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Tuesday, May 31, 2011

2nd Circuit Continues Cover-Ups of Attorney Discipline Matters

Panel Says No Appeal When Court Declines to Discipline
The New York Law Journal by Mark Hamblett - May 31, 2011

A complainant does not have standing to appeal a district court grievance committee's decision declining to discipline an attorney, the U.S. Court of Appeals for the Second Circuit has held. The ruling Friday came in a per curiam opinion from Judges Jose Cabranes, Robert Sack and Richard Wesley in In re Attorney Disciplinary Appeal, 10-90018-am, a case in which the name of both the complainant and the attorney were withheld and the Southern District's grievance committee opted against disciplining the lawyer in a January 2010 decision.  Joining several other circuits, the Second Circuit said the relief allowed by the Southern District's Local Civil Rule 1.5(c), ranging from letters of reprimand to precluding an attorney from appearing at the bar, "is intended to vindicate the interests of the public, the bar and the district court." The circuit said, "In light of the limited measures permitted by Local Civil Rule 1.5(c), there is nothing about the committee's Jan. 27, 2010 decision that directly affects any cognizable interest of the Appellant. While the Appellant has an interest in the Committee's disciplining of attorneys who engage in misconduct, that interest results only from the Appellant's status as a member of the public at large."


In re Attorney Disciplinary Appeal, 10-90018-am

Legal Profession - New York Law Journal - 05-31-2011 - Cite as: In re Attorney Disciplinary Appeal, 10-90018-am, NYLJ 1202495536264 *1 (2cir, Decided May 27, 2011) Before: Cabranes, Sack, and Wesley, C.JJ. - Decided: May 27, 2011 - PER CURIAM:

The Appellant, who was the plaintiff in a civil case in the United States District Court for the Southern District of New York, seeks to appeal, or obtain mandamus review of, a January 27, 2010 decision of that court's Committee on Grievances declining to take disciplinary action against the Appellant's former attorney, referred to here as Attorney 1. 1 The challenged decision took the form of a letter to the Appellant, simply informing him that the Committee was "of the view that no disciplinary action is warranted." The Appellant's papers in this Court further allege that an Assistant U.S. Attorney, referred to here as Attorney 2, also engaged in misconduct, although it is not clear if those allegations are new or were first presented to the district court.


We have not yet addressed the issue of whether a complainant has standing to appeal a district court grievance committee's decision declining to discipline an attorney. However, in response to a pro se litigant's "motion" for this Court to require an attorney to show cause why he should not be suspended or disbarred, we stated that "a private person or a lawyer has no standing to participate in a disciplinary proceeding." In re Phillips, 510 F.2d 126, 126 (2d Cir. 1975)(per curiam). Although we then addressed the alleged misconduct, we made clear that the litigant who presented the misconduct charge was treated as a complainant, rather than a participant. Id. In support of our standing ruling in Phillips, we relied on two opinions that are relevant to the present issue. The first, an Eighth Circuit decision, held that an individual lacks standing to bring a federal action seeking an attorney's disbarment from a state bar or federal district court bar, or to bring an appeal from the district court's dismissal of the purported disbarment action. See Mattice v. Meyer, 353 F.2d 316, 318-19 (8th Cir. 1965); accord Starr v. Mandanici, 152 F.3d 741, 748-51 (8th Cir. 1998). The Phillips decision also cited Ginsburg v. Stern, 125 F. Supp. 596 (W.D. Pa. 1954), aff'd, 225 F.2d 245 (3d Cir. 1955) (en banc), which stated the following about a plaintiff's prior petition to the Pennsylvania Supreme Court requesting disciplinary action against several attorneys: Plaintiff's petition, just as any other complaint of professional misconduct, merely supplied information for the court's consideration.… If the court considers that no offense has been committed; or that the allegations of the complaint are insufficient, immaterial, impertinent or scandalous; or that the complaint has been filed from an improper motive; or for any other reason decides not to proceed with the matter, the complainant has no recourse.

Plaintiff is an informer and nothing more, and as such, has no right to be heard at any stage of the proceeding, save as the court or its committee may callupon him to testify. The plaintiff has averred nothing to show that his interest in the matter before the [Pennsylvania] Supreme Court differed in any particular from the interest of any other citizen and member of the bar, none of whom have any standing as a party in interest. Id., 125 F. Supp. at 603. Aside from the Eighth Circuit's decisions in Mattice and Starr, the First, Seventh, and Tenth Circuits also have found that an individual lacks standing to appeal a district court's decision not to discipline an attorney. See In re Lynn, 505 F.3d 1323, 1323 (10th Cir. 2007)(order)("A private citizen does not have standing to initiate or maintain a disciplinary proceeding, or to appeal if a court declines to discipline an attorney."); Ramos Colon v. United States Attorney, 576 F.2d 1, 6, 9 n.15 (1st Cir. 1978)("A private party cannot challenge the [district] court's decision not to discipline"; appeal dismissed, and mandamus petition denied, based on lack of standing); In re Teitelbaum, 253 F.2d 1, 2-3 (7th Cir. 1958)(holding that United States Attorney, who had been granted leave to petition the district court for the disbarment of an attorney, lacked standing to appeal from the order denying the petition); cf. Doyle v. Oklahoma Bar Ass'n, 998 F.2d 1559, 1566-67 (10th Cir. 1993) (holding that plaintiff lacked standing to bring an action, pursuant to 42 U.S.C. §1983, challenging a state bar association's failure to discipline an attorney, or to bring an appeal from the dismissal of the §1983 action). 2 The above cases are consistent with the rule that "a private citizen lacks a judicially cognizable interest in the prosecution or non prosecution of another," and therefore "lacks standing to contest the policies of the prosecuting authority when he himself is neither prosecuted nor threatened with prosecution." Linda R.S. v. Richard D., 410 U.S. 614, 619 (1973). In the present case, the district court's local rule governing attorney disciplinary proceedings in that court explicitly limits the types of "[d]iscipline or [o]ther [r]elief" that may be ordered by that court's Committee on Grievances. S.D.N.Y. Local Civil Rule 1.5(c). The Committee may impose "a letter of reprimand or admonition, censure, suspension,… an order striking the name of the attorney from the roll of attorneys admitted to the bar of th[e] court[,]… or an order precluding [a non admitted] attorney from again appearing at the bar of th[e] court." Id., Local Civil Rule 1.5(c)(1)-(3). 3 Such relief is intended to vindicate the interests of the public, the bar, and the district court. In light of the limited measures permitted by Local Civil Rule 1.5(c), there is nothing about the Committee's January 27, 2010 decision that directly affects any cognizable interest of the Appellant. While the Appellant has an interest in the Committee's disciplining of attorneys who engage in misconduct, that interest results only from the Appellant's status as a member of the public at large. Thus, the Appellant lacks standing to bring this appeal or to pursue mandamus relief. See Aurelius Capital Partners, LP v. Republic of Argentina, 584 F.3d 120, 127 (2d Cir. 2009)(noting that a nonparty has standing to appeal from a district court judgment when he or she "has an interest that is affected by the trial court's judgment" (internal quotation marks and citation omitted)); cf. Lujan v. Defenders of Wildlife, 504 U.S. 555, 573-74 (1992) ("We have consistently held that a plaintiff raising only a generally available grievance… , and seeking relief that no more directly and tangibly benefits him than it does the public at large[,]… does not state an Article III case or controversy."). 4  To the extent that the Appellant requests that this Court itself investigate or discipline either of the attorneys at issue, his request is denied, because the alleged misconduct relates primarily or exclusively to district court proceedings. Consequently, the present proceeding is dismissed in its entirety. The Appellant's motions for in forma pauperis status and other relief are denied as moot.


1. Since discipline was not imposed by the district court, we refer to the two attorneys at issue as "Attorney 1"and "Attorney 2."

2. Several years after its decision in Teitelbaum, the Seventh Circuit held that a United States Attorney had standing to appeal a district court's decision declining to discipline an attorney, where the district court itself had requested the United States Attorney to present evidence in the court's disciplinary proceeding and, after the proceeding was dismissed, authorized the United States Attorney to continue in the matter by taking "any appeal… he might determine to take." In re Echeles, 430 F.2d 347, 350-51 (7thCir. 1970). In finding that the United States Attorney had standing, the Seventh Circuit saw the appeal as essentially taken on behalf of the district court, which found itself "in the anomalous position of ruling contrary to its [own] findings." Id. Specifically, the Seventh Circuit regarded the district court's "authorization of the United States Attorney to appeal from such a result as a step toward fulfilling [the district court's] responsibility to maintain the integrity of its bar – a step it obviously felt justified in view of the paradoxical result it believed [the Seventh Circuit's] interpretation of its existing rules compelled." Id. at 350-51. The Seventh Circuit found that its prior decision in Teitelbaum did not require a different result, since the United State Attorney had not received leave to appeal on behalf of the district court in that earlier case. Id. at 350. We express no opinion as to the standing determination reached by the Seventh Circuit in Echeles, since, in the present case, the district court did not requestor authorize the Appellant to commence the present appeal/mandamus proceeding.

3. The "other relief" noted in the title of Local Civil Rule 1.5(c) consists of a non disciplinary suspension which the Committee on Grievances may impose, under Local Civil Rule1.5(c)(3), after determining that a "member of the bar of th[e] court has an infirmity which prevents the attorney from engaging in the practice of law," Local Civil Rule 1.5(b)(4).

4. In contrast to the district court's disciplinary rule, New York State law permits, under limited circumstances, the appellate divisions to order restitution in conjunction with the censure, suspension or disbarment of an attorney in a disciplinary proceeding. See New York Judiciary Law §90(6 a)(a) ("Where the appellate division… orders the censure, suspension from practice or removal from office of an attorney... following disciplinary proceedings at which it found… that such attorney… wilfully misappropriated or misapplied money or property in the practice of law, its order may require him or her to make monetary restitution in accordance with this subdivision."). However, at least one appellate division has found that a complainant did not have standing to challenge a departmental disciplinary committee's determination not to institute proceedings against the complainant's former attorney. See Morrow v. Cahill, 278A.D.2d 123, 123, 718 N.Y.S.2d 315, 316 (1st Dep't 2000)("Petitioner, who is not the licensee, does not have standing since there is no direct and harmful effect on him").

Monday, May 30, 2011

Laid-Off New York Judges Volunteering Their Services

Laid-off judges volunteering their services
The New York Post by Dareh Gregorian  -  May 30, 2011

Now that's dedication! Dozens of retired judges-turned-court referees who were laid off because of budget cuts are staying on the job for free. The state Office of Court Administration says at least 65 of the 300 judicial hearing officers (JHOs) who were let go earlier this year are staying on as volunteers. "We're very pleased about it," said Judge Lawrence Marks, OCA's administrative director. But he said he was not surprised. "Retired judges enjoy handling cases, and I think there's a real spirit of public service," Marks said. The JHOs have become an invaluable resource for judges around the state, hearing arguments on restraining orders, admissibility of evidence and fees, and helping with jury selection, freeing overburdened jurists to focus more on their cases.  The JHOs, mostly judges who were forced to hang up their robes after hitting the mandatory retirement age of 70, had been making $300 a day, far less than the average judicial salary of $140,000 a year. "The problem this year is we don't have money to pay them," Marks said. He credited one of the JHOs, retired Manhattan Supreme Court Justice Stanley Sklar, 79, with inspiring more than 60 of his colleagues, through his own volunteering, to do the same.   "I am absolutely delighted that that there are other JHOs that are volunteering," Sklar told the New York Law Journal. "We are performing a service.  "The courts are under stress. They are losing or have lost so many clerical personnel. This is just something to help the judges deal with the case loads."

Sunday, May 29, 2011

Lawyers Eyed Over 'Mob AId'

Lawyers eyed over 'mob aid'
The New York Post by Mitchel Maddux  -  May 27, 2011

A federal judge said yesterday he's "extremely troubled" by a mobster's allegation that two well-known defense lawyers passed on information to their mob clients about the whereabouts of a federal prosecutor targeted for a planned Mafia hit.  Brooklyn federal judge Nicholas Garaufis said he would forward transcripts of the wiseguy's testimony to federal and state officials who deal with ethical questions involving lawyers. Joseph Massino, the former Bonanno crime-family boss, said that in 2004, lawyers Murray Richmond and David Breitbart told clients when Assistant US Attorney Greg Andres regularly dined at Campagnola's, a Manhattan restaurant. Richmond disputed that account yesterday, insisting he never passed information to mobsters, but rather simply mentioned to another attorney that he had seen the prosecutor in the restaurant one night.  That lawyer, Tommy Lee, has since been convicted of illegally passing messages for the mob. Breitbart didn't respond to a request for comment. Massino, now a government informant, gave his testimony at a proceeding that will decide whether convicted killer Vincent "Vinny Gorgeous" Basciano, also a Bonanno crime family member, should be executed.  Massino testified Basciano wanted to kill the prosecutor at the restaurant but that the hit was called off.

Saturday, May 28, 2011

Another Call For Ethics Reform

Albany Needs Ethics Reform — Now
The New York Times  -  EDITORIAL  -  May 28, 2011

The first item on Gov. Andrew Cuomo’s post-inauguration to-do list was ethics reform. He’s been in office five months, and we’re still waiting for the bill.  While the governor has been negotiating behind closed doors with legislative leaders (shouldn’t transparency top the list of reforms?), others are acting.
 Attorney General Eric Schneiderman and Comptroller Thomas DiNapoli have announced plans to use their offices’ resources to investigate anything suspicious that involves the use of state funds. That includes no-show jobs, illegal expense reports, pension padding and bid rigging for government contracts. The Schneiderman-DiNapoli idea is a good one, but not enough. Here’s what is needed, as Mr. Cuomo laid out in his campaign “Plan for Action”:

  • An independent ethics commission with powers to investigate and punish legal violations by lawmakers and members of the executive branch. No more self-policing.
  • End “pay to play,” with stiff contribution limits for contractors and lobbyists, immediate disclosure of contributions and real punishments for breaking the rules.
  • Full disclosure by lawmakers of outside earnings and clients — with no exceptions. Lawyers whose clients have business before the state must come clean. As Mr. Cuomo wrote, “Voters cannot have complete faith in their elected representatives if they cannot assess where else those representatives are earning money.”
  • A complete overhaul of campaign finance laws, including a move to public financing of elections, limiting contributions to party “housekeeping” accounts, closing other loopholes and giving the attorney general jurisdiction to investigate and prosecute violations.
Mr. Cuomo and the Legislature have about 10 more working days before they are scheduled to leave town for the year. It’s going to take a lot to clean up Albany’s sleaze. But without real ethics reform, it isn’t possible.

More On Justice For Sale

Judge Voids Ban on Campaign Donations by Business
The New York Times by Nicholas Confessore - May 27, 2011

A federal judge in Virginia has declared unconstitutional a century-old law banning political contributions from corporations, a ruling that, if upheld, could have major implications for the rules governing campaign fund-raising and spending.  But while the ruling addressed one of the biggest issues in the ideological and partisan battle over regulating campaign donations — a question likely to be taken up at some point by the Supreme Court — the circumstances of the case left unclear how much practical and legal effect it would have.  The decision, issued Thursday by Judge James C. Cacheris of Federal District Court for the Eastern District of Virginia, did not come in one of the many legal and regulatory challenges now being mounted by proponents of loosening campaign finance restrictions. Instead, it was from the criminal trial of two Virginia businessmen accused of circumventing the law to donate tens of thousands of dollars to the Senate and presidential campaigns of Hillary Rodham Clinton.  “This was definitely something that is almost incidental in terms of the case it was decided in,” said Sean Parnell, president of the Center for Competitive Politics, a group that supports efforts to ease campaign-finance regulations.  Still, the ruling drew from and extended the reasoning in the Supreme Court’s landmark decision last year in the Citizens United case. The justices ruled in that case that the government may not ban political spending by corporations in candidate elections, but did not address the current bans on direct contributions by corporations to candidates.

In his decision, Judge Cacheris said that if corporations and people have an equivalent right to free speech under Citizens United, they also have an equivalent right to contribute to candidates, albeit within the same limits currently established by federal law.  “That logic is inescapable here,” Judge Cacheris wrote.  Federal prosecutors alleged that the two businessmen, William P. Danielczyk Jr. and Eugene R. Biagi, solicited employees of their financial firm to make campaign donations to fund-raisers hosted by Mr. Danielczyk and then reimbursed the employees with company money. Current law caps total contributions by individuals to $5,000 for each candidate in each election cycle and bans contributions from corporations and labor unions altogether.  Defense lawyers had sought to have the case dismissed, arguing that the law banning corporate contributions was itself unconstitutional in light of Citizens United. Judge Cacheris agreed.  If “corporations and human beings are entitled to equal political speech rights” under the Citizens United decision, he wrote, “corporations must also be able to contribute.”  Some election lawyers said that the decision, if upheld, could lead to the collapse of all legal limits on campaign donations, whether from corporations or individuals.  “If this case stood, it would mean the end of campaign contribution limits for everyone, because it would be so easy to get around the law through a straw or sham corporation,” said Richard L. Hasen, a law professor at the University of California, Irvine, who is helping to defend a lawsuit challenging municipal campaign laws in San Diego.  But the practical impact of the decision is unclear. Mr. Hasen and others said that Judge Cacheris’s ruling had ignored a 2003 Supreme Court decision, Federal Election Commission v. Beaumont, that upheld the ban on direct corporation contributions to federal candidates and was not specifically overturned in Citizens United.  The prosecution did not cite the Beaumont decision in its own court papers. “It’s strange that the government didn’t bring up this controlling Beaumont case in its brief and the judge didn’t bring it up,” said Mr. Hasen, who said he expected prosecutors to file a motion asking the judge to reconsider his decision.  Peter Carr, a spokesman for the United States attorney’s office for the Eastern District of Virginia, said prosecutors were reviewing Judge Cacheris’s ruling.

RELATED STORY..............

The Associated Press

ALEXANDRIA, Va. — A judge has ruled that the campaign-finance law banning corporations from making contributions to federal candidates is unconstitutional, citing the Supreme Court's landmark Citizens United decision last year in his analysis.  In a ruling issued late Thursday, U.S. District Judge James Cacheris tossed out part of an indictment against two men accused of illegally reimbursing donors to Hillary Clinton's Senate and presidential campaigns.  Cacheris says that under the Citizens United decision, corporations enjoy the same rights as individuals to contribute to campaigns.  The ruling from the federal judge in Virginia is the first of its kind. The Citizens United case had applied only to corporate spending on campaigning by independent groups, like ads run by third parties to favor one side, not to direct contributions to the candidates themselves.  Cacheris noted in his ruling that only one other court has addressed the issue in the wake of Citizens United. A federal judge in Minnesota ruled the other way, allowing a state ban on corporate contributions to stand.  "(F)or better or worse, Citizens United held that there is no distinction between an individual and a corporation with respect to political speech," Cacheris wrote in his 52-page opinion. "Thus, if an individual can make direct contributions within (the law's) limits, a corporation cannot be banned from doing the same thing."  In court papers, prosecutors defending the law said overturning the ban on corporate contributions would ignore a century of legal precedent.  "Defendants would have the court throw out a century of jurisprudence upholding the ban on corporate political contributions, by equating expenditures — which the Court struck down in Citizens United — with contributions. This is, however, equating apples and oranges," prosecutor Mark Lytle wrote in his argument to keep the indictment intact.  Peter Carr, a spokesman for the U.S. Attorney in Alexandria, which is prosecuting the case against defendants William P. Danielczyk Jr. and Eugene R. Biagi, said Friday that the office is reviewing the ruling. Prosecutors have the option to appeal the ruling to the 4th U.S. Circuit Court of Appeals in Richmond.  Defense lawyers, though, said the implications of the Citizens United case are clear.  "Corporate political speech can now be regulated, only to the same extent as the speech of individuals or other speakers," Biagi's lawyer, public defender Todd Richman, wrote in court papers. "That is because Citizens United establishes that there can be no distinction between corporate and other speakers in the regulation of political speech."  Danielczyk, 49, and Biagi, 76, who live in the Washington suburb of Oakton, Va., allegedly reimbursed $30,200 to eight contributors to Clinton's 2006 Senate campaign, and reimbursed $156,400 to 35 contributors to the 2008 presidential campaign.  Cacheris, in his ruling, allowed most of the indictment against Danielczyk and Biagi to stand. If the government does not appeal Cacheris' ruling on the constitutionality of corporate contributions, the case is scheduled to go to trial in July.

Friday, May 27, 2011

Two Ex-BigLaw Partners Guilty in Massive Tax Conspiracy

Two Ex-BigLaw Partners Guilty in Massive Tax Conspiracy
The New York Law Journal by Mark Hamblett  -  May 25, 2011

Former Jenkens & Gilchrist partners Paul Daugerdas and Donna Guerin were found guilty by a federal jury on multiple counts for their role in a massive, illegal tax shelter scheme. In the second week of deliberations, the jury in Southern District Judge William Pauley's courtroom delivered guilty verdicts against Mr. Daugerdas and Ms. Guerin, along with former BDO Seidman CEO Denis Field and banker David Parse, formerly of Deutsche Bank Alex.Brown. The jury acquitted Raymond Craig Brubaker, a former Deutsche Bank Alex.Brown banker, on all nine counts against him.  The verdict was a huge win for the prosecution team of Southern District Assistant U.S. Attorneys Stanley Okula, Jason P. Hernandez, Katherine Failla, Rachel Kovner and Nanette Davis, who presented evidence of a conspiracy to devise, market and sell tax shelters with no economic substance and provide wealthy clients with paper losses that saved them hundreds of millions of dollars in taxes.  From the opening argument in the 10-week long trial, the prosecution explained to the jury that the opinion letters were the key to the successful marketing of shelters to clients who needed legal cover if and when the Internal Revenue Service came calling.  Mr. Hernandez quoted Mr. Field during opening arguments as saying to colleagues they would be "swimming in a river of green" if they were aggressive in selling the shelters.  In Mr. Daugerdas' defense, Chris C. Gair of Jenner & Block in Chicago told the jury the opinion letters were cleared by Jenkens & Gilchrist's top tax lawyer, Michael Cook of Texas. Jenkens & Gilchrist is now defunct.  Mr. Gair said it was the job of Mr. Daugerdas to find loopholes in the tax code, which is subject to a variety of interpretations. For Ms. Guerin, Mark Rotert of Stetler, Duffy & Rotert in Chicago said, "In the law, everything's debatable," because of conflicting opinions.  For Mr. Field, Sharon L. McCarthy of Kostelanetz & Fink argued that he was merely the "head showman and marketer" of the shelters but that two members of the firm who handled day-to-day operations, and went on to testify for the government under cooperation agreements, kept Mr. Field in the dark on crucial matters. The jury, which began deliberations on May 12, convicted Mr. Daugerdas, Ms. Guerin and Mr. Field of conspiracy, with the goal of defrauding the United States and the IRS, committing tax evasion, mail and wire fraud. Mr. Parse was acquitted on that charge. Mr. Daugerdas was convicted on 18 counts of tax evasion for work he did for clients, Ms. Guerin on nine counts and Mr. Field on four counts. Mr. Parse was acquitted on three counts of tax evasion. All four were found guilty of mail fraud and a corrupt endeavor to obstruct and impede the Internal Revenue Laws. Mr. Daugerdas was also convicted of three counts of personal tax evasion. Mr. Parse is represented by Susan Brune, Theresa Marie Trzaskoma and Laurie Edelstein of Brune & Richard.  Mr. Brubaker is represented by Barry Berke and Paul Schoeman of Kramer Levin Naftalis & Frankel.  Sentencing is scheduled for Oct. 14.

Scheindlin Vacated and Remanded, Again

Scott v. City of New York, 09-3943-cv (L)
Before: Miner, Katzmann, and Hall, C.JJ.  -  09-3943-cv (L)  -  05-27-2011
Cite as: Scott v. City of New York, 09-3943-cv (L), NYLJ 1202495211696, at *1 (2nd Cir., Decided May 24, 2011)  Before: Miner, Katzmann, and Hall, C.JJ.   Decided: May 24, 2011)  ADDITIONAL CASE NUMBER -  09-5232-cv (XAP)


  • Thomas P. Puccio, The Law Offices of Thomas P. Puccio, New York, NY, for Plaintiffs-Appellee-Cross-Appellant.
  • Debrorah A. Brenner, for Michael A. Cardozo, Corporation Counsel of the City of New York, New York, NY, for Defendant-Appellant-Cross-Appellee.

This case returns to us following our remand of it to the United States District Court for the Southern District of New York (Scheindlin, J.) in December of last year. See Scott v. City of New York, 626 F.3d 130 (2d Cir. 2010) (per curiam). In that decision, we considered to what extent, if at all, our rule announced almost three decades ago in New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136 (2d Cir. 1983), allows a district court to award attorney's fees notwithstanding the fact that the applying attorney failed to keep contemporaneous time records. See Scott, 626 F.3d at 132-34. We concluded that Carey establishes what is essentially a hard-and-fast-rule "from which attorneys may deviate only in the rarest of cases," id. at 133, and that any deviations from the rule must be based on circumstances expressly found by the awarding court, in the first instance, to merit such deviation, id. at 134. Because a district court's "personal observation" of an attorney's work is not by itself a sufficient basis for permitting a deviation and awarding fees in the absence of contemporaneous records, the most recent order of the district court reinstating its original award of attorney's fees is VACATED, and the case is REMANDED for further proceedings consistent with this opinion. VACATED AND REMANDED.

Per Curiam:  This case returns to us following our remand of it to the United States District Court for the Southern District of New York (Scheindlin, J.) in December of last year. See Scott v. City of New York, 626 F.3d 130 (2d Cir. 2010) (per curiam). In that decision, we considered to what extent, if at all, our rule announced almost three decades ago in New York State Ass'n for Retarded Children v. Carey, Inc., 711 F.2d 1136 (2d Cir. 1983), allows a district court to award attorney's fees notwithstanding the fact that the applying attorney failed to keep contemporaneous time records. See Scott, 626 F.3d at 132-34. We concluded that Carey establishes what is essentially a hard-and-fast-rule "from which attorneys may deviate only in the rarest of cases," id. at 133, and that any deviations from the rule must be based on circumstances expressly found by the awarding court, in the first instance, to merit such deviation, id. at 134. Because a district court's "personal observation" of an attorney's work is not by itself a sufficient basis for permitting a deviation and awarding fees in the absence of contemporaneous records, the most recent order of the district court reinstating its original award of attorney's fees is VACATED, and the case is REMANDED for further proceedings consistent with this opinion.  A full recitation of the underlying facts of this case may be found in our original decision. See Scott, 626 F.3d at 131-32. For our purposes here, it is sufficient to state only that this dispute arises from the district court's decision to award Thomas P. Puccio $515,179.28 in attorney's fees pursuant to the Fair Labor Standards Act's fee shifting provision, 29 U.S.C. §216(b) (2006), for work performed in successfully litigating a case against the City of New York. See Scott v. City of New York, No. 02 Civ 9530 (SAS), 2009 U.S. Dist. LEXIS 78078 (S.D.N.Y. Aug. 25, 2009). Attorney Puccio did not keep contemporaneous records, and the City appealed the award, arguing that it violated the Carey rule, which explicitly requires that such records be kept.  On appeal, we parsed the language of Carey and determined that: Carey sets out unequivocally that absent unusual circumstances attorneys are required to submit contemporaneous records with their fee applications. The  permissive language at the end of the opinion recognizes that exceptions to the rule may exist. The strength with which we articulated the general rule, however, signals that any possible exceptions are minimal and limited in scope. In other words, Carey establishes a strict rule from which attorneys may deviate only in the rarest of cases. 626 F.3d at 133. We noted that there were no examples in this Circuit of attorneys receiving fees in cases in which they had failed to provide at least some contemporaneous records, and we suggested that any such instance might only be justified by truly unusual circumstances beyond the applying attorney's control. Id. at 133-34. Although there was nothing that we found in the record to indicate the presence of anything out of the ordinary, we remanded the case to the district court "so that it may explain why in its view Puccio's circumstances warrant applying an exception to the general rule in Carey." Id. at 134. We retained jurisdiction over any appeal following remand pursuant to the procedures set out in United States v. Jacobson, 15 F.3d 19, 21-22 (2d Cir. 1994). Scott, 626 F.3d at 134.

The district court on remand reinstated Puccio's original award of $515,179.28 in attorney's fees. Although it stated that it was "loathe" to make an exception to Carey based on personal observation, it did just that. Scott v. City of New York, No. 02 Civ. 9530 (SAS), 2011 U.S. Dist. LEXIS 25217, at *7-*9 (S.D.N.Y. Mar. 9, 2011). The court described the important role that Puccio played in the litigation, recounting his work at trial and participation in conferences. Id. at *7-*8. It estimated that, when reasonable travel time was included, the trial by itself accounted for 120 hours of work, and judged that it was fair to attribute to Puccio the additional 817 hours needed to justify his original award given the length of the case. Id. at *9 n.24. Overall, the district court found that it simply would be inequitable to deny Puccio an award where it knew first-hand of his work in the case and good standing among the bar. Id. at *5 , *7-*8.  An award based entirely on the district court judge's personal observation and opinions of the applying attorney, however, is contrary to Carey and must be vacated. If nothing else, permitting that basis for what should be a rare exception is completely unfair to an attorney who has done identical work, failed to keep the required contemporaneous records but whose reputation is unknown to the judge. It would also be unfair to that lesser-known attorney who has done good work but for one reason or another has failed to impress the judge. Moreover, such an "exception" is not an exception to the Carey rule at all. It is an abrogation. We interpreted Carey as conditioning attorney's fees on contemporaneous records in all but the "rarest of cases." Scott, 626 F.3d at 133. A district court judge has an opportunity to see and evaluate a lawyer's work in all cases. On appellate review there are additional considerations. As we recognized in Carey, it is difficult if not impossible for courts of appeal to meaningfully review awards based entirely on a district court's sense of fairness. 711 F.2d at 1147. Without contemporaneous records "we have little choice but to show considerable deference to the District Court's conclusion as to how many hours were reasonably compensable." Id. Abuse of discretion review in these instances, however, requires a more searching inquiry. While it is true that we will—by default—need to rely on a district court's estimate of compensable time when Carey's narrow exception is triggered, such deference is a necessary evil brought about only by some other good reason. It is not a justification unto itself.

We have been pointed to no evidence that would permit us to conclude that this case falls within an exception to the Carey rule that would justify an award of all the fees for time that might be documented by an attorney's contemporaneous records. Nonetheless, we are persuaded  that Puccio should be eligible to recover limited fees for any contemporaneously documented time that he was physically before the district court. We thus hold that entries in official court records (e.g. the docket, minute entries, and transcriptions of proceedings) may serve as reliable documentation of an attorney's compensable hours in court at hearings and at trial and in conferences with the judge or other court personnel. Where the court's docket reflects that Puccio was in the courtroom participating in trial or was in chambers in conference with the judge and other counsel,1 these entries, comparable to contemporaneous attorney time records, may be effective substitutes for Puccio's own contemporaneous records. In so holding, we hasten to add that this is not an invitation for district courts to engage in the type of conjecture that has occurred here with respect to Puccio's purported 120 hours of trial time. Instead, attorneys seeking fees must point to entries in the official court records that specifically and expressly demonstrate their presence before the court and indicate with reasonable certainty the duration of that presence. No accommodation is to be made for travel time or out-of-court preparation because that will vary from attorney to attorney and issue by issue. Finally, we emphasize that the onus of gathering the applicable docket entries and other court records, if any, is on the applying attorney, not the district court. The district courts are under no obligation to award fees based on such time. Our holding today merely clarifies that using such remedies in this limited fashion will not run afoul of Carey if the district court chooses to do so. We believe that such a regime prevents a totally inequitable result in cases such as this while, at the same time, preserving the strong incentive Carey creates for lawyers to keep and submit contemporaneous records. Accordingly, we VACATE the district court's order reinstating Puccio's attorney's fees, and REMAND the case to the district court so that it may allow Puccio to submit a new application for attorney's fees based exclusively on official court records as set out above. The district court is further instructed to apply to those hours it finds substantiated in such records the hourly rate of $550 as previously determined by the court, see Scott, 02 Civ. 9530 (SAS), 2009 U.S. Dist. LEXIS 78078, at *23 ; n.45, which we hold is reasonable. 2

1. If properly documented in the official court records, Puccio may also recover for time spent conferencing by phone with the district court.

2. Nothing stated herein is intended to preclude the parties from examining the applicable court records and, based on those records, stipulating to the attorney hours thus documented.

Thursday, May 26, 2011

Injustice is Undone

Injustice is undone
The New York Post by William J. Gorta  -  May 25, 2011

Did 4 yrs. for crime - with NO charges

It's one thing to go to prison for a crime you didn't commit -- but it's a whole other thing to do more than four years for a crime you weren't even charged with.  A Brooklyn man in the midst of an 18-year prison term was granted $75,000 bail yesterday after an appeals court heard that the crimes he was convicted of had been dismissed before his trial even began.  "I'm happy," said appeals lawyer Rita Dave, who took over Oswind David's case after an appeal on different grounds failed. David, 31, was charged in March 2006 with attempted murder after an altercation with family members at a party in Bedford-Stuyvesant, according to court papers. He was also charged with four counts of first-degree assault: two for allegedly using a boxcutter and two for intending to disfigure his alleged victims.  Police said one of the alleged victims was slashed in the neck while the other was cut in the face and neck, requiring 70 stitches.  Brooklyn Supreme Court Justice Patricia DiMango threw out the charges of using a boxcutter, saying the grand-jury presentation was insufficient to support the charge.  She told the Brooklyn DA's Office it could resubmit those counts to a grand jury, but that never happened and David went to trial on the other charges.  Amazingly, neither defense attorney David Epstein nor two assistant district attorneys nor trial Judge Cheryl Chambers noticed that jurors were allowed to consider the two dismissed counts. In December 2006, the jury acquitted David of all the other counts, including the two involving intent to disfigure, but convicted him of the boxcutter assaults, which earned him the prison term.

Monday, May 23, 2011

Judge's Ex Gets Job Ax in 'Family' Court

Judge's ex gets job ax in 'family' court
The New York Post by Melissa Klein and Isabel Vincent  -  May 22, 2011

The ex-wife of Judge Luis Gonzalez has been canned from his court along with nine others amid statewide layoffs. Gonzalez, the presiding justice of the Appellate Division First Department in Manhattan, has been accused of letting nepotism run rampant in his court, which was almost $400,000 over budget. He is under probe by a watchdog after The Post reported that he claimed two homes as a primary residence.  The judge's ex, Vivian Gonzalez, was hired as a $65,000-a-year clerk in December. Also laid off was secretary Mark Estrada, the son of the judge's ex-driver.

See Related Story, New York Post EDITORIAL, Lippman's Lip-Service

Sunday, May 22, 2011

Global Cry: Our Judges Shouldn't Judge Themselves

Our judges shouldn’t judge themselves—as angels! by Dr. Michael J.K. Bokor -  May 20, 2011

Part I

The fight against immorality in the country will continue to be difficult for as long as some people in vital sectors continue to play the ostrich. With all the persistent clamour against bribery and corruption as a major factor that hampers good governance, it is unacceptable for some people to attempt whitewashing themselves and seeking to harm those who are bold enough to tell us what we need to factor into the strategies for addressing the problem. Those whose input can help us determine how to eradicate that vice shouldn’t be discouraged from coming forth nor should anybody intimidate them. But that’s exactly what some are doing.  The Association of Judges and Magistrates is up in arms against four lawyers—Abraham Amaliba, Raymond Atuguba, David Annan, and Larry Bimi—for alleging that there is endemic bribery and corruption in the judiciary. They said so at a recent round table discussion on the Judiciary to herald the “Constitution Week” of the National Commission on Civic Education.  In consequence, they have been blacklisted and other measures lined up to “scapegoat” them. We are told that cases that they are handling will be boycotted by the judges and magistrates. The Supreme Court has already done so. Additionally, they have been referred to the General Legal Council to substantiate their allegations or….. In a show of manliness, Larry Bimi and Amaliba have already called the bluff of these judges and magistrates. I salute them and urge all Ghanaians to support their cause so that the Association of Judges and Magistrates doesn’t constitute itself into a special class of untouchables to harm our democracy!!  These public-spirited lawyers did nothing wrong to be so intimidated. They did not tell us that their allegations were figments of their self-opinionated observations. They quoted from several research findings which claimed that the judiciary was one of the most corrupt institutions in the country. Do the judges and magistrates not know that people have conducted research and drawn such conclusions? What can’t they understand or acknowledge about those conclusions to know that these four spokespeople were just re-echoing an age-old allegation as part of the negative sentiments that people harbour against the Judiciary? This Association of Judges and Magistrates is misbehaving, to say the least.  How unconscionable can these judges and magistrates be? Haven’t they heard of cases of corruption involving some of their own colleagues who were exposed and punished? Why do they think that the Judiciary is sacrosanct and insulated against a vice that is pervasive in Ghana and known to the international community too? The claims made separately by the four “scapegoats” are neither strange, surprising, nor novel. They are routine and just a continuation of the worn-out and constant negative public perception of the trend of bribery and corruption in the Ghanaian body politic. The claims are consistent with sentiments that have run their full gamut in the public domain all these years. They are nothing new or alarming to warrant the wrong-headed overreaction by the judges and magistrates.

Need we remind these judges and magistrates that over the years, the various Chief Justices themselves have had cause to complain about corruption in the Judiciary and to call for action to stamp it out? Or that the current Chief Justice (Georgina Wood) herself is on record for making public utterances to suggest that the Judiciary was not immune to corruption? Let these judges and magistrates not misconduct themselves; lest, they erode the last vestiges of public sympathy, trust, or goodwill for them.  Already, some of us are unhappy that the Judiciary isn’t doing enough to clean its own stables—a situation that drew the unfortunate warning from Dr. Kwabena Adjei, the National Chairman of the NDC, to the effect that if the Judiciary would not clean its own house, the NDC would do so for them. We all know the extent to which this “There-are-many-ways-to-kill-a-cat” veiled threat from Dr. Adjei was dragged as the matter became heavily politicized to the disadvantage of the NDC. I remember very well the manner in which the judges and magistrates reacted to Dr. Adjei’s warning. Some voices strongly urged the police to take him on and prosecute him for daring to threaten the Judiciary. Well, the dust might have settled on that matter but not the concerns that prompted Dr. Adjei’s utterance.  The judges seem not to know where they stand in the estimation of the public. If they did, they would not rush to take on their four colleagues who were only contributing ideas to arouse public interest in the fight against corruption in the system. It is no exaggeration to say that the judges and magistrates have taken matters into their own hands and are not endearing themselves to the hearts of those who want to support the fight against corruption or to put pressure on government to provide adequate resources to enhance the work of the Judiciary. Unless the judges/magistrates instill confidence in the public, they will not be supported in their fight for input to assert their independence—which will not be good for our democracy. They must know that in a situation of the kind that we have in which corruption is pervasive and is cited as a major drawback to our development efforts, any input from anybody that can lead us toward identifying possible solutions should be received with open arms and appreciated, not repudiated or cited as a lame excuse to seek vengeance.

The judges and magistrates can’t persuade me that they are angels not tainted by the corruption that has engulfed and is destroying every aspect of our local and national life. If they were angels, they would influence positively other sectors to ensure that corruption didn’t spread thus far to taint our country’s image. But angels they are not. Thus, any criticism of their work should be accepted in good faith.  There is no justification for our Judiciary to single itself out as incorruptible. Over the years, several happenings have given some of us to know that what Larry Bimi and the others said is true. The judges and magistrates are corrupt to the core and the earlier they admit it and ask for forgiveness, the better chances are that they will help us clean the stables and find ways to provide the resources that they need to perform their duties diligently. The stand to profit from such wake-up calls and must sit up! As of now, public goodwill toward their cause isn’t forthcoming, and that’s one of the reasons for their not being properly resourced. For the Judiciary to be independent and well-resourced to function without let or hindrance, its members will have to live above reproach. That’s what Larry Bimi and the others are suggesting. Their claims might have dealt a big moral blow to the judges and magistrates but that’s the true picture for them to see.  If this picture scares them stiff, it is because of the reality that it paints. It is a wake-up call for them and they should rise to the occasion instead of seeking to gag those critics. It will be better for them to use this bitter criticism as a means to an end—which is to recant and take steps to change the negative public impressions about them—than to settle on it as an end in itself.  By referring the matter to the General Legal Council, they seem to be looking for opportunities to punish their colleagues, not for them to substantiate their allegations. Any attempt to punish them will have a far-reaching negative backlash. Their allegation calls for severe introspection and an in-house search for solutions, not vengeance.  Unfortunately, though, the battle line seems to have been drawn already. We can infer from the import of the rhetoric coming from the Association of Judges and Magistrates that vengeance is their primary objective, not the desire for the truth to be established. By rushing to take action—to blacklist these lawyers and to boycott cases being handled by some of them—they have foreclosed the matter. By so doing, they have given the General Legal Council only one option, which is, to confirm their stance that the four be punished. And the punishment? Disrobe and expel them from the profession? Vengeance won’t work in this case because the four accusers will definitely be supported by the public.

Part II

The Association of Judgers and Magistrates is being wayward. After all, if it were not so, why would the judge who sat at the Supreme Court to adjudicate the case involving Dr. Atuguba’s client (Dramani Sakande, MP for Bawku Central) adjourn the case “sine die” in a direct, quick, and irresponsible response to the “blacklisting” of Dr. Atuguba? Is this not a miscalculation since the General Legal Council hasn’t yet determined the case put before it to warrant any such boycott of the case being defended by Dr. Atuguba and the others? Indeed, the decision to blacklist these four public-spirited citizens is itself fraught with mischief and is a calculated attempt to gag people whose viewpoints on the Judiciary are needed to determine how corruption should be tackled in that sector. No one should support this stance of the judges and magistrates because it is a horrible precedent that conflicts with the tenets of our democracy. Several complaints have been heard from Ghanaians about the rot in the Judiciary (consisting not only the courts but also the Police Service, Prison Service, and the Ministry of Justice and the Attorney-General’s Department). These sectors of the justice-delivery network are vital for not only dispensing justice but also for cooperating with the public to eradicate anti-social practices that undermine our democracy.

The court system can’t isolate itself for special mention or commendation if it is, indeed, part of the problem that the public has over the years identified. That’s what the judges and magistrates must be told. They are not above corruption. We have said it several times, even to a fault, that there is laxity in the justice-delivery system and that the judges and magistrates have an onerous responsibility to live above reproach—but evidence shows that they don’t. The burden is on them to persuade the public through responsible conduct that they are incorruptible, not to merely bare their teeth at those who are bold enough to take them on. Until they do so, they will be the butt of public criticism, disdain, repudiation, and anger. I wish the judges and magistrates will take a leaf from the IGP’s record of open admission of the problem of corruption in his organization and how he has responded to criticisms. Is it not a routine for people to accuse the police of corruption? How many times hasn’t the Police Administration acknowledged that accusation and indicated its preparedness to work with the public to solve the problem? Do the police blacklist people who accuse them of corruption or do they refuse to perform functions in response to such allegations? Again, how many times haven’t people accused government functionaries (including the Presidents that we’ve had) of bribery and corruption? Have they blacklisted anybody or taken the law into their own hands to do the kind of thing that the judges and magistrates have resorted to? The judges and magistrates are now completely out of control. Indiscipline has now taken the better part of them and they must be warned to rein their emotions in or end up scathed. They may be hurt by the allegation but need to take caution in their reaction because an insult is not more painful than when it is true (Shakespeare says).  I am tempted to guess that unless they take prompt action to fall back in step and stop creating negative impressions about themselves, the spate of open criticisms against their (mis)conduct will not abate.  They should expect a heightening instead for as long as they give us the negative things that will make us see them as part of the problem, not its solution. If they continue to give cause for suspicion and disquiet, they will be taken to task. Giving the public a good account of themselves should be a better way to help change the negative perception of their attitude to and performance in public-office holding. No amount of threat or misguided action (such as this so-called boycott or any other punitive measure that the General Legal Council may come up with) will intimidate anybody. We will continue to condemn the negative things that they do and praise those that will help us grow our democracy. Bribery and corruption are not restricted to only the executive and legislative branches of government. As a pervasive social canker, they reside in the Judiciary too. Admitting that fact is half-way toward helping us solve the problem. But if the judges and magistrates think that sweeping it under the rug is their solution, they will be deceiving themselves because not only will they lose public trust thereby but they will also stand alone, helpless, if the government “strangles” them by denying them the resources they need to function effectively.  We know how much former President Kufuor’s government provided for the judges/magistrates and what the current government is doing to improve their conditions of service. Committing resources to improve the lot of the Judiciary suggests that the citizens have a stake in whatever happens in that area. Not only do they have the right to question the performance of the Judiciary but they also have every right to monitor all that goes on. They are enjoined to take on anything (or anybody) whose conduct raises doubts or questions about morality. That’s what the four lawyers have risen up to do. What is criminal or reprehensible about their allegation, more so when it is based on research findings?  The effort to provide adequate resources to enhance the work of the Judiciary must be requited with decent conduct and the zeal to work assiduously to improve governance. It shouldn’t be misconstrued or abused. Our judges and magistrates should use this open criticism of them as an eye-opener to do enough soul-searching so that they can redeem themselves and rebuild their image. The allegations were made without malice afore-thought. They were the inevitable public outpourings of people whose contributions are needed to advance the cause of justice.  These people’s sentiments are representative of the pent-up feelings of those voiceless citizens who chafe at the knowledge that it is their tax money that is supporting those in public office whose conduct they don’t like but have no means to complain about. The four lawyers are mere conduits for such voiceless but aggrieved citizens. They are for now our heroes and no one will be allowed to intimidate them.  Let the Chief Justice and her Judicial Council (let alone the General Legal Council) not be deceived by their familiarity with the laws of the land that they can place themselves above these very laws that they have sworn and are charged to uphold. When the Privileges Committee of Parliament constituted itself into a “Sanhedrin” to intimidate Ghanaians who were bold enough to criticize the work of Parliament, we came out boldly to condemn it. We will do so again if given the slightest cause that some segments of our body politic want to place themselves above all of us to behave as if they are untouchable.  That’s exactly what we will do to the Judiciary too if it begins doing what will annoy us. After all, we are the tax-payers whose blood, sweat, and tears support their lifestyles. Let these judges and magistrates not overstep bounds. Otherwise, they stand to lose big time. They will have nothing to gain from these strong-arm tactics or unconscionable overreaction to genuine concerns being expressed against corruption in that sector of national life.  The Judiciary is corrupt to the marrow, I repeat. And the only way we can clean it is to join hands with those who have first-hand knowledge about this rot and to seek solutions. Working concertedly for workable solutions is the answer, not seeking vengeance.   E-mail:

Saturday, May 21, 2011

Shocking Picture of Greed and Deceit: America's Pay-to-Play System

Johnson pleads guilty to public corruption charges
The Washington Times by Andrea Noble  -  May 17, 2011

Former Prince George's County Executive Jack B. Johnson on Tuesday pleaded guilty to two felony charges involving thousands of dollars in bribes he solicited as part of a "pay-to-play" culture federal authorities say he fostered throughout his two terms in office. Johnson, who led Prince George's from 2002 to December and was the county's top prosecutor for eight years before that, entered his guilty plea in federal court in Greenbelt on charges of extortion and witness and evidence tampering. As part of the plea, he admitted accepting a $100,000 check from a county developer in exchange for securing federal funding for the developer's projects in Prince George's County. He also admitted to instructing his wife, County Council member Leslie Johnson, to destroy the check as federal agents came to his home to serve a search warrant.  "The mountain of evidence and Jack Johnson's admission of guilt paint a shocking picture of almost a decade of greed and deceit," said Leo Taddeo, assistant special agent in charge of the FBI Baltimore field office, after the hearing. Under the agreement announced Tuesday, prosecutors will not pursue six other counts.

The two counts to which Johnson, 62, pleaded guilty each carry a maximum sentence of 20 years in prison and a $250,000 fine. U.S. Attorney for the District of Maryland Rod J. Rosenstein said sentencing guidelines for the case recommend an 11- to 13-year jail sentence. Sentencing is scheduled for Sept. 15.  Both in court, where he provided hesitant answers to U.S. District Judge Peter J. Messitte's questions, and outside the courthouse after entering his guilty plea, Johnson indicated there was more to his side of the story that he was unable to share until his sentencing.  "I wish I could talk about this case and will do so in the future," said the former county executive, who dressed in a crisp dark suit and was accompanied by his attorney and an entourage of ministers.  Throughout his time as county executive, Johnson remained popular among residents. The story of his rise from a poor and rural part of South Carolina to leader of the affluent majority-black county seemed to resonate with voters, whom he often networked with at Sunday church services.  "I'm very sorry for what happened," he said. "We all sin and fall short of the glory of the Lord."  Johnson's plea agreement sheds light on the depth of corruption that ran through swaths of county government for years and names several major players who previously entered into secret plea agreements with federal prosecutors. The plea agreements of the three, doctor and developer Mirza Baig, former Prince George's County Director of Housing and Urban Development James Johnson (no relation to Jack Johnson), and developer Patrick Ricker, were unsealed Tuesday.  The plea agreements revealed Baig was "Developer A," the developer clandestinely mentioned in previous court documents. Baig, 67, of Burtonsville pleaded guilty in April to conspiracy to commit extortion and admitted to paying Jack and James Johnson between $400,000 and $1 million in bribes from 2006 to 2010. He ran Baig Ventures, a commercial and residential developer in the county since at least 1992.

In exchange for bribes, Baig received the county executive´s assistance concerning several development projects, including the receipt of $1.7 million in federal block grants to pay for the renovation of 11 homes to be rented to low-income residents.  James Johnson, 66, of Temple Hills, pleaded guilty in January to conspiracy to commit extortion and admitted to accepting bribes from both Baig and Ricker. Jack Johnson appointed him as the county's housing director in 2009.  Ricker, 52, of Bowie, pleaded guilty in December 2009 to conspiracy to commit fraud and tax evasion. The president of Ricker Brothers, a commercial brokerage and development consulting firm, Ricker admitted to concealing the value of campaign contributions that he and others made to state and local officials by soliciting straw donors. In his plea agreement, he also admitted to providing a stream of other gifts, including airline tickets, rounds of golf and sexual services to members of the county's executive and legislative branch and the Board of Education. In exchange, his company received approval on their proposed development project, Greenbelt Station.  A sentencing date has not been set for the three men.  Jack Johnson's plea agreement also shed further light on the ties between his arrest in November and the arrest of liquor store owner Amrik Singh Melhi.  According to the document, Mr. Melhi asked Jack Johnson in January 2010 to amend legislation that would allow county liquor stores to stay open until 3 a.m. Johnson said he would assist with the liquor legislation if Mr. Melhi provided funding for Leslie Johnson's campaign.  As Johnson's term as county executive wound to a close and his wife was successfully elected to the County Council on Nov. 2, Johnson seemed to begin positioning her as the power broker that developers would now have to deal with, according to portions of federal wiretaps included in his plea agreement.  In a recorded phone conversation with Baig a few days after the election, Johnson said, "Leslie is going to take, ah, chair of the zoning, ah, panel. So I told her to, ah, stay there about three years because, because everybody needs zoning. ... You've got a good County Council and they'll look out for you. I'll have Leslie to, ah, take care of things for you."  After the pair was arrested at their Mitchellville home Nov. 12, the County Council voted to strip Mrs. Johnson of some of her power on the council, including the ability to vote on development matters.  Mrs. Johnson faces evidence-tampering charges after authorities say she destroyed a $100,000 check written to Johnson from Baig. After federal agents confronted Johnson, on Nov. 12, he called his wife and was heard on federal wiretaps instructing her to flush the check down the toilet and to stash $79,600 in cash in her bra.  Federal agents searched the house, found the money on Mrs. Johnson and arrested the pair shortly afterward.  A plea hearing was scheduled earlier this month for Mrs. Johnson but it was postponed and no future court date has been set. If she pleads guilty to or is convicted of a felony offense, she will lose her seat on the council.  Mrs. Johnson did not accompany her husband to court Tuesday, but rather attended the regular Tuesday meeting of the Prince George's County Council.  Johnson's plea agreement Tuesday will have no effect on the case against Mrs. Johnson, Mr. Rosenstein said.  He said the investigation continues and additional charges are possible.

See Related Story, "When Our Trusted Offiicals Lie"

Friday, May 20, 2011

Law Partner Pleads Guilty to $837 Million Investment Fraud Scheme

Viaticals lawyer Michael McNerney pleads guilty
The Sun-Sentinel by Jay Weaver-  May 19, 2011

A prominent attorney whose fortunes rose with a Fort Lauderdale viatical insurance company at the center of a $1.25 billion investment fraud case pleaded guilty Wednesday to a single conspiracy charge, marking a major development in the long-running prosecution of executives and others at Mutual Benefits Corp.  Michael McNerney, 62, of Fort Lauderdale, admitted that as its lawyer, he helped the now-defunct company lure thousands of investors worldwide into buying dubious life insurance policies held mostly in the names of people dying of AIDS.  His role was part of an alleged investment scam lasting from 1995 to 2004 that authorities say rivals the $1.2 billion Ponzi scheme of disbarred Fort Lauderdale lawyer Scott Rothstein, convicted last year of selling fabricated legal settlements in a separate criminal case.  As part of his deal, McNerney will cooperate with prosecutors on how the alleged life settlement racket was directed by Mutual Benefits' senior executives.


Department of Justice Press Release

For Immediate Release
May 19, 2011 United States Attorney's Office
Southern District of Florida  -  Contact: (305) 961-9000

Former Founding Partner of Ft. Lauderdale Law Firm Pleads Guilty to $837 Million Investment Fraud Scheme

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (“FBI”), Miami Field Office, announce that defendant Michael J. McNerney, a founding partner of the Ft. Lauderdale law firm formerly known as Brinkley, McNerney, Morgan, Solomon & Tatum, LLP, pled guilty on May 18, 2011, to a one-count criminal information charging him with conspiracy to commit mail fraud and wire fraud in connection with a scheme to defraud investors in the Mutual Benefits Corporation (“MBC”). As part of his plea agreement, McNerney agreed to be responsible for $837 million in restitution to the investors who were victims of this fraud.  Sentencing has been scheduled for August 26, 2011 before U.S. District Judge Adalberto Jordan. At sentencing, McNerney faces a maximum statutory sentence of five years in prison.  For almost 10 years, from about October 1994 through at least May 2004, McNerney was the lead outside lawyer for MBC, and participated in a scheme through which MBC sold investment interests in viatical and life settlement insurance policies to the general public, raising more than $1.25 billion from approximately 30,000 investors worldwide. A viatical settlement is a transaction in which a terminally ill person sells the death benefit of his or her life insurance policy to a third party in return for a lump-sum cash payment, which is a discounted percentage of the policy’s face value. A life settlement is similar to a viatical settlement, except the seller is not terminally ill, but is a senior citizen. In the sale of viatical or life settlements, an investor would realize a profit if, when the insured dies and the policy matures, the policy benefit is more than the price paid for policy. Any profit realized would be decreased by additional out-of-pocket costs, such as premium payments.  As charged in the information, McNerney, as outside counsel for MBC, made and caused others to make, knowingly misleading representations concerning such matters as the management of MBC and its related entities and the sufficiency of the funds set aside to make premium payments on the investors’ policies. For example, among the misrepresentations made to investors, MBC’s sales agents falsely promised a “fixed return” on investments and falsely represented that MBC had a strong track record of accurately predicting life expectancies. In addition, McNerney and his conspirators concealed from investors and regulators the fact that Joel Steinger, a convicted felon, was the key decision maker at MBC. Through these and other misrepresentations, MBC engaged in an unsustainable Ponzi scheme, in which it used new investors’ monies to pay previous investors.  United States Attorney Wifredo A. Ferrer stated, “Attorneys hold a position of trust in our society. As such, they are expected to deal honestly and truthfully with their clients and the general public in the exercise of their duties. This attorney breached that duty and defrauded investors by providing “legal cover” to what was essentially nothing more than a Ponzi scheme. McNerney abused his position of trust and used his law license to help commit this massive fraud. Such abuse will not be tolerated.”  “This is another case about an attorney who instead of doing the right thing was motivated by his personal greed and defrauded thousands of investors out of hundreds of millions of dollars,” said Special Agent in Charge John V. Gillies. “McNerney’s actions were illegal and unethical and those who engage in such behavior need to know that they will be brought to justice, regardless of how elaborate or complex they think their scheme is.”  Mr. Ferrer commended the investigative efforts of the FBI and the Southeast Regional Office of the Securities and Exchange Commission, which previously brought a civil action against MBC and its principals. The matter is being prosecuted by Assistant U.S. Attorney Jerrob Duffy.  A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at or

Thursday, May 19, 2011

Hotelier Lippman and Pfau Continue The Injustice

'Painful But Unavoidable:' Courts Trim Jobs
The New York Law Journal by Joel Stashenko  -  May 19, 2011

Leaving 367 Positions Vacant Will Make Delays Inevitable, Administrators Say

ALBANY, NY - New York court administrators laid off 367 nonjudicial employees yesterday to comply with state budget cuts ordered by Governor Andrew M. Cuomo and the state Legislature.  Starting June 1, the positions of that many court clerks and assistants, court officers of all ranks, analysts, librarians, aides, stenographers, family counseling case analysts, court reporters and attorneys and other support staff will be vacated. And the bulk of the jobs will remain empty as the Judiciary grapples with a $170 million cut in its $2.7 billion budget.  Of the cuts announced yesterday, 343 were in the state's numerous trial courts and 24 in the appellate courts. They are in addition to 74 positions eliminated at the Office of Court Administration earlier this month.  The new layoffs represent 2.4 percent of the courts' 15,326 employees. But 1,928 law clerks, confidential secretaries and other personnel who work directly for individual judges were exempt from the cuts, meaning that 2.7 percent of the remaining workers lost their jobs.  Administrators also are eliminating the jobs of 67 full- and part-time court attendants, contract employees who provide security services in the upstate Third, Fourth, Sixth and Eighth Judicial districts.  In addition to the lost positions, the new cutbacks will set off a round of "bumping" and reassignments as hundreds of workers in targeted positions replace those with less seniority in other jobs and courts.

New York's far-flung courts handle 4.6 million new filings each year, ranging from parking tickets to murder charges. Chief Judge Jonathan Lippman, Chief Administrative Judge Ann Pfau and other officials have suggested that the cuts no doubt will mean delays in court functions such as arraignments, obtaining court orders and trials.  "The most urgent matters, such as issuing orders of protection and things like that, they will be as unaffected as possible," Judge Pfau said in an interview. "But delays are inevitable. We are going to monitor this constantly to see what is happening as far as things are getting out. We will be watching this on a day-by-day basis to make adjustments along the way. But these are real people who did their jobs very professionally and they will not be there to do their jobs anymore."  The impact will be all the greater because the courts are still digesting the departure last November of some 1,550 in an early retirement incentive program. Administrators had planned to fill more than half of those vacancies, but froze hiring earlier this year before the process was complete as the budget outlook darkened in Albany.  "New York's position as a global financial center is put at risk if we don't sufficiently fund our court system," said Robert Giuffra Jr. a partner at Sullivan & Cromwell.  Steven R. Schlesinger of Jaspan Schlesinger in Garden City, who is in the courts at least four days a week, said the layoffs are "a major topic of discussion" among attorneys. "Everyone is nervous about the layoffs," he said.

Noting he has a Delaware office and 10 to 15 percent of his cases involve clients with Delaware-based incorporations, Mr. Schlesinger said that he might decide to take future cases to Delaware if matters in New York take longer to resolve.  With large sums hanging in the balance, with a case possibly taking three to four years in New York versus a year in Delaware, "it may be malpractice for me to file in New York," he said.  According to administrators, with the layoffs, the courts will have 1,151 fewer workers than they did in August 2010.  Lou Guariello, a clerk in the commercial division of the courts in Manhattan, said the mood was somber yesterday before employees learned who would lose their jobs.  "People are kind of quiet, waiting for what's going to come down," he said in an interview. "It's that kind of a day."  "It was highly emotional today," an employee of the Nassau County Surrogate's Court agreed in an interview. "You heard of people's mortgages, tuition and fear of the future, and how they truly enjoy working for the court system."  Sally Donahue, a court-attorney referee in the Nassau Surrogate's Court, is losing the job she has held for 4 1/2 years. She said the loss of two of her unit's six positions would mean more work for an already overloaded staff.  "They're really ripping into this law department," she said.  Judge Lippman said in a statement that the cuts are "painful but unavoidable."

"After four decades in the courts, I very much view our employees as part of a court system family that is close-knit and supportive of each other in every conceivable way," he said. "My heart goes out to every one of the valued employees and their own families who will be experiencing real hardship and pain as a result of today's layoffs. I know that all judges and court personnel share my feelings, but I also know that we will all continue to do everything in our power to fulfill our constitutional responsibilities and to provide the highest quality of service to the public."  He concluded, "The doors of our courts will remain open and accessible to all. I am confident that we will overcome the difficult challenges that lie ahead of us and emerge from this trying period stronger than ever."  In designing the cuts, officials said they took into account existing vacancies and stresses in particular courts and regions around the state. The impact of cutbacks on attorneys, litigants and the public are likely to vary from court to court.  For example, Nassau County will sustain a net loss of 30 jobs, but neighboring Suffolk County will lose only 13.  Suffolk courts, which now have about 1,000 employees, were already "hit hard" by last year's early retirement program, said Administrative Judge C. Randall Hinrichs. The county lost about 135 employees to retirement and already had 100 vacancies before the new cutbacks.  Judge Hinrichs said the latest cuts had been a "difficult process," adding that "all the people we're losing are very good people, outstanding people. …Our intention going forward is to do everything possible to fulfill our obligations and make the courts work as efficiently as possible under the circumstances going forward."  Nassau Administrative Judge Anthony Marano said in a statement that he was "deeply saddened" by the layoffs and warned that "longer wait times in the adjudication of certain matters may become a reality."  In the appellate courts, 10 of the 24 job losses are in the Appellate Division, First Department. Last December, the department filled 44 of the 46 positions left vacant by early retirements.  As a result, the department needed a year-end cash infusion from the Second Department, which had filled fewer of its vacancies (NYLJ, April 13). The Second Department is losing six positions in the current round of cuts.

'Horrible Domino Effect'

Although the ultimate effect of the coming layoffs on the general public remains unclear, it is certain that 367 more people will lose their jobs. However, many of those laid off will not be the same employees who now hold the jobs being left vacant. Under union contracts and Civil Service rules, employees facing layoffs often have the right to bump workers with less seniority. Officials estimate that 241 workers will be reassigned to other jobs and/or to other courts at lower pay as a result of the cutbacks. One clerk at 60 Centre St. in Manhattan said that many of his colleagues had been "rolled back to their prior positions" such as secretary, data entry clerk and court analyst.  "The clerks are the backbone of the system," he said.  Marc Ialenti of Ialenti & Macari in Mineola noted that the processing of court matters has slowed in Nassau County since the beginning of the year, and the reassignment of more court personnel to unfamiliar positions would only exacerbate the problem, and feed client frustrations.  "It's a horrible domino effect," he said.  Judges Lippman and Pfau have said that the Judiciary would work with the system's 11 unions, all of which are now working without a contract, to find cost savings that could allow the rehiring of laid off workers at a future date.  Administrators have been working for months to cut overtime and non-personnel expenses. For example, they have suspended funding for virtually all judicial hearing officers; put on hold improvements to town and village courts; trimmed the sessions of small claims courts; halved the money appropriated to provide civil legal services for the indigent; stopped buying lunches for jurors; and decreed that court sessions must end by 4:30 p.m. each day.  But none of the economies recovered enough to reach the bottom line mandated by Mr. Cuomo and the Legislature in a budget that is dominated by personnel costs.  Employees losing their positions, in general, will qualify for 46 weeks of unemployment insurance payments and also unused vacation and sick time. They will also gain priority status on a list of dismissed workers to be rehired within the next two years, if the courts can afford to.  The last time court employees faced layoffs was in late 1991 and early 1992. About 500 workers lost their jobs in a budget dispute between then-chief judge Sol Wachtler and former governor Mario M. Cuomo, Andrew Cuomo's father. However, the cuts were quickly rescinded after the executive and the judicial branch settled their differences.  With state finances in disarray, a quick reversal in this year's cuts is unlikely. In fact, they may force fundamental changes in the way the courts do business.  "This appears to be a permanent downsizing," said Judge Pfau.  Joel Stashenko can be contacted at Daniel Wise, Andrew Keshner and Brendan Pierson contributed to this story.

CLICK HERE TO SEE RELATED STORY, "NY Post EDITORIAL: Lippman's Secret Ambition to Run Luxury Hotel"

Cops Will Monitor Courts for Ticket-Fixers

New Police Unit Will Monitor City Courts for Ticket-Fixing
The New York Times by Joseph Goldstein - May 18, 2011

Investigators from the Internal Affairs Bureau will be assigned to monitor the city’s traffic courts in an effort to determine whether police officers are intentionally losing cases as favors to colleagues, police officials said Wednesday. The formation of this unit, the Court Monitoring Unit, is the latest step by the Police Department to address concerns that a pervasive culture of ticket-fixing exists within the department. An investigation by the office of the Bronx district attorney has found evidence that police officers sometimes ask their union delegates to help get rid of traffic tickets received by friends or relatives. Various methods for fixing a ticket emerged in wiretapped conversations. In one situation, a union delegate would try to find an officer in the precinct who was willing to pull the ticket from the summons box. The department tried to end that practice last summer, when it began electronically scanning each summons to identify those that disappeared after being issued. Police officers can also make a ticket disappear by encouraging the officer who wrote it to throw the case once it goes to court, according to interviews with people following the Bronx grand jury investigation. An officer can do that by failing to show up, by altering testimony or by claiming forgetfulness. Speaking at a City Council hearing on Wednesday, Police Commissioner Raymond W. Kelly said he was forming the new unit “in response to disturbing indications that some police officers failed to appear or otherwise willfully undermined a case in court.” Investigators from the new unit will therefore spend some of their time in courtrooms observing cases, said the Police Department’s chief spokesman, Paul J. Browne. He said investigators would look for instances in which officers did not show up or an officer’s testimony raised questions. “If the original incident says one thing, and now a different account is given in court, you’ll have I.A.B. investigating why,” Mr. Browne said. The existence of the grand jury investigation into ticket-fixing has set officers on edge in the Bronx Traffic Violations Bureau, as traffic court is called. “They’re much more nervous about everything than they were before,” said a lawyer practicing in the traffic courts who insisted on anonymity. “They don’t know if they’re being observed, and they’re much more careful.”

Justice in Dreamland

Justice in Dreamland
The New York Times by Linda Greenhouse  -  May 18, 2011

Police officers following a suspect into an apartment complex in Lexington, Ky., don’t know which apartment their man has entered. But wafting through one of the closed apartment doors is the familiar odor of marijuana. The smell provides reason to believe criminal activity is afoot, probable cause for a warrant to search the apartment.  Do the police stake out the apartment and go for a warrant? No, they do not. Instead, they bang on the door, shouting, “Police, police, police.” No response — at least, no verbal response. From behind the door the officers hear the sound of “people inside moving” and objects “being moved.” Aha! Evidence may be about to be destroyed. Announcing that they are coming in, the officers kick in the door and find not the man they were looking for, but three other people, one of whom is smoking marijuana. More marijuana, along with cocaine, is in plain view.  I don’t know about other people, but I have never found an uninvited encounter with the police to be a source of comfort.  The Fourth Amendment, of course, generally prohibits searches, especially searches of the home, that have not been authorized by a warrant. But like everything else, there are exceptions. The question for the Supreme Court in a case decided on Monday was whether the police behavior in this case, Kentucky v. King, came within a recognized exception to the warrant requirement, the “exigent circumstance” created by the likely imminent destruction of criminal evidence.  The Supreme Court of Kentucky, hardly the most radical of courts in hardly the blue-est of states, applied its understanding of the Fourth Amendment and said no. If instead of pounding on the door, the state court noted, the police had quietly gone to a magistrate and obtained a search warrant, the people in the apartment would have had no reason to start scurrying around destroying their valuable contraband. Because the police themselves had prompted that response, foreseeably creating the “exigent circumstance,” the court concluded that the state should not be allowed to reap the benefit.

The United States Supreme Court reversed. The vote was 8 to 1. Hello? Is anyone home? (And I don’t mean Justice Ruth Bader Ginsburg, the lone dissenter.) Fourth Amendment law is enormously complex (although not as complex as it once was, now that the state wins almost all the cases) and I make no pretense here of unpacking it wholesale. Nor do I argue that this case was the most important on the court’s docket; even accepting Justice Ginsburg’s conclusion that the police could easily have obtained a warrant and that the majority had gratuitously used the case “to contract the Fourth Amendment’s dominion,” the criminal justice system has hardly been shaken to its core. But in fact, its very ordinariness is what makes this decision worth pondering. It’s worth stopping to consider the assumptions about human nature that underlie not only this ruling but much of the court’s Fourth Amendment jurisprudence. It’s worth wondering what planet the justices — most of them, anyway, and not just the incumbents, but many of their predecessors — have been living on when it comes to encounters between the police and the rest of us. What the court held, in an opinion by Justice Samuel A. Alito Jr., is that warrantless entry to prevent the destruction of evidence is justified as long as the police “did not create the exigency by engaging or threatening to engage in conduct that violates the Fourth Amendment.”  Here, according to the court, all the police did was knock on the door, something that is “no more than any private citizen might do.” (But didn’t the police break the door down and barge in — hardly something one would expect to follow a neighborly knock? Well, yes, but that was after the “exigency” arose, after they heard the scurrying.)  According to Justice Alito, “Whether the person who knocks on the door and requests the opportunity to speak is a police officer or a private citizen, the occupant has no obligation to open the door or to speak.” In other words, the occupants of the apartment not only had a right to tell the police to go away, they almost had a constitutional obligation to do so, because “occupants who choose not to stand on their constitutional rights but instead elect to attempt to destroy evidence have only themselves to blame for the warrantless exigent-circumstances search that may ensue.”  “Only themselves to blame.” But wait, there’s more. It turns out that the occupants of this apartment were not only woefully unsophisticated about the Fourth Amendment, they were also ingrates: “Citizens who are startled by an unexpected knock on the door or by the sight of unknown persons in plain clothes on their doorstep may be relieved to learn that these persons are police officers. Others may appreciate the opportunity to make an informed decision about whether to answer the door to the police.”  An opportunity to ask the officers to “hold it right there while I consult my attorney?” Let’s get real.  I don’t know about other people, but I have never found an uninvited encounter with the police to be a source of comfort. Once, driving through a quiet residential neighborhood in Washington on the way home from a theater performance, my husband and I were unaccountably pulled over by a police officer in a squad car. The officer asked my husband (a lawyer) for his license and registration. Did he comply? Of course. It occurred to neither of us to say: “Officer, I invoke the Fourth Amendment and request that you articulate the suspicion that has caused you to pull us over.” We had not been drinking or using drugs, we had nothing to hide, and we had broken no law. But the incident was nonetheless unnerving, and my blood pressure goes up as I recall it years later.

The Supreme Court’s fantasy world of consensual and constitutionally informed encounters with the police is nothing new. In a 1984 decision, Immigration and Naturalization Service v. Delgado, a case arguably even more relevant today than it was before the immigration crackdown of the later 1980’s and since, the court rejected a Fourth Amendment challenge to immigration sweeps of factories and other workplaces. There was no problem, the court held, because the workers surrounded by immigration agents were not “seized.” They were free to leave the premises, and those who chose to remain participated in nothing more than a “classic consensual encounter.”

In 1991, the court upheld a police technique known as “working the buses,” in which officers would board long-distance buses and request passengers’ permission to conduct a pat-down search. The Florida Supreme Court had found these searches to violate the Fourth Amendment because passengers approached by uniformed police officers in the confines of a bus would not feel “free to leave.” But in Florida v. Bostick, the Supreme Court disagreed, suggesting that to the contrary, a “reasonable person,” advised that he was free to say no, would indeed “feel free to decline the officers’ requests or otherwise terminate the encounter.”  Eleven years later, in United States v. Drayton, the court dispensed with the premise that passengers needed to be informed of their right to say no. That 5-to-4 decision reinstated the convictions of two men who, submitting to a pat-down while on a Greyhound bus, were found to be carrying cocaine taped to their thighs.  There was nothing intimidating about the circumstances of the encounter, Justice Anthony M. Kennedy wrote for the majority, “no overwhelming show of force, no brandishing of weapons, no blocking of exits, no threat, no command, not even an authoritative tone of voice.” Justice Kennedy said it didn’t matter that the passengers were not explicitly informed that they did not have to cooperate. People typically go along with these searches, he asserted, “not because of coercion but because the passengers know that their participation enhances their own safety and the safety of those around them.”  Justice David H. Souter, in dissent, objected that the majority opinion had an “air of unreality.” Indeed.  But let’s look on the bright side. The Supreme Court tells us that if we don’t know our constitutional rights, we have only ourselves to blame. Knowledge of the Constitution, along with other basic elements of civics, is at pathetically low levels: only a quarter of high school seniors — people old enough to vote, or nearly so — demonstrated proficiency in a recent national survey of students’ knowledge of how government works.  So perhaps this week’s decision could be harnessed to provide the motivation evidently missing from the classroom. Students could be instructed that if the police come pounding on their door, and they don’t know enough to stand on their Fourth Amendment rights, they have only themselves to blame.

Wednesday, May 18, 2011

Federal Judge Angry in Corruption Case Involving Political Cronies

Angry judge delays Annabi, Jereis corruption trial until 2012
The Journal News by Jonathan Bandler  -  May 17, 2011

An angry federal judge lashed out at prosecutors Tuesday as she was forced to delay next month's start of a Yonkers corruption trial until next year.  The trial of former Yonkers Councilwoman Sandy Annabi and her cousin, former city Republican chairman Zehy Jereis, on bribery, conspiracy and other charges was to have started June 20. But a new grand jury indictment against the pair obtained yesterday by the U.S. Attorney's Office forced the change because Annabi's lawyer, William Aronwald, had an overseas trip planned for the coming weeks and would not have enough time to review the new charges.  U.S. District Judge Colleen McMahon blamed the assistant U.S. attorneys, Jason Halperin and Perry Carbone, for the late charges, particularly because they mostly mirror the original ones and could have been brought months ago, she argued.  "This looks like a sandbag. I don't blame Mr. Aronwald for feeling sandbagged," McMahon told Halperin, adding later, "I have a great deal of respect for you. But this stinks. It smells."  Annabi, Jereis and politically connected lawyer Anthony Mangone were first charged in January 2010 following a four-year federal probe into the City Council's approval of the $660 million Ridge Hill project — for which Annabi changed her vote after initially opposing the development.   Mangone pleaded guilty in November, admitting that he gave Jereis thousands of dollars to pass along to Annabi so that she would change her vote on another development, the so-called Longfellow School project, which was never built.  Halperin said the new indictment does not change the prosecution's theory of the case. But Aronwald said the "allegations are substantially changed" because they extend by two years the period of time when the alleged conspiracy between Annabi and Jereis was ongoing.  The prosecution contends that Jereis effectively had Annabi on retainer, plying her with more than $160,000 over the years, in the hope that when needed she would do his bidding — and that she did so on the Ridge Hill and Longfellow votes. But the defense has complained that the retainer reference was a late addition by prosecutors once the defense had impressed upon them that the relationship between Annabi and Jereis was always a social one and never political; a distinction that could be significant in considering whether the money given Annabi could be construed as a bribe.   McMahon said the trial would have to be postponed at least until early next year because she has several trials scheduled through December.  Halperin said it was never the prosecutors' intention to disrespect the court or "sandbag" the defense. Jereis' lawyer, Anthony Siano, would not comment, other than to say "Mr. Jereis intends to vigorously defend this case."

Blog Archive

See Video of Senator John L. Sampson's 1st Hearing on Court 'Ethics' Corruption

The first hearing, held in Albany on June 8, 2009 hearing is on two videos:

               Video of 1st Hearing on Court 'Ethics' Corruption
               The June 8, 2009 hearing is on two videos:
               CLICK HERE TO SEE Part 1
               CLICK HERE TO SEE Part 2
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