BUZZARDS ON THE BAR
Scary Attorney Stories
Sightings from The Catbird Seat
~ o ~
From Spoon River Anthology -
John M. Church
- - -
I was attorney for the “Q”
And the Indemnity Company which insured
The owners of the mine.
I pulled the wires with judge and jury,
And the upper courts, to beat the claims
Of the crippled, the widow and orphan,
And made a fortune thereat.
The bar association sang my praises
In a high-flown resolution.
And the floral tributes were many –
But the rats devoured my heart
And a snake made a nest in my skull.
– Edgar Lee Masters, 1915
April 15, 2010
CALA criticizes attorney's mine disaster ad
By John O'Brien - Kanawha Bureau
CHARLESTON -- A legal reform group is criticizing the timing of an attorney's
advertisement in the wake of the recent Raleigh County mine tragedy, while the
attorney says he was simply trying to give a helping hand.
Mark Underwood took out an ad targeting those affected by the explosion at
Massey Energy-owned Upper Big Branch mine that killed 29 miners. The ad says
in large letters, "The real tragedy of the Massey mine disaster is that it should
have been prevented."
Richie Heath, executive director of West Virginia Citizens Against Lawsuit Abuse,
said time should be spent mourning and assessing what happened.
"It's a shame that, in the wake of this horrible tragedy, a few greedy personal
injury lawyers didn't even have the respect to wait for the last of the fallen miners
to be recovered before they started jockeying for the chance at a big payday,"
Underwood said time is of the essence in cases like these. He has handled the
cases of coal miners and their families before.
"Massey's not sitting around twiddling their thumbs," he said. "They're getting
their defense together."
The ad includes the number of citations the mine has received this year and
urges those affected not to be talked into a "quick settlement" by Massey.
Underwood's grandfather lost his life in a coal mining accident in Fayette County
before he was born. A corner was set aside in his house growing up for his
"Everybody's entitled to their opinion, but CALA's... the mouthpiece for
corporations that do this sort of stuff," Underwood said.
"It won't deter us from doing what we can to try to get to the truth."
Underwood said he hasn't retained any clients yet.
"We're more concerned with letting them know we're here," he said, "and letting
them know that while we can't imagine everything they are going through, we
sympathize with them."
Heath said it isn't the first time West Virginians have dealt with "questionable
ambulance-chasing" by attorneys after a tragedy.
Tim Bailey raised a few eyebrows when he was asked by several media outlets to
be an analyst after the Sago mine tragedy of 2006. Bailey traveled from
Charleston to Upshur County for the work but said he never directly contacted
any of the victims' family members.
"I promise you this: If I learned of anyone who would do that, I would be the first
one down at the ethics board. That means out-of-state attorneys, too," said
Bailey, now president of West Virginia's trial lawyers organization.
Bailey did end up representing some of those affected by the disaster but there
were no ethics questions.
"WV CALA encourages individuals and lawyers to report any unethical conduct to
the State Bar's lawyer disciplinary board, and urges legislators to address this
issue so that family members can have an adequate period to mourn their loss,"
The West Virginia Record
August 27, 2002
AND PUBLIC SAFETY
By Ken Paulson, Gannett News Service
The writer is executive director of the First Amendment Center with offices in
Arlington, Va. and Nashville, Tenn.
I must have missed a course in law school.
At the University of Illinois College of Law, I studied contracts, constitutional law
and property transactions. But I must have overlooked “Secret Settlements 101.”
Some law schools must be teaching it. Lawyers nationwide have grown
accustomed to settling lawsuits with the understanding that there’ll be no public
disclosure of the outcome.
It’s easy to understand the appeal of secret settlements to defendants and
plaintiffs, particularly in personal injury cases. A bicycle manufacturer who
constructs faulty bikes doesn’t want the world to know about his defective
products. He also doesn’t want negative publicity that could affect sales of his
other bikes. Plaintiffs can get a larger settlement by promising not to disclose the
large sum they’ve been paid. A judge – eager to clear the docket – blesses the
agreement. In this scenario, the plaintiff is compensated, the defendant is spared
embarrassment or scorn and the public is left in the dark.
There’s a long and ugly history of secret settlements in which disclosure would
have alerted the public to serious, ongoing dangers:
>> Eleven former employees of the John-Manville Co. filed suit in 1933 claiming
that their work had caused asbestosis. The company agreed to pay off the
claims, but the secret settlement would not be disclosed for more than 40
years, according to the Coalition for Consumer Rights.
“One can only guess what would have happened if the original 1933 settlement
had been made public,” the coalition noted in a report.
“If the hazards of asbestos had been known during the Great Depression, a
generation of workers could have been spared horrible respiratory
>> Also kept from the public for years were settlements in lawsuits that alleged
that Ford pickup trucks were defective, slipping from park to reverse.
The defect allegedly caused more than 200 deaths and 4,600 injuries.
>> Over 10 years, about 100 lawsuits were filed alleging that Firestone
manufactured unsafe tires for the Ford Exployer. The National Highway Traffic
Safety Administration says 148 deaths and more than 500 injuries may have
been caused by these tire tread separations.
Secret settlements hid the potentially lethal problem from the public for years.
>> Amid the recent wave of sexual abuse allegations against priests, it also has
been revealed this year that the Catholic Church insisted on secret settlements is
cases stretching back to 1985. . . .
These abuses have not gone unnoticed. Some have taken significant steps
toward reform, most recently in South Carolina where all 10 federal judges voted
for a total ban on sealed, court-approved settlements. Echoing the federal
judges’ concerns, South Carolina Supreme Court Chief Justice Jean Toal is now
asking state judges to take a close look at secret settlements.
The Association of Trial Lawyers of America aggressively has promoted
legislation that would limit secret settlements. Opponents of these bills argue for
the need to protect trade secrets and patient privacy, but judges have the tools to
address these issues without sealing the entire record. Arkansas, Florida,
Louisiana, Washington and Virginia are among states that currently limit secret
settlements when there are public safety considerations.
This kind of reform is long overdue. It’s unconscionable to take a lawsuit – filed in
public courts, processed by public employees and heard by judges on the public
payroll – and seal it for the convenience of the litigants.
Public safety is never a private matter.
* * *
August 27, 2002
Ford Wins Dismissal of
By Danny Hakim, The New York Times
DETROIT – A sexual-harassment lawsuit against Ford Motor Co. was dismissed
because the plaintiff and her attorneys had discussed with reporters evidence
that the Michigan court deemed inadmissible. Much of the information was a
matter of public record.
The suit was dismissed last week by Circuit Court Judge William J. Glovan,
who ruled the plaintiff, Justine Maldonado, and her attorney had disseminated
information about a defendant’s previous conviction in an attempt to prejudice
potential jurors, and in violation of a Michigan law.
“The behavior in question has been intentional, premeditated and intransigent.”
the judge wrote in his dismissal. “It was designed to reach the farthest
boundaries of the public consciousness.”
Some legal experts said the finding was highly unusual, particularly in its
implications for the right of a plaintiff in a harassment case to speak freely.
Courts typically use the screening process during jury selection to resolve
concerns about what jurors know.
“I don’t know why it should be that the woman who was the alleged victim of the
sex harassment can’t continue to talk about in,” said Herschel Fink, a lawyer who
specializes in First Amendment issues. “I believe as a matter of First Amendment
law, she has a right to talk about it.”
Miranda Massie, Maldonado’s lawyer, said: “Women have the right to talk about
abuse. That’s what this comes down to.”
The harassment case was filed two years ago by Maldonado, an inspector at the
Wixom, Mich., assembly plant, against Ford and a supervisor, Daniel P. Bennett.
Maldonado is one of four women who have sued Ford related to accusations
against Bennett. Three of the suits have been dismissed, though Maldonado said
she plans to appeal and another plaintiff already has.
Maldonado contended in her suit that Bennett exposed himself to her many
times, demanded oral sex and followed her home.
Ford executives said their investigation of the case concluded that Maldonado’s
accusations, and those of the three other women, were without merit.
Part of the company’s legal strategy has been to seek a dismissal of Maldonado’s
case on the grounds that she and her lawyer prejudiced potential jurors by talking
about Dennett’s conviction in 1995 on charges of exposing himself to three young
women. The conviction was expunged from his record last year, as is
permissible under Michigan law for meeting various good behavior
THE NEW TESTAMENT
THE GOSPEL ACCORDING TO LUKE
Luke 11 (King James Version)
And it came to pass, that, as he was praying in a certain place, when he ceased,
one of his disciples said unto him, Lord, teach us to pray, as John also taught his
And he said unto them, When ye pray, say, Our Father which art in heaven,
Hallowed be thy name. Thy kingdom come. Thy will be done, as in heaven, so in
Give us day by day our daily bread.
And forgive us our sins; for we also forgive every one that is indebted to us. And
lead us not into temptation; but deliver us from evil....
~ ~ ~
And as he spake, a certain Pharisee besought him to dine with him: and he went
in, and sat down to meat...
~ ~ ~
Woe unto you, Pharisees! for ye love the uppermost seats in the synagogues,
and greetings in the markets.
Woe unto you, scribes and Pharisees, hypocrites! for ye are as graves which
appear not, and the men that walk over them are not aware of them.
Then answered one of the lawyers, and said unto him, Master, thus saying thou
reproachest us also.
And he said, Woe unto you also, ye lawyers! for ye lade men with burdens
grievous to be borne, and ye yourselves touch not the burdens with one of your
Woe unto you! for ye build the sepulchres of the prophets, and your fathers killed
Truly ye bear witness that ye allow the deeds of your fathers: for they indeed
killed them, and ye build their sepulchres.
Therefore also said the wisdom of God, I will send them prophets and apostles,
and some of them they shall slay and persecute:
That the blood of all the prophets, which was shed from the foundation of the
world, may be required of this generation;
From the blood of Abel unto the blood of Zacharias which perished between the
altar and the temple: verily I say unto you, It shall be required of this generation.
Woe unto you, lawyers! for ye have taken away the key of knowledge: ye
entered not in yourselves, and them that were entering in ye hindered.
And as he said these things unto them, the scribes and the Pharisees began to
urge him vehemently, and to provoke him to speak of many things:
Laying wait for him, and seeking to catch something out of his mouth, that they
might accuse him.
NOW, FOR YOU YOUNG BIRD-WATCHERS WHO STILL THINK THAT
ENRON, GLOBAL CROSSING, WORLDCOM, IMCLONE, AND OTHER
CORPORATIONS THAT ARE CURRENTLY FEELING THE HEAT OF
CORPORATE HELL, ARE A NEW PHENOMENA . . .
The Beebe Network -
The Cast Of Characters and The History
Ben Barnes, former Texas Lt. Governor; business associate of Herman K
Beebe, Walter Mischer and John Connally.
Herman K. Beebe Sr., Louisiana financier with offices in Dallas, convicted felon
and Mafia associate; many connections to the intelligence community; godfather
of the dirty Texas S&L's; did nine months in Club Fed.
Charles Hurwitz introduced Beebe to B G Wylie, half-brother of Carroll Kelly;
funded start-up of Contra-related Palmer NB.
Tom Benson, a partner of Stanley Rosenberg in Groos Bank (influenced by H
K Beebe) and Bank of Leon Springs; a Beebe associate; partner with Peyton
McKnight and Charles Hurwitz(?) in Culebra/1676, a Rosenberg boondoggle.
John Connally, former Texas governor; Connally's law firm, Vinson-Elkins had
Walter Mischer as a client; Charles Keating worked on his 1980 Republican
presidential race; he and his partner Ben Barnes, borrowed tens of millions of
dollars from dirty S&L's; served on Hurwitz's Maxxam Inc's board of directors
from 1988 until his death in 1993. Participated in several CIA related covert
Thomas Gaubert, big Democratic fundraiser from Dallas; former head of
Independent American Savings, which purchased 20 branch offices from
Hurwitz' USAT; owned a piece of Sandia Federal Savings in Albuquerque; head
of Telecom; A right-wing flag waver.
Joseph Grosz, Chicago mob associate; worked for Gouletas family; ran
Southmark's San Jacinto Savings; director of Gaubert's Telecom.
Stefan Halper, co-founder with fellow George Bush supporter Harvey McLean
of Palmer National Bank, which was financed by H K Beebe and funneled private
donations to the Contras; former son-in-law of past CIA deputy director Ray
Cline; helped set up legal defense fund for Oliver North.
Peter Munk also an investor in Palmer NB.
J B Haralson, former head of Mercury Savings and Ben Milan Savings, where
he was fronting for his old associate George Aubin; old Surety Savings hand,
which Hurwitz attempted buy in 1977; managing officer of two other Texas S&L's
which that failed; partner of B G Wylie et al in the purchase of Brazaport S&L
from Lloyd Bentsen.
Charles Hurwitz, controlled now defunct USAT, majority stockholder of Maxxam
Inc; longtime friend of most Houston elite including John Connally; a Milken
Insider; often accused of fraud and other security related schemes; knew H K
Charles Keating, S&L looter; spawned by Carl Lindner; worked on John
Connally's 1980 presidential campaign as Westcoast fundraiser; controlled
Lincoln Savings and Loan (the first big deal Lincoln did was with Connally);
Lincoln involved in a daisy chain with Larry Mizel's MDC Holdings, Silverado
and San Jacinto; his chief pilot in 1979 was CIA operative Ken Qualls.
Carroll Kelly, who epitomized his Kappa Sigma fraternity; owner of Continental
Savings and associate of H K Beebe (I'm Beebe's man in Texas," he bragged to
Ed McBirney, "Fast Eddie" from Dallas; former head of Sunbelt Savings;
associate of H K Beebe, Jarrett Woods and George Aubin; attempted to buy
branch offices from Hurwitz' USAT; funded Hurwitz associates including
Peyton McKnight, powerful Louisianan, an associate of Beebe and a partner
with Charles Hurwitz, Stanley Rosenberg and Tom Benson in a Rosenberg
Harvey McLean, Shreveport, Louisiana businessman and close associate of H K
Beebe; owned Paris (Texas) Savings and Loan; co-founded Palmer National
Bank with Stephan Halper and Beebe's money.
Peter Munk, a Canadian businessman, investor in Palmer NB; an associate of H
K Beebe; business partner with Adnan Khashoggi; an associate of John H
Roberts Jr and John P Holmes Jr in Goldome FSB.
Clint Murchison Sr. and Jr., Dallas oilmen and wheeler dealers; Sr was involved
in business in Haiti with a CIA operative; Jr purchased Mischer's interest in
sawmills in Honduras; Jr was involved with a CIA operative in Libya and did
business with H K Beebe and Adnan Khashoggi.
David Saks, business associate of Stanley Rosenberg; partner of Doyle Spruil,
both convicted felons; borrowed from Beebe controlled S&L's.
Doyle Spruil, business partner of David Saks and Stanley Rosenberg; a
convicted felon; borrowed from Beebe controlled S&L's Beebe connections to
Barnes-Connally, to Hurwitz, to S&L's, to Mafia CONNALLY-KEATING-LINDNER- BARNES-BEEBE. (Source: References are in "Inside Job")
~ ~ ~
Beebe connections to Barnes-Connally,
to Hurwitz, to S&L's, to Mafia
(Source: References are in "Inside Job")
Beebe starts American Motels, Inc. (AMI); invests in Holiday Inns.
Beebe & Barnes develop complex business association.
Beebe controls Bossier Bank & Trust, Bossier City, CA.
Barnes invests in Holiday Inns.
Barnes, then Lt. Gov. of TX, involved in Bank & stock fraud scandal. In '71 a grp
of TX banks looted a network of businessmen who bought & sold stock in a
business owned by Frank Sharp.
Connally bribe to cover indictment led to indictment of Connally; acquitted.
Jul. - Beebe & Barnes from banking and insurance assoc. by 1976 B/B control
19 banks & S&L's in TX & CA
Lindner's American Financial Corp. (AFC); also a founding partner in AFC's
law firm Keating, Muething & Klekamp.
Lee H. Henkel, a Republican, was Treasury Dept. & IRS Counsel in the Nixon
Administration. Later a tax attorney and real estate developer in Atlanta.
Jul. 02 - SEC v. Keating, Muething & Klekamp a judgment against Lindner,
Keating & Klekamp enjoins self-dealing in an Ohio bank subsidiary.
Keating buys Continental Homes of Phoenix, Inc. from Lindner & renames it
American Continental Corp. (ACC)
Henkel & Keating are Connally for Presidents' East & West Coast financial
chairs. Henkel is Keating's attorney.
Oct. - ACC buys Lincoln Savings with DBL issued junk bonds
Lincoln makes $70mm loan to Connally on a land deal near Austin, TX and
$134mm loan to Henkel; Connally defaulted leaving Lincoln (and not the
taxpayers) holding a $70mm loss (Nation 11/19/90)
Herman Beebe associate Ben Barnes in partnership with Connally borrows
from 17 S&L's in 3 states ($40mm from Vernon S&L and some unknown amount
from Credit Banc (where Barnes' son worked)
ACC employed Mark Connally son of John Connally
Aug. - Press reports Beebe & Marcelolo control Continental S&L (Houston).
Fails in 1988.
Feb. 13 - WSJ reports Lincoln S&L made at least $61.9 million in loans to
corporations & partnerships in which Lee Henkel had an interest
In mid-August 1987 the records of Southmark, San Jacinto SA, Strauss,
Barnes, Connally and about 200 others were seized according to the Dallas
Times Herald. Southmark had done about $90 million in business with Beebe
who held 62% of its Series E Pfd according to Southmarks 10K85. Southmark
bought Beebe's nursing homes and also owned 37% of Pratt Hotels. Beebe did
business with Morris Shenker and also was related to many Contra figures.
Southmark also purchased the Beebe built AMI tower in or before 1988. AMI had
17 subs and 14 affiliates.
SEC v. MDC Holdings, MDC (has close ties with Silverado), is caught in shady
deal with Lincoln S&L.
Neal Bush is loaned $550m for a house
Connally elected to Maxxam BOD. . . .
The above two articles were located by a Google search for Lee H. Henkel,
... partner in AFC's law firm Keating, Muething & Klekamp, Lee H. Henkel, a
Republican, was Treasury Dept. & IRS Counsel in the Nixon Admin. Later a tax
... Muething & Klekamp. Lee H. Henkel, a Republican, was Treasury Dept. & IRS
Counsel in the Nixon Admin. Later a tax attorney and real estate developer in
For more on Lee H. Henkel, GO TO > > > Dirty Money, Dirty Politics & Bishop
For more on Maxxam, GO TO > > > Heavens and Earth
February 29, 2000
Pluck, leaks helped McCain
to overcome S&L scandal
By Walter V. Robinson, Globe Staff
A decade ago, Senator John McCain's role in the most politically corrosive
episode of the $150 billion savings and loan debacle threatened to end a
political career that now holds some promise of concluding instead with a McCain
Back then, McCain said the Keating Five scandal was a more nightmarish
experience than his years in a North Vietnamese prison camp.
What a difference a decade makes: One mischievous commentator recently
suggested that the Keating Five was a rock group. And nowadays, McCain
dismisses the tawdry Senate scandal as a mere asterisk in his career, in hopes
the electorate will too. . . .
He was a close friend and early congressional ally of Charles H. Keating Jr. -
the figure at the core of scandal - and one of the leading beneficiaries of
Keating's political and personal largesse. Yet, he benefited from decisions by the
Senate Ethics Committee that minimized his culpability and the resulting
And there is evidence that McCain averted major damage to his public image
with well-choreographed news leaks from his office that undermined three of the
four other senators caught up in the controversy. In 1992, McCain denied under
oath that he or his aides had anything to do with the leaks.
The scandal's raw content is unflattering: McCain and four other senators -
indelibly known ever since as the Keating Five - pressuring federal regulators on
behalf of Keating, a prodigious fund-raiser and owner of the Lincoln Savings &
Loan Association. His bank's subsequent $3.4 billion failure made Keating the
most enduring symbol of the devil-may-care S&L excesses of the 1980s.
To be sure, the record shows that McCain did less for Keating than most of the
others, and abandoned Keating the moment he learned there might be criminal
charges against his friend. The Senate Ethics Committee gave McCain, along
with Senator John Glenn, the lightest of reprimands, saying they displayed ''poor
judgment'' for going to two meetings with banking regulators. . . .
But in an interview this month, Clark B. Hall, a former FBI agent and
congressional investigator who led the GAO investigation, told the Globe he had
no doubt, after doing scores of interviews and obtaining documentary evidence,
that McCain was one of the principal leakers. But Hall said the Ethics Committee
''smoothed it over.''
''You don't betray other people to protect yourself, and that's what he was doing,''
Hall said. ''And he was breaking Senate rules to do it.'' The targets of the leaks
were Democrats Dennis DeConcini of Arizona, Alan Cranston of California, and
Donald Riegle of Michigan. (In the end, DeConcini and Riegle would be sharply
criticized by the committee; Cranston drew a formal reprimand.) . . .
A pugnacious strategy
From the beginning, Keating also adopted a pugnacious strategy in his attempts
to outfox, intimidate, and even seize control of the federal regulatory apparatus
that sniffed big trouble in the way his Lincoln Savings & Loan Association was
lending depositors' money for risky ventures. Many of the loans were for real
estate developments by Keating's Phoenix-based American Continental Corp.,
which purchased the California-based Lincoln S&L in 1984.
As federal banking regulators closed in, Keating deployed powerful allies against
them. He raised enormous sums for members of Congress - $1.3 million for the
five senators alone, $112,000 of that for McCain's campaigns. He and his
lobbyists prevailed on McCain and others to write letters and support
congressional resolutions condemning Federal Home Loan Bank Board
regulations that would restrict risky direct investments like those Lincoln's
deposits were used for.
In 1989, Keating himself left no doubt that the campaign funds he lavished on the
five senators were designed to produce results, when he declared to reporters:
''One question, among the many others raised in recent weeks, had to do with
whether my financial support in any way influenced several political figures to
take up my cause. I want to say in the most forceful way I can: I certainly hope
Months before he pushed the five senators to meet with regulators, Keating even
sought to seize control of the bank board by asking his congressional allies to
support two of his choices for the three-member board that was overseeing the
investigation of Lincoln. One of the two, Lee H. Henkel Jr., was appointed to the
board in November 1986.
During the Ethics Committee investigation, one of the leaked stories that
benefited McCain reported that DeConcini and Riegle, at Keating's behest, had
lobbied the White House for Henkel's appointment. But in a little noticed finding
in its final report, the committee reported that McCain had, too.
Alone among the five senators, McCain counted Keating as a personal friend;
their families vacationed together from 1983 to 1986 - the four years McCain
served in the House - flying to Keating's private retreat in the Bahamas aboard
corporate aircraft paid for by Keating's company.
In 1986, McCain's wife, Cindy, and her father, James W. Hensley, also invested
$359,100 in a Phoenix shopping mall developed by a subsidiary of Keating's
American Continental Corp.
When the scandal became public, and along with it his family's personal and
business links to Keating, McCain reimbursed Keating $13,433 for the flights and
vacations. By not reporting them and reimbursing Keating at the time they
occurred, McCain had violated House ethics rules. (He was elected to the Senate
But the Senate Ethics Committee decided that the vacation subsidies were
House matters - outside its jurisdiction. The committee did not consider the mall
investment germane. Nor was it troubled by McCain's lobbying for Henkel.
With public hearings looming, the bipartisan panel - three members from each
party - split over whether to follow the urging of its counsel, Robert M. Bennett,
that the case against McCain and Glenn be dropped. The committee Democrats
resisted, and McCain has long insisted they did so because he was the sole
Republican among the five and they feared that a pared-down ''Keating Three''
would be recast as a Democratic scandal.
Most important, the committee concluded it was not improper for five senators to
seek two separate meetings with regulators, even though Keating orchestrated
the April 1987 meetings. The first meeting was with bank board chairman Edwin
J. Gray, at a time when Gray was seeking Senate approval for a $15 billion
bailout bill to rescue hundreds of failing thrifts. Gray was summoned to a meeting
in DeConcini's office and told to come alone. The second meeting, a week later,
was with regulators who were directly overseeing the investigation.
Fred Wertheimer, then president of Common Cause, which filed the official
complaint that prompted the Ethics investigation, said the committee's decision
on the propriety of the meetings was unfortunate.
''The meetings themselves were wrong and should not have occurred. The five
senators involved put undue and inappropriate pressure on regulators,''
Wertheimer said. The meetings, Common Cause argued in 1990, were
''seemingly designed to put the maximum senatorial pressure on the board to
accede to Keating's wishes.''
McCain's own role remains a puzzle. Before the meetings, he had a falling out
with Keating when he learned that Keating wanted the senators to negotiate on
his behalf. McCain, new to the Senate and concerned about recent publicity over
Keating's fund-raising for him, said he would attend the meetings only to assure
himself that regulators were treating Keating fairly.
But at both meetings, first with Gray and then with thrift regulators flown in from
San Francisco, McCain looked on as DeConcini pushed the regulators to give
Lincoln a dispensation on a board regulation that barred further risky investments
- a ban that Lincoln had already exceeded by $600 million.
Two years later, Gray told a House committee that the meetings were an attempt
to ''subvert'' the regulatory process.
William Black, one of the regulators who attended the second meeting, said in
an interview that Keating clearly intended to intimidate the bank board by
assembling ''one-twentieth of the US Senate, to include two bona fide American
heroes, a Democratic leader [Cranston] and the man who was about to
become chairman of the Banking Committee [Riegle].''
McCain, despite his later insistence that he had refused to negotiate on Keating's
behalf, did not raise objections to DeConcini's advocacy for Keating, according
But Dowd, McCain's attorney, said McCain ''did nothing improper, and he
didn't know that...DeConcini was going to misbehave.''...
BILLIONS WON BY INVESTORS
The Arizona Republic
Damages and out of court settlements won by investors in Charles H. Keating
Jr.'s American Continental Corp. who filed a $1.2 billion fraud and
racketeering lawsuit in U.S. District Court in Tucson:
DAMAGES AWARDED BY JURY:
Defendants will share in a judgement of $1.8 billion in compensatory damages
returned by a jury Friday against:
Charles Keating, former chairman of American Continental, who also owes
$1.5 billion in punitive damages.
Editor's note: Now that really sounds wonderful but what does it mean?
Since Keating says he is broke that $1.5 billion just disappears form the
equation. Now there is just chicken feed left for the investors. This headline
is a lie. Notice (buried at the very end of the article!) the amount Michael
Milken had to pay and remember he was making $550 million per year when
he was stopped. That is what it means to have attorneys like the Dershewitz
brothers, Melvin McDonnald, and John Dowd. I can think of about 200
million people who would think serving a few years in the pen and keeping
all that loot was a pretty good deal!!
Saudi European Investment Corp. of Paris, was a financial partner.
Conley Wolfswinkel of Tempe, was a borrower from Lincoln Savings and Loan
Association, an American Continental subsidiary.
Continental Southern Inc., Atlanta, was a Lincoln borrower.
Former executives of American Continental and Lincoln Savings, $4.75
Law firms and individual lawyers
Jones, Day, Revis & Pogue, Cleveland: helped Lincoln prepare for a 1986
federal examination, $24 million.
Kaye, Scholer, Fierman, Hays & Handler, New York: represented Lincoln in its
disputes with federal regulators, $20 million.
Parker, Miliken, Clark, O'Hara & Samuelian, Los Angeles: worked with
American Continental's Lincoln subsidiary in connection with investigations by
California regulators, $5.65 million
Sidley & Austin, Chicago: represented Lincoln in dealings with federal
regulators, $4 million.
Mariscal, Weeks McIntyre & Freidlander, Phoenix: represented Lincoln in
dealings with federal regulators, particularly in disputes over appraisals of
properties, including the Phoenician Resort, $2 million.
Barbara Thomas, New York, $90,000.
Arthur Young & Co. (succeeded by Ernst& Young); audited Lincoln and
Continental's financial statements for 1986 and 1987, $63 million.
Arthur Anderson & Co.: audited Lincoln and American Continental's financial
statements for 1984 and 1985, $22.8 million.
Touche, Ross & Co.: audited Lincoln and American Continental from
November 1988 until April 1989, $7.5 million, plus $1 million in services for
accounting and distribution of payments to investors.
MDC Holdings, Denver, $1 Million
Isaac Heimbinder, US Homes president, Houston, $1 million.
C.V. Nalley, Atlanta, $750,000
Lee H. Henkel Jr., Atlanta, $100,000
E.C. Garcia & Co., Phoenix $90,000
Offerman & Co., Minneapolis, investment bankers, $1.5 million.
Lexecon Inc., Chicago Financial Consultant, $1 million in services for investors.
Jeffery C. Patch, PHX, appraiser, $500, 000
Richard Fenn, former vice chairman of Saudi European Investment Corp. a
financial partner, $16,000
Drexel Burnham Lambert Inc. Investment bankers, $40 to $50 million
Michael Milken, former head of junk bond sales for Drexel, $35 million to $50
Emerald Homes, PHX, Lincoln borrower, $200, 000
* * *
From: Where does Kaye Scholer Leave Us?
"Ethical Responsibilities in Regulatory Practice: Where does
Kaye Scholer Leave Us?"
By Professor Dorothy J. Glancy
ASHVILLE, N.C., September 30, 1993
"Kaye Scholer" has come to stand for a variety of administrative and civil actions
brought against attorneys by banking regulators in connection with the failure of
Lincoln Savings & Loan and other financial entities controlled by Charles H.
Most of the legal actions against Lincoln Savings lawyers have now been settled.
But the settlements seem to have left the legal profession, especially lawyers
engaged in practice involving regulatory agencies, with a great many more
questions regarding ethical responsibilities than answers....
Settlements in the Banking Cases
Over the past several years, three federal regulatory agencies which regulate
financial institutions, including the Office of Thrift Supervision (OTS), the
Resolution Trust Corporation (RTC) and the Federal Deposit Insurance
Corporation (FDIC), have brought roughly 100 claims against lawyers for several
hundred failed banks and over 700 savings and loans. The failure of Lincoln
Savings & Loan was the most prominent source of claims against professional
Accounting firms, as well as law firms and lawyers who had worked for Lincoln
Savings were charged with professional misconduct which allegedly resulted in
losses of more than $2 billion to the taxpayers and more than $250 million to the
bondholders of Lincoln Savings' parent corporation, American Continental
Banking regulators and American Continental bondholders brought monetary
claims against at least eleven professionals who served Lincoln Savings. Eight
of the eleven were law firms and lawyers.
Over the past two years, settlements of these professional liability claims related
to Lincoln Savings have amounted to more than a third of a billion dollars - at
least $337.65 million, to be more precise. Of these settlements, legal
professionals paid approximately 53%, amounting to at least $180.15 million.
Additional costs resulting from these and other settlements by former lawyers for
Lincoln Savings and other failed thrifts will affect most of the legal profession
through increased malpractice insurance premiums. Natural resources,
energy and environmental lawyers are among those with an interest in the
professional responsibility aspects of these cases involving lawyers for financial
~ ~ ~
Money is surely not the measure of the ethical responsibilities of lawyers. Large
dollar figures certainly should not be allowed to obscure the real issues of
professional responsibility which lie behind these figures. However, regulators
believe that large monetary settlements direct attention to important issues
regarding the ethical responsibilities of lawyers, particularly those engaged in
Professional Principles Asserted by Regulators of Financial Institutions
In presiding over early litigation involving Lincoln Savings, Federal District
Judge Stanley Sporkin denounced professional ethics failures on the part of
both accountants and lawyers for Lincoln Savings in a series of haunting
Where were these professionals ... when these clearly improper
transactions were being consummated?
Why didn't any of them speak up or disassociate themselves from these
Where also were the outside ... attorneys when these transactions were
What is difficult to understand is that with all the professional talent involved (both
accounting and legal), why at least one professional would not have blown the
whistle to stop the overreaching that took place in this case.
Here it is clear that the private sector was not willing to cooperate with the public
oversight regulators. Indeed, the private sector at times impeded the regulatory
authorities from discharging their duties....
Perhaps the most expansive expression of the professional ethics theories which
banking regulators enforced against the Lincoln Savings lawyers has been
offered by former OTS General Counsel Weinstein. In a 1992 speech, he
suggested six professional principles:
The first is that a lawyer must be sensitive to the role he or she chooses to
play, for the rules and principles that govern an advocate in the courtroom
do not apply to the lawyer as advisor or to the lawyer in the bank
The second is the need to practice the whole law. So-called "loophole
lawyering" must be illuminated by the whole body of law that pertains to an
The third is that a lawyer is at all times governed by a duty to deal honestly
with the facts and to comply with the disclosure and other regulations that
govern submissions to the regulatory agency.
The fourth is that a lawyer advising a fiduciary must not forget that the
fiduciary's conduct must be in the best interests of the institutional client.
The fifth is that a lawyer must report unlawful client activity up the
corporate chain of command, going as far as the corporate board of
The sixth is that a lawyer may not knowingly further a client's unlawful
More recently, Mr. Weinstein suggested that four professional principles should
guide the professional conduct of lawyers for financial institutions:
 That a lawyer should, if necessary, go up the corporate chain of
command to seek to induce a corporate client to abandon an illegal course
 That a lawyer may not assist a client in implementing an illegal plan.
 That a lawyer must give serious consideration to resignation if the client
persists in going forward illegally.
 And that a lawyer may not tell misleading partial truths in circumstances
where the law would make such action by the client actionable. . . .
A lawyer shall not counsel a client to engage, or assist a client, in conduct that
the lawyer knows is criminal or fraudulent, but a lawyer may discuss the legal
consequences of any proposed course of conduct with a client and may counsel
or assist a client to make a good faith effort to determine the validity, scope,
meaning or application of the law.
Model Rule 1.6 provides with regard to Confidentiality of Information:
(a) A lawyer shall not reveal information relating to representation of a
client unless the client consents after consultation, except for disclosures
that are impliedly authorized in order to carry out the representation, and
except as stated in paragraph (b).
(b) A lawyer may reveal such information to the extent the lawyer
reasonably believes necessary:
(1) to prevent the client from committing a criminal act that the lawyer
believes is likely to result in imminent death or substantial bodily harm; or
(2) to establish a claim or defense on behalf of the lawyer in a controversy
between the lawyer and the client, to establish a defense to a criminal
charge or civil claim against the lawyer based upon conduct in which the
client was involved, or to respond to allegations in any proceeding
concerning the lawyer's representation of the client.
Portions of Model Rule 1.13 provide with regard to the Organization as
(a) A lawyer employed or retained by an organization represents the
organization acting through its duly authorized constituents.
(b) If a lawyer for an organization knows that an officer, employee or other
person associated with the organization is engaged in action, intends to act
or refuses to act in a matter related to the representation that is a violation
of a legal obligation to the organization, or a violation of law which
reasonably might be imputed to the organization, and is likely to result in
substantial injury to the organization, the lawyer shall proceed as is
reasonably necessary in the best interests of the organization ... Such
measures may include among others:
(1) asking reconsideration of the matter;
(2) advising that a separate legal opinion on the matter by sought for
presentation to appropriate authority in the organization; and
(3) referring the matter to higher authority in the organization, including, if
warranted by the seriousness of the matter, referral to the highest authority
that can act in behalf of the organization as determined by applicable law.
(c) If, despite the lawyer's efforts in accordance with paragraph (b), the
highest authority that can act on behalf of the organization insists upon
action, or a refusal to act, that is clearly a violation of law and is likely to
result in substantial injury to the organization, the lawyer may resign in
accordance with rule 1.16.
Portions of Model Rule 1.16 regarding Terminating Representation provide:
(a) ...a lawyer shall not represent a client or, where representation has
commenced, shall withdraw from the representation of a client if:
(1) the representation will result in violation of the rules of professional
conduct or other law;...
(b) ...a lawyer may withdraw from representing a client if withdrawal can be
accomplished without material adverse effect on the interests of the client,
(1) the client persists in a course of action involving the lawyer's services
that the lawyer reasonably believes is criminal or fraudulent;
(2) the client has used the lawyer's services to perpetrate a crime or fraud;
(3) a client insists upon pursuing an objective that the lawyer considers
repugnant or imprudent;...
(d) Upon termination of representation, a lawyer shall take steps to the
extent reasonably practicable to protect a client's interests, such as giving
reasonable notice to the client, allowing time for employment of other
counsel, surrendering papers and property to which the client is entitled
and refunding any advance payment of fee that has not been earned. The
lawyer may retain papers relating to the client to the extent permitted by
Portions of Model Rule 3.3 provide with regard to Candor Toward the
(a) A lawyer shall not knowingly:
(1) make a false statement of material fact or law to a tribunal;
(2) fail to disclose a material fact to a tribunal when disclosure is necessary
to avoid assisting a criminal or fraudulent act by the client; ... or
(4) offer evidence that the lawyer knows to be false. If a lawyer has offered
material evidence and comes to know if its falsity the lawyer shall take
reasonable remedial measures.
Under Model Rule 3.9, the candor required under Model Rule 3.3 also applies to
advocates in nonadjudicative proceedings before legislative or administrative
bodies. At the heart of most of the ethical issues posed by the application of
these professional ethics rules to the conduct of lawyers for rogue financial
institutions, such as Lincoln Savings, is the nature of a lawyer's ethical
responsibilities when her client has engaged, or is engaging, in misconduct.
Judge Sporkin and the banking regulators faulted former lawyers for Lincoln
Savings for failing to do something about illegal activities which culminated in the
failure of the thrift. Precisely what the Lincoln Savings lawyers should have done,
but failed to do, is much less clear. Banking regulators now usually deny that their
actions against Lincoln savings lawyers were based on any generalized ethical
duty on the part of lawyers to "blow the whistle" and inform regulators of the
misconduct of their clients, as Judge Sporkin's opinion in Lincoln Savings &
Loan Ass'n v. Wall might have seemed to suggest. Banking regulators' current
views regarding this issue seem to be reflected in a speech by former OTS
general counsel, Weinstein, this past April:
The OTS did not claim that the [Kaye Scholer] law firm had a professional
obligation to blow the whistle on its client by volunteering confidential client
information. Had the lawyers and their client remained silent instead of making
affirmative representations, the charge of omission of material facts would not
have been available. The material omission counts were premised on the client's
disclosure obligation, coupled with a charge that the lawyers by their conduct had
assumed the client's obligation for compliance with the OTS rules that forbid
material omission in communications with the agency.
According to the chief architect of the charges against Kaye Scholer, what was
unethical about the law firm's conduct was that the lawyers transformed
themselves into "institution-affiliated parties" by controlling the information flow in
the regulatory examination of Lincoln Savings. The law firm then violated legal
duties imposed on such affiliates, including the duty to avoid misleading the
Truthfulness in Regulatory Practice
Truthfulness is among the virtues generally expected of ethical persons,
including lawyers, whether or not they are involved in regulatory practice. The
Model Rules of Professional Conduct require truthfulness to tribunals before
which a lawyer practices under Model Rule 3.3, noted above. Model Rule 3.9
extends these duties of candor to nonadjudicative proceedings....
The conduct of counsel for the United States in violating the duty of candor has
been most egregious and disturbing. Such conduct is worthy of sanction and
must also be deterred. Dismissal with prejudice accomplishes these dual aims....
Today we will send a message to all counsel who appear before this court that
the duty of candor will be upheld and preserved at all times irrespective of the
identity of the parties and the monetary stakes in the litigation....
Truthfulness is required of lawyers who represent regulatory agencies, just
as it is required of lawyers for regulated parties.
Truthfulness in dealing with federal agencies is something more than an
ethical virtue. It is required by law. Being untruthful to federal agencies can
result in statutory criminal penalties under 18 U.S.C. ' 1001:
Whoever, in any matter within the jurisdiction of any department or agency
of the United States knowingly and willfully falsifies, conceals or covers up
by any trick, scheme, or devise a material fact, or makes any false, fictitious
or fraudulent statements or representations, or makes or uses any false
writing or document knowing the same to contain any false, fictitious or
fraudulent statement or entry, shall be fined not more than $10,000 or
imprisoned not more than five years, or both.
Other statutes, such as the False Claims Act, provide severe penalties for
fraud and misrepresentation in monetary claims made to federal agencies.
The False Claims Act could apply, for example, to claims for compensation
made by lawyers who assist federal agencies with environmental
remediation. Criminal penalties for false claims are provided under 18
U.S.C. ' 287. Civil actions for false claims are governed by 31 U.S.C. '' 3729
and 3730. The controversial qui tam provisions of 31 U.S.C. ' 3730 offer
rewards (15-20% of the amount recovered) to those, including attorneys,
who blow the whistle and report false claims which have defrauded the U.S.
government. Natural resources, energy and environmental lawyers are
required by these and other statutes, as well as general ethical principles,
to be truthful in their dealings with federal regulatory agencies. Of course,
lawyers for regulatory agencies are required to be truthful as well....
Particularized Ethical Duties for Lawyers in Specialized Practice
One final issue regarding ethical responsibilities in regulatory practice has been
implicit throughout this discussion. That is the issue whether the particular
regulatory context of a lawyer's actions does or should create different ethical
responsibilities. Part of what the regulatory actions against the Lincoln Savings
lawyers has come to signify is the importance of paying attention to the particular
regulatory context, when lawyers represent regulated clients.
Judge Sporkin, who asked why professionals, such as lawyers and accountants,
had not prevented the Lincoln Savings debacle, refers to this focus on legal
specialization as "new world lawyering."
In a speech before the Securities Litigation Committee of the San Francisco Bar
Association in January of 1992, Judge Sporkin suggested that a lawyer's ethical
duties may vary according to the regulatory context in which she practices . . .
To those of you who are just now settling into comfortable complacency regarding
the particular ethical uprightness of natural resources, energy and
environmental lawyers, let me suggest just two words: "Teapot Dome."
Seventy years ago it was the scandal of the century. Will Rogers called it the
"great morality panic of 1924."
The transfer of the Teapot Dome and Elk Hills petroleum reserves and the
corrupt issuance of the mineral leases on them could not have been pulled
off without the assistance of lawyers.
In fact, many of those accused in the scandal were lawyers. But that was not why
they were accused. Teapot Dome clearly involved lawyers who worked with
natural resources, energy and the environment, although, aside from natural
resources law, these areas of the law did not exist, as such, at the time of Teapot
Today, the practice of natural resources, energy and environmental law is
growing ever more complex. You may have seen the Arthur Andersen
Environmental Services survey for the National Law Journal (August 30, 1993),
which reported that nearly 70 percent of the corporate counsel surveyed
believed that total compliance with all federal and state environmental
regulation is simply not achievable.
"Due to the complexity of the law, the varying interpretations of regulators,
the ever-present role of human error and the cost," violation of
environmental laws and regulations seems to be both constant and
inevitable for just about every business.
Perceptions such as these highlight some of the reasons why natural
resources, energy and environmental lawyers in regulatory practice face so
many ethical challenges....
The above was excerpted from a Google search:
Where does Kaye Scholer Leave Us?
FOR A CLOSER LOOK AT MORE BUZZARDS ON THE
Angela Styles - Bush’s Administrator for the Office of Federal Procurement
Pre-hearing Questions for Angela Styles to be Administrator for
the Office of Federal Procurement Policy of the Office of
Management and Budget
I. Nomination Process and Potential Conflicts
1. Why do you believe the President nominated you to serve as Administrator for
the Office of Federal Procurement Policy (OFPP)?
I was chosen based on my extensive legal and legislative experience in the fields
of procurement and cost accounting. Over a number of years, I have represented
clients in numerous aspects of procurement law and litigation, including
regulatory compliance, procurement fraud, bid protests, claim preparation, cost
and pricing issues, defective pricing, accounting issues, contract disputes and
claims, contract negotiation, litigation of complex corporate-wide accounting and
contract issues, and negotiation of broad corporate-wide advance agreements
with the Defense Contract Management Command. Of particular importance
because the Administrator of OFPP serves as chair of the Cost Accounting
Standards Board, a significant portion of my legal practice focused on Cost
Accounting Standards compliance, cost allowability, and cost allocation.
2. Were any conditions, express or implied, attached to your nomination to be
3. Have you made any commitments with respect to the policies and programs
which you will attempt to implement as Administrator? If so, what are they?
4. Are there any issues involving OFPP from which you may have to disqualify
yourself? If so, what system will you establish to carry these out?
Any potential conflicts of interest will be handled through the recusal process, in
which I would remove myself from the action, and refer all activity to the next
responsible official within the Office of Federal Procurement Policy or the
Office of Management and Budget. I have notified the Designated Agency
Ethics Official within OMB of certain former clients whose legal matters I handled
while in private practice. In accordance with 5 CFR §§ 2635.502, for one year
following the termination of my employment at the law firm of Miller & Chevalier,
Chtd., I will not participate in any particular matter involving specific parties in
which, to my knowledge, my former employer, Miller & Chevalier, Chtd., or my
former clients, is a party or represents a party, unless I am authorized to
My spouse is employed by Bergner, Bockorny, Castagnetti, Hawkins and
Brain. Pursuant to 5 CFR §§ 2635.502, I will not participate in any particular
matter involving specific parties in which Bergner, Bockorny, Castagnetti,
Hawkins and Brain is or represents a party, unless I am authorized to
participate. Furthermore, pursuant to 5 CFR §§ 2635.502, I will not participate in
any particular matter involving specific parties in which any client of my spouse is
or represents a party, unless I am authorized to participate. In addition, my
spouse has agreed not to represent any client with respect to any particular
matter before the Office of Federal Procurement Policy during my tenure.
* * *
Federal Procurement Chief Outlines Priorities
Bush administration supports continuation of public-private competitions
by Elizabeth G. Book
Government procurement policies will not change drastically in light of the
planned “war on terrorism,” a senior procurement official told defense industry
“The Defense Department hasn’t said yet that they need more acquisition
authority, so we are not going to do anything right now to change our policies. We
have a wait-and-see attitude,”” said Angela B. Styles, the president’s appointee
as administrator for the Office of Federal Procurement Policy.
The OFPP is part of the Office of Management and Budget.
The OFPP, which has been without an administrator since June 2000, is
undergoing change and reforms, she said. Styles spoke recently at a luncheon
with defense industry representatives. She is responsible for advising the
administration on government-wide procurement initiatives.
The Bush administration’’s priorities in procurement policy involve competitive
sourcing, which is based on public-private competitions. The White House also
seeks to improve the level of government performance and to return the
government to the principles of competition, she said. Styles mentioned that one
of her planned initiatives is to phase out the mandatory source status for the
Federal Prison Industries (FPI), a policy that has been criticized by the
business community for being anti-competitive and detrimental to small, niche-type suppliers.
Under a law in place since the 1930s, if the federal government wants to buy any
product that FPI produces, it must purchase the product from FPI. FPI is a quasi-governmental organization that manufactures items at facilities manned by
Styles wants to allow the private sector to compete for these contracts.
Currently, if a federal agency wants to use a private sector source for a product
that FPI produces, they have to submit a waiver to the FPI. “Our office will work to
phase out the policy,” she said. The Competition in Contracting Act, which
deals with this issue, is favored by the current administration.
Styles said another OFPP priority is to change the way that rules are published in
the Federal Register. The Federal Register, a government-wide publication, is
used by the agencies to publish rules and regulations, which are governing tools
for the federal agencies. They do not have to be codified by Congress. “There is
a lack of quality and logical analysis in what we see published in the Federal
Register,” Styles said.
“We don’t often see a rational analysis,” she said, especially in the preambles to
rules, which are supposed to contain background information, reasoning for the
proposed rules, and a summation of industry comments.
“We can do a lot better to explain to you why we are making the decisions we
are,” she said.
“The OFPP should have a greater leadership role in the rule-making
process. Right now, I am holding back on rules that I don’t think are
specific in their explanations.”
Styles reported that she had testified before the House of Representatives
subcommittee on technology and procurement policy and made the case for
another of her priorities, competitive sourcing. She said that competition helps to
attract “viable, responsive, innovative and cost-effective public and private
competitors to the federal sector.”
She testified that “when a commercial function performed by the public sector
undergoes competition, that competition results in significant economic savings to
the taxpayer,”” she said. “The use of public-private competition consistently
reduces the cost of public performance by more than 30 percent,” she said.
Styles explained that the Federal Activities Inventory Reform (FAIR) Act, which
was codified in 1998, seeks to publicize those government functions that can be
outsourced to the private sector. The FAIR Act requires that a list be published
each year for jobs that are available to non-governmental entities, but also
maintains ““a list of activities that are inherently governmental, that cannot be
outsourced,”” she said.
The enforcement of the FAIR Act at all federal agencies, Styles said, underscores
her office’s “commitment to competition.”
“It is a tool to encourage good management at the agencies. I want good cost,
good quality, and availability of service. I’m not really concerned about who’s
providing it,” she said.
“We’re not trying to de-layer the workforce. Nor are we discouraging agencies
that want to bring things back in-house. This is an opportunity to solve problems
we see in procurement.
“Competitive sourcing facilitates our use of performance-based service contracts,
which bring innovation, creativity, new ideas,” she said.
Styles said that competitive sourcing policies bring integrity to the process, to
assure taxpayers that their money is not being wasted.
OFPP opposes a contracting bill that gained momentum during the closing
months of the Clinton administration and appears to be gaining fresh support on
Capitol Hill. The Truthfulness, Responsibility and Accountability in
Contracting (TRAC) Act places a six-month moratorium on all federal contracts
which are not deemed “essential,” and could permanently freeze, or “blacklist” the
contractor’s activities if it is shown that the work could be performed more cost-effectively by the public sector. According to Styles, the TRAC act “would put at
risk the federal government’s ability to acquire needed support services in both
the short and the long term,” she said.
“There is no aspect of the TRAC Act that would contribute to competition,
efficiency or accountability,” she said.
Prior to her confirmation in May 2001, Styles was a counselor to the director of
OMB. From January to April 2001, she was in a temporary appointment at the
General Services Administration’s (GSA) office of government-wide policy and
public buildings service. Before that, she was an attorney for Miller & Chevalier,
a law firm in Washington, D.C. She also did a stint on Capitol Hill, working as a
legislative aide for Rep. Joe Barton, R-Texas.
Styles’ legal practice concentrated in the area of federal procurement law and
litigation, including cost and accounting issues, defective pricing, procurement
fraud matters, contract disputes and claims, contract drafting and negotiations,
and compliance matters. During the past several years, her practice increasingly
focused on government contract disputes involving cost accounting standards
compliance, cost allowability and allocation.
Styles litigated contractors’ claims against the U.S. government before the
Armed Services Board of Contract Appeals, the United States Court of
Federal Claims, and the United States Court of Appeals for the Federal
Circuit. Since 1998, she has chaired the American Bar Association’s Contract
Law Committee. She has a bachelor’s degree from the University of Virginia, and
a law degree from the University of Texas. —— Elizabeth G. Book
See also: Miller & Chevalier
Bridgestone/Firestone, Inc. - Where the rubber meets the road....and
sometimes stays there.
June 24, 2001
Lawyers Knew of Explorer Tire Woes
Attorneys withheld complaints for four years to protect cases ...
The New York Times
A group of personal-injury lawyers and one of the nation’s top traffic-safety
consultants identified a problem with Firestone ATX tires on Ford Explorer sport
utility vehicles in 1996. But they did not disclose the pattern to government safety
regulators for four years, out of concern that private lawsuits would be
Sean Kane, the consultant, said he had identified 30 cases of tire failure in 1996
– a few of them involving deaths – after being retained by lawyers in Texas
preparing lawsuits against Bridgestone/Firestone, Inc.
But Kane and the lawyers, lacking confidence in federal regulators, repeatedly
decided not to tell the National Highway Traffic Safety Administration about the
problem, said Kane, who in 1997 became the partner for tire issues at Strategic
Safety, a top traffic-safety consulting firm. As Strategic Safety began working on
Explorer crashes with lawyers across the country, the consultants and lawyers
chose not to submit the safety complaint forms that might lead to
government investigations. . . .
Of the 203 deaths related to Firestone tires reported to regulators, all but 13
occurred after 1996. . . .
Dr. Ricardo Martinez, the administrator of the traffic safety agency from 1994 to
1999, said he was appalled to learn that information had been kept from his staff
for years. . . .
“It’s outrageous, I can’t say that enough,” said Martinez, a trauma surgeon. “If I
saw something was killing my patients and I didn’t say anything because that
would reduce the demand for my services, I would be putting my benefit over the
benefit of my patients and the public, and that would clearly be unethical.”
Kane said that the lawyers’ first duty was to win as much money as possible for
the crash victims whom they represented. The lawyers can collect up to a third of
any settlement or court verdict.
Geoffrey C. Hazard Jr., the trustee professor of law at the University of
Pennsylvania Law School and a leading expert on legal ethics, said the lawyers
had not broken any laws or ethical codes.
“They had a civic responsibility the same as you or I do, but they didn’t
have a legal duty,” he said. . . .
In October 1996, KPRC, a Houston TV station, ran a report on the tires and
forwarded to Kane some complaints from people whose tires had failed. . . .
Kane said he told reporters at several television news magazines about the
problem in 1998. But the reporters decided not to run stories.
Regulators did not open an investigation of the tires until February 2000, after a
report on another Houston TV station prompted a flurry of complaints from
consumers who had not retained lawyers. . . .
Global Funding Limited Trust -
October 17, 2001
Former Castle Rock attorney arrested
in Florida for part in investment scam
By Terri Moon Cronk
A former Castle Rock attorney, blighted by bounced checks and civil cases in
Douglas County courts dating as far back as 1994, recently was arrested in
Florida in a $20 million investment scam.
Royce Edward Tolley, 42, was arrested in Gainesville in mid-October and
charged with four others with rotating money through a "maze of national and
international accounts," says a story by The Associated Press. . . .
Tolley was named as a trust owner with George Melvin Bevre, 48, of Atlanta.
Both were arrested.
Investors reportedly were told they would "reap enormous returns" through an
investment program identified as Global Funding Limited Trust.
Federal investigators aren't sure how many investors were affected, the story
A federal indictment, once unsealed, showed that the five men "rotated" money
from June 1996 to January 1998 to keep funds hidden from customers and retain
the money for themselves, the story said.
Also named in the indictment were California attorney James Charles Morris,
54, of Gardnerville, Nev., and Florida residents Calvin Frederick Brown, a 53-year-old exotic bird dealer, of Williston, and house painter Robert Charles
Stewart, 40, of Gainesville.
Each of the five men faces 19 felony counts from wire fraud, interstate
transportation of stolen property and money laundering conspiracy, The
Associated Press reported. . . .
Harvey Pitt - Chairman of the Securities and Exchange Commission.
July, 2001 - From Web Today:
Harvey Pitt Bad Choice for
by Rev. Louis Sheldon, Chairman: Traditional Values Coalition
The Securities and Exchange Commission should be headed by a person who
has both the professional skills and the moral clarity to make tough decisions
about financial matters. The chairmanship of the SEC should be held by
someone who has a moral compass, not a person who is willing to represent the
interests of a pornography empire.
Last week, TVC sent a letter of concern to President Bush over his choice of
Harvey Pitt to be our nation's Securities and Exchange Commission chairman.
We expressed our concern about Pitt after learning that in 1999 he had done
legal work for the New Frontier Media company. Pitt had helped New Frontier
overcome a problem with the NASDAQ over two stock sales. According to news
reports, Pitt's aid to this pornography company helped it keep its listing on the
New Frontier Media is a purveyor of sexually explicit filth that is piped into
homes through its three cable services: Pleasure, TeN, and Extasy. Three of
New Frontier's biggest pornography customers are AT&T, Time Warner, and
Echo-Star Communications (DISH-TV).
This company also operates IGallery.com, an Internet company that hosts such
sites as "Teen Sex," "Café Flesh," and two other sites with names describing
oral sex and women's sex organs.
The Vice President of Corporate Development at New Frontiers is Greg Dumas,
who has the dubious distinction of having been Vice President of Marketing for
Larry Flynt Publications. Dumas helped launch Hustler Online.
Hustler, of course, is one of the most obscene magazines in print and Flynt's
smut empire demeans and humiliates women by portraying them as body parts to
be used and thrown away. Flynt has also promoted pedophilia through his
"Chester the Molester" cartoon. Pedophiles in the North American Man-Boy Love
Association (NAMBLA) must gain inspiration from Hustler's pro-child molester
Is Harvey Pitt really proud that he represented such an evil and perverse
company? Harry Gracin, New Frontier's securities lawyer says he is offended by
TVC's efforts against Harvey Pitt. According to Gracin, Pitt "... is an honest and
decent man, and he took the case to help us out. All he agreed to was to get us a
Gracin must have a different definition of what constitutes an "honest and decent
man," than we do. Pitt aided a company that earns millions by selling the sexual
exploitation of women and teenage girls for profit. And a company where one of
its vice presidents proudly lists his association with Larry Flynt as a positive
Pitt's nomination reminds me of the recent choices of former Massachusetts
Governor Paul Cellucci to be our Canadian Ambassador and homosexual activist
Scott Evertz to be White House AIDS czar. These were unfortunate choices, but
it is not too late for the White House to change course on the choice of Pitt.
We urge the White House to look elsewhere for our nation's next SEC chairman.
Traditional Values Coalition is an inter-denominational public policy organization
comprising over 43,000 member churches. For more information call Christy
Moore at (202) 547-8570. TVC, 139 C Street, SE, Washington, DC 20003. Web
~ ~ ~
August 3, 2001
Senate Confirms SEC Chairman Harvey Pitt
WASHINGTON (SmartPros) —— The Senate unanimously approved Harvey Pitt
as SEC chairman for a term expiring June 5, 2007. President Bush is expected to
appoint Pitt as chairman now that the confirmation process is complete.
Pitt was nominated in early July by President Bush to head the SEC and was
confirmed by the Senate Committee on Banking, Housing and Urban Affairs
in late July. The final confirmation occurred on August 1 by the U.S. Senate.
Pitt has spent two decades as a lawyer and corporate partner resident in
international law firm Fried Frank's Washington, DC and New York offices. He
has represented clients in every facet of securities-related issues, including
the AICPA and Big Five firms.
"Mr. Pitt's work at the SEC and representing clients brought before the SEC give
him an extraordinary knowledge of Federal securities laws," said Senator Paul S.
Sarbanes, Chairman of the Committee on Banking, Housing and Urban Affairs.
Pitt follows the footsteps of former SEC chairman Arthur Levitt, the longest-serving chairman in the history of the organization who left shortly after President
Bush entered office. Republican commissioner Laura Unger has served as acting
chairman in the interim....
For much more on Harvey Pitt, GO TO > > > Spotting the SEC
For more on Arthur Levitt, GO TO > > > Birds that Drink from Cesspools
Marshall Lippman - Disbarred, but doing fine.
January 22, 2004
New Jersey Buyers of ‘Dream Homes’
Relate Their Nightmares
By Richard Cowen, The Record, Hackensack,
N.J. Knight Ridder/Tribune Business News
For some homeowners, New Jersey’s housing boom has been a bust – and
some of them went to Trenton on Wednesday with tales of new homes filled with
cracked walls, flooding basements, and broken dreams.
The citizens who testified before the State Commission of Investigations said
they had been burned not once, but twice – first by greedy builders who did
shoddy work and refused to make repairs, and then by the state’s own clumsy
bureaucracy, which failed to come to their rescue.
By the end of the day, SCI Chairman Francis E. Schiller was shaking his head in
“It is unconscionable that in this, the 21st century – an era in which the mere flick
of a switch brings us crystal-clear, close-up images of Mars – that hardworking,
law-abiding citizens here at home are victimized by a system that often cannot
decipher and implement the simplest features of a warranty,” Schiller said.
“Something must be done, and through this process, by publicly exposing and
examining the extensive flaws of that system, we have taken an important first
The warranty on newly constructed homes is one of many documents a buyer
picks up at the closing – and is so thick with legal terminology that many people
don’t know where they stand until something goes wrong with the house.
And as the SCI investigation found, the warranty system is both confusing to
homeowners and fraught with abuse by builders.
“A nightmare” is the way Graham Fill of Butler described his life since January
2001, when he bought a new house in the Hemlock Estates development.
Shortly after moving in, Fill noticed water running down the walls of his basement.
Fill figured his warranty was strong enough to force the builder, Majestic Homes
of Boonton, to fix the problem. But despite the warranty, the builder refused, Fill
Fil had hired his own engineer, who determined that a 30-foot patch of brick
facade would have to be removed to install flashing to protect the inner walls.
When the builder refused to do the work, Fill had two choices: sue the builder in
state Superior Court, or submit to binding arbitration, a system run by the state
Department of Community Affairs.
He chose arbitration.
“I thought it would be quicker and cheaper,” Fill said. Three years later, the
repair hasn’t been made, Fill testified before the SCI on Wednesday.
Fill said he made a videotape of the damage and submitted other documents to
the arbitrator, Steven Rapp, appointed by Construction Arbitration Services
Inc. of Dallas, Texas. Fill told the SCI he got the immediate impression that Rapp
wasn’t impartial. He said Rapp didn’t think the submitted evidence was enough
to warrant replacing the brick facade.
Fill then hired as attorney and threatened to sue. It was only after Rapp agreed
to review his own arbitration decision that he made a startling admission, Fill
“He came by [the house] and said that he had a business relationship with the
builder,” Fill told the SCI. “He said he and the builder had done some land
Neither Rapp nor anyone from Majestic Homes could be reached for comment
Wednesday. But a lawyer for Construction Arbitration Services, Marshall
Lippman, said Rapp should have disclosed that information to the company,
which would have recused him from the case.
“That was information that should have been disclosed before he took the case,”
Fill said he lost all faith in the arbitration process at that point.
“I just about exploded,” he said. After waiting three years and spending
thousands of dollars on legal and expert fees, Fill said, he appealed the initial
arbitration ruling and won. Majestic Homes is supposed to replace the facade
when the weather warms up, he said.
The SCI plans to hold more hearings in coming months. Homeowners who have
had problems with their warranties can contact the SCI at (609) 202-6767 or
online at www.state.nj.us ...
* * *
DISTRICT OF COLUMBIA COURT OF APPEALS
BOARD ON PROFESSIONAL RESPONSIBILITY
In the Matter of:
MARSHALL E. LIPPMAN, Respondent
Bar Docket No. 240-01
REPORT AND RECOMMENDATION OF THE
BOARD ON PROFESSIONAL RESPONSIBILITY
Respondent is a member of the District of Columbia Bar, having been
admitted by motion on July 9, 1993. Respondent was also admitted to practice in
New York. On July 17, 1997, the Appellate Division of the First Department of
the New York Supreme Court disbarred Respondent. That discipline was based
on a determination that Respondent had committed misconduct in five matters,
including, in two matters, intentional misappropriation of client funds. Bar
Counsel argues, and we agree, that the identical reciprocal discipline of
disbarment should be imposed here....
For more on Marshall E. Lippman, GO TO > > > Paradise Paved
Miller & Chevalier - Big, politically-connected law firm.
May 17, 2001
Estate’s revenues hit record
$996 million in 2000
The sale of Goldman Sachs stock figures largely in the
18.7 percent rise for Kamehameha Schools
By Rick Daysog, Star-Bulletin
The Kamehameha Schools posted record revenues last year due in large part
to the sale of its stock in Goldman Sachs Group Inc.
The charitable trust said its total revenue for the year ended June 30, 2000, was
$995.9 million, an 18.7 percent rise from the year-earlier's $839 million.
The $5.7 billion estate - founded in 1884 to educate children of Hawaiian ancestry
- said that its subsidiaries and outside investments netted $567.9 million last year,
including the Goldman Sachs sales. Last year, the trust sold 11 million shares,
worth about $1 billion.
Its real estate arm, Bishop Holdings Corp., produced $38.7 million, while its
Southern Nevada Income Properties subsidiary netted $24.3 million.
In a tax filing with the Internal Revenue Service, the trust reported that it spent
$132.7 million on its educational program and construction, down 7.2 percent
from 1999's $143 million. . . .
The tax filing also provided a detailed description of the salaries paid to trustees,
staffers and expenditures made to its outside contractors.
Former interim trustees David Coon, Francis Keala, Ronald Libkuman and
Constance Lau each earned $192,500 during the 2000 fiscal year while retired
Admiral Robert Kihune, the board's chairman, was paid $203,500.
In January, the interim board was replaced by a permanent board, which included
Lau, Kihune, attorney Douglas Ing, local business executive Diane Plotts and
Hawaiian navigator Nainoa Thompson.
Hamilton McCubbin, who became the trust's first chief executive officer in
February 2000, was paid $122,031 for the February 2000 to June 2000 period.
McCubbin's contract called for a salary of about $300,000 for the 2000 calendar
year. School President Michael Chun earned $213,578 during the 2000 fiscal
year while Nathan Aipa, the estate's former acting chief operating officer, earned
$195,451. Aipa currently serves as special projects officer.
As for the trust's outside contractors, the Washington D.C. law firm of Miller &
Chevalier was paid $3.4 million for work relating an IRS audit and the removal
of the former trustee last year while the accounting firm of KPMG Consulting
LLC billed the trust $1.3 million.
Cades Schutte Fleming & Wright billed the trust $1.3 million while Watanabe
Ing & Kawashima was paid $1.2 million.
See also: Angela Styles
For more on Miller & Chevalier, GO TO > > > Harmon’s Letters to Dr. Hamilton
For more on KPMG Consulting, LLC, GO TO > > > P-s-s-t, wanna buy a good
Morgan Lewis & Bockius - Big, “reputable” law firm and lobbyist.
June 11, 2001
Convicted Morgan Lewis Partner
Denied New Trial
From New York Lawyer
Former Morgan Lewis & Bockius partner Allen W. Stewart -- who was
convicted of racketeering, fraud and money laundering in 1997 and sentenced to
15 years in prison -- has been denied a new trial by a federal judge,
Philadelphia's Legal Intelligencer reports.
The former head of Morgan Lewis' insurance department was convicted on
charges of draining the assets of two insurance companies he controlled and
then selling the companies to unwitting buyers who soon discovered they were
insolvent. . . .
The indictment charged that Stewart's schemes were designed to obtain money
and property, including licenses and the retention of licenses, premiums from
policyholders and customers, dividends, consulting and management fees, and
an inflated sales price for the Summit National Life Insurance Co.
* * * * *
August 15, 1996
Mary Frangipanni's Political Notebook
By Mary Frangipanni, Philadelphia CityPaper.net
By 9 p.m. Monday, Pennsylvania Republicans attending the Republican
convention in San Diego had to chill out after listening to all those speeches. And
what better way to relax then at the poolside party for Lackawanna County
Congressman Joe McDade?
This was a victory party for McDade, who was just acquitted on charges of
campaign fund fraud after an eight-year investigation. McDade is the Chairman
of the House Appropriations Committee and as Northeast Philadelphia State
Rep. George Kenney put it, "Now the Republicans are back in power, which
means more tax dollars for our state."
There was, however, much more interesting —— and ironic —— news floating
around the McDade soiree.
A prominent Philadelphia law firm and its senior partners will soon be
indicted, according to sources close to the case.
The firm, Morgan Lewis Bockius, represented defrocked State Attorney
General Ernie Preate.
What's ironic about that?
The fact that people attending a party to celebrate the exoneration of McDade
were talking about the continuing miseries associated with a local pol who wasn't
able to dodge the prosecutorial bullet.
The crux of the investigation into Morgan Lewis Bockius, sources say, are the
legal fees paid to the firm by the Commonwealth of PA.
The Commonwealth, according to sources, paid the law firm $441,000 to
represent not Preate, but the office of attorney general.
However, say sources, the law firm used a portion of that money to represent
Preate personally in the mail fraud case against him because Preate could not
afford to pay his legal bills.
Investigators, say the sources, are specifically looking into whether there was any
conflict of interest involved because one of Preate's top deputies, Walter Cohen,
at the time worked for the law firm.
Mark Dichter, managing partner of the law firm's Philadelphia office,
acknowledged the investigation. However, he said he has "no knowledge of any
pending indictment, or any discussion of an indictment, in this matter."
Sources say the firm knew that the money was going to Preate's personal
defense. They add that they expect the indictment to occur shortly after Labor
Day. . . .
For more, GO TO > > > Dirty Money, Dirty Politics & Bishop Estate; Buzzards of
Oh, so much more to come . . .
In the meantime, you can browse through the following
while you’re having your breakfast birdseed:
BUZZARDS OF PARADISE
DIRTY MONEY, DIRTY POLITICS & BISHOP ESTATE
THE FIRING OF EVAN DOBELLE
FLYING HIGH IN HAWAII
HOW TO PLUCK A BILLIONAIRE
PREDATORS IN PARADISE
RICO IN PARADISE
THE HARMON ARBITRATION
THE INDONESIAN CONNECTION
THE NESTS OF CB RICHARD ELLIS
THE QUEEN LILIUOKALANI TRUST
THE VULTURES IN MAUNAWILI VALLEY
VAMPIRES ON GILLIGAN’S ISLAND
VULTURES IN THE MEADOWS
YAKUZA DOODLE DANDIES
~ ~ ~
MORE OF THE CATBIRD’S FAVORITE LINKS
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Originally posted: November 22, 2001
Last Update April 30, 2010, by The Catbird