Thursday, September 30, 2010

Denying Discovery: A Favorite Tool for Cheating Litigants in Court

Alabama Governor Bob Riley recently decided to settle a lawsuit rather than give testimony under oath. A Riley spokesperson said the governor made the decision only because he wanted to save taxpayers the expense of protracted litigation. But as Bob Gambacurta of the Montgomery Independent pointed out, Riley had serious personal reasons for avoiding sworn testimony--and they had nothing to do with concerns about taxpayers.

Riley and his lawyers tried to protect him from testifying by having the judge dismiss the case. But when the judge refused and set a tight deadline for completion of depositions, Riley was stuck--and so he caved.

This episode reminds us of three truths about discovery--the portion of a lawsuit that is designed to help uncover facts. Common discovery tools include depositions, interrogatories, subpoenas, and requests for production of documents.

What are the three truths of discovery?

* If you are in the wrong, as Riley almost certainly was, discovery is your worst nightmare.

* If you are in the right, discovery--at least in theory--should be your best friend.

* In a world of corrupt judges and lawyers, discovery is the No. 1 area where deserving litigants are likely to get cheated.

How do I know? I've been there and had it done to me--more times than I care to count.

How does it work? Here are a few techniques that are commonly used to ensure that the truth is obscured in court:

* The Solo Screw Job--This one almost has to be performed by the judge because he/she is the only person who has the authority to pull off a one-person show. This is likely to involve a Motion to Dismiss. In legal parlance this is known as a Rule 12(b)(6) motion--failure to state a claim for which relief can be granted. Pleading requirements have been heightened recently, going slightly beyond the "notice pleading" rule that has been in place for years. But under the law, a Rule 12(b)(6) motion still should almost never be granted. Such a motion, if granted, essentially cuts off a case before it gets started--and ensures that discovery will not take place. That's why Riley's lawyers filed a 12(b)(6) motion, and that's why it's a favorite tool of other scoundrels who have cheated someone. In fact, a defendant who files a 12(b)(6) motion is essentially saying, "Yes, I screwed this person, and I'm going to try to pull every technicality in the book to make sure I get away with it!"

Issues related to immunity or statute of limitations are usually the only legitimate reasons for a judge to even consider a Motion to Dismiss. And many times, discovery is required to determine if those defenses are legitimate.

Still, judges sometimes will unlawfully grant such motions to protect their favored constituents--namely, members of the legal community. I saw this happen in the legal-malpractice case I brought against Jesse P. Evans III and Michael Odom, the lawyers I originally hired to defend me in the bogus lawsuit brought by our neighbor. I laid out my claims in significant detail, going way beyond the level required to overcome a Rule 12(b)(6) motion. Lawyers from Starnes and Atchison, representing Evans and Odom, surely knew that. But they filed the motion anyway, hoping that Judge Robert Vance would want to protect his lawyer buddies and make sure they didn't have to answer questions under oath. The Starnes lawyers were right; Vance granted the motion and completely ignored black-letter law in the process.

(By the way, we covered the Starnes firm yesterday in a post about a pedophile in the U.S. Justice Department. The Starnes folks associate themselves with only the classiest people. And when journalist Margie Burns attempted to question them about that association, they developed a remarkable case of amnesia. Burns has more coming on that story, by the way. We can't wait.)

* The Double Screw Job--This usually happens when the judge is buddies with opposing counsel. A classic example came when I filed a counterclaim against our criminally inclined neighbor Mike McGarity. William E. Swatek, McGarity's lawyer with a 30-year record of unethical behavior, plays golf with Shelby County judges--and God only knows what other favors are passed back and forth. When I sought to conduct discovery on our countersuit, Judge G. Dan Reeves simply cut it off. He declared that discovery was over, even though it wasn't past the deadline, and we were moving ahead to trial.

* The Triple Screw Job--This is when the judge, opposing counsel, and your own lawyers all are working against you. I've experienced this one several times, the most recent coming in our lawsuit against unethical  debt collectors NCO and Ingram and Associates. Allan Armstrong and Darrell Cartwright, our so-called lawyers, informed Mrs. Schnauzer and me that we would not be conducting any depositions. (I should have known something was up right then.) When the other side continued to stall on answering our requests for production of documents, Armstrong and Cartwright refused to push. When I repeatedly suggested that we file a motion to compel, the response was, "Well, judges don't like discovery disputes, so it would be best for the parties to work this out among ourselves." Except it never got worked out, and evidence suggests our lawyers didn't even try very hard. In our answer to the defendants' motion for summary judgment, they simply noted that discovery was not complete and requested additional time if the judge had any inclination to grant the motion. You can guess what happened next: The judge ignored the notation and proceeded to screw us. How did Armstrong and Cartwright react? When I questioned them about the bogus ruling and demanded that they file a post-judgment motion, they violated our attorney/client privilege, broke the contract we had with them, and withdrew from the case.

Armstrong and Cartwright are the same characters who acknowledged that we'd had horrible experiences with lawyers, that we had every reason to be suspicious about anyone in the "profession," but asked us to "trust" them. They really wound up earning our trust, didn't they?

I will be writing much more about this episode. But the bottom line is this: Mrs. Schnauzer and I have indisputable, tape-recorded evidence of both state-law fraud and federal-law claims against NCO and Ingram and Associates. But thanks to our own lawyers joining forces with the other side--which includes such "luminaries" as Laura Nettles of Lloyd Gray and Whitehead and Wayne Morse of Waldrep Stewart and Kendrick--we never came close to completing discovery. As a result, we wound up getting screwed--from three different directions.

(By the way, one of the opposing lawyers has developed a habit of repeatedly sending me snide, anonymous remarks about this case. It's clever, taunting little things like, "Hey, how is your debt-collection case going?" Apparently it gives her a sense of pride to have a judge rule unlawfully in her favor--to "win" a case because the other party is cheated, not because of any ability she has as an attorney.

(These communications almost certainly are a violation of the Alabama Rules of Professional Conduct. But this woman, like many lawyers, wouldn't know professional conduct if it bit her on the ass. I've invited her to identify herself, and I will engage her in a public debate--open to all Schnauzer readers--about the facts and law in the case. Haven't heard back from her.

(I also asked her if she has knowledge about what caused my wife to be cheated out of her job at Infinity Property and Casualty, seeing as how opposing counsel in the debt-collection case has strong connections to Infinity. This bold lawyer has not responded on that topic either. We will keep you posted.)

As for the "Triple Screw Job," it reminds us of a quote from "The Todd," the sex-crazed surgeon from Scrubs: "This is a threesome," The Todd once said, "and it's not the cool kind."

Speaking of The Todd, we could stand to lighten the mood around here. Here is Todd's version of "The Greatest Conversation Ever," with our hero finding all kinds of meaning in the name "Perry Cox." Enjoy.

Celebrating the Genius of Billy Joel

We've been dealing lately with some grim subjects--suicides, mysterious deaths, pedophilia, and the like--so we thought it was time for a musical interlude. What better place to turn than the music of Billy Joel, who we consider one of America's finest pop composers.

Joel entered our thoughts in a roundabout way recently. Having both been cheated out of our jobs, Mrs. Schnauzer and I can't afford to enjoy many special occasions. But we did treat ourselves to a movie one recent afternoon. (An insight: One of the advantages of unemployment is that you can go to a midweek matinee and be assured that the theater will be almost empty. Trust me, it's great. Now, if we could only figure out a way to sneak in without having to pay.)

We thoroughly enjoyed "The Kids Are All Right," a splendid little film about a lesbian couple (played by Annette Bening and Julianne Moore), who see their family unit turned upside down when their children track down the sperm donor (Mark Ruffalo) who is their biological father. "The Kids Are All Right" probably isn't in theaters anymore and should be out soon--if it isn't already--on DVD. We give it four thumbs up.

One of the movie's key scenes comes when the family visits the sperm donor's home for dinner. Bening's character is amazed to discover that a "manly guy" like Ruffalo is into Joni Mitchell. She loves Mitchell so much that she named her daughter after her. After a few glasses of wine, they begin to rhapsodize about Mitchell's brilliance and agree that Blue is her finest work.

The scene is beautifully written and acted, serving as the film's centerpiece--wrapping up what came before and setting the stage for what comes next. On the way home, we started talking about Joni Mitchell. I had to admit that I've never been that big a Joni Mitchell fan--and I probably fall well short of Ruffalo's "manly guy" status, too. Mrs. Schnauzer piped up, "You know, I think I've got a Joni Mitchell album, but I can't remember the name of it."

That sent me off, upon our arrival at home, on a search to discover if we, indeed, are the proud owners of a Joni Mitchell album. And I'll be darned if the answer isn't yes. Somewhere along the way, Mrs. Schnauzer acquired the Court and Spark album, a 1974 release that includes "Help Me" and "Free Man in Paris," two of the few Mitchell songs with which I actually am familiar. The only two others probably are "You Turn Me On I'm a Radio," and "Big Yellow Taxi."

I hate to admit being so ignorant about Joni Mitchell, but that is the shameful truth. Mitchell, for me, is one of those artists I admire, without truly being a fan. And I don't know why. I love Linda Ronstadt, Carole King, Stevie Nicks, and numerous other female artists. Maybe Joni Mitchell is just too deep for my "every man's" taste. I'm the same way about Bob Dylan. I know that Dylan, like Mitchell, is an important and hugely influential figure in music. But to buy his records and actually listen to his music . . . no, thanks.

Anyway, I proceeded to prove just how clueless I am about Joni Mitchell. My intent was to play her album--if I discovered that we actually owned it. But while holding Court and Spark, I caught a glimpse of my treasured copy of Billy Joel's The Stranger. I wound up playing that instead and still haven't listened to the Joni Mitchell album.

Most folks are familiar with Billy Joel's numerous hits--"Piano Man," "Just the Way You Are," "Uptown Girl," "Allentown," "It's Still Rock 'n Roll to Me," "We Didn't Start the Fire," and many more. But to me, the measure of an artist's greatness lies with the songs that weren't released as singles--the ones that reveal the depth of a musician's catalog.

By that measure, Billy Joel has produced an astonishing body of work. In fact, I would gladly pay major dollars (if I had them) to attend a Billy Joel concert where he did not play any of his hits. The depth of Joel's work is so strong that he produced an album called Songs in the Attic, which is live versions of largely unknown songs from his earliest records.

One of those songs is "Captain Jack," a gritty tune about a real person, a drug dealer who lived near Joel in Oyster Bay, New York. Joel has said in interviews that he considers "Captain Jack" to be an anti-drug song. It has long been one of his concert staples, and this is from a 2008 concert at Shea Stadium:

The Stranger is the album that vaulted Joel to superstar status. The title song never was released as a single, but it is the album's centerpiece and one of Joel's finest compositions:

Finally, we have Billy Joel's magnum opus, the masterful "Scenes From An Italian Restaurant," from The Stranger. Pop/rock music does not get any better than this. Enjoy:

Wednesday, September 29, 2010

The Strange Tale of a Pedophile in the U.S. Justice Department

Roy Atchison

The U.S. Department of Justice generated plenty of strange stories during the George W. Bush years. But one of the strangest involved John David "Roy" Atchison, an assistant U.S. attorney in Pensacola, Florida, who committed suicide after being caught in a pedophilia sting in Detroit.

Atchison's sad story has many connections to Birmingham and Alabama. And it raises this question: How did a guy with a shaky work record and a history of run-ins with the law get hired by the world's supposedly foremost crime-fighting organization? Did Atchison attain his lofty position because he had connections to powerful figures in the Alabama legal world?

Investigative journalist Margie Burns examines these questions, and much more, in a series of posts about the Atchison case at her blog,

Burns begins with the actions that turned Atchison into a national figure in fall 2007:

This is not the story of a man who engaged in pedophilia for years or decades before being caught. It is the story of a man whipsawed by the strain of living up to a high-achieving family rooted in Birmingham, Ala., whose high-functioning connections assisted him for years in developing a career for which he turned out not to be suited. On Sept. 16, 2007, Assistant U.S. Attorney John David Roy Atchison, serving as a federal prosecutor in the Northern District of Florida, was arrested on credible charges of basically pedophilia. Atchison committed suicide in federal prison Oct. 5.

A dead pedophile might not sound like a tragedy. But Atchison was thought to be participating in a pedophile ring, and his death removed a useful informant from law enforcement resources. The question of how he was enabled to kill himself rather than being preserved for justice is one of the loose ends left hanging in his case.

Burns shows that Atchison's colleagues in the Northern District of Florida apparently were clueless about his suspicious behavior in the workplace:

When Atchison was arrested, his personal laptops—two, one being used by his wife—were confiscated, along with his workplace desktop and removable flash drives. Setting aside the criminal acts under investigation, this is multiple computer drives to keep an eye on, just with a view to general security and privacy, and carrying laptops to and from the office is potentially a security breach. . . .

The obvious question here is whether AUSAs are allowed to have personal ‘business on the side,’ conducted from the office. Officially federal policy prohibits moonlighting while on the job, for any federal employee and particularly for federal prosecutors.

Perhaps Atchison thought he good get away with questionable behavior because of his family connections. It appears, based on Burns' reporting, that such connections helped him move up in the legal world, even though he was adrift during his 20s and early 30s. He bounced from job to job and moved 18 times in one 14-year period. That doesn't sound like the attributes of a high achiever. But Atchison had one advantage: connections to the powerful Birmingham law firm of Starnes and Atchison. In fact, he worked at the firm as a law clerk for several years in the late 1970s and early '80s:

At that time, he was enrolled at Samford University’s Cumberland School of Law in Birmingham, Ala., returning to the place where his family had roots. During the same year--the exact dates are inconsistently given--he also worked as a clerk at the Birmingham law firm of Starnes and Atchison, co-founded by a cousin, W. Michael Atchison. Well-regarded local attorney Mike Atchison moved to another firm in 2010, and Starnes and Atchison changed its name; see later post. Repeated attempts to contact Michael Atchison have been unsuccessful.

Michael Atchison now works at Burr Forman, one of Birmingham's large downtown firms, and he apparently is not anxious to discuss his late cousin. Is that because members of the Birmingham legal community once helped Roy Atchison get out of some jams? The answer appears to be yes. Through the Freedom of Information Act, Burns has studied FBI documents related to the Atchison case, and she writes:

The tacit question in these records remains how Atchison got government jobs in the first place. Part of the development is clear—law school to a government agency to a more desirable federal job, then the lateral move from one federal jurisdiction to another. Questions about who provided references, who co-signed notes, etc., are not answered. Beyond that, attorney Maurice R. Mitts of Mitts Milavec replies matter-of-factly, “It’s not that hard” to get a job in the Justice Department. If you “have a good work ethic and keep your grades up,” Mitts says, “it’s really not that hard.”

It's especially not that hard when you seemingly have members of the Alabama legal community helping to cover up your legal problems. Atchison, it turns out, had an arrest for reckless driving and drug possession. That's the kind of thing that might put a halt to a federal law-enforcement career for many people. But it did not stop Roy Atchison:

On May 1, 1982, just a few weeks shy of getting the J.D., Roy Atchison was picked up by Birmingham police. Obviously any brush with the law is a potential concern in a background check, but the brief account transmitted by the FBI is innocuous enough:

“Arrest check at Tuscaloosa, Alabama, revealed a violation for improper license plates and running a stop sign. Both charges were dismissed. Arrest check at Birmingham, revealed an arrest for reckless driving and violation of Alabama Uniform Controlled Substances Act. The charge of reckless driving was [amended] to running a red light. Applicant failed to appear on this charge and a writ was issued for his arrest. Applicant later appeared and paid a fine. The violation of Alabama Uniform Controlled Substances Act was dismissed by the Assistant District Attorney.”

Atchison essentially blew off the incident on his application for an assistant U.S. attorney position. But Burns reveals how he was able to get off lightly for a crime that might have been a serious matter for someone who was not well connected:

An Assistant District Attorney charged Atchison in the matter—he subsequently failed to appear in court, earning a contempt citation on top of the reckless driving and narcotics possession charges, and a writ was issued for his (re-)arrest. However, a second ADA, Don Russell, dropped charges and dismissed the case: “Subject had no prior arrests, or any evidence that he was selling narcotics.” (Atchison’s two previous traffic citations—one for running a stop sign, another for expired tags—in Tuscaloosa, had also been dismissed.) Generally speaking, possession of more than one bag of controlled substances might be taken as evidence of selling, but it might be noted that ADA Russell got his J.D. at Cumberland Law School, a year after his fellow alum, the highly-regarded Mike Atchison. It might also be noted that Roy Atchison was not only a soon-to-be law graduate and affiliated with an established law firm in town, but was not guilty of driving while black.

This story hits close to home for your humble blogger. I have seen firsthand how powerful law firms such as Starnes and Atchison (now Starnes Davis and Florie) use their influence to help pervert our justice system and cheat regular citizens. In fact, Margie Burns referenced my experiences with the Starnes firm in her reporting:

A check into the records by Birmingham law blogger Roger Shuler also does not turn up any mention of legal assistance for Atchison. Shuler notes, “I’m quite familiar with Starnes and  Atchison. They are a major defense firm here, particularly in defending medical malpractice and legal malpractice cases. In fact, I filed a legal malpractice case one time against a local lawyer, and Starnes and Atchison represented him. The firm, I believe, has defended the University of Alabama in a number of matters. Also, one of their primary partners, Stancil Starnes, became the head of ProAssurance, a Bham-based company that provides malpractice insurance for doctors . . . My impression is that anyone with ties to Starnes and Atchison indeed is well connected” in Birmingham.

Did the Starnes firm and other individuals in the Birmingham legal community help advance the career of a man who turned out to be a pedophile? Were taxpayers, through their support of Alabama's court system,  forced to help fund this whole charade? Margie Burns paints a compelling picture that indicates the answer is yes. And her reporting is ongoing.

Tuesday, September 28, 2010

Is Karl Rove's Lawyer Trying to "Spin" a D.C. Suicide?

Robert Luskin and Karl Rove

One of the federal prosecutors who was under investigation for the botched Ted Stevens case in Alaska apparently committed suicide over the weekend.

Multiple press outlets reported yesterday that Nicholas A. Marsh killed himself. How do we know that Marsh, 37, took his own life? Karl Rove's lawyer said so.

News of Marsh's suicide has spread around the country based solely on the word of Robert Luskin, a high-powered, Washington, D.C., lawyer. Luskin, of the firm Patton Boggs, represented Marsh in the Stevens investigation. He also has represented Karl Rove and helped ensure that the former Bush White House strategist would not have to testify under oath about his role in possible political prosecutions of well-known Democrats, such as Don Siegelman in Alabama and Paul Minor in Mississippi.

The Marsh death appears to be a legal story, a political story, and a personal tragedy. But it's also a story of ghastly journalism.

NPR apparently broke the news of Marsh's death with a report yesterday morning. Several Web sites, including TPM Muckraker and, quickly followed up. The Washington Post had a piece on one of its blogs, and Associated Press spread the news around the country.

As the story developed, almost no reporter seemed to ask this obvious question: How do we know that Nicholas Marsh committed suicide? Unless Robert Luskin moonlights as a coroner, he certainly is not qualified to make that determination. So why are we taking his word for it?

We have to give credit to the Wall Street Journal for at least pondering such questions before going with the story. The WSJ report included the following:

Robert Luskin, Mr. Marsh's lawyer, said the 37-year-old attorney's wife informed him Sunday of the death. Mr. Luskin said he didn't have details of how it occurred. The Metropolitan Police Department in Washington said it didn't have any information about the death. The District of Columbia medical examiner didn't respond to a call seeking comment.

A prominent individual died under apparently unnatural circumstances, but the D.C. Police Department was not called and has no information about the case? That is peculiar.

It's difficult at this point to determine exactly how the story evolved. But it appears Luskin's office issued a statement, and he responded briefly to an e-mail query from WSJ's Evan Perez appears to be the only reporter who questioned Luskin directly and at least tried to check with official sources about the circumstances surrounding Marsh's death.

I've been a professional journalist for 30-plus years, and my experience has been that on any death that appears to be from unnatural causes, law enforcement conducts an investigation and a medical examiner issues a finding. Only then is the cause and/or manner of death reported. After all, it's impossible to accurately report the story without information from sources who are qualified to make such determinations.

The press, with Robert Luskin's help, seemed more than willing to short-circuit that process in the death of Nicholas A. Marsh. Unless Luskin saw Marsh kill himself, he certainly is not qualified to comment on the manner of death.

Our point is not to question whether Marsh actually killed himself. But Luskin, for some reason, appeared to be trying to get ahead of the story yesterday. The press, on a day when it hardly distinguished itself, ignored some journalism basics in helping him do it.

Did Letter Critical of U.S. Chamber Spark an Alabama "Suicide"?

Kevin Zeese

A progressive advocacy group received a letter in early August that outlined charges of fraud and other misconduct against the U.S. Chamber of Commerce and its leader, Tom Donohue. The letter was forwarded to the FBI and the U.S. Department of Justice for investigation, and a little more than one month later, an Alabama business advocate was dead of an apparent self-inflicted gunshot wound.

Was the recent death of Ralph Stacy, senior vice president at the Business Council of Alabama (BCA), connected to the whistleblower letter about Tom Donohue? Did Ralph Stacy write the letter? Did someone think Stacy had written the letter and decided he must face serious consequences?

Kevin Zeese, an attorney for Velvet Revolution, wrote about the whistleblower letter in an article last week at OpEd News. The article is titled "Can Anyone Stop Rove's Crime Against Democracy While It Is In Progress?" The piece focuses on GOP strategist Karl Rove and his efforts to misuse tax laws to help Republicans take back Congress through organizations such as American Crossroads.

Zeese notes that a watchdog campaign, Protect Our Elections, already has put up $100,000 for information leading to the arrests and convictions of Rove and Donohue. Then, Zeese writes:

On August 4, 2010, we received a letter from a purported Chamber of Commerce insider who compares Tom Donohue to Jack Abramoff, Michael Scanlon and Bernie Maddoff, alleges fraud, campaign finance violations and financial impropriety. In a letter on behalf of our coalition I urged the FBI and DOJ to conduct an investigation of Tom Donohue and the Chamber based on this letter.

Zeese did not waste any time in alerting law-enforcement officials about the contents of the letter. You can check out his letter at the link below:

Re: Chamber of Commerce Whistleblower Letter

We do not know the whistleblower's identity at this point. But Stacy certainly would qualify as a Chamber of Commerce insider. We wrote recently about his roundabout ties to the chamber:

Ralph Stacy was a senior vice president at the Business Council of Alabama (BCA), and his death apparently took place at BCA headquarters. But Stacy also was president and CEO of the Chamber of Commerce Association of Alabama (CCAA), whose membership dwarfs that of the more nationally connected BCA.

The two organizations formed an alliance called The Partnership in 2003, not long after Republican Governor Bob Riley took office. But a source tells Legal Schnauzer that, with Riley stained by scandal and his term coming to an end in January, ties between the two groups were splintering.

Why did Stacy have clout with the chamber? Because Donohue and BCA head Bill Canary have a long-standing alliance, which also involves Karl Rove, dating back to their days with the American Trucking Association. Perhaps more importantly, Ralph Stacy was a popular guy among small-business owners across Alabama and he had strength in numbers:

Why would Canary even care about Stacy and his many small-town constituents? Well, Stacy's organization has almost 60,000 members, while Canary's BCA has only about 5,000 members. That discrepancy, our source says, had long gnawed at Canary, Donohue, and Rove, who has deep roots in Alabama from his successful efforts in the 1990s to turn Alabama appellate courts over to Republican control.

Canary's desire to gain control over CCAA's members, and their fees, led to formation of the Partnership in 2003. But it took awhile for the alliance to fully take hold. It was not until December 2009 that the two groups held their first joint annual meeting, featuring Tom Donohue as featured speaker.

As we reported recently, Stacy appeared to be excited about The Partnership and even moved into BCA headquarters in January 2010. Here are his words from a CCAA press release:

“The Partnership, a formal working relationship between the CCAA and BCA, has accomplished many great things in its short history, and recruiting a speaker of Tom Donohue’s stature to our Annual Meeting is one of them,” CCAA President and CEO Ralph Stacy said. “Our national economy is evolving, the direction of our country is in question and Washington is locked battle over our health care system. The U.S. Chamber and its leader are at the epicenter of each of these debates, and all of us are looking forward to his take on the events at hand.”

After moving into BCA headquarters, did Ralph Stacy come across information that soured his attitude about The Partnership and its ties to the U.S. Chamber? Did that insider's knowledge help lead to Stacy's mysterious death?

It's too soon to answer those questions. But this much is certain: Both law enforcement and the mainstream press in Alabama seem to be doing their best to make sure Stacy's death remains a mystery.

Stacy died on September 14, and other than a bare-bones, sketchy report the next day, the Montgomery Advertiser has written nothing about the case. Police officials have declined to provide details. And a source with connections to the Alabama medical-examiner's community tells Legal Schnauzer that officials are being extraordinarily tight-lipped about the Stacy case.

Much of Stacy's professional life was spent in Greenville, and that town's weekly newspaper ran an editorial about his death. Other than that, the Alabama press has been eerily silent--even though Stacy led an organization with some 60,000 members, and he reportedly had friends from one end of the state to the other.

The U.S. Chamber and its affiliates have spent millions of dollars in an effort to influence elections over the past 15 to 20 years. In the wake of Ralph Stacy's death, citizens should be demanding answers to serious questions about the individuals who lead the chamber.

Is the U.S. Chamber so corrupt that someone actually could die because he dared to raise questions about the organization?

As the days pass with utter silence from the Alabama press and law enforcement, that question resonates more and more.

Monday, September 27, 2010

DOJ Lawyer With a Rove Connection Commits Suicide

Nicholas Marsh

One of six federal lawyers involved in the botched prosecution of former U.S. Senator Ted Stevens (R-AK) has committed suicide.

Nicholas A. Marsh and other federal prosecutors in the Stevens case were under investigation for possible criminal misconduct. A report by a special prosecutor in the case is expected in a few weeks.

Marsh's death was announced by a spokesperson for his lawyer, Robert Luskin of Washington, D.C. Luskin represented former White House strategist Karl Rove during inquiries about Rove's role in possible political prosecutions during the George W. Bush administration.

Two of the best known such prosecutions took place in the Deep South--the Don Siegelman case in Alabama and the Paul Minor case in Mississippi. Our research indicates that Marsh did not take part in either the Siegelman or Minor cases. But he was part of the U.S. Public Integrity Section, which was heavily involved in both cases.

Reporting on Marsh's death has been curious, to say the least. He apparently died over the weekend, but the story broke today. NPR, TPM Muckraker, The Washington Post, and all are calling it a suicide. But we have yet to see a quote from anyone in law enforcement, anyone with a background as a medical examiner, confirm that Marsh killed himself.

Where is the suicide angle coming from? Why, from the office of Robert Luskin, who happens to be Karl Rove's lawyer.

For those who consider Karl Rove one of the most evil humans on the planet, Marsh's death poses numerous intriguing questions. Is it possible that Marsh, in preparing his own defense, revealed damaging information about Rove to Luskin? Is it possible that Luskin passed that word along to Rove? Is it possible that such an information trail contributed to Marsh's unfortunate demise?

USA Today Investigation Scratches the Surface of Decay in U.S. Justice System

Eric Holder
USA Today has launched a series of investigative reports that show prosecutorial misconduct is a serious problem in the U.S. Justice Department. Last week's first installment indicates the series will be a stellar piece of journalism, one that Harper's Scott Horton says should put the newspaper in Pulitzer territory.

The report, however, only begins to uncover the misconduct that is rampant in America's justice system. For example, USA Today will focus only on federal prosecutors. But what about federal judges? Anyone who has followed the Don Siegelman case in Alabama and the Paul Minor case in Mississippi knows unethical judges are a significant problem. What about state courts, which is where our personal legal nightmare began? And what about appellate courts at both the federal and state levels? We have shown at Legal Schnauzer that appellate judges can be every bit as corrupt as their trial-court brethren. (See herehere, and here.)

In fact, we recently have discovered three examples of unlawful rulings by federal judges here in Alabama. One involves a lawsuit Mrs. Schnauzer and I filed against unethical debt collectors, and the trial judge made unlawful rulings on at least 10 different issues. How does a judge screw things up that badly? Is he even trying to dispense justice?

Two other cases involve RICO lawsuits against judges and lawyers who allegedly have conspired to fix domestic-relations cases in Jefferson County, Alabama. In both divorce-related cases, the rulings are so blatantly unlawful that they can only be explained, in our view, by incompetence, corruption--or both. We will be reporting extensively on all three cases.

Our research will show, we think, that these federal judges are intentionally cheating litigants in order to protect certain members of the legal and business communities. That's not how our justice system is supposed to work. But all to often, that is exactly how it does work in the real world.

We certainly applaud USA Today's efforts to expose problems with federal prosecutors. But readers should know that is only one component of a justice system that is rotting right under our noses.

How bad is the situation with federal prosecutors? Reporters Brad Heath and Kevin McCoy write:

Federal prosecutors are supposed to seek justice, not merely score convictions. But a USA TODAY investigation found that prosecutors repeatedly have violated that duty in courtrooms across the nation. The abuses have put innocent people in prison, set guilty people free and cost taxpayers millions of dollars in legal fees and sanctions.

Judges have warned for decades that misconduct by prosecutors threatens the Constitution's promise of a fair trial. Congress in 1997 enacted a law aimed at ending such abuses.

Yet USA TODAY documented 201 criminal cases in the years that followed in which judges determined that Justice Department prosecutors — the nation's most elite and powerful law enforcement officials — themselves violated laws or ethics rules.

What form does the abuse take? USA Today reports:

In case after case during that time, judges blasted prosecutors for "flagrant" or "outrageous" misconduct. They caught some prosecutors hiding evidence, found others lying to judges and juries, and said others had broken plea bargains.

Such abuses, intentional or not, doubtless infect no more than a small fraction of the tens of thousands of criminal cases filed in the nation's federal courts each year. But the transgressions USA TODAY identified were so serious that, in each case, judges threw out charges, overturned convictions or rebuked prosecutors for misconduct. And each has the potential to tarnish the reputation of the prosecutors who do their jobs honorably.

What's wrong with the system? Bennett Gershman, law professor at Pace University, sums it up: "There is no accountability." A federal public defender in New York says USA Today's findings are "the tip of the iceberg."

What was the Obama administration's response? Attorney General Eric Holder refused to be interviewed for the story. The White House apparently thinks mouthing platitudes will solve the problem. Reports USA Today:

Attorney General Eric Holder declined to be interviewed; earlier this year, he told judges that officials "must take seriously each and every lapse, no matter the cause." The head of the department's criminal division, Lanny Breuer, said, "Obviously, even one example of real misconduct is too many. . . . If you've engaged in misconduct, the response of the department has to be swift and strong."

How have Holder and Breuer reacted to obvious misconduct during the George W. Bush years. By "looking forward, not backwards" and doing absolutely nothing about it.

At least one person--former U.S. Attorney General Dick Thornburgh--gets it. He says: “No civilized society should countenance such conduct or systems that failed to prevent it.”

The Obama administration, however, has tolerated it. And that, Scott Horton writes, is to the president's eternal shame. Events in Alabama are at the heart of Horton's critique:

What does Thornburgh mean by “systems that failed?” The focus of his ire is plainly a culture within the Justice Department that promotes abuse and fails to deal with abuse when it is publicly exposed. Despite his promises to clean the situation up, Eric Holder has done nothing other than arrange some ethics training courses. The Department steadily resists disciplinary action against prosecutors who misbehave and attempts to block public exposure of their misconduct through congressional probes with claims of prosecutorial immunity. Holder refuses even to take questions on the subject at public events (as occurred just [last] week at an event marking the fiftieth anniversary of To Kill a Mockingbird in Alabama). The U.S. attorney who is perhaps the worst single Bush-era offender remains in her position as Republican senators block efforts to appoint a replacement, and the Justice Department continues to stonewall an investigation into some of the most serious cases of abuse.

Thursday, September 23, 2010

Meet One Alabama Democrat Who Still Has a Pair

Paul Hubbert

Alabama's master politician has shown that at least one Democrat in the U.S. still has a spine. And in the process, he showed that Republican hypocrisy has reached a new zenith.

That's quite a feat. But Paul Hubbert, executive secretary of the Alabama Education Association (AEA), pulled it off. And Democrats around the country, including the one who resides at 1600 Pennsylvania Avenue, should watch and learn.

Bradley Byrne, Governor Bob Riley's hand-picked successor, has been conducting a whinefest ever since he got thrashed in the Republican primary by the relatively unknown Robert Bentley. Now we know, at least partly, why Byrne got trounced. Paul Hubbert took him to the proverbial woodshed.

Byrne had run on a platform of attacking "union bosses," a thinly veiled reference to Hubbert and the AEA. Did Hubbert choose to tuck tail and "look forward, not backwards"? Not exactly. He fought back--big time.

Associated Press reports that newly released records show AEA provided every dollar of a $711,020 media blitz that targeted Byrne in the Republican runoff. Reports AP:

Before the July runoff, a new and secretive organization called the Conservative Coalition for Alabama ran an extensive ad campaign that criticized Byrne's record in state government. Little was known about the group other than it listed its official address as a rented mail box at a package shipping store in Montgomery.

But a newly released report reviewed by The Associated Press shows its only donor was AEA, which provided $750,000 on June 23. That was one day after the coalition was created.  
The coalition, in a quarterly filing with the Internal Revenue Service, said it spent $711,020 — all with the Smart Media Group that placed the anti-Byrne ads.

AEA has said it will remain neutral in the November general election between Bentley and Democrat Ron Sparks. But the organization made no secret of its distaste for Byrne:

AEA favored state Rep. Robert Bentley of Tuscaloosa, who won the Republican runoff July 13 with 56 percent of the vote. Byrne, a former state school board member, state senator and two-year college chancellor, had targeted AEA in his campaign and accused the teachers' organization of being a corrupting influence on state government.

Has Bradley Byrne gotten over the spanking he received from Paul Hubbert and gone on to other things? Nope, he's still whining about it--even though there is no indication that AEA did anything unlawful or unethical. Reports AP:

Byrne, of Montrose on the Eastern Shore of Mobile Bay, said today that it's sad that people can run attack ads against a candidate but not disclose who's behind the ads until after the election.

"It undermines democracy and it undermines the ability of people to make informed decisions," he said.

Oh, really? Did Byrne whine when Republicans used such tactics to take over Alabama's appellate courts? Not on your life. Reports AP:

It's a practice that has been used in Alabama campaigns before by business groups in judicial races, but it's the first time AEA has used it, AEA Executive Secretary Paul Hubbert said Tuesday.

Most groups running ads in Alabama campaigns register with the secretary of state and report their donors before the election. Those groups are running ads advocating a vote for or against a candidate at a specific election.

Instead of doing that, the Conservative Coalition for Alabama registered with the IRS on June 22 as a "527 organization." Those are tax-exemption political organizations that run informational ads criticizing or praising a candidate's record. But their ads stop short of recommending how someone should vote, and they don't mention the date of an upcoming election.

"It's public information kind of advertising," Hubbert said.

Yep, and thanks to that public information, Republican voters told Bradley Byrne to take a hike.

Byrne's hypocrisy, however does not end there. Consider that his mentor, Gov. Riley, was the beneficiary of $13 million in Mississippi Choctaw gaming money during the 2002 election. That comes straight from a U.S. Senate report, from a committee chaired by Republican John McCain. Has Riley ever come clean about the source of those funds, which reportedly were laundered through confessed felon Jack Abramoff? No.

Has Bradley Byrne ever voiced concern about how those shadowy funds "undermine democracy"? No.

And what about Associated Press, and it's blatant hypocrisy? It is digging into perfectly lawful actions by AEA, but has it done any serious investigation of Riley's dirty money from Mississippi. We've seen no sign of it. Has it investigated the millions Byrne received from pro-business groups? We've seen no sign of that either.

So our hat is off to Paul Hubbert. Bradley Byrne, the quintessential arrogant, pampered, white-bread, pro-business Republican, threatened him and his organization. And Hubbert proceeded to administer a colossal beatdown--one from which old Bradley still is squealing like the Ned Beatty character in Deliverance.

Moral of the story? Paul Hubbert beat Republicans at their own game. And it's a wonderful sight to behold.

We would suggest that national Democrats take a page from the Hubbert playbook, before it is too late and Republicans have taken back one or both houses of Congress. We've seen no sign that "No Drama" Obama is listening. But just in case, he can take a lesson from Dr. Perry Cox, one of our favorite characters on Scrubs:

Wednesday, September 22, 2010

Bashinsky Autopsy Report Presents No Scientific Evidence of Suicide

Major Bashinsky
Editor's Note: This post is a joint reporting effort by Lori Alexander Moore of and Roger Shuler of Legal Schnauzer.

The autopsy report in the death of prominent Birmingham attorney Major Bashinsky presents no forensic evidence to support a finding of suicide.

Bashinsky was reported missing on March 3, 2010, and his body was recovered about two weeks later from a golf-course pond on Birmingham's Southside. Law enforcement officials announced on March 24 that Bashinsky's death had been ruled a suicide.

We have obtained a copy of the autopsy report, and it does not point to any scientific evidence in reaching its conclusion about Bashinsky's death. Instead, the two physicians who signed the report state that they based their findings on the investigation of police detectives.

In reading the case summary, it appears the suicide finding is based on the work of officers who are not qualified to determine manner of death. The 14-page report includes plenty of technical information. But based on the words of the two scientists who signed the report, none of that data points conclusively to suicide. That finding is based almost totally on the police investigation. (See the case summary from the autopsy report at the end of this post.)

Major Bashinsky, 63, was the son of one of Alabama's most renowned businessmen. The late Sloan Y. Bashinsky Sr. was the CEO of Golden Enterprises, the makers of Golden Flake potato chips and snack foods. The elder Bashinsky was long known for his association with University of Alabama football and its iconic coach, Paul "Bear" Bryant.

The disappearance and death of Major Bashinsky has been one of the biggest stories in Alabama so far this year. A prime source of information on the case has been, a blog written by Sloan Bashinsky Jr., Major's older brother who also is a lawyer and lives in Key West, Florida. In fact, Sloan Bashinsky Jr. reported that his brother had died from a gunshot wound to the head almost a week before that was announced as the official cause of death.

Manner of death, suicide, has seemed suspect from the time it was announced. Sloan Bashinsky Jr. has written that he accepts the finding and believes his younger brother's bisexuality might have been a factor. But we have written several posts--here and here--that raise questions about the official finding. We also noted the sloppy, "trust me" journalism that has surrounded the case.

The quality of journalism on the story looks even worse now that we have seen the autopsy report. The case summary raises obvious questions about the findings, but no local mainstream reporters seem to have asked them. Did they bother looking at the autopsy report? Did they just not care to question authorities?

Gary T. Simmons, M.D., associate coroner/medical examiner for Jefferson County, and Diane C. Peterson, M.D., UAB pathology fellow, signed the report. The key findings come in the following lengthy paragraph:

The decedent was found in a golf course pond with ligatures as described. However, the ligatures were such that the decedent essentially had complete freedom of movement. As described, the decedent had a contact gunshot wound of his head consistent with causing this wound, car keys, duct tape similar to that used to bind on the decedent, and scissors being found in the ponder generally under the area where the decedent's body was found. Furthermore, the decedent was reportedly witnessed buying duct tape and rope similar to that found on the body at a hardware store with the decedent also being video taped the day he was reported missing in a coffee shop near this hardware store. At that time he was apparently dressed in the same clothes he was found in. The decedent appeared alone in this video. Taking these facts into consideration as well as the findings of the rest of the investigation it is our opinion that this was a self inflicted gunshot wound. It is therefore our opinion that the cause of death is best listed as contact gunshot wound to the head with the manner of death being suicide.

The key points in the 14-page report can be boiled down to the material in bold above--and none of it has to do with scientific findings. It revolves around alleged activities at a coffee shop and a hardware store, information that comes from police investigators.

We are not experts in the jargon of medical examiners, but the language here--"the cause of death is best listed as . . . "--is not terribly convincing. In fact, it appears that the medical examiners were faced with an inconclusive autopsy report, but listed suicide as the manner of death anyway.

An accidental death seems to be ruled out in the Major Bashinsky case--so that would leave only suicide or homicide. We see no conclusive evidence in the autopsy report to indicate Bashinsky was murdered. But we also see no conclusive evidence to indicate he killed himself--certainly none of a scientific variety.

A memorial service was held for Major Bashinsky on March 23, and the press reported the suicide findings the next day. Since then, mainstream reporters seemingly have lost interest in the case. But we have sensed for some time that the general public has many unanswered questions about the case.

Based on the autopsy report, we would say those questions are understandable.

(To be continued)

Bashinsky Autopsy1

Tuesday, September 21, 2010

Was U.S. Chamber a Factor in Mysterious Alabama Suicide?

Tom Donohue

A business leader who apparently committed suicide last week in Montgomery, Alabama, was director of a 60,000-member association that had long been coveted by rivals with ties to the U.S. Chamber of Commerce and former Bush White House strategist Karl Rove.

Ralph Stacy was a senior vice president at the Business Council of Alabama (BCA), and his death apparently took place at BCA headquarters. But Stacy also was president and CEO of the Chamber of Commerce Association of Alabama (CCAA), whose membership dwarfs that of the more nationally connected BCA.

The two organizations formed an alliance called The Partnership in 2003, not long after Republican Governor Bob Riley took office. But a source tells Legal Schnauzer that, with Riley stained by scandal and his term coming to an end in January, ties between the two groups were splintering.

Did those tensions contribute to Ralph Stacy's unexpected death? Was Stacy's death the result of a power struggle between one organization favoring small business and another leaning toward big business? And did Stacy's death, while seemingly an Alabama event, have ties to national figures such as Rove and U.S. Chamber of Commerce Director Tom Donohue?

Stacy has been described in news reports as a close associate of BCA President Bill Canary. But in truth, our source says, the two men had an uneasy relationship--and radically different business philosophies. Stacy became the CCAA's first professional director in 1999, helping to guide more than 120 local chambers around the state, many of them in small towns. Canary, from his days at the American Trucking Association, has ties to big business and national players.

Why would Canary even care about Stacy and his many small-town constituents? Well, Stacy's organization has almost 60,000 members, while Canary's BCA has only about 5,000 members. That discrepancy, our source says, had long gnawed at Canary, Donohue, and Rove, who has deep roots in Alabama from his successful efforts in the 1990s to turn Alabama appellate courts over to Republican control.

Canary's desire to gain control over CCAA's members, and their fees, led to formation of the Partnership in 2003. But it took awhile for the alliance to fully take hold. It was not until December 2009 that the two groups held their first joint annual meeting, featuring Tom Donohue as featured speaker. Here is how the CCAA Web site described the event:

The Chamber of Commerce Association of Alabama and the Business Council of Alabama will make history on Friday, December 4, when they hold their groups’ first joint Annual Meeting in Birmingham featuring a keynote address by Thomas J. Donohue, President and CEO of the United States Chamber of Commerce.

Gov. Bob Riley, who has long been a friend and advocate of Chambers across the state, will also attend this important event beginning at 11:30 a.m. in the Harbert Center located downtown.

At the time, Ralph Stacy appeared to be all for the alliance. The CCAA press release states:

“The Partnership, a formal working relationship between the CCAA and BCA, has accomplished many great things in its short history, and recruiting a speaker of Tom Donohue’s stature to our Annual Meeting is one of them,” CCAA President and CEO Ralph Stacy said. “Our national economy is evolving, the direction of our country is in question and Washington is locked battle over our health care system. The U.S. Chamber and its leader are at the epicenter of each of these debates, and all of us are looking forward to his take on the events at hand.”

Stacy would become a formal member of the BCA staff in January 2010, moving into the organization's headquarters. That is where, based on news reports, he apparently lost his life some nine months later.

Was Ralph Stacy's death what might be called a "standard suicide," driven by feelings of despondency. Our reporting, to this point, indicates the answer probably is no. Could he have been pressured into killing himself, under a threat to someone close to him? Was it perhaps not a suicide at all?

Business leaders, in Alabama and beyond, need to be pondering those questions. And they also need to look seriously at the kinds of people they have entrusted with key leadership positions.

Is it possible that Ralph Stacy, after less than a year at BCA headquarters, realized he had jumped in bed with a bunch of pit vipers? Had Stacy also become knowledgeable about the way BCA and its U.S. Chamber partners really conduct business?

Did Ralph Stacy, an ordained minister seeing ugliness all around him, want out? Was someone determined to make sure that Ralph Stacy, and his insider's knowledge, could not leave?

Here is Mr. Stacy's obituary from the Montgomery Advertiser:

STACY, Mr. Ralph, 53, a resident of Montgomery, AL and a former resident of Greenville, AL, died Tuesday morning, September 14, 2010 in Montgomery, AL. Funeral services are scheduled for Friday, September 17, 2010 at 2 p.m. from the First United Methodist Church of Greenville, AL with Father Fred Lindstrom officiating. Burial will be in Oakwood Cemetery, Georgiana, AL. Dunklin & Daniels Funeral Home directing. The family will receive friends at the First United Methodist Church of Greenville from 1 p.m. until service time. He was preceded in death by his parents Herschel and Wylma Stacy. Mr. Stacy is survived by his wife, Angel Stacy and daughter, Savannah Stacy both of Montgomery, AL and other extended family members and friends. Ralph was Director of the Greenville Area Chamber of Commerce for seven and one/half years and associated with the Greenville Advocate for several years. L. Ralph Stacy was the Senior Vice President for Strategic Communications at the Business Council of Alabama and Executive Director of The Partnership, an organization that links more than 120 local Chambers of Commerce statewide and their nearly 50,000 business members with BCA. He was the founding President and CEO of the Chamber of Commerce Association of Alabama, a position he held for ten years. A sixth generation Alabamian, Stacy was a native of Georgiana. As a teenager, he earned the prestigious distinction of Eagle Scout, the highest award given by the Boy Scouts of America. He was a graduate of Huntingdon College, where he was a member of the collegiate golf team. A well known public speaker, Stacy was the recipient of the "America's Champion of Small Business Award"from the National Coalition of Capital, as well as the Chamber of Commerce Association of Alabama's Jamie Wallace Award for lifetime achievement in 2009. Stacy held the Certified Association Executive professional certification as issued by the American Society of Association Executives. Stacy was a veteran of the print and electronic communications fields, and received two national awards for television and print marketing. He was an author, syndicated columnist and syndicated radio host. He was a member of Class Sixteen of Leadership Alabama, the BCA Board of Directors, the Board of Troy University's Center for International Business and Economic Development, a Governor's appointee to the Alabama Partnership for Children and was President of the Board of Director's of the Alabama Council of Association Executives. He was a founding partner and executive committee member of the Alabama Community of Excellence (ACE) Program. As an ordained minister, he also served as Pastor of the Beatrice Community Church. He was an avid golfer, outdoorsman and reader. In lieu of flowers, the family request donations be made to The Boy Scouts of America. 3067 Carter Hill Rd. Montgomery, AL 36111. For online condolences, please visit: . Dunklin and Daniels Funeral Home in charge of arrangements.

Why Do Feds Nail One Fraudster, While Another Goes Free?

Paul Bryant Jr. and Jeff Sessions
The U.S. Department of Justice has a curious approach to fighting financial crimes. Consider two cases that are based in other states but have strong ties to Alabama.

In the first case, which came to light in June, federal authorities arrested Lee Bentley Farkas, of Ocala, Florida, for a series of schemes that led to the collapse of Montgomery-based Colonial Bank. Assuming Farkas actually committed a crime, that is good news. The Farkas trial is set to begin on February 22, 2011, in Alexandria, Virginia.

The second case goes back to 1997--and in that one, there is little doubt a crime was committed. A federal jury convicted a Philadelphia lawyer and entrepreneur named Allen W. Stewart on 135 fraud-related counts. A significant chunk of those counts involved a scheme that Stewart concocted with Alabama Reassurance, a company that was owned by prominent Tuscaloosa bussinessman Paul Bryant Jr.

But did the federal government go after Alabama Re the way it is going after Lee Farkas and his now-defunct mortgage company, Taylor Bean and Whitaker? Nope. In fact, Paul Bryant Jr., son of the late Hall of Fame football coach Paul "Bear" Bryant and a member of the University of Alabama Board of Trustees, quietly liquidated Alabama Re roughly two years ago.

In other words, a company that had admitted assets of more than $238 million--and had been implicated in a $15 million fraud scheme in Pennsylvania--essentially went away. And apparently not a word was written about it in the mainstream press.

Meanwhile, the Lee Bentley Farkas story is all over the news, with The Washington Post turning out a major piece on it.

To be sure, Farkas appears to have been involved in some serious hanky panky. Reports the Post:

Earlier this week, federal authorities arrested Farkas, 57, accusing him of covering up losses at his firm and creating fictitious mortgage assets, among other scams. He also is accused of trying to defraud the Treasury Department of $553 million from its rescue fund for banks. Farkas, through his attorney, has denied wrongdoing.

The FHA and Ginnie Mae could potentially get hit with more than $3 billion in losses, said Kenneth Donohue, the Department of Housing and Urban Development's inspector general. FHA and Ginnie Mae halted business with Taylor Bean in early August. The company shut down one day later.

Those are serious dollars, and that involves the criminal side of the case. There is a civil side, as well:

The Securities and Exchange Commission launched a civil case this week against Taylor Bean. It is seeking the return of ill-gotten gains and penalties plus interest from Farkas and his company, though the court handling the case has not yet set dollar amounts. The court also will decide whether that money will go to Treasury or a fund that repays investors harmed by such scams.

We applaud the feds for investigating and prosecuting what appears to be a shameful case of financial fraud--one that started in Florida and reached deep into Alabama.

But what about that other case, the one that started in Pennsylvania and reached deep into Alabama, in the direction of Tuscaloosa? Certainly the $15-million scheme between Allen W. Stewart and Alabama Re pales in comparison to the numbers, in the billions, being thrown around in the Farkas-Colonial Bank case.

But $15 million is not financial chopped liver. And the case had serious fallout, leaving thousands of Americans with worthless life-insurance policies.

Also, who knows how many other schemes Alabama Re might have been involved in. Sources tell Legal Schnauzer that federal investigators had been told that, once a conviction was gained in the Stewart case, they were free to go after Alabama Re.

Someone in the chain of command, however, called off the Alabama Re investigation. And that was done even though a federal jury in Pennsylvania had found the company was involved in financial fraud connected to Allen W. Stewart.

It's almost as if Paul Bryant Jr., due to his family's fame and influence, had a protector in the Justice Department, someone who made sure no one would scrutinize Alabama Re's activities too closely.

That's the kind of protector Lee Bentley Farkas probably wishes he had about now.

Is that how "justice" in America works? If you have the right connections, you can pull all sorts of shenanigans and never have to be held accountable?

Based on two cases with strong Alabama connections, it sure looks that way.

Monday, September 20, 2010

Suspicious Deaths are Piling Up on the Political Front in Alabama

Ralph Stacy

A senior vice president at the Business Council of Alabama (BCA) died last week from an apparent self-inflicted gunshot wound, marking at least three people with ties to our state's ruling conservatives who have died under unusual circumstances in the past six months.

Ralph Stacy was in charge of strategic communications and was a chief lieutenant to BCA president Bill Canary. Montgomery police have released few details about Stacy's death, except to say they responded last Tuesday to a report of a self-inflicted gunshot wound at BCA headquarters. Stacy's funeral was on Friday.

We have described Alabama as Ground Zero for justice-related sleaze during the George W. Bush administration, and the state's political environment has been toxic for years. Republican Governor Bob Riley has documented ties to the Jack Abramoff scandal. And for about a year, Riley has been leading a crusade against gambling in Alabama, apparently to help protect the market share of his Choctaw gaming supporters in neighboring Mississippi.

A federal investigation is ongoing into gambling-related activities in the Alabama Legislature. And we reported 12 days ago that Leura Canary, U.S. attorney for the Middle District of Alabama, might be planning indictments of 10 or more prominent Democrats as an "October Surprise" designed to have an impact on the November elections. Among Canary's possible targets are Democratic gubernatorial candidate Ron Sparks, a proponent of an education lottery, and gambling magnate Milton McGregor.

Leura Canary, a Bush appointee who still has not been replaced by the Obama administration, is married to Bill Canary, and the couple have been longtime Riley allies. But now one of Bill Canary's closest associates has turned up dead under mysterious circumstances--and he is not the first person with connections to the Riley administration to meet an untimely demise.

As Riley's two terms are winding down, bodies are piling up. Is that coincidence? Or has Alabama's political environment gone from toxic to deadly? And if so, what is driving it?

Ralph Stacy certainly did not seem like a prime suspect to commit suicide. He was 53, with a wife, Angel,  and a daughter, Savannah. Friends and colleagues described him as a jovial man who was a popular speaker and didn't mind poking fun at himself. The Montgomery Advertiser wrote:

Montgomery Mayor Todd Strange said Stacy's personality made him stand out in any group.

"He was just so gregarious and so friendly," Strange said.

Randy George, president of the Montgomery Area Chamber of Commerce, noted Stacy's long commitment to chamber interests. That career also included a stint leading the Greenville Chamber of Commerce.

"He did a magnificent job," George said. "Ralph was one of those people who was truly bigger than life."

Stacy was a hefty man with a large smile who was just as likely to joke about his baldness as any other subject. That made him popular on the speaker circuit.

"He was a really dynamic and entertaining guy," George said.

Stacy had become an advocate for business as a young man in south Alabama. Wrote the Greenville Advocate:

Stacy, a native of Georgiana, was a well-known figure in Alabama through his work with the state’s 120 Chambers of Commerce. He was a popular emcee and guest speaker in Greenville and the surrounding area for events such as the annual Relay for Life and the Achiever Award program. His columns were published in The Greenville Advocate, where he worked as a reporter prior to serving as executive director of the Greenville Chamber.

Is Stacy's death part of a disturbing pattern? It's hard to tell, but we know of at least two (and maybe three) other cases that raise questions:

* Major Bashinsky--The 63-year-old son of one of the state's best-known businessmen was reported missing in early March. About two weeks later, his body was found floating in a golf-course pond on Birmingham's Southside, and his death was ruled a suicide. His father, the late Sloan Bashinsky Sr., was the CEO of Golden Enterprises, the maker of Golden Flake potato chips and snack foods. In the months leading up to Major Bashinsky's disappearance, the Estate of Sloan Bashinsky was involved in a lawsuit with W&H Investments of Birmingham, seeking an accounting of some $37 million the elder Bashinsky had invested with the firm--mostly in oil wells. A settlement was approved in the lawsuit on March 1, two days before Major Bashinsky was reported missing. One of the partners in W&H Investments is William Cobb "Chip" Hazelrig, who once had a campaign contribution to Bob Riley returned when it was discovered that Hazelrig was a founding partner of a company called Paragon Gaming. Both Hazelrig and Rob Riley, the governor's son, had ties to a company called Crimsonica, which is based in Tuscaloosa and run by a man named Robert Sigler.

* Zoa White--A former Riley campaign worker, the 69-year-old White was found dead in her midtown Mobile home on June 28. News reports have said she was beaten to death with a hammer. White had worked in the Alabama Department of Economic and Community Affairs (ADECA) under Bill Johnson, who went from being a member of the Riley administration to one of the governor's harshest critics. Johnson was so close to White and her family that he helped notify friends about funeral arrangements. Mobile police recently made an arrest in White's murder, but they have said little about evidence found in the case. The prosecution will be led by Mobile County District Attorney John Tyson, who is commander of Riley's anti-gambling task force. Suspect Carlos Edward Kennedy has been denied bond in the case and is represented by a court-appointed lawyer.

What about that other possible curious death we mentioned earlier? Suzanne (Pilkerton) Bashinsky-Ash, age 57, died in mid June in Birmingham. She was Major Bashinsky's stepsister and the biological daughter of Joann Bashinsky, who was Sloan Bashinsky Sr.'s second wife and now is director of Golden Enterprises. Associates of Joann Bashinsky were heavily involved in the lawsuit against W&H Investments. The only reporting on Suzanne Bashinsky-Ash's death has been a standard obituary, and we've seen nothing to indicate it was anything other than a natural death. But she was adopted by Sloan Bashinsky Sr., meaning two of his four children died between March and July of this year, within roughly four months of settlement in the W&H Investments lawsuit. The surviving children are Elisabeth Burford Bashinsky and Sloan Bashinsky Jr., a lawyer who lives in Key West, Florida, and has written extensively about Major Bashinsky's disappearance and death at the blog

As for Ralph Stacy, many questions remain about his death--and the Montgomery press corps seems to be in no hurry to answer them. Stacy's body reportedly was found at BCA headquarters. Where exactly was it found--inside the building, in his office, in a restroom, outside in a parking lot or deck? Who discovered the body? Did anyone witness the shooting? Did coworkers hear a gunshot? Does forensic evidence point to suicide? Did family members or friends see any signs that the outgoing Mr. Stacy was suicidal?

Perhaps most curious to us is the fact that Ralph Stacy died at work. It's almost as if someone was trying to send a message by having the death take place at the BCA headquarters. Was it Ralph Stacy--or someone else? And what message were they sending?

Thursday, September 16, 2010

Bob Riley Caves Rather Than Give Testimony Under Oath

What can make an arrogant Republican crumble in fear? The thought of having to testify under oath about his corrupt actions.

That's the lesson to take from reports that Alabama Governor Bob Riley has agreed to settle a lawsuit, in the face of a tight deadline for his deposition. A state judge had refused to dismiss the lawsuit and given both sides until September 20 to complete depositions--and opposing counsel had indicated that Riley would be among those questioned under oath.

Knowing that depositions can be wide ranging--and this one could have covered issues related to campaign finance, no-bid contracts, and other uncomfortable matters--Riley decided it would be a good idea to pay up.

Reports the Associated Press:

Gov. Bob Riley has agreed for the state to pay the legal fees of a law firm that a legislative committee hired to sue the governor over an unbid computer contract, officials said Wednesday.

Tommy Gallion, an attorney who represented the law firm, said the governor agreed to pay the $78,000 sought by Thomas, Means, Gillis and Seay. Riley also agreed to a payment of about $15,000 to Gallion. The Montgomery law firm had originally in February asked the state to pay $26,740 for its work representing the Legislature's Contract Review Committee.

You can always count on a Riley spokesperson to make a cartoonish attempt to explain away the governor's problems, and Jeff Emerson doesn't disappoint this time. Reports AP:

Riley's communications director, Jeff Emerson, confirmed the governor had agreed to settle the case to avoid costly, drawn-out litigation.

The settlement came after Jefferson County Circuit Judge Tom King last month denied a motion by Riley and state Comptroller Thomas White to dismiss the lawsuit. Emerson said King's ruling made it apparent he would eventually order the state to pay the legal fees.

"We believe the judge would not have changed his mind at trial and the state would have been forced to appeal, which would have added to the cost," Emerson said. "Unlike the plaintiffs, we don't want to waste taxpayer money on this political battle against the governor."

Emerson is so full of horse feces, the stuff must be oozing from his eye sockets. The facts indicate that Riley's decision to settle had nothing to do with his concern for taxpayers.

Riley could have given a deposition and still saved the taxpayers money by resolving the case shortly thereafter. In fact, if the governor really wanted to make sure the public knew the truth at no cost, he could have paid the deposition expenses out of his own pocket.

But he chose to settle matters now--before the September 20 deadline--because he did not want to have to give a deposition. Specifically, he did not want to face the possibility of having to testify under oath about the campaign support he received from Mississippi gambling interests--laundered through Jack Abramoff--and the huge gobs of state dollars he has shipped to family members and their associates.

What else can we learn from the lawsuit settlement? It appears that "Big Boss" Bob Riley might be in a weakened state. Is it possible that some folks don't fear the governor anymore?

Consider Jefferson County Circuit Judge Tom King, who was assigned to the Thomas Means case after Montgomery County judges recused themselves. First, would the Montgomery judges have recused themselves from such a case just a year or two ago, when Riley seemed invincible? We doubt it. And what about King, the guy who refused to dismiss the lawsuit and then put Riley under a tight deadline for a deposition? Is he an unusually ethical and fearless judge? It's possible, but we doubt it. If the Thomas Means case had come before him a year or two ago, we suspect King would have let the governor off the hook.

Have conditions changed for perhaps the most corrupt governor in Alabama history? Well, Riley is a lame-duck governor who will leave office in January 2011. His hand-picked successor, Bradley Byrne, got thrashed in the Republican Party primary. And even Riley's trusted friends on the Alabama Supreme Court seem reluctant to help at the moment, given that they are under investigation for possible misconduct connected to gambling-related rulings that went in the governor's favor.

We felt certain that Riley would avoid a deposition in the Thomas Means lawsuit by filing an emergency motion with the Alabama Supreme Court. But Justice Glenn Murdock, a strong Riley ally who has written numerous favorable rulings for the governor, is facing scrutiny for failing to disclose conflicts of interest-- so that easy path might be closed for now.

If Alabama Democrats were smart, they would pounce now and make Riley pay dearly for visiting untold sleaze upon our state over the past eight years. But Alabama Democrats have proven time and again that they are not so sharp. And with the Obama administration seemingly incapable of appointing a real U.S. attorney in Montgomery, the feds aren't likely to do anything about it.

Our guess is that Bob Riley will eventually walk away scot free, and his family members and cronies will continue to hose Alabama citizens for years.

But to watch the governor squirm when faced with having to give a deposition? It was maybe our favorite political moment of 2010--and it was fun while it lasted.

Wednesday, September 15, 2010

Are HR People and In-House Lawyers Completely Worthless?

Being cheated out of your job in the worst economy since the Great Depression does not come with many moments of hilarity.

But my unlawful termination at the University of Alabama at Birmingham (UAB) did come with one slice of comedy. And it raises these questions: Are human resources (HR) departments a total waste of carbon? Can the same be said for in-house lawyers?

My comic moment came on May 29, 2008, when I opened my e-mail and found a missive from Anita Bonasera, UAB's director of employee relations. This was 10 days after I had been "fired," and the e-mail contained a copy of my termination letter as an attachment. Here is the body of the message:

From: Anita L Bonasera
Sent: Monday, May 19, 2008 8:59 AM
To: Dale G Turnbough; Pamela Powell; Kristi Lamont Ellis
Subject: draft letter

I have attached draft for your review. Cheryl, John and Lisa have reviewed and I would appreciate your input. Thanks. /Anita

You will note that it was sent to the original recipients at 8:59 a.m. on May 19. The recipients were Pam Powell (my boss), Dale Turnbough (Powell's superior), and Kristi Lamont Ellis (who held some title--not sure what it was--in Public Relations and Marketing). Later that day, in a meeting with Bonasera and Turnbough, I would receive my very own personal copy of the termination letter, along with notification that my 19 years of service at UAB were over.

Ten days later, Bonasera would forward this e-mail . . . to me. I can only assume she did it by mistake. In addition to giving me a much-needed belly laugh, it provided names of the folks in UAB's chain of command who signed off on my termination.

The e-mail tells us that "Cheryl," "John," and "Lisa" have reviewed the letter. That would be Cheryl E.H. Locke, then director of human resources who since has left for Wake Forest University; John Daniel, director of the UAB Office of Counsel; and Lisa Huggins, a lawyer in the Office of Counsel.

What else does the e-mail tell us? For one, my termination letter was signed by Dale Turnbough. But we learn that she didn't even write it. Based on the e-mail, it appears that Bonasera wrote it and forwarded it to Turnbough for review. Turnbough had almost zero knowledge about my job duties and performance--and Bonasera had even less.

I had never met Bonasera until I was called into a meeting on May 7, 2008, that ended with me being placed on administrative leave. I had thought it strange that I was fired not by my supervisor, but by a third party (Turnbough). Through this e-mail I learned I was fired by roughly a 12,535th party (Bonasera). We had cockroaches in our office that knew more about my job performance than the person who wrote my termination letter.

What else do we learn? UAB's personnel in HR and the Office of Counsel must be the most clueless or spineless (or both) individuals on the planet. They signed off on this termination, even though it raised enough red flags to choke a bullfighter.

To fully appreciate the inanity of the UAB crowd, let's imagine how a competent HR director might have handled this situation. We will call him H.R. Jones, and let's imagine him meeting with Dale Turnbough, the person whose name is on the termination letter. (You can read the termination letter at the end of this post.)

HR: I've checked Mr. Shuler's record, and he's worked here 19 years, with no disciplinary record under university policy. I assume you must have an awfully good reason for wanting to fire him.

DT: Uhhh . . . yeah.

HR: Now, let's take a look at the termination letter you wrote . . .

DT: Uhh, I didn't exactly write it.

HR: Well, who did?

DT: Umm, Anita Bonasera, in Employee Relations.

HR: And how much time did Ms. Bonasera spend observing the incidents raised in this termination letter?

DT: Well . . . probably none.

HR: Are you familiar with the term "hearsay"? Well, it sounds like your letter is hearsay to the nth degree.

DT: Hearsay is such an . . . ugly word.

HR: Let's look closer at the letter you didn't write.


HR: You tell Mr. Shuler that he was placed on administrative leave pending an investigation of "several serious policy violations" stemming from his "misuse of UAB equipment." What specific policies did Mr. Shuler violate?

DT: Well . . . uh . . . can I get back to you on that?

HR: Don't you think it would be a good idea to be specific about these policy violations?

DT: Probably so.

HR: What kind of UAB equipment did Mr. Shuler misuse?

DT: Computer equipment.

HR: So you're saying Mr. Shuler violated the UAB Acceptable Use Policy (AUP)?

DT: Yes . . . well, no . . . to tell you the truth, I've never heard of that policy.

HR: It governs the use of UAB computers, networks, printers, and associated equipment. You want to fire someone over alleged misuse of computers, and you've never heard of the AUP?

DT: We sure do have a lot of policies around here. Kind of hard to keep up with everything.

HR: You say Mr. Shuler spent several hours a day on his computer doing things unrelated to his work, and you say he used the departmental printer to print non-work related documents. Who made the determination that these were non-work activities?

DT: Pam Powell, his supervisor, told me.

HR: Is this the same Pam Powell against whom Mr. Shuler filed a grievance a few weeks ago, claiming she was harassing him due to his age?

DT: Umm . . . yes.

HR: And Mr. Shuler filed that grievance on the same day that he had met with you to complain about age discrimination?

DT: Umm . . . yes.

HR: Are you aware that UAB policy states that an employee is to use the grievance process without fear of reprisal?

DT: It says that?

HR: Yes, it does. And it means we need to be real careful about how we treat an employee who has filed a grievance in human resources.

DT: I'll be darned.

HR: You go on to allege that Mr. Shuler failed to seek authorization for time off and failed to document work time on the billing system.

DT: Oh, yes . . . that was a big problem.

HR: It was? The guy worked here 19 years and didn't know how to fill out a vacation-request form or a time sheet? If it was such a big problem, why did you let it go for so many years?

DT: Uhh . . . can I get back to you on that one, too?

HR: You say Mr. Shuler displayed belligerent and threatening behavior in a counseling session over these issues. How do you know he displayed such behavior?

DT: His supervisor told me.

HR: The same one he's filed a grievance against?

DT: Uhh . . . yes.

HR: Are you familiar with a legal term called "retaliation"?

DT: I think I've heard of it . . . yeah.

HR: It generally refers to employers who receive a genuine complaint from an employee and then turn around and take improper actions against that employee. They "retaliate" against him. It's against the law. It's not a good thing.

DT: Hmmm . . .

HR: Do you see how a reasonable jury could view Pam Powell's actions as retaliation?

DT: Gee . . . retaliation is such an . . . ugly word.

HR: You say Mr. Shuler had been warned in staff meetings not to engage in activities associated with his personal blog at work. How do you know that? Oh wait, I'm guessing Pam Powell told you!

DT: Uhh . . . yeah.

HR: Did you witness those warnings firsthand?

DT: No.

HR: Does the department have any documentation regarding those warnings?

DT: No.

HR: You say you personally instructed Mr. Shuler not to do work with his personal blog during work hours? What made you think he was doing that?

DT: I didn't.

HR: You had no evidence that he was working on his personal blog at work?

DT: No.

HR: Then, why did you warn him about something he wasn't doing in the first place?

DT: Gee . . . you've sort of stumped me with that one.

HR: You know, my life would be so much easier if UAB managers would actually read our policies.

DT: It would?

HR: Yes, and here is why. You've alleged that Mr. Shuler violated the Acceptable Use Policy. And that policy clearly states that we will deal with such offenses using Progressive Discipline. You've heard of that?

DT: It sounds familiar.

HR: Well, here's how it works: Short of serious offenses that merit immediate discharge--stealing, fighting, stuff like that--we use Progressive Discipline. That means if we have reason to believe an employee has violated a UAB policy, we discuss it with them, issue an oral warning, and document that. If the problem continues, we issue a written warning and document that. If that doesn't solve the problem, it could lead to termination. In other words, the level of discipline progresses. That's why we call it Progressive Discipline.

DT: Neat name.

HR: You see, university policy requires us to warn employees about offenses we have reason to believe they have actually committed. Managers are not to issue "prospective warnings" about an offense the employee apparently hasn't even committed. We try to deal in a world of reality, not managerial fantasy.

DT: We do?

HR: Yes. And here's another thing. Your letter says Mr. Shuler's "serious policy violations" warrant "immediate dismissal." But I see no evidence of that. You don't note any specific policy violations, you didn't use Progressive Discipline, you apparently didn't document anything, and you didn't even write this letter.

DT: Would you like to see my soft-shoe routine? It's very good.

HR: In fact, your failure to follow Progressive Discipline and document it, indicates that--according to our own records--Mr. Shuler did not violate any policies at all.

DT: But Pam Powell said . . .

HR: Well, Pam Powell apparently harassed Mr. Shuler severely enough that he filed a formal grievance against her--the only one he had filed here in 19 years. When she then, after the fact, says, "Mr. Shuler did this and Mr. Shuler did that," well, it smells real strongly of retaliation. You remember that ugly word?

DT: Yes.

HR: And it makes Ms. Powell a real poor witness for our side of things.

DT: A witness? We have to worry about witnesses?

HR: Well, here's the thing, Ms. Turnbough. We have policies, such as Progressive Discipline, so that we can treat employees fairly and equally under federal law. If we use Progressive Discipline with one employee and not with another, that leads to something called "discrimination." And discrimination, if it involves an employee in a protected class, can lead to these things called "lawsuits." Do you see what I'm getting at?

DT: Lawsuit is such . . . an ugly word.

HR: I agree with you there. And my life is so much more pleasant without them. That's why I would suggest you give a second thought to firing Mr. Shuler.

DT: Second thought? Heck, I haven't given it a first thought yet! Hah! That's a joke.

HR: Very funny.

Here is the full termination letter: