Complete Restitution as a Precondition to Reinstatement and a Two-Year Benchmark for Law‑Firm Fee Diversion

Office of Lawyer Regulation v. Matthew V. Burkert, 2025 WI 44 (Wisconsin Supreme Court, Sept. 12, 2025)

Introduction

This attorney disciplinary decision addresses a sustained scheme by Attorney Matthew V. Burkert to divert law-firm fees to himself through a separate entity he created while still a member of his firm. The Supreme Court of Wisconsin, reviewing a referee’s report under SCR 22.17(2), imposed a two-year suspension, restitution, and costs. Crucially, the court also required that full restitution to the former firm for all diverted monies—not merely the stipulated subset—be completed as a condition to filing any petition for reinstatement. The opinion thus clarifies two important points in Wisconsin lawyer discipline:

Where a lawyer engages in a pattern of law-firm fee diversion with inadequate acceptance of responsibility and incomplete restitution, a two-year suspension will be imposed at the higher end of the established range for such misconduct.
When restitution issues remain unresolved, the court can, and here does, require complete restitution to the firm as a precondition to filing any reinstatement petition, avoiding remand and ensuring victim compensation precedes return to practice.

The parties are the Office of Lawyer Regulation (OLR), as complainant, and Attorney Burkert, as respondent. After nearly two years of litigation, Burkert entered a no-contest plea to two counts based on numerous instances of dishonesty and fiduciary breach related to his former law firm, Sorrentino Burkert Risch LLC (SBR). The referee recommended an 18-month suspension and limited restitution; the Supreme Court increased the suspension to two years and tightened the restitution obligations.

Summary of the Opinion

The Wisconsin Supreme Court adopted the factual allegations in the OLR’s amended complaint—accepted by Burkert via a comprehensive stipulation and no-contest plea—and concluded that he violated:

SCR 20:8.4(c), by engaging in dishonesty, deceit, or misrepresentation, and
SCR 20:8.4(f), by violating the fiduciary and honesty duties to one’s law firm recognized in In re Disciplinary Proceedings Against Shea, 190 Wis. 2d 560, 527 N.W.2d 314 (1995).

Although the referee recommended 18 months and the OLR ultimately joined that recommendation, the court imposed a two-year suspension, citing:

A sustained, planned pattern of deceit and fee diversion using an outside LLC created with firm resources and concealed from the firm.
Repeated minimization and “inadvertence” claims, a delayed no-contest plea, and incomplete restitution reflecting limited acceptance of responsibility.

The court ordered:

Restitution of $24,358.50 to SBR for specified matters within 60 days.
As a condition of filing any reinstatement petition, proof that full restitution has been made to SBR for all diverted monies (not just the stipulated amount), referencing SCR 22.29(4)(m). The court emphasized it “will accept no excuses.”
Costs of $4,875.21 to the OLR, with restitution to be paid before costs.
Compliance with SCR 22.26 and reinstatement conditions under SCR 22.29(4)(c).

Justice Rebecca Grassl Bradley did not participate.

Factual Background

Admitted in 2004 with no prior discipline, Attorney Burkert practiced in southeastern Wisconsin. He became a member of SBR, then—while still at SBR—created “MZR Advisors, LLC” (MZR) using SBR personnel and funds, concealed that entity on the firm’s malpractice insurance “Outside Interest Supplement,” and directed staff in a way that hid his control of MZR. Upon leaving SBR on July 31, 2020, SBR discovered MZR’s involvement and multiple billing irregularities across numerous client matters.

Illustrative matters include:

C.W.: SBR billed $7,276.50; while still at SBR, Burkert told C.W. a forthcoming invoice “may come through an affiliate firm of mine, MZR Advisors LLC,” then had SBR write off additional unbilled time. C.W. paid MZR rather than SBR; after SBR challenged the payment, Burkert refunded and directed payment to SBR.
E.N.: Work performed using SBR resources; Burkert billed and collected through MZR. He later claimed to OLR that use of SBR systems was “unintentional.”
Selzer-Ornst Construction: SBR did nearly $19,148.50 in work; while still at SBR, Burkert invoiced Selzer-Ornst $20,000 through MZR for the same services and kept the funds, leaving SBR unpaid. He appears to have retained those funds for more than four years.
Cox Plumbing: SBR’s work exceeded $42,000; Cox said it bartered at least $20,000 in services to Burkert personally; SBR remained unpaid.
Cherney Brothers and M.B.: SBR performed $2,390 of legal work; while still at SBR, Burkert directed SBR to write off the bill; Cherney paid MZR $17,350 for what Burkert characterized as a mix of “investment banking services and legal work”; SBR was not reimbursed.
Cottage LLC: SBR performed $9,198 in legal services; Burkert directed a write-off linked to his personal acquisition of a 10% equity interest; after pushback, he produced a later letter attempting to recast the consideration for that equity; SBR remained unpaid.
Jendrach, Dobogai, Lindseth, Inc. (JDL): JDL confirmed it paid $968.50 for two SBR invoices directly to Burkert personally.

The amended complaint alleged two counts that encompass all of these episodes. Although only two rules were charged, the court observed the misconduct spanned at least eight matters and could be viewed as the equivalent of many counts.

Analysis

Precedents Cited and Their Influence

In re Disciplinary Proceedings Against Shea, 190 Wis. 2d 560, 527 N.W.2d 314 (1995). The court reaffirmed that a lawyer owes fiduciary and honesty duties to the lawyer’s firm. Violation of this court-recognized duty is enforceable under SCR 20:8.4(f) as a “supreme court decision regulating the conduct of lawyers.” Shea furnishes the doctrinal basis for treating intra-firm dishonesty—such as undisclosed fee diversion—as professional misconduct.
Sanction-range cases for law-firm fee diversion:
- Hotvedt, 2016 WI 93, 372 Wis. 2d 68, 888 N.W.2d 393: 18-month suspension (stipulated) where the lawyer agreed to full restitution to the former firm.
- Brown, 2005 WI 49, 280 Wis. 2d 44, 695 N.W.2d 295: 18-month suspension (stipulated), with self-reporting and full restitution plus damages via dissolution agreement.
- Koenig, 2015 WI 16, 361 Wis. 2d 16, 859 N.W.2d 105: two-year suspension (stipulated) and restitution to the former firm.
- Cotter, 171 Wis. 2d 373, 491 N.W.2d 475 (1992): two-year suspension where the respondent accepted “little, if any” responsibility.
These cases establish an 18–24 month range for law-firm fee diversion, with the high end triggered by aggravated features such as minimal remorse and incomplete restitution.
Standards of review and sanction methodology:
- Inglimo, 2007 WI 126, 305 Wis. 2d 71, 740 N.W.2d 125: factual findings reviewed for clear error; legal conclusions de novo.
- Widule, 2003 WI 34, 261 Wis. 2d 45, 660 N.W.2d 686: the court determines discipline independently, though it benefits from the referee’s recommendation.
- Scanlan, 2006 WI 38, 290 Wis. 2d 30, 712 N.W.2d 877: sanction factors include seriousness and extent of misconduct; protection of the public and courts; impressing upon the lawyer the seriousness of misconduct; and general deterrence.
- Carroll, 2001 WI 130, 248 Wis. 2d 662, 636 N.W.2d 718: commonly cited in referee analyses for sanction principles.
- Malloy, 2025 WI 39, __ Wis. 2d __, 24 N.W.3d 552: reaffirming case-by-case sanctioning within precedent-informed ranges.
Procedural rules:
- SCR 22.17(2): when no appeal is filed from the referee’s report, the Supreme Court independently reviews and determines discipline.
- SCR 22.29(4)(m): reinstatement petitions generally require proof that restitution has been made or arrangements exist; here, the court sharpened and front-loaded that obligation by making complete restitution a prerequisite to filing.
- SCR 22.26: duties of suspended attorneys (notice, wind-down, etc.).

The court’s reliance on Hotvedt, Brown, Koenig, and Cotter is key. It mapped Burkert’s conduct onto a known sanction range and located his case at the aggravated end because, unlike Hotvedt and Brown, he did not reach full restitution, and like Cotter, he showed little acceptance of responsibility. The opinion also underscores that stipulations—by the parties or OLR—do not bind the court on sanction, consistent with Widule.

Legal Reasoning

The court applied the Scanlan sanction factors against a voluminous factual backdrop:

Seriousness, nature, extent: Burkert’s conduct was not a discrete lapse; it reflected planning and persistence. He formed MZR using SBR’s resources; concealed it on a malpractice disclosure; directed staff to obscure its filing; repeatedly invoiced through MZR (or himself) for SBR matters; wrote off SBR receivables to pave the way for his own collections; and in one case appears to have retained a $20,000 client payment for more than four years. The court highlighted that he “had a plan” and “intentionally used that entity on multiple occasions to defraud both his clients and his law firm.”
Protection of the public and the legal system: The pattern and duration, along with attempted minimization and delayed, partial restitution, suggested a risk of recurrence. A two-year suspension was necessary to protect the public and the courts and to preserve confidence in the profession’s self-regulation.
Impressing upon the lawyer the seriousness: Burkert litigated for nearly two years, then entered a no-contest plea as the hearing neared; his responses often claimed lack of recollection or “inadvertence.” Even after stipulating facts, he only agreed to partial restitution. These features showed insufficient acceptance of responsibility warranting a stronger sanction.
Deterrence: The court intended to deter similar intra-firm dishonesty. Given that Hotvedt and Brown received 18 months after full restitution and genuine acceptance of responsibility, elevating Burkert to two years signals that partial or delayed repentance will not reduce sanction exposure in fee diversion matters.

On restitution, the court took a pragmatic approach. Rather than remanding to quantify all unpaid amounts, it ordered the stipulated $24,358.50 and then leveraged SCR 22.29(4)(m) to require full restitution to SBR for all diverted sums as an explicit precondition to filing any reinstatement petition. The court emphasized that this must be completed before filing and that it “will accept no excuses.” It also prioritized restitution over costs by ordering restitution to be paid before OLR costs.

Impact and Prospective Significance

Sanction calibration in law-firm fee diversion cases: This opinion clarifies that the “ordinary” range remains 18 months to two years, but where the attorney fails to make full restitution and shows limited remorse or accountability, the two-year mark is the likely outcome. Parties should not assume a negotiated 18-month recommendation will be adopted.
Restitution architecture in discipline: The court demonstrated a flexible but firm approach: it can avoid remands and unresolved accounting disputes by conditioning the very filing of a reinstatement petition upon full restitution. This both expedites discipline and ensures victims are made whole before any return to practice.
Stipulations are not binding on sanction: Even when OLR revises its recommendation downward to reflect a no-contest plea and partial restitution, the court remains free to impose higher sanctions consistent with precedent and the record.
Fiduciary duty to the law firm, enforced through SCR 20:8.4(f): The reaffirmation of Shea keeps intra-firm honesty and fiduciary loyalty squarely within the disciplinary framework. Lawyers who divert firm opportunities or revenues face professional discipline, not merely private civil liability.
Outside business entities and disclosure: The case underscores the need to disclose outside entities on firm insurance disclosures and to avoid using firm resources for personal entities. Failure to disclose can magnify the gravity of related fee diversion misconduct.
Client-facing implications: Invoicing through a personal affiliate while at a firm risks confusing clients and creating double-payment exposure. The court’s discussion of C.W. and Selzer-Ornst illustrates how clients can be caught in the middle, and how firms may choose not to pursue additional payments to avoid double billing harm.

Complex Concepts Simplified

No-contest plea in discipline: The lawyer does not contest the charges; the court can accept the complaint’s facts as the basis for discipline without an admission of every allegation. A no-contest plea can facilitate resolution, but it does not guarantee leniency.
SCR 20:8.4(c) (dishonesty): Prohibits conduct involving dishonesty, fraud, deceit, or misrepresentation. Here, issuing invoices through a personal LLC for firm work, hiding an outside entity, and directing write-offs that enabled personal collections all fell within this prohibition.
SCR 20:8.4(f) and Shea: Authorizes discipline for violating a Supreme Court decision regulating lawyers. Shea recognizes a lawyer’s fiduciary and honesty duties to the lawyer’s firm; violating those duties is professional misconduct.
Fee diversion vs. conversion: “Diversion” describes routing payments owed to the firm to oneself or an outside entity; “conversion” captures the wrongful exercise of dominion over property (here, firm receivables) inconsistent with the rightful owner’s interests. The court used both concepts to describe Burkert’s conduct.
Restitution vs. costs: Restitution compensates those harmed (here, the former firm). Costs reimburse the OLR for prosecuting the discipline case. This opinion prioritizes restitution before costs.
Reinstatement conditions (SCR 22.29): A suspended lawyer seeking reinstatement must show, among other things, that restitution has been made. The court here strengthened that requirement by making full restitution a prerequisite to filing any reinstatement petition at all.
SCR 22.17(2) review: When no party appeals the referee’s report, the Supreme Court still independently reviews and imposes discipline; it may adopt, reject, or modify the referee’s findings, conclusions, and recommended sanction.

Key Factual Markers Relied Upon by the Court

Creation of MZR using SBR’s resources and concealment of MZR on malpractice insurance disclosures.
Use of MZR to invoice SBR clients for SBR work while still at the firm.
Directed write-offs and “holds” on SBR billing that facilitated personal collections.
Retention of client payments for extended periods without remitting to SBR (e.g., Selzer-Ornst $20,000).
Repeated claims of “inadvertence,” delayed plea, and partial restitution only after protracted litigation.
Mitigation: no prior discipline; some stipulated restitution. Nonetheless, aggravating factors predominated.

Practical Guidance for Lawyers and Firms

Disclose all outside entities on firm and insurance forms; any “affiliate” with fiduciary control must be listed.
Do not use firm staff, systems, or funds to create or operate personal entities without authorization and fair allocation.
Never invoice firm clients through a personal entity for work done at the firm; routing firm receivables to oneself is sanctionable misconduct.
If a dispute arises over receivables, proactively reach a restitution agreement and self-report if necessary—full restitution and genuine acceptance of responsibility materially affect sanction outcomes.
Maintain clear policies regarding bartering, equity compensation, and write-offs; ensure firm consent and documentation; do not unilaterally trade firm receivables for personal benefits.

Conclusion

Office of Lawyer Regulation v. Burkert reinforces and refines Wisconsin’s disciplinary treatment of law-firm fee diversion. Within the established 18–24 month range, the court set a clear marker: when a lawyer orchestrates sustained fee diversion, fails to fully accept responsibility, and does not make complete restitution, a two-year suspension is appropriate notwithstanding a referee’s lesser recommendation or OLR’s modified request. Procedurally, the opinion confirms that the court will use reinstatement tools to ensure complete restitution—requiring it to be finished before any reinstatement petition can even be filed—and will prioritize restitution over costs. Substantively, the court again grounds intra-firm honesty and loyalty in Shea and enforces those duties through SCR 20:8.4(f), while applying SCR 20:8.4(c) to deliberate schemes of deceit.

The takeaways are direct: lawyers must be transparent with their firms about outside interests, avoid any diversion of firm revenue, and immediately remediate harm if lapses occur. For the bar at large, the decision underscores that stipulations do not constrain the court’s sanction authority and that full restitution and genuine contrition are pivotal in determining whether discipline trends toward the lower or higher end of the range. As a precedential signal, Burkert will guide future fee-diversion cases toward stricter sanctions where remorse and restitution are wanting, and it ensures that victims are made whole before a suspended lawyer returns to practice.

Complete Restitution as a Precondition to Reinstatement and a Two-Year Benchmark for Law‑Firm Fee Diversion: Office of Lawyer Regulation v. Burkert (2025 WI 44)