg be disbarred, said he’s unsure whether he’ll appeal. He noted that McElroy found in his favor on most of the factual issues. That included his argument that Wittenberg’s actions constituted moral turpitude, one of the hotly disputed issues in the case. “The findings were pretty strong in our favor,” Steedman said. During a three-day January hearing, Weinberg argued that Wittenberg’s crime was a one-time lapse in the attorney’s 30-year legal career. On the witness stand, Wittenberg blamed some of his conduct on Percocet, a drug that he was taking to relieve pain he experienced after he had rotator cuff surgery. Steedman has argued that Wittenberg, who eventually admitted that he made $14,000 from the illegal stock deal, tried to conceal his crime after the SEC began to investigate. In her ruling, McElroy noted that the only published opinion similar to Wittenberg’s case was 1989′s Chadwick v. State Bar, 49 Cal.3d 103. In that case, the attorney’s Bar card was only suspended for one year. She came down harder on Wittenberg because, unlike the attorney in Chadwick, Wittenberg’s crime sprouted from his legal practice. Also Wittenberg “failed to demonstrate remorse and recognition of wrongdoing,” she wrote. Both sides have 30 days to decide whether to appeal. If neither side does, the decision goes to the California Supreme Court for approval.

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