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Nikolai Tehin’s arrest Tuesday for mail fraud and money laundering is just the latest legal entanglement for the 56-year-old lawyer accused of the theft and misuse of $2 million in client funds. In the past year, Tehin’s law practice was placed under control of the State Bar, his Pacific Heights home accumulated liens now totaling $11.6 million, and an arbitrator ruled that Tehin owed a former law partner nearly $1.6 million for debts incurred at his previous firm. In May, Tehin filed for Chapter 11 bankruptcy protection in the San Francisco division of federal bankruptcy court. Attorneys involved in the various matters during the past year or more said Tehin demonstrated a dogged determination to keep his law firm extant despite court orders. “At some point you would think that after your misconduct has been discovered, you would at least cease the misconduct,” said Alan Konig, the deputy trial counsel at the State Bar who petitioned the court for control of the firm last year. “I don’t know how to explain that conduct, because it’s baffling to me.” The Bar took the unusual step of asking a San Francisco Superior Court judge to give it control of Tehin’s practice under California Business and Professions Code � 6180. The statute is typically used when an attorney becomes medically incapacitated or has abandoned his practice, Konig said. “I can’t think of the last time we used this particular provision because of discipline as opposed to because of a medical condition or because of abandonment,” he said. The measure allows attorneys for the Bar to take control of a firm’s files, notify clients of the situation, and help clients find new counsel when impending deadlines could threaten their cases. This was a job Tehin was required to do himself after being suspended from practice in August 2002. But according to Konig, many of Tehin’s clients continued to be under the impression that they were being represented by the Tehin + Partners firm. In October 2002, for instance, the First District Court of Appeal issued an order threatening to dismiss the appeal of a Tehin client unless new papers were filed showing a substitution of counsel. The client went pro per before substituting in new counsel in December. In a biography he placed on the Tehin + Partners Web site, Tehin claimed to sit on the board of directors of the San Francisco Trial Lawyers Association. But according to Juliette Bleecker, the SFTLA’s executive director, records dating back to the 1970s show no indication of Tehin ever having sat on the board. In fact, says Bleecker, Tehin hasn’t been a member of the group since 1994, a prerequisite for board membership. “I would say it was false advertising,” said Bleecker, adding that it was “very upsetting.” The State Bar placed Tehin and his wife and law partner Pamela Stevens on involuntary inactive status last August based on evidence that in at least seven different matters Tehin had delayed or entirely failed to pay clients their settlement funds. According to U.S. Attorney Kevin Ryan’s office, which is bringing criminal charges based on some of the incidents, Tehin operated a Ponzi-like scheme in which he used more than $2 million in settlement funds to pay for expenses on his house and his 73-foot yacht. Harold Rosenthal, Tehin’s attorney, described his client as a talented lawyer, and said the Bar suspension and the criminal investigation were two separate matters. “The Bar issue is a question of his fitness to practice law and the protection of his clients. And the federal criminal law issue is one of mental state and culpability,” said Rosenthal, of Rosenthal & Gibbons. “Now the question is going to be whether or not he was just somebody who was so careless and out of his depth dealing with the finances of a practice of which there was a lot of money going in and out, or whether or not he was someone who intentionally stole money from his clients,” Rosenthal said. For the past several years, Tehin has also been fighting in court with James Bostwick, his former partner at an earlier law firm called Bostwick & Tehin. “The partnership broke up in 1996, long before Nick got into trouble,” said Armon Cooper, who is representing Bostwick. “Jim Bostwick wasn’t happy practicing law with Nick anymore. He didn’t think Nick was carrying his load.” In July 2002, Bostwick won a $1.58 million arbitration award for various claims related to the firm’s dissolution, including lease termination fees, bank loans and receivables from ongoing matters. But collecting on the judgment could take some time. The award is one of the many liens against Tehin’s $8.5 million Pacific Heights home that are now stayed as a result of the bankruptcy filing.

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