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Thursday, July 22, 2010

Source Reveals Senator John Sampson Quietly Directing Feds in NY Corruption Fight

BREAKING NEWS: New York Corrupt Insiders targeted John Sampson a while ago ..... determined to discredit him and disbar him from the practice of law ..... Sampson has been working with federal prosecutors 24/7 .... it's going to get ugly .... but corruption by New York State insider thugs will soon see some exciting changes.... more soon.....


Senate Leader Did Legal Work for Broker With Ties to Loan Scandal
The New York Times by DANNY HAKIM - July 20, 2010

NY Senate Leader Tied to Figure in Loan Scandal

ALBANY, NY — John L. Sampson, the State Senate leader, performed legal work for a Queens real estate broker who was being investigated by state authorities on allegations of fraud and predatory lending, and was disciplined for acting as a notary for the broker after his notary license had expired, according to state documents. The broker, Edul Ahmad, has been at the center of a loan scandal involving United States Representative Gregory W. Meeks of Queens, who this month admitted that he had failed to disclose a $40,000 loan from Mr. Ahmad on his federal filings. The loan appeared to come with no strings attached, or interest. Mr. Meeks repaid it three years after the fact, once it became a matter of scrutiny. The generous terms of the loan have raised questions about Mr. Ahmad and his political relationships. New details about Mr. Ahmad’s past emerged after The New York Times submitted a Freedom of Information Act request to the New York Department of State, which investigates improprieties by licensed real estate brokers. Mr. Ahmad has been the defendant in five cases investigated by the department involving allegations of fraud and predatory lending. Mr. Ahmad was fined $750 in one case and had his license suspended for 30 days in another one. Two other cases, initiated in 2007 and 2008, were referred to the office of the Queens district attorney, Richard A. Brown, but a spokeswoman for Mr. Brown’s office said Tuesday night that it could not immediately determine what became of the referrals.

Mr. Sampson, the highest-ranking official in the Senate, is described in the documents as having performed a variety of legal work, from meeting with an investigator from the Department of State about documents being collected from Mr. Ahmad to notarizing an affidavit of a former employee of Mr. Ahmad’s. The work took place through 2008, before Mr. Sampson became leader of the Democratic caucus in the summer of 2009, but he continues to act as a lawyer for Mr. Ahmad. While there is no prohibition against a lawmaker representing a client who is the subject of a state investigation, Dick Dadey, executive director of Citizens Union, a government watchdog group, expressed concern that a state official was performing legal work in a matter involving a state agency. “It’s baffling,” Mr. Dadey said. “It creates a potential conflict because he’s a representative of the state representing someone before the state.” “It’s made all the more problematic because of the questions surrounding the relationship with Congressman Meeks,” he said. “It becomes a web of several conflicts.” Mr. Sampson’s notary work on behalf of Mr. Ahmad got Mr. Sampson into trouble because his notary license had expired; notarizing a document without a valid license is technically a misdemeanor under state law. That led the Department of State to conduct an investigation in 2008 into Mr. Sampson’s conduct. According to documents related to the inquiry, Mr. Sampson told investigators that he was unaware his license had expired and said that his staff had sent in a renewal form but that it had been returned because it was incomplete. Mr. Sampson surrendered his license and was not allowed to reapply for a year.

Mr. Sampson said through a spokesman, Austin Shafran, that he had acted as a lawyer for Mr. Ahmad only on commercial transactions and while the Department of State was in an investigative phase. Mr. Shafran added that another lawyer at the firm where Mr. Sampson works handled any administrative proceedings before state officials. Mr. Shafran called the notary issue “a clerical matter that has been resolved administratively.” Mr. Ahmad, he said, is “a longtime friend and supporter” of Mr. Sampson’s. “They first met at a fund-raiser for Senator Sampson’s first campaign in 1996.” Both men are of Guyanese descent, and Mr. Sampson once tried to help a sister of Mr. Ahmad’s obtain a temporary visa to get medical treatment in the United States. Mr. Ahmad has also donated $6,000 to Mr. Sampson’s campaign. In a brief telephone interview, Mr. Ahmad was evasive about his relationship with Senator Sampson, at first saying he had never paid the senator and that he had never acted as his lawyer. “Senator Sampson is a friend of mine, that’s all he is,” he said. When it was pointed out that Mr. Sampson is recorded in Department of State documents as having performed a variety of legal work on his behalf, Mr. Ahmad said: “I usually seek legal advice on many occasions. John is an attorney.” State records lay out a variety of allegations against Mr. Ahmad. In one case he was accused of having one of his sales agents pose as a buyer so that Mr. Ahmad himself could purchase a property at a low price, unbeknownst to his client, the seller. In another case, a couple who bought a home and used Mr. Ahmad as an agent claimed that their signatures were forged on a number of documents, leaving them with monthly payments far higher than they could afford. Investigators were also told by Mr. Ahmad that a number of his records had been destroyed in a fire. In the phone interview, Mr. Ahmad said he had done nothing improper. Ray Rivera contributed reporting.

Tuesday, July 20, 2010

U.S. Supreme Court Makes Public Corruption Easier

Supreme Court ruling raises bar for corruption, fraud prosecutions
The Washington Post by Spencer S. Hsu - July 18, 2010

A Supreme Court ruling last month that gutted an anti-corruption tool favored by federal prosecutors is jeopardizing high-profile investigations into politicians and business executives, including several related to convicted ex-lobbyist Jack Abramoff, according to legal experts and new court filings. Since the June 24 decision, U.S. District Judge Ellen Huvelle in Washington has delayed sentencing for one close Abramoff associate, Michael Scanlon, and ordered the government to explain why the court should not dismiss several charges against another, Kevin Ring. Legal experts predict a flood of similar litigation by defense lawyers based on the Supreme Court ruling. The court ruled unanimously that a 1988 federal statute that makes it a crime to "deprive another of the intangible right of honest services" is unconstitutionally vague. The justices limited the law's application to bribes and kickbacks, which several former prosecutors say will make corruption convictions against members of Congress more difficult. "I am worried about whether there is sufficient evidence to sustain an indictment with the new definition of bribery/materiality," Huvelle told lawyers at a July 6 hearing in advance of Ring's trial, scheduled for next month. She asked both sides to file briefs assessing the recent decision. In their June decision, the justices directed lower courts to reconsider the honest-services fraud convictions of former Enron executive Jeffrey K. Skilling, another business leader and a former state lawmaker. Elsewhere, attorneys for former Illinois governor Rod Blagojevich (D) moved unsuccessfully to delay his trial in Chicago, where he faces charges of honest-services fraud, racketeering, attempted extortion, bribery and conspiracy. Attorneys for former U.S. representative William J. Jefferson (D-La.) may raise the matter in the appeal of his 2009 conviction and 13-year prison sentence for crimes including soliciting bribes, money laundering and racketeering.

"We don't know how many cases may be affected, but this is one of the most-used tools in public corruption investigations," said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington. Public interest groups say Congress should tighten federal corruption laws, citing court decisions since 2007 that narrowed the types of "official actions" that public servants are barred from performing for people who give them money or gifts. Those rulings also require that prosecutors show more specifically that illegal actions were done in return for money. "All these things are combining to really give members of Congress . . . much less to fear from watchdogs than 10 years ago," Sloan said.

Legal experts say the effect of the Skilling decision will vary case by case. Prosecutors increasingly turned to honest-services fraud charges in recent years to target patterns of self-dealing and conflicts of interest by government and corporate officials, even without a direct quid pro quo. Critics said that the law was so vague that it could apply to a government employee skipping work to see a ballgame and that it gave prosecutors too much discretion over whom to charge. Jefferson and Blagojevich may find it hard to benefit from the situation, because their cases include allegations of bribery, and in Blagojevich's case, prosecutors obtained a new indictment with other charges, anticipating the Supreme Court's decision. Abramoff-related cases present some examples of how the high court's decision might be applied. Abramoff is in a halfway house finishing a four-year term after he pleaded guilty to running a wide-ranging fraud and public corruption scheme. The former powerhouse Washington lobbyist admitted dishing out campaign donations, tickets to sporting events, lavish trips and expensive meals to public officials who helped his clients with federal funds, inside information and legislative favors. At least 19 lawmakers, Capitol Hill aides and government officials have been convicted. Still under scrutiny is former House majority leader Tom DeLay (R-Tex.). Scanlon, a former DeLay aide and public relations executive, is seeking to renegotiate the terms of his 2005 plea deal with prosecutors. Scanlon pleaded guilty to a single count of conspiracy, and he admitted kicking back to Abramoff half of the exorbitant fees he charged Native American tribes after Abramoff recommended Scanlon's firm to them. Scanlon's attorneys say his agreement to serve up to five years and repay the tribes as much as $20 million was driven by the honest-services law. The government did not oppose delaying his sentencing 60 days, until Oct. 4. But federal prosecutors have said that the high court decision should have no effect on the case against Ring because bribery is a central component. The former lobbyist and congressional aide allegedly helped Abramoff arrange campaign contributions to then-Rep. John T. Doolittle, lied about his knowledge of a lucrative job arranged by lobbyists for Doolittle's wife, Julie, and treated Doolittle's staff to rock concerts, football games and fancy meals. Attorneys for Ring, who have said he is not guilty, argue that the case was grounded in the honest-services law, and they have asked Huvelle to dismiss several counts from his first trial, which ended in a hung jury. The Doolittles say that they are innocent of wrongdoing and that authorities have told them the investigation of them is over. Justice Department spokeswoman Laura Sweeney declined to estimate how many cases are affected by the court's ruling. Staff researcher Alice Crites contributed to this report.

Friday, July 16, 2010

First Department Says, "Do As We Say, Not As We Do"

Local Law Firm Could Be Back on the Hook for Claims It Aided $22 Million Ponzi Scheme
The New York Law Journal by Nate Raymond - July 7, 2010

A state appellate court yesterday reinstated aiding and abetting charges against a New Jersey law firm in a suit by investors over its alleged role in a $22 million Ponzi scheme. Justice Sallie Manzanet-Daniels, writing for a unanimous panel of the Appellate Division, First Department, said that the court "cannot and will not endorse what is essentially a 'see no evil, hear no evil' approach." "If the facts and circumstances herein do not support an inference of actual knowledge, then it is doubtful that any action for aiding-and-abetting fraud could be sustained by an attorney, who, like the defendant attorneys, consciously chose to look the other way when their clients asked them to prepare the [offering memoranda] for their next 'investment' vehicle," Justice Manzanet-Daniels wrote in Oster v. Kirschner, 602081/2007. Supreme Court Justice Charles Ramos in 2008 granted Lum, Drasco & Positan's motion to dismiss the charges brought by investors who claimed the lawyers knew about the undisclosed criminal histories of the perpetrators of the scheme prior to its unravelling. The firm was sued under a previous name, Lum, Danzis, Drasco & Positan. But Justice Manzanet-Daniels reversed, saying the investors had adequately alleged the lawyers had actual knowledge of the underlying fraud. Donald Chase, a partner at Morrison Cohen who represents the two investors who brought the case, praised the decision as "fantastic" in holding that lawyers could be pursued for aiding and abetting in fraud. "The notion that lawyers are somehow protected when their clients do fraud was, I think, an important notion for this court to dismiss," Mr. Chase said. "And I'm happy that they did so." Neither William E. Goydan, a lawyer for Lum Drasco at Wolff & Samson, nor Anne P. Richter, a lawyer for Lum Drasco of counsel and defendant Philip L. Chapman at McManus, Collura & Richter, responded to requests for comment. Investors Avi and Ann Oster sued Lum Drasco and others in 2007 after losing the $1.9 million they had invested in Cobalt Multifamily Investors I, LLC, a purported real estate investment company. The company, which was actually a Ponzi scheme, went into receivership after its principal backers were indicted on federal securities fraud charges in March 2006. In their complaint, the Osters alleged that they invested their money in Cobalt in reliance on private offering memoranda drafted by Roseland, N.J.-based Lum Drasco and Mr. Chapman that contained misrepresentations and omissions. The memoranda misrepresented who was investing in Cobalt, with units of Cobalt being sold to people who did not meet the investor criteria, the complaint said. The memoranda also misrepresented Cobalt's management team, according to the complaint. The documents said William B. Foster ran Cobalt on a day-to-day basis and Mark Shapiro was a "consultant." But Mr. Shapiro, a convicted felon, ran Cobalt with the help of Irving J. Stitsky, who had been convicted for numerous securities violations and was banned from the industry, the complaint said. The placement memoranda did not disclose the extensive criminal histories of Mr. Shapiro and Mr. Stitsky dating to 1998. After the FBI raided Cobalt's offices in December 2005, the complaint alleges that a backdated amendment that claimed to reveal Mr. Shapiro's and Mr. Stitsky's criminal past was drafted for the December 2004 memoranda. The Osters claimed that Lum Drasco, which drafted three versions of the private placement memoranda, had actual knowledge of and assisted in the Cobalt fraud. As escrow agent, Lum Drasco received documents about the suitability of potential investors. And it knew about the criminal histories of the management, the complaint claimed. Lum Drasco countered that any misrepresentations in the memoranda were irrelevant to whether the lawyers knew Cobalt was a Ponzi scheme. The firm did not seriously dispute its lawyers knew about the backgrounds of Mr. Stitsky and Mr. Shapiro, who was revealed in a related Securities and Exchange Commission case to have hired Lum Drasco. But the law firm argued its knowledge of their backgrounds and misrepresentations in the memoranda was not enough to allege "actual knowledge" of the Ponzi scheme. In April 2008, Justice Ramos dismissed the charges against Lum Drasco and another law firm, Certilman Balin Adler & Hyman, finding arguments that the firm as escrow agent had a duty to investigate and disclose the frauds to the Osters were "unavailing" and "illogical."

'Narrow Formulation'

In reversing, the First Department rejected what Justice Manzanet-Daniels called a "narrow formulation of the pleading requirements for fraud." Actual knowledge of the fraud only needs to be pleaded generally, she wrote, particularly before discovery has commenced when plaintiffs lack the materials needed to reveal a defendant's state of mind. "Participants in a fraud do not affirmatively declare to the world that they are engaged in the perpetration of a fraud," she wrote. In this case, the Osters had adequately alleged actual knowledge and that the Lum firm had provided substantial assistance, the court said. Lum Drasco pointed to two prior cases where attorneys represented parties in deals that were only later revealed as frauds. But investments in Cobalt, Justice Manzanet-Daniels wrote, "were from their inception objectionable" since they were offered to investors who did not meet the criteria and because of the criminal histories of those running the company. The Appellate Division decision contrasts with a September 2009 federal decision by Eastern District Judge Raymond Dearie in which he dismissed claims against Lum Drasco and other Cobalt lawyers. Justice Manzanet-Daniels in a footnote noted that in the federal case the investors had not alleged the lawyers had actual knowledge of the fraud. "To the extent the federal court took a narrow view of the 'actual knowledge' requirement under New York law, we respectfully disagree with the decision," Justice Manzanet-Daniels wrote. Joining the decision were Justices Luis A. Gonzalez, Richard T. Andrias, David B. Saxe and Dianne T. Renwick. Messrs. Shaprio, Stitsky and William B. Foster were found guilty in 2009 after a three-week jury trial on securities fraud, wire fraud, mail fraud and conspiracy charges.

Thursday, July 15, 2010

New York Judge Stands Up To Corrupt Banks

Quiet Judge Facing a Foreclosure Crush Gets Lenders Attention
The New York Law Journal by Mark Fass - July 15, 2010

At first blush, Suffolk County Acting Supreme Court Justice Jeffrey Arlen Spinner (See Profile) seems an unlikely figure to strike fear in attorneys. The 50-year-old judge is physically unimposing, speaks in soft, measured tones and is unfailingly polite. He habitually refers to the attorneys who appear before him as "nice," "reasonable" and even "wonderful" people. But the 12-year veteran of the Suffolk bench has also issued three foreclosure decisions over the past eight months that have made him the darling of the tabloids and the Internet for, as the New York Post put it, sticking it to "ruthless bankers." First, in November, the judge canceled a $292,500 mortgage because of what he called IndyMac Bank's "unconscionable, vexatious and opprobrious" conduct during mandatory loan-modification negotiations (IndyMac Bank v. Yano-Horoski, 2005-17926, NYLJ, Nov. 23, 2009). In March, he ordered Wells Fargo to pay a homeowner $155,000 for entering his house without his permission and changing the locks (Wells Fargo v. Tyson, 2007-28042, NYLJ, March 15). And then in April, the judge ordered Emigrant Mortgage to pay a couple $100,000 as damages for what he said was an "unconscionable, unreasonable [and] overreaching" mortgage agreement. (Emigrant Mortgage Co. v. Corcione, 2009-28917, NYLJ, April 21). Those three decisions have gotten the attention of not only the press and hopeful homeowners, but also of banks and their attorneys. One sign that the banks now tread carefully in Justice Spinner's Riverhead courtroom is the number of veteran bank attorneys who appear at the mandatory settlement conferences. On a recent Tuesday morning, Jonathan Ullman, a Syosset attorney who has represented banks for more than 19 years, was among the half-dozen lawyers who had come to conferences being held in the aisles, the hallway or nearby offices. Now that Justice Spinner has gained the lenders' attention, Mr. Ullman said, banks no longer entrust cases before him to junior associates: The possibility of losing, and losing big, has become too real. "The banks are scared to death of Judge Spinner," Mr. Ullman said. "If you go to the rest of the parts, you won't see anything like this."

Rising Tide of Foreclosures

Over the last five years, the annual number of foreclosure filings in New York state has more than doubled, from 22,350 in 2005 to 46,673 last year. More cases were filed in the first five months of 2010 than in all of 2005. In Justice Spinner's county, the increase has been even steeper, to 7,536 filings last year from only 2,016 in 2005. And the county had recorded 4,144 foreclosure filings as of May 24.

As that tide has risen, several Supreme Court judges have developed reputations for discarding the rubber stamp to which many banks had become accustomed. Brooklyn's Justice Arthur Schack is known for rejecting foreclosure petitions because of shoddy or questionable paperwork by the mortgagees (NYLJ, Dec. 24, 2009). Justice Timothy J. Walker of Buffalo recently dismissed a foreclosure action after Wells Fargo insisted on including an adjustable-rate clause in its loan modification, despite the wide-spread criticism of adjustable rates and the judge's previous order requiring the bank to offer a loan without such a clause. (Wells Fargo v. Hughes, 2010-20081). And in Suffolk County, which is home to one-fourteenth of the state's population but one-sixth of its new foreclosures, Justice Spinner has gained a small measure of celebrity within the ever-expanding foreclosure community. The judge's decisions have been covered everywhere from Reuters ("Hero of the day: Jeffrey Spinner") to the blog 4closureFraud ("Another NY Style beat down") to London's Daily Mail ("Couple's £370,000 mortgage wiped out by judge angry at bank's 'repulsive' behaviour"). As the presiding judge of the Residential Mortgage Foreclosure Conference Part for the past 18 months, Justice Spinner has overseen Suffolk County's efforts to process the onslaught of foreclosures by implementing new court procedures and managing the mandatory settlement negotiations for subprime mortgages. The boy who would soon be named Jeffrey Arlen Spinner was born inside of a 76th Street apartment, on the Upper East Side of Manhattan, in 1959. Six days later he was adopted by a Long Island couple, hand surgeon Morton Spinner and his wife, Paula, an elementary school teacher. The Spinners had two more boys, and the family moved to Connecticut when Jeffrey was 12. After graduating from Ithaca College in 1981 and the Touro Law Center in 1987, the future judge built his mortgage expertise, as he put it in a recent interview, "from the ground up"—by working at a series of small Long Island and Connecticut law firms as, of all things, a bank attorney. "That's where the jobs became available at that time," Justice Spinner said. "It wasn't a conscious choice." He handled 40 closings a week, doing title searches the old-fashioned way: going from clerk's office to clerk's office and pulling the records. His wife, Alyse Auerbach Spinner, gave birth to the first of the couple's three daughters, now ages 14 to 21, in 1989. She now serves as the administrator of the Jacob's Light Foundation, a charity that provides "necessities and comforts from home" to soldiers overseas. A registered Conservative, the judge was appointed to Suffolk County District Court in January 1998, elected to the County Court in November 1998 and assigned to the Supreme Court in January 2006. After the Legislature established mandatory settlement conferences for subprime loans in 2008, Suffolk County's Administrative Judge H. Patrick Leis (See Profile) appointed Justice Spinner to preside over the county's new foreclosure conference part. A second judge, Family Court Judge Patrick Sweeney (See Profile), was later added to the part to help manage the backlog. After the Legislature last year required good-faith settlement conferences in all foreclosure actions, the Suffolk County case load—about 250 new cases per week—has become too vast for one or two judges to handle. Justice Spinner is now one of 32 judges hearing foreclosure cases, though he still has about 1,100 subprime conferences remaining on his calendar.

Mandatory Conferences

Justice Spinner sets aside each Tuesday for settlement negotiations. Dozens of homeowners meet with bank attorneys to hand over documents or discuss modifications. The judge personally intervenes in only the few that appear to be at an impasse. "In this part we don't do things on a one-size-fits-all basis," the judge said. "Each person has a different need. If I can tailor something where both sides give a little bit and both sides take a little bit, everyone comes out a little less unhappy. Everything we do here is about compromise." On a recent Tuesday, the cases that required the judge's attention included one that seemed to have been resolved. The judge sat down at a table in an otherwise empty office across the hall from his chambers with a court reporter, a pro se Port Jefferson homeowner, and the bank's attorney, Henry DiStefano from the Office of Steven J. Baum—a firm that handles so many foreclosures that Justice Spinner reserves one Tuesday each month for its settlement conferences. "Let's start with a personal matter," the judge said. "How did your husband's surgery turn out? Is he okay?" The parties had agreed to a so-called short sale only to have the buyer withdraw at the closing out of concerns regarding the bank named on the payoff letter, the type of procedural breakdown that never happened back in the judge's day pulling title records by hand. Hearsay problems notwithstanding, Justice Spinner encouraged the homeowner to play a voicemail from the buyer's title company over her cell phone's speakerphone. (The judge told the court reporter that she need not record the number of new messages in the woman's inbox.) After much discussion, Mr. DiStefano agreed to ask his client to produce a new letter and the judge ordered the title company to either accept the new letter or appear in his court to explain why it would not. "If they won't [accept it], they're coming in to see me," the judge said. "I won't take no for an answer."

Justice Spinner may speak in maxims—"These folks come in as people, and I'm here to serve the people"—but his three best-known decisions are rooted in legal philosophy: The Supreme Court's status as a court of equity vests it with the right and the responsibility to award damages in order to punish the defendant or deter others. "[T]his Court is persuaded that Judge Benjamin Cardozo was most assuredly correct in stating that 'The whole body of principles, whether of law or of equity, bearing on the case, becomes the reservoir drawn upon by the court in enlightening its judgment,'" Justice Spinner wrote in Emigrant, quoting the 1925 decision Susquehannah Steamship Co. v. A.O. Andersen & Co., 239 N.Y. 289. Emigrant has filed a notice of appeal, as well as a motion to rehear and reargue. Law Center Professor Leif Rubinstein, who heads the school's mortgage and foreclosure clinic, said, "The thing I'm teaching in my class is how [Justice Spinner] is taking the equity arguments and how he's using them in all of his decisions. The Court of Appeals acknowledged that the Supreme Court is a court of equity as well as a court of law. There haven't been many decisions citing that." Mr. Rubinstein predicted that the legal bases of the three decisions will be upheld on appeal (Wells Fargo has also filed a notice of appeal), though the size of the awards may be remanded for reassessment. Justice Spinner says that although the foreclosure filings continue to overwhelm the system—they presently constitute about 50 percent of the case load in Suffolk Supreme Court's civil term—the conferences are proving to be a benefit for both sides. "I can't speak for the other parts, but I've found in my part they've been successful. If nothing else, it brings people together and gets them talking," Justice Spinner said. "Banks didn't want to be bothered with it. Now that's changed, because I think the whole economic climate has changed.". Mark Fass can be reached at mfass@alm.com.

Tuesday, July 13, 2010

More Court Insiders Spill The Corrupt New York Dirt

NY Judge Suing Rival, Lawyer for $15 Million Over Alleged Election Skullduggery
The New York Law Journal by Daniel Wise - July 13, 2010

The judge who lost a 2007 Democratic primary for Brooklyn surrogate has filed an unusual lawsuit seeking $15 million from her successful rival and the winner's attorney. The defeated candidate, Civil Court Judge ShawnDya Simpson, contends that Brooklyn Surrogate Diana A. Johnson and her campaign attorney, B. Mitchell Alter, used confidential information against Judge Simpson in the surrogate campaign that Mr. Alter had gained when he represented Judge Simpson in a 2003 Civil Court race. Judge Simpson filed her lawsuit, Simpson v. Alter, 106471/09, last year. Discovery is almost complete in the case. Judge Simpson alleged in her complaint that Mr. Alter improperly disclosed to reporters, blogs and political figures the address of a house that she owns in South Orange, N.J., her mortgage, her children' schools and after-school activities and the fact that one of her children had a health problem that required the family to maintain a domicile in South Orange. She claimed in the bill of particulars to her suit that these disclosures exposed her and her family to "extreme danger" because she had been assigned to Criminal Court in Manhattan and was a prosecutor in Brooklyn for 12 years before her election to the bench. According to Judge Simpson's complaint, Surrogate Johnson "conspired with and permitted" Mr. Alter to disclose the confidential information to challenge Judge Simpson's residency during the 2007 primary. Mr. Alter in interviews denied having disclosed any client secrets, saying that all the information cited by Judge Simpson was "a matter of public knowledge during the 2003 race and was published in a Daily News article." "She is nothing but a sore loser," he added. Judge Simpson's New Jersey house was a campaign issue and "the voter's of Kings County soundly rejected her position that she was a resident of Brooklyn." Surrogate Johnson beat Judge Simpson in the 2007 surrogate primary by 19 percentage points and went on to be elected surrogate, defeating a Republican candidate by a large margin. Surrogate Johnson's lawyer, Marc Kreig, did not respond to a request for comment. Judge Simpson's lawyer, Laura M. Dilimetin, said her client brought the suit against Surrogate Johnson and Mr. Alter because they "have violated one of the most sacred tenets of the legal profession"—to preserve client confidences. Ms. Dilimetin, of Dilimetin & Dilimetin in Manhasset, declined to comment further. Judge Simpson's complaint raises seven causes of action. Three claims—breach of contract, breach of fiduciary duty and legal malpractice—are aimed solely at Mr. Alter and his firm, Alter & Barbaro. Surrogate Johnson is accused of aiding and abetting the lawyer's misconduct and tortious interference with a contract. Both are charged with unjust enrichment and invasion of privacy. The two sides do not dispute that Mr. Alter represented Judge Simpson in a 2003 Civil Court race and her opponent, Surrogate Johnson, in 2007. They also agree that the issue of the South Orange house was raised to question the bona fides of Judge Simpson's residency in Brooklyn in both the 2003 and 2007 races. The first time the issue surfaced, Judge Simpson was being represented by Mr. Alter.

Scope of Representation

They differ, however, on the scope of the 2003 representation. Judge Simpson alleges that Mr. Alter had been retained to give her advice about establishing residency to qualify for the Civil Court race and any rules restricting where she could reside if she won. It was in that context that she gave Mr. Alter confidential, personal information, she says. Mr. Alter in an interview denied that Judge Simpson had hired him for any purpose other than to make sure that her nominating petitions met all legal requirements. "I did not advise her about residency issues," he said, "and in fact was not retained until after [Judge Simpson] had already moved to Brooklyn to establish residency. "I did not even realize she had a New Jersey address, until her opponent raised a residency challenge based upon it before the New York City Board of Elections." The city board's lack of jurisdiction was "so clear-cut," Mr. Alter said, that her opponent withdrew the challenge once Mr. Alter advised her lawyer that residency challenges can only be brought in the Supreme Court." The matter was resolved with one phone call, he said, which involved so little time, "I did not charge [Ms. Simpson] but just threw it in as a part of the package." Jerry H. Goldfeder, an expert in election law at Stroock & Stroock & Lavan, said courts are extremely liberal in construing residency requirements under the election law. "Basically," he said, "candidates, with multiple residences all of which are legitimate, can choose…the district where they want to run."

Disqualification Ruling

In 2007, Queens Supreme Court Justice Peter J. O'Donoghue rebuffed Mr. Alter's effort to use the residency issue to knock Judge Simpson off the ballot. During that litigation, Judge Simpson moved to have Mr. Alter removed as Surrogate Johnson's lawyer on the ground that he had a conflict of interest because he had represented Judge Simpson in her Civil Court campaign. Justice O'Donoghue rejected that claim, finding that two different Brooklyn apartments were at issue in the 2003 and 2007 campaigns. Judge Simpson claims it cost her $100,000 in legal fees to stay on the 2007 ballot. Judge Simpson initially filed her lawsuit in Manhattan. But Mr. Alter successfully sought to move the case to Nassau County because none of the parties resided in Manhattan and he lives in Nassau. Both Mr. Alter and Surrogate Johnson asked Nassau Justice Thomas P. Phelan to dismiss the suit under the doctrine of collateral estoppel because Justice O'Donoghue had already decided the disqualification issue. Justice Phelan, however, let the suit go forward, ruling that the disqualification claim had not been "material" to the resolution of the 2007 election law dispute. Mr. Alter, but not Surrogate Johnson, has appealed the issue to the Appellate Division, Second Department. In his Second Department brief, Mr. Alter refers to a Daily News article written during the 2007 campaign in which Judge Simpson's husband, Jacob Walthour Jr., who at the time was her campaign manager, is quoted as saying that the couple moved to New Jersey to "obtain the best healthcare for a child born with developmental challenges." In addition to the Daily News article, Mr. Alter's appellate brief points to publicly available documents in the record as supporting Surrogate Johnson's legal and campaign position in the 2007 litigation that Ms. Simpson lived in New Jersey. The documents cited in Mr. Alter's brief were an entry from a Verizon directory listing her phone number and address; an Internet post on a New Jersey middle school district's Web site, revealing that Judge Simpson had made a contribution to the school's PTA; and a deed listing Judge Simpson and Mr. Walthour as the co-owners of the South Orange home.

Friday, July 9, 2010

The Crimes Against Families Start Seeing Justice

Ex-Counsel to Public Administrator in Bronx Faces Excessive Fee Charges
The New York Law Journal by Daniel Wise - July 9, 2010

Michael Lippman, who had been counsel to the public administrator in the Bronx for more than 30 years when he was terminated in April 2009, pleaded not guilty yesterday to charges of taking excessive fees for his work on five estates, amounting to $300,000. A 15-count indictment brought by the Bronx District Attorney's Office also accused Mr. Lippman of filing false documents to conceal the excessive fees. Mr. Lippman surrendered yesterday and prosecutors agreed to his release without bail by Acting Supreme Court Justice Steven L. Barrett. Mr. Lippman's lawyer, Murray Richman, said "there is no basis for the charges." The alleged thefts took place before guidelines set in 2002 by the Administrative Board of the Offices of the Public Administrators were adopted, he added. The guidelines set a fee of 6 percent on the first $750,000 of an estate with the percentage decreasing incrementally on greater amounts. Mr. Lippman also was accused of concealing his overcharges from Bronx Surrogate Lee L. Holzman by misstating in court documents the amounts he had taken from the estates. If convicted of the top charge, second-degree grand larceny, Mr. Lippman could be sentenced to a maximum of five to 15 years in prison. The New York Daily News first reported in October 2009 that Mr. Lippman was being investigated by the New York City Department of Investigation and the Bronx District Attorney's Office. The indictment names five cases: Estate of Cushman, Estate of Greenbaum, Estate of McGoldrick, Estate of Laskhoff and Estate of Risso. One source close to the investigation said thefts had occurred in far more than the five case and that Mr. Lippman used money taken in new cases to replenish funds missing from older matters.

Excessive fees was an issue in 2005 when the New York Court of Appeals removed then-Brooklyn Surrogate Michael R. Feinberg from the bench for routinely awarding 8 percent fees to the then-counsel for the Brooklyn public administrator, Louis R. Rosenthal. Mr. Rosenthal was suspended for two years and the Attorney General's Office has taken legal action to recover the excessive fees from him. No criminal charges were brought against either Mr. Feinberg or Mr. Rosenthal. There is no suggestion in the indictment that Surrogate Holzman was aware that Mr. Lippman had charged excessive fees. In fact, in a statement distributed by the Bronx District Attorneys Office, prosecutors said that "in some instances" Mr. Lippman underreported his fees "in reports filed with the court to hide the excessive fees." The indictment also accused Mr. Lippman of taking advances for his fees from the estates. The guidelines do not specifically address the issue of "advance fees," but the practice in Manhattan for many years has been for counsel to the public administrator to submit for 60 percent of the fee when an accounting is filed and the remaining 40 percent when the decree is issued. Mr. Richman vowed a vigorous defense, saying that the alleged criminal acts took place after the five-year statute of limitations had expired. The only way that those acts could be prosecuted, he said, would be if the position of "counsel to the public administrator" were to be considered a public officer, in which case the statute would run for 10 years. Given that the counsel position is created by statute, he said such a legal conclusion was unlikely. Mr. Richman also said that to focus on five cases out of the roughly 1,000 that Mr. Lippman handled during the seven years covered by the indictment made it a "stretch" to maintain he had a criminal intent. He added that Mr. Lippman may have charged fees before he knew the size of an estate or the amount of work involved, but he returned the amounts when he realized the changed circumstances. The counsel to the public administrator processes the estates of persons who die without a will and with no close relative to wrap up their affairs. A joint statement issued yesterday by Bronx District Attorney Robert T. Johnson and Investigation Commissioner Rose Gill Hearn also asserted that Mr. Lippman had been tardy in filing accounting, resulting in estates "lingering for years." Daniel Wise can be reached at dwise@alm.com.

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Michael Lippman, lawyer for Bronx Public Administrator, stole $300,000, prosecutors charge
The New York Daily News by Brendan Brosh - July 9, 2010

His job was to help the living. Instead, a ruthless Bronx lawyer plundered $300,000 from the estates of the dead, prosecutors charge. Lawyer Michael Lippman, counsel to the Bronx public administrator from 1983 through last year, surrendered yesterday to face charges of billing for work he never performed on five estates. Lippman, whose shenanigans were first exposed by the Daily News last year, was arraigned in Bronx Supreme Court on charges that could put him in jail for up to 15 years.

Public administrators are supposed to find heirs when someone dies without a will, and then fairly distribute an estate's assets as quickly as possible. The survivors are often vulnerable families unfamiliar with the intricacies of probate law. The city Department of Investigation charged Lippman repeatedly took advance fees from the estates without court approval. In each case, the bill was either inflated or for work that was never done. DOI Commissioner Rose Gill Hearn said Lippman used his position "to extract excessive and unearned fees from the estates of deceased Bronx residents." He pleaded not guilty and was released without bail. His lawyer, Murray Richman, said the statute of limitations had expired on the charges of grand larceny, scheming to defraud and falsifying business records. Lippman pocketed more than $1.5 million in upfront fees between 2005 and April 2008, before he was dogged with questions about the practice. Records show that during that time, Lippman was drowning in debt - facing foreclosure on a $400,000 mortgage, $1 million in gambling losses and $600,000 in unpaid taxes. Richman said the Bronx district attorney's office was meddling in a lawyer's ability to run his business. "It puts a chilling effect on all attorneys charging fees because the district attorney has the opportunity to look over what fees can be charged," he said. Lippman is expected back in court in October.

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Bronx lawyer in 300G bust
The New York Post by DAVID SEIFMAN - July 9, 2010

The longtime counsel to the Bronx Public Administrator was indicted yesterday on charges of swiping more than $300,000 in legal fees to which he wasn't entitled. Michael Lippman, 65, of Scarsdale, was accused of drawing advance fees without court approval from five estates since 2002 and in amounts that exceeded the legal limits. The public administrator oversees the estates of those who die without a will. Lippman, who served in his post from 1983 until April 2009, faces numerous felony counts that could land him in prison for up to 15 years upon conviction. He pleaded not guilty at his arraignment. Murray Richman, Lippman's lawyer, said his client handled thousands of estates over the years and drew money from estates for legal work that he did.

Fraudster NY Lawyer Disbarred

Fraudster NY Lawyer Disbarred
The New York Law Journal by Noeleen G. Walder - July 8, 2010

A lawyer who cheated the federal government out of millions of dollars and then directed a client to destroy documents in an attempt to cover up his scheme has been disbarred. In 2009, attorney Steven M. Coren pleaded guilty in Eastern District federal court to skimming funds that his clients—contractors working on public housing and infrastructure projects—were legally obligated to pay laborers under the federal Davis-Bacon Act and state Labor Law. To create the illusion that he was complying with prevailing wage laws, Mr. Coren, of Manhattan-based Coren & Associates, had his clients place monies supposedly intended for employee benefits in a special trust. The funds were then pocketed by the lawyer and his clients, who submitted bogus payroll documents to the contracting public agencies. At his plea allocution Mr. Coren, who was sentenced to 30 months in prison in February, admitted that he had advised a client to destroy a computer flash drive that could have been used in a federal investigation. Last week, a unanimous panel of the Appellate Division, First Department, in Matter of Steve M. Coren, M4169, found that the federal crimes of which Mr. Coren was convicted were substantially similar to state felonies to trigger automatic disbarment.

Thursday, July 8, 2010

Could the 2nd Circuit Court Finally Be Waking Up ?

United States v. Woltmann, 10-413

U.S. COURT OF APPEALS, SECOND CIRCUIT
Criminal Practice
New York Law Journal07-07-2010 - Before: Jacobs, Ch.J.; Winter and Walker, C.JJ.

Decided: July 6
RICHARD M. LANGONE, Langone & Associates, Levittown, New York, for Appellant.
CHARLES P. KELLY, for Loretta E. Lynch, United States Attorney's Office for the Eastern District of New York, Brooklyn, New York, for Appellee.

Defendant-appellant Gary Woltmann pled guilty in the United States District Court for the Eastern District of New York (Platt, J.) to one count of tax fraud. Woltmann filed a notice of appeal challenging the sentence, and the government countered with a motion to dismiss on the basis of the appeal waiver provision in the plea agreement. We conclude that the waiver is unenforceable, and we vacate and remand to a different district judge for re-sentencing.

DENNIS JACOBS, Ch.J.:

Defendant-appellant Gary Woltmann pled guilty in the United States District Court for the Eastern District of New York (Platt, J.) to one count of tax fraud. Woltmann filed a notice of appeal challenging the sentence, and the government countered with a motion to dismiss, citing Woltmann's waiver of appeal in the plea agreement ("the Agreement"). We conclude that the waiver is unenforceable, and we vacate and remand to a different district judge for re-sentencing.

I - Pursuant to the Agreement, Woltmann pled guilty in September 2007. After signing the Agreement but before sentencing, Woltmann provided substantial assistance to the government in its (ultimately successful) prosecution of another criminal tax fraud case. In exchange for this cooperation, the government submitted a letter to the district court pursuant to U.S.S.G. 5K1.1 "urg[ing] the Court to consider formulating a sentence below the advisory guidelines" range of 18 to 24 months' imprisonment.1 At a December 11, 2009 hearing ("December 11 Hearing"), defense counsel and the government urged the district court to consider the 5K1.1 letter and the factors enumerated in 18 U.S.C. 3553(a) when imposing sentence. Notwithstanding these prompts, the district court deemed the 5K1.1 letter an improper effort by the parties to repudiate, modify, or amend the Agreement, and ruled that the Agreement constituted Woltmann's consent to any sentence at or below 27 months (the upper limit of the appeal waiver provision). Accordingly, the judge discounted the 5K1.1 letter and the other factors enumerated in 3553(a). At a hearing on January 22, 2010 ("January 22 Hearing"), the district court sentenced Woltmann principally to 18 months' imprisonment (the low end of the Guidelines range). In short succession, Woltmann filed a notice of appeal in this Court; the government moved to dismiss on the basis of the appeal waiver provision in the Agreement; and Woltmann moved for bail pending appeal.

On April 7, 2010, we granted Woltmann's bail motion. See United States v. Woltmann, 10-0413-cr (Apr. 7, 2010) (order). The government's motion to dismiss was then submitted to this panel. Because the facts, rules, and considerations that bear upon the motion likewise control the merits of the underlying appeal, we heard oral argument on the merits, and we resolve the merits together with the motion: The government's motion is denied, Woltmann's sentence is vacated, and the matter is remanded to a different district court judge for re-sentencing.

II - Three provisions of the Agreement have bearing on this appeal:

• Paragraph 2 states that the applicable Guidelines term of imprisonment is 18-24 months.

• Paragraph 2 acknowledges that "the Guidelines are advisory and the court is required to consider any applicable Guidelines provisions as well as other factors enumerated in 18 U.S.C. 3553(a) to arrive at an appropriate sentence in this case."

• Paragraph 4 contains an appeal waiver provision: "The defendant agrees not to…appeal…the conviction or sentence in the event that the Court imposes a term of imprisonment of 27 months or below. This waiver is binding without regard to the sentencing analysis used by the Court."

Provisions like these are common, and their inclusion in the Agreement is unexceptional.

At the December 11 Hearing, the government reiterated its position, expressed in the 5K1.1 letter, that the court should impose a below-Guidelines sentence due to Woltmann's substantial assistance. See, e.g., Tr. of December 11 Hearing at 8. The district court refused. It viewed the Agreement as the "governing" or "controlling" instrument, e.g., id. at 4-5, and reasoned that the government's advocacy of a below-Guidelines sentence on the basis of the 5K1.1 letter was an impermissible attempt to "repudiate," "modify," or "amend" the Agreement, e.g., id. at 5, 14. The district court felt free to ignore the 5K1.1 letter and the 3553 factors because Woltmann had ostensibly "consented to such and such a sentence" by agreeing both to the Guidelines calculation in Paragraph 2 and the appeal waiver in Paragraph 4. Id. at 6. In effect, the district court believed that because of the appeal waiver, any sentence at or below 27 months was appropriate, regardless of whether or how the 5K1.1 letter and the 3553(a) factors--if considered--would bear on the sentence.

At the January 22 sentencing hearing, the district court stated that it had "considered the [A]greement that was made with the government and the provision that we just read, paragraph four [i.e., the appeal waiver provision], and the court feels that under the circumstances here and the family circumstances that an 18 month sentence is an appropriate one." Tr. of January 22 Hearing at 12. The court also intimated, as it had done at the December 11 Hearing, that consideration of the 5K1.1 letter would constitute an impermissible repudiation of the Agreement:

[Defense Counsel]: I would just like to point out to the court, judge, first, that all of the guideline calculations were based upon an estimate prior to any cooperation or 5K1 letter.

The Court: Are you saying he wants to repudiate the plea agreement?
Id. at 4

Woltmann filed a notice of appeal, and the government moves to dismiss citing the appeal waiver in Paragraph 4 of the Agreement. Woltmann in turn argues that the district court's treatment of the 5K1.1 letter and the 3553(a) factors requires us to vacate the sentence and remand for re-sentencing. We agree.

III - Plea agreements are reviewed "in accordance with principles of contract law." United States v. Vaval, 404 F.3d 144, 152 (2d Cir. 2005) (internal quotation marks omitted). We consider "the reasonable understanding of the parties as to the terms of the agreement." United States v. Colon, 220 F.3d 48, 51 (2d Cir. 2000). Moreover, because plea agreements are "unique contracts,…we temper the application of ordinary contract principles with special due process concerns for fairness and the adequacy of procedural safeguards." United States v. Granik, 386 F.3d 404, 413 (2d Cir. 2004) (internal quotation marks omitted). Such contracts are narrowly construed. Id.

It is a "well-settled legal principle that the sentencing judge is of course not bound by the estimated range in a plea agreement." United States v. Hamdi, 432 F.3d 115, 124 (2d Cir. 2005) (internal quotation marks omitted). To the contrary, before imposing sentence, a district court must consider both a 5K1.1 letter (if one is proffered), United States v. Campo, 140 F.3d 415, 418-19 & n.5 (2d Cir. 1998) (per curiam), and the factors enumerated in 3553(a), Gall v. United States, 552 U.S. 38, 49-51 (2007).

Ordinarily, appeal waivers are enforced--and for good reason. See United States v. Morgan, 386 F.3d 376, 380 (2d Cir. 2004) (explaining that voiding such waivers "would render the plea bargaining process and the resulting agreement meaningless" (internal quotation marks omitted)); United States v. Gomez-Perez, 215 F.3d 315, 318 (2d Cir. 2000) ("[T]he benefits of such waivers inure to both government and the defendant alike, with the government receiving the benefit of reduced litigation, and the defendant receiving some certainty with respect to his liability and punishment."); United States v. Yemitan, 70 F.3d 746, 747-48 (2d Cir. 1995) ("If this waiver does not preclude a challenge to the sentence as unlawful, then the covenant not to appeal becomes meaningless and would cease to have value as a bargaining chip in the hands of defendants."). But we will not enforce an appeal waiver where--as here--the "sentencing decision…was reached in a manner that the plea agreement did not anticipate," United States v. Liriano-Blanco, 510 F.3d 168, 174 (2d Cir. 2007); see also United States v. Roque, 421 F.3d 118, 123-24 (2d Cir. 2005) (suggesting that an appeal waiver would be unenforceable if the defendant failed to "underst[an]d fully the consequences of his bargain, both in terms of what he was gaining and what he was giving up"), or where "the sentencing court failed to enunciate any rationale for the defendant's sentence, thus amounting to an abdication of judicial responsibility subject to mandamus," Gomez-Perez, 215 F.3d at 319 (brackets and internal quotation marks omitted). Applying these principles, we hold that vacatur is required because the district court: (1) improperly "relied" on the Agreement to the exclusion of the 5K1.1 letter and the 3553(a) factors; and (2) misread the Agreement as manifesting Woltmann's enforceable concession that any sentence at or below 27 months obviated the need to consider the 5K1.1 letter and the 3553(a) factors. In so doing, the district court failed to give effect to the parties' expectations and deprived Woltmann of the benefit that he (and the government) agreed he would receive from signing the Agreement (i.e., a weighing of the 5K1.1 letter and the 3553 factors). At the same time, the court also "abdicated" its judicial responsibility in the way posited by Gomez-Perez, 215 F.3d at 319.

A - As the transcript of the December 11 Hearing unambiguously shows, the district court felt itself entitled to rely on the Agreement notwithstanding our law that such reliance is misplaced. See Hamdi, 432 F.3d at 124. For example, when the government raised the 5K1.1 letter at the outset of the hearing, the court responded: "[T]his is all very good, but we have--starting this case off, with an agreement that you and counsel for the defendant made, and signed by the defendant, and as far as I'm concerned, that is still the governing instrument here.…The plea agreement is the controlling instrument." Tr. of December 11 Hearing at 4-5. Other examples abound. See, e.g., id. at 5 ("[The government], the defendant, and the defense lawyer made an agreement, and that agreement has been, in my book, controlling right from the start here."); id. at 7 ("[A]s I see it at the moment, [the Agreement] overrides all else in this picture."); id. at 11 ("[Y]ou made an agreement and I'm entitled to rely on it."); id. at 15 ("I'm troubled by the government's position that I may ignore this agreement, which I don't think that I can or I may, I can, but I may not."); id. at 20 ("What is controlling in my book is the agreement.…").

This (improper) reliance caused the district court to misread the Agreement and, as a result, to impose a sentence inconsistent with the parties' expectations in signing the Agreement. The Agreement--by its own terms, as it was unambiguously understood by both parties, and as it was initially understood by the district court--contemplated that sentence would be imposed only after the district court considered the 5K1.1 letter and the 3553(a) factors. See Agreement ¶2 ("The defendant understands that…the Guidelines are advisory and the court is required to consider any applicable Guidelines provisions [i.e., 5K1.1] as well as other factors enumerated in 18 U.S.C. 3553(a) to arrive at an appropriate sentence in this case."); id. ¶3 ("The Guidelines estimate set forth in [P]aragraph 2 is not binding on…the Court."); Transcript of Plea Colloquy at 15 (September 18, 2007) (district court summarizing Paragraph 2 of the Agreement and ensuring that Woltmann understood that his sentence would be based on "any applicable guidelines together with the factors contained in 18 U.S.C. [§] 3553(a)"); December 11 Hearing at 8 (government urging the court to impose a below- Guidelines sentence pursuant to the 5K1.1 letter); see also Tr. of January 22 Hearing at 4 (defense counsel emphasizing to the court "that all of the guideline calculations were based upon an estimate prior to any cooperation or 5K1[.1] letter"). Moreover, the government explained to the district court that although some plea agreements preclude both parties from making any motions, this Agreement did not:

This agreement does not preclude motions by any party. Occasionally we will insert in these agreements that the parties agree that no motions will be filed in connection with the sentencing. That sentence is not in this agreement. And since the signing of the agreement, Mr. Woltmann has cooperated, and I was--the government was simply trying to bring that to the Court's attention in formulating a sentence.

Tr. of December 11 Hearing at 15-16. This omission was intentional: The government intended to preserve its ability to offer a 5K1.1 letter for the court's consideration at sentencing.

Notwithstanding all this, the court concluded that, in urging consideration of the 5K1.1 letter, the parties were improperly attempting to repudiate or modify the Agreement-- and repeatedly rebuked them for doing so. See, e.g., id. at 9 ("[T]he government is changing its position here with respect to this waiver."); id. at 11 (sparring with the government and finding it necessary to "read [the Agreement] to you again because you apparently have not been reading it"); id. at 11-12 ("I never had a case where the government has made a firm agreement and then goes out and tries to modify it, in effect."); id. at 13 ("[The government is] trying to modify that agreement."); id. at 14 ("[The government] can't amend it this way, as I see it."); id. at 15 ("And to attempt to modify that agreement in this fashion I find very troubling."); id. at 16 ("I don't think that you can modify this agreement that you made here.").

In effect, the court refused to consider the 5K1.1 letter and the 3553(a) factors on the ground that the appeal waiver and the sentencing range in the Agreement obviated anything else. This erroneous conclusion denied the parties their bargain and reasonable expectations. In this way, the district court erred, and the appeal waiver provision is unenforceable. Liriano-Blanco, 510 F.3d at 174; Roque, 421 F.3d at 123-24.

B - The district court misconstrued the Agreement as an enforceable concession by Woltmann that any sentence at or below 27 months was appropriate--without regard to any 5K1.1 letter and the 3553(a) factors. For example, the following colloquy took place at the December 11 hearing:

[Prosecutor]: [T]he government does not believe that [the 5K1.1 letter] affects the plea agreement in any way. However, when the Court moves to set a sentence under 3553(a), we ask the Court to consider a sentence below the guidelines in part because of the cooperation of Mr. Woltmann. So I think it plays a role in the second step, when you get to the 3553(a) factors.

The Court: What need do I have to get to that level when I have a plea agreement where he has consented to such and such a sentence?

[Prosecutor]: Well, what's been consented to and agreed to is the guidelines.

The Court: No. No.

December 11 Hearing at 6-7 (emphasis added). Similarly:

[Prosecutor]: [P]aragraph 4 of the plea agreement…is simply a waiver of appeal or challenge to the sentence. All it does is set a ceiling below which there cannot be any appeal.…It is not an agreement to a sentence of that length. It is simply a waiver of appeal. What the parties have agreed within the agreement is that the guidelines are 18 to 24 months, and then if the Court accepts that and moves from the agreement to 3553, and considers the factors under 3553, the government believes one of the factors is Mr. Woltmann's cooperation, which the government believes warrants a sentence below the 18 to 24 month guideline.

The Court: That is a lot of double-talk when you get right down to [it].

Id. at 8. And again:

[Prosecutor]: There's an appeal waiver up to 27 months. That was never a sentencing recommendation of the government. There's a guideline of 18 to 24 months. Those two facts come out of the plea agreement. At that point when the Court enters its 3553 analysis, the guidelines [are] one of the things that the Court--one of the items that the Court looks at in formulating a sentence. So there's a guideline of 18 to 24 months, and then one of the things the Court considers--

The Court: What you're saying is that this is, I'm not entitled to rely on the agreement that the defendant has made.

[Prosecutor]: You are entitled to rely on it. He has waived his appeal and any challenge to it for a sentence up to 27 months. He agrees that the guidelines are 18 to 24 months. Those two things are agreed. But then the Court is required to move under Gall, G-A-L-L, over to the 3553.

The Court: I don't have to do anything if I have this agreement. Because it's not challengeable according to you, the agreement itself.

[Prosecutor]: But the agreement doesn't contain any sentencing recommendation.

The Court: The agreement says he may not challenge anything that the Court does…in the event the Court imposes a term of imprisonment of 27 months or below. This waiver is binding without regard to the sentencing analysis used by the Court. The defendant waives all defenses…. You're trying to modify that agreement.

[Prosecutor]: No. The fact--

The Court: I don't think you may.

[Prosecutor]: The fact that nobody can challenge it does not mean that it's the appropriate sentence or that anybody--

The Court: It's not a question of an appropriate sentence. It is appropriate by both sides['] agreement if it's 27 months or below.

[Prosecutor]: Well, not that it's appropriate, but that no one will appeal it or challenge it in any way.

Id. at 12-14 (emphases added).

The district court's actions "amount[ed] to an abdication of judicial responsibility," Gomez-Perez, 215 F.3d at 319, requiring us to deem the appeal waiver unenforceable. The mandate of Campo, 140 F.3d at 418-19 & n.5, and Gall, 552 U.S. at 49-51, is that a district court must consider a 5K1.1 letter and the 3553(a) factors when formulating the appropriate sentence. Refusal to consider these things is an error categorically different from a misapplication of a guideline, or a mistake of law, or a dubious finding of fact. What happened here is in the category of error contemplated in Gomez-Perez, 215 F.3d at 319, which states that an appeal waiver is unenforceable when the district court abdicates its duties in imposing sentence.

IV - On remand, Woltmann's re-sentencing should proceed before a different district court judge. Three considerations guide our analysis: "(1) whether the original judge would reasonably be expected upon remand to have substantial difficulty in putting out of his or her mind previously-expressed views or findings determined to be erroneous, (2) whether reassignment is advisable to preserve the appearance of justice, and (3) whether reassignment would entail waste and duplication out of proportion to any gain in preserving the appearance of fairness." United States v. Hernandez, 604 F.3d 48, 55-56 (2d Cir. 2010) (internal quotation marks, brackets, and ellipses omitted). These considerations favor reassignment.

1. In light of the scorn with which Judge Platt approached the matters pertaining to sentencing, we have considerable doubt as to whether on remand he would give fair consideration to the 5K1.1 letter and the 3553(a) factors. Our doubt is reinforced by events at the December 11 Hearing, when the district court considered itself to be (in terms or effect) a party to the Agreement, or a beneficiary of the appeal waiver. For example, the court declared: "I am entitled to rely on an agreement. I want to make that abundantly clear that's my position." Tr. of December 11 Hearing at 22; see also id. at 11 ("[The government] made an agreement and I'm entitled to rely on it."). And: "[The government] made an agreement with respect to all three of us. . . ," id. at 14 (emphasis added).

The district court's strange misconception of its role vis-a-vis the parties and the Agreement may explain the court's asserted right to "rely" on the Agreement, and its conspicuous frustration at what the court viewed (erroneously) as the parties' attempt to repudiate or modify the Agreement. It also casts doubt on the ability of the judge on remand to suppress a view of the Agreement premised on his own claim of right.

2. In considering the appearance of justice, we must consider Judge Platt's pattern of error regarding 5K1.1 letters. See United States v. Doe, 348 F.3d 64 (2d Cir. 2003) (per curiam); Campo, 140 F.3d 415.

3. Finally, reassignment would not waste substantial judicial resources, because all the district court must do on remand is what district courts do as a matter of routine: consider the 5K1.1 letter and the 3553(a) factors, and impose sentence accordingly.

CONCLUSION

For the foregoing reasons, we vacate the sentence and remand for re-sentencing before a different district court judge.

1 Section 5K1.1 provides that "[u]pon motion of the government stating that the defendant has provided substantial assistance in the investigation or prosecution of another person who has committed an offense, the court may depart from the guidelines."

Sampson 49G SUV After 'Brunomobile' Rip

Sampson 49G SUV after 'Brunomobile' rip
The New York Post by FREDERIC U. DICKER, State Editor - July 7, 2010

ALBANY, NY -- State Senate Democrats who bashed Republicans last year for spending $50,000 on a luxury "Brunomobile" have just purchased a new SUV for Conference Leader John Sampson for more than $49,000, The Post has learned. The 2010 "Sampsonmobile" is a 2½-ton, 332-horsepower Chevy Tahoe hybrid SUV that seats eight people. The vehicle comes equipped with a rear camera, ultrasonic rear parking assist and other luxury appointments, and is almost 17 feet long. Senate Democrats, who have been battling Gov. Paterson's attempts to restrain state spending in the face of a $9.2 billion deficit, had mocked former Senate Majority Leader Joe Bruno (R-Rensselaer) for his purchase of the Brunomobile. At the time, a Democratic spokesman called it "an outlandish use of taxpayer resources." But Democrats defended the purchase of the equally pricey Sampsonmobile, which was described as costing just over $49,000, as an effort to cut state costs. "Currently, Sen. Sampson's car, a 2005 Crown Victoria, gets 8 miles per gallon and the new one gets just over 20 miles per gallon," said Austin Shafran, a spokesman for the Brooklyn Democrat. "We're looking to achieve fuel savings and savings on the cost of maintenance as we go forward." Shafran estimated that $15,000 will be saved in fuel and maintenance over the next five years. He said the state had received a $26,000 credit by trading in the large, fully equipped, 2007 GMC Savana that was purchased for $50,000 in 2007 for Bruno. Senate Democrats had made the Brunomobile a symbol of a spendthrift GOP shortly after taking control from the Republicans in January 2009. In early 2009, a Senate Democratic spokesman estimated that Bruno's wheels would be worth only $12,000 on a trade-in. Senate Republican spokesman John McArdle called the Democrats "hypocrites who say one thing and do another, like they're doing by raising taxes and spending at the same time they're spending $50,000 for a new vehicle, a Sampsonmobile." "This purchase just shows how misplaced their priorities are," McArdle continued. Even some Democrats were sharply critical of the purchase. They noted that Paterson has repeatedly warned that the state has faced a cash-flow crisis and has been barely able to cover some of its bills in recent weeks. "This was stupid and it's not the message that Democrats ought to be sending," one senior state official said. The 62-member Senate has some 20 vehicles assigned for a variety of uses, with top leaders being given cars and, whenever they need them, drivers, who usually double as administrative aides. Among those assigned state cars are Senate President Malcolm Smith (D-Queens), with a 2007 Chrysler Touring Car; Sen. Jeff Klein (D-Bronx), a 2003 Ford Crown Victoria; Senate Finance Committee Chairman Carl Kruger (D-Brooklyn), a 2006 Crown Vic; and Senate Minority Leader Dean Skelos (R-Nassau), a 2006 Crown Vic. The 150-member Assembly has many more vehicles, as does the Governor's Office.

The “Sampsonmobile” Chevy Tahoe

* 5,270 pounds, 17 feet long, seats eight adults
* Rear-view camera and ultrasonic parking assist
* Hybrid gets 21 mpg city; 22 highway
* 332-hp, 8-cylinder engine
* Four-wheel disc brakes, traction control
* Three months of XM radio
* Wired for Bluetooth-enabled cellphones
* $50,720 MSRP
fredric.dicker@nypost.com

Sunday, July 4, 2010

NY Courts Failing Kids, Again

A court's tragic ruling keeps kids in failing schools: Chancellor Joel Klein reacts to judge's order
The New York Daily News by Joel Klein - July 2, 2010

Last week, the respected research group MDRC published a landmark report which found that the policy of replacing our city's failing schools with new, small high schools has resulted in dramatic improvements in the lives of tens of thousands of our children, including many traditionally disadvantaged students. That is why it was so disappointing yesterday when the Appellate Division of State Supreme Court affirmed the ruling of a lower court, halting the City Department of Education, solely on technical grounds, from replacing 19 failing schools. While I firmly believe that the effect of this ruling - which will force us to admit students to schools that have long failed to graduate more than half their students - is bad for New York City children, we will, of course, follow it. But I want to make clear: The Mayor and I remain steadfast in our commitment to providing New York City's students and families with better schools and more options, and I know we will succeed. The reason is this: With every passing day more people awaken to the reality that we cannot and will not maintain our status as the greatest city and the greatest nation if we do not make the hard choices necessary to provide each child the best education possible. For example, for years the city's teachers have been subjected to a perfunctory system of evaluation that rates them either "satisfactory" or "unsatisfactory" and pays all teachers as if they were equally effective. That's starting to change.

In the last month alone, our state has mandated that we implement a system of evaluation that actually works for our teachers and gives weight to how well our students are learning. And, just last week, we reached an agreement with the teacher's union on a plan to pay teachers who earn "highly effective" evaluations an additional 30% in their salary if they work in our most challenging schools. So we are making progress in improving the way we evaluate and reward our teachers. We are also making progress in offering our families more high school choices and a more personalized high school experience. As the MDRC report pointed out, students in our new small schools were more likely to be on track to graduation in their first year of high school, and to stay on track, compared to students in other high schools - the graduation rate of small schools is about seven points higher than that of other schools. Perhaps most importantly, our new small schools are particularly successful with students traditionally considered the most disadvantaged, including black and Hispanic students, special education students, students learning English and students entering high school with low proficiency levels. That's why, although we will admit students to the schools covered by the court's decision, we will still go ahead and open the small schools that were going to replace them, which have many students who selected them. It's also why we announced last week a commitment to turning around 34 of our lowest performing schools, some of which will be fully replaced. And it's why we've already begun to receive dozens of applications from educators here and across the country who want to start new schools in New York City next school year. We all wish all our schools would succeed but, unfortunately, that isn't always the case. So, as a last resort - but an essential last resort - we have closed failing schools and will continue to do so. It's been a great school year. But New Yorkers never settle for the status quo. I hear more voices for change than ever before, and we intend to deliver on the promise of change. Klein is chancellor of the New York City public schools.

Saturday, July 3, 2010

NY Post Editorial: "How Judges Kill"

How judges kill
The New York Post - EDITORIAL -July 3, 2010

Eight people were shot -- two fatally -- in four separate incidents in Brooklyn Wednesday night. Last month, 26 people were shot, three fatally, over the course of one weekend in Chicago -- grisly, but a marked improvement over the Windy City's previous weekend, when more than 50 were shot, with eight dying. An argument for tougher gun control? But New York City and Chicago already have some of the most stringent gun-control laws in America -- to no apparent good effect. So perhaps the real issue is a fundamental cultural disrepect for the value of human life -- and not just on the street. Especially not just on the street. Take Wednesday's absurd decision by a three-judge federal panel that rescued a notorious Staten Island cop-killer from an exceedingly rare -- but well-deserved -- death sentence. The 2-1 decision by the US Second Circuit Court of Appeals was based on but a few words of a lengthy prosecutor's summation during the penalty phase of Ronell Wilson's trial, after he was convicted of murdering undercover cops James Nemorin and Rodney Andrews in 2003. Ironically enough, Nemorin and Andrews were attempting to enforce tough gun laws when Wilson coldly and deliberately executed them. At issue was whether Wilson had genuinely expressed remorse for the killings after, as the trial judge put it, his guilt was "proved not merely beyond a reasonable doubt, but beyond all doubt." Wilson, a lifelong career criminal, shot Nemorin in the head, even as the detective pleaded for his life. When asked why he'd shot the cops, Wilson -- who reportedly was trying to win high esteem within his local Bloods gang -- replied: "I don't give a f--- about nobody." This was the first time in more than half a century that federal prosecutors had successfully convinced a New York City jury to vote for a death sentence. Indeed, the jury -- which the trial judge called "among the most attentive and serious I have ever seen" -- did so even after accepting most of the mitigating factors that Wilson's lawyers advanced; the penalty phase alone took nine days. Yet the appeals judges voted to spare Wilson's life based on a few words in a trial record stretching thousands of pages -- part of their decision actually rested on the prosecutor having said "has never been" instead of "was not." Detectives Nemorin and Andrews, it must be noted, left five young children between them. It's hard to imagine what they will come to think of a society that is so obsessed with process that it has lost sight of simple justice. Wilson callously murdered two cops, forfeiting his own right to life when he did so. But the court restored it. That message won't be missed on the streets, where human life is held far too cheap already. And that, not guns themselves, is the real problem.

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