Monday, February 28, 2011

Thy Brother's (Book)Keeper

In a defamation action brought against an attorney who had defended a criminal matter against an embezzling former law firm employee, the New York Appellate Division dismissed claims against a third-party defendant but allowed the defense that the statements at issue were true. The court described the facts:

The plaintiff Peter J. Galasso, a partner in the plaintiff law firm Galasso, Langione & Botter, LLP (hereinafter GLB), represented Stephen Baron in his divorce action. Baron designated GLB as his escrow agent in June 2004, to hold almost $5 million in an escrow account. Peter J. Galasso's brother, Anthony Galasso, was GLB's bookkeeper. In January 2007, Anthony Galasso confessed that he had stolen approximately $4.4 million from the escrow account. The defendant third-party plaintiff, Thomas F. Liotti, is a criminal defense attorney who represented Anthony Galasso in the criminal action against him. Anthony Galasso eventually pleaded guilty to all 22 counts charged in Nassau County Indictment No. 2349N/2007 and, in his allocution, stated that the attorneys at GLB played no role in his crimes. Following Anthony Galasso's arraignment, Liotti made a statement to a reporter, which was published in the October 25, 2007, edition of Newsday, in effect, accusing the attorneys at GLB of "[d]ipping into company accounts." The plaintiffs commenced the instant action, inter alia, to recover damages for defamation. Thereafter, Liotti commenced a third-party action against the plaintiffs' attorney, Frederick K. Brewington, inter alia, to recover damages for defamation, abuse of process, and intentional infliction of emotional distress.

The defense of truth of the statements may go forward:

Liotti proffered, inter alia, an affidavit by Anthony Galasso, wherein Anthony Galasso now stated that he was "directly ordered" by the plaintiffs Peter J. Galasso and James R. Langione to "falsify disbursement expenses for clients for the express purpose of making more money for Peter [J. Galasso] and James [R. Langione]."

(Mike Frisch)

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