Milton Allimadi - November 15, 2002
This is a story of how greed, betrayal, theft and corruption continue to rapidly erode the public's confidence in New York's judicial system, says a lawyer who insists he's a victim of the courts. It's also the story of one man's lonely but determined fight for justice albeit at a tremendous physical and financial toll. The story amounts to a call for New Yorkers to finally rise up in protest against the gutterization of justice by corrupt judges.
Some prime characters involved include the notorious judge, Richard D. Huttner, of State Supreme Court. Formerly in Brooklyn, Huttner was re-assigned to Queens after the New York State Committee on Judicial Conduct censured him for unethical conduct (more details in a follow-up report next issue). Huttner established a reputation for cronyism by steering lucrative receiverships with millions of dollars in fees and billings to lawyers and companies close to him. Huttner has been the subject of previous Black Star News articles documenting his cronyism and has never returned a phone call seeking comment. More recently, the extent of corruption in New York's courts was highlighted when former Supreme Court Judge Victor Barron was sentenced to three years behind bars. Barron confessed to extorting tens of thousands of dollars from a lawyer by refusing to sign off on a settlement he presided over unless the lawyer forked over a portion of the proceeds. Cynically, Judge Barron gets to keep his almost $100,000 annual pension.
The case before The Black Star News today started in 1984 when Israel Weinstock, an attorney who had been practicing law since 1960, represented 4200 Avenue K Realty Corp. The company wanted its contract to acquire two Brooklyn properties for $1.9 million enforced by the Court. That case eventually morphed into a legal vendetta against Weinstock by one of the nation's largest law firms, Cleary Gottlieb Steen & Hamilton (Cleary Gottlieb) and, Weinstock contends, the numerous judges the firm was able to influence. "At the end of the day I was denied due process and equal protection of the laws," Weinstock said. Ultimately, he was disbarred on April 8, this year, in order to silence him, he said. He is now preparing a lawsuit in which he contends certain powerful individuals participated in the concerted actions to deny him justice. And given the fact that both sides in this issue can't be right, then surely it's incumbent upon federal authorities to investigate the matter.
A Judge Who Wouldn't Judge
At the start of the original 1984 trial Judge Nicholas Clemente conceded before both parties that a judge involved in the Trial Assignment Part (TAP) made brief mention to him about the case. With no objection, the trial proceeded. Shockingly, at the conclusion, Judge Clemente refused to render a verdict and recused himself. "This was outrageous," Weinstock recalled in an interview. "Never in the history of New York has there been a judge who recused himself for reasons he knew before the trial."
Weinstock appealed, demanding that Judge Clemente be compelled to render a decision. The appeal was rejected and the case was re-tried before Justice Barry Hurwitz the verdict went against Weinstock's client 4200 Avenue K Realty Corp. which was owned by one Jack Walker. At that trial Walker testified as the sole owner of the corporation. Justice Hurwitz has since died. (Walker didn't return a phone call seeking comment from The Black Star News).
But while Weinstock was preparing for the retrial of the case before Justice Hurwitz, the partners of the law firm that had retained Weinstock for the trial of the case had an acrimonious falling out, he said. The law firm was known as Handler, Sukenik, Segal & Graff. The quarrel was between Emmerich Handler in one corner and Sukenik Segal & Graff in the other corner. While Weinstock was representing Walker in connection with the Avenue K Corporation, Walker sued Weinstock alleging fraud. In that lawsuit, Walker was represented by one of Handler's long time friends and attorneys Robert Gutman, a Court Street attorney, Weinstock said. Notwithstanding the fact that Walker was suing Weinstock for fraud, Walker insisted that Weinstock continue to represent him with the Avenue K properties. Weinstock at first refused, but subsequently relented when Walker assured him that the case against him for fraud was instigated by Handler as a means to pressure Weinstock's friends Sukenik Segal & Graff into surrendering their claims against Handler. Walker claimed that he was being blackmailed by Handler and thus had to comply with Handler's demands, he said. Weinstock agreed to proceed with the Avenue K lawsuit and to "shelve" the second lawsuit which would be dealt with after the Realty Corp trial. Weinstock told Walker that he would counter sue and that he would demand damages for Walker having commenced the completely contrived, frivolous and phony lawsuit and had falsely accused Weinstock of fraud.
After Justice Hurwitz decided the case against Walker's Realty Corporation, Walker sought to settle any possible claims by Weinstock for Walker having initiated "the phony lawsuit," he said. Walker tendered his apology under oath and admitted in writing that any allegations of wrongdoing on the part of Weinstock were "totally false" documents show. Weinstock, who had never been charged with fraud or any ethical violation whatever in his decades of practice, demanded $2 million.
Walker instead offered the 80% balance of Avenue K Corporation which had lost its case to enforce the contract for the purchase of the properties. Walker had previously granted Weinstock a 20% stake as a contingent fee for the trials of the case and related matters. Weinstock reluctantly accepted Walker's proposal, as the corporation was worthless unless an appellate court were to reverse the decision of Justice Hurwitz. Such an appeal would require the expenditure of substantial funds, he said.
Sharks Smell the Blood
Following the foregoing settlement with Walker, Weinstock, at his own cost and expense of thousands of dollars filed an appeal to reverse the adverse decision rendered by Justice Hurwitz. In1986, the Appellate Division, Second Department, unanimously reversed the decision of Justice Hurwitz on the "facts and the law." The decision required that the seller render an accounting to the purchaser (Realty Corp) for all of the seller's profits made during the six years of litigation. Weinstock, with the ownership of Avenue K Corp., could now acquire the Brooklyn properties with little or no payment, as the profits generated by the properties during the six years would have offset the required payment for the purchase of the properties. Moreover, the value of the properties had now doubled. "It was a tremendous decision in my favor," Weinstock recalled. Weinstock never got a chance to celebrate. He was diagnosed that year with stomach cancer - one of the most lethal forms of the disease. "No one expected me to survive," he recalled. While he lay on his deathbed, in September 1986, Handler recruited Walker to initiate a second lawsuit against Weinstock asserting that 19 months earlier Weinstock had "coerced" Walker into signing over the ownership of Avenue K Corp. Handler retained Cleary Gottlieb Steen & Hamilton and also retained other Handler attorneys, Schlam Stone & Dolan, to represent Walker, he said. "Now that the company had great value, the sharks were circling," Weinstock said. George Weisz, senior partner at Cleary Gottlieb proposed a temporary détente, in writing. "Weisz said "Look we have a common interest in getting the property away from the seller," Weinstock recalled." As far as Handler's claims, some of the corporate stock, why don't we decide that later? Let's preserve the status quo." After extensive surgery and aggressive chemotherapy, Weinstock suffered a heart attack in 1987. But miraculously, he recovered from his medical setbacks. In 1988, Weinstock asked Weisz about the status of Avenue K Corp. "He told me - We don't have to tell you anything," Weinstock recalled. "Then in 1990 I found out that in 1987 Handler had borrowed $3.8 million from the First Nationwide Bank and used the property as collateral - transferring the corporation's buildings to his or his wife's company with a forged deed. He subsequently gave Cleary Gottlieb the sum of $500,000." That same year, Weinstock filed claims against Cleary Gottlieb, Schlam Stone & Dolan and others, alleging mail fraud and wire fraud amongst other charges. "In his l987 bank application Handler had lied," Weinstock explained. "Handler certified that his wife Rita was a 90% owner of stock in the corporation. In his application for the mortgage, he certified that neither he nor his wife were involved in any litigation - when in fact he was involved in litigation with the very property against which he sought to borrow $3.8 Million." While the FBI investigated the bank fraud, no prosecution followed. Cleary Gottlieb retained Bernard Nussbaum, Esq., who was soon to be named Special Counsel to President Bill Clinton and Acting Attorney General, Weinstock said.
A Notorious Judge Takes Control
The case started by Handler and Walker against Weinstock in 1986 ended up before Justice Huttner. Justice Huttner initially referred the case to a Kings County Supreme Court Judicial Hearing Officer ("J.H.O.") Irving Kramer, the question of whether Weinstock could claim 20% of 4200 Avenue K realty Corp.
"When it came to him Judge Kramer did not want to hear it as a Judicial Hearing Officer since they work per diem at a rate of about $250 per day. He wanted to hear it as a referee who hear cases on an hourly rate," Weinstock said. During a hearing before the judge, Weinstock deliberately showed up with his friend who held a notebook in her hand to give the impression that she was a reporter, he said. "Kramer got cold feet and sent the case back to Huttner. Crooks fear light; judges fear exposure." Kramer has been featured in previous Black Star News reports in which he was accused of corrupt rulings. "Only after I provided Justice Huttner with incontrovertible proof overwhelmingly demonstrating my right to 100% of 4200 Avenue K Realty Corp., did the judge allow me to claim not only 20% but the full 100% of 4200 Avenue K Realty Corp," Weinstock added. "Huttner then directed that the case be decided by one of his cronies, Lewis Douglass, instead of sending the case back to the Trial Assignment Part to be randomly assigned. Justice Douglass not only ruled in favor of Handler, but also somehow decided that - Handler was at all times the 100% owner of the property - even though Handler himself had never claimed more than 48%. Indeed, he claimed 48% jointly with another, thus less than 48% for himself. Douglass also decided that what Walker gave me was a $4 million building and therefore I had made an unconscionable deal." A claim that had never been asserted against him, Weinstock noted. "Justice Douglass ignored the fact that Walker did not give me any building at all; let alone a $4 million building," Weinstock added. "What Walker assigned to me was stock in the Realty Corp., which stock was at that time worthless, the corporation having lost its right to enforce the contract to purchase the buildings. Only if the corporation would succeed on appeal, could the corporate stock become valuable. The cost of an appeal would cost thousands of dollars and Walker was unwilling to risk any money for any appeal." It was only after Weinstock won the appeal which he filed at his own expense that Handler recruited Walker to reclaim what Walker had admittedly, voluntarily and knowingly assigned to Weinstock, he said. Justice Douglass also ordered the non-publication of a two-page addendum to his own March 13, 1997 ruling on the case; the addendum, Weinstock contends, "Contradicts his March 13, 1997 Order in major respects such as that Handler received a 60% interest from Walker who was the owner."
Handler, in an interview with The Black Star News said Justice Douglass's ruling was unambiguously clear in his favor and that it was affirmed by the Appellate Division. He accused Weinstock of carrying out a 17-year campaign against him. He added that Justice Douglass called Weinstock's deal with Walker was "unconscionable" and "grossly unfair" and that he had "no claims whatsoever." Weinstock's own federal complaint against Cleary Gottlieb was dismissed without prejudice on technical grounds in 1992, he said. He immediately initiated a new lawsuit, in New York County. Cleary, Gottlieb then moved to transfer the case to Judge Huttner who immediately granted the motion, he said.
Armed with Walker's sworn confession that his original lawsuit alleging fraud had been concocted, Weinstock now asked Judge Huttner to grant a summary judgment. "Handler himself conceded that I may own at least 32% of the corporation," Weinstock recalled. "Huttner nonetheless denied my motion for summary judgment." As further proof of Judge Huttner's bias, Weinstock contends, at an earlier stage, on May 11, 1993, the judge entered an Order sanctioning Weinstock $1,500. This was after his associate had made a statement in support of Weinstock's motion to have the lawsuit against him dismissed. "The dismissal motion was made on the ground that a threat to sue, which was the basis for the claim by Walker in their lawsuit that I coerced him into signing over 80% of 4200 Realty Corp., could not as a matter of law constitute coercion under New York law," he said. The sanction order, made sua sponte, without any request from the opposing parties, "was so outrageous, blatant and unwarranted that it was immediately stayed even by the biased Appellate Division," he said.
Doesn't Government Want its Money Back?
Even with this setback, Weinstock continued his quest through another arena. "I knew that if I could get an unbiased hearing somewhere things could begin to change," he said. Weinstock learned that Handler and his wife Rita owed the FDIC $500,000; with $200,000 in interests the total had grown to $700,000, he said. Weinstock purchased the government debt at a discount. "I knew Handler had money so I started proceedings to enforce that judgment for two reasons; to recover some of the money I had lost and to expose that Handler had been lying to the courts," he said. "U.S. District Court Judge Robert Patterson for the Southern District of New York found, in a September 28, 1998 statement on the record, that Handler and his aiders and abettors had fraudulently concealed assets in defrauding my attempts to enforce the judgment due and owing by Handler and that Handler had committed perjury in his responses to the Federal Court," Weinstock said. "The judge found Handlers answers to the questions so fraudulent that he threatened him with jail. Judge Patterson thereupon referred Handler's conduct to the United States Department of Justice for criminal prosecution."
Handler in the interview with The Black Star didnt deny owing money to the government. He said Justice Patterson could "not prove" that he had money and that the judge didn't even question him.
Handler hired top-notch "well connected and self-described prestigious" criminal defense lawyers, including a former U.S. Attorney and Assistant U.S. Attorneys and also declared bankruptcy, Weinstock said. Thereupon, Handler's attorneys filed charges against Weinstock with the Disciplinary Committee. "That ultimately lead to my disbarment," he said.
For some unknown reason the U.S. Attorney abandoned the investigation ordered by U.S. District Court Judge Paterson. Weinstock has filed a lawsuit in the U.S. District Court for the Eastern District of New York to compel the U.S. Attorney to present evidence of the criminal conduct on the part of the various participants in this affair, records show. Although the U.S. Attorney was served in May 2002, (Weinstock v. Mauskopf, et al.) Case No. CV-02-3060, (E.D.N.Y.), the U.S. Attorney has not yet responded or taken any action, except requested extensions of time to answer or make any motions, he added.
Disbarment as a Muzzle?
He insists he was disbarred not for any credible legal transgression but simply because the New York State Grievance Committee for the Second and Eleventh Judicial Districts and the Appellate Division wanted to "protect Cleary Gottlieb and its former senior partner George Weisz from criminal liability." Cleary Gottlieb boasts more than 500 lawyers, including former judges, he said. Weisz has since retired.
The grounds for Weinstock's disbarment were that: he had taken a 20% interest in a subject matter of litigation (Avenue K Realty Corp.); that he was guilty of coercion and duress against Walker (although Walker had confessed that the same claims were fabricated), by acquiring the 80% ownership of Avenue K Realty Corp. as part of his settlement deal with Walker in 1985; and, that in connection with his matrimonial trial, he had allegedly taken one appeal to harass his former wife. "The only case in New York where an attorney is disciplined for taken one single appeal," Weinstock has asserted. "So Handler believed he had gotten away with screwing me for the millions and screwing the government for millions from the FDIC case," Weinstock recalled.
In the meantime, Handler had also sued Weinstock for slander after Weinstock had called him a "thief" and a "crook" who had defrauded him and the US government. But at the conclusion of the trial this summer, in July 2002, a jury ruled that Weinstock had not defamed Handler. "Because Handler indeed was a thief who had, together with his attorneys, swindled me out of millions of dollars," he said. Mel Barkan, Esq., former Chairman of the New York Civilian Complaint Review Board, represented Handler and his partner Samuel Roth, a pricey attorney, although Handler claimed under oath to be impoverished. The jury decided that Handler was a one man crime wave and Roth was his partner in crime," he said. The jury decided that Weinstock had not met the burden of proof on only three of the 15 charges that Weinstock had made against Handler and for that Handler was awarded a nominal $1.
Handler, on the other hand, said the fact of the $1 award shows that he was the one who prevailed. "He can say whatever he wants," he said, of Weinstock. He added that his partner Roth wouldn't be interested in discussing the matter.
"Weisz testified at this trial that he was not complicit in the Handler swindles," Weinstock added. "The jury unanimously rejected the testimony of Weisz. It was determined that Handler and his attorneys had swindled me. This was the first time that a jury heard a case involving this matter," Weinstock said. "I'm now disbarred for insisting that I'm right when a jury unanimously said I'm right. Legally the Appellate Division should say we made a mistake and Weinstock should not have been disbarred."
Publisher's Note to readers: Part II of this report details how the Appellate Division disbarred Weinstock for the alleged actions that had occurred 15 years before and, separately, our report will examine the case that caused Judge Huttner's re-assignment. The questions we raise are: How does Judge Huttner have the gall and authority to continue sentencing any citizen after his own transgression? Why should he continue to collect taxpayer-funded salary? Have his decisions been based on the law or have they been based on other non-judicial considerations? We've maintained for long now that a federal inquiry is warranted. Readers should also report all documented cases of judicial corruption to Milton@blackstarnews.com.