Attorney not out of woods just yet

Las Vegas personal injury attorney Noel Gage was jubilant back in March 2008, when a federal judge dismissed conspiracy and fraud charges against him.

Then his fortunes flip-flopped. An appeals court reinstated charges. On Feb. 8, he is scheduled to be tried a second time.

When that trial ends, no matter what the outcome, he is scheduled to square off against the State Bar of Nevada.

The bar filed a complaint alleging Gage violated the Rules of Professional Conduct, primarily by splitting fees with consultant Howard Awand, his co-defendant in the criminal case.

Nevada lawyers are not supposed to split fees with nonlawyers. The bar alleged Gage was sometimes sharing 39 percent of his fees with Awand, in exchange for Awand referring cases to the personal injury attorney.

The bar complaint said in 11 of Gage's cases he paid Awand $1.3 million out of his attorneys fees and said that is fee splitting. (Ordinary folks might call it kickbacks.)

The federal case focuses on Gage's client, Melodie Simon. The issue is whether he did his best for her, or whether he was more interested in lucrative referrals from Awand, as the prosecution contends. Federal prosecutors allege the Carlos Pachas case was referred to Gage by Awand as a payback for not suing Mark Kabins and John Thalgott on behalf of Simon, who became a paraplegic after surgeries by the two doctors.

U.S. District Judge Justin Quackenbush of Spokane, Wash., previously dismissed 13 criminal counts involving Gage's handling of the Pachas case. Pachas entered a hospital with a kidney stone and left in a vegetative state.

The judge said the matter was one for the state bar and was not a felony: "The payment of a referral fee by Mr. Gage to Mr. Awand or splitting the legal fee in and of themselves may be violations of canons."

The Pachas case was cut out of the federal case, but it's the keystone of the bar complaint.

State bar officials allege that in the Pachas case, when Gage paid Awand $1 million, that was fee splitting with a nonattorney, and that's forbidden. The bar tallied payments from Gage to Awand in 11 personal injury cases, including Simon, Pachas, Gabrielle Knight, Wendy Alfaro, Marie Levinson, Shelba Mawhinney, Janet McNabb, Claire Michels, Joyce Solomon, Annette Trimble and Stefanie Williams.

Gage described the bar complaint as "absolutely false" when it was filed.

Gage attorney Bill Terry filed a two-page answer saying the 16-page complaint wasn't specific enough in saying how the Rules of Professional Conduct were violated. Terry said the checks are "not referral fees and not fee splitting," but he declined to describe what the payments covered.

The bar complaint is tentatively set for March 22 and 23, presuming the federal case is finished.

There has been testimony that Simon's case could have been worth $8 million to $10 million in damages if she had sued Kabins and Thalgott.

But by suing only the anesthesiologist, she received a $2 million settlement.

The criminal case sounds more sinister than the bar complaint. Shortchanging a woman who can never walk again in order to make more money for yourself sounds far worse than fee splitting.

The state bar is often accused of doing little to discipline attorneys, and 17 months passed between the time the judge said this was a state bar matter and when the bar filed a formal complaint against Gage in August 2009.

Gage is one of 21 attorneys with formal complaints pending before the bar, so maybe the bar isn't as lackadaisical as its reputation.

Gage doubtlessly wishes the bar had been more lackadaisical, as he prepares to fight a criminal indictment in February for a second time and a bar complaint in March.

Jane Ann Morrison's column appears Monday, Thursday and Saturday. E-mail her at Jane@reviewjournal.com or call (702) 383-0275. She also blogs at lvrj.com/blogs/morrison.