In a tale of broken trusts, more than a dozen clients claim Bradenton attorney Richard Groner mishandled their money prior to his suicide.
Thorns of Deception
In a tale of broken trusts, more than a dozen clients claim Bradenton attorney Richard Groner mishandled their money prior to his suicide.
By David R. Corder
Three days after the March 24 deadline passed for attorney Richard W. Groner to turn over his law firm's financial records to Florida Bar prosecutors, he was found shot to death in the bathtub of his Sarasota apartment.
Clothed - still wearing shirt, tie, pants and shoes - Groner, 59, put a Smith & Wesson revolver into his mouth and pulled the trigger, authorities say. A janitor found his body in the apartment he shared with his 39-year-old girlfriend.
His death passed quietly, at least publicly. There was no story in the local newspapers about Groner's longtime legal career on the Gulf Coast. Nor was there any mention of the Florida Bar investigation into allegations that Groner was accused of stealing several million dollars from clients.
Court records, though, paint a picture of a lawyer whose career began to unravel in the months prior to his death.
Who was Richard Groner?
In May of 2002, Maureen Jamison listened silently on the home's second telephone as her terminally ill husband, Jack, pleaded with Groner to recover about $100,000 the couple had invested in a mortgage that went bad.
"Groner promised my husband he would get all my money back, and he knew my husband was dying," Jamison says. "He even showed up at Jack's memorial."
Nine months later Maureen Jamison answered an anonymous telephone call. A male caller told her Groner had received a $90,000 settlement check in March 2002 - two months before her husband's last telephone call to Groner. And the lawyer had deposited the proceeds into his firm's trust account.
"So the attorney had gotten those funds in March, talked with my husband a week before he died in May and said he would get my money back," Jamison says.
The widow twice called Groner. Last November, he sent her the first of two checks for about two-thirds of her investment. But not all his clients were so fortunate.
At least 15 clients claim he mishandled their legal affairs.
The largest verified claim against Groner - who worked for three decades as a well-respected attorney - was filed by attorneys for Roberta Tankersley-Taylor. She claims Groner embezzled more than $2.9 million. And the personal representative of the Groner estate, Venice attorney Michele Stephan, doesn't dispute the claim.
"The claim includes theft of client funds and intentional misappropriation," Stephan says. "Yes, there is some evidence that the $2.9 million is missing. The estate is doing a thorough investigation into that. We're working with their attorneys to find out what happened."
The attorney for Tankersley-Taylor would neither talk about the claim nor refer questions to his client. "I'm not at liberty to talk about it," says Bradenton lawyer Brenden S. Moriarty of Grimes Goebel Grimes Hawkins Gladfelter & Galvano PA.
As of late October, clients, vendors and family members had filed nearly $16 million in claims against Groner's estate, court records show. Groner's clients sought about $15.2 million of the total claimed. But their efforts against the estate may be pointless. The estate has located only about $92,000 in assets as of early November, Stephan says.
In several instances, Stephan objected to client claims because she says they could not conclusively prove Groner misappropriated funds. "What's happened is several claims were filed by clients that would be their best day in court," she says. "They filed a claim for everything they were hoping to get in a lawsuit. So those claims may or may not have been actually filed."
Stephan, for instance, objected to an $11.5 million claim by Sarasota resident David Rodgers. "In that claim in particular, based on my understanding of the underlying lawsuit, the $11 million is just an extraordinary figure. There may have been a small amount (misappropriated), but not $11 million. That claim was objected to on Aug. 8. They had 30 days to bring an action. They haven't done it, so the claim is barred. The fact they didn't file a lawsuit to recover the amount says a lot about that."
Rodger's representative, Sarasota attorney Marc J. Soss of Becker & Poliakoff PA, did not respond to a request for information about the claim.
Despite working on the estate for seven months, Stephan says she doesn't know what motivated Groner or why his life took such a tragic turn. "Quite honestly, we're still gathering documents and checking into various occurrences," she says. "So at this point I can't say for certain. It's a very complicated matter, and there is a lot to go through. And not having been through everything, I would just be guessing."
Stephan's research into Groner's personal and professional life draws largely on shades of gray to paint the overall picture. One thing is certain: She considers his motives neither sinister nor greedy.
"It's my understanding Mr. Groner was a generous man who cared about his family deeply," she says. "I've spoken with a lot of people, professional, as well as his friends and family. I'm told he was a wonderful man."
Any client that might sue the law firm's malpractice carrier could be facing an uphill battle as well. Lumbermens Mutual Casualty Co. wants to rescind Groner's legal malpractice policy, according to a complaint filed last month in the Tampa division of the U.S. District Court.
The insurance company claims Groner, as the law firm's authorized representative, made material misrepresentations and committed omissions when he renewed the malpractice policy in October 2002.
"Specifically, at the time Groner, as the authorized representative of the law firm, filled out and submitted the subject renewal application to Lumbermens, Groner knew that he had embezzled and/or diverted clients trust funds and/or had committed other illegal acts which could result in a professional liability claim against the firm and had failed to disclose such actions on his application," according to the complaint.
Born July 1, 1943, in Kansas City, Mo., Groner earned a bachelor's degree in engineering in 1969 from the University of Kansas. In 1972, he earned a law degree cum laude from the University of Florida Levin College of Law, where he also served on the college Law Review. Admitted to the Florida Bar the same year he graduated from law school, he practiced in the areas of securities and construction litigation, arbitration and commercial and corporate law.
Five years later, he married Cheryl in West Palm Beach. The couple had two adult children. Their son is a freshman law school student at Florida State University.
Although his wife filed for a divorce in February 2001, Groner waited until the following January to answer the petition. A judge granted the divorce five months later. Groner agreed to pay his ex-wife $4,000 monthly for 80 months as alimony.
Even as late as the early 2000s, Groner established strong credentials as an attorney. From 1992-2001, he served as chairman of the Florida Bar's securities subcommittee. He served as president of the Venice-Englewood Bar Association from 1993-94. From 1982-83, he served as chairman of the 15th Judicial Circuit (Sarasota and Manatee counties) grievance committee.
Until his death, Groner practiced law as the managing partner of Groner Schieb & Williams in a small office in Bradenton's Lakewood Ranch community. Even though their names appeared on the door, Scott Schieb and Steele Williams weren't allowed any involvement in firm's day-to-day financial affairs.
"Steele Williams had actually left the firm," Stephan says. "In all fairness, Steele, as far as the management of the firm, he had no involvement. Scott Schieb and Steele Williams are victims just as much as the creditors. To my knowledge, neither of them knew anything of what was going on."
While Schieb did not respond to requests for comment, Williams talked about how profound an impact Groner's death had on him. "It's been a long year," says Williams, who left Goner's firm in February to work in the Sarasota office of Becker & Poliakoff.
"I wasn't a signatory or an equity partner," Williams says. "Rich saw me as his employee. That's part of the reason I left, because I would never be a partner, an equal partner, with Rich. I was really blessed by God to have been moved from the law firm, because I had no idea what was going on. I don't think anybody did. Rich was in charge of everything."
Williams admired Groner's legal skills. "Rich clearly was very articulate with the pen," he says. "He was very good. In fact, he's one of the best I've seen."
The Florida Bar had Williams produce an inventory of Groner's clients, to advise them about the status of their legal affairs and to recommend a course of action.
"The Florida Bar has really gone out of the way to cover all the bases to the greatest extent possible," Williams says. "I think when these sort of things happen it's a real black eye to the legal profession. So I'm impressed with their seriousness of the matter."
Even though Groner's clients may not collect from the estate, Stephan says those with a proven claim should get some help from the Florida Bar's client compensation fund.
"All of the clients were referred to the fund, actually when the estate was first opened," she says. "Scott Schieb on behalf of the law firm sent letters to all the clients with a letter of explanation and a claim form so that anybody who thought they lost money knew where to go, where to file."
Despite the allegations against Groner, only three of his clients have filed complaints with the Florida Bar, which acts as the investigative arm of the Florida Supreme Court in complaints against attorneys. The Bar has since closed all three cases.
In two of the complaints, clients sought the legal retainers they paid Groner to represent them. Jay and Lucy Montero of Port Charlotte discovered after his death that Groner might have fraudulently used a $5,000 retainer. They expressed disbelief. "We are saddened to learn that such a nice person could do what he did," Lucy Montero wrote on her complaint form.
Another complaint came from New Port Richey businessman R. John Zavodny. He actually owned the Pasco County property mortgaged with the money invested by Maureen and Jack Jamison. Zavodny filed a complaint in October last year because Groner purportedly failed to file a mortgage satisfaction agreement to relinquish the Jamisons' claim on the property. He produced a copy of the Jamisons' settlement check dated March 19, 2002.
"Why would an attorney withhold $90,439,45 from his client?" Zavodny wrote. "What excuse could there be? This is not $900. This is not $9,000. This is ninety thousand dollars."
Groner fought against Zavodny's complaint, hiring Scott Tozian, a Tampa attorney known for his work in defending lawyers accused of wrongdoing. Neither Zavodny nor Tozian responded to requests for comments.
Last Nov. 8, however, Groner acknowledged in a letter to the Bar some of Zavodny's allegations. "Having confessed error in not being prompt, I likewise sincerely believe this does not rise to the lack of an ethical violation," he wrote. "Mr. Zavodny is upset with me, which I accept, and for which I have no excuse."
That apparently did not allay Zavodny's concerns. Partly at his urging in January, the Bar ordered a fiscal accounting of Jamison settlement proceeds and subpoenaed all of the Groner law firm's financial records. Although the reasons are not clear why, Groner still had not produced the financial records at the time of a March 17 letter a Bar attorney sent to Tozian.
"During our meeting, we came to understand that Mr. Groner is involved in some manner of investing funds on behalf of clients and others," states a letter written by Debra J. Davis, a Florida Bar staff counsel. "We specifically requested copies of bank or brokerage statements and relevant documentary support for the period from January 2002 to present for any and all accounts where such investment funds have been deposited. Please also provide a list of all individuals for whom Mr. Groner has held or controlled invested funds during that time and specify any who were clients.
"As documents produced to date reflect, Mr. Groner's trust accounting records and procedures do not substantially comply with the rules regulating the Florida Bar," Davis wrote. "Mr. Groner has also failed to provide a satisfactory response regarding the delays and the general manner in which he handled the trust funds received on behalf of the Jamisons."
Davis then set March 24 as a deadline for production of those documents. "Due to the serious nature of this matter, we will make a decision how best to proceed within days thereafter," she concluded.
On a Thursday morning, three days after the Florida Bar deadline, Richard Groner drove to his office in the Lakewood Ranch community just as any other workday. He worked for a while and then apparently headed straight home to his apartment home in Sarasota.
About 11:30 a.m., a janitor called the Sarasota County sheriff's office to report a death at Groner's apartment. Deputies found Groner's body in a bathtub. A Smith & Wesson revolver in the tub contained one expended round and four unexpended rounds.
By noon, deputies had notified Groner's co-workers. "They were shocked as Groner had been in the office earlier in the morning and had not seemed distressed," according to a sheriff's report. "All office personnel spoke of business pressure being particularly difficult for Groner in the past few months."
The medical examiner's office later determined it was a suicide. No alcohol or drugs were found in his system.
His girlfriend, who has declined comment, "was shocked about the news," the deputies reported. "She advised that she thought he had been getting depressed about the state of his business career, but (he) had not made any suicidal threats."
Groner's Business Acquaintances
Early in her research as the Groner estate's personal representative, Venice attorney Michele Stephan acknowledges she took particular interest in Groner's role as a registered agent and director in about seven corporations, limited partnerships and limited liability corporations. She advised potential claimants about her interests in a letter. Based on resulting research, however, Stephan came to one conclusion.
"Those corporations never got started," she says. "They were filed but never got off the ground. As a registered agent, his role was simply as an attorney. There were other corporations where he was listed as a director, and those corporations were filed but that was it. There was no activity."
State corporation records list Groner as either an agent or director with seven entities that were dissolved in late September. Those entities are Vicksburg Casino LLC, Magnum Investment Funds Inc., Magnum Investment Fund I LP, Klinik St. Georg LLC, Sarasota Realty Holdings II LLC, Magnum Investment Funds Inc., Magnum Investment Management Co. and Redwin Advisors Inc.
In several instances, records also listed as directors Sarasota securities dealers Richard Angelotti, David Rosenberg and his father, Edward Rosenberg.
"Actually he formed all those corporations purely on talk," says David Rosenberg, who met Groner years ago during the time they coached together as assistants on the varsity football team at Sarasota's Cardinal Mooney High School. "They should have never been formed."
One of the purported partnerships, Magnum Investment Fund I, even listed an actual contribution of $10 million. But there never was any money, says Rosenberg, who considers Groner an acquaintance.
"I have no association with him," Rosenberg says. "Magnum was a name I wanted to use. It was (to be) a hedge fund. I discussed that with Rich about forming that, and he went ahead and formed it on his own."
Angelotti, who works with the Rosenbergs in the Sarasota office of Intersecurities Inc., says he met Groner through David Rosenberg. Groner subsequently offered Angelotti cheaper rates than other attorneys on the cost to form corporations.
"Klinik St. Georg and the casino in Tunica was requested by me on behalf of clients," Angelotti says. "(Groner) had no involvement and no investments. He was working solely as an attorney. He had no stake or any investment in those. Those were completely outside activities of clients of ours that did not include him except as an attorney."
The listing of Angelotti as a director in the Magnum companies startled him. "I didn't even know what Magnum was until you called and David (Rosenberg) told me," he says. "We had no connection to (Groner) in the business sense. It's a strange situation. We just don't know what happened."
Calling the situation a confusing puzzle, Edward Rosenberg says he knew nothing about the business filings that listed him as a director.
"I was as shocked as anybody when I heard about his death," the elder Rosenberg says. "But ours was only an attorney-client relationship. His reputation was always great in the community, as far as I know. I thought Richard was an up-and-up gentleman. He treated us with respect and dignity, and we treated him the same way."
Groner estate claims*
Tactical Trenolines Technology Fundvendor$469,946
Rubin Charitable Foundationclient$152,520
Richard Groner II**son $60,000
Cathleen & Joan Norris**clients$49,500
* 10 largest claims; ** objected and barred
Source: Sarasota County Clerk of the Court