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Iowa Supreme Court Attorney Disciplinary Board v. Wintroub

Iowa Supreme Court

745 N.W.2d 469 (2008)

Facts

After many years of friendship, Ronald Bergman retained attorney Edward Wintroub (defendant) for legal representation. During the representation, Wintroub sold stock in Wintroub’s corporation to Bergman for $150,000 without advising Bergman to seek review by independent counsel. Wintroub also failed to fully disclose the corporation’s finances and failed to explain to Wintroub that minority interests in closely held corporations are typically illiquid and have no control over management. During the same period, Berman made a $275,000 unsecured loan to Wintroub at 0 percent interest after Wintroub made a thorough disclosure of his own desperate financial situation. Wintroub did not advise Bergman to seek independent counsel to review the arrangement. A year later, Bergman started asking Wintroub for repayment, but no repayment was forthcoming. The relationship between Bergman and Wintroub deteriorated, and Bergman eventually sued Wintroub. Wintroub then declared bankruptcy and went before the Iowa Supreme Court, which reviewed the Iowa Supreme Court Attorney Discipline Board’s sanctions recommendations.

Rule of Law

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Issue

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Holding and Reasoning (Appel, J.)

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