Bobby N. Harmon, CPCU, ARM
Louisville, Kentucky 40229-1655
December 15, 2003
VIA fax only @ (559) 490-1919
Ms. Julie A. Schermerhorn, Supervisor, and
Mr. Justin W. Schuck, Case Manager
American Arbitration Association
6795 North Palm Avenue, 2nd Ave.
Fresno, California 93704
RE: Mary Lou Woo, Trustee v. Bobby N. Harmon - Case No. 74 166 00491 03 JUSC
Dear Ms. Schermerhorn and Mr. Schuck:
This letter responds to Steven Guttman’s letter to you dated December 11, 2003, in which he states:
“In his letter to Ms. Neustadter dated December 4, 2003, Mr. Harmon requests that the Arbitrator provide detailed information as to any relationship she has had with a long list of individuals and entities. Ms. Neustadter has already provided the parties with the requisite disclosures. She has already stated that, to her knowledge, there is no conflict of interest in her serving as the arbitrator in this proceeding. She has already agreed to promptly advise the parties in the event she becomes aware of a potential conflict. Mr. Harmon’s ongoing interrogation into matters which have been thoroughly addressed is tantamount to harassment.
“Furthermore, we reiterate our position that Mr. Harmon’s continued demands for information concerning the identity of the professional liability insurance providers used by the Trustee, Ms. Neustadter and my firm have no bearing whatsoever on the appointment and retention of Ms. Neustadter as the arbitrator or on any other issues raised in this arbitration. His ongoing probes serve only to waste the time and resources of the Trustee.”
I must object, again, to Mr. Guttman’s avoidance of any factual response to my letter of December 4, 2003. As he has done in many previous replies, he is merely expressing his “opinion” that Ms. Neustadter has no conflicts of interests with any of the parties I have named.
Again, as I have stated in previous letters, Mr. Guttman appears to be speaking on Judith Neustadter’s behalf as her attorney, even stating that my questions are “tantamount to harassment.” Ms. Neustadter is an attorney herself, and it is my belief that she should be allowed to decide for herself whether or not she believes these questions rise to the level of harassment and, if so, then she should be able to object to my inquiries, if she so desires.
With regard to Mr. Guttman’s statement that Ms. Neustadter “has already agreed to promptly advise the parties in the event she becomes aware of a potential conflict,” I would point out that I am attempting to do precisely that – by making her aware of potential conflicts before we get too far along in the proceedings and have to start all over again with a new arbitrator.
Mr. Guttman states that I am requesting “that the Arbitrator provide detailed information as to any relationship she has had with a long list of individuals and entities.” I would remind Mr. Guttman that he has, with the AAA’s approval, demanded that my questioning of Ms. Neustadter be limited by not revealing to her what I suspect those potential conflicts might be. Consequently, while I have described the nature of some of the possible conflicts to you and Mr. Guttman, I have not been permitted to address the specific nature of these concerns with Ms. Neustadter directly. If I could be allowed to describe to her what I perceive to be potential conflict-of-interest situations in this case, I believe the “long list of individuals and entities” could be shortened and my questions structured more specifically.
As I have stated in previous letters, I am constantly becoming aware of new potential conflicts in this case. I have also said before that should the information I have provided is not sufficient to disqualify Ms. Neustadter, then I can furnish additional facts. I continue to believe that she should be made fully aware of these situations now, not later, to enable her, and not Mr. Guttman, to decide if a potential conflict might exist.
Here is just one new example of how Ms. Neustadter’s employment by Maui County places her in a potential conflict-of-interest position. The following was just published in the December 13, 2003, edition of the Honolulu Star-Bulletin:
Maui Battles Federal Lawsuit Over Church Site
By Mary Adamski
The National League of Cities is backing Maui County in its fight to keep the federal government out of state and local government zoning matters.
The county asked U.S. District Judge Samuel King yesterday to dismiss a U.S. Justice Department lawsuit filed on behalf of Hale O Kaula church, whose application to build a chapel was denied by the Maui Planning Commission.
Constitutional law expert Marci Hamilton, a professor at Cardozo School of Law in New York City, told King that the Justice Department suit is based on “an illegitimate law.” The 3-year-old Religious Land Use and Institutionalized Persons Act “disables zoning law to the benefit of religious entities,” said Hamilton....
Hale O Kaula filed suit in 2001 after the Maui commission denied its application for a special use permit to build a second-floor chapel on an existing agricultural building.
Hamilton was instrumental in the death of an earlier effort by Congress to enhance the First Amendment guarantee of exercise of religious freedom. In 1997 the U.S. Supreme Court found the 1990 Religious Freedom Restoration Act unconstitutional, upholding a zoning action by Hamilton’s client, the Texas city of Bourne, denying a building permit to a church.
The participation of major players here indicates that the case has grown far beyond the 60-member church and its plan for its six acres in Pukalani. King has commented several times that the suit is destined for the U.S. Supreme Court.
“This is a symbolic case,” said University of Hawaii law professor Jon Van Dyke, who also appeared with Maui County attorneys.
He said the advantage given religious organizations by RLUIPA is “a special lane on the freeway. It invites us all to become religious to take advantage of the law.”
Maui County Deputy Corporation Counsel Madelyn D’Enbeau likened the federal agency’s intervention in a small county’s land use matter to a “steamroller. You want to get flattened, or you want to get out of the way?”...
King said he will rule after Christmas on the dismissal request as well as on motions from both sides calling for a summary judgment through which he could end the case before the trial scheduled for February, or at least deal with some issues without taking them to trial.
< END OF QUOTATION >
For further background information and connections between certain parties I have named in my letters, I quote from an article in the August 21, 2003 edition of The Honolulu Advertiser:
Kamehameha Schools told to make exception
by David Waite and Vicki Viotti
For the first time ever, a federal judge yesterday ordered Kamehameha Schools to enroll a non-Hawaiian student and to allow the 13-year-old boy to remain at the school until the judge lifts his action.
U.S. District Judge David Ezra emphasized that he was not deciding whether the schools’ Hawaiians-preferred admissions policy violates federal laws barring racial discrimination.
He said his action was meant solely to provide a fair resolution to problems faced by Brayden Mohica-Cummings. The boy had been accepted for admission, but the school rescinded that acceptance Aug. 13....
Ezra’s restraining order and injunction remain in effect while the Mohica-Cummings lawsuit is pending, but no trial date was set.
But a separate lawsuit could produce a definitive ruling on the issue. A similar challenge to the schools’ admission policy was filed in June this year in behalf of an unidentified youth. The senior judge of the U.S. District Court here, Alan Kay, is scheduled to hear that case Nov. 18 and could issue a ruling on the validity of the policy under federal law.
University of Hawaii Law School professor Jon Van Dyke, who specializes in constitutional issues, said Ezra’s action was so narrow in scope, dealing only with a restraining order and injunction, that it will likely not have much effect on the other cases pending before federal judges here.
But the action could serve as a “road map” in helping attorneys on either side of the other cases prepare their arguments, Van Dyke said.
John Goemans, a Big Island lawyer who represented Mohica-Cummings, agreed that Ezra’s action will have little effect on the case pending before Kay. Goemans said Ezra’s action yesterday applies only to the unusual set of circumstances Mohica-Cummings was facing....
Kamehameha attorney David Schulmeister said that the court order, though disappointing, was limited....
The courtroom reaction yesterday was hushed, as teary-eyed trustees, school alumni and other Native Hawaiians embraced and left quietly. Kamehameha Schools officials said they do not plan to appear Ezra’s court order....
Van Dyke said congressional passage of the “Akaka bill” – the proposal calling for Hawaiians to receive the same kinds of recognition given to Native American Indians – would likely support Kamehameha Schools’ “Hawaiians-only” admissions policy....
The bill, which is labeled after its sponsor, Sen. Daniel Akaka, D-Hawaii, is yet to receive congressional approval.
< END OF QUOTATION >
As stated in earlier letters, John Goemans was the attorney who represented me in my Wrongful Termination lawsuit against Kamehameha Schools. Judge Samuel King is the judge who was originally assigned my RICO case, but who excused himself due to the possible “appearance of conflict-of-interest” because he had been an outspoken critic of the Kamehameha Schools’ trustees. Both of these individuals are listed in the Respondent’s Witness List for this arbitration case. The person I had not previously connected with Ms. Neustadter is Jon Van Dyke.
Looking back, it appears that all of the last four potential arbitrators proposed by the AAA had connections to Kamehameha, as my letter dated July 19, 2003, illustrates:
This is in response to your letter of July 18, 2003, in which you state:
“After careful consideration of the parties’ contentions, the Association has determined that Lance M. Inouye will not serve as arbitrator in the above matter.
“Accordingly, the Association will make an administrative appointment and submits the following four (4) names of arbitrators, of which the Association plans to appoint.
Boyd P. Mossman, Esq.
Judith Neustadier [sic], Esq.
Alan Van Etten, Esq.
Patrick K.S.L. Yim
“A biographical statement about each of the arbitrators is enclosed.
“If the parties should have any factual objections with regards to any of the foregoing, they are to be filed with this office on or before July 23, 2003. If no factual objections are received by that date, of these arbitrators will be appointed to serve.”
The following are my factual objections to the appointment of these individuals:
Boyd. P. Mossman, Esq.
Mr. Mossman is an alumni of Kamehameha Schools and a current director in the Kamehameha Schools’ Alumni Association, Maui Region. He also currently sits on Kamehameha Schools Board of Advisors. Mr. Mossman is also a current trustee for the Office of Hawaii Affairs (OHA), serving along with Oswald Stender, a former Kamehameha Schools trustee who was named in my RICO lawsuit.
OHA suffered a legal setback in a United States Supreme Court decision (Rice vs. Cayetano) which held that elections for OHA trustees that permitted only native Hawaiians to vote for the trustees were race-based and discriminatory, and forced the State to open these elections to eligible voters of all races. The attorney for Rice in this case was John Goemans, who was also my attorney in my wrongful termination lawsuit against Kamehameha Schools.
In May, 2003, in a controversial expenditure of funds, OHA hired the Washington lobbying firm, Patton Boggs LLP, on a retainer of $450,000, to push the Akaka Bill which would create a formal process for Hawaiians to form their own sovereign government.
Judith Neustadier, Esq.
Ms. Neustadter’s biography shows her as “Secretary, Kumu Ao, Inc., a non-profit corporation promoting and perpetuating Hawaiian culture and education.” She holds a professional license as a certified “Ho’oponopono practitioner.” Both of these experiences would indicate a close connection with Kamehameha Schools – if not financially, at least philosophically.
Ms. Neustadter also indicates that she was involved in the AAA sponsored Training for Prudential Mass Claims ADR Project. Prudential is the company that handles Kamehameha’s Employees’ Retirement Plan which has been the subject of many of my “letter-writing campaign” letters. Much more about the class-action lawsuits and government fines levied against Prudential can be found at this website:
Judith Neustadter also holds the position as Hearing Officer for the Maui Planning Commission. In 1998, it was disclosed during Attorney General Margery Bronster’s testimony that House Speaker Joseph Souki received a $132,000 commission for a Maui land deal involving Bishop Estate and developer Everett Dowling, who sold the Estate a 100-acre parcel in Pukalani, Maui, in December 1996.
In an article in the September 11, 1998 edition of the Honolulu Star-Bulletin, reporter Rick Daysog wrote:
Bronster: ‘Sweetheart deals’ with cronies
“I believe certain trustees received kickbacks worth hundreds of thousands of dollars.”
– Margery Bronster
Raising the possibility of criminal charges, Attorney General Margery Bronster says Bishop Estate trustees received kickbacks, participated in illegal political campaign contributions and mismanaged Kamehameha Schools....
Key Figures Named in the Attorney General’s Petition
>> Joseph M. Souki
66, of Wailuku is a Democrat, the current speaker of the state House. The owner of a real estate company, Souki this summer was questioned by the state attorney general over a Maui land deal involving Bishop Estate that earned him a $132,000 commission. Souki denied any wrongdoing and said it was a private real estate transaction....
< END OF NEWSPAPER QUOTE>
Judith Neustadter was also a defendant in a controversial zoning case on Maui involving the denial of the use of agricultural property as a place of worship. According to a news release by The Becket Fund for Religious Liberty dated October 9, 2001:
“Members of the Maui Planning Commission today were served with copies of an amended complaint naming them as defendants in their individual, as well as official, capacities in a lawsuit filed by the Hale O Kaula church. The action came as they prepared to convene their regular meeting at the Maui County office building in Wailuku. The lawsuit was initially filed on September 19 in U.S. District Court in Honolulu.
“Named as individual defendants were Commission members Samuel Kalalau III, Jeremy F. Kozuki, Bernice Liu, Star Medeiros, Susan Moikeha, Herman Nascimento, Randy Piltz, Joseph Pontanilla and Mona Richardson. Other defendants in the lawsuit include Planning Director John E. Min, Maui Mayor James Apana, Jr., Commission Hearing Officer Judith Neustadter Fuqua, Hawaii Governor Benjamin Cayetano and State Land Use Commission Executive Director Anthony Ching. Mayor Apana, Gov. Cayetano and Mr. Ching are sued only in their official capacities. The suit also names the Maui Planning Commission, the County of Maui and the Land Use Commission of Hawaii as defendants....”
An article in the June 26, 2001 edition of the Star-Bulletin states:
“An elder in a Maui church says his members are willing to go to the nation’s highest court if the county does not grant them a permit to build a chapel on ... their farmland....
“In the last few years, Kamehameha Schools has been developed on the makai side of the church’s property. Across a gulch a commercial center is under construction.
“People here once said they lived in an isolated agriculture neighborhood,” Jenkins said. “Now, it’s not.”
“County hearings officer Judith Neustadter Fuqua has recommended the commission deny the permit because of ‘unacceptable levels of traffic and noise’ and the burden placed on public agencies for such needs as water and fire protection....”
An article in the June 28, 2001 edition of the Star-Bulletin states:
Maui commission turns down
church’s plan for a new chapel
The Maui Planning Commission denied a church’s request to build a chapel on agricultural land yesterday, triggering the likelihood of a legal challenge to state and county land-use laws....
Church officials said they did not present arguments during a contested-case hearing because officer Judith Neustadter Fuque expressed an opinion in favor of neighborhood residents during a settlement conference....”
This situation raises the question in many persons’ minds as to why the Maui Planning Commission would reject the rezoning of agriculture land for church use, while previously approving the rezoning of residential land for the much larger projects of Kamehameha Schools and a shopping center in the same neighborhood.
Alan Van Etten, Esq.
A biography for Alan Van Etten states, “After graduating from law school, Alan served as a law clerk to the Honorable William S. Richardson, Chief Justice of the Hawaii Supreme Court.”
Chief Justice William Richardson is a former Trustee for Kamehameha Schools, and was an officer for P&C Insurance Company at the time of my termination. Mr. Richardson was a named Defendant in my RICO lawsuit.
Notwithstanding the obvious conflict of interest in this particular arbitration case, I am very impressed with the background of Mr. Etten as he has done extensive work regarding “bad faith” claims against insurance companies. Because of his excellent work in this field, I am contemplating contacting him with regard to potential “bad faith” claims that I may have against P&C Insurance Company and Tradewind Insurance Company, depending upon the outcome of this arbitration process.
Patrick K.S.L. Yim
On May 14, 1997, the former Bishop Estate trustees sought to have retired Circuit Judge Patrick Yim as fact-finder into allegations surrounding Kamehameha Schools.
On July 10, 1997, a court order was filed appointing Yim to conduct and begin an investigation.
On December 4, 1997, Judge Yim filed his “Final Report of Fact Finder”. In this official report, Mr. Yim writes:
II. BACKGROUND OF THE FACT FINDING PROCESS
On May 4, 1997, Kamehameha Schools Bishop Estate’s (“KSBE”) General Counsel, Nathan Aipa, Esq., first inquired as to Judge Patrick K.S.L. Yim’s (“Fact Finder” or “Yim”) availability to serve as a Fact Finder.....
Nathan Aipa was my direct superior at Bishop Estate/Kamehameha Schools, and was an officer for P&C Insurance Company.
Mr. Aipa also was directly involved in my termination from Kamehameha Schools, and he was a named Defendant in my RICO lawsuit.
In early 1998, the Star-Bulletin ran the following story:
Yim destroyed files on Kamehameha
by Rick Daysog
Court-appointed fact finder Patrick Yim told the state that he destroyed his files of interviews with Kamehameha Schools staffers, which were the basis for his highly critical report on the management of the Kapalama Heights campus.
A spokesman for one of the trustees said the destruction casts doubt on the credibility of the Yim report....
Doug Carlson, spokesman for [Trustee Lokelani] Lindsey, has criticized the Yim report as flawed, focusing on unsubstantiated rumors and innuendo. Yim’s destruction of the evidence makes it impossible to check if any of his conclusions are valid, Carlson said.
“This bizarre development is one more reason to cast doubt on the credibility of the fact finder’s report,” Carlson said....
I believe these factual objections offer further credence to my previous contentions that “it appears highly unlikely that an attorney can be found in Hawaii that would not have some relationship to one or more of the prominent parties named in my lawsuits.” I would hope, therefore, that the American Arbitration Association will also come to that conclusion and reconsider my request to appoint a qualified arbitrator from outside Bishop Estate’s considerable sphere of political and economic influence.
< END OF QUOTATION >
As further reference, I quote the following from my letter to the American Arbitration Association dated September 17, 2003:
This is in further response to Steven Guttman’s letter of September 15, 2003, in which he states, in part:
“With respect to the other substantive issues raised by Mr. Harmon in his Letters, we believe we have previously submitted our comments on these matters. Our reading of Mr. Harmon’s Letters is that he is attempting to explain why he disagrees with our commentary regarding his prior correspondence; he is not raising any new discussion points.”
If you will kindly refer back to Mr. Guttman’s letter dated August 25, 2003, you will find these comments:
“I reiterate my prior comments as to Mr. Harmon’s correspondence regarding Ms. Neustadter and the AAA proceeding with the arbitration. There is nothing in any of his letters which establishes that Ms. Neustadter has any conflict regarding this case.
“The objective reality that the Hale O Kaula case, referenced in letters from Mr. Harmon, has absolutely nothing to do with the parties to this arbitration or the claims being presented. Further, there is no correlation between the concern of Special Master Robert Richards quoted in Mr. Harmon’s August 23 letter and Ms. Neustadter serving as the arbitrator in this matter.”
The following is the true and factual “objective reality” in the Hale O Kaula case, as it relates to the connections between Colbert Matsumoto, Judith Neustadter and the Maui Planning Commission:
Colbert Matsumoto was the appointed Kamehameha Schools/Bishop Estate Master to whom I reported the wrongdoing at the Estate. I believe he was also the person largely responsible for the fact that the critical findings of Special Master Robert Richards were eventually discounted in favor of a report by the firm hired by Kamehameha Schools, Morgan, Lewis & Bockius.
Colbert Matsumoto is also now chairman of Island Insurance Company, Ltd., which is the company that defended me in Kamehameha Schools’ and P&C Insurance Company’s lawsuit against me. Island Insurance is also the company that has rejected my tender of defense in the current complaint regarding interpretation of the Settlement Agreement – an agreement that the attorney assigned to me by Island Insurance Co. helped negotiate.
Colbert Matsumoto also served as a member of the Department of Land and Natural Resources which administers state land use regulations working in conjunction with county regulators, including the Maui Land Use Commission, on which Ms. Neustadter serves.
In the April 18, 2002 issue of the Honolulu Advertiser, it was announced that five local investors were buying a minority stake in the Honolulu Star-Bulletin. The local investors were Colbert M. Matsumoto and Franklin M. Tokioka of Island Holdings, Inc. (parent of Island Insurance Co.) Duane K. Kurisu, partner in local real estate investment firm Kurisu & Fergus’ and the families of Warren K.K. Luke and Jeffrey Watanabe, a partner in the law firm of Watanage, Ing & Kawashima. This law firm was one of the key law firms hired by Kamehameha Schools and their role in the Kamehameha Schools alleged wrongdoing was prominently mentioned in the Richards’ Report, and in my own RICO lawsuit and my letters to Dr. McCubbin and the Kamehameha Schools’ trustees.
Colbert Matsumoto is also currently a director for the Honolulu Star-Bulletin. On July 7, 2003, the Star-Bulletin ran an editorial entitled “Feds shouldn’t meddle in local religion dispute,” which referred to the then-pending lawsuit regarding the Hale O Kaula church case against Maui County for denying it a permit to add a second floor to a building so it could be used as a chapel. A copy of the editorial is enclosed for your information....
These letters comprise part of my “letter writing campaign” that appears in Trustee Mary Lou Woo’s Complaint as Issue No. 5. I have referred to their location on the internet, rather than enclosing copies with this letter, due to their length. I expect that actual copies, however, will be included as part of the document exhibit to be prepared by Mr. Guttman....
< END OF QUOTATION >
My response to Mr. Guttman’s comment that “Mr. Harmon’s continued demands for information concerning the identity of the professional liability insurance providers used by the Trustee, Ms. Neustadter and my firm have no bearing whatsoever on the appointment and retention of Ms. Neustadter as the arbitrator or on any other issue raised in this arbitration,” is that his statement is patently untrue. Ms. Neustadter has already admitted, in her last Disclosure Statement, that one of the entities I listed in a previous letter was, in fact, her insurance broker. In my view, this is a clear conflict-of-interest on Ms. Neustadter’s part. Furthermore, as I also stated in a previous letter, if either Steven Guttman or Mary Lou Woo also have professional liability coverages through the same broker or insurance company, then there could be no doubt at all that all parties are conflicted in this case.
Mr. Guttman ends his letter by claiming that my “ongoing probes serve only to waste the time and resources of the Trustee.” I continue to maintain that it is the Trustee’s own denials of information and repeated claims that Ms. Neustadter has no conflicts-of-interests, that is wasting the time and resources of not only the Trustee, but also of the Respondent, all named Witnesses, and the American Arbitration Association itself.
Therefore, I again request that your office take into consideration the new information provided above, and that the AAA disqualify Judith Neustadter as the arbitrator in this case. As I have also requested in previous letters, I again ask that you immediately appoint Mr. Daniel Bent as her neutral replacement.
Thank you for your consideration.
Bobby N. Harmon
cc: Mary Lou Woo, Trustee, c/o Steven Guttman, Esq.
Kessner, Duca, Umebayashi, Bain & Matsunaga (via fax @ 808-529-7177)
bcc: John Goemans, Esq., P.O. Box 2849, Kamuela, HI 96743