R. Todd Cavazos and his girlfriend, who hired Houston personal-injury lawyer Steven Alexander Bearman in 2005 following a car accident in Houston, knew something was really wrong when they found out Bearman had settled their claim with an insurance company without telling them.
“He had already settled out,” says Cavazos, who lives in Fayetteville. “He kept on saying, ‘It’s coming to a close; we are coming to an end with the settlement.”
Cavazos alleges Bearman never paid him or his girlfriend thousands of dollars in settlement funds they should have received, and Bearman also failed to pay his girlfriend’s medical bills for treatment for a back injury that resulted from the accident.
Cavazos and his girlfriend aren’t the only former clients of Bearman who allege they didn’t receive settlement money from Bearman or that he failed to pay their medical bills. Bearman, whose Texas law license has been suspended since March 30, 2007, awaits sentencing on a felony charge of misapplication of fiduciary property over $200,000. Bearman, who pleaded guilty to the charge in May 2007, faces punishment ranging from five to 99 years or life in prison, but he is eligible for probation.
Some of Bearman’s former clients attended a sentencing hearing on Aug. 21 in 183rd District Judge Vanessa Velasquez’s Houston court. Bearman’s attorney, Houston solo Tommy LaFon, asked the judge to continue the hearing until Aug. 28, because he needed more time to prepare to respond to an Amended Punishment Memorandum filed on Aug. 20 by the Harris County District Attorney’s Office.
Bearman was indicted in December 2006. The indictment alleges that from around July 13, 2004, through Sept. 16, 2005, he “intentionally, knowingly and recklessly, by failing to properly safekeep money and distribute the money, did misappropriate property” from 16 individuals.
In the Amended Punishment Memorandum, Assistant Harris County District Attorney Lester Blizzard alleges the DA’s office received complaints from dozens of Bearman’s clients who claim Bearman settled their personal-injury suits without their permission and then failed to distribute settlement money to them or failed to pay their medical bills.
According to an exhibit filed with the memorandum, the DA’s office alleges Bearman failed to pay settlement funds totaling nearly $1.6 million to clients who had hired him to handle their personal-injury claims, and he failed to pay about $800,000 in medical bills.
Blizzard, a veteran prosecutor who is major fraud division chief for the DA’s office, says it’s the most egregious case of misapplication of fiduciary duty on the part of a lawyer he has ever handled.
The memorandum signed by Blizzard also alleges that after Bearman’s license to practice law was suspended in March 2007 — the Commission for Lawyer Discipline obtained the interim suspension — he started working at the Roth Firm in Houston. While there Bearman gained access to lawyer Tassi Roth’s trust account and used its funds without authorization to provide restitution to former clients, to cover child support payments and to pay an attorney representing him in criminal court, Blizzard alleges.
A 1994 graduate of the University of Houston Law Center, Bearman has been in custody in the Harris County jail since his bond was revoked in June. According to a motion to revoke filed in May, the DA’s office alleged Bearman continued to “engage in criminal activity” by continuing to meet with clients while employed at The Roth Firm and by failing to pay settlement funds to those clients, or by failing to use settlement proceeds to pay medical providers.
LaFon, Bearman’s attorney since June 18, says he cannot comment before Bearman’s sentencing.
Roth did not return two telephone calls seeking comment before presstime on Aug. 21. However, in an affidavit he signed on June 4 that is an exhibit to the Amended Punishment Memorandum, Roth alleges Bearman may have taken as much as $200,000 from accounts at his firm.
Roth alleges in the affidavit that after Bearman’s license was suspended in 2007, he agreed to take over Bearman’s caseload and hired Bearman as a $7,000-a-month paralegal/marketing director to “bring him up to speed on the folks and the issues involved.” Roth alleges he learned in late April that some clients weren’t getting paid, and after a review of his accounts, “I was shocked to learn that Steve had apparently gotten access to my operating account and paid out over $108,000 in restitution by cashier’s check from my operating account” to clients whose complaints are included in the indictment.
“I did not authorize those payments,” Roth alleges in the affidavit. “It also appeared that he was using my operating funds to make child support payments and to pay his own attorney.”
In the affidavit, Roth says the “full extent of the damage is not known” but “it seems clear that close to $200,000 clearly traceable to Steve was moved . . . without my permission.”
Bearman’s former attorney, Paul Nugent, a partner in Foreman DeGeurin Nugent in Houston, who withdrew from representing Bearman in June, did not return two telephone calls seeking comment. However, in a motion he filed in June seeking permission to withdraw, Nugent alleged he had “recently been made aware of developments which necessitate the severance of the attorney client relationship.”
Blizzard alleges in the memorandum, “The defendant has caused great harm. . . . His clients are left without funds to support themselves, treat their medical conditions or care for their families. They have been repeatedly lied to time and time again.”
Blizzard alleges in the Aug. 20 Amended Punishment Memorandum that Bearman committed an offense that “reaches at the heart of the justice system” and causes great harm to his clients and medical providers.
“He repeatedly lied to his victim clients about the settlements in their personal injury cases and lived a high lifestyle while they continued to suffer. He has taken advantage of this court by continuing criminal conduct while he was on bond,” Blizzard alleges.
The criminal charge hasn’t been Bearman’s only worry, however. The Commission for Lawyer Discipline has also taken court action against him.
In February 2007, the commission filed a Petition for Immediate Interim Suspension seeking to suspend Bearman during the pendency of disciplinary proceedings. The commission sought the suspension under Rule 14.01 of the Texas Rules of Disciplinary Procedure, which says the chief disciplinary counsel shall seek an immediate interim suspension if the counsel reasonably believes the attorney “poses a substantial threat of irreparable harm to clients or prospective clients.”
The commission alleges in the petition, filed in the 164th District Court in Harris County, that it is investigating grievances filed by eight individuals who had hired Bearman to handle their personal-injury matters in 2003, 2004 or 2005.
In a Feb. 22, 2007, original answer, Bearman opposed the suspension on several grounds, including the fact that the temporary order would prevent him from doing business and thereby prevent him from being able to make payments to clients, former clients and medical providers.
Bearman was represented by Robert Bennett and Renee Moeller-Taylor of the Bennett Law Firm in Houston, but their motion to withdraw is pending, according to court records in Commission for Lawyer Discipline v. Steven A. Bearman. Moeller-Taylor was not in the office on Aug. 21, and Bennett did not return a telephone call seeking comment.
In March 2007, 164th District Judge Martha Hill Jamison of Houston signed an order granting the commission’s petition for an immediate interim suspension of Bearman’s license to practice law in Texas. The suspension was effective March 30, 2007, and will remain in effect pending a final disposition of disciplinary proceedings against Bearman.
In the petition seeking the suspension, the commission alleges eight of Bearman’s clients filed grievances alleging professional misconduct. The petition alleges Bearman violated several Texas Disciplinary Rules of Professional Conduct, including 1.03(a)(b), failure to communicate; 1.02(a)(1)(2), failure to abide by client’s decision on settlement; 1.04(d), failure to provide written accounting and distribution analysis; 1.14(a)(b)(c), failure to properly safeguard and/or distribute funds; 1.15(d), failure to surrender files; 8.04(a(2), commission of a serious crime; 8.04(a)(3), engaging in dishonesty, fraud, deceit or misrepresentation; and 8.04(a)(8), failure to timely respond to grievance.
The commission alleges that Bearman has a “pattern of misconduct and blatant disregard for the duties and obligations he owes to his clients and to the legal profession.”
“In this case, Respondent’s conduct is unbecoming of a lawyer and will unquestionably place any client or prospective clients at risk or harm either for having their case neglected or for having their settlement misappropriated. Accordingly, Respondent must be suspended from the practice of law pending a final disposition of the disciplinary proceedings currently pending against him,” the commission alleges in the petition.
Maureen Ray, special administrative counsel to the chief disciplinary counsel, says Bearman could lose his license permanently as a result of a criminal conviction. She says that once Bearman’s conviction in criminal court is final, the commission can ask the Board of Disciplinary Appeals to disbar him, if Velasquez does not sentence him to deferred adjudication or probation.
Many of Bearman’s former clients who brought their complaints to the DA’s office want Velasquez to give Bearman the maximum sentence on the felony — which would be life in prison — according to Crime Loss Forms attached as exhibits to the Amended Punishment Memorandum.
Blizzard, who came into Velasquez’s courtroom with 10 boxes of documents obtained from Bearman’s practice, says he’s disappointed the sentencing hearing was delayed for a week. However, he says, “It’s an important case. The judge has to be very careful.”