NY Lawyers Arrange "Justice" for Chicago $250 Million Ponzi Scam

Committee on Public Integrity
Tel: 202-374-3680
Fax: 202-207-9548
email: CommitteeOnPublicIntegrity@gmail.com
Web: www.CommitteeOnPublicIntegrity.com

READ THE PRESS RELEASE, then CLICK HERE TO SEE THE OVERVIEW OF

The $250 Million Ponzi Scheme, the New York lawyers who worked 'magic', and the participant that might become a U.S. Senator

PRESS RELEASE
For Immediate Release

U.S. Senate Candidate Involved in $250 Million Ponzi Scheme

The Committee on Public Integrity, in a joint investigation withIntegrity in the Courts Finds that Alexi Giannoulias, U. S. Senate Candidate in Illinois, Failed to Reveal That His Family’s Broadway Bank Paid Kick Backs in Mortgage Fraud Deals with Financial Ponzi Scheme Operators

The Senate Candidate Also Failed to Reveal that the Giannoulias Family Bank Paid a Settlement Valued at $6 Million to End the Lawsuit by U.S. Department of Justice and Securities and Exchange Commission

As part of its continuing full disclosure by federal candidates program, The Committee on Public Integrity and Integrity in the Courts has discovered that Alexi Giannoulias, Democratic candidate for US Senate from Illinois has misrepresented the record of Broadway Bank, the Chicago bank owned by his family. The actual facts as revealed in litigation brought by the US Justice Department and the Securities and Exchange Commission reveal that Broadway Bank engaged in fraudulent loans with Wextrust, a finance company. Broadway Bank was subsequently seized by the SEC, and the chief officers of Wextrust are in jail.

During the last debate with Congressman Mark Kirk, Alexi Giannoulias was asked to comment on the activities of Broadway Bank, the main business asset of his family. Giannoulias said, “And let’s be clear, no one has ever suggested that the bank has ever done anything illegal, illicit, or improper. Never." He continued, "I will always tell you the truth. And that's what we need now more than ever. People are sick and tired of Washington, D.C. politics as usual." Information is now coming to light that shows that Broadway Bank engaged in kick-backs and other lucrative deals with Ponzi scheme operators, who are now in jail.

Beginning in 2006, when Alexi Giannoulias was a loan officer at Broadway, the bank entered into a series of commercial loans in joint ventures with Wextrust Capital, a Chicago based lending company. Wextrust provided so-called “hard money” loans to developers, who could not find standard financing from banks. Hard money loans are provided at very high interest rates, up to 18-20% when the costs of so-called origination and finders fees are added.

Under the deals between Wextrust and Broadway Bank, evidence has been discovered showing that borrowers paid the bank high interest charges (12-14%), and then Broadway Bank kicked back 2-3% of the payments received to Broadway as part of a so-called loan servicing contract. Also, it’s been established that throughout its years of operation, Wextrust was insolvent, making all of its mortgage deals void and fraudulent. That meant that all the joint mortgage deals marketed byBroadway Bank and Wextrust were illegal, illicit and improper.

Wextrust was seized and placed in control of a federal receiver by the US Securities and Exchange Commission in August 2008 for operating a $250 MM Ponzi scheme. The SEC found that Wextrust operated a massive Ponzi-type scheme from 2004 that raised approximately $255 million from approximately 1,200 investors in the US and other countries. The Receiver confirmed that Wextrust diverted, co-mingled and misappropriated those funds, in a series of unauthorized transactions. The US Department of Justice filed criminal complaints against Wextrust's principal officers who were immediately arrested, and who remain in custody. The company president, Steven Byers, entered a guilty plea in April 2010, and is awaiting sentencing.

Broadway Bank was a partner with Wextrust in the series of fraudulent loans. Alexi Giannoulias was a loan officer when Wextrust began its dealings with Broadway Bank. Evidence has been uncovered by the SEC showing that Alexi’s brother, Demetri, personally handled these mortgage loans with Wextrust.

In April 2010, just before being seized by the Illinois and US banking authorities, Broadway Bankagreed to forgo $5 million in claims and to pay up to $800,000 in cash to settle litigation with the federal Receiver of Wextrust. This Settlement clearly reflected a payment by Broadway Bank to settle claims by the Securities and Exchange Commission and avoid liability for illegal actions in connection with its financing transactions with Wextrust.

For additional information please contact: John T. Whitely at 202-374-3680

About The Committee on Public Integrity
The Committee On Public Integrity reviews both past and present cases to provide an independent assessment and analysis of the facts. With respect to past cases, the committee will hear from persons who maintain that they have been treated unfairly and unjustly. As part of its efforts, the committee is actively seeking documentation and analysis of various issues. Committee members include individuals who through their personal and professional lives have established a reputation of responsibility and fairness.

For Detailed Information to Referenced Documentation, See Below:

NY Lawyers Arrange "Justice" for Chicago Ponzi Scheme

The $250 Million Ponzi Scheme "Settlement"

Transcript of April 2010 Guilty Plea

August 2010 - 7th Interim Report of Receiver

Response to Objections to the Receiver's Report

Civil Lawsuit: SEC v Byer, et al.

Long Star State Joins New York's "Judges For Sale" Program

Couple in custody battle accused of paying judge for favorable rulings
The Dallas Morning News by - VALERIE WIGGLESWORTH, ED HOUSEWRIGHT and MATTHEW HAAG - October 23, 2010

A University Park couple was embroiled in a costly child-custody battle at the time prosecutors say they paid $150,000 in bribes to the political opponent of the judge hearing their case. David and Stacy Cary were in state district court in Collin County, fighting for custody of David Cary's twin daughters from a previous marriage, records show. The judge in the case, Charles Sandoval, had awarded primary custody of the girls to their mother and issued rulings costing the Carys hundreds of thousands of dollars.

In 2008, Sandoval ran for re-election. Prosecutors allege that in the weeks before and after the March Republican primary, the Carys paid $150,000 to a campaign consultant for Sandoval's opponent, Suzanne Wooten. She outspent and defeated the longtime incumbent. Wooten, the Carys, and the consultant, Steve Spencer, were indicted Oct. 14. Each faces six counts of bribery and one count of engaging in organized criminal activity, all felony charges carrying prison terms if they're convicted. The indictments allege Wooten accepted the money for favorable rulings in the 380th District Court. They don't detail the cases involved, how Wooten influenced them, or how money may have been passed from Spencer to Wooten. But David and Stacy Cary were parties together in just one case in the 380th, the one in which they were seeking custody of his daughters, now 10 years old. Wooten recused herself from the case. Her reason, according to her attorney, was that a lawyer for the girls' mother had served as treasurer for Wooten's judicial campaign. Peter Schulte, Wooten's attorney, said the prosecutors' case on bribery charges is weak. "A lot of it doesn't add up for the state because it didn't happen," Schulte said. "People can blow smoke in multiple directions. That doesn't mean there's fire." Keith Gore, who is representing the Carys, said there is a completely innocent explanation for the couple's payments to Spencer. He declined to elaborate. "These charges stem from a political prosecution, and the Carys deny any wrongdoing and look forward to a full exoneration," Gore said. Gary Udashen, an attorney for Spencer, reiterated that there was a legitimate reason for the payments and that Spencer is not part of any bribery scheme. "The way it's been portrayed in this indictment is flat incorrect," Udashen said. The defendants' attorneys say the charges are part of a political vendetta against Wooten launched by Collin County District Attorney John Roach, who is also a Republican. Roach asked more than a year ago that the Texas attorney general's office assign a prosecutor to investigate Wooten over campaign violations. A feud between Roach and Wooten heated up this summer. The judge alleged in court papers that Roach was intimidating and harassing her and seeking her resignation. In September, a grand jury impaneled by Wooten requested a special prosecutor to investigate "possible criminal wrongdoing" in Roach's office. And earlier this month, Roach said he would no longer submit cases to the grand jury overseen by Wooten. He said he planned to resubmit about 200 indictments made by that grand jury to a new panel. Roach declined to comment for this story, as did lawyers for the attorney general's office, which is handling the prosecution. As many as six different grand juries heard evidence related to Wooten's campaign before the bribery indictments were handed up earlier this month. It remains unclear how exactly the four defendants are connected.

People involved

David Cary, 55, is the chief financial officer of Plano-based TDi Technologies. He is active online in forums and blogs that focus on parental rights. Stacy Stine Cary, 52, owns and operates a commercial real estate company. She also runs an organization called Holistic Health of Texas. In September 2008 the couple started an advocacy group called Family Focus. On its website, the couple said they disagreed with the government disrupting families or taking away parents' rights. The site, which is registered to David Cary, says the group is "unapologetically politically active." The Carys and Spencer worked together, according to Spencer's attorney, who said he didn't know the specifics. The Carys' attorney declined to talk about the work, saying he would offer a full explanation in court filings in a few weeks. Spencer, who is 42 and lives in Dripping Springs near Austin, had worked on political campaigns before. But few details are publicly available about the kind of work he does. Many of his addresses are post-office boxes, including one for now-defunct Spen-Off Strategies, the consulting firm that Wooten paid $110,000 to during her 2008 campaign for judge. Wooten, 42, spent 12 years as a family lawyer in McKinney before making her first run for elected office. Her attorney argues that the fact that both Wooten and the Carys have worked with Spencer does not mean bribery was involved. Wooten doesn't even know the Carys, Schulte said. "To this day," he said, "she's never met them."

Custody battle

The Carys' legal battle in Collin County stems from the 2004 divorce of David and Jennifer Cary. The couple couldn't agree on custody issues related to their twin girls, who were born premature and have special education needs. Neither Jennifer Cary nor her attorney could be reached. In the summer of 2006, the couple reached an agreement through mediation to equally share in the girls' upbringing. But a social study report in the court filings raised doubts about the arrangement. The evaluator noted "difficulties that have surfaced with a number of the professionals that have worked with this family." Other court papers noted the parents' tense relationship and the girls' troubles transitioning between two households. After a three-day bench trial in October 2006, Sandoval named Jennifer Cary the sole managing conservator for the girls. In the order signed Dec. 1, the judge noted, among other things, David Cary's inability to work effectively with therapists, counselors and school officials as well as his "inability to share the rights, powers and duties to co-parent and cooperatively raise the children." Jennifer Cary got custody of the girls during the week and every second weekend of the month. David Cary had them on the other weekends. Sandoval's order went so far as to detail how the girls would be dropped off when the parents traded custody. The ruling spelled out David Cary's child support payments, the $30,000 he owed each year for the children's education fund and the $416,543 he had to pay to cover his ex-wife's attorney fees. His objections, motions to transfer to another court in Dallas County, and filings with the Court of Appeals and the Supreme Court of Texas in the ensuing months were generally denied. Then in June 2007, Sandoval granted Jennifer Cary's motion for sanctions, finding that one of David Cary's motions "was filed frivolously or designed to harass" his ex-wife. Sandoval ordered both David Cary and his attorney to pay $50,000 to Jennifer Cary. Shortly after that, the judge also ordered David Cary to pay $14,500 for his ex-wife's attorney fees.

District court race

In the summer of 2007, as the Carys were filing motions in court, Steve Spencer was looking for someone to run against Sandoval, who'd never drawn an opponent since taking office in 1997. McKinney attorney Michael Puhl said Spencer approached him about running. Puhl had some experience, having campaigned unsuccessfully for another district court bench in 2006. The two talked on the phone and then met in person, Puhl said. Spencer never mentioned the Carys but said he was affiliated with home-school interests. Spencer said his group would help finance Puhl's campaign and provide workers if he chose to run, Puhl said. "He said they thought I was a good candidate," Puhl said, "and he was encouraging me to run against Charles Sandoval." Puhl said they didn't discuss any of Sandoval's specific rulings. "It was just general disappointment. I never thought of it as, 'I'm trying to influence you to give me a ruling.' " Puhl opted not to run. He said Wooten told him later that she had decided to run and that Spencer had approached her. No one recruited Wooten to run for judge, Schulte said. She had been considering running for six years, he said. She wanted to be a judge, in part, because the hours were more predictable than private practice, Schulte said. Udashen said he didn't know how or why Spencer became Wooten's campaign consultant. He said Spencer didn't know Wooten before he joined the campaign.

Wooten's campaign

Wooten's campaign for judge got off to a slow start. Her first campaign finance report, filed in January 2008, showed $2,045 in contributions and $1,933 in expenses – $1,500 went toward the county's filing fee and the rest to Signs by Randy. Her second campaign finance report, filed eight days before the primary election, showed $9,125 in contributions and $11,734 in expenses. Her first recorded payment to Spen-Off Strategies was Feb. 13, 2008. She ultimately spent $110,341 with the firm for campaign services that included radio ads – an unheard of expense in a local judicial race. Sandoval's campaign expenses of $43,112 were no match for the $125,083 that Wooten spent. She handily beat the incumbent judge with 57 percent of the vote. The bulk of her campaign contributions came in after she'd won the primary. She also loaned her campaign $33,369 to cover the remaining invoice from Spen-Off. Wooten had no opposition in the November general election and took office Jan. 1, 2009.

Another custody battle

Before the month was out, David Cary petitioned to reopen the case related to his children. Wooten recused herself. Selecting her replacement became the job of John Ovard, presiding judge of the First Administrative Judicial Region in Dallas. Ovard, who handles judicial assignments for 34 counties in northeast Texas, including Collin, said he chooses from a pool of 40 to 50 visiting judges. In the Carys' case, Ovard said, he chose Judge John McCraw because McCraw had been an appeals court judge, because the Carys' child-custody case had been referred from the Court of Appeals back to the 380th state district court and because David Cary had been sanctioned. "Sanctions are unusual, rather complex matters," Ovard said. "My thinking at the time was that Judge McCraw, with his experience, would be a good one to handle that."

New outcome

Court documents appealing the sanctions argued that there was no evidence of harassment or frivolousness on David Cary's part. After several hearings, McCraw set aside the sanctions order.

David and Jennifer Cary went back into mediation.

Earlier this year, McCraw found that Sandoval's 2006 order was not in the children's best interests. He noted that since Jennifer Cary remarried and moved to Fort Worth, the girls had to travel 50 miles each way to their school in Dallas. McCraw noted that commute was "detrimental and potentially dangerous" for the girls. He also said that Jennifer Cary had alienated the girls against their father and falsely accused him of abusing the girls and misusing alcohol and drugs. McCraw ordered the couple to once again be joint managing conservators, but he gave David Cary primary custody during the week and every second weekend of the month. The girls' mother got custody on the remaining weekends, and they split summers and holidays. Jennifer Cary has appealed McCraw's decision.

What's next

Last week, the State Commission on Judicial Conduct suspended Wooten with pay until the charges against her can be resolved. Schulte said it's much easier for prosecutors to get an indictment than a conviction. "Getting from indictment to beyond a reasonable doubt is a whole different ballgame," he said. Wooten won't consider a plea bargain and plans to go to trial, Schulte said. "She's not guilty, so she's going all the way." Roach, whose office initiated the investigation of Wooten, likely won't be there. The longtime district attorney didn't seek re-election, and leaves office at the end of the year. vwigglesworth@ dallasnews.com, ehousewright@ dallasnews.com, mhaag@dallasnews.com

State Lawyer Arrested as Probe of Harassing Calls Unfolds

Lawyer arrested as probe of harassing calls unfolds
The Albany Times Union by BRENDAN J. LYONS - October 22, 2010

ALBANY, NY -- An attorney who works for New York state and was formerly a longtime employee of the New York Police Department is in police custody in connection with an investigation into numerous threatening telephone calls that were made to people who live on his street, according to officials familiar with the matter. James J. Hennessey Jr., 58, was taken into custody early Friday in connection with the ongoing investigation by the FBI and Albany detectives, according to a person briefed on the case. State records show Hennessey is an attorney with the Department of Civil Service and his annual salary is listed as $104,080. Hennessey was arraigned in City Court and charged with two counts of aggravated harassment, a felony. Bail is set at $15,000. Hennessey is due back in court on Wednesday. It is unclear whether Hennessey was a police officer for the NYPD. The investigation centers on allegations that Hennessey used an online service to cloak his telephone number and to make it appear the harassing and racially charged telephone calls were coming from other locations, including an office tied to the Ku Klux Klan, sources said. Police records show that Hennessey filed at least two complaints with Albany police several years ago alleging someone had done damage to his home and vehicle. A police spokesman said information about the investigation will be made available later Friday.

Judge to Stand Trial Over Perjury

Retired Mich. judge to stand trial over perjury
The Associated Press by ED WHITE - October 1, 2010

DETROIT, MI — A retired Detroit-area judge was ordered Wednesday to stand trial on criminal charges, five years after privately agreeing with prosecutors to conceal the identity of a paid police informant in a 103-pound cocaine bust. Mary Waterstone acknowledges that she allowed the informant and officers to lie about his relationship with Inkster police when he testified at trial in 2005. She said she did it to protect the safety of informant Chad Povish. The attorney general's office, however, said jurors and defense lawyers had a right to know. Judge David Robinson Jr. of 36th District Court agreed, and ordered Waterstone to go to trial on four felony charges, including improper communications and concealing perjured testimony. Robinson said Waterstone's actions violated a fundamental tenet of the justice system: "To seek the truth." "This is an extraordinary case involving an extraordinary set of circumstances," he said. Waterstone, 70, declined to comment. Her lawyer, Gerald Evelyn, said he would try to get the charges thrown out in Wayne County Circuit Court, where Waterstone was a judge for 10 years. "You make a mistaken call and now you're charged here with a crime. ... Mr. Povish's life was hanging in the balance," Evelyn told Robinson. Povish said this week that he was repeatedly told by then-prosecutor Karen Plants and Inkster police to lie about being an informant when he testified against Alexander Aceval in 2005. Assistant Attorney General William Rollstin said Waterstone's lack of personal gain in the case is irrelevant. She "willfully allowed perjury to go to the jury," Rollstin said in court. Plants, Wayne County's former top drug prosecutor, was ordered Tuesday to stand trial on conspiracy and other charges. Officers Robert McArthur and Scott Rechtzigel will also go to trial. Povish was arrested while transporting the cocaine. He was paid $4,500 for working with police but had hoped to get thousands more. He's considering a lawsuit. Aceval's 2005 cocaine trial ended in a mistrial when jurors couldn't reach a verdict. He later pleaded guilty and is in prison until at least 2015. He's now trying to get the plea thrown out on grounds that it was part of a tainted legal process. The Michigan Court of Appeals has said Waterstone and Plants' conduct was "disgraceful." The state Judicial Tenure Commission, which serves as a watchdog of judges, did not file a formal complaint but scolded Waterstone. The Attorney Grievance Commission has a complaint pending against Plants.

World Justice Report: U.S. Behind on Rule of Law

US Lags Well Behind Other Wealthy Nations on Rule of Law, Report Says

The American Bar Association Journal by James Podgers - October 14, 2010

Access to justice ranking chart from report.

A U.S. justice system already pummeled by blows from the Great Recession is getting more bad news this morning. A report released by the World Justice Project—a 3-year-old initiative sponsored by the ABA and a number of other organizations representing various disciplines—says the United States lags behind other leading developed nations on all but one of nine key measures of adherence to the rule of law. The findings for each country are based on surveys of some 1,000 residents in three leading cities as well as experts in the law and other disciplines. The good news is that the U.S. ranks no lower than 11th among 35 countries covered by the index on any of nine key rule of law principles. But when compared with 10 other nations designated in the index as "high income," the United States ranks near the bottom in nearly all of those categories. Every major region of the world is represented in the index. Peer groups of nations are categorized by the index on the basis of socioeconomic factors and region, but not form of government.

Notably, the United States ranks at the bottom of both its 11-nation economic group and its seven-nation regional group (Western Europe and North America) on providing access to civil justice through the courts and representation by attorneys or other legal professionals. The other members of the high-income group are Australia, Austria, Canada, France, Japan, the Netherlands, Singapore, South Korea, Spain and Sweden. The Western European nations and Canada also make up the regional group with the United States. Access to civil justice services already is a growing concern in the United States as recessionary pressures are leading many states to reduce funding for their court systems. In some jurisdictions, courthouses have been closed or hours cut back and trials limited. Meanwhile, the Legal Services Corp. uses data from the most recent census to estimate that nearly 57 million Americans—the highest number ever—now qualify for assistance from local legal aid programs. The LSC supports those programs with funding from Congress. Other studies estimate that legal aid offices and pro bono efforts by private attorneys meet only about 20 percent of the civil legal needs of poor Americans. Recognizing the growing crisis, ABA President Stephen N. Zack in August appointed a Task Force on the Preservation of the Justice System to focus on how the recession is affecting access to justice for Americans. When Zack, who is administrative partner in the Miami office of Boies, Schiller & Flexner, announced the task force as one of his primary initiatives, he warned that "the potential to lose the rule of law in our country is very real."

While the low U.S. score on access to justice reinforces concerns in that area, the United States scores only barely higher in the Rule of Law Index on the other factors that the World Justice Project has identified as key components of a rule of law regime that helps support societies based on opportunity, equity and respect for individual rights. Those factors are limits on government power, on which the United States ranks ninth out of the 11 countries in its income group; whether government operates with an absence of corruption (U.S. rank: 10); whether laws are clear, publicized and stable (U.S. rank: 9); whether society enjoys order and security (U.S. rank: 9); whether fundamental human rights are respected (U.S. rank: 10); whether laws are enforced in a fair manner (U.S. rank: 8); and whether an effective criminal justice system is in place (U.S. rank: 7). The United States scored highest—third among its 11 income group peers—for having an open government process.

Among the nations in the high income group, Sweden, the Netherlands and Austria ranked highest on most of the rule of law factors. Japan and Singapore also scored at the top on some factors. But because the Rule of Law Index is primarily statistical in nature, it does not offer extensive analysis of these patterns. "While the Index is helpful to tracking the 'temperature" of the rule of law situation in the countries under study," states the report issued today, "it is not powerful enough to provide a full diagnosis or to dictate concrete priorities for action. No single index can convey a full picture of a country's situation. Rule of law analysis requires a careful consideration of multiple dimensions—which vary from country to country—and a combination of sources, instruments, and methods."

Speaking at a briefing session in Washington, D.C., where the index was released, World Justice Project chair William C. Hubbard said, "Everyone in this room wants progress and a stronger rule of law, but we're not here with a one-size-fits-all approach to improving the rule of law." Rather, the purpose of the index is to produce data that help each country identify areas for possible reform, said Hubbard, a partner at Nelson Mullins Riley & Scarborough in Columbia, S.C., who is immediate past chair of the ABA House of Delegates. The report also cautions against the temptation to use the index results as a simple ranking exercise. Representatives of the World Justice Project said the index is an important addition to rule of law studies, primarily because it seeks to measure specific elements that define the rule of law on the basis of how those elements actually apply to the real lives and experiences of people in various countries. "This kind of tool is most important," said Ellen Gracie Northfleet, the former chief justice of Brazil who sits on the World Justice Project's board of directors. "We can exchange our intuitive knowledge of what's wrong and what's right with measurable data." The report being released today is a more refined and complete version of the Rule of Law Index that was released in late 2009, although both versions are based on research conducted in the same 35 countries. The World Justice Project plans to update the Rule of Law Index on an annual basis, and expand it to cover 70 countries in 2011 and 100 countries—covering more than 95 percent of the world's population—by 2012.

Iviewit Files Motion to Reopen Patentgate Federal Action

Click Here to See the Filed Iviewit Motion to Reopen, with Exhibits

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

DOCKET NO: 07Civ11196 (SAS)

ELIOT I. BERNSTEIN, INDIVIDUALLY and P. STEPHEN LAMONT

ON BEHALF OF SHAREHOLDERS OF IVIEWIT HOLDINGS, INC., Plaintiffs,

-against-

MOTION

APPELLATE DIVISION FIRST DEPARTMENT
DEPARTMENTAL DISCIPLINARY COMMITTEE,
THOMAS J. CAHILL, in his official and individual
capacity, JOSEPH WIGLEY in his official and individual
capacity, CATHERINE O’HAGEN WOLFE in her
official and individual capacity, PAUL CURRAN in his
official and individual capacity, MARTIN R. GOLD in his
official and individual capacity , HON. ANGELA M.
MAZZARELLI in her official and individual capacity,
HON. RICHARD T. ANDRIAS in his official and
individual capacity, HON. DAVID B. SAXE in his official
and individual capacity, HON. DAVID FRIEDMAN in his
official and individual capacity, HON. LUIZ A.
GONZALES in his official and individual capacity,
APPELLATE DIVISION SECOND DEPARTMENT
DEPARTMENTAL DISCIPLINARY COMMITTEE,
LAWRENCE DIGIOVANNA in his official and
individual capacity, DIANA MAXFIELD KEARSE in
her official and individual capacity, JAMES E.
PELTZER in his official and individual capacity, HON.
A. GAIL PRUDENTI in her official and individual
capacity, STEVEN C. KRANE in his official and
individual capacity, HON. JUDITH S. KAYE in her
official and individual capacity, KENNETH
RUBENSTEIN, ESTATE OF STEPHEN KAYE,
PROSKAUER ROSE LLP, MELTZER LIPPE
GOLDSTEIN & BREISTONE LLP, LEWIS S.
MELTZER, RAYMOND A. JOAO, FOLEY LARDNER
LLP, MICHAEL C. GREBE, WILLIAM J. DICK,
DOUGLAS A. BOEHM, STEVEN C. BECKER,
STATE OF NEW YORK COMMISSION OF
INVESTIGATION, LAWYERS FUND FOR CLIENT
PROTECTION OF THE STATE OF NEW YORK,
THE FLORIDA BAR, LORRAINE CHRISTINE
HOFFMAN in her official and individual capacity,
ERIC TURNER in his official and individual capacity,
JOHN ANTHONY BOGGS in his official and individual
capacity, KENNETH MARVIN in his official and
individual capacity, THOMAS HALL in his official and
individual capacity, DEBORAH YARBOROUGH in her
official and individual capacity, VIRGINIA STATE BAR,
ANDREW H. GOODMAN in his official and individual
capacity, NOEL SENGEL in her official and individual
capacity, MARY W. MARTELINO in her official and
individual capacity, and John Does., Defendants

ORAL ARGUMENT REQUESTED

PLAINTIFFS’ MOTION TO REOPEN DOCKET NO. 07-CIV-11196

BASED ON EXCEPTIONAL CIRCUMSTANCES

Plaintiff, P. Stephen Lamont, individually, and on behalf of shareholders of Iviewit Holdings, Inc. moves this Court for an order reopening the above captioned case, Docket No. 07-Civ-11196 (SAS), based upon exceptional circumstances that ensued after the Court’s granting of Defendants’ Motion to Dismiss and its Opinion and Order of August 8, 2008 (“Order”). Respectfully, the Court should take notice that not all Defendants are parties to this Motion (see CAUSES OF ACTION AND DEFENDANTS).

BACKGROUND

Beginning in 1997, Inventors of Iviewit Holdings, Inc. (“Iviewit”) developed video and imaging technologies (the "Inventions") that use significantly less bandwidth than other technologies, provide a way to "zoom almost infinitely on a low resolution file with clarity," and were quickly incorporated into almost every digital camera, DVDs, televisions, cable and satellite and terrestrial television broadcasting, certain websites, and application specific integrated circuits (“chips”); factually, Plaintiffs stake the claim as inventors of “digital zoom,” a feature present on most if not all video capture devices. Defendant Proskauer Rose LLP, a New York law firm, was recipients of disclosures regarding the Inventions through Proskauer partner, Christopher C. Wheeler. Several weeks later, Proskauer represented that purported partners, Defendants Kenneth Rubenstein and Raymond A. Joao, would secure patents for the Inventions. Simultaneously, Rubenstein was also counsel to MPEG LA LLC, one of the largest competitors and benefactors of the Inventions. In fact, Petitioners allege that Rubenstein was part of a scheme to sabotage the Inventions so as to preserve and benefit MPEG LA LLC.

BASES FOR REOPENING

Standard of Review

Fed. R. Civ. P. Rule 60(b)(6) allows a party to seek relief from a final judgment for any other reason justifying relief from the operation of the judgment. The Third Circuit “has consistently held that the Rule 60(b) ground for relief from judgment provides for extraordinary relief and may only be invoked upon a showing of exceptional circumstances” Coltec Indus., Inc. v. Hobgood, 280 F.3d 262, 273 (3d Cir. 2002) (see also, e.g., Gonzalez v. Crosby, 545 U.S. 524, 535 (2005) where the court stated “[O]ur cases have required a movant seeking relief under Rule 60(b)(6) to show ‘extraordinary circumstances’ justifying the reopening of a final judgment.”); Ackermann v. United States, 340 U.S. 193 (1950), Stradley v. Cortez, 518 F.2d 488, 493 (3d Cir.1975). Notwithstanding that, in some instances, Plaintiffs original pleadings may be facially defective under FRCP Rule 8(a) and Rule 12(b), Plaintiffs argue that enough facts are plainly and simply pled to identify the who, what, where, when, and how of the allegations that sufficiently state claims that will become more fully evident through discovery; this Court, simply, must allow discovery to take place.

Exceptional Circumstances

On October 3, 2008, Plaintiffs filed a Notice of Appeal of the District Court’s Order with the United States Court of Appeals for the Second Circuit, Bernstein, et al v. Appellate Division First Department Disciplinary Committee, et al. (08-cv-4873, CA2 NY, filed October 3, 2008). That just after filing such appeal, Plaintiffs, and on January 14, 2009, as movants, filed a motion with the New York State Supreme Court Appellate Division First Department (“First Department Court”) requesting an order requiring the immediate investigation of Thomas J. Cahill (“Cahill”), attached herein as Exhibit A; Cahill was a Respondent in the Second Circuit appeal and a Defendant in the District Court case. Whereby, on January 27, 2009, the Cahill complaint was immediately dismissed by Special Counsel Martin R. Gold (“Gold”), also a Respondent in the Second Circuit appeal and a Defendant herein, attached as Exhibit B. On May 13, 2009, the First Department Court denied movants motion in a decision rendered by, among others, Hon. Richard T. Andrias and Hon. David B. Saxe, attached herein as Exhibit C; Hon. Andrias and Hon. Saxe were both Respondents in the Second Circuit appeal and Defendants herein. Praying for relief of conflicts of interest and appearances of impropriety, on May 22, 2009, Plaintiffs moved the First Department Court for an order vacating the Cahill disposition by Respondent Gold and the denied motion rendered by Respondents Hon. Andrias and Hon. Saxe, attached herein as Exhibit D. The First Department Court summarily denied such motion on October 28, 2009, attached herein as Exhibit E.

Similar Pattern of Racketeering

If it were not for the actions of the above Respondents (Defendants in this Court’s 07-cv-11196), Plaintiffs would not be availing the Court for a Motion to Reopen, but since their incomprehensible actions gives the situation exceptional substance to support Plaintiffs’ original cause of action in 07-cv-11196, civil racketeering as evidenced by Exhibit B and Exhibit C, Plaintiffs must respectfully ask this Court to grant this prayer for relief.

CAUSES OF ACTION AND DEFENDANTS

Causes of Action

Should this Court grant this prayer for relief, Plaintiffs move to re-open the case based solely on two federal causes of action in the original complaint: violation of 42 U.S.C. 1983 (which this Court likened to our direct constitutional claims in its Order and Opinion) and violation of 18 U.S.C. § 1961-1968, the Racketeer Influenced and Corrupt Organizations Act; various supplemental claims and new defendants may also be included in any Amended Complaint.

Defendants

Plaintiffs move to reopen the case as to only the following defendants in the original complaint:
Appellate Division First Department Departmental Disciplinary Committee, Thomas J. Cahill, in his official and individual capacity, Paul Curran in his official and individual capacity, Martin R. Gold in his official and individual capacity , Hon. Richard T. Andrias in his official and individual capacity, Hon. David B. Saxe in his official and individual capacity, Appellate Division Second Department Departmental Disciplinary Committee, Lawrence DiGiovanna in his official and individual capacity, Diana Maxfield Kearse in her official and individual capacity, James E. Peltzer in his official and individual capacity, Steven C. Krane in his official and individual capacity, Kenneth Rubenstein, Proskauer Rose LLP, Meltzer Lippe Goldstein & Breistone LLP, Lewis S. Meltzer, Raymond A. Joao, Foley Lardner LLP, William J. Dick, Douglas A. Boehm, Steven C. Becker, The Florida Bar, Lorraine Christine Hoffman in her official and individual capacity, Eric Turner in his official and individual capacity, John Anthony Boggs in his official and individual capacity, Kenneth Marvin in his official and individual capacity, Virginia State Bar, Andrew H. Goodman in his official and individual capacity, Noel Sengel in her official and individual capacity, Mary W. Martelino in her official and individual capacity, and John Does.

Causative Relationships of the Above Defendants

That the exceptional circumstances inherent in filing this Motion to Reopen are limited strictly to Defendants Cahill, Gold, Hon. Andrias, and Hon. Saxe, may it please the Court, their actions are the expressions of these Defendants as agents that cause incomprehensible actions, to wit, the protection of Defendants Proskauer Rose LLP, Kenneth Rubenstein, Meltzer Lippe Golstein & Breitsone LLP, Raymond A. Joao, Foley Lardner LLP, William J. Dick, Douglas A. Boehm, Steven C. Becker, and their respective respondeats superior who neglected to supervise their actions, in the sabotage of Plaintiffs backbone, enabling video and imaging technologies for the benefit of MPEG LA LLC. That in their collusion to protect the above named Defendants and continue to block Plaintiffs’ Inventions for the benefit of MPEG LA LLC, Defendants New York State Actors, Florida Bar Defendants, and the Virginia Bar Defendants similarly undertook such actions as agents of the aforementioned Defendants that cause incomprehensible actions, to wit, the protection of Defendants Proskauer Rose LLP, Kenneth Rubenstein, Meltzer Lippe Golstein & Breitsone LLP, Raymond A. Joao, Foley Lardner LLP, William J. Dick, Douglas A. Boehm, Steven C. Becker, and their respective respondeats superior who neglected to supervise their actions, in the sabotage of Plaintiffs backbone, enabling video and imaging technologies for the benefit of MPEG LA LLC.

CONFLICT OF INTEREST AND APPEARANCE OF IMPROPRIETY IN THE REPRESENTATION OF THE STATE ACTORS BY

THE OFFICE OF ATTORNEY GENERAL

As the “People's Lawyer,” the Office of the Attorney General (“AG”) serves as the guardian of the legal rights of the citizens of New York, its organizations and its natural resources. In its role as the State's chief legal counsel, the AG not only advises the Executive branch of State government, but also defends actions and proceedings on behalf of the State1. As it relates to the instant Motion to Reopen, this Court cannot allow the AG to act on behalf of the State Defendants in neither their official capacity nor individual capacity as by its self proclaimed mandate above, “People’s Lawyer” vis`-a-vis State’s Chief Legal counsel, strongly suggests a incomprehensible conflict of interest and appearance of impropriety when no mention is made of an ethical barrier between different departments of the AG’s office to avoid conflicts of interest and appearances of impropriety, in complete separation of such bilateral functions. Where even in their reply papers, should the AG plead the existence of such a separation of interests (“People’s Lawyer vis`-a-vis State’s Chief Legal counsel) their still exists such a conflict and impropriety. After a multiplicity of complaints filed with the AG, and through several administrations, requesting that the AG should criminally prosecute such lawyers, law firms, and public officers, for harming the “People” (in this case Plaintiffs who seek the fruits of their labor to create the Inventions), instead the AG turns around and represents these same individuals complained of. Accordingly, this Court, however, must now disqualify the AG from any representation of the State Defendants in their official and individual capacities as a result of these conflicts of interests and appearances of impropriety.

CONCLUSION

For all the foregoing reasons, Plaintiffs move for a reopening of the action and relief from the Court's August 8, 2008 Opinion and Order whereby the Court granted Defendants’ Motion to Dismiss and a disqualification of the AG’s office in representing the New York State Actors, else Plaintiffs are deprived of rights, powers, or privileges in this action..
Attorney for Plaintiffs
P. Stephen Lamont, Pro Se
35 Locust Avenue, Rye, N.Y. 10580 - Tel.: (914) 217-0038
By: P. Stephen Lamont

AFFIDAVIT OF SERVICE

I hereby certify that a true and correct copy of the foregoing has been furnished to all defendants by facsimile this 11th day of October 2010. Defendants are served by facsimile as opposed to hand delivery to the Court for the sake of Pro se expediency.

P. Stephen Lamont, Pro Se

Joanna Smith/Gregg M. Mashberg Proskauer Rose LLP
Counsel for the Proskauer Defendants - Facsimile: (212) 969-2900

Monica Connell, Esq. - Office of the New York State Attorney General
Counsel for the New York State Defendants Facsimile: (212) 416-6075

Kent K. Anker, Esq. - Friedman Kaplan Seiler & Adelman LLP
Counsel for the Foley Larder LLP Defendants - Facsimile: (212) 373-7944

John W. Fried, Esq. - Fried & Epstein LLP
Counsel for Defendant Joao - Facsimile: (212) 268-3110

Stephen H. Hall - Office of the Virginia State Attorney General
Counsel for the Virginia Defendants - Facsimile: (804) 786-1991

Richard Howard - Meltzer, Lippe, Goldstein & Breitstone
Counsel for Meltzer Defendants - Facsimile: (516) 747-0653

Glenn T. Burhans/Bridget Smitha
Greenberg Traurig LLP

Counsel for Florida Bar Defendants - Facsimile: (850) 681-0207

CLICK BELOW TO SEE EXHIBITS

Click Here to See the Filed Iviewit Motion to Reopen, with Exhibits

Judge Rips Lying Cops

Years after cabbie was crippled, judge finally rips NYPD cops who covered for drunk colleague
The New York Daily News by Benjamin Lesser - October 7, 2010

Justice Lewis Bart Stone calls NYPD coverup 'disgusting.'

NYPD cops engaged in a "disgusting" coverup for a drunken colleague who mowed down a cabbie, paralyzing him for life, a Manhattan judge has found. "The statements made by this victim about a police coverup are totally believable ... and most likely occurred," Supreme Court Justice Lewis Bart Stone declared. "It is disgusting what they did to prevent justice from being done." Sitting in his wheelchair in Stone's courtroom in May, victim Eric Goldin felt vindicated. "It opened up a whole new world of possibilities in terms of getting some ... positive resolution from the [NYPD]," he said. Goldin's long road to the unusual open-court declaration was filled with frustration. It began Nov. 6, 1998, as he drove his cab in the early morning darkness near E. 86th St. and First Ave. Suddenly a car driven by off-duty cop Edilio Mejia slammed into Goldin, sending his cab careening onto the sidewalk. Cops responding to the scene included Police Officers Donald Houvener and Arthur Olivella. Houvener and Olivella said Mejia was being treated for a head wound when they arrived, and Goldin was unconscious on the floor of his taxi, records show. Olivella was told Mejia was a cop, records show. Goldin and Mejia were taken to New York Hospital, where Goldin's then-girlfriend, Johanna Viksne, asked if Mejia had been given a Breathalyzer test. Olivella says he told her he was not trained to perform the test. Records show Olivella and Houvener said there was "no reason to think a Breathalyzer exam was necessary as P.O. Mejia did not smell of, or appear to be, under the influence of alcohol." Goldin's brother complained to the NYPD, but the department closed the case in 1999 based largely on the cops' testimony. Olivella and Houvener were disciplined for failing to tell supervisors there were allegations Mejia had been drinking. In February 2001, Goldin obtained Mejia's hospital records. They show the cop told hospital staff he'd been drinking, and revealed a toxicology report declaring Mejia's blood alcohol level was at least twice the legal limit. Goldin sent the records to the Manhattan DA and the NYPD. Both opened new probes, which found six cops were involved in the 1998 incident, but the DA said Mejia's medical records were inadmissable because he didn't consent to release them. No charges were filed. Then on Jan. 14, 2002, it happened again. Mejia was arrested sitting in a parked car on W. 170th St. with the engine running, his speech slurred and booze on his breath. He was charged with drunken driving. The NYPD opened an internal investigation and ultimately filed departmental charges in the 1998 and 2002 incidents. In October 2002, Mejia was found guilty of DUI in the 2002 incident and sentenced to 60 days in jail. In February 2008, he was found guilty of six departmental counts, including vehicular assault and DWI. He was forced to retire in March 2008, but kept most of his pension. Eight months later, he drove a 2000 Lincoln Navigator the wrong way on the FDR and hit an oncoming car. He was again charged with driving drunk. In May, 12 years after the first incident, Goldin told his sad story in court at Mejia's sentencing. Then it was Stone's turn. "I can't fault you directly for the coverup of the cops because they all did it; they kept you away from any form of Breathalyzer while you were in the hospital after you hit [Goldin]," he said. Then Stone ripped into the other cops. "Your friends on the [NYPD], certainly, you know, gave you a bye till this point ... for you to pay the piper." Mejia got a year in jail for the FDR crash. It's unknown if any of the cops involved in the 1998 "coverup" were punished. NYPD spokesman Paul Browne refused to comment. Prosecutors declined to discuss the case. Houvener and Olivella would not comment. They remain on the force; Houvener has been promoted to sergeant. blesser@nydailynews.com

Federal Judge Arrested on Drug and Gun Charges

Ga. federal judge arrested on drug, gun charges
The Associated Press by Greg Bluestein. - October 4, 2010

ATLANTA, GA — A veteran federal judge faces drug and firearms charges after an exotic dancer at an Atlanta strip club told authorities he used cocaine, marijuana and other illegal drugs with her. Senior U.S. District Judge Jack T. Camp was arrested Friday minutes after he handed an undercover law enforcement agent $160 for cocaine and Roxycodone, a narcotic pain medication, that he intended to use with the exotic dancer, authorities said in a court document released Monday. They said they also found two firearms in the front seat of his vehicle. Camp, 67, who has presided over some high-profile cases, was released Monday on a $50,000 bond. His attorney, William Morrison, said after a brief hearing that the judge intends to plead not guilty. Morrison said Camp would probably take a leave of absence and would not preside over any more cases until the charges are resolved. "This is really a case between Judge Camp and his wife," said Morrison. "It's not about Judge Camp being a judge. It's about him being a husband."

Camp's arrest set up an unusual domino effect in the federal courthouse. The district's federal judges all recused themselves, so Magistrate Judge Charles S. Coody of Alabama was brought in to hear the case. Federal prosecutors from Washington also flew in to handle the government's arguments. The charges against Camp were laid out in a shocking eight-page affidavit released after the emergency hearing was finished. Camp met the confidential informant, who recently began cooperating with the FBI, at the Goldrush Showbar in Atlanta in early 2010 and he soon began paying her for sex and buying cocaine from her at $40 to $50 a pop, according to the records. In June 2010, Camp followed the informant to a drug dealer in Marietta to buy Roxycodone. He was also recorded in a wiretapped telephone call on Sept. 28 talking with her about getting together over the weekend to split more pills and cocaine with her, according to the charges. He showed up at a Publix parking lot in northeast Atlanta around 7:15 p.m. Friday to meet with the an undercover agent posing as the dealer. When the informant told her she was worried about his safety, the judge told her, "I not only have my little pistol, I've got my big pistol so, uh, we'll take care of any problems that come up," according to the affidavit. He handed over $160 in cash to pay for the drugs around 7:35 p.m. Ten minutes later, authorities arrested the judge and seized the two guns from the front seat of his vehicle.

The judge faces four drug-related charges and one count of possessing firearms while illegally using drugs. It's a stunning turn for Camp, a Vietnam War veteran who was appointed to the bench by Ronald Reagan in 1987. He is a former chief judge for the Northern District of Georgia. Known for wearing suspenders around the courtroom, he handled hundreds of cases before taking senior status — and a lesser caseload — in 2008. In 2004, he sentenced two men accused of killing DeKalb County Sheriff Derwin Brown to life in prison without parole. He also handled litigation from voting rights groups who sought to block Georgia from asking new voters to prove their identities and citizenship before casting their ballots. The judge also handled several high-profile drug cases, including the May 2009 sentencing on prescription-related charges of the personal doctor to a professional wrestler who killed himself, his wife and their 7-year-old son. Camp, wearing a pinstripe suit, said little during the brief hearing Monday but turned to flash a smile at his family after he walked in. He hired four defense attorneys over the weekend to represent him, and Morrison said his client was in "good spirits." "Judge Camp's wife is an extraordinarily strong woman and she's going to stand by her husband," said Morrison. "And this is a very strong man. He's going to overcome these circumstances."

Judge Re-Indicted in "Cash for Kids" Scandal

Judge Re-Indicted in "Cash for Kids" Scandal
The Legal Intelligencer by Leo Strupczewski - September 30, 2010

PHILADELPHIA, PA - A federal grand jury has handed down a superseding indictment against former Luzerne County Common Pleas Judge Mark A. Ciavarella Jr. in response to a U.S. Supreme Court ruling on the constitutionality of the federal honest services fraud statute, according to the U.S. Attorney's Office for the Middle District of Pennsylvania. U.S. Attorney for the Middle District of Pennsylvania Peter J. Smith said the indictment contains 39 counts of criminal charges against Ciavarella. That means the number of charges against the former Luzerne County judge has been reduced from 48 to 39.

The new indictment still charges Ciavarella with racketeering, fraud and money laundering, along with tax violations, while alleging he received "millions of dollars in illegal payments," along with fellow former Luzerne County Common Pleas Judge Michael T. Conahan, according to Smith. It did, however, drop charges from the 48-count indictment filed in September 2009, including four counts of tax fraud and three counts of honest services fraud. In the 48-count indictment, federal prosecutors alleged twice that Ciavarella had lied about his taxable income on IRS Tax Form 1040 in 2003, 2004, 2005 and 2006. Each allegation was for a different income amount. In the superseding indictment, however, there is only one such allegation for each year. Also, the superseding indictment drops from the 48-count indictment three counts of honest services fraud for filing "materially false annual statement[s] of interests submitted to the Administrative Office of Pennsylvania Courts." A noted difference between the indictments is the wording of the first paragraph, titled "The Parties," of the indictments. In the 48-count indictment, the document states that Ciavarella and Conahan had a "fiduciary duty to the citizens of the Commonwealth of Pennsylvania and to the Judiciary of the Commonwealth of Pennsylvania and were required to file an annual statement of financial interests with the Administrative Office of the Pennsylvania Courts." In the superseding indictment, the document states that the two judges owed a fiduciary duty to the citizens of the state and to the judiciary "to refrain from engaging in any activity prohibited by law and to refrain from being paid or accepting payment of any fee, emolument or perquisite other than the salary and expenses provided by law." Ciavarella's attorney, Al Flora of Wilkes-Barre, said he hadn't seen the superseding indictment, but knew it was tied to the U.S. Supreme Court's honest services fraud ruling earlier this year. "We knew it was going to be coming down some time ago," he said. "It was just a matter of when." Each charge is related to Ciavarella's ties to two juvenile detention facilities: PA Child Care and Western PA Child Care. The indictment also seeks forfeiture of more than $2.8 million — an amount the government alleges was the proceeds from the judges' criminal activity. The changes in the indictment are a result of the U.S. Supreme Court's decision in Skilling v. United States and two related cases to limit "honest services" fraud charges to cover only bribes and kickbacks. The law was previously used by federal prosecutors to file charges for a wide range of illicit activities

The superseding indictment was the latest twist in a story that has seen several since mid-2009, including Conahan pleading guilty in relation to the case. In July 2009, U.S. District Judge Edwin M. Kosik threw out the initial plea agreements reached between Conahan, Ciavarella and federal prosecutors, in part because of the judges' conduct following the plea agreements and their refusal to accept responsibility for the crimes they had committed. Ciavarella's public comments were self-serving, Kosik said, and Conahan was being obstructionist. Conahan and Ciavarella made a joint filing Aug. 20, 2009, petitioning Kosik to reinstate their agreed upon sentence of 87 months each in prison because neither could be found at fault for his post-plea hearing actions. Kosik rejected that Aug. 24. That same day, the former judges withdrew their guilty pleas and formally entered pleas of not guilty to the charges. In his Aug. 24 order, Kosik said in light of the presentence report and sentencing recommendation from the probation office, it was within his discretion to throw out the plea agreements. The probation officer's "assessment and justification for the recommendation" was partly the basis for Kosik's earlier conclusions that Conahan was obstructing justice, failing to discuss the motivation behind his conduct and failing to accept responsibility for his crimes, he said. "The probation recommendation characterized these failures by Conahan as based on his 'scandalous conduct,'" Kosik wrote in his Aug. 24 order. "The defense claims that a defendant is not required to admit relevant conduct beyond the offense of conviction. The court generally agrees, but the defendant was expected to admit relevant conduct related to the scandalous nature of the offense of conviction." In a telling footnote, Kosik said he had met with Conahan's and Ciavarella's lawyers twice and rejected reconsidering the plea agreements both times. He said federal prosecutors as well as the defense attorneys had urged him to reconsider the plea deals. Both sides offered to meet with him separately "to explain each side's reasons for entering into the plea agreement," Kosik said. "The offer was rejected by the court because such a meeting might impermissibly involve the court in plea bargaining," he said. Later in the body of his opinion, Kosik said: "It ill behooves both parties to want the court to consider additional reasons to be conveyed in private." A new 48-count indictment was filed by the federal government in September 2009 and the judges entered joint "not guilty" pleas. They followed that up by filing a series of pretrial motions together, charging federal officials with "outrageous government misconduct," questioning the impartiality of the judge assigned to their case and requesting a change in venue in March 2010. Conahan, however, took a surprise turn by leaving Ciavarella behind and reaching a plea agreement with prosecutors. In doing so, he admitted to accepting, along with Ciavarella, more that $2.8 million from the builder and former co-owner of a private juvenile detention facility. Conahan's plea agreement limits his exposure to one racketeering conspiracy charge, a crime that carries a maximum penalty of 20 years in prison and a fine of up to $250,000. Absent from the 21-page agreement is any minimum sentencing requirement or sentencing recommendation from prosecutors. Instead, the agreement outlines that any penalty is to be "determined by the court."

NY Lawyer WIns Appeal of Sanctions, Blasts "Insane" Judge

NY Lawyer Wins Appeal of Sanctions, Blasts "Insane Judge"

The New York Law Journal by Mark Fass - September 27, 2010

A judge's finding that an attorney in a wrongful-death action intentionally slipped his summation notes to the jury by including them within medical records did not constitute grounds for throwing out a $1.1 million settlement agreement that was reached as the jury deliberated, a state appeals court has ruled. A unanimous Appellate Division, Second Department, panel found that stipulations of settlement should be "not lightly set aside" and that defendant North Shore University Hospital failed to establish sufficient cause—such as fraud or mistake—to do so here. "The record does not establish that the defendants entered into the stipulation because they were aware that the plaintiff's attorney's typewritten summation notes had been made available to the jury," the panel held in its unsigned decision, Singh v. North Shore University Hospital, 2009-10708. The panel also threw out fines and sanctions levied by the trial judge, Queens Supreme Court Justice Peter J. O'Donoghue, against the plaintiff's attorney, Andrew Rosner, totalling more than $60,000. Mr. Rosner, the principal of a three-attorney firm in Garden City, filed the underlying wrongful-death action in 2006 on behalf of the family of Dolly Singh, a 53-year-old mother who died of myocarditis—inflammation of the heart muscle—at Long Island's North Shore University Hospital. A jury trial was held before Justice O'Donoghue in July 2009, at which Mr. Rosner argued that Ms. Singh's death could have been prevented had the hospital performed an echocardiogram. After the case went to the jury, but before it reached a decision, the two sides agreed to a $1.1 million settlement. As the attorneys later collected the exhibits that had been marked into evidence, a court officer noticed that Mr. Rosner's typewritten summation notes, which had not been admitted into evidence, were inside a hospital chart that had been reviewed by the jury. Citing those notes, the hospital moved to set aside the agreement on the grounds of mistake or fraud.

Justice O'Donoghue granted that motion and ordered a new trial, finding that Mr. Rosner "intentionally included" his notes with the medical records. The judge also, sua sponte, sanctioned Mr. Rosner $10,000, ordered him to pay the defense's trial costs, which totalled more than $52,175, and referred the matter to the Grievance Committee for the Eleventh Judicial District. Mr. Rosner appealed, vehemently denying that he intentionally passed his notes to the jury. "I have said before, and I now say again, I did not intentionally submit my summation notes to the jury," Mr. Rosner wrote in an appellate brief. "I have no personal knowledge whether my notes were actually received by the jury, and if they were, how. The only plausible explanation is that in gathering up the evidence after my summation, the Court Officer mixed up my notes with it, and did not check the evidence before he gave it to the jury. That is not fraud." Mr. Rosner also contended that accidentally passing the notes was not the type of mistake that invalidates a settlement. In its decision last week, the appeals court sided with Mr. Rosner and reinstated the agreement.The panel remitted the matter to a new Queens Supreme Court justice to determine whether Mr. Rosner should be sanctioned."Here, the defendants failed to establish a basis for the vacatur of the stipulation of settlement," the panel concluded. "Regarding the imposition of a sanction in the sum of $10,000 upon the plaintiff's attorney, the defendants did not request that relief. Furthermore, the plaintiff's attorney, who was never notified that the Supreme Court was considering granting that relief, was not afforded a reasonable opportunity to be heard on the issue of sanctions. Accordingly, the sanction must be vacated. However, since, on this record, we cannot conclude that a sanction is unwarranted, we remit the matter to the Supreme Court, Queens County, for a hearing on that issue." Justices Mark C. Dillon, Joseph Covello, Daniel D. Angiolillo and Sandra L. Sgroi sat on the panel. Mr. Rosner called Justice O'Donoghue's decision "insane" and "irrational." He said the judge, who is blind, "thinks he has the same superhero abilities" as the blind superhero Daredevil. "I don't think we should have a blind judge who is drunk with power and doesn't have the abilities he thinks he does," Mr. Rosner said. "The irrational statements he has made and the irrational conclusions he made in this case are very strong indications that he should not be on the bench." Mr. Rosner said he intended to pursue a complaint with the Commission on Judicial Conduct. The Office of Court Administration declined to respond to Mr. Rosner's comments. Justice O'Donoghue was elected to the Civil Court in 1992 and the Queens Supreme Court in 2002. Christopher Simone and Robert M. Ortiz of Shaub, Ahmuty, Citrin & Spratt in Lake Success appeared on behalf of North Shore University Hospital. Mr. Ortiz declined to comment; Mr. Simone did not return a call for comment. Mark Fass can be reached at mfass@alm.com.

Summary of Federal Judge Impeachment

Judge Thomas Porteous: Summary of 4 articles of impeachment approved
The Times-Picayune by Bruce Alpert - March 11, 2010

Summary of Articles of Impeachment from the House Judiciary Committee that were voted on Thursday by the U.S. House of Representatives.
Article I (approved 412-0)

This Article focuses on Judge Porteous's misconduct in relation to presiding over the case In re: Liljeberg Enterprises, Inc. The record reflects that Judge Porteous was engaged in a corrupt kickback scheme with the law firm of Amato & Creely, that he failed to disclose his relationship with the firm, and that he denied a motion to recuse himself from the case despite the firm=s representation of one of the parties. The kickback scheme involved appointing Mr. Creely as a curator in hundreds of cases, with fees amounting to approximately $40,000 paid to the Amato & Creely firm, approximately half of which was paid back to Judge Porteous. Judge Porteous made intentionally misleading statements at the recusal hearing intended to minimize the extent of this personal relationship with the firm. The record also reflects that Judge Porteous engaged in corrupt conduct after the bench trial and while the case was under advisement, by soliciting and accepting things of value from attorneys at the firm, including $2,000 in cash.
The Article finds that by virtue of this corrupt relationship and his conduct as a Federal judge, Judge Porteous brought his court into scandal and disrepute, prejudiced public respect for, and confidence in, the Federal judiciary, and demonstrated that he is unfit for office.

Article II (approved 410-0)

This Article focuses on Judge Porteous's corrupt relationship with bail bondsman Louis Marcotte and his sister Lori. The record reflects that as part of this corrupt relationship, Judge Porteous solicited and accepted numerous things of value, including meals, trips, home and car repairs, for his personal use and benefit while at the same time taking official actions on behalf of the Marcottes. This included setting, reducing, and splitting bonds for the Marcottes while on the State bench, and improperly setting aside or expunging felony convictions for two Marcotte employees. Judge Porteous also used the power and prestige of his office to assist the Marcottes in forming relationships with State judicial officers and others. Judge Porteous also knew and understood that Louis Marcotte made false statements to the FBI in an effort to assist his appointment to the Federal bench. The Article finds that Judge Porteous has engaged in conduct so utterly lacking in honesty and integrity that he is guilty of high crimes and misdemeanors, is unfit to hold the office of Federal judge, and should be removed from office.

Article III (approved 416-0)

This Article focuses on Judge Porteous's repeated false and misleading statements, including the concealment of debts, under oath and in disregard of a bankruptcy court's orders. The record reflects that as a Federal judge he knowingly and intentionally made material false statements and representations under penalty of perjury and repeatedly violated a court order in his case. This included using a false name and post office box to conceal his identity as a debtor in the case; concealing assets, preferential payments to certain creditors, and gambling losses and debts; and incurring new debts while the case was pending in violation of the court=s order. The Article finds that Judge Porteous's conduct brought his court into scandal and disrepute, prejudiced public respect for and confidence in the Federal judiciary, and demonstrated that he is unfit for the office of Federal judge.

Article IV (423-0)

This Article focuses on Judge Porteous's misconduct in relation to his nomination and Senate confirmation to be a Federal judge. The record reflects that Judge Porteous knowingly made material false statements about his past to both the U.S. Senate and to the FBI in connection with his nomination to the Federal bench in order to conceal corrupt relationships. In addition, Judge Porteous knew that another individual made false statements to the FBI in an effort to assist his appointment to the Federal bench. The Article finds that Judge Porteous's failure to disclose these corrupt relationships deprived the U.S. Senate and the public of information that would have had a material impact on his confirmation.

Federal Judge's Impeachment Vote Expected After Thanksgiving

Judge Thomas Porteous impeachment vote expected after Thanksgiving

The Times-Picayune by Bruce Alpert - September 22, 2010

Now that the Senate impeachment trial for New Orleans federal Judge Thomas Porteous is over, the panel's chair is predicting a vote by the full Senate later this year, probably sometime after Thanksgiving. Sen. Claire McCaskill, D-Mo., who presided over five days of hearings, with 14 witnesses by the House impeachment managers and 13 by Porteous' attorney, said the process was fair and "will stand the test of time." The hearing ended late Tuesday with three senators indicating that they don't buy one key defense argument; that it would be a bad precedent to remove Porteous on grounds he didn't answer truthfully when he said during his 1994 confirmation process he knew of no past conduct that would bring him, or President Bill Clinton, who nominated him, embarrassment. It's one of the grounds cited in four articles of impeachment approved by the House recommending the Senate remove Porteous, 63, from office. A defense witness, Colby College professor Calvin Mackenzie, an expert on federal appointments, testified it would set a bad precedent to remove a judge for answers to such a vague and subjective question. Mackenzie said he knows of no nominee who ever answered the embarrassment question yes, and yet no one has ever officially been sanctioned -- let alone faced removal from office -- for a no response. But McCaskill, the Senate chair, said it would also set a bad precedent if the Senate ignored the "no" response -- if senators are convinced the most serious allegations in the House impeachment articles have been proved. She and others specifically mentioned the charge that Porteous, while a Jefferson Parish judge, took "kickbacks," portions of fees paid to two Jefferson Parish lawyers he assigned to curatorships. Porteous' lawyers dispute the charge.

Rep. Adam Schiff, D-Calif., in questioning Mackenzie, said it is more important that Congress set a high standard for any incorrect preconfirmation statements by a federal judicial nominee because, once confirmed, the nominee gets a lifetime appointment. Other presidential appointees, he noted, can be fired. "The most significant sanction (short of impeachment) against Judge Porteous ... is that he has to take his full salary and he's not allowed to work," Schiff said. Porteous continues to receive his $174,000 salary, but has not been allowed to hear cases since U.S. Judicial Conference submitted allegations to Congress for possible impeachment of Porteous more than two years ago. The 12-member Senate Impeachment Trial Committee, evenly divided between Democrats and Republicans, is charged with submitting to the full Senate an "impartial" report on the testimony and evidence presented during the trial. If two-thirds of the senators voting approve one or more of the four articles of impeachment approved unanimously last March by the House, Porteous would become the eighth judge removed from office and lose his federal pension. Sen. Claire McCaskill of Missouri and Sen. Orrin Hatch of Utah preside over the hearing of the Senate Impeachment Trial Committee on Sept. 13. The Porteous defense team zeroed in on one issue that has drawn significant comment by members of the Senate panel; claiming his attorney suggested filing the judge's 2001 bankruptcy under the name G.T. Ortous to avoid embarrassment to the judge and his family. The filing was quickly amended to list the correct name. Former Illinois Bankruptcy Court Judge Ronald Barliant testified that as a bankruptcy judge he would not have pursued fraud allegations against Porteous because he acted on the suggestion of his lawyer, and substituted the correct name before any notice went out to creditors -- meaning no effort to "impair the system" Barliant said. But he added, "I'm not saying I condone what he did." Also testifying Tuesday was former Jefferson Parish District Attorney John Mamoulides who said that Porteous, as a Jefferson Parish judge, had a good reputation with his prosecutors. "They (assistant district attorneys) had no complaints about the judge," said Mamoulides, who was district attorney from 1972 to 1996. "The judge ran a good office from the standpoint of a trial." Under questioning by Porteous attorney Jonathan Turley, Mamoulides said the Jefferson Parish system was under a court decree to ease jail overcrowding when Porteous served. Often bail rulings were used, he said, to relieve overcrowding and still ensure that defendants would show up at their trials. Porteous, who served as a judge in Jefferson Parish between 1984 and 1994 before his appointment to the federal bench, is accused by the House of issuing bail rulings that benefited Bail Bonds Unlimited, whose executives testified that they provided Porteous with gifts, including trips, free meals, car repairs, bottles of Absolut vodka and buckets of shrimp. Under questioning from Schiff, the lead House impeachment manager, Mamoulides said when he first joined the district attorney's office as a deputy in the 1960s, he was surprised that he and his counterparts could set bail. He said he also received an $80 gift certificate shortly after taking office "for something or another," from a bail bond firm and wouldn't accept it because he considered it improper. Schiff asked several times whether he had a problem with judges taking gifts from lawyers or a bail bond company. "The judges didn't work for me; I was responsible for the assistant district attorneys," said Mamoulides, adding it wasn't illegal for judges to take gifts.

Rep. Adam Schiff, D-Calif, was leader of the five-member House team serving as prosecutors for the trial of U.S. District Judge Thomas Porteous. But after Schiff told him that Bail Bonds Unlimited executives had also taken Porteous to Las Vegas and that the judge had expunged criminal convictions for two Bail Bonds Unlimited employees, Mamoulides said: "I would think it would be improper from an ethics standpoint." Another defense witness, Marrero attorney Robert Rees, said that the process in which Porteous expunged a burglary conviction for Aubrey Wallace, a former Bail Bonds Unlimited employee, was done legally and in a transparent way. He said Porteous personally checked with the Jefferson Parish district attorney's office to make sure prosecutors didn't object. Schiff said it should have raised suspicions that Porteous moved to expunge Wallace's burglary conviction, at the request of Louis Marcotte, who ran Bail Bonds Unlimited, only after he had already won Senate confirmation. Porteous did not take the stand in his defense. Turley said the defense decided Porteous' testimony wasn't needed. Turley has argued that removing Porteous from office would set a dangerous precedent because none of the allegations ever resulted in a criminal trial, like almost all other impeachment proceedings of judges. He also noted that most of the allegations involve activity when Porteous was a state judge, before his federal appointment. His defense team has faced an uphill fight, given that Porteous couldn't muster even one vote in the House of Representatives against any of the four impeachment articles. And some senators expressed frustration with some of the testimony by Porteous' witnesses, including Mackenzie's on the appointment process. "I've sat here patiently through this lengthy testimony of yours, to be honest with you, I don't think I'm any smarter than before," Sen. James Risch, R-Idaho, told Mackenzie Tuesday. Bruce Alpert can be reached at balpert@timespicayune.com or 202.383.7861.

Just the Beginning, as Federal Judge's Impeachment Trial Ends

Federal judge's impeachment trial ends

The Washington Post FEDERAL EYE by Ed O'Keefe - September 23, 2010 11am

The Senate impeachment trial of a federal judge is over, but he'll have to wait until after the midterm elections to learn his fate. Judge G. Thomas Porteous Jr. of New Orleans was impeached by the House in March and a committee of 12 senators spent most of the last 10 days hearing 30 hours of testimony from 27 witnesses regarding the four articles of impeachment. The proceedings included tales of a Las Vegas bachelor party, buckets of shrimp and other highlights of the often-sordid state of Louisiana politics. (Colleague Ann Gerhart brilliantly captured the scene last week.) The Senate Impeachment Trial Committee, chaired by Claire McCaskill (D-Mo.), plans to submit a full report on the proceedings to the full Senate by mid-November. Aides stress that the report will not recommend how the full Senate should vote, but will instead summarize the testimony and evidence for each senator to review. Once the Senate is ready to debate and vote on the case, Porteous's lawyers and members of the House of Representatives will make their closing arguments on the Senate floor. A conviction on just one of the articles is enough to remove Porteous from office.

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Impeachment trial begins for Louisiana federal judge

The Washington Post by Ann Gerhart - Friday, September 17, 2010; A5

In his long career as a prosecutor and state and federal judge, the Honorable Gabriel Thomas Porteous of New Orleans has tried and presided over hundreds of cases involving malfeasance and misdeeds. This week, in a chilly Senate hearing room, he is the defendant, accused of decades of corruption, in an impeachment trial that could result in him being kicked off the federal bench. The trial is an extraordinary spectacle, featuring allegations that lawyers and bail bondsmen plied the judge, a reformed drinker and gambler, with gifts to gain his courtroom favor. Cash in envelopes. Bottles of Absolut and coolers of shrimp. A Vegas bachelor party for Porteous's son, complete with lap dance. It showcases both the often-sordid politics of Louisiana and a struggle over constitutional precedents. But while this is the first Senate impeachment trial since President Bill Clinton's in 1999, and the first for a member of the judiciary since 1989, the historic procedure is underway largely outside the zone of the public's attention. Amid the tumult of the midterm campaigns, Washington's attention has been occupied elsewhere. The same room, No. 216 in the Hart Senate Office Building, was packed two months ago for the confirmation hearings of Supreme Court justice Elena Kagan. Now it sits mostly empty of press and spectators.

The place is full, however, with prosecutorial heft, rare bipartisan teamwork and top-drawer defense lawyers who have increasingly been trying the patience of Sen. Claire McGaskill (D-M0.), a former city and county prosecutor who is chairing the 12-member Senate Impeachment Trial Committee. The panel will make recommendations to the full Senate, which is expected to vote on impeachment sometime after the November elections. A team of six House impeachment managers, headed by Rep. Adam Schiff (D-Calif.), a former U.S. attorney who tried public corruption cases, is prosecuting the four articles of impeachment, which also include charges that Porteous lied on his 2001 bankruptcy petition and to FBI agents who were conducting background checks after he was nominated to the 5th Circuit Court. Porteous's defense lawyers, led by Georgetown University professor Jonathan Turley, say the charges are overblown and do not rise to the "high crimes" described in the U.S. Constitution. He urged senators to consider carefully before making Porteous the only judge in U.S. history to be forced off the bench through impeachment without having been charged with a crime. "The secret is out, Judge Porteous gambled, he probably gambled too much," Turley said in his opening statements Monday, "but that's not illegal." Schiff countered that the House voted unanimously in March that Porteous's conduct was "so violative of the public trust that he cannot be allowed to remain on the bench without making a mockery of the court system."

Porteous, 63, a large, balding man with thick gold rings on each hand, is suspended from the bench but still collecting his salary. He has sat impassively at the defense table, sometimes making a note or two on a legal pad, as a string of colorful characters have spilled the alleged tale of his dishonor and human failings. His Metairie home was destroyed in Hurricane Katrina. Four months later, his wife, Carmella, died of a heart attack, his son testified Wednesday. "After that, he became very isolated, he stayed at home, he was depressed," said Timothy Porteous, also a lawyer. Mutterings about the ethics of Porteous, a state judge for ten years and former prosecutor, began almost as soon as he landed on it in 1994. He was suspected of being way too cozy with Louis and Lori Marcotte, a pair of siblings who had monopolized the lucrative bail-bond business on the West Bank, and he was one of the local judges investigated in Operation Wrinkled Robe, a wide-ranging FBI investigation into corruption at the Jefferson Parish courthouse. Two of his fellow state judges went off to jail for mooching off the Marcottes, and a third was taken off the bench by the state Supreme Court. Marcotte took the judge to Las Vegas and treated him to expensive lunches, he testified this week, and his employees fixed Porteous's fence and his cars, often returning them from the detailing shop with the vodka or shrimp left inside as a special goody bag. Lawyers slipped Porteous cash, prosecutors charge, to influence their cases before his bench. The defense says those lawyers were longtime friends just trying to help out a man they knew had fallen on tough times because of gambling debts.

The judge's longtime secretary, Rhonda Danos, testified that she picked up an envelope in 1999 from Jacob Amato, a lawyer the judge's son said he called "Uncle Jake," who had a case pending with the judge. When Danos asked Amato's secretary what was in the envelope, "she just rolled her eyes," Danos said. "I said, 'Never mind, I don't want to know.' " Prosecutors said the envelope was stuffed with $2,000 or so in cash. Danos also paid the judge's gambling markers at casinos, she testified, after he and his wife filed for bankruptcy in 2001, initially under false names. Prosecutors charge Porteous accumulated thousands of additional gambling debt after the filing and never disclosed it to the court. The impeachment trial's rules of evidence are unlike civil or criminal trials, and McGaskill often has leaned over to seek guidance from Sen. Orrin Hatch (R-Utah), the committee's vice-chairman and a longtime Judiciary Committee member. And the case is complicated, for all of the hours of narrative that would seem to place Porteous in the parade of infamous Louisiana public servants, from former Rep. William Jefferson (D-La.) with his cash in the freezer all the way back to Huey P. Long. The FBI and the Justice Department conducted a lengthy criminal investigation of corruption and declined to press charges against Porteous more than three years ago. And Porteous has said he will retire in a few months, but if the Senate voted to impeach, he would lose his substantial federal pension."The House has pursued impeachment despite the fact that Judge Porteous will retire in a matter of months and has already been severely sanctioned by the Fifth Circuit (mainly a suspension from hearing cases) for the appearance of impropriety created by his actions," his lawyers said in their pretrial brief. "If removed on the basis of an appearance of impropriety, the Senate would set a dangerously low and ill-defined standard for future impeachments."

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The Senate Impeachment Trial Committee

Pursuant to the United States Constitution, the Senate holds "the sole Power to try all Impeachments." Impeachment trials in the Senate are rare; 15 impeachment trials have been completed over the 221-year history of the Senate, while three others terminated due to the resignation of the judges in question. On March 11, 2010, the House of Representatives approved four articles of impeachment against Judge G. Thomas Porteous, Jr. of the U.S. District Court for the Eastern District of Louisiana. On March 17, 2010, the Senate organized for the impeachment trial of Judge Porteous. The Senate Impeachment Trial Committee is charged with receiving evidence and taking testimony on behalf of the entire Senate. The Committee must report "to the Senate in writing a certified copy of the transcript of the proceedings and testimony had and taken" by the Committee. In addition to a certified copy of the transcript of the proceedings and testimony, the Committee is authorized to report to the Senate a statement of facts that are uncontested and a summary, with appropriate references to the record, of evidence that the parties have introduced on contested issues of fact.