Ciavarella’s Sentencing Set for August 11

The sentencing date has been set for a disgraced northeastern Pennsylvania judge convicted of taking $1 million in bribes from a real estate developer who built a pair of private juvenile detention facilities.

A federal judge scheduled the sentencing hearing for former Luzerne County Judge Mark Ciavarella for August 11.

Ciavarella was convicted in February of counts including money laundering and wire fraud as part of the scheme involving another judge.

Prosecutors alleged Ciavarella and former county President Judge Michael Conahan ran a kickback scheme involving the closure of the county-run juvenile facility and the construction of two private detention centers. Conahan pleaded guilty to racketeering last year.

The scandal prompted the state Supreme Court to throw out thousands of juvenile cases handled by Ciavarella.

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Sentencing Scheduled for Corrupt Ex-PA Judge

>Rothstein Protected for Six Months

>Lawyers seeking damages for the victims of admitted Ponzi schemer Scott Rothstein must wait until December to question him, a judge in Florida ruled.

Rothstein, sentenced to 50 years in prison for his crimes, is in protective custody and cooperating with prosecutors. U.S. District Judge James Cohn refused to shield him from questioning entirely in civil cases involving his fraud but granted a prosecution request for a delay, the South Florida Sun Sentinel reported.

Until his empire came crashing down, Rothstein appeared to be one of South Florida’s most successful lawyers. His firm, which employed 70 lawyers, had offices in Boca Raton, Miami, West Palm Beach, Fort Lauderdale and Tallahassee as well as New York and Caracas and had major corporate clients.

When he pleaded guilty, Rothstein admitted the law firm was kept afloat through an investment business that he used to steal millions of dollars.

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Judge Protects Ponzi Schemer for 6 Months

>Ciavarella and Conahan May Face Different Sentences

>Former Luzerne County Judge Mark A. Ciavarella Jr. has joined his co-defendant, former Judge Michael T. Conahan, in awaiting sentencing after a federal judge denied his post-trial motions late last month.

But white-collar defense attorneys and former federal judges not involved in the case said Conahan and Ciavarella could end up receiving very different sentences.

In February, a federal jury in Scranton found Ciavarella guilty of 12 of 39 counts of corruption filed against him, including racketeering, racketeering conspiracy, honest services mail fraud, money laundering conspiracy and a host of tax fraud charges. Ciavarella was cleared of extortion, bribery and honest services wire fraud charges, however.

Conahan pleaded guilty to one racketeering charge in April 2010.

Stephen S. Stallings, chair of Pittsburgh-based Burns White’s white-collar criminal defense group, said the sentencing guidelines for Ciavarella are likely to be significantly higher than those for Conahan, and not just because he was found guilty of more crimes than Conahan pleaded to.

Stallings said the nature of Ciavarella’s crimes, including that he was a public official, would initially set the bar high, while a number of potential enhancements under the U.S. Sentencing Guidelines could then raise the sentencing levels further

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Ciavarella and Conahan May Face Very Different Sentences

>Conahan Withdraws Bid to Collect State Pension Benefits

>Former Luzerne County Judge Michael T. Conahan, awaiting sentencing for racketeering conspiracy in the kids-for-cash case, has withdrawn his bid to collect state pension benefits.

Conahan, 59, had challenged a ruling by the State Employees’ Retirement System, which cut off his $8,000-per-month pension in May 2009 and sought reimbursement of about $2,400 he received between his January 2009 arrest and the ruling.

Conahan withdrew that challenge in April, offering no reason for the withdrawal, according to Robert Gentzel, a spokesman for the system.

Conahan attorney Philip Gelso declined comment Thursday [6/2/11].

Conahan faces up to 20 years in prison after pleading guilty to accepting $2.8 million in bribes and kickbacks from the builder and co-owner of a for-profit juvenile detention center. Prosecutors say Conahan and a co-defendant, former county Judge Mark A. Ciavarella Jr., conspired to close a county-owned center and used their influence to send juveniles to the for-profit center.

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Conahan Ends Bid to Collect Pension

>Federal Judge Suggest No Insurance Duty in ‘Kids-for-Cash’ Civil Cases

>The federal judge who is overseeing the civil rights suits filed in the wake of the “kids-for-cash” judicial corruption scandal in Luzerne County has handed down a pair of opinions in favor of insurers who are refusing to provide any coverage for the cases.

The rulings by U.S. District Judge A. Richard Caputo stopped short of declaring that the insurers have no duty to provide coverage, but included strong hints that such a judgment would follow.

Instead, in both opinions – Markel International Insurance Co. v. Western PA Child Care and Alea London v. PA Child Care – Caputo was ruling on motions to dismiss the suits filed by the insureds, and the judge’s rejection of those motions means only that the suits may now proceed.

But the conclusory language used by the judge in explaining why policy exclusions would apply to bar any coverage seems to suggest that a final judgment in the insurers’ favor is now a mere formality.

Lawyers for the insurers in both cases said the defendants will be required to file formal answers to the suits and that the insurers will soon after file motions for summary judgment.

Such motions appear nearly certain to be granted, based on language in Caputo’s recent opinions.

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Judge Suggests No Insurance Duty in ‘Kids-for-Cash’ Civil Cases

>Ciavarella Hangs Acquittal Arguments on Evidentiary Issues

>Arguing that evidence submitted by the federal government was both time-barred and insufficient, former Luzerne County Common Pleas Court Judge Mark A. Ciavarella Jr. has petitioned a federal court judge to overturn his racketeering and honest services fraud convictions.

Ciavarella wrote that he should be acquitted of those major charges, which would leave him guilty of only tax fraud charges, or provided a new trial.

The former judge used a 20-page brief to support a series of motions that were filed last month, alternately challenging U.S. District Judge for the Middle District of Pennsylvania Edwin M. Kosik’s discretion in overseeing the case and the strength of federal prosecutors’ evidence against him.

The former judge was accused by federal prosecutors in January 2009 of concocting a “kids-for-cash” scheme with Conahan and taking more than $2.8 million from Mericle and Robert J. Powell, the builder and former co-owner of Pa. Child Care, a for-profit juvenile detention facility.

A jury, however, only found Ciavarella took $997,000 from Mericle in his capacity as a judge, conspired to launder that money and lied about it on his tax returns.

Conahan pleaded guilty to a racketeering charge in an open-ended agreement with federal prosecutors.

Mericle and Powell also admitted wrongdoing for their roles in the case.

Now, Ciavarella is hinging his appeal, in part, on Kosik’s decision to bar him from mentioning Zubrod’s contention that Mericle’s payment was “not a kickback or a bribe in any sense.”

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Ciavarella Hangs Acquittal Arguments on Evidentiary Issues

>Guardian Appointed for Real-Estate Magnate Michael R. Mastro for Federal Bankruptcy Court

>Former state Supreme Court Justice Faith Ireland has been appointed guardian for incapacitated Seattle real-estate magnate Michael R. Mastro in an upcoming trial in federal bankruptcy court.

Mastro, who was forced into what probably is Washington’s largest bankruptcy ever in July 2009, suffered severe head injuries in a fall at his Palm Desert, Calif., home last month. The 85-year-old isn’t capable of managing his personal or business affairs, his neurologist has stated, and his prognosis is unclear.

Mastro’s injury came weeks before the scheduled trial of a lawsuit filed against him by James Rigby, the court-appointed trustee charged with finding and liquidating Mastro’s assets and distributing proceeds to his creditors.

In the lawsuit, Rigby contends Mastro, anticipating bankruptcy, schemed to put some assets, including his Medina waterfront mansion, out of most creditors’ reach. Mastro has denied the allegations.

As guardian, Ireland will make decisions on Mastro’s behalf concerning the lawsuit and provide direction to his lawyers.

The guardian will be paid from Mastro assets not covered by the complex bankruptcy proceeding.

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Former Justice Appointed Guardian for Mastro in Upcoming Trial

>Assisted Living Advocate Calls for More Public Funding, Less Federal Regulation of the Industry

>The issues facing Medicaid coverage in assisted living are fundamentally economic, not regulatory, according to at least one participant in Tuesday’s roundtable discussion on assisted living held by the Senate Special Committee on Aging.

“Sub-market payment rates, lack of payment for room and board, and restrictive state policies are the root causes of limited options for low-income seniors in many states,” according to Howie Groff, president of Tealwood Care Centers and immediate past chair of the National Center for Assisted Living. “It is imperative for policymakers to consider ways to expand the availability of affordable assisted living and to help states cover the funding gaps that currently exist.”

Speaking on behalf of NCAL, Groff recommended to the roundtable that the Department of Housing and Urban Development create vouchers to cover the room and board portion of assisted living, and that more public financing be made available to build affordable assisted living projects. He also expressed NCAL’s support of continued assisted living regulation at the state level, arguing that state regulations are more easily adaptable to the changing needs of assisted living residents.

Groff also cautioned the group against excluding assisted living facilities from the Medicaid program. Such a move could reduce care options and discriminate against those with Alzheimer’s disease or dementia, he said.

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Assisted Living Advocate Calls for More Public Financing, Less Federal Regulation of Industry

>Federal Judge Rules Johnson & Johnson May Be Liable for Paying Kickbacks

>A federal judge’s ruling[2/25/11]that Johnson & Johnson (JNJ) may be liable for paying kickbacks to nursing homes that prescribed the antipsychotic Risperdal is a reminder that just because you signed a contract doesn’t mean the contract is legal.

J&J thought it could evade the anti-kickback statute because it signed an agreement that didn’t directly involve sales of Risperdal. The judge, however, said that contract was merely a “subterfuge” to disguise kickbacks meant to encourage the prescribing of Risperdal.

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JNJ May Be Liable for Antipsychotic Kickback Scheme

>Ciavarella Found GUILTY!

>Former Luzerne County Common Pleas Court Judge Mark A. Ciavarella Jr. has been found guilty of 12 of 39 counts of corruption filed against him, a federal jury in Scranton announced today.

The 12 men and women, who deliberated for an estimated 12.5 hours, returned to U.S. District Judge for the Middle District of Pennsylvania Edwin M. Kosik’s courtroom to announce their findings, which included decisions that Ciavarella was guilty of racketeering, racketeering conspiracy, honest services mail fraud, money laundering conspiracy and a host of tax fraud charges. Ciavarella was cleared of extortion, bribery and honest services wire fraud charges, however.

In the indictment, Ciavarella was charged with racketeering, racketeering conspiracy, four counts of honest services wire fraud, four counts of honest services mail fraud, 10 counts of corrupt receipt of bribe/reward for official action concerning programs receiving federal funds, money laundering conspiracy, five counts of money laundering, eight counts of extortion under color of official right, conspiracy to defraud the United States and four counts of subscribing and filing a materially false tax return.

Ciavarella admitted during testimony on Tuesday that he was, in fact, guilty of filing false tax returns for tax years 2003, 2005 and 2006 as alleged by prosecutors. Prosecutors also argued during trial that Ciavarella filed a false return for tax year 2004, but Ciavarella is disputing that charge.

He fought the majority of the charges by arguing that the kickback alleged by prosecutors was no more than a finder’s fee paid by Mericle as a thank you for putting him in touch with Powell. He fought the extortion claims by attempting to insulate himself from the actions of fellow former Luzerne County Common Pleas Court Judge Michael T. Conahan and claiming that any money paid by Powell was for the use of a condominium owned by a company controlled by the former judges’ wives.

Conahan, who faced an equally damning indictment and opted to plead guilty to one racketeering charge in relation to the alleged crimes, was a name that arose often during the trial. He was, however, conspicuously absent in person.

Neither side called him as a witness.

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Ciavarella Guilty of Racketeering