Bobby N. Harmon, CPCU, ARM
January 17, 2005
VIA fax @ 808-523-6001
e-mail: mat@torkildson.com
Matt A. Tsukazaki, Esq.
Torkildson Katz Fonseca Jaffe Moore & Hetherington
AmFac Tower, Floor 15
700 Bishop Street
Honolulu, HI 96813
RE: Settlement, Release and Indemnification Agreement
Dear Mr. Tsukazaki:
This is to acknowledge receipt of your letter dated January 11, 2005, in which you state:
As you know, my law firm represents Kamehameha Schools in all matters that involve your former employment with Kamehameha Schools and the entry and enforcement of the Settlement, Release and Indemnification Agreement (the “Agreement”) between you and Kamehameha Schools. It has come to our attention that you have submitted an on-line Application for Employment for the position of Manager, Financial Risk, with Kamehameha Schools. As you are aware, the Section K of the Agreement provides:
NO RE-EMPLOYMENT
HARMON represents and agrees that he will not reapply for employment or otherwise seek reinstatement to any position with RELEASEES now or at any time in the future, and that if he does, RELEASEES may decide not to employ him pursuant to this AGREEMENT. RELEASOR understands and agrees that RELEASEES have no obligation, contractual or otherwise, to reinstate, re-employ, or hire him in the future or even consider any application made by him, and he will not assert any claim against RELEASEES for any failure to reinstate, re-employ, hire, or consider him for hire. While HARMON will not apply for employment, nothing herein prohibits KAMEHAMEHA SCHOOLS from deciding in its sole discretion to seek or not to seek HARMON’S services in the future.
The submittal of the on-line application is a breach of the Agreement. Please be informed that pursuant to the Agreement, Kamehameha Schools will not be processing your on-line application.
Finally, you are again instructed not to communicate directly with Kamehameha Schools and/or any of its Trustees, officers or employees about this matter. All correspondence from you on this matter should be directed to my attention at the address above. I note, however, that if you engage in an incessant letter writing campaign on this matter ignoring the express terms of the Agreement, as you have in the past, we respectfully reserve the right not to respond to your letters.
< END OF QUOTATION >
As you well know, Mr. Tsukazaki, over the past four years I have repeatedly asked you to provide me with written documentation that Torkildson, Katz, Fonseca, Moore & Hetherington legally represented Kamehameha Schools/Bishop Estate in “all matters” between me and Kamehameha Schools. Specifically, I have asked for copies of your Attorney-of-Record Agreements with Kamehameha Schools and their for-profit subsidiary, P&C Insurance Company, Inc. Also, I have repeatedly requested copies of any letters from the professional liability insurance carriers for Kamehameha Schools and P&C Insurance Company that would provide written evidence that your firm was legally authorized to negotiate the terms of the referenced Settlement, Release and Indemnification Agreement on behalf of these entities, as you have claimed.
Your firm has never provided such written documentation to me or to Trustee Mary Lou Woo, or to the American Arbitration Association’s appointed arbitrator in this case. The only excuse that I have ever been provided for NOT furnishing these documents came from Steven Guttman in his erroneous and non-professional statement to my former attorneys, Bradley Tamm, Greg Dunn and Arnold Phillips that he “presumed” that such letters would be “Attorney-Client privileged.” Therefore, I must again advise you that I cannot accept, on faith alone, your statement that you had the legal authority to negotiate and enforce the referenced Settlement, Release and Indemnification Agreement on behalf of Kamehameha Schools, P&C Insurance Company, Federal Insurance Company, and XL Insurance (Bermuda).
In addition, I have repeatedly requested the identities of the Interim Trustees who signed the Settlement Agreement as their signatures were illegible and no printed or typed names appeared with the signatures. Also, these signatures were not notarized, which has led me to question whether or not these signatures were forgeries. If you will refer back to my letter of November 24, 1997, addressed to Bishop Estate Master Colbert M. Matsumoto, Esq., I described the following illegal practice regarding the signing of documents by the Trustees:
There was coercion of employees, by means of threats of discipline or termination, to violate laws or to “look the other way” while superiors engaged in illegal or unethical acts, such as: the altering and/or falsifying of staff reports and contracts; directing notaries public to notarize documents without witnessing the signatures or the signatories personally signing the notary logs; collusion with independent contractors to conceal and cover-up wrongful acts; discriminatory practices in hiring; and misuse of the “attorney-client privilege” to prevent the disclosure of these acts.
< END OF QUOTATION >
As you should know, Mr. Tsukazaki, a contract is not valid, or enforceable, if fraud is involved (such as forged signatures), or if it was entered into for illegal purposes.
Furthermore, I have repeatedly questioned the obvious fact that your firm had, and continues to have, a conflict-of-interest in this case due to the fact that you were also a co-defendant in my RICO lawsuit. As I have pointed out in my Response to Steven Guttman’s Second Supplemental Request for Compensation and Fees, filed with the U.S. Bankruptcy Court on December 23, 2004:
The sole witness for Claimant at the Arbitration Hearing, Kamehameha Schools’ in-house counsel Louanne Kam, admitted that she had advised the estate’s Trustees that my claims lacked legal merit and that she had not reported them to the professional liability insurance carriers for Kamehameha Schools and P&C Insurance. I maintain that Louanne Kam does not have the responsibility, or the authority, in this case to decide, on behalf of any insurance carrier, whether or not a claim has merit, or whether or not the claim should be reported to their insurance company. This non-reporting of claims by the Legal Department of Kamehameha Schools to their insurance carriers has previously resulted in losses of millions of dollars to the Estate due to later denials by the insurance companies for violating the claims reporting provisions of the insurance policies. This became a major issue in the Attorney General’s lawsuit to remove the former trustees, and was described in detail in my RICO lawsuit. Despite the Claimant’s knowledge of Kamehameha Schools’ alleged violations of the reporting provisions in their insurance policies, Mary Lou Woo and Steven Guttman proceeded to negotiate settlement of the underlying lawsuits with the very attorneys named in my RICO lawsuit, without verifying that these attorneys had been authorized to act on behalf of the insurance companies - Federal and XL - which provided the professional liability insurance coverages to KSBE and P&C in this case. The Claimant, Steven Guttman, and the attorneys who purported to represent Kamehameha Schools and P&C Insurance Company in the RICO case, have repeatedly denied my requests to provide Attorney of Record letters evidencing the fact that they were actually authorized to represent these entities, and for written evidence that their representation was authorized by Kamehameha Schools’ and P&C’s insurance carriers. In actuality, the settlement negotiations were largely conducted behind closed doors between Steven Guttman and Matt Tsukazaki. It was a major error and omission on the part of Trustee Woo and Guttman that they did not bring all involved parties to the negotiating table - including the claims representative for the insurance company - to participate in the settlement negotiations. In addition, the principal entity that negotiated the Settlement, and drafted the Settlement Agreement, was the Torkildson Katz law firm, which was a named Defendant in the RICO lawsuit, and which was represented by Robert Katz in that case. From my years of experience in the insurance business, no insurance company would ever permit its insured to represent themselves in a lawsuit. Nor would any insurance company ever allow a co-defendant in a lawsuit to represent their insured. These facts clearly demonstrate that this firm had multiple conflicts of interests in this case, and fraudulently misrepresented to Harmon and to the court that they had the authority to act on behalf of Federal Insurance Company and XL Insurance Company to negotiate a settlement in this case. Respondent also believes that this failure to include all involved parties in the settlement negotiations was a major breach of the fiduciary duties of the Trustee to collect all monies due the Bankruptcy Estate for the benefit of its creditors as well as the benefit of the debtor.
Mr. Tsukazaki, if you indeed represented these entities, as you claim, and if you were responsible for the negotiations of the Settlement, Release and Indemnification Agreement and for its “entry and enforcement,” as you claim, then I would certainly recommend that you immediately relay a copy of this letter to your Professional Liability Insurance carrier, and request that they contact me for further details regarding my claims which I do not wish to make public at this time.
As I have had to act as my own attorney in this matter after the untimely withdrawal of my attorneys Bradley Tamm and Greg Dunn, I would ask that you treat my requests for information with the same courtesy and response as you would an attorney. Therefore, I must again request that you provide to me, as soon as possible, the following information and documentation on behalf of your clients as well as your law firm:
1. An explanation of why you have not responded, on behalf of Kamehameha Schools and P&C Insurance Company, to my many Notice of Claim letters addressed to your attention, the latest one being dated December 15, 2004.
2. The identities of all three Interim Trustees who purportedly signed the referenced Settlement Agreement, and a written verification by each of them that these were their authentic signatures.
3. A copy of Exhibit 5 of the Settlement Agreement that was not attached to the original document at the time of my signing, and which was not attached to the copy provided to the Arbitrator for the arbitration hearings in which Louanne Kam appeared as Trustee Mary Lou Woo’s sole witness, and you appeared as Kamehameha Schools’ attorney. I am of the belief that this omission of Exhibit 5 from the Agreement was, in itself, a breach of the contract which states in Paragraph 3, Page 14:
“Alteration of the AGREEMENT. This AGREEMENT shall not be altered, amended, modified or otherwise changed in any way or respect whatsoever, except in a writing, duly executed by all the parties...”
I maintain that Exhibit 5 was added AFTER I had signed the AGREEMENT, and that this modification was a breach of the terms of the contract. I also maintain that since a copy of this document was not furnished to the Arbitrator, despite my repeated requests that a copy be provided, Judith Neustadter Fuqua was not presented with all the relevant FACTS in the Arbitration proceedings.
4. A copy of the “side letter” between Federal Insurance Company, and unnamed parties, which was described in Steven Guttman’s letter dated June 2, 2000, addressed to my attorney Arnold T. Phillips II, as follows:
...” Your letter asked for a settlement statement. Mr. Harmon had requested copies of the settlement checks. As to the former, the settlement agreement has the total amount being paid and except as to the $------ paid over to your client this morning pursuant to his exemption claim, the balance is with the Trustee, subject to appropriate court orders for distribution. As of this date, Federal Insurance has not fully paid its portion of the settlement. Based on communications from Jeff Sia, my impression is that you are aware of the issue they have raised and the coordination being done by Bob Katz as to the resolution of the issue. I have confirmed with Lissa Andrews that she has received the check from her client and is authorized to issue it upon receiving the fully signed side letter [emphasis added]. I am uncertain as to who has been requested to sign the side letter and of those individuals, who has not signed off on it. If the matter of the remaining payment is not resolved soon, the Trustee is prepared to file the appropriate motion with the Bankruptcy Court. As to producing copies of the checks, I will take another look at the confidentiality provision. I know that until we started to receive payments, we did not know the specific payment allocation among the parties....”
I am of the belief that this “side letter” with Federal Insurance Company was, in itself, a breach of the contract which states in Paragraph 14, Page 16:
“Entire Agreement. This AGREEMENT is intended to be a fully integrated agreement and therefore contains all of the terms and agreements agreed upon between the Parties and supersedes and cancels each and every other prior conflicting agreement, promise and/or negotiations between them. Moreover, the terms of this AGREEMENT are contractual and not a mere recital.”
5. A listing of the insurance carriers, policy numbers, policy periods, dates claims were made, claim numbers, and names of their authorized Claims Adjusters for Kamehameha Schools, P&C Insurance Company, Inc., Marsh & McLennan; Federal Insurance Company, Inc., PricewaterhouseCoopers, and Torkildson, Katz, Fonseca, Moore & Hetherington, in my RICO case.
6. A copy of the Indemnity and Hold Harmless Agreement that I signed with P&C Insurance Company, Inc. upon being appointed as President of that for-profit corporation.
I refer you to the following web addresses for additional related information:
www.the-catbird-seat.net/Apollo.htm
www.the-catbird-seat.net/Bishop.htm
www.the-catbird-seat.net/Claims-By-Harmon.htm
www.the-catbird-seat.net/Aon.htm
www.the-catbird-seat.net/AIG.htm
www.the-catbird-seat.net/AlliedWorldAssurance.htm
www.the-catbird-seat.net/BuzzardsOfParadise.htm
www.the-catbird-seat.net/ChubbGroup.htm
www.the-catbird-seat.net/GoldmanSachs.htm
www.the-catbird-seat.net/Investcorp.htm
www.the-catbird-seat.net/Ko-Olina.htm
www.the-catbird-seat.net/MarshBirds.htm
www.the-catbird-seat.net/Prudential.htm
www.the-catbird-seat.net/RICO-BH.htm
www.the-catbird-seat.net/TheMeadows.htm
www.the-catbird-seat.net/Travelers-St-Paul.htm
Due to the complexity of this case, the large number of parties involved, and the recent civil and criminal charges filed against Marsh & McLennan, Inc., Aon, Ace, St. Paul Travelers, and other insurance companies for fraud, bid-rigging, and “kick-backs” of the type I have described in my RICO lawsuit and my claims letters, I would again ask that you present to the Trustees and Management of Kamehameha Schools and P&C Insurance Company, and to their insurance carriers, my offer simply to attempt a negotiated settlement of all unresolved claims, rather than continuing indefinitely with this costly and time-consuming litigation.
Since the date of this Hearing is January 19, 2004, your prompt response indicating whether or not Kamehameha Schools and P&C Insurance Company would be willing to consider my proposed out-of-court settlement negotiations is requested.
Very truly yours,
Bobby N. Harmon, CPCU, ARM
cc: Michael G. Cherkasky, President and Chief Executive Officer
Marsh & McLennan Companies, Inc.
(via fax @ 212-345-4838)
John D. Finnegan, President and Chief Executive Officer
The Chubb Corporation
(via fax @ 908-903-2027 and Email: info@chubb.com)
William K. Slate II, President/CEO, American Arbitration Association
(via fax @ 212-716-5905 and Email: Websitemail@adr.org)
Mark Appel, Senior Vice President
International Centre for Dispute Resolution
(via e-mail: AppelM@adr.org)
Harry Kaminsky, Vice President
Neutrals’ Services, Phoenix, AZ
(via e-mail: KaminskyH@adr.org)
James B. Farris, Senior Case Manager, American Arbitration Association
(via fax @ 559-490-1919 and e-mail: Farrisj@adr.org)
Mary Lou Woo, c/o Steven Guttman, Kessner Duca Umebayashi, et al.
(via fax @ 808-529-7177 and e-mail: sguttman@kdubm.com)
Mark Bennett, Attorney General, State of Hawaii
(via fax @ 808- 586-1239 and e-mail: hawaiiag@hawaii.gov )
Eliot Spitzer, Attorney General, State of New York
(via e-mail - www.oag.state.ny.us )
Dee Jay Mailer, CEO, Kamehameha Schools (via fax @ 808-523-6313)
P&C Insurance Co., Inc. (via fax @ 808-523-6313)
Governor Linda Lingle, State of Hawaii (via fax @ 808-586-0006)
Hugh Jones, Deputy Attorney General (via fax @ 808-586-1477)
J.P. Schmidt, Hawaii Insurance Commissioner (via fax @ 808-586-2806)
Janet Hughes, Internal Revenue Service (via fax @ 303-844-3596)
Billy Beaver, Pension & Welfare Benefit Admin. (via fax @ 626-229-1098)
Ralph F. Boyd, Jr., U.S. Dept. of Justice (via fax @ 202-514-1116)
Lyn Flanigan Anzai, Hawaii State Bar Association (via e-mail: lanzai@hsba.org)
Susan Tius, Esq., c/o Rush Moore Craven Sutton Morry & Beh
(via fax @ 808-521-0597)
Gerard Jervis, Lokelani Lindsey, Henry Peters, Oswald Stender, and Richard Wong, c/o Kenneth Hipp, Esq., Marr Hipp Jones & Pepper
(via fax @ 808-536-6700)
Jeffrey H.K. Sia, Esq., Ayabe Chong Nishimoto Sia & Nakamura
(via fax @ 808-526-3491)
Robert S. Tameler, ALPS, Claims Admin for Bradley Tamm and Greg Dunn
(via fax @ 406-728-7416)
Michael F. Perlis, Esq., Stroock & Stroock & Lavan, LLP, Atty for Federal Ins Co
(via fax @ 310-556-5959)
Mike Coulter, Deputy Managing Director, Aon Insurance Managers
(via fax @ 808-540-4301 and e-mail: mike_coulter@agl.aon.com)
Casimer Fidele, Tradewind Insurance Company
(via fax @ 808-521-7489)
PricewaterhouseCoopers, c/o Warren Price III, Esq.
(via fax @ 808-533-0549)
Terry Mullen, CEO/Pres., John Mullen & Co.
(via fax @ 808-531-0053)
References:
www.the-catbird-seat.net/BK-Objection-1-19-5.htm
www.the-catbird-seat.net/AAA-Dec-SG-re-fees.pdf
www.the-catbird-seat.net/AAA-Guttman-Att-A.pdf