- Court
- New York Supreme Court, Appellate Division, Third Department
- Case
- Matter of DeLorenzo
- Date
- May 28, 2026
- Slip Op. No.
- 2026 NY Slip Op 03354
Background
Respondent Paul Edward DeLorenzo was admitted to practice in New York in 1993 and was previously associated with the law firm of DeLorenzo, Grasso & Dalmata, LLP (DGD) in Schenectady County. The Attorney Grievance Committee (AGC) investigated DeLorenzo’s unauthorized use of funds maintained in DGD’s escrow accounts. While DeLorenzo attempted to resign from the bar during the investigation, AGC cross-moved for his interim suspension. In March 2023, the Third Department suspended DeLorenzo on an interim basis based on his admissions to professional misconduct regarding the escrow account and his failure to address AGC’s allegations of misappropriation. DeLorenzo subsequently moved for reinstatement. AGC opposed the motion.
Holding
The Appellate Division denied DeLorenzo’s motion for reinstatement. The Court applied the reinstatement standard requiring clear and convincing evidence that the suspended attorney has complied with the order of suspension and the Court’s rules, possesses the requisite character and fitness to practice law, and that reinstatement would be in the public interest. The Court found that DeLorenzo failed to satisfy these requirements, particularly with respect to character and fitness and the public interest prong. The serious nature of the misconduct—unauthorized use of law firm escrow funds—and the circumstances surrounding DeLorenzo’s attempt to resign during the investigation weighed heavily against reinstatement. AGC’s opposition highlighted ongoing concerns about DeLorenzo’s fitness to handle client funds and the public’s trust in the profession.
Takeaways
Reinstatement from suspension is not automatic, even after a period of compliance with the suspension order. The attorney must affirmatively demonstrate character, fitness, and that reinstatement serves the public interest. Misappropriation of escrow funds is one of the most serious forms of professional misconduct, and attorneys suspended for such conduct face a particularly high bar when seeking reinstatement. An attorney’s attempt to resign from the bar during an investigation, rather than cooperating fully, may be viewed as an aggravating factor that undermines the showing of character and fitness required for reinstatement.
Why It Matters
This decision is important for the legal profession because it demonstrates that the Third Department will carefully scrutinize reinstatement applications from attorneys suspended for escrow account violations. Unlike the routine reinstatements granted in Judiciary Law section 468-a cases involving registration defaults, reinstatement following a misconduct-based suspension requires a more searching inquiry into the attorney’s fitness to resume practice. Attorneys who have been suspended should understand that simply waiting out the suspension period is insufficient; they must affirmatively demonstrate rehabilitation and fitness, and they should be prepared for opposition from AGC, particularly in cases involving financial misconduct.