People v. Murphy

Murphy, an attorney, and Benware, an (“Appellants”) were each convicted by a jury of five counts of illegally offering and selling security shares in violation of a stock permit issued by the Commissioner of Corporations, a felony. (Corp. Code, § 25540.)

Appellants applied for probation. Their applications were granted. Murphy was sentenced to nine months in the Orange County jail on the five counts; the sentences were ordered to run concurrently; and the sentences were suspended for three years on condition Murphy pay a fine of $5,000 after the judgment became final. Benware was sentenced to six months in the county jail on the five counts; the sentences were ordered to run concurrently; and imposition of the sentences was suspended for three years on condition Benware pay a fine of $2,500 within six months after the judgment becomes final. The court further declared that the offenses were misdemeanors.

California Caduceus Company (“CCC”) was incorporated in California in September 1968 by a group of doctors and the appellants. Their purpose was to enter the medical malpractice insurance field. Murphy performed the legal services necessary for incorporation. Murphy and…