Criminal Law: May 2008 Archives

A trial for the ages is going on in Detroit. Geoffrey Fieger, who made his fame winning acquittals for Jack "Dr. Death" Kevorkian, and his partner Ven Johnson are on trial for their professional lives. Both are accused of recruiting 64 people, mostly employees of their law firm, to contribute $127,000 to the 2004 presidential campaign of John Edwards then reimbursing them out of law firm profits. Fieger doesn’t necessarily deny the facts the government is asserting; he claims ignorance that such payments were against the law.

        Fieger is represented by famed defense attorney Gerry Spence, now 79, who claims this is his last trial. Spence told the jury: “If the government can do this to Mr. Fieger, the government can do this to any of us." He argued that higher ups in the Justice Department were out to get Fieger, a 1998 Democratic candidate for governor, and sent 80 agents to raid his firm and confront his employees in the darkness of Nov. 20, 2005, as if Fieger and Johnson were mobsters or terrorists. "If it's a snippet, let's nip it," Spence said, adding that the Edwards campaign never gave the money back and that the IRS never reimbursed the law firm for the federal taxes it paid on the reimbursements, which it gave to employees in the form of salary bonuses. Spence said the government just wanted to nail "a name...a trophy...a big shot." 

           Responded Justice Department prosecutor Kendall Day: “Fieger thinks he's smarter than you are. No one is above the law, especially a lawyer."

Alan Milstein

The City of Canton, Ohio, wants to incarcerate high-grass violators.

Apparently, the Canton City Council wants to strengthen its existing high-grass and weeds law by making a second offense a fourth-degree misdemeanor, which is punishable by a fine of up to $250 and up to 30 days in jail.  

The existing law provides that more than 8 inches constitutes high grass or weeds. First-time violators now face a misdemeanor which carries up to a $150 fine and no jail time. The new law was prompted, at least in part, by the City’s Service Director who stated that the city is responsible for mowing about 2,400 lots which  he says costs the City a lot of money. The city spends $225,000 to $250,000 a year on cutting overgrown lots, estimated Councilman Greg Hawk who advocated taking a "hard line" on the issue.  Yes, take a hard line and lock up, clothe, feed and house the landscaping violators; no cost there.

John M. Hanamirian  

Philadelphia’s Bonnie and Clyde apparently are about to plead guilty to a variety of federal charges. United States Attorney Patrick Meehan felt the need to hold a press conference yesterday to announce he was seeking five year prison terms for the young yuppie couple who pilfered all of $119,000 from their friends and neighbors last year. Meehan called the couple, Jocelyn Kirsch and Edward Anderton, the “poster children for identity theft.” Maybe so. But one certainly questions whether the crime merits such a high profile announcement from Mr. Meehan and such a stiff sentence. Could it be just that the pair looks so good in their vacation swimsuits and looks so unlike any criminals other than that long ago famous couple who still capture the American imagination?

Alan Milstein

A Manhattan jury has the case after closing arguments in the Uma Thurman stalking trial. Jack Jordon is accused of following and sending threatening cards and e-mail messages to the actress for about two years, putting her in what she testified was fear for her personal safety. Jordon’s attorney,  George Vomvolakis, made the curious argument that because Thurman “is larger than life,” the prosecutor “went the extra mile,” and that if a member of the general public had been involved, she might  have merely kicked Jordan “to the curb,” but he wouldn’t have faced criminal charges.

Vomvolakis also even more curiously told the jury, “Think about your lives and what you have done in your lives in the name of love. Think about the stupid things you have done.”

Ok. I’ve thought about it. Still guilty. Jordon better hope Marsellus doesn't know about this.

Alan Milstein

The United States Attorney for the Southern District of New York announced today the indictment of James Treacy, former CEO of Monster Worldwide, Inc.("Monster") on charges of securities fraud and conspiracy in connection with an emploee stock option backdating scheme.  Also indicted was Anthony Bonica, Monster's former controller.

According to the indcitment, Treacy conspired with other former Monster senior executives to "systematically backdate stock option grants to Monster employees...in an effort to provide profitable options to employees without recording the required compensation expenses."

Here is how it works: The corporate officers in this case backdated stock options given to certain employees to reflect their issuance at a point prior to the actual issuance date. The backdated options reflected a price equal to the then fair market value of the stock. Because there was no difference between the stock option issuance price and fair marklet value, Monster didn't have to reflect any such difference as compensation to the employee to whom the option was granted. That fraud allows them to eliminate the expense of having given the option to the employee which makes their profit and loss statement look better; more income less expenses. Everyone's happy. The employee gets his stock, the company has no concomittent expense recording obligation. Oh, unless, of course, you abide the law and every governing accounting principle in existence.

John M. Hanamirian