Monday, December 12, 2005
Here's a phrase I hadn't heard before that comes in the context of Special Counsel Patrick Fitzgerald's questioning of Viveca Novak of Time about her conversations with Robert Luskin, the attorney for Karl Rove. According to Novak's first-person account of her questioning (here) by Fitzgerald :"I would discuss only my interactions with Luskin that were relevant to the conversation in question. No fishing expeditions, no questions about my other reporting or sources in the case. He [Fitzgerald] agreed, telling my lawyer that he wanted to 'remove the chicken bone without disturbing the body.'" What a quaint analogy (or maybe a simile?). After Fitzgerald's initial interview, Novak hoped to avoid any further interaction with the Special Prosecutor, but she was then deposed under oath. It is now clear that her conversation with Luskin about Rove being a source for fellow Time reporter Matthew Cooper is what sent Rove back to the grand jury a second time to clarify his earlier testimony about who he discussed the identity of CIA operative Valerie Plame with in June 2003.
This aspect of the case seems to be more of a minor side-show than anything of real significance because Rove did correct his testimony without being prodded by Fitzgerald's office, which may have overlooked or never received an e-mail Rove sent to another White House official discussing his conversation with Cooper. Luskin clearly provided quite effective representation to his client by doing a thorough investigation after speaking with Novak and bringing new information to the Special Prosecutor's attention, which is much preferable to having it be the other way around. A perjury charge against Rove would be almost impossible to win, or even convince a grand jury to find probable cause.
In the usual tit-for-tat among those who feel they've been burned, albeit by a lawyer doing his best to represent his client, Novak's article ends with a "final note" that largely amounts to sticking her tongue out at Luskin:
Luskin is unhappy that I decided to write about our conversation, but I feel that he violated any understanding to keep our talk confidential by unilaterally going to Fitzgerald and telling him what was said. And, of course, anyone who testifies under oath for a grand jury (my sworn statement will be presented to the grand jury by Fitzgerald) is free to discuss that testimony afterward.
So there! (ph)
It is interesting to see how some individuals will move from one scheme to the next and still be able to lure investors, sometimes even boasting about how they've tangled with the law. Vladislav "Steven" Zubkis was charged with 36 counts of mail/wire fraud and money laundering in the Southern District of California related to two construction projects that did not pan out. A San Diego Union-Tribune story (here) discusses other problems Zubkis has had with some of his business ventures, including a current venture involving a luxury time share in Baja California that may not exist. The SEC obtained a judgment against Zubkis in 2001 related to a fraudulent scheme involving the Stella Bell Corp., including an order to pay over $21 million in disgorgement and prejudgment interest (see Litigation Release here). Zubkis filed for bankruptcy in October (joining the rush to avoid the revised bankruptcy laws, no doubt) in a move the SEC claims is designed to avoid paying the earlier judgment, for which the Commission has already seized a 75-foot yacht (see Litigation Release here). Zubkis is being held after a bail hearing in which the government asserted he was a flight risk, and it's unlikely he'll be able to meet any significant bond requirement because that will draw the SEC's attention to the assets to pay the earlier judgment. (ph)
Two recent articles discuss lawyers who find themselves on the wrong side of the case in federal prosecutions. In Baltimore, Christopher Linas, a former part-time assistant prosecutor, was charged with one count of conspiracy to distribute and possession with intent to distribute cocaine (including crack cocaine) and heroin. An article in Ocean City Today (here) discusses the charges. Brent Wood, an attorney in Raleigh, North Carolina, did not lose his license despite pleading guilty to a misdemeanor failure to file a tax return charge, but he goes on trial in January 2006 on fraud charges related to an alleged ponzi scheme that cost investors approximately $15 million. A Raleigh News & Observer story (here) discusses the charges. It sounds like both lawyers may have gotten caught up with their clients, a dangerous proposition. (ph)
Sunday, December 11, 2005
The USA of the District of Columbia announced this week a guilty verdict of an individual to conspiracy to violate the US trade embargo against Iran and to illegal exports to Iran. (press release). According to this press release "[h]e faces a likely range of 97 to 121 months in prison under the federal sentencing guidelines. A co-defendant in this case was found not guilty. A third individual has charges still pending against him.
Trade embargoes exist for national security and economic concerns. But it is particularly interesting to see that the Commerce Assistant Secretary for Export Enforcement states in this press release that:
"The embargo on Iran is an important part of our Nation's foreign policy interests. We want to do all that we can to discourage Iran's sponsorship of international terrorism and active pursuit of weapons of mass destruction. We will continue to vigorously pursue cases like this one."
In this case, the agreement pertained to supplying "forklift and tow tractor parts."