A plaintiff lawyer who neglected a medical malpractice suit, blew the statute of limitations and then lied to the client that the case had been favorably settled drew a three-month suspension from the state Supreme Court.

Once Mark Yates discovered that his client’s case had languished, he “chose a cover-up, through a series of lies to the client,” including creation of a false document memorializing a fictitious $600,000 settlement agreement, the Disciplinary Review Board found.

The DRB had recommended a censure for Yates, but the court took a harder line on the deceitful conduct in Matter of Yates, D-141-2011, decided Sept. 26.

In April 2008, Magdi Gadalla met with William Courtney of Flemington to discuss suing Somerset Medical Center Inc. over malpractice alleged to have occurred in December 2007. The firm took the case on a contingent-fee basis. Courtney assigned it to Yates, his associate, but neither lawyer completed the intake form for the office’s case-tracking computer system.

In January 2010, when Yates reviewed the file and found the statute of limitations period had expired the previous month, he panicked and hid the fact from Courtney and the client.

Late that year, Gadalla inquired with Yates about the status of the case. In response, Yates drew up a false settlement agreement, stating that a complaint had been filed on Nov. 13, 2004 — four years before Gadalla even contacted the firm — and that Somerset Medical Center had filed an answer.

The fictitious agreement also stated that the medical center offered $600,000 to settle the matter. 

Yates had Gadalla sign the document and, over the next six weeks, repeatedly assured him that a check had been issued and was en route. 

Finally, the frustrated client paid Yates a visit and Yates came clean. Courtney advised the client to contact a legal malpractice lawyer. In May 2011, the client filed a malpractice action, naming both Courtney and Yates.

In the meantime, Courtney filed a grievance against Yates. 

Yates stipulated with the Office of Attorney Ethics that he violated Rules of Professional Conduct 1.1(a), gross neglect; 1.3, lack of diligence; 1.4(b), failure to communicate with a client; and 8.4(c), conduct involving dishonesty, fraud, deceit or misrepresentation.

The OAE urged a three-month suspension, but in a decision last June 15, the DRB recommended only a censure, even while commenting that the lies and made-up settlement made the situation “much more serious” than neglect of the case and lack of diligence.

DRB chairman Louis Pashman looked for guidance to In re Sunberg, 156 N.J. 396 (1998), where an attorney with no disciplinary history was reprimanded for creating a false arbitration award to mislead his partner and then lying to the OAE about it.

Pashman noted that this was Yates’ “first brush with disciplinary authorities since his admission to the bar, over thirty years ago, and that he readily admitted his misconduct, including having entered into a stipulation with the OAE.” 

“On the other hand, respondent’s deceit in creating an expectation that hundreds of thousands of dollars would come the client’s way cannot be viewed lightly,” Pashman added, concluding that a censure, instead of the less-serious reprimand, was called for.

Two DRB members, Robert Zmirich and Maurice Gallipoli, voted for a three-month suspension.

The Supreme Court heard arguments on Sept. 25, at which Yates appeared pro se. The next day, without opinion, it sided with the OAE and the DRB’s dissenting members, imposing a three-month suspension effective Oct. 26.

The prosecutor, Deputy Ethics Counsel HoeChin Kim, says the discipline is “in keeping with the line of cases that the court has issued … as to fictitious documents provided to a client.”

Yates, reached by phone at Courtney’s law office, declined comment. Courtney did not return a call.

Gadalla’s legal malpractice case is pending. His lawyer, James Dunn of Levinson Axelrod’s Hillsborough office, did not return a call.