New York Law Journal, Devoted in Library Science from St
Total Page:16
File Type:pdf, Size:1020Kb
VOLUME 206—NO. 108 $4.00 WWW. NYLJ.COM WEDNESDAY, DECEMBER 5, 2018 Serving the Bench and Bar Since 1888 ©2018 ALM MEDIA PROPERTIES, LLC. Second Circuit Upholds Gambler’s Queens Borough IN BRIEF Insider-Trading Conviction Prominent Foreclosure Firm Settles Fraud Charges President Melinda Katz The prominent foreclosure law profits by fraudulent conduct.” hard-pressed to conclude that the firm Rosicki, Rosicki & Associ- The government’s actions BY B. COLBY HAMILTON leaking by a government official ates has reached a settlement against Rosicki and a pair of of confidential information to the Announces Run for DA with the U.S. Attorney’s Office wholly-owned affiliates came THE SECOND Circuit upheld the press ‘shocks the conscience,’” for the Southern District of New as a complaint-in-intervention insider trading conviction of for- the panel stated. “While there may York Tuesday, over allegations in a suit already being pursued mer professional gambler William be circumstances where strategic BY ANDREW DENNEY it bilked the federal housing by a whistleblower against the Walters on Tuesday, dismissing leaks of grand jury evidence by law authority Fannie Mae by falsely law firm Peter Grubea. arguments his indictment should enforcement rises to the level of QUEENS Borough President Melin- inflating bills to the mortgage The FCA violations by Ros- be dismissed because an FBI agent outrageous conduct sufficient to da Katz announced Tuesday that servicing companies for which icki began in the aftermath of provided detailed leaks of the gov- warrant dismissal, those circum- she is running for district attorney it worked. the housing crisis a decade ernment’s investigation to news stances are not present here.” in her borough, laying out a pro- The settlement resolves ago. An embattled Fannie Mae outlets. Ahead of being indicted, news gressive-leaning platform for the the civil fraud suit brought by began using servicers to help, While the panel—composed stories appeared in both The Wall office that includes ending cash Manhattan prosecutors under among other things, pursue of Circuit Judges Denny Chin and Street Journal and The New York bail for misdemeanors and form- the False Claims Act. The gov- foreclosures. These servicers Dennis Jacobs, and U.S. District Times in 2014 detailing elements of ing a unit to review questionable ernment alleged that Rosicki would retain law firms, such as Judge William Kuntz of the East- an insider trading investigation into convictions. under two affiliates generated Rosicki, to go through the legal Walters, Thomas Davis, a member Katz, a Democrat who is in her false and inflated bills for fore- foreclosure process. of Dallas-based Dean Foods board, second term as borough president, closure and eviction expenses. According to prosecutors, and other targets. These leaks, it is the third candidate to officially Those inflated expenses were beginning in 2009 Rosicki would be revealed, were being pro- announce that she is running to PHOTO COURTESY then submitted to and paid for used the affiliates as vehicles vided by Chaves. succeed Richard Brown, who has by the Federal National Mort- for marking up foreclosure In February 2016, Davis began served as Queens DA since 1991 gage Association. expenses as much as possible, cooperating with the government and who has managed to avoid a The Manhattan U.S. attor- while adding as little operating and soon pleaded guilty. Walters serious challenge in elections held Melinda Katz ney’s office said the settlement expense as possible, in order to was indicted in May. At trial, Davis since. REUTERS also covers identical conduct maximize revenue. testified that he conspired to com- “I’m running as a different type around eviction expenses paid As part of the settlement mit insider trading with Walters of district attorney,” Katz said in announced that they are running William Walters for by the U.S. Department of approved by Judge Jed Rakoff between 2008 and 2014, and that an interview. “The DA’s job has to for the seat, and both have said Veterans Affairs. of the U.S. District Court for the Walters traded on that information be making changes in legislation as they, too, would stop prosecuting “Lawyers are not above Southern District of New York, ern District of New York, sitting to purchase or sell Dean Foods and well as investigating crime.” certain low-level offenses and form the law,” U.S. Attorney Geof- the firm admitted and accepted by designation—made clear it other stocks. Brown, who is 86, has said that conviction review units. frey Berman said in a state- responsibility for its conduct found the leaks by Special Agent Walters was convicted on all he intends to serve out the remain- Additionally, Mina Malik, a for- ment. “For years, the Rosicki and agreed to pay $4.6 million David Chaves to be reprehensible counts by a jury in April 2017. der of his term, which concludes mer Queens prosecutor who is now firm submitted bills to Fan- in restitution to the government, and likely illegal, it held that the On appeal, he largely reiterated at the end of next year, and that the deputy attorney general for nie Mae and the VA that con- prosecutors said. indictment and conviction of Wal- the line of argument made to U.S. he does not intend to make a deci- the Office of the Attorney General tained inflated and unneces- A spokesman for the firm did ters were secured without the District Judge Kevin Castel of the sion about his future plans until for the District of Columbia, has sary charges. This Office will not immediately respond to a kind of overwhelming misconduct Southern District of New York next year. reportedly expressed interest in continue to hold accountable request for comment. required for such drastic moves. ahead of trial. City Councilman Rory Lancman running for the seat but has not those who seek to achieve —Colby Hamilton “The court certainly does not Walters argued the indictment and recently retired state Supreme officially declared her candidacy. condone the conduct, but we are against him should be dismissed Court Justice Gregory Lasak, who The declared candidates’ stated because of grand jury leaks, while are both Democrats, previously plans for the office each » Page 8 Winston & Strawn Deriva- est sectors for the client base Online adding that government suborned tives Ace Heads to Goodwin that I work on,” Servidio said. perjury over parts of Davis’ testi- Firmwide, Goodwin Procter The Second Circuit decision mony, which should lead to the New York derivatives special- has about 230 lawyers in its is posted at nylj.com. verdict being set aside. » Page 8 ist John Servidio has jumped technology and life sciences Bills to Expand Benefits for to Goodwin Procter, joining the group and another 150 in real firm’s capital markets group estate. after just 15 months at Winston Servidio brings along with Court Officers Sent to Cuomo & Strawn. him a client roster that includes AOL Agrees to Large Settlement Servidio is the second cor- Bank of America Merrill Lynch, if they’re physically assaulted or porate partner from the Chica- where he earlier served as an BY DAN M. CLARK injured while performing their go-based firm to announce an assistant general counsel, along Under Children’s Privacy Law duties. That kind of benefit is cur- exit Monday, alongside Richard with other leading dealers TWO BILLS that would expand rently not available to court offi- Frye, who is returning to Weil, including Morgan » Page 4 sites. That allowed advertisers to disability and retirement benefits cers, despite them being respon- Gotshal & Manges in Dallas. BY DAN M. CLARK place targeted ads to young chil- for court officers in New York have sible for safeguarding the state’s Servidio represents dealers and dren. The practice of collecting the been delivered to Gov. Andrew Cuo- courts. issuers in structuring derivative Ken Strutin, Technology AOL, now known as Oath Inc., personal data of children younger mo, who must decide by midnight and equity-linked capital market has agreed to pay $4.95 million than 13 years old is a violation of Friday if they will become law. transactions. Today Columnist, in penalties under violations of a COPPA, Underwood said. Leaders of two unions repre- Dies at 56 »2 Patrick “It’s exciting to join a law firm federal law intended to protect the “COPPA is meant to protect senting court officers in the state’s Cullen, that is strong and growing like personal data of children on the young children from being tracked court system are hopeful the legis- New York Goodwin Procter, because they internet—the largest settlement and targeted by advertisers online. lation will win Cuomo’s approval State Supreme have great banking relation- Follow us on under that statute in AOL flagrantly violated the this year, and one of bills has even Court Officers ships across a variety of sec- Twitter U.S. history. law—and children’s priva- earned the support of the Office of Association tors and a top base of clients New York Attor- cy—and will now pay the Court Administration. @NYLawJournal in life sciences, real estate and ney General Barbara largest-ever penalty under Cuomo has vetoed both bills technology, which are the larg- Underwood said in COPPA,” Underwood said. each year for the past four years, a news release announcing the “My office remains committed to citing concerns about the possible If they are injured on the job, settlement that AOL violated the protecting children online and will fiscal implications of the legisla- those officers are currently only Children’s Online Privacy Protec- continue to hold accountable those tion. He’s argued in his veto mes- entitled to a smaller disability tion Act by conducting billions of who violate the law.” sages that the proposals should benefit than, for example, a police auctions for ad space on hundreds Oath, which is owned by Veri- instead be addressed in the state officer who’s harmed on duty.