“I find what Mr. Cypress pleaded to and agreed to in his proffer was uniquely and sadly American. He was cooking the books.”

That was Judge Kathy Williams in sentencing former Seminole leader David Cypress to 18 months in prison.  Cypress had asked for probation and the government was looking for 2 years.  From Jay Weaver's piece:

His sentencing hearing offered a rare peek into the Seminole Tribe and its Las Vegas-style gambling enterprise, featuring the Hard Rock Hotel & Casino in Broward County. The Cypress case also conjured comparisons to the IRS’s current income-tax crackdown on the Miccosukee Tribe in Miami-Dade County and its former chairman Billy Cypress, no relation.
David Cypress’ lawyer tried to convince the judge that the 61-year-old former tribal council member committed the crime because of “cultural” differences between the Broward-based Seminoles and the rest of America. Defense attorney Joel Hirschhorn said Cypress was a “simplistic man” who didn’t grasp he owed personal income taxes as the tribe underwent a “rags-to-riches” transformation, thanks to its gaming bonanza.
Hirschhorn also argued that Cypress, who apologized in a brief statement, was a victim of the U.S. government, which he said showcased his client as the “poster boy for tax compliance on the reservation, perhaps even in all Indian Country.”
But U.S. District Judge Kathleen Williams was not swayed, despite recognizing the “shameful episodes” of the nation’s mistreatment of Native Americans.***The judge also noted that she could find no evidence of any Native American anywhere in the country being convicted of a tax offense.
Cypress’ prison sentence could have been much worse had federal prosecutors been able to prove he “willfully” committed the double-billing scheme for the entire seven-year period. He was only charged with and pleaded guilty to filing a false tax return in 2007, understating his income by $285,000.
Assistant U.S. Attorney Carolyn Bell, who urged the judge to give Cypress a two-year sentence, mocked the defendant’s argument that his cultural background prevented him from grasping U.S. tax laws. “This was a sophisticated individual,” Bell said. “He was a leader of the Seminole nation.”
Under federal law, the Seminole Tribe’s status as a sovereign nation means the entity itself is not subject to taxes. But once the tribe distributes profits from its gambling casino to members, they are individually responsible for reporting and paying taxes on their annual income tax returns, according to the IRS. 

Very interesting stuff about how the gambling profits are distributed:

In court papers, Hirschhorn revealed that the Seminoles’ gaming profits reached $300 million a year by 2001, with monthly dividends paid to each member. The Seminoles have 3,800 members.Under the distribution formula, every Seminole family of four receives dividends of about $30,000 a month.
Cypress, a notorious big spender who built a massive Mediterranean-style mansion with his millions, was paid a salary of $500,000 on top of the monthly dividend. Like other Seminole council leaders, Cypress controlled a discretionary fund that he tapped to dole out money to family and other tribal members.

Meantime, if you want more Apple/Samsung coverage, check out this piece by Conan:

Read more here: http://www.miamiherald.com/2012/08/09/2943279/ex-seminole-leader-sentenced-to.html#storylink=cpy

Youth Unite!

Judge Kathleen Williams issued a temporary injunction this week, addressing a law that prohibited campaign contributions from minors.  From Curt Anderson:

A two-decade-old Florida law limiting the contributions minors may make to state and local political campaigns is an unconstitutional infringement on free speech rights, a federal judge ruled Tuesday.
U.S. District Judge Kathleen Williams issued a temporary injunction blocking enforcement of the law, which capped contributions by Floridians 17 and under to $100 per election in state and local campaigns. Adults 18 and up can contribute $500. The law does not apply to federal campaigns, which have contribution limits of $2,500 per election for all donors regardless of age.
Williams sided with Boca Raton teenager Julie Towbin and the American Civil Liberties Union, which sued on her behalf. Towbin, then 17, decided not to attend a $150-a-ticket fundraising dinner for the Palm Beach County Democratic Executive Committee after she was warned it might violate state law.
Towbin, a former congressional page, said in a statement issued by the ACLU that the decision "means my voice is no longer worth one-fifth of someone else's."
"This isn't just a victory for minors, it's a victory for the First Amendment," she said.
The law was enacted in 1991 because of perceptions that children might be used to make corrupt contributions, attorneys for Florida argued. They cited cases in other states in which adults used children's donations to evade contribution limits, although none of them occurred in Florida.
Williams, in a 36-page opinion, said there was no evidence that state authorities had ever prosecuted any minors for violating contribution limits and scant proof of any ongoing problem. She also brushed aside state arguments that eliminating the cap would benefit wealthier minors and that it was carefully designed not to violate free speech rights.

Read more here: http://www.miamiherald.com/2012/08/07/2937898/judge-voids-fla-limit-on-minors.html#storylink=cpy

Anything is possible.

Except... getting GSA to shape up the Dyer building.  From John Pacenti:
A congressional subcommittee hammered the General Services Administration on Monday for allowing Miami's historic federal courthouse to linger unused for five years. Members even wondered aloud if the scandal-plagued agency should be disbanded.The hearing at the David W. Dyer Federal Building and U.S. Courthouse was held by the House Subcommittee on Economic Develop-ment, Public Buildings and Emergency Management.A GSA administrator told the panel it's not so easy to convert the Dyer building into offices for the U.S. Bankruptcy Court or the federal defender's office, two of the possibilities suggested.The courthouse with the coquina stone facade shares its electrical grid with the C. Clyde Atkins Courthouse next door, there is the persistent mold problem, and tunnels to transport prisoners connect the building to others in the federal complex.John Smith, a public service administrator with the GSA, estimated the cost of bringing the building up to speed for tenants, federal or private, would be about $10 million.The panel was not sympathetic."Can we actually abolish the agency and have a private agency pick up the ball and run with it?" subcommittee chair Jeffrey Denham, R-California, asked rhetorically.
More from Curt Anderson at Huffington Post:
Opened in 1933, the 166,577-square-foot Dyer building is on the National Register of Historic Places. But it has been deteriorating for years and has an extensive mold problem in South Florida's hot and humid climate. Still, maintaining the vacant structure costs taxpayers about $1.2 million a year, Mica said.
...
Last week, just as the hearing was announced, GSA said it filed a "Request for Information" asking Miami developers and the business community for suggestions on what to do with the Dyer building.
"It seems the GSA only takes action when we hold hearings," Denham said.

And from Jay Weaver:
Their colleague, Mario Diaz-Balart, R-Miami, who sits on the House Appropriations Committee, compared the Dyer Courthouse to the famous Biltmore Hotel in Coral Gables, saying repeatedly he was “speechless” that GSA officials had done nothing to breathe life back into it.
“Frankly, there’s no excuse for it,” Diaz-Balart said.
In chorus, the lawmakers said there are some 14,000 federal properties like the Dyer Courthouse that are empty or not fully used. As they spotlighted the waste of taxpayer dollars, they also portrayed the GSA as an agency under siege for questionable spending on bonuses and lavish staff conferences in Las Vegas and other resorts.

Read more here: http://www.miamiherald.com/2012/08/06/2936382/lawmakers-chide-us-for-wasting.html#storylink=cpy

What a shame...  For those of you who haven't been in the central courtroom, you are really missing out.  I haven't been in a better courtroom.  You really feel like a lawyer:

Trial Tactics

I love following a good trial, and the Apple vs. Samsung fight is high drama.  Plus the case has the added bonus of seeing behind the Apple curtain.  Here's the latest from the WSJ:

On Friday, Scott Forstall, a senior vice president who oversees the software used on the company's mobile devices, testified that as early as January 2011, an Apple executive advocated that the company build a tablet with a 7-inch screen. Apple has generally disputed the appeal of devices smaller than its 9.7-inch iPad, despite reports the company is developing a smaller model.
In cross-examination, Mr. Forstall said Eddy Cue, now head of Apple's Internet services efforts, had used a 7-inch Samsung tablet for a time, and sent an email to Chief Executive Tim Cook that he believed "there will be a 7-inch market and we should do one."
Mr. Forstall also testified that Apple in 2004 placed unusual rules around how it would assemble a team to build the iPhone, or "Project Purple," as it was called then.
Mr. Forstall said co-founder Steve Jobs told him he couldn't hire anyone from outside the company to work on the user interface, or the buttons and images that appear on the screen. So, he said, he found "superstars" from within Apple and said he was starting a secret project and he wanted help.
He recalled telling them, "If you choose to accept this role, you will work harder than you ever have in your entire life."
Mr. Forstall described "locking down" one floor of the company's buildings at first with cameras and keycard readers to beef up security regarding the project. He also took to calling it the "purple dorm," after the project's code-name, purple. They also put a sign up on the front door with the words "Fight Club" written on it, referring to the hit book and movie in which characters are told not to talk about what they were doing.

Samsung wasn't sanctioned for the Quinn press release, but the judge wasn't happy:

Information that was not shared with jurors has triggered some of the biggest fireworks so far in the trial, which kicked off with jury selection Monday and testimony Tuesday and Friday. U.S. District Judge Lucy Koh blocked Samsung from introducing evidence that it says shows the iPhone design was inspired by Sony products, an attempt to weaken Apple positions that the iPhone was an original design copied by Samsung.
A Samsung representative shared the information with reporters, prompting a request from Apple for the court to sanction Samsung. On Friday, Judge Koh denied Apple's request, but criticized Samsung's legal team and polled each juror individually to make sure they hadn't read about it.
"I will not let any theatrics or sideshow keep us from doing what we're here to do," she said.

Koh didn't have any Pink Panther references though as did our very own Judge Cooke:

Cooke did not issue sanctions against any of the lawyers from Greenberg Traurig, whose chairman, Cesar Alvarez, had issued an apology to the judge during a May sanctions hearing after admitting “mistakes were made.”
In her 30-page ruling, the judge compared the firm and TD Bank’s legal defense to a popular comedy movie, saying “it often times appears that this litigation was conducted in an Inspector Clouseau-like fashion.
“However, unlike a ‘Pink Panther’ film, there was nothing amusing about this conduct, and it did not conclude neatly.”

Meantime, a jury acquitted John Keker's client in New York but issued an interesting statement along with its decision:

As Beau Brendler sat in the jury box listening to the government's case against a former Citigroup midlevel executive, the same question kept entering his mind.

"I wanted to know why the bank's C.E.O. wasn't on trial," said Mr. Brendler, who served as the jury's foreman. "Citigroup's behavior was appalling."

Despite that sentiment, Mr. Brendler and his fellow jurors - a group that included a security guard, a lab technician and a full-time musician in a rock 'n' roll band - cleared the former Citigroup executive, Brian Stoker, of wrongdoing over his role in selling a complex $1 billion mortgage bond deal during the waning days of the housing boom.

But even as the jury reached a consensus that the Securities and Exchange Commission failed to prove its case, it was left with an uneasy feeling that the verdict inadequately described its feelings about Citigroup's conduct.

"We were afraid that we would send a message to Wall Street that a jury made up of regular American folks could not understand their complicated transactions and so they could get away with their outrageous conduct," Mr. Brendler said. "We also did not want to discourage the government from investigating and prosecuting financial crimes."

So the jurors did something extremely rare: They issued a statement alongside their verdict.

"This verdict should not deter the S.E.C. from continuing to investigate the financial industry, review current regulations and modify existing regulations as necessary," said the statement, which was read aloud by Judge Jed S. Rakoff in Federal District Court in Manhattan on Tuesday.

Mr. Brendler, a 48-year-old freelance writer, wrote the sentence after soliciting input from the seven other jurors. He scratched it out on a yellow sheet ripped from a legal pad, wrapped it around the verdict form and put both in a sealed envelope that was delivered to the judge.

"It wasn't a particularly eloquent statement, but we hoped it would get a point across," Mr. Brendler said.

Keker used Where's Waldo in closing:

In explaining the verdict, both Mr. Dawson and Mr. Brendler said that they believed that Mr. Stoker was made a scapegoat for the industry's sins. In his closing statement, Mr. Stoker's lawyer, John W. Keker, hammered away at that point, arguing that his client "shouldn't be blamed for the faults of banking any more than a person who works in a lawful casino should be blamed for the faults of gambling."

Mr. Keker underscored this point by showing the jury an illustration from "Where's Waldo?," the children's book in which readers are challenged to find the hidden title character. He likened his client to Waldo, suggesting that Mr. Stoker, 41, was merely a blip in Citigroup's vast C.D.O. universe.

"Most of this trial had nothing to do with Brian Stoker," Mr. Keker said.

Mr. Dawson said that the "Where's Waldo?" allusion resonated.

"I'm not saying that Stoker was 100 percent innocent, but given the crazy environment back then it was hard to pin the blame on one person," Mr. Dawson said. "Stoker structured a deal that his bosses told him to structure, so why didn't they go after the higher-ups rather than a fall guy.

BREAKING -- Judge Cooke issues order in the TD Bank case

Here's the Order:

Order

The conclusion:

Upon review of all of the evidence I conclude that Rule 37 sanctions against Greenberg
Traurig and TD Bank are warranted. Having determined that TD Bank’s discovery violations were willful and resulted in prejudice to Coquina, I must determine what is the appropriate sanction in this case. Coquina urges that I strike TD Bank’s pleadings or its notice of appeal.
Discovery sanctions must be “just” and “specifically related” to the discovery violations.
See Ins. Corp. of Ireland, Ltd. v. Compagnie de Bauxites de Guinee, 456 U.S. 694, 707 (1982); Sierra Chevrolet, 446 F.3d at 1152. The discovery violations in this case resulted in Coquina’s diminished ability to prove that TD Bank’s actions were unreasonable and it had knowledge of fraud. Although the jury found in Coquina’s favor, Coquina now faces post-trial motions, which challenge the sufficiency of the evidence it put forth at trial on these issues. I will therefore direct that the facts that TD Bank’s monitoring and alert systems were unreasonable and that TD Bank had actual knowledge of Rothstein’s fraud be taken as established for purposes of this action. See Fed. R. Civ. P. 37(b)(2)(A)(i). This sanction will prevent further prejudice to Coquina in an eventual appeal on that issue. Greenberg Traurig and TD Bank shall also pay Coquina’s reasonable attorney’s fees and costs associated with bringing and litigating the Fourth and Fifth Motions for Sanctions and its Notice of Supplemental Evidence, and its reasonable attorney’s fees and costs associated with litigation resulting from TD Bank’s Notice of Withdrawal. This sanction serves to compensate Coquina for the added expense caused by Greenberg Traurig’s and TD Bank’s discovery violations and abusive conduct. See Carlucci, 775 F.2d at 1453. Coquina’s counsel shall file a motion for fees and costs within twenty days of this Order.

Judge Cooke, however, did not sanction the individual lawyers.

John Pacenti has the details:

U.S. District Judge Marcia Cooke in Miami found Cherry Hill, New Jersey-based TD Bank manipulated its attorneys and concluded Greenberg was negligent in its handling of the case brought by Corpus Christi, Texas-based Coquina Investments LLC. But she issued no sanctions against any individual attorneys at the Miami-based law firm. Over 200 Greenberg Traurig attorneys were involved in the case, the judge noted.
The investors won a $67 million judgment against the bank in January despite missing key documents, the judge concluded. Discovery violations weren't uncovered until later.
"I will note at the outset that it is difficult to accept that it was a mere coincidence that the late productions on the eve or during trial contained highly relevant documents," Cooke wrote in her 30-page order.
She painted the litigation as nearly farcical, invoking the classic Pink Panther comedy movies about a clumsy and inept detective.
"However, unlike the Pink Panther film, there was nothing amusing about this conduct and it did not conclude neatly," Cooke wrote.
She faulted the bank's in-house counsel for keeping Greenberg attorneys in the dark but also determined the legal term's discovery work was negligent, the legal standard for professional malpractice.
"TD Bank hides behind Greenberg Traurig's mistakes," Cooke wrote. "No one outside attorney was aware of the existence of all the discoverable or relevant materials. TD Bank's general counsel's office, on the other hand, had all the information."
The judge ordered the bank and law firm to pay Coquina's fees and costs for bringing two of five sanctions motion and issued two strong findings to ride with the bank's appeal — "TD Bank's monitoring and alert system were unreasonable and that TD Bank had actual knowledge of Rothstein's fraud."
Coquina had asked that all of TD Bank's pleadings be stricken. Cooke did not go that far but said her actions "will prevent further prejudice to Coquina in an eventual appeal on that issue."

Friday News & Notes

Quiet week in the District. Everyone seems to be away before school starts in a few weeks...

I posted earlier in the week about the Apple/Samsung opening statements. Looks like there was a lot more drama in that case. ATL has all the scoop about the Judge and John Quinn getting into it here. The latest update has Apple asking for sanctions.  And people think criminal law is contentious. 

John Pacenti covers the old Dyer building in an interesting article:

Mobster Meyer Lansky faced trial in the ceremonial courtroom. Deposed Panamanian dictator Manuel Noriega was tried and convicted there on drug charges. Crooked judges and police also faced juries in the historic David W. Dyer Courthouse, a downtown Miami landmark distinguished by its coquina stone facade.
But the courthouse was shut down in 2008 after the lung disease death of a federal magistrate and employees complained they worked in an environment fouled by toxic mold.
Now, the General Services Administration, the building's landlord, is asking developers for ideas about what to do with the one-time post office building. In a request made public Thursday, the agency said the options include an exchange, an exchange for services, a lease or sale.
On Monday, the House Subcommittee on Economic Development, Public Buildings and Emergency Management will meet at the courthouse on a hearing titled "Sitting on Our Assets: The Vacant Federal Courthouse."

 That's about it for now. Enjoy the weekend.

Khannnnnnnnnnnn!!!!!!!!!!!!

That's what Judge Scola must be feeling about the "Pakistani Taliban case."  Curt Anderson covers the recent issues here:

A once high-profile federal prosecution of an elderly Muslim cleric and one of his sons on terrorism finance charges has become bogged down in questions over the imam's mental stability and a legal fight over the testimony of defense witnesses who refuse to leave Pakistan, according to court records and interviews.
U.S. District Judge Robert Scola said in a recent order there is "bona fide doubt" regarding 77-year-old Hafiz Khan's mental fitness to stand trial. Prosecutors say Khan, imam at a downtown Miami mosque, was the ringleader of a group in the U.S. and Pakistan that funneled tens of thousands of dollars to the Pakistani Taliban terror group.
Details about Khan's mental issues were not provided in court documents, but he has appeared frail in court appearances and also suffered several physical health problems while in custody. If he is ultimately ruled incompetent for trial, under federal law Khan would undergo at least four months of treatment before a determination could be made on whether his competency might ever be restored.
Assistant U.S. Attorney John Shipley said in a court document filed Wednesday the government does not oppose a psychological evaluation of Khan, but he added that any evidence of mental problems so far is "unsupported and bare-bones, providing no detail at all." The test for competency in federal court is whether a person can effectively consult with his or her lawyer and can understand the legal proceedings involved.
The mental instability issue cropped up after prosecutors abruptly announced in June the dismissal of all charges against Irfan Khan, the elder of Hafiz Khan's sons. The younger son, Izhar, who is also a South Florida imam, remains jailed along with his father on charges of providing material support to terrorists that carry potential maximum prison sentences of 15 years for each count. Both have pleaded not guilty.

Patent trial of the century...

...between Apple and Samsung.  Opening statements were yesterday.  Some highlights (via InformationWeek):

Apple asserted in its opening statement of its infringement case against Samsung that the Korean firm analyzed and systematically copied one feature after another of its iPhone and iPad devices, then brought look-alike products to market. Apple designer Christopher Stringer, the trial's first witness, was asked by lead Apple attorney what he thought as he witnessed competitors bringing phones similar to the iPhone's design to market. "We'd been ripped off. It was plain to see, particularly by Samsung. We were offended," he said.
It was the punchline that Apple had been building toward on a day of opening statements, following Monday's jury selection of seven men and three women in U.S. District Court in San Jose on the opening day of the trial. The courtroom with limited seating was packed with attorneys, journalists, and observers, as was an overflow courtroom where sound and video were piped in. 

Looks like Apple got the better of opening statements.  You never want to start with the "keep an open mind" mantra.  And you better have your exhibits ready in opening:

Samsung lead attorney Charles Verhoeven was soon able to issue a rejoinder to the charges in his own 90-minute opening statement. But before he could launch into it, he felt constrained to remind the jury that they needed "to keep an open mind," that there was "more to the story than what you've just heard." Unlike Verhoeven's presentations, which frequently stopped and started again as he searched for the proper exhibit, Apple's narrative flowed from start to finish with a rising indignation. It moved toward what seemed an inevitable conclusion. Verhoeven seemed to understand its potential impact on a lay jury.
Apple's lead attorney, Harold McElhinny, started out, for example, by showing a simple graphic of six Samsung phones in a wide variety of form factors prior to the launch of the iPhone at Macworld in January 2007. Next to it, he showed Samsung phones being produced by 2010. They all have the rectangular proportions and rounded corners of the iPhone form factor.
McElhinny produced what he called a Samsung design document that compared iPhones, feature by feature, with Samsung's Galaxy model and noted whenever the iPhone's features were different. And the apparent design response in each instance was to "make something like the iPhone."
"To be blunt, Samsung has not been honest about this copying," he said.
Toward the end of his 90 minutes, McElhinny poured special effort into depicting Samsung as, not only an unscrupulous competitor, but so unethical that it failed to live up to its obligation to disclose pending patents to other members of an international standards body, the European Telecommunications Standards Institute (ETSI), as it was required to do.

 McElhinny seemed to be talking the jury's language.  Not so much for the other guy:

Samsung's Verhoeven, when his turn came, disputed the last assertion first. Samsung has made important contributions to wireless standards and under ETSI rules, confidential, proprietary information did not have to be disclosed during its application for a Korean patent. "Any suggestion otherwise is without merit," he said.

That's how lawyers talk.  Not jurors.  I wonder what the jury will think of this:

Verhoeven didn't deny that Samsung studied and duplicated some features of the iPhone. "Being inspired by a good product is not copying. It's competition, people competing with each other. There's nothing wrong with that," he said.

 If I'm Samsung, I'm hammering this point:

Samsung is a key supplier to Apple. Twenty-six percent of the iPhone is built using Samsung components, a situation that is expected to continue, regardless of the outcome of the trial. Under an avalanche of charges that Samsung copies rather than innovates on its own, Verhoeven responded that Samsung employs 1,000 of its own designers. It designs both components and its own products. It must be able to innovate on its own, if Apple keeps buying its products for its devices, he asserted. 

The cross of the first witness didn't go much better with asking the one question too many:

Apple lavished similar care on the user interface. "We wanted to make a device that was breathtakingly simple, something very easy to understand, something that you just wanted to pick up and use."
"It felt like an entirely new thing," he concluded.
Under cross examination, Verhoeven asked him if he had seen the similar Samsung designs. Stringer answered that he might have. "Did you see a design with four soft buttons at the bottom," Verhoeven persisted. Stringer answered that he might have, he wasn't sure.
"Did you think it was beautiful?" asked Verhoeven.
"Well," said Stringer, "it didn't stick in my mind."