DS9 Document EFTA00795588

• IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA JEFFREY EPSTEIN, Plaintiff, v. cor.50.2929aufactigIVP111, CASE NO. • A Aq SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and .M., individually, Defendants. COMPL CO Plaintiff, JEFFREY EPSTEIN, (hereinafter "EPSTEIN"), by and through his undersigned attorneys, files this action against Defendants, SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and L.M., individually. Accordingly, EPSTEIN states: SUMMARY OF ACTION Attorney Scott Rothstein aided by other lawyers and employees at the firm of Rothstein, Rosenfeldt, and Adler, P.A. for personal greed and enrichment, in betrayal of the ethical, legal and fiduciary duties to their own clients and professional obligations to the administration of justice, deliberately engaged in a pattern of racketeering that involved a staggering series of gravely serious obstructions of justice, actionable frauds, and the orchestration and conducting of egregious civil litigation abuses that resulted in profoundly serious injury to Jeffrey Epstein one of several targets of their misconduct EFTA00795588 Epstein v. RRA, et al. Page 2 and others. Rothstein and RRA's fraud had no boundary; Rothstein and his co- conspirators forged Federal court orders and opinions. Amongst the violations of law that are the subject of this lawsuit are the marketing of non-existent Epstein settlements and the sanctioning of a series of depositions that were unrelated to any principled litigation purpose but instead designed to discover extraneous private information about Epstein or his personal and business associates (including well-known public figures) in order to defraud investors and support extortionate demands for payinent from Epstein. The misconduct featured the filing of legal motions and ursuit of a civil litigation strategy that was unrelated to the merits or valu clients' cases and, instead, \ i s At had as its improper purpose the furthering o te 's misrepresentations and deceit to third party investors. As a result, Epstein was subject to abusive investigatory tactics, unprincipled media attacks, and unsupportable legal filings. This lawsuit is filed and will be vigorously pursued against all these defendants. The Rothstein racketeering enterprise endeavored to compromise the core values of both state and federal justice systems in South Florida and to vindicate the hardworking and honest lawyers and their K‘ e clients who adversely affected by the misconduct that is the subject of this Complain Plainti reserves the right to add additional defendants — co-conspirators as the facts and evidence is developed. GENERAL ALLEGATONS 1. This is an action for damages in excess of $15,000.00, exclusive costs, interest, and attorneys' fees. EFTA00795589 Epstein v. RRA, et al. Page 3 2. Plaintiff, EPSTEIN, is an adult and currently is residing and works in Palm Beach County, Florida. 3. Defendant, SCOTT ROTHSTEIN ("ROTHSTEIN"), is an individual residing in Broward County, Florida, and was licensed to practice law in the State of Florida. In November 2009, ROTHSTEIN voluntarily relinquished his law license in the midst of the implosion of Rothstein, Rosenfeldt and Adler, P.A. ("RRA"). He was disbarred by the Florida Supreme Court on November 20, 2009. On December 1, 2009, ROTHSTEIN was arrested and arraigned in Federal Court in Broward n , Florida. 4. At all times relevant hereto, ROTHSTEIN naging partner and CEO of RRA. 5. Defendant, ROTHSTEIN and Stuall osenfeldt, are and were the principal owners of equity in RRA and each co-founded RRA. 6. Defendant, BRADLEY J. EDWARDS ("EDWARDS"), is an individual residing in Broward County, Florida and is licensed to practice law in the State of Florida. At all times relevant hereto, EDWARDS was an employee, agent, associate, partner, shareholder, and/or other representative of RRA. 7. Defendant, L.M. ("L.M."), is an individual residing in Palm Beach County, Florida. At all times relevant hereto, L.M. was represented by RRA, ROTHSTEIN and EDWARDS in a civil lawsuit against Epstein and was an essential participant in the scheme referenced infra by, among other things, substantially changing prior sworn testimony, so as to assist the Defendants in promoting their fraudulent scheme for the EFTA00795590 Epstein v. RRA, et al. Page 4 promise of a multi-million dollar recovery relative to the Civil Actions (defined below) involving Epstein, which was completely out of proportion to her alleged damages. 8. Non-party, RRA is a Florida Professional Service Corporation, with a principal address of 401 East Las Olas Blvd., Suite 1650, Fort Lauderdale, FL 3340144ddition to its principal office, RRA also maintained seven offices in Florida, Cv York, and Venezuela, and employed over 70 attorneys and 200 support staff. RRA also maintains an office at 1109 NE 2d Street, Hallendale Beach, Florida 33009-85'15. RRA, through its attorneys, including those named as Defendant n, conducted business throughout Florida, and relevant to this action, coryft jusiness and filed lawsuits on behalf of clients in Palm Beach County, A bankruptcy. RRA is not named as a Deferidant FACTUAL ALLEGATIONS 9. The United States in United States of America v. Scott W. Rothstein Case No. 09-60331CR-Cohn, United States District Court, Southern District of Florida, has brought an action for Racketeering Conspiracy, 18 U.S.C. § 1962(d) against Scott W. Rothstein wh as the chief executive officer and chairman of RRA. Within the informati h as filed, the United States of America has identified the enterprise as bein law firm, RRA, through which Rothstein in conjunction with "his co- conspirators" (not yet identified by the USA) engaged in the pattern of racketeering through its base of operation at the offices of RRA from sometime in 2005 up through and continuing into November of 2009. Through various criminal activities, including mail fraud, wire fraud and money laundering, the United States of America asserts that a. (RRA is currently a debtor in EFTA00795591 Epstein v. RRA, et al. Page 5 Rothstein and his co-conspirators unlawfully obtained approximately $1.2 billion from investors by fraud in connection with a Ponzi scheme. The USA further alleges that "Rothstein and co-conspirators initiated the criminal conduct alleged in the instant Information in order to personally enrich themselves and to supplement the income and sustain the daily operation of RRA." In essence, in the absence of Rothstein and his co- conspirators conducting the Ponzi scheme, the daily operation of RRA, which included payroll (compensation to lawyers, staff, investigators, etc.), accounts' payable including unlimited improper, harassing and potential illegal in ig ion on cases, including Epstein-related matters, would in all likelihood wo e been sustainable. A copy of the information is attached as Exhibit 1 to thC act 10. As more fully set forth herein, RRA held itself out as legitimately and properly engaging in the practice of law. In reality, ROTHSTEIN and others in RRA were using RRA to market investments, as described below, so as to bilk investors out of hundreds of millions of dollars. ROTHSTEIN and others in RRA devised an elaborate plan through which were sold purported confidential assignments of a structured pay-out settlements, supposedly reached on behalf of RRA for clients, in exchange for immediate payments to these clients of a discounted lump sum amount. Investors were being promised in excess of a 30% return on their investment which was to be paid out to the investors over time. While some of the cases relied upon to induce investor funding were existing filed cases, it is believed that the confidential, structured pay-out settlements were all fabricated. EFTA00795592 • Epstein v. RRA, et al. Page 6 11. Based on media reports, Federal Bureau of Investigation (FBI) press conferences and releases and the Information the massive Ponzi scheme and pattern of criminal activity meant to lure investors began sometime in 2005 and continued through the fall of 2009, when the scheme was uncovered by some of the investors and the FBI. As of November of 2009, civil lawsuits were and continue to be filed against various Defendants as result of their massive fraudulent and criminal scheme. 12. This fraudulent and illegal investment scheme is also evidened by the filing of Amended Complaint For Dissolution And For Emergen nsfer of Corporate Powers to Stuart A. Rosenfeldt, Or, In The Alternative, F Adpointment of A Custodian or At k st Receiver by ROSENFELDT, and RRA, agai T s TEIN, individually. (Case No. 09 s 059301, In the Circuit Court of the Sevent nth Judicial Circuit, Broward County, 'I‘ Florida, Complex Business Div.) 'nler "RRA dissolution action, and attached 4 k hereto as Exhibit 2). 13. Plaintiff references e PRA dissolution action for the sole purpose that it acknowledges that RRA And ROTHSTEIN were in fact conducting an illegal and improper inv ent or Ponzi scheme based on promises of financial returns from settleme outcomes of supposed legal actions, including the actions brought against Plaintiff EPSTEIN. The RRA dissolution action alleges in part that — "ROTHSTEIN, the managing partner and CEO of the firm (RRA), has, according to assertions of certain investors, allegedly orchestrated a substantial misappropriation of funds from investor trust accounts that made use of the law firm's name (RRA). The investment business created and operated by ROTHSTEIN centered around the sale of EFTA00795593 Epstein v. RRA, et al. Page 7 interests in structured settlements." See Preliminary Statement of RRA dissolution action, Exhibit 2 hereto. 14. In furtherance of the scheme, RRA's letterhead was used in communications regarding investment opportunities in purported structured settlements. RRA's trust account was used to deposit hundreds of millions of dollars or wire transfer of monies from duped investors and other victims. RRA personally guaranteed payments. 15. Rothstein's scheme went so far as to manufacture false and fraudulent Court opinions/orders including forging the signatures of U. Marra and U.S. Circuit Court Judge, Susan H. Bla yet known if he forged similar documents in Exhibit 3 hereto. 16. The details of this fraudulent scheme are being revealed on a daily basis through various media reports and court documents. The most recent estimate of the financial scope of the scheme is that it exceeds $1.2 billion dollars. 17. Relevant to this action, EPSTEIN is currently named as a defendant in three civil actions alleging, inter alia, sexual assault and battery that were handled by RRA and its attorneys including EDWARDS prior to its implosion — one of which is filed in federal court (Jane Doe v. Epstein, Case No. 08-CIV-80893, U.S.D.C. S.D. Fla.)(Jane Doe is a named Defendant herein), and two of which have been filed in state court in the 15th Judicial Circuit Court, Palm Beach County, State of Florida, (L.M. v. Epstein, Case No. 502008CA028051XXXXMB AB; E.W. v. Epstein, Case No. 502008CA028058XXXXMB rict Judge, Kenneth A. rcuit in other cases. It is not n elated matters. See Composite EFTA00795594 Epstein v. RRA, et al. Page 8 AB), (hereinafter collectively referred to as the "Civil Actions," and L.M is a named Defendant herein). The Civil Actions were all filed in August and September of 2008. 18. What is clear is that a fraudulent and improper investment or Ponzi scheme was in fact conducted and operated by RRA and certain of the named Defendants, which scheme directly impacted EPSTEIN as a named defendant in the Civil Actions. 19. Miami attorney and developer, Alan Sakowitz, was quoted in a November 2009 article as saying that he had met with ROTHSTEIN as a potential investor in August of 2009, but became suspicious. He stated "I was convin was all a Ponzi scheme and I notified the FBI in detail how Scotty ROTH s hiding behind a legitimate law firm to peddle fake investments." Atto,r ak3witz was also quoted as saying ROTHSTEIN had sophisticated eavesdropping equipment and former law enforcement officers who would sift through a potential defendants' garbage looking for damaging evidence to use with investors to show how potential defendants could be in essence blackmailed into paying settlement that far exceeded the value of any legitimate damage claim. 20. Ft. Lauderdale attorney William Scherer represents multiple Rothstein related investors. He indicated in an article that RRA/Rothstein had used the "Epstein Ploy ... as a showpiece as bait. That's the way he raised all the money. He would use. . .cases as bait for luring investors into fictional cases. All the cases he allegedly structured were fictional. I don't believe there was a real one in there." In fact, on November 20, 2009, William Scherer, on behalf of certain clients, filed a 147 page Complaint against ROTHSTEIN, David Boden, Debra Villegas, Andrew Barnett, TD Bank, N.A., Frank EFTA00795595 Epstein v. RRA, et al. Page 9 Spinosa, Jennifer Kerstetter, Rosanne Caretsky and Frank Preve asserting various allegations that further prove the massive Ponzi scheme behind the RRA facade; and as of November 25, 2009, a 249 page Amended Complaint naming additional Defendants was filed. 21. In addition, and upon information and belief, ROTHSTEIN, David an, ebbie Villegas, Andrew Barnett, Michael Fisten and Kenneth Jenne (all employees of RRA) through brokers or middlemen would stage regular meetings during which false statements were made about the number of cases/cl at existed or RRA had against EPSTEIN and the value thereof. They w and share actual case files from the EPSTEIN actions with hedge fund mCige Thus, the attorneys and clients have waived any attorney-client or work- product privileges that otherwise may have existed. 22. Because potential investors were given access to some of the actual Civil Action files, investor-third parties may have became aware of a name of an existing Plaintiff who had filed anony ly against Epstein and had opposed disclosure of her legal #, name. c, 23. In III dttterinstances, by RRA, ROTHSTEIN and EDWARDS claiming the need for anonymity with regard to existing or fabricated clients, they were able to effectively use initials, Jane Doe or other anonymous designations which was a key element in the fraudulent scheme. Fictitious names could be created to make the investors believe many other cases existed against Epstein. EFTA00795596 Epstein v. RRA, et al. Page 10 24. In each of RRA's Civil Actions, the Plaintiffs are or were represented by RRA and its attorneys, including ROTHSTEIN and EDWARDS. 25. In addition, investors were told that in addition to the Civil Actions another fifty (50) plus anonymous females were represented by RRA, with the potential for hundreds of millions of dollars in settlements, and that RRA and its attorneys would sue Epstein unless he paid exorbitant-settlement amounts to protect his high-profile friends. 26. Upon information and belief, EDWARDS knew or should 'have known that ROTHSTEIN was utilizing RRA as a front for the mass selling an alleged interest or investment in the Ci • Epstein. 27. Further evidencing that EDWARDA possibly other attorneys of RRA) knew or should have known and participated in the continuation of the massive Ponzi scheme, a front-page Palm Beach Post article, dated November 24, 2009, reported on the recent filing of an amended 'forfeiture complaint by prosecutors against "dozens of ROTHSTEIN's real estate properties, foreign cars, restaurants and other assets — including $12 million in the lawyer's bank account in Morocco, along with millions more donated to political campaigns and charitable funds." The article further reported that - Attorney Scott ROTHSTEIN tapped into millions of dollars from his massive investment scam to cover payroll costs at his expanding Fort Lauderdale law firm, federal authorities said in court records released Monday. nzi scheme and/or were (and other claims) involving ROTHSTEIN's law firm (RRA) generated revenue of $8 million in one recent year, yet his 70-lawyer law firm had a payroll of $18 million, EFTA00795597 Epstein v. RRA, et al. Page 11 prosecutors said. ROTHSTEIN, who owned half of RRA used investors' money from his Ponzi scheme to make up the shortfall, they said. Subsequent articles and court filings have reflected ROTHSTEIN received compensation in excess of $35.7 million in 2008 and $10.5 million in 2009, w He his partner Rosenfeldt received greater than $6 million in 2008. 28. ROTHSTEIN attempted to lure the entity known as D3 Capita , -C, ("D3"), by offering D3 "the opportunity" to invest in a pre-suit $30,000y000.1 urt settlement L against EPSTEIN; yet this supposed settlement never exiitid.) and was entirely fabricated. To augment his concocted story, ROTHSTEIN, upon information and belief, invited D3 to his office to view thirteen (13) bankers boxes of case files in Jane Doe (one of the Civil Actions)' in an attempt to sit rbate that the claims against EPSTEIN were legitimate and that the evidence ob against him by RRA, ROTHSTEIN, and EDWARDS (the "Litigation Tea4 29. Upon information andlbe y)OTHSTEIN and others offered other investors like the entity D3 fabricated investment opportunities in the Civil Actions involving EPSTEIN. Fisten (a former Dade County police officer with a questionable police record and RRA investigator nne (a former attorney, Broward County Sheriff and felon) assisted ROTH making these offers by providing confidential, privileged and work- produ info + information to prospective third-party investors. ' It appears that 13 out of the 40 boxes seized by the FBI as part of its investigation at RRA consisted of files relating to the Civil Actions involving EPSTEIN, as reported by counsel for the Bankruptcy Trustee. Until those boxes can be reviewed, as well as other discovery, Epstein will not know the depth of the fraud and those involved. EFTA00795598 Epstein v. RRA, et al. Page 12 30. By using the Civil Actions against EPSTEIN as "bait" and fabricating settlements regarding same, ROTHSTEIN and others were able to lure investors into ROTHSTEIN'S lair and bilked them of millions of dollars which, in turn, was used to fund the litigation against EPSTEIN for the sole purpose of continuing the massive Ponzi scheme. 31. As part of this scheme, ROTHSTEIN and the Litigation Team, individually and in a concerted effort, may have unethically and illegally: a. Sold, allowed to be sold and/or assisted whale of an interest in non- settled personal injury lawsuits ( 1 r non-assignable and non- transferable) or sold non-existeitruc red settlements (including those cases involving Epstein); b. Reached agreements to share attorneys fees with non-lawyers; c. Used investor money to pay plaintiffs (i.e., L.M., E.W. and Jane Doe) "up front" money such that plaintiffs would refuse to settle the Civil Actions; d. Conducted searches, wiretaps or intercepted conversations in violation of IS , e or federal laws and Bar rules; and ~Itili ed the judicial process including, but not limited to, unreasonable and ` unnecessary discovery, for the sole purpose of furthering the Ponzi scheme. 32. Any such actions by ROTHSTEIN, and other attorneys, including the Litigation Team, directly or indirectly, would potentially be a violation of various Florida Bar Rules, EFTA00795599 Epstein v. RRA, et al. Page 13 including prohibiting the improper sharing of fees or costs and various conflicts of issues rules. 33. Evidencing that the Litigation Team knew or should have known of the improper purpose that ROTHSTEIN was pursuing in the continuation of thMheme, ROTHSTEIN used RRA's Litigation Team in the EPSTEIN cases to put issues and evidence unrelated to and unnecessary to the claims pled in th Actions, but significantly beneficial to lure investors into the Ponzi schEn6 orchestrated by ROTHSTEIN and other co-conspirators. 34. Upon information and belief, ROTHSTEIN claimed their investigators discovered that there were high-profile individas, offboard Epstein's private jet where sexual assaults took place and showed D3 (and possibly others) copies of a flight log purportedly containing names of celebrities, dignitaries, and international figures. 35. For instance, the Litigation Team relentlessly and knowingly pursued flight data and passenger manifests regarding flights EPSTEIN took with these famous individuals knowing full well that no underage women were onboard and no illicit activities took place. ROTHSTEIN and the Litigation Team also inappropriately attempted to take the depositions of these celebrities in a calculated effort to bolster the marketing scam that was taking place. 36. One of Plaintiffs' counsel, EDWARDS, deposed three of EPSTEIN'S pilots, and sought the deposition of a fourth pilot (currently serving in Iraq). The pilots were deposed by EDWARDS for over twelve (12) hours, and EDWARDS never asked one question relating to or about E.W., L.M., and Jane Doe (RRA clients) as it related to EFTA00795600 Epstein v. RRA, et al. Page 14 transportation on flights of RRA clients on any of EPSTEIN'S planes. But EDWARDS asked many inflammatory and leading irrelevant questions about the pilots' thoughts and beliefs (which will never be admissible at trial) which could only have been asked iiii‘ for the purposes of "pumping" the cases and thus by using the deposition sell the cases (or a part of them) to third parties. #4S 37. Because of these facts, ROTHSTEIN claimed that Epste wanted to make certain none of these individuals would be deposed and therefoie he had offered $200,000,000.00 to settle the claims of RRA female die v 'ous potential plaintiffs in actions against EPSTEIN. The offer of a $200 i lar settlement by EPSTEIN As t was completely fabricated; no such offer had 4 -be made. 38. EDWARDS' office also notified Defendant that he intended to take the depositions of and was subpoenaing: (i) Donald Trump (real-estate magnate and business mogul); (ii) Alan Dershowiti (noted Harvard Law professor, constitutional attorney and one of EPSTEIN'S criminal defense attorneys); ill Clinton (Former President of the United States); T mmy Mottola (former President of Sony Record); and (v) David Copperfield (illusionist). 39. The above-named individuals were friends and acquaintances of EPSTEIN with whom he knew through business or philanthropic work over the years. None of the above-named individuals had any connection whatsoever with any of the Litigation Team's clients, E.W., L.M. or Jane Doe. EFTA00795601 Epstein v. RRA, et al. Page 15 40. EDWARDS filed amended answers to interrogatories in the state court matters, E.W. and L.M., and listed additional high profile witnesses that would allegedly be called at trial, including, but not limited to: (i) Bill Richardson (Governor of New Mexico, formerly U.S. Representative and Ambassador to the United Nations); and (ii) Any and all persons having knowledge of EPSTEIN'S charitable, political or other donations;2 41. The sole purpose of the scheduling of these d sitions or listing high profile friends/acquaintances as potential witnesses w , to "pump" the cases to investors. There is no evidence to date tha f ese individuals had or have any r knowledge regarding RRA's Civil Action 42. n? O wa In furtherance of their i a fraudulent scheme against EPSTEIN, ROTHSTEIN, EDWARDS (who either know or should have known) and, at times, L.M. in her Civil Action against EPSTEIN: a) ded claims for damages in Jane Doe's federal action in rces s of $50,000,000.00 rather than simply alleging the jurisdictional limits. b) Organized a Jane Doe TV media interview without any legitimate legal purpose other than to "pump" the federal case for potential 2 These high-profile celebrity "purported" witnesses have no personal knowledge regarding the facts on these "Three Cases", but were being contacted, subpoenaed or listed to harass and intimidate them and Epstein, and to add "star" appeal to the marketing effort of the Ponzi scheme. EFTA00795602 Epstein v. RRA, et al. Page 16 investors or to prejudice Epstein's right to a fair trial in Palm Beach County. c) EDWARDS, Berger and Russell Adler (another named partner in RRA) all attended EPSTEIN's deposition. At that time, outrageous questions were asked of EPSTEIN which had no bearing on the case, but so that the video and questions could be shown to investors. d) Conducted and attempted to gi\ re discovery unrelated to the i Actions for the purpos ra sing and embarrassing witnesses and EPSTEIN and caus n&EPSTEIN to spend tens of thousands of dollars in unnecessary attorneys' fees and costs defending what appeared to be discovery related to the Civil Actions but was entirely related to the furtherance of the Ponzi scheme. EDWARDS was recruited and joined RRA in the spring of 09, the tone and tenor of rhetoric directed to cases against EPSTEIN used by Attorney EDWARDS and Berger changed dramatically in addressing the court on various motions from being substantive on the facts pled to ridiculously inflammatory and sound-bite rich such as the July 31, 2009, transcript when EDWARDS stated to the Court in E.W./L.M.: "What the evidence is really going to show is that Mr. Epstein — at least dating back as completely irrelevant r subject matter of the Civil EFTA00795603 Epstein v. RRA, et al. Page 17 far as our investigation and resources have permitted, back to 1997 or '98 — has every single day of his life, made an attempt to sexually abuse children. We're not talking about five, we're not talking about 20, we're not talking about 100, we're not talking about 400, which, I believe, is the number known to law enforcement, we are talking about thousands of children. . . and it is through a very intricate and complicated system that he devised where he has as many as 20 peo ing underneath him that he is paying well to schedu pointments, to locate these girls." f) As an example, EthV S filed an unsupportable and legally deficient Motion for Injunction Restraining Fraudulent Transfer of g) Assets, Appointment of a Receiver to Take Charge of Property of \4 7/ Epst1 dn to Post a $15 million Bond to Secure Potential ent, in Jane Doe v. Epstein Case No. 08-CV-80893- arra/Johnson. The motion was reported in the press as was the ultimate goal (i.e., to "pump" the cases for investor following). However, the Court found "Plaintiff's motion entirely devoid of evidence ... ", and denied the motion in toto. ROTHSTEIN told investors he had another 52 females that he represented, and that Epstein had offered $200 million to resolve, EFTA00795604 Epstein v. RRA, et al. Page 18 but that he could settle, confidently, these cases for $500 million, separate and apart from his legal fees. h) ROTHSTEIN and the Litigation Team knew or should have known that their three (3) filed cases were weak and had minimal value for the following reasons: (I) L.M. — testified she never had type of sex with Epstein; worked at numerous,)strip clubs; is an admitted prostitut II girl; has a history of illegal drug ainkillers, Xanax, Ecstasy); * r and conCiballS asserted the 5th Amendment during her depositions in order to avoid answering vent but problem questions for her; (ii) k — testified she worked at eleven (11) separate strip clubs, including Cheetah which RRA represented and in which ROTHSTEIN may have owned an interest; and E.W. also worked at Platinum Showgirls in Boynton Beach, which was the subject of a recent police raid where dancers were allegedly selling prescription painkillers and drugs to customers and prostituting themselves. (iii) Jane Doe (federal case) seeks $50 million from Epstein. She and her attorneys claim severe EFTA00795605 j) Epstein v. RRA, et al. Page 19 emotional distress as a result of her having voluntarily gone to Epstein's home. She testified that there was never oral, and or sexual intercourse; nor did she ever touch his genitalia. Yet, Jane Doe suffered extreme emotional distress echfr, well prior to meeting Epstein\ a result of having witnessed her father murderitils girlfriend's son. She was required matter and testimo ve sworn testimony in that d that she has lied in sworn alanTDoe worked at two different strip du including Platinum Showgirls in Boynton . i) Conduct culous and irrelevant discovery such as subpoenaihg records from an alleged sex therapist, Dr. Leonard in Massachusetts, when the alleged police report reflected t at EPSTEIN had only seen a chiropractor in Palm Beach named Dr. Bard. No records relating to EPSTEIN existed for this alleged sex therapist, Dr. Bard, and the alleged subpoena for records was just another mechanism to "pump" the cases for investor appeal; Allowed a Second Amended Complaint to be filed on behalf of L.M. alleging that EPSTEIN forced the minor into "oral sex," yet L.M. testified that she never engaged in oral, anal, or vaginal EFTA00795606 Epstein v. RRA, et al. Page 20 intercourse with EPSTEIN and she had never touched his genitalia. k) Told investors, as reported in an Associated Press article, that celebrities and other famous people had flown on EPSTEIN'S plane when assaults took place. Therefore, even though none (zero) of RRA's clients claim they flew of EPSTEIN'S planes, the Litigation Team sought pilot and plane logs. I Why? Again, to prime the investment "pump" w money without any relevance to the existing cla y the RRA clients. 41 /4 I) After EDWARDS joined RRA, EDWARDS and former Circuit Judge William Berger filed and argued motion to make the Non- Prosecution Agreement (NPA) between Epstein and USAO public. But, RRA, EDWARDS and Berger, and their three clients, already had a copy of the NPA. They knew what it said and they 1 4, the civil provisions in the agreement had no impact atsoever on the three pending Civil Actions. The concept behind certain civil provisions in the NPA was to allow an alleged victim to resolve a civil claim with Epstein, maintain her complete privacy and anonymity and move on with her life. As an assistant United States Attorney stated at a hearing in federal court, the NPA was not designed "to hand them a jackpot or a key to a bank." EFTA00795607 Epstein v. RRA, et al. Page 21 43. ROTHSTEIN, with the intent and improper motive to magnify his financial gain so continue to fund the fraudulent and illegal investment and/or Ponzi scheme, had EDWARDS demand excessive money from EPSTEIN in the Civil Actions. 44. The actions described in paragraph 42 above herein had no legitimate purpose in pursuing the Civil Actions against EPSTEIN, but rather were meant to further the fraudulent scheme and criminal activity of ROTHSTEIN so that he and others could fraudulently overvalue the settlement value of the existing and _non-existent nOn-existent claims against EPSTEIN to potential investors. 45. As a result of the fraudulent investme zi) scheme, RRA and its attorneys in the Civil Actions against EPSTEIN ma S have compromised their clients' fr., interests. ROTHSTEIN and the Litigation Team would have been unable to give unbiased legal counsel because outside investor(s) had been promised a financial interest in the outcome of the actions. Additionally, if a plaintiff received payments from investment monies while her action is pending, this clearly could impact the plaintiffs decision of whether or not to settle the current litigation or shade their testimony (i.e. commit perjury) to gain the greatest return on the investment and to further promote the Ponzi Scheme. 46. The truthfulness of L.M.'s allegations and testimony in L.M.'s state civil action have been severely compromised by the need to seek a multi-million dollar payout to help maintain RRA's massive fraud. Because fictitious settlements of tens of millions of dollars in cases relating to EPSTEIN were represented to "investors" in this Ponzi scheme, RRA and the attorneys in the Civil Actions needed to create a fiction that EFTA00795608 Epstein v. RRA, et al. Page 22 included extraordinary damages. However, the actual facts behind her action would never support such extraordinary damages. Therefore, extraordinary measures were undertaken to create an entirely inflated value of her claims against EPSTEIN. a. Though she held herself out as a "victim" of Epstein, she admitted to having returned over and over again to him despite her current claim of abuse. She lit has now admitted, under oath, to being a call girl/escort ce the age of 15. (in her deposition September 24, 2009 Transcript 280:16-19). She testified "Well, I lived life as a prostitute," 1'T 156:7) and "I am a prostitute when I make money" (see hl> 2-13). L.M. admitted her nin activity with men other than Epstei' g $1,000 a day from prostitution on maybe more than 20 occasions y one year alone (DT 157:11-158:21). L.M. admitted under oa _keeping a list of amounts she collected from ( "Johns" in "two or th' d books including a book of "Psalms" that she obtained from a religidus store (DT 152:1-14). Under the circumstances, her claim for damages against EPSTEIN, one of L.M.'s many "Johns" during that same period, would be so incredible and certainly not likely to produce the extraordinary settlements promised to "RRA's investors." 47. In April 2007, before she was represented by EDWARDS, and RRA, L.M. gave sworn taped recorded testimony to the agents of the FBI. She was represented by a lawyer other than EDWARDS at that statement. She spoke of EPSTEIN in a very positive and friendly terms and directly contradicted the central allegations on which L.M.'s civil action against Epstein is now based. However, once in the hands of EFTA00795609 Epstein v. RRA, et al. Page 23 EDWARDS and RRA, L.M.'s story changed dramatically. All of a sudden she wanted to sue EPSTEIN and like other RRA clients, sought tens of millions of dollars. a. For example, in her sworn statement to the FBI, L.M. was insistent that "Jeffrey is an awesome man." (p. 21 — FBI); At the conclusion of she stated: "I hope Jeffrey, nothing happens to Jeffrey because he's an awesome man and it really would be a shame. It's a shame that he has to go through this because he's an awesome guy and he didn't do nothing wrong, nothing." (pp. 57-58 - FBI). I EPSTEIN and her interactions wit informed a federal court in J consider L.M. a victim. A1/4 .M. spoke so highly of t the US Attorney's office 0 that the US Attorney could not Yet, by S@pterrlber 24, 2009, the date on which L.M. began her deposition i he civil action and now represented by RRA and EDWARDS, 1.M.'s new and very different tale about purported sexual misconduct under the supposed influence of EPSTEIN had been thoroughly rehearsed and her role into the ROTHSTEIN scam was complete. In her deposition in her civil action, L.M. declared that: "I, I don't really care about money." (DT 206:8) "He needs time in jail. He doesn't want to be — this is not right for him to be on the streets living daily . . ." (DT 219:21-23) EFTA00795610 Epstein v. RRA, et al. Page 24 "You don't think my whole life I have lived that shifty life because of Jeffrey Epstein?" (DT 222:7-8) b. In her sworn FBI testimony (pre-EDWARDS and RRA), L.M. was emphatic that her interactions with Epstein involved no iraropriate sexual touching in any way. In fact, it was exactly the opp Q: Did he at any point kiss you, touch you any kind of affection towards you? A: Never, never. (p. 21 — FBI) .. Q: So he never pulled you do t in a sexual way? A: I wish. No, no, ney eve ever, no, never. Jeffrey is an awesome man, no., BI) her second amended complaint in April 2009, after EDWARDS joined RRA, the allegations against EPSTEIN in <SL7 complaint became even more salacious. In paragraph 12 of .'s Second Amended Complaint, L.M. alleges among other things, that: "Jeffrey Epstein coerced, induced, or enticed . . .the then minor Plaintiff to commit various acts of sexual misconduct. These acts included, but were not limited to, fondling and inappropriate and illegal sexual touching of the then minor Plaintiff, forcing or inducing the then minor plaintiff into oral sex or other sexual misconduct..." EFTA00795611 Epstein v. RRA, et al. Page 25 c. In her sworn FBI statement (pre-EDWARDS and RRA), L.M. testified that the individual who first brought L.M. to EPSTEIN's home, told L.M. "make sure you're 18 because Jeffrey doesn't want any underage girls." (p. 8 - FBI). #4 4IC Yet at her September, 2009 deposition resented by 0 EDWARDS and RRA, L.M. told a very different st • lr l Q: My question was what did Caro I you to tell Mr. Epstein • about your age? A: She said it didn't matt 0: That's your recollection about what she said? A: Yes, she said — I remember her saying it doesn't matter. Don't worry about it. (DT 199:20-25) d. Pre-EDWARDS and RRA, L.M. testified to the FBI : "I always made sure - I had a fake ID, anyways saying that I was 18." (p. 8 - FBI). stated: Yet, when questioned about her fake ID at her September 2009 depo, she Q: And did you have a fake ID? A: No. Q: Have you ever had a fake ID? EFTA00795612 Epstein v. RRA, et al. Page 26 A: No. (DT 300:5-8) e. In her FBI statement (pre-EDWARDS and RRA), L.M. testified about others L.M. brought to the Epstein home. L.M. testified that women she brought to EPSTEIN's home were eager for the opportunity and content with their experiences: A: None of my girls ever had a problem and they6d call me. They'd beg me, you know, for us to go t y's house because they love Jeffrey. Jeffrey is a res . He really is. I mean, and he all thought we were of6 a ays. This is what's so sad about it. (p 30 - FBI). O: Did any of the girls complain about what happened after they left there? Aclitik, You asked me that question. No, everybody loved Jeffrey. <S e(p. 44 - FBI) +so A: Every girl that I brought to Jeffrey, they said they were fine with it. and like for example [E.W. — another of RRA's clients in the Civil Actions], a lot of girls begged me to bring them back for the money. And as far as I know, we all had fun there. (p. 45 - FBI) EFTA00795613 Epstein v. RRA, et al. Page 27 Yet, with EDWARDS and RRA as her attorneys, L.M. did a "180" at her September, 2009 deposition in saying: A: . . . Once they were there, they were scared out of their mind. They did it anyways and some of them walked out amid L.M. don't ever do this to me again. That was the worst that ever happened to me. (DT 170:6-11) . . . A: And then, a lot of girls weren't comfortable.' (DT 171:13) f. The above represent only a few oft atic changes L.M. made in her testimony prior to her representati ARDS/RRA and after she A..‘ hired ROTHSTEIN, EDWARDS and 48. As a result of the fraudulent investtrie or (Ponzi) scheme, L.M. may knowingly have compromised her alleged into inter Civil Action, or committed a fraud on the cktrit court. 14) 49. RRA and the Litigation Team took an emotionally driven set of facts involving alleged innocent, unsuspecting, underage females and a Palm Beach Billionaire and sought to turn it into a gold mine. Rather than evaluating and resolving the cases based on the merits (i.e. facts) which included knowledgeable, voluntary and consensual actions by each of the claimants and substantial pre-Epstein psychological and emotional conditions of each of the claimants and substantial sexual experiences pre- Epstein, RRA and the Litigation Team sought through protective orders and objections to block relevant discovery regarding their claimants. They instead forged ahead with discovery the main purpose of which was to pressure Epstein into settling the cases. EFTA00795614 Epstein v. RRA, et al. Page 28 Fortunately, their tactics have not been successful. As Magistrate Judge Linnea Johnson wrote in a discovery order dated September 15, 2009 (DE 299 in Federal Case #08-80119) in denying Plaintiffs' Motion for Protective Order: "This is his [Epstein's] right. The Record in this case is clear that the childhood of many of the Plaintiffs was marred by instances of abuse and neglect, which in turn may have resulted, in whole or in part, in the damages claimed by the Plaintiffs." Aci In addition, in an Omnibus Order dated October 009 (DE 377 in Federal Case #08-80119) Magistrate Judge Linnea John "Here the request at issue goes to the 1/4 lie of the Plaintiffs damage claims, requesting not only general information relating to Plaintiffs sexual history, but inquiring as to specific instances wherein Plaintiff received compensation or consideration for sex acts, claim other males sexually assaulted, battered, or abuses her, and/or claim 'other males committed lewd or lascivious acts on her. As a global matter, Plaintiffs clearly and unequivocally place their sexual history in issue by their allegations that Epstein's actions in this case has negatively affected their relationships by, among other things, "distrust in men," "sexual intimacy problems," "diminished trust," "social problems," " problems in personal relationships," " feeling of stress around men," "premature teenage pregnancy," "antisocial behaviors," and "hyper-sexuality and promiscuity." Considering these allegation, there simply can be no question that Epstein is entitled to know whether Plaintiffs were molested or the subject of other "sexual activity" or "lewd EFTA00795615 Epstein v. RRA, et al. Page 29 and lascivious conduct" in order to determine whether there is an alternative basis for the psychological disorders Plaintiffs claim to have sustained, whether Plaintiffs engaged in prostitution or other similar type acts and how certain acts alleged in the Complaint materially affected Plaintiffs' relationships with others or how those acts did not have such an affect on those relationships and/or whether Plaintiffs suffered from the alleged emotional and psychological disorders as a result of other sexual acts prior to the acts alleged in the CCmplaint. To deny Epstein thus discovery, would be tantamount to rri V g him from mounting a defense." 50. ROTHSTEIN, EDWARDS and L.M.'s,4os lonstitute a fraud upon EPSTEIN % as RRA, ROTHSTEIN and the Litigatio a presented themselves to be acting in -L good faith and with the bests intereS it clients in mind at all times when in reality, they were acting in furtherance of the investment or Ponzi scheme described herein. EPSTEIN justifiably relied to his detriment on the representations of RRA, and Defendants, ROTHSTEIN, EDWARDS and L.M. as to how he conducted and defended the Civil Actions brought against him. 51. As a direct and proximate result of the fraudulent and illegal investment or Ponzi scheme orchestrated by ROTHSTEIN and as yet other unknown co-conspirators and as a result of the litigation tactics undertaken by the Litigation Team and L.M. as set forth herein, Plaintiff EPSTEIN has incurred and continues to incur the monetary damages including, but not limited to, having to pay an amount in excess of the Civil Actions' true value as a result of them refusing to settle in that a percentage of any payment by EFTA00795616 Epstein v. RRA, et al. Page 30 EPSTEIN may have been promised to third party investors; incurring significant additional legal fees and costs as result of Defendants refusal to conduct settlement negotiations in a forthright and good faith manner because any monies paid by EPSTEIN is in reality a promised return on an investment; and incurred significant attorneys' fees and costs in defending the discovery that was not relevant, material and/or calculated to lead to the admissibility of evidence, but which was done for the sole purpose of "pumping" the cases to investors. 52. EPSTEIN has also been injured in that the sco or racketeering activity so permeated the R IN prevented from fully and fairly defending • il ctions brought against him. In essence, the very existence of RRA was base on the continuation of the massive Ponzi scheme orchestrated by ROTHSTEIN and other co-conspirators. In order to continue to bring in monies from investors, ROTHSTEIN and other co-conspirators used the Civil Actions against EPSTEIN, along with other manufactured lawsuits, as a means of obtaining massive amounts of money. 53. ROTHSTEIN, EDWARDS and L.M. are liable for damages caused to EPSTEIN — individually, and jointly and severally. fraudulent and criminal that EPSTEIN has been Count I — Violation of §§772.101, et seg.,,Fla. Stat. - Florida Civil Remedies for Criminal Practices Act — Against All Defendants 54. Plaintiff realleges and incorporates paragraphs 1 through 53 as if fully set forth herein. EFTA00795617 Epstein v. RRA, et al. Page 31 55. RRA, ROTHSTEIN, EDWARDS and L.M. each and collectively constitute an enterprise pursuant to §772.102(3), Fla. Stat. (2009). 56. ROTHSTEIN, EDWARDS and L.M. engaged in a pattern of criminal activity as defined in §772.102(3) and (4), Fla. Stat. (2009). 57. As alleged herein, ROTHSTEIN and EDWARDS committed ma predicate acts in violation of §772.103(1), (2), (3) and (4), Fla. Stat., including violations of Florida Statutes - Chapter 517, relating to securities transactions; Chapter 817, relating to fraudulent practices, false pretenses, and fraud generally hich includes L.M.); Chapter 831, relating to forgery; §836.05, relating to extorti includes L.M.); and Chapter % 4 837, relating to perjury (which includes L. b antially more than two predicate Ak, acts (i.e., the selling of or participation of the sale of fabricated settlements outlined herein, including the Civil Actions involving Epstein as well as the improper litigation tactics outlined above) occurred within a five-year time period. 58. As a direct and proximate result of ROTHSTEIN, EDWARDS and L.M.'s violations of §772.103, Fla. Stat., EPSTEIN has been injured. 59. Pursuant to §772.104(1), Fla. Stat., Plaintiff EPSTEIN is entitled to threefold of his actual damages sustained, reasonable attorney's fees and court costs, and such other damages as allowed by law. WHEREFORE, Plaintiff EPSTEIN respectfully demands the entry of a judgment for damages against all the named Defendants. Count II — Florida RICO - "Racketeer Influenced and Corrupt Organization Act" Pursuant to 4095.01, et seq., Fla. Stat. (2009), Against All Defendants EFTA00795618 Epstein v. RRA, et al. Page 32 60. Plaintiff realleges and incorporates paragraphs 1 through 53 as if fully set forth herein. 61. RRA, along with ROTHSTEIN, EDWARDS and L.M., each and co ectively, constitute an enterprise pursuant to §895.02(3), Fla. Stat. (2009). 62. During all times relevant hereto, ROTHSTEIN, EDWARDS . were and are associated with the enterprise, RRA, and each other. 63. Defendants, ROTHSTEIN, EDWARDS and L.M., as perso associated with the enterprise, RRA and each other (as an enterprise), unlawfully conducted or participated, directly or indirectly, in such an enterprise through a pattern of racketeering, § 895.03(3), Fla. Stat., as alleged above herein. * 64. The breadth and scope of RQWEIN, EDWARDS and, potentially, L.M.'s 4 racketeering activity continues t tigated by the FBI, as numerous civil lawsuits against some of the Defencatit dt others continue to be filed by persons who have been damaged. As of the filing of this Complaint, criminal charges have only been brought against ROTHSTEIN. A45 65. Subs at b more than two predicate acts (i.e., the selling of fabricated settle ined herein, including the Civil Actions involving Epstein as well as the impro r litigation tactics outlined above) occurred within a five year time period. 66. Pursuant to §895.02, Fla. Stat., ROTHSTEIN and EDWARDS engaged in a pattern of "racketeering activity through the commission of crimes as defined in § 895.02(1)(a)-(b), Fla. Stat., including Chapter 517, relating to securities; Chapter 817, relating to fraudulent practices, false pretenses, and fraud (including L.M.) generally; EFTA00795619 Epstein v. RRA, et al. Page 33 Chapter 813, relating to forgery; §836.05, relating to extortion (including L.M.); Chapter 837, relating to perjury (including L.M.). 67. Pursuant to §895.05, Fla. Stat., Plaintiff seeks the following relief against Defendants, ROTHSTEIN, EDWARDS and L.M.: i a) Ordering ROTHSTEIN and EDWARDS to divest mse ves of any interest in the enterprise, RRA; t n b) Enjoin all Defendants from engaging in t a C l e type of conduct and activities as described herein:' c) Temporarily enjoining ROTk DWARDS and L.M., from the continuation of th lions brought against EPSTEIN until criminal charges have been formally brought against RRA and/or any of the Defendants, such that EPSTEIN may be allowed to evaluate whether a stay or dismissal of all Civil Actions against him is merited. 68. EPSTEIN further seeks an award of his reasonable attorney's fees and costs, and such other relief that this Court deems appropriate. WHEREFORE, Plaintiff EPSTEIN respectfully demands the entry of a judgment for the relief sought and damages against the named Defendants. Count III - Abuse of Process — Against All Defendants 69. Plaintiff realleges and incorporates paragraphs 1 through 53 as if fully set forth herein. EFTA00795620 Epstein v. RRA, et al. Page 34 70. After instituting the Civil Actions against EPSTEIN, the actions of Defendants, ROTHSTEIN, EDWARDS and L.M. as alleged in paragraphs 9 through 53 herein, constitute an illegal, improper or perverted use of process. 71. ROTHSTEIN, EDWARDS and L.M. possessed ulterior motives or ses in exercising such illegal, improper, or perverted use of process. 72. As a result of ROTHSTEIN, EDWARDS and L.M.'s actions PSTEIN suffered damages. WHEREFORE, Plaintiff EPSTEIN respectfully demandthe IV -fraud e entry of a judgment for , damages against all the named Defendants. Against All Defendants 73. Plaintiff realleges and incorporate aragraphs 1 through 53 as if fully set forth herein. 74. ROTHSTEIN, by ar Defendant EDWARDS and L.M. made false statements of fact to EPS IN)and his attorneys and agents, known to be false at the time made, and/or intentionally concealed material information from EPSTEIN and his attorneys and agents, for the purpose of inducing EPSTEIN to act in reliance thereon. 75. EPSTEIN did so act on the misrepresentation and/or concealment by incurring additional attorney's fees, costs, and expenses in aggressively defending the civil actions whereas in reality, because the Civil Actions against Plaintiff were being exploited and over-valued so as to lure additional investors and to attempt to extort as much money as possible from EPSTEIN so as to continue the massive fraud. EFTA00795621 Epstein v. RRA, et al. Page 35 WHEREFORE Plaintiff EPSTEIN demands judgment against Defendants for damages incurred and for any other relief to which he is entitled under the law. Conspiracy to Commit Fraud Against All Defendants 76. Plaintiff realleges and incorporates paragraphs 1 through 53, and 7 as if fully set forth herein. 77. ROTHSTEIN, EDWARDS and L.M. conspired to commit t i on EPSTEIN. 78. ROTHSTEIN, EDWARDS and L.M. combined by th gh concerted action as detailed herein to accomplish an unlawful purpos mplish some purpose by unlawful means. The unlawful purpose was, among other things, the orchestrating and continuation of the massive fraudulent Ponzi scheme and receipt of monies for the continuation of the scheme. The unla eans includes, but is not limited to, the use of the Civil Actions against EPS I unlawful, improper, and fraudulent manner. 79. As a direct and prcNi e) result of ROTHSTEIN, EDWARDS and L.M.'s conspiracy to defraud EPSTEIN, EPSTEIN suffered damages. WHEREFORE Plaintiff EPSTEIN demands judgment against Defendants for damages incurred and for any other relief to which he is entitled under the law. Jury Trial Plaintiff demands Jury Trial on all issues so triable. By: ROBERT pr. CRITTON, JR., ESQ. Florida r No. 224162 EFTA00795622 Epstein v. RRA, et al. Page 36 rcritabcIclaw.com MICHAEL J. PIKE, ESQ. Florida Bar #617296 moike bcfclaw.com BURMAN, CRITTON, LUTTIER & COLEMAN 303 Banyan Blvd., Suite 400 West Palm Beach, FL 33401 561-842-2820 Fax: 561-253-0154 (Attorneys for Plaintiff) 4 49 EFTA00795623 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 1 of 36 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NO9 66603 cr.) 1 18 U.S.C. §1962(d) 18 U.S.C. §1956(h) 18 U.S.C. §1349 18 U.S.C. §1343 18 U.S.C. § 2 18 U.S.C. §1963 18 U.S.C. §982(a)( I) 18 U.S.C. §98 I (a)( I )(C) O UNITED STATES OF AMERICA, Plaintiff, v. SCOTT W. ROTHSTEIN, Defendant. ORMATION The United States C A ges that, at all times relevant to this Information: GENERAL ALLEGATIONS I. Scott hstein was an attorney admitted to practice law in Florida. Defendant Rothstein wilt& Chief Executive Officer (CEO) and Chairman of Rothstein, Rosenfeldt and Adler, CR-COHN 14.6.alS1 RA ! c, 1U1D{ 6WCZARI • - FILED by DEC 0 1 2009; STEVEN M. LARIMORE CLERK U. S. DIST. CT. S. D. of FLA. - FT. LAUD. Rothstein, Rosenfeldt and Adler, P.A. was a law firm with offices located at 401 East Las Olas Boulevard, Fort Lauderdale, Florida and elsewhere. The law firm employed approximately seventy (70) attorneys and engaged in the practice of law involving a wide range of specialties, including labor and employment law. EXHIBIT I P.47IP.7 :: L; EFTA00795624 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 2 of 36 COUNT I (Racketeering Conspiracy, 18 U.S.C. §I 962(d)) 1. The General Allegations of this Information are realleged and expressly incorporated herein as if set forth in full. THE ENTERPRISE 2. The law firm, Rothstein, Rosenfeldt and Adler, P.A. (hereinafter re to ) was a legal entity organized under the laws of the State of Florida and cons nterprise as that term is defined in Title IS, United States Code, Section 1961(4). .rise engaged in, and the activities of which affected, interstate and foreign commerce. THE RACKETEERING CONSPIRACY S 3. From in or about 2005 and continui t nor about November 2009, in the 44 .t Southern District of Florida and elsewhere, th e SCOTT HSTEIN, being a person employed by and as the Enterprise described above, which was engaged in, and the activities of whi interstate and foreign commerce, did knowingly combine, conspire, confederate, and a ith persons known and unknown to the United States Attorney, to violate Title 18, Urn States Code, Section 1962(c); that is, to conduct and participate, directly and indirect e conduct of the affairs of the Enterprise through a pattern of racketeering activity e at a.si efined in Title 18, United States Code, Sections 1961(1) and (5), as set forth herein b paragraph 4. 2 EFTA00795625 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSO Docket 12/01/2009 Page 3 of 36 THE PATTERN OF RACKETEERING ACTIVITY 4. The pattern of racketeering activity as defined in Title 18, United States Code, Sections 1961(1) and 1961(5), through which the defendant and his co-conspirators agreed to conduct and participate, directly and indirectly, in the conduct of the affairs of the Enterprise consisted of multiple acts indictable under the laws of the United States, namely: i. Title 18, United States Code, Section 1341 (mail fraud); ii. Title 18, United States Code, Section 1343 (wire ki iii. Title 18, United States Code, Section 1956(a)( tindering of monetary instruments); iv. Title 18, United States Code, 57 (engaging in monetary transactions); and v. Title 18, United States monetary instruments Se ion 1956(h) (conspiracy to launder in monetary transactions. THE PURPOSE AND OBJEC E RACKETEERING ACTIVITY 5. The principal p eketeering conspiracy was to generate money for the defendant and his co-cons ugh the operation of the Enterprise and through various criminal activities, includin fraud, wire fraud, and money laundering. 6. The de t and his co-conspirators agreed to engage in a pattern of racketeering activity se of operation at the offices of RRA. The conspirators also utilized other r the objectives of the Enterprise. RRA was utilized by the defendant and his co- co t rs to unlawfully obtain approximately $1.2 billion from investors by fraud in connection with an investment scheme commonly known as a "Ponzi" scheme, in which new investors' funds 3 EFTA00795626 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 4 of 36 are utilized to pay previous investors in the absence of any underlying security, legitimate investment vehicle or other commodity. THE ROLES AND RESPONSIBILITIES OF THE CONSPIRATORS 7. The roles of the conspirators were as follows: A. Defendant SCOTT W. ROTHSTEIN was a shareholder, Chairman and CEO'of RBA. <>/- Through his position at RRA, defendant ROTHSTEIN promoted, managed, a pervised the administration of the Enterprise by fraudulently inducing investors through the use of false statements, documents, and computer records to (1 ) loan money to purported borrowers based upon fraudulent promissory notes and fictitious bridge loans, and (2 es ds based upon anticipated pay-outs from purported confidential settlement agree n had been reached between and among certain individuals and business entities. le ent agreements were falsely presented as having been reached between putative pl vil cases and putative defendants based upon the forbearance of civil claims in sex ent and/or whistle-blower cases. B. Other conspirato d unknown to the United States Attorney, agreed with one another and with defen t R HSTEIN to take actions to further the operation and success of the "Ponzi" schem, eluding presenting the aforesaid investments to potential investors as legitimate inv ent vehicles, when in fact they were not; fraudulently inducing investors to place funds i in estment vehicles by making material misstatements of facts as set forth below; ntial investors and investors that sufficient funds existed to pay returns on these inves ents, when in fact such funds did not exist; creating, and transferring funds into and from, various accounts at financial institutions in order to further the unlawful scheme; and realizing 4 EFTA00795627 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 5 of 36 profits from the operation of the Ponzi scheme through the acquisition of money generated as proceeds from the scheme and through the acquisition of real and personal property. MANNER AND MEANS OF THE RACKETEERING CONSPIRACY 8. It was part of the conspiracy that the defendant agreed that a conspirator would commit at least two acts of racketeering activity in the conduct of the affairs of the EnterPrise. 9. Defendant ROTHSTEIN and other co-conspirators initiated the criminal conduct _ - alleged in the instant Information in order to personally enrich themselves and to, supplement the income and sustain the daily operation of RRA. 10. Defendant ROTHSTEIN and other co-conspi dulently solicited investors to loan money based upon promissory notes and bridge from purported clients of RRA. Defendant ROTHSTEIN falsely alleged that cli requested short-term financing for undisclosed business deals. Defendant RO< Isely alleged that the purported clients were willing to pay high rates of return on loans negotiated by Defendant ROTHSTEIN. In fact, defendant ROTHSTEIN was aware that no such clients or requests for business financing actually existed. II. Defendant ROTHSTEIN and other co-conspirators participated in an investment scheme commonly known as a "Ponzi" scheme. The "Ponzi" scheme involved the sale of purported confidential s ement agreements in sexual harassment and/or whistle-blower cases. The potential investo ol y defendant ROTHSTEIN and other co-conspirators that confidential settlement re available for purchase. The purported settlements were allegedly available in amounts ranging from hundreds of thousands of dol lars to millions of dollars and could be purchased at a discount and repaid to the investors at face value over time. 5 EFTA00795628 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 6 of 36 12. Defendant ROTHSTEIN and other co-conspirators utilized the offices of RRA and the offices of other co-conspirators to convince potential investors of the legitimacy and success of the law firm, which enhanced the credibility of the purported investment opportunity. 13. Defendant ROTHSTEIN and other co-conspirators made false and misleading 4167 , statements and omissions which were intended to fraudulently induce potential - ors into 14. Defendant ROTHSTEIN and other co-conspirators made g fraudulent representations to potential investors in order to induce them to purch rted settlements: dential in order to protect the settlement and the executives purchasing the confidential settlements. A. That the purported settlements were hi reputation of the company au involved; B. That the plaintiffs i d sexual harassment and/or whistle-blower cases prefe sett the cases in order to avoid the emotional embarr ursuing a claim in a public forum; C. That mated its own cases from reputation, internal staff and outside <lc at RRA retained a company that owned internet sites and well-placed t o, rrals from other law firms; "800" numbers designed to attract a large volume of high quality cases; That RRA rigorously screened the purported sexual harassment and/or whistle-blower settlement agreements; 6 EFTA00795629 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 7 of 36 F. That RRA utilized former law enforcement personnel and employed highly sophisticated investigative methods in selecting and pursuing claims against purported defendants; G. That RRA or other law firms pursued purported settlements with defendant companies prior to the initiation of litigation; H. That RRA or other law firms negotiated with the pui ed defendant company after such company was made aware of the alleged claim by the J. K. M plaintiff; That RRA or other law firms purpo, company and reached an agree and the payment terms; That because the p litigation, th transact C Tha e al e ed defendant companies sent by wire transfer to RRA or other f rms' trust accounts the full proceeds of the purported settlements; during the settlement conference or other settlement negotiations when a purported plaintiff protested the extended payment schedule, RRA or other law firms presented the purported plaintiff with the option of receiving a discounted lump sum payment from an unrelated confidential funding source; That RRA or other co-conspirators prepared a purported Assignment of Settlement Agreement in which the investor agreed to acquire the right to the gotiated with the defendant contained the settlement amount lements occurred prior to the initiation of as no court or governmental entity involved in the 7 EFTA00795630 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 8 of 36 investors that funds were maintained in designated trust accounts for investor and that these funds were verified on a regular basi independent verification sources, one being an attorneys. r being an independent financial advisor (hereinafter referred to "independent ve 16. Defendant ROTHSTEIN investors that RRA's trust accounts in ned with a well established international banking institution, in accordance with d regulations of the Florida Bar, and that access to balances in the trust accoun I egedly monitored by one of the two independent verifiers. 17. Defendant ROTHSTEIN and other co-conspirators falsely informed potential 7 investors that e diligence would be undertaken with the following provisions: An "independent verifier" would be permitted to ask questions of Defendant ROTHSTEIN and/or other co-conspirators to review the opportunity and structure; B. The "independent verifier" would have the opportunity to randomly review selected completed transactions to confirm the veracity of the information; purported settlement payments for a discounted lump sum payment made to the purported plaintiff; N. That when RRA received the payment by the investor it immediately disbursed those funds to the purported plaintiff; and O. That RRA made payment to the investor pursuant to the purpgtayment schedule set forth in the purported settlement agreement. 15. Defendant ROTHSTEIN and other co-conspirators false ed potential fit of the individual if not more often, by two -conspirators falsely informed potential 8 EFTA00795631 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 9 of 36 C. The "independent verifier" had already reviewed current transactions, including wire transfers received from defendants and payments made to plaintiffs; D. The "independent verifier" would have the opportunity to visit and speak with a senior banking officer at the local branch of the financial institution to confirm current trust account bank balances through bank statements provided on line; and E. The "independent verifier" had the opportunity t officer to verify that the trust acco strength of MIA's financial poi o bank. 18. with the S ti 18. Defendant ROTHSTEIN and o Witha senior banking "locked" and to verify the spirators established numerous trust c i al an accounts in the name of RRA in order to c 'net nti d current investors of the legitimacy of the confidential settlement agree d t e security of such investments. 19. Defendant ROTHSTEIN and other co-conspirators prepared and used altered bank statements, purportedly issued fitim a well-established international financial institution, to fraudulently convin tential and current investors that funds had been received from the purported defendant co i t(ces d were maintained in trust accounts. rder to deceive investors, defendant ROTHSTEIN and other co-conspirators In d and/or maintained fictitious online banking information regarding the purported trust accottl5ts which falsely reflected the amount of funds maintained in such accounts, the receipt of funds wired from the alleged defendant companies and the transmission of funds by wire to the alleged plaintiffs, 9 EFTA00795632 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 10 of 36 21. Defendant ROTHSTEIN and other co-conspirators created false and fictitious documents, including confidential settlement agreements, assignment of settlement agreements and proceeds, sale and transfer agreements, and personal guaranties by Defendant ROTHSTEIN, among other documents. 22. Defendant ROTHSTEIN and other co-conspirators facilitated the em and transfer of funds between and among numerous trust accounts and operatin: aunts in order to perpetuate the scheme. The movement and transfer of such funds insure a in the individual trust accounts in order to make scheduled payments Illiay)stors. frtla $ were available 23. Defendant ROTHSTEIN and other co-consp de false statements to current investors in order to convince them to re-invest in i urported confidential settlement M agreements. 24. Defendant ROTHSTEIN and other aspirators facilitated the creation of false and fictitious "lock letters" which were issued by an executive at the financial institution where the trust and operating accounts were maintained. Such "lock letters" falsely reflected that the funds maintained in specific trust accouhis would only be disbursed to specific investors. 25. Defendant ROTHSTEIN and other co-conspirators utilized funds received from ( 7 investors to4i% •,' • "return promised on investment" to earlier investors. D Pendant ROTHSTEIN and other co-conspirators also initiated and conducted a efraud clients of RRA in order to perpetuate the "Ponzi" scheme. Such clients had retained RRA to institute and file a civil lawsuit. Unknown to the clients, RRA settled the lawsuit and obligated the clients to pay $500,000 to the defendant. In order to commit the fraud and deceive the clients, defendant ROTHSTEIN and other co-conspirators created a false and fraudulent court 10 EFTA00795633 ' • 4 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 11 of 36 order purportedly signed by a Federal District Court Judge which falsely alleged that the clients had prevailed in the lawsuit and were owed a judgement of approximately S23 million. The fraudulent court order also falsely stated that the defendant had transferred funds to the Cayman Islands in order to avoid paying the judgement. 27. Defendant ROTHSTEIN and other co-conspirators falsely advised the dEents on NJ P several occasions that in order to recover the defendant's funds, they had to post bonds to be held in the RRA trust account. Defendant ROTHSTEIN and other co-conspirators fraudulently caused the clients to wire transfer approximately $57 million over several yearatittrust account controlled by defendant ROTHSTEIN, purportedly to satisfy the bond 28. Defendant ROTHSTEIN and other co-Gans \ to)§ caused the funds transmitted by '-\' the clients to be transferred to other RRA trust inb,, rder to perpetuate the "Ponzi" scheme an IS fr, d to enrich those co-conspirators who as fed with the Enterprise. 29. Defendant ROTHS o er co-conspirators were questioned by the clients as to the progress of the alleged I ) 4p order to delay the return of funds to the clients, defendant ROTHSTEIN fraudulently created a false Federal court order purportedly issued by a United States Magistrate Judge allegedly ordering RRA to return the transmitted funds by a later date. 30. fendant ROTHSTEIN and other co-conspirators utilized funds obtained through the "Po e to supplement and support the operation and activities of RRA, to expand RRA ng of additional attorneys and support staff, to fund salaries and bonuses, and to acquire larger and more elaborate office space and equipment in order to enrich the personal wealth of persons employed by and associated with the Enterprise. II EFTA00795634 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 12 of 36 31. Defendant ROTHSTEIN and other co-conspirators utilized funds illegally obtained through the "Ponzi" scheme to make political contributions to local, state and federal political candidates, in a manner designed to conceal the true source of such funds and to circumvent state and federal laws governing the limitations and contribution of such funds. 32. Defendant ROTHSTEIN and other co-conspirators used other corporatioa in order to launder proceeds generated from the "Ponzi" scheme to conceal the source of elfunds utilized to make political contributions in order to promote the "Ponzi" scheme. 33. Defendant ROTHSTEIN and other co-conspirators pai ybonuses to employees of RRA purportedly as an award for exemplary work. P receipt of the bonuses, the employees were instructed to make large contributio t al candidates in the employees' ae names. Such conduct was designed to conceal /••• circumvent campaign finance laws. so c,e of the contribution and to illegally 34. Defendant ROTHSTEIN and other co-conspirators distributed lavish gifts including exotic cars, jewelry, boats, loans, cash and bonuses to individuals and members of RRA in order to engender goodwill and loyalty and to create the appearance of a successful law firm. 35. Defendant / ROTHSTEIN and other co-conspirators made large charitable contributions43ublic land private charitable institutions, including hospitals and other legitimate charita rofit organizations using funds derived from the "Ponzi" scheme. Defendant ROTHSTEIN and other co-conspirators utilized funds illegally obtained through the "Ponzi" scheme to hire members of local police departments purportedly to provide security for RRA and defendant ROTHSTEIN's personal residence. "Ponzi" scheme funds were also used to provide gratuities to high ranking members of police agencies in order to curry favor 12 EFTA00795635 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 13 of 36 with such police personnel and to deflect law enforcement scrutiny of the activities of RRA and defendant ROTHSTEIN. 37. Defendant ROTHSTEIN and other co-conspirators utilized funds obtained through the "Ponzi" scheme in order to purchase controlling interests in restaurants located in the Southern District of Florida. Such restaurants were used in part as a mechanism to give, gratinties to individuals, including politicians, business associates and attorneys, in order to foster goodwill and loyalty, as a location to solicit potential investors and as a secure location for conspiratorial meetings. 38. Defendant ROTHSTEIN and other co-conspirators associated with affluent and politically connected individuals in order to lure wealthy inve the "Ponzi" scheme. 39. Defendant ROTHSTEIN and other co-co i sociated with well known sports 1/4 an biS figures and politicians, in public forums and el i rder to gain greater notoriety d to e create the appearance of wealth and legiti h acts were calculated in part to enhance defendant ROTHSTEIN's ability to s te tal investors in the "Ponzi" scheme. 40. Defendant ROTH d other co-conspirators used funds derived from the "Ponzi" scheme to maintain a ap arance of affluence and wealth, by purchasing expensive real and personal property, der to convince potential investors of the legitimacy of RRA and of the „r, purported inv ant o ortunities. Defendant ROTHSTEIN purchased expensive real property, personal y, usiness interests, vessels, vehicles and other indicia of success and wealth. violation of Title 18, United States Code, Section 1962(d). 13 EFTA00795636 • • Case 0:09-cr-60331-JIC Document 1 Entered on FLSO Docket 12/01/2009 Page 14 of 36 COUNT 2 (Money Laundering Conspiracy, 18 U.S.C. §1956(h)) 1. The General Allegations and paragraphs 5 through 40 of Count 1 of the Information are realleged and incorporated herein by reference. 2. TD Bank, N.A., (hereinafter referred to as TD Bank) was a commercial.bank with branch offices in thirteen (13) states, including a branch office in Weston, Florida1 e utive offices of TD Bank were located in Portland, Maine and Cherry Hill, Ne Defendant ROTHSTEIN and RRA maintained approximately thirty-eight (38) nk a ts at TD Bank, which were utilized during the course of the "Ponzi" scheme. 3. Gibraltar Private Bank and Trust (herei f€ to as Gibraltar Bank) was a commercial bank with seven (7) branch offices, i ranch office in Fort Lauderdale, Florida. Defendant ROTHSTEIN and RRA m* 1/4 least four (4) bank accounts at Gibraltar Bank, which were utilized during the course of thec "Ponzi" scheme. _ - 4. From in or about 2005,and continuing thereafter through in or about November 2009, \ \\;\ in Broward County, in the Soutite \District of Florida and elsewhere, the defendant, /SCOTT W. ROTHSTEIN, 1,1eZNIK did knowingly conspi federate, and agree with persons known and unknown to the United States Atto mmit offenses against the United States in violation of Title 18, United States Code1S 1956 and 1957, that is: i. to knowingly conduct and attempt to conduct financial transactions raffecting interstate and foreign commerce, which involved the proceeds of a specified unlawful activity, that is, mail fraud and wire fraud, in violation of Title 18, United States Code, Sections 1341 and 1343, with the intent to promote the carrying on of said specified unlawful activities, and that while conducting and attempting to conduct such financial transactions knew that the property involved in the financial 14 EFTA00795637 • • , Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 15 of 36 transaction represented the proceeds of some form of unlawful activity in violation of Title 18, United States Code, Section 1956(a)(1)(A)(i); ii. to knowingly conduct and attempt to conduct financial transactions affecting interstate commerce and foreign commerce, which transactions involved the proceeds of specified unlawful activity, that is, mail fraud and wire fraud, in violation of Title 18, United States Code, Sections 1341 and 1343, knowing that the transactions were designed in whole or in part to conceal and disguise the nature, location, source, ownership, and control of the proceeds of specified unlawftil activity, and that while conducting and attempting to conduct such ncial transactions, knew that the property involved in the financial transactions nted the proceeds of some form of unlawful activity, in violation of Title 1 ates Code, Section I 956(a)(1)(B)(i); and iii. to knowingly engage and attempt to engage, in mon itnsactions by, through or to a financial institution, affecting interstate and foreign commerce, in criminally derived property of a value greater than $10; , wIlich property having been derived from a specified unlawful activity, fraud and wire fraud, in violation of Title 18, United States Code, Selo 34 and 1343, in violation of Title 18, United States Code, Section 1957. All in violation of Title 18, United Sta ection I 956(h). (Mail and Wi ud C nspiracy, 18 U.S.C. §1349) 1. The General All d paragraphs 5 through 40 of Count I of the Information are realleged and incorporated herein by reference. 2. From in or about 2005 and continuing thereafter through in or about November 2009, in Broward County, in the Southern District of Florida and elsewhere, the defendant, SCOTT W. ROTHSTEIN, did knowiney combine, conspire, confederate, and agree with other persons known and unknown to the United States Attorney to commit offenses against the United States in violation of Title 18, United States Code, Sections 1341 and 1343, that is: 15 EFTA00795638 • . Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 16 of 36 i. to knowingly and with intent to defraud devise and intend to devise a scheme and artifice to defraud and to obtain money and property from others by means of materially false and fraudulent pretenses, representations, and promises, knowing that they were false and fraudulent when made, and causing to be delivered certain mail matter by any private and commercial interstate carrier, according to the directions thereon, for the purpose of executing the scheme, in violation of Title 18, United States Code, Section 1341 ii. to knowingly and with intent to defraud devise and intend to devise a scheme and artifice to defraud and to obtain money and property from others by means of materially false and fraudulent pretenses, representations, and promises, knowing that they were false and fraudulent when made, and transmitting and causing to be transmitted by means of wire communications in interstate and foreign commerce, certain signs, signals and sounds, for the purpose of executing the scheme, in violation of Title 18, United States Code, Section 1343. THE PURPOSE AND OBJECT OF TH RACY 3. The purpose and object of the conspirac ich defendant ROTHSTEIN and his co-conspirators by illegally obtaining money es rs and converting the investors' money to their own use and benefit through the o non e above-described "Ponzi" scheme. All in violation of Title 18, t Stat s Code, Section 1349. N 4 and 5 Fraud, 18 U.S.C. §1343) ) 1. The General Ahegations and paragraphs 5 through 40 of Count 1 of the Information ed herein by reference. are realleged an inco ( t r 2. about the dates enumerated as to each count below, at Broward and Miami- Dad.e Counties', in the Southern District of Florida, and elsewhere, the defendant, SCOTT W. ROTHSTEIN, did knowingly and with intent to defraud devise and intend to devise a scheme and artifice to defraud and to obtain money and property from others by means of materially false and fraudulent pretenses, 16 EFTA00795639 • , Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 17 of 36 representations, and promises, knowing that such pretenses, representations, and promises were false and fraudulent when made, and for the purpose of executing the scheme, transmitted and caused to be transmitted certain wire communications in interstate and foreign commerce, as more particularly described below: COUNT DATE WIRE COMMUNICATION \\ - 4 December 2, 2008 . , • Interstate wire transfer sent from TD13ank to Gibraltar Bank = - ,, N>, 5 October 16, 2009 Interstate wire transfer sent to TD13ank from JP Morgan Chase All in violation of Title 18, United States Code, Sections 1343 and 2. FORFEITURE ALLEUTIONS 1. The allegations of this Info realleged and by this reference fully incorporated herein for the purpose of all feitures to the United States of America of certain property in which the defendant st pursuant to 7(c)(2) and 32.2(a), Federal Rules of Criminal Procedure. Fork' is g sought pursuant to the provisions of Title 18, United States Code, Sections 1963(a), 983 a)-and 98 I (a)(1)(C), as made applicable hereto by Title 28, United States Code, Section 2. t p conviction of the offense of RICO Conspiracy set forth in Count 1 of the Information, the defendant, SCOTT W. ROTHSTEIN, shall forfeit to the United States the following property: ‘7' i. Any interest acquired or maintained pursuant to Section 1962; ii. Any interest in, security of, claim against, or property or contractual rights of any kind affording a source of influence over, the 17 EFTA00795640 • Case 0:09-ct-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 18 of 36 <41/4 enterprise described in the Information which was established, operated, controlled and conducted pursuant to Title 18, United States Code, Section 1962; and iii. Any property constituting or derived from proceeds obtained directly and indirectly from racketeering activity pursuant to Title 18, ei t 3. Upon conviction of the offense of Money Laundering Cons r forth in Count 2 of the Information, the defendant, SCOTT W. ROTHSTEIN, shall f0itatcli the United States all property, real or personal, involved in or traceable to the off_et1 w h property shall include: United States Code, Section 1962. i. all money and other property subject of each transaction, transportation, t ' art transfer in violation of Section 1956(h); ii. all commissions, clIt yr property constituting proceeds obtained as a result of ns; and iii. all pro in any manner and part to commit and to facilitate the commission of those violations. 4. n conviction of the offense of Conspiracy to Commit Mail Fraud and Wire Fraud and to 't re Fraud as set forth in Counts 3, 4, and 5 of the Information, the defendant, S . OTHSTEIN, shall forfeit to the United States, all property, real or personal, which eons! tes or is derived from proceeds traceable to the offense. 5. The property subject to forfeiture, pursuant to Title 18, United States Code, Sections 1963, 982(a)(1) and 981(a)(1)(C), includes but is not limited to: 18 EFTA00795641 • • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 19 of 36 A. A sum of money equal to $1,200,000,000 in United States currency. B. Real Properties ("RP"): (RP I) 2307 Castilla Isle, Fort Lauderdale, Florida, hereafter also referred to as "Defendant RP1," includes all buildings, improvements, fixtures, attachments and easements found therein or thereon, and is more particularly described as Laudetdale Shores Reamen Plat 15-31 B Lot 2 Blk 5 with a Folio Number of 5042 12;13) 0210; (RP2) 2308 Castilla Isle, Fort Lauderdale, Florida, hereafter also ferred to as "Defendant RP2," includes all buildings, improvements, fixtures, c ems and easements found therein or thereon, and is more particul bed as: Lauderdale Shores Reamen Plat 15-31 B Lot 2 Blk 4 with o ber of 5042 12 13 0020; (RP3) 2316 Castilla Isle, Fort Lauderdal a, ereafter also referred to as "Defendant RP3," includes all building p ems, fixtures, attachments and easements re+ found therein or the d is ifiore particularly described as: Lauderdale Shores Reamen Plat 15- (al1/4 0030; & Lot 4 W % Blk 4 with a Folio Number of 5042 12 13 (RP4) 30 Isla T "a Drive, Fort Lauderdale, Florida, hereafter also referred to as "Defendant hir 4," udes all buildings, improvements, fixtures, attachments and easements bu d therein or thereon, and is more particularly described as: Isla Bahia 47-27 B Lot 63 with a Folio Number of 5042 13 16 0640; 1RP5) 29 Isla Bahia Drive, Fort Lauderdale, Florida, hereafter also referred to as "Defendant RPS," includes all buildings, improvements, fixtures, attachments and easements 19 EFTA00795642 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 20 of 36 found therein or thereon, and is more particularly described as: Isla Bahia 47-27 B Lot 35 with a Folio Number of 5042 13 16 0360; (RP6) 350 SE 2nd Street, Unit 2840, Fort Lauderdale, Florida, hereafter also referred to as "Defendant RP6," includes that portion of the condominium, improvements, fixtures, attachments and easements found therein or thereon, and is more particularly described as: 350 Las Olas Place Condo Unit 2840 with a Folio NUk)er of 5042 10 (-7 \ AN 1490; Cib) (RP8) 2133 Imperial Point Drive, Fort Lauderdale, Florida, h also referred to as "Defendant RP8," includes all buildings, impr easements found therein or thereon, and 'As r Point 1 Sec 53-44 B Lot II Blk 22 fixtures, attachments and icularly described as: Imperial F o Number of 4942 12 07 2020; (RP9) 2627 Castilla Isle, Fort Laud, a e, da, hereafter also referred to as "Defendant '1 RP9," includes all bui improvements, fixtures, attachments and easements found therein or d is more particularly described as: Lauderdale Shores Reamem Plat Lot 22 Blk 5 with a Folio Number of 5042 12 13 0380; (RP10)10630 ? le Street, Apt. 110, Plantation, Florida, hereafter also referred to as T or ' fend t RHO," includes that portion of the condominium/townhome, vements, fixtures, attachments and easements found therein or thereon, and is more particularly described as: OPTIMA VILLAGE 1-"C" CONDO UNIT 201 BLDG 2 with a Folio Number of 4941 31 AC 0110; (RP II) 227 Garden Court, Lauderdale by the Sea, Florida, hereafter also referred to as "Defendant RP11," includes that portion of the buildings, improvements, fixtures, 20 EFTA00795643 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 21 of 36 attachments and easements found therein or thereon, and is more particularly described as: SILVER SHORES UNIT A 28-39 B POR of Lot 4, BLK 5 DESC AS TO BEG AT SE COR SAID LOT 4, N 79.37 W 37.75, S 79.37, E 35.75 TO POB AKA: UNIT E MARINA VILLAGE TOWNHOMES 227GARDEN with a Folio Number of 4943 18 24 0050; (RP12) 708 Spangler Boulevard, Bay I, Hollywood, Florida, hereafter "Defendant RP12," includes all buildings, improvements, ,x ferred to as tachments and easements found therein or thereon, and is more particul d cribed as: HARBOR VIEW 10-5 13 PORTION OF LOTS I & 2 BL C AS COMM 25 S OF NE COR OF LOT 2 ON E/L, W 20.52 ALG F ST RD 84, S 15.72 TO POB, S ov S 7.25, E 12.59, S 24.40, W 29.9 AKA: BAY 1 PORTS1DE l ir (RPI3) 1012 East Broward B ard, as "Defendant and easeme 6 31.74, N 24.00, E 49.07 TO FOB umber of 5042 23 28 0010; rt Lauderdale, Florida, hereafter also referred to ' i des all buildings, improvements, fixtures, attachments therein or thereon, and is more particularly described as: BEVERLY HEIGHTS 1-30 B LOT I W 100, LOT 2 W 100 BLK 17 with a Folio 895 umber a5042 I 1 07 0540; N Federal Highway, Fort Lauderdale, Florida, hereafter also referred to as "Defendant RP I4," includes all buildings, improvements, fixtures, attachments and easements found therein or thereon, and is more particularly described as: 31-48-43 S 150 OD FOL DESC, BEG INTER E R/W/L ST RD 5, N TO POB with a Folio Number of 4843 31 00 0401; 21 EFTA00795644 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 22 of 36 (R1315)350 Las Olas Boulevard, Commercial Unit 2, Fort Lauderdale, Florida, hereafter also referred to as "Defendant RP15," includes all portion of that condominium, improvements, fixtures, attachments and easements found therein or thereon, and is more particularly described as: 350 LAS OLAS PLACE COMM CONDO UNIT CU2 with a Folio Number of 5042 10 AP 0020; (12P16) 361 SE 9 Lane, Boca Raton, Florida hereafter also referred to as Allill nad\ t 16," includes all buildings, improvements, fixtures, attachmen ments found therein or thereon; (RP17) 1198 N Old Dixie Highway, Boca Raton, Fl reafter also referred to as "Defendant RP17," includes all buildin ents, fixtures, attachments and ni v easements found therein or thereo • (RP18) 1299 N Federal Highway, AlSkat n, Florida hereafter also referred to as 41k, "Defendant RP18," inc all b 'dings, improvements, fixtures, attachments and easements found ereon; (RP19) 151 East 58 ment 42D, New York, New York hereafter also referred to as "Defendant RP19," includes all portion of that condominium, improvements, 7 , Attachments and easements found therein or thereon; 11 tuff Hill Cove Farm, Narragansett, Rhode Island hereafter also referred to as `Defendant RP20," includes all buildings, improvements, fixtures, attachments and easements found therein or thereon; 22 EFTA00795645 • Case 0:09-cr-60331-JIC Document 1 Entered on FLED Docket 12/01/2009 Page 23 of 36 (RP21) 15 Bluff Hill Cove Farm, Narragansett, Rhode Island hereafter also referred to as "Defendant RP21," includes all buildings, improvements, fixtures, attachments and easements found therein or thereon; (RP22) 353 4 Ave., Unit 12-H, Brooklyn, NY hereafter also referred to as "Defendant RP22," includes all portion of that condominium, improveme xtures, attachments and easements found therein or thereon; (RP23) 290W 11th St #1C,NY,NY hereafter also referred to as' 3," includes all portion of that condominium, improvements, fixtures a ents and easements found therein or thereon; and 4 (RP24) Versace Mansion/Casa Casuarina-10°/ • hereafter also referred to as o "Defendant RP24," includes all bu , i rovements, fixtures, attachments and easements found therein or C. Vehicles and Vessels ): (VV I) 1990 Red Fe e, VIN: ZFFMN34A5L0087066; (VV2) 2009 White ntl nvertibte, VIN: SCBDR33W29C059672; (VV3) 2008 w McLaren Mercedes Benz SLR, VIN: WDDAK76F98M001788; ll? kiir (VV4 007 B1 Limousine Ford Expedition, VIN: IF I FK I5557LA 59223; jorsp, Red Ferrari 430 Spider, VIN: ZFFEW59A38016301 I; 2007 Silver Rolls Royce Convertible, VIN: SCA I L68557UX23044; Y(VV7) 2006 Silver Hummer HI, VIN: 137PH84396E220665; (VV8) 2008 Cadillac Escalade, VIM 1GYEC63858R234458; (VV9) 1967 Red Convertible Corvette, VIN: 194677SI04745; 23 EFTA00795646 • , Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 24 of 36 (VV 10) 2009 Black Bugatti Veyron EB 16.4, VIN: VF9SA25C28M795153; (VVI 1)2008 Blue Rolls Royce Drophead Convertible, VIN: SCA2D68528UX 16071; (VV17) 2007 87' Warren, Hull # WAR87777B707; (VVI8) 33' Aquariva, Hull # XFA33R74G405; (VV 19) 2009 11' Yamaha Jet Ski, Hull # YAMA36611809; (VV20) 2009 11' Yamaha VS, Hull # YAMA36261809; (VV21) 2009 11' Yamaha VS, Hull #YAMA2679G809; (VV22) 1999 55' Sea Ray 540 Sundancer, SERY001899; co (VV23) 2009 Yamaha Jet Ski, Hull # YAMA4288 (VV 24) 2010 White Lamborghini 1p-670sv, V PU8AHXALA03837. D. Tangibles ("T") (TI) 304 pieces of jewelry, wat ces and earrings seized on or about Monday, November 9, 2009 fr s ence of Scott and Kimberly Rothstein; (T2) 16 DuPont Li on or about Monday, November 9, 2009 from the residence o d Kimberly Rothstein; (T3) 3 pieces spot;ts memorabilia seized on or about Monday, November 9, 2009 from the ( ie idence of Scott and Kimberly Rothstein; S S2 1,160 in United States currency seized on or about Monday, November 9, 2009 from the residence of Scott and Kimberly Rothstein; $1,500 in United States currency, seized on about Wednesday, November 4, 2009, from the office of Scott W. Rothstein at the law firm of Rothstein, Rosenfeldt and Adler, P.A.; 24 EFTA00795647 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 25 of 36 (T6) $30,000 in American Express Gift Cards to the attention of Scott Rothstein, obtained from UPS on or about November 12, 2009; (T7) $50,000 in American Express Gift Cards to the attention of Scott Rothstein, obtained from UPS on or about November 13, 2009; (T8) 5 additional watches being voluntarily turned over to the United States; and (T9) Guitar collection of Scott W. Rothstein, located at the residence of Scott and Kimberley Rothstein, valued between $10,000 and $20,000. E. Bank Accounts ("BA") \iv/ (BA l) Fidelity Investments Stock Account, in the n ft W. Rothstein, valued at approximately $1,263,780; (BA2) Gibraltar Bank account 50010085, 'n* p ximate amount of $484,900.68; (BA3) Gibraltar Bank accoun in approximate amount of $53,448.51; (BA4) Gibraltar Bank account in the approximate amount of $71,793.06; (BA5) Gibraltar Bank at-conga in the approximate amount of $995,521.42; (BA6) Bank account 178780211819923220000187 at Banque Populaire, Morocco, in the name of Scott Rothstein, in the approximate amount of $12,000,000; (BA7) Bank account at Banque Populaire, Morocco, in the name of Ahnick Khalid, up to \\ the amount of $2,000,000; N --(SAS) Bank account at Banque Populaire, Morocco, in the name of Steve Caputi, up to the amount of $1,000,000; 25 EFTA00795648 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 26 of 36 (BA9) Toronto Dominion Bank, N.A. account 6860291266 in the name of Rothstein Rosenfeldt Adler, P.A. which, on or about November 11, 2009, contained the approximate amount of $54,021.27; (BA10)Toronto Dominion Bank, N.A. account 6861011556 in the name of Rothstein Rosenfeldt Adler, P.A. which, on or about November 11, 2009, ned the approximate amount of $10,085.00; dee (M11)Toronto Dominion Bank, N.A. account 6860420923 in of Rothstein Rosenfeldt Adler, P.A, Attorney Trust Account 3, which 2009, contained the approximate amount of $7 (BAI2)Toronto Dominion Bank, N.A. account Holding, which, on or about Nove of $64,970.00; <C (BA13)Toronto Dominion B .A. account 6860755757 the name of RRA Sports and Entertainment ' , on or about November 11, 2009, contained the approximate f $10,490.10; (BA14)Toront- inion Bank, N.A. account 686075578) in the name of RRA Goal Line r <ic image nt, LLC, which, on or about November 11, 2009, contained the OP oximate amount of $25,216.27; ,•—it )Toronto Dominion Bank, N.A. account 6861077714 in the name of Rothstein .7, Rosenfeld! Adler, P.A., which, on or about November 11, 2009, contained the approximate amount of $20,080.00. bout November 11, 26 in the name of DJB Financial 9, contained the approximate amount EFTA00795649 • Case 0:09-cr-60331-J1C Document 1 Entered on FLSD Docket 12/01/2009 Page 27 of 36 F. Business Interests ("BI") (B11) Stock certificates, if issued, or the beneficial interest in such shares, of 50,000 shares of capital stock, in Gibraltar Private Bank & Trust, a federally chartered stock savings association, purchased in or about September 2009 by GBPT, LLC, a Delaware Limited Liability Company, by its manager, Bahia Property IS,agement, LLC, a Delaware Limited Liability Company, by its co-manager, Scott Rothstein; (B12) Scott W. Rothstein's equity interest in QTask; frW.i (313) Scott W. Rothstein's equity interest in Broward Bank erce; (814) Scott W. Rothstein's equity interest in Bova (815) Scott W. Rothstein's equity interest in B (BI6) Scott W. Rothstein's equity intere va nme; (817) Scott W. Rothstein's equity y4rest af6 Iguana, Pembroke Pines, Florida; (BI8) Scott W. Rothstein's e (BI9) Scott W. Rothst interrst in Cart Shield USA, LLC; nterest in Renato Watches; (8110) Scott W. Rot Equity interest in Edify LLC; (B111) Scott W. Rothstein's equity interest in V Georgio Vodka; (B112) ott W. Rothstein's equity interest in Sea Club; ( W. Rothstein's equity interest in North Star Mortgage; \ NIL Scott W. Rothstein's equity interest in Kip Hunter Marketing; O(15) Scott W. Rothstein's equity interest in RRA Sports and Entertainment, LLC; (8116) Scott W. Rothstein's equity interest in Versace Mansion/Casa Casuarina, including 10 year Operating Agreement with 2 ten year options; 27 EFTA00795650 • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 28 of 36 (BI17) Scott W. Rothstein's equity interest, and licensing rights, in Alternative Biofuel Company; (BI18) Scott W. Rothstein's equity interest in RRA Goal Line Management; (8119) Scott W. Rothstein's equity interest in Iron Street Management, LLC; (B120) Scott W. Rothstein's equity interest in, and loan to, Africat Equity IG Decide; (8121) Scott W. Rothstein's equity interest in, and rents derived from 11 LLC; (8122) Scott W. Rothstein's equity interest in, and rents derived fr. ederal LLC; (8123) Promissory Note by Uniglobe in favor of Scott W. Rot (8124) All equity interest held by or on behalf of Se othstein, in the following corporations and entities: a. 29 Bahia LLC; b. 235 GC LLC; c. 350 LOPt/2840 Cl.. * d. 353 BR L • e. 10630 10 ; 1. ?t o .angler LLC; 4 10 Broward LLC; ,---\c 1198 Dixie LLC; 1299 Federal LLC; / j. 2133 IP LLC; k. 15158 LLC; I. AANG LLC; 28 EFTA00795651 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 29 of 36 m. n. o. (1. r. s. t. u. v. w. x. y. z. aa. ab. AAMGI LLC; AAMM Holdings; ABT Investments LLC; Advanced Solutions; Bahia Property Management LLC; Boat Management LLC; BOSM Holdings LLC; BOVA Prime LLC; BOVA Restaurant Group LLC; The BOVA Group LLC; BOVA Smoke LLC; B <S e BOVCU LLC; LLC; Broward F. Idings, Inc.; C107 W i LLC; CN14 CLILC; C127 LLC; + Ilirite. CSU LLC; af. D & D Management & Investment LLC; ag. D & S Management and Investment LLC; ah. DJB Financial Holdings LLC; 29 EFTA00795652 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 30 of 36 ai. DYMMU LLC; aj. Full Circle Fort Lauderdale LLC; ak. Full Circle Trademark Holdings LLC; al. GHW I LLC; am. IDNL GEAH LLC; an. ILK3 LLC; (11. ap. JRCL LLC; ao. IS Management LLC; P aq. Judah LLC; ar. Kendall Sports Bar; 14 C:) as. Kip Hunter Marketing LLO at. NF Servicing LLC; a lect au. NRI 11 LLC; v. NRI 15 E aw. NS Hoicling9L C; ax. PRCHLLC; ay, PK-Adventures LLC; PK's Wild Ride Ltd; ba. Rothstein Family Foundation; bb. RRA Consulting Inc.; bc. RRA Goal Line Management LLC; bd. RRA Sports and Entertainment LLC; 30 EFTA00795653 Case 0:09-cr-60331-JIC Document 1 Entered on FLED Docket 12/01/2009 Page 31 of 36 be. RSA 1l'" Street LLC; bf. RW Collections LLC; bg. S & KEA LLC; bh. Scorh LLC; bi. Tipp LLC; bj. VGS LLC; bk. The Walter Family LLC; bl. Walter Industries LLC; bm. WPBRS LLC; bn. WAWW; bo. WAWW 2 LLC; bp. WAWW 3 LLC; bq. WAWW 4 LLC; br. WAWW 5 • bs. WAW bt. It WW 7 LLC; 7 W 8 LLC; WAWW 9 LLC; \ ' - w. WAWW 10 LLC; bx. WAWW 11 LLC; by. WAWW 12 LLC; bz. WAWW 14 LLC; 31 EFTA00795654 • • Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 32 of 36 ca. cb. cc. cd. ce. cf. cg. ch. ci. WAWW 15 LLC; WAWW 16 LLC; WAWW 17 LLC; WAWW 18 LLC; WAWW 19 LLC; WAWW 20 LLC; WAWW 21 LLC; WAWW 22 LLC; JB Boca M Holdings LLC; and G. Contributions contributions:" CV% A ti ,* hereinafter ti S y referred to as "the defendant (CI) $6,000 in campaign contributions made to Alex Sink and voluntarily offered, and turned over, to the United States on behalf of Alex Sink; (C2) $40,000 in campaigncontributions to Republican Party of Florida, "Florida" account and voluntarily offered, and turned over, to the United States by the Republican Party ic oridat" 1f100 in campaign contributions to Republican Party of Florida, "Federal" account and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; (C4) $90,000 in campaign contributions to Republican Party of Florida and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; 32 EFTA00795655 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 33 of 36 (C5) $5,000 in campaign contributions to Republican Party of Florida by Rothstein business entity known as WAWW and voluntarily offered, and turned over, to the United States by the Republican Party of Florida; (C6) $800,000 Charitable Donation to Joe DiMaggio Children's Hospital, which hospital voluntarily advised the United States of the donation from the Rothstein Family Foundation, for the purpose of facilitating forfeiture; (C7) $1,000,000 Charitable Donation to Holy Cross Hospital, which hospital voluntarily advised the United States of the donation from the Rothstein Fantily Foundation, for the purpose of facilitating forfeiture; (C8) $9,600 in campaign contributions to Gove rist, voluntarily offered, and turned over, to the United States by t> i Charlie Crist; and t, (C9) All funds voluntarily turned o sited States (IRS/FBI), since in or about October 28, 2009, in to S blicity regarding Scott W. Rothstein. 6. If any of the prope above as being subject to forfeiture, as a result of any act and omission of the defe i. cannot be 1 upon the exercise of due diligence; ii. has b trans d or sold to, or deposited with, a third party; ae iii n aced beyond the jurisdiction of the court; n substantially diminished in value; or has h been commingled with other property which cannot be divided without difficulty; it is the intent of the United States, pursuant to Title 18, United States Code, Section 1963(m), and pursuant to Title 21, United States Code, Section 853(p), made applicable hereto by Title 18, United 33 EFTA00795656 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 34 of 36 States Code, Section 982(b), and pursuant to Rule 32.2 Fed. R. Crim. P., to seek forfeiture of any other property of said defendant up to the value of the forfeitable property described above. All pursuant to Title 18, United States Code, Section 1963, Title 18, United States Code, Section 982(a)( I ) and Title 18, United States Code, Section 981(a)(I)(C) made applicable through Title 28, United States Code, Section 2461; and the procedures outlined at Title 21, U tales lakee ven C aS Code, Section 853. JEFFREY . SLOMAN ACTING UNITED STATES ATTORNEY o lvvN-/‘— PAUL F. SCHWARTZ ASSISTANT UNITED STATES ATTORNEY J ETRE N. KAPLAN ASSIS ANT UNITED STATES * A CE D. VECC ASSISTANT UNITED STATES ATTORNEY 34 EFTA00795657 . Case 0:09-cr-60331-JIC Document 1 Entered on PI_SD Docket 12/01/2009 Page 35 of 36 UNITED STATES DISTRICT COuHT SOUTHERN DISTRICT OF FLORIDA UNITED STATES OF AMERICA CASE NO. vs. SCOTT W. ROTHSTEIN Defendant. Superseding Case Information: Court Division: (seed one) Miami ___ Key West _X__ us ___ WPB FTP I do hereby certify that: CERTIFICATE OF TRIAL ATTORNEY* New Defendant(s) Yes _X_ __Igo Number of New Defendants Total number of counts A 4C 1. I have carefully considered the allegations of the indictment, the number of defendants, the number of probable witnesses and the legal complexities of the Indictment/Information attached hereto. 2. I am aware that the information supplied on this statement will be-relied upon by the Judges of this Court in setting their calendars and scheduling criminal trials under the mandate of the Speedy Trial Act, Title 28 U.S.O. Section 3161. 3. Interpreter: (Yes or No) List language and/or dialect 4. This case will take days for the parties to try. 5. Please check appropriate category and type of.offense listed below: ion only enii - riain ereini I 0 to 5 days _X___ Petty II 6 to 10 days Minor III 11 to 20 days Misdem. IV 21 to 60 days Felony V 61 days and over 6. Has this case been previously filed in this District Court? (Yes or No) ..No- —. If yes: Judge: Case No. (Attach copy of dispositive order) Has a complaint been filed in this matter? (Yes or No) Na_ If yes: Magistrate Case No. i Related Miscellaneous numbers: Defendant(s) in federal custody as of Defendant(s) in state custody as of Rule 20 from the District of Is this a pot flat death penalty case? (Yes or No) .hlo-- 7. case originate from a matter pending in the U.S. Attorney's Office prior to (1 1,,2003.> Yes S. No this case originate from a matter pending in the U. S. Attorney's Office prior to 11, 1999? _ Yes 1_ No If yes, was it pending in the Central Region? _ Yes — No Does this case originate from a matter pending in the Northern Region of the U.S. Attorney's Office prior to October 14, 2003? _ Yes X No 10. Does this case originate from a matter pending in the Narcotics Section (Miami) prior to May 18, 2003? _ Yes __X__ No 11. Does this case originate from a matter pending in the Central Region of the U.S. Attorney's Office prior to September 1, 2007 Yes --X_ No Lite T U . LaAL ASSISTA N TED STATES ATTORNEY Florida Bar No. A005500030 V •1•1- - -IA.. 4, 1.. ..... EFTA00795658 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 36 of 36 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA PENALTY SHEET Defendant's Name: SCOTT W. ROTHSTEIN Count fl: I 18 U.S.C. § 1962(d); RICO Conspiracy; • Max.Penalty: 20 years imprisonment, $250,000 fine Count N: 2 18 U.S.C. § 1956(h); Conspiracy to Commit Mo * Max.Penalty: 20 years imprisonment, $500,00 involved in the transaction. A act)? ce the value of the property Count H: 3 18 U.S.C. § 1349; Conspiracyf`Go jt Mail Fraud and Wire Fraud; NI, c at • Max.Penalty: 20 years impri ent, $250,000 fine Counts /I: 4-5 18 U. § y1343; Wire Fraud • Max.Penalty: liti lWars imprisonment, $250,000 fine y to possible term of incarceration, does not include possible fines, restitution, special assesslfients, parole terms, or forfeitures that may be applicable. EFTA00795659 IN THE CIRCUIT COURT OF THE SEVENTEENTH JUDICIAL CIRCUIT IN AND FOR BROWARD COUNTY, FLORIDA COMPLEX BUSINESS DIVISION CASE NO. 09 059301 STUART A. ROSENFELDT, individually, and ROTHSTEIN ROSENFELDT ADLER, P.A., a Florida Professional Service Corporation, Plaintiffs, v. SCOTT W. ROTHSTEIN, individually, Defendant. 49 AMENDED COMPLAINT FOR DISSOLUTION AND FOR EMERGENCY TRANSFER OF CORPORATE POWERS TO STUART A. ROSENFELDT, OR, IN THE ALTERNATIVE, FOR APPOINTMENT OF A CUSTODIAN OR RECEIVER Plaintiffs, Stuart A. Rosenf inAlually, and Rothstein Rosenfeldt Adler, P.A. (sometimes referred to as the " this action against Scott W. Rothstein, and allege as follows: PRELIMINARY STATEMENT It is wi 1\71117 ris and sorrow that the attorneys of Rothstein Rosenfeldt Adler, P.A. have learned . Rothstein, the managing partner and CEO of the firm, has, according to ass rtain investors, allegedly orchestrated a substantial misappropriation of funds from ; I vestor trust accounts that made use of the law firm's name. The investment business created and operated by Mr. Rothstein centered around the sale of interests in structured settlements. Immediate judicial action is being sought to facilitate the investigation and EXHIBIT a COFFEY BURLINGTON OFFICE IN THE GROVE. PENTHOUSE 2699 Sour*. BAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: infoecoffeyburlington.corn www.colleyburlingion.com EFTA00795660 accounting of investor funds and to address the ongoing affairs of the firm in an appropriate manner through the transfer of all corporate powers to Stuart A. Rosenfeldt. Mr. Rosenfeldt, as the firm's President and only other equity holder in the firm besides Mr. Rothstein, is uniquely positioned to wind down the affairs of the firm, to account for all funds in the firm's trust accounts, and, most importantly, to protect the interests of the firm's clients. In the alt ative, Plaintiffs request that the Court appoint Mr. Rosenfeldt as custodian of the firm g I dissolution or appoint a receiver. In the event that the Court appoints a rec iv I is no necessity for the receiver to assume any control of the firm's law pra se the dedicated attorneys and staff are continuing to assure that the interests ofiltefirm's clients will remain paramount and will be fully protected. \ r Mr. Rosenfeldt and the firm have filed this action,minimize any further damage caused by Mr. Rothstein, to emphasize that the inno tt and staff of the firm are not implicated in this controversy, and, most t y, to protect the best interests of their clients. OF ACTION 1. This is an ac cial dissolution of the firm and an accounting pursuant to Florida Statutes Section 60 3). Additionally, Plaintiffs seek transfer of all corporate powers to Plaintiff Rom dt, or, in the alternative, the appointment of Plaintiff Rosenfeldt as custodian of or the appointment of a receiver, pursuant to Florida Statutes Sections 607.193 17.1432. Plaintiff Rosenfeldt is the firm's president. He has the inherent authority to initiate this emergency litigation. 3. Defendant Rothstein is the firm's managing partner and CEO. Rothstein, a charismatic and talented lawyer, has controlled firm management, especially financial matters, 2 COFFEY BURLINGTON OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BATSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.853.5261 Email: infoeeoffeyburlington.com www.coffeyburlington.com EFTA00795661 and has not extended access to core financial matters and records to any other attorney at the firm. 4. Plaintiff Rosenfeldt and Defendant Rothstein are the sole owners of the equity in the firm. 5. The firm's principal office is located at 401 East Las Olas Blvd, Suite 1650, Fort Lauderdale, FL 33301. 6. Venue properly lies with this Court because the firm's prin Broward County. L BACKGROUND AND GROUNDS FOR DISSOLU ION The Firm 8; i t ir illi4e d Defendant Rothstein in 2002. liisd 8. The firm's practice was origi on labor and employment law, but the firm grew rapidly and its practice areas e to include intellectual property, corporate law, mergers and acquisitions, real es defense, class actions, mass torts and personal injury claims, among others 9. The firm as seven offices, with locations in Florida, New York, and ,P6 Venezuela, and emplo r 70 lawyers. 10. firm Z has an outstanding group of attorneys, staff members, including distin rmer judges, many of whom have statewide, even national reputations, for 1 excellence. 7. The firm was founded by Plaintiff The Settlement Funding Scheme 11. Firm lawyers learned in the past few days about irregularities surrounding a settlement funding business operated by Rothstein. The settlement funding business involved 3 COFFEY BURLINGTON Ol•FICE IN THE GROVE, PENTHOUSE 2699 SOUTH SAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: infoecorfeyburlington.com www.coffeyburlington.com EFTA00795662 the purchase of structured legal settlements and the sale of these settlements to investors. Various investors have informed the firm that they believe that substantial funds are not properly accounted for and are missing. A review of the firm's records undertaken over this past weekend indicates that various funds unrelated to the direct practice of law cannot be accounted for, circumstances suggesting that investor money may have been misused by Rothstein who, \ controlled all such accounts. Some investors allege that Defendant Rothstein may have beet) fabricating non-existent structured legal settlements for sale to investors. 12. Defendant Rothstein's allegedly improper activities w do thout any knowledge of the other attorneys at the firm, and, in fact, Roth ctivey endeavored to hide the existence of the scheme. It was not until several days ago thatyfaintiff Rosenfeldt or any of \\,/ the other lawyers at the firm discovered some of the.catuinstonces conceming Defendant Rothstein's actions and the alleged impropri KC' etiek\ v M' 13. The firm's attorneys still hava" tex tre ely limited knowledge concerning the ' \) L_ allegations, and yet, recognize the pOrtwe of proceeding expeditiously to undercover the \\> truth. Thus, the emergency 11 corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency a istiment of Plaintiff Rosenfeldt as the firm's custodian or the appointment of a rece critical to undertake at least a preliminary inquiry concerning Defendant R in's conduct, and to make appropriate recommendations to the Court \/ conceinaig any further investigation. Misuse of the Investor Trust Accounts y 14. With respect to the settlement funding scenario, Plaintiffs only recently discovered troubling information concerning Defendant Rothstein's investor trust accounts and details surrounding the transactions are still emerging. However, it appears that Defendant 4 COFFEY B URLINGTON OFFICE IN THE GROVE. PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI. FI.O/tIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: infoecoffeyburlinglon.com www.coffeyburlingion.com EFTA00795663 Rothstein may have transferred substantial sums out of the investor trust accounts, and that the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency appointment of Plaintiff Rosenfeldt as the firm's custodian or the appointment of a receiver, is necessary to account for and, if appropriate, consider taking action to recover the missing investor trust account funds. Shareholder Deadlock 15. Defendant Rothstein has declined to resign despite the asse stantial irregularities because he purports to hold a 50% share of the law firm Fort Yeason, among others, there is a substantial shareholder deadlock, making ma ent of the firm as it currently 4c, stands impossible. COUN ISS 16. Plaintiffs adopt, incorporat nd = ge paragraphs 1-15. 17. Under Florida Statute 1430 a circuit court may dissolve a corporation in a proceeding by a shareholder if /1/4 pia ment of corporate affairs is deadlocked and irreparable injury to the corporation is jhreawied or being suffered. Additionally, a circuit court may dissolve a corporation-Laving 35 or fewer shareholders if a sufficient showing is made with respect to im r or irregular conduct that materially injures the corporation. 1)icer div firm. O Fo the reasons stated herein, Plaintiffs have demonstrated these two grounds for WHEREFORE, Plaintiffs demand judgment of dissolution and all other such remedies that the Court finds appropriate. 5 COFFEY B UR L I N GTON OFFICE. IN THE DROVE. PENITIOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI. FLORIDA 33 133 T: 305.858.2900 F: 305.858.5261 Email: infoecotteyburlington.com www.coffeyburlington.com EFTA00795664 COUNT H (TRANSFER OF CORPORATE POWER TO PLAINTIFF ROSENFELDTI 19. Plaintiffs adopt, incorporate, and reallege paragraphs 1-18. 20. Florida Statute 607.1431(3) permits a court in dissolution proceedings to take any action required to preserve the corporate assets wherever located, and carry on the business of A 21. For the reasons stated herein, Plaintiffs submit that the Court's ex e of this the corporation. discretionary power is appropriate to transfer all corporate power over fiar,,, laintiff Rosenfeldt to effect the dissolution request in Count I, to perform an akaligtding of the firm's assets and liabilities, to undertake all actions necessary to un extent of Defendant Rothstein's activities, to wind down the firm's client eta: iTy .. , to appoint a chief restructuring officer and an inventory attorney p A federal bankruptcy proceedings or other rely benefits of creditors, and to undertake ch o k er actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs dttattd t the Court transfer all corporate power over the firm to Plaintiff Rosenfeldt. Ii(zior to orida Bar Rule 1-3.8, to institute proceedings, to file assignments for the LI COUNT HI APPOINTMENT (IN THE ALTERNATIVE, OF NTIFF ROSENFELDT AS CUSTODIAN OF THE FIRM) aintiffs adopt, incorporate, and reallege paragraphs 1-18. 3. Florida Statutes 607.1431(3) and 607.1432 permit a circuit court in a judicial dissolution to appoint a custodian to manage the business and affairs of the dissolving corporation. 6 COFFEY B U R LI NGTON OFFICE. In THE GROVE, PENTHOUSE 2699 Sount BAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: [email protected] www.coffeyburlingion.com EFTA00795665 24. For the reasons stated herein, Plaintiffs request, in the alternative to Counts H and IV, that the Court appoint Plaintiff Rosenfeldt, the President of the firm and sole shareholder besides Defendant Rothstein, as custodian of the Firm to effect the dissolution requested in Count I, to perform an accounting of the firm's assets and liabilities, to undertake all actions necessary to uncover the extent of Defendant Rothstein's activities, to wind down the fi" 's officer i s n client engagements, to appoint a chief restructuring and an inventory atto pu t to Florida Bar Rule 1-3.8, to institute federal bankruptcy proceedings or other r aw proceedings, to file assignments for the benefits of creditors, and to and uch other actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs demand, in the alternative, that o ppoint COUNT (IN THE ALTERNATIVE, APPOIN T OF A RECEIVERI 25. Plaintiffs adopt, incorporate, and reallege paragraphs 1-18. 26. Florida Statutes 607.1431(3) and 607.1432 permit a circuit court in a judicial 7 - \- K---7 dissolution to appoint a receiver toSi,nd up and liquidate the business and affairs of the .,--\ \ dissolving corporation. 1, N. 27. For th sons stated herein, Plaintiffs request, in the alternative to Counts II and eTrir III, that the Co ppo. t a receiver to effect the dissolution requested in Count I, perform an accounti 's assets and liabilities, undertake all actions necessary to uncover the x dant Rothstein's activities, and to undertake all such other actions as may be neces and appropriate under law. 7 COFFEY B UR LI NG TON OF)ICE IN THE GROVE, PENTHOUSE. 2699 SOUTH BAYSHORE DRIVE MIAMI, FLORIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: infoacciffeyburlingion.com www.coffeyburlington.com EFTA00795666 CONCLUSION 28. Defendant Rothstein's conduct in connection with the settlement funding and the investor trust accounts appears at this point to be extensive. Dissolution and the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, in the alternative, the emergency appointment of Plaintiff Rosenfeldt as the firm's custodian or the appointment of recei r, are IL critical to uncover the full extent of Defendant Rothstein's activities, to conside app riate action to recover missing proceeds, to protect the firm's clients, and to pme r t and review the firm's accounts and financial records.' Dated this 3rd day of November, 2009. i p S e ectfully submitted, Cy, COFFEY BURLINGTON Counsel for Plaintiffs 2699 South Bayshore Drive, Penthouse Miami, Florida 33133 (305) 858-2900 KENDALL OFFEY Florida Bar N . 259861 [email protected] Annexed hereto as Exhibit A is an affidavit from Plaintiff Rosenfeldt attesting to the truthfulness of the allegations contained herein. 8 COFFEY B URLINGTON OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.853.5261 Email: [email protected] www.coffeyburlington.com EFTA00795667 CERTIFICATE OF SERVICE I certify that on this 3rd day of November, 2009, with the agreement and consent of Defendant Scott W. Rothstein's counsel, Mark Nurik, Esq., a true and correct copy of the above and foregoing was served via email on Mr. Nurik, at [email protected]. This 3rd day of November, 2009. 'Si Fla LA M. Baia.i 9 COFFEY B URLINGTON OFFICE IN THE. GROVE, PENTHOUSE 2699 SOU I H BAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.358.2900 F: 305.858.5261 Email: infoecoffeyburlington.com www.coffeyburlinglon.com EFTA00795668 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. UNDER SEAL -CI Y.MABBA EDWARD MORSE and CAROL MORSE, INC. WW2 ICON BY JAN JONES, Defendant. o q" vs. JAN JONES INTERNATIONAL, 44C, ORDER ON PLAINTIFFS' ORE T MOTION TO SEIZE FURTHER ASSETS AND RQR OT ER RELIEF This cause came before the Court at hearing on March 17. 18, 19 & 20 2009, upon (collectively .,.. / Plaintiffs', EDWARD MORSE and CAROL (collectively "MORSE"), ore /gnus 4 6se Motion to Seize Further Assets and ore and quent written motions for other relief. The Court has carefully considered merit of counsel, considered the evidence and witnesses presented at the hear. send g otherwise fully advised in the premises; The COURT FINDS AND ORDE2S FOLLOWS: I. Defendant, JAN JO*S'INTERNATIONAL, INC. a/k/a ICON BY JAN JONES and any and all other les and/or other entities owned or controlled by JONES ("JONES"), c for compensatory damages to MORSE in an amount in excess of 00.00: at JONES is liable to MORSE for punitive damages for fraud, in the amount of .... 21,000,000.00 modified from prior order of this court finding liability of 53,000.000.00 in punitive damages; Page I of 6 EXHIBIT EFTA00795669 3. The Court specifically finds that JONES' flagrant fraudulent activity as demonstrated by clear and convincing evidence by counsel for Morse provides sufficient legal basis for an award of such punitive damages. The record on this matter shall be scaled but the record upon which this Court has relied shall be attached hereto for appellate purposes; 4. That there is currently in excess of SI0,000,000.00 of funds clearly belonging frozen in various banks in South Florida pursuant to prior orders of this an s; 5. That these funds arc not to be moved under any circumstances a r of this Court. That movement of these funds shall be punishable by civil nal penalties: 6. That these funds are specifically being held, pursuant t 's Court, to fund the award of damages to MORSE; 7. That these courts have jurisdiction to order s ACS, 8. That in addition to the funds set fo convincing evidence presented by or MORSE and counsel's expert witnesses, JONES has illegally mos, m the United States to the Cayman Islands in violation of federal la se of secreting these assets; 9. That the IRS has vi competent testimony in this regard clearly establishing ownership cif these funds by JONES and clearly establishing a partial right of entitlement by t -IRS to Oponiun of these funds. Such liability shall be less than 55.000,000.00; 4 above, based upon clear and 10 tE1 curt has jurisdiction over said assets as they originated in the United States; a+ the treaties between the United States and the Cayman Islands and related governments clearly establishes the right of the United States to seize such assets. That counsel for MORSE has facilitated the contact between the relative governments and as a Page 2 of 6 EFTA00795670 result,. this Court has received clear and convincing evidence that such funds will be immediately transferred to the United Stales: 12. That the Clerk of Court is hereby directed to immediately submit the proper A documentation to the appropriate bank of the Cayman Islands to facilitate inuttedia transfer of these funds. That any issue arising from such transfer shall be i tely reported to this Court; 13. That the evidence presented by counsel for JONES was inadoo me the findings made by this court based upon the evidence presented by for MORSE. That counsel for JONES is hereby is found to have act macious disregard for prior orders of this and other courts and thus, is f contempt thereof. Further rude/ regarding same shall follow the evidcg a in this regard to be set by this Court; 14. That MORSE shun be entitled t .rd of any monies collected front counsel for JONES pursuant to said co , if monies arc assessed: IS. That this Court has r freezing said assets and has the authority to do so; t o le 16. That JONES' con l's ments that this Court lacks such jurisdiction is without merit and frivoh • 17. Tha, presentation of such evidence by counsel for JONES demonstrates a lack of a basis to prevent same in violation of Federal Rule of Civil Procedure, 11: MORSE has demonstrated by clear and convincing evidence, ownership of these + funds by JONES, that said funds are hereby frozen and not subject to any activity by JONES or any agent of JONES whether situated here or in the United States: Page 3 of 6 EFTA00795671 IS. That these funds shall be frozen for the purpose of satisfying the judgment of this Court against JONES and in MORSE'S favor; 20. That MORSE shall he required to deposit to their attorney's trust account the sum of $15,000,000 00 no later than 10:00 a.m. tomorrow morning, the 20th day of March, 2 ' A lit \ to secure JONES in the event of an illegal seizure of said funds. If such funds t It orxd so posted, this order shall be null and void in its entirety and the according to further order of this Cowl; 21. That counsel for MORSE shall appear before this Court and testify, oath. as to his receipt of these funds, under penalty of perjury and subj cu by the Florida Bar; 22. That based upon argument and representations of tinsel, made under oath, MORSE is suffering from significant financial ckstre dire to the economy and that such a posting could cause severe and irreparable harm to MORSE; thus, as swiftly as possible, in a manner that does not interfere with the mission of the federal agencies now herewith involved, howev agencies now involve C full and unfettered cooperation of the federal tier, following the posting by Morse of $15,000,000.00 .zure associated with the iof the funds located in the Caymans. all other bond wnounrs shall be rettned to MORSE as follows. 515,000,000.00 previously posted by MORSE, S4.1 ;957.00,, ',previously posted by MORSE, and the $18,500,000.00 posted in two a t, stings by MORSE. MORSE's counsel shall act as liason between his clients e federal agencies to expedite return of the funds. Should there be any unnecessary delay in such return of funds, Counsel for MORSE shall appear before this Court on an emergency basis to seek whatever assistance is required, and such assistance shall nut be unreasonably withheld. The Clerk of the Courts is ordered to take all steps necessary to Page 4 of 6 EFTA00795672 assist counsel in expediting return of the funds to MORSE in a timely and expedited fashion; 23. Further, within three (3) business days of the Clerk's receipt of said funds herewith being transferred from the Cayman Islands in compliance with this order, said amount being', approximately 520,000,000.00, shall notify this Court of same so that this Court can issue an order as to the division of said funds. Within five (5) business days of such order dividing same, that portion belonging to MORSE shall be deliveted-to them via their counsel; 24. The Court finds that JONES has waived its right to order of' interest and penalties based upon the doctrine of fraud in the i e court finds that JONES is not entitled to equitable relief of any kind u fact the doctrine that he who seeks equity must do equity. JO hands and thus can not recover anything from MORSE: 25. That this Court has jurist!' Court currently hearing the matter known as MI2NER, referred t un record by number and hereafter referred to as MILNER: 26. That this Cott orders the Court below (MILNER) to release any and all bond funds held pun t o prior order of that court within duce (3) business days of the entry of this <s ten r. sel for MORSE shall facilitate same and insure that same occurs. Should ÷ c5 be a delay, counsel for MORSE shall appear before this Court on an emergency basis and seek whatever assistance is needed to achieve the established objectives; O 27. Counsel for the parties are instructed co insure that all deadlines in this Order arc satisfied in a timely fashion, subject to further order of this Court; Page 5 016 EFTA00795673 28. That both the Federal Court of the Southern District of Florida and this Court have concurrent jurisdiction over these matters and same may be enforced in either venue; and 29. That pursuant to the Bank Secrecy Act as amended on October 21, 2008, The Freedom of A Information Act, The United States Patriot Act II, The Currency and Foreign fransac 'on Reporting Act of 1970 as amended on November 11, 2006, USC 5311-5300 SA Patriot An, Title Ill and the judgment of this Court based upon in ed I under oath, this Order, the facts of and amounts contained herein, th in C i "'eof, and any and all other matters surrounding same shall be held in strict co ?e so as not to jeopardize any potential investigation by the app mmental agencies. Violation of this portion of this order shall result in , v ' - 'nal penalties. DONE AM) ORDERED in Chambers at West PeJ eh aim Beach County, Florida this 25th day of March , 2009. Copies to: All counsel of record IRS, Plantation Officfror FBI, Miami Office . A. RA 4,) United Stec D R istrictludge Page 6 of 6 EFTA00795674 UNITED STATES DISTRICT' COURT SOUTHERN DISTRICT OF FLORIDA Case No. UNDER SEAL -CIV•NI.A.RRA EDWARD MORSE and CAROL MORSE, Plaintiffs, vs. JAN JONES INTERNATIONAL, INC. aik/a ICON BY JAN JONES. C e liCf STIPULATED CONFIDENTIALITY EC Defendant. C) / i ii:i I. On March 24, 2009, this Court entered a detailed r r regard to its Final Findings ‘g in this maser ("Final Order"). As a direct result of the nature of a an i mount of the evidence presented to this Court prior to the Court ente ' Order, and as a result of the contents of that + Final Order, this Court h a etennination that the Final Order itself as well as the be sealed and shall remain confidential, in perpetuity, unless otherwise orde by this Court or another court of competent jurisdiction as detaile ' this o fidentialiry Order. t. rti to this matter, including all witnesses thereto, are hereby bound by this CI + entiality Order. 4. Any failure to comply lkitli this Confidentiality Order by any party or witness shall result in severe consequences. including. without limitation, civil and criminal penalties. evidence leading t Page I or I -; EFTA00795675 5 An:s breach or thts Confidentiality Order must be reported to the Court, immediately by the discovering party. Failure to so report same shall result in severe consequences, including, without limitation. civil and criminal penalties. 6. The Final Order of this court dated March 24. 2009 shall be made a pan hereof, and shall be incorporated by reference herein. ust 7. failure Any to comply with this Confidentiality Order or Final Order, m po d to this court, under seal, and such non compliance shall result in severe noes to the breaching party. 8. All information relating this Court's Final Order to which is made available to any party is re S y party is given access or referred to as "Confidential Information." Confidential Information s u , without limitation, all methods and \ research reports, investigati rts <4c, systems used in this case, names a YeSses of customers, technical memoranda, analyses of any part of this case, all data, documents, and techno c~lFacts, depositions, notes of depositions, clients notes, clients diaries, lav no court notes, court orders preceding this order, pleading, all discovery, a 311 or other electronic communications between any and all parties. witne s, lawyers, and/or other participating in any way in this matter, proprietary u , historical and projected financial information, acts of fraud, information INThi g to transfer of funds fraudulent or otherwise. posting of bonds. return of bonds, attorneys fees. operating data and organizational structures. now or hereafter existing or previously developed or acquired. regardless of whether any such information. data or documents qualify as "trade secrets" under applicable law any and all other information related to this or any other related matter (collectively. the "Confidential Information') Page 2 of i 5 EFTA00795676 Because the secrecy of the Confiderthat Information is critical to this court and its further proceedings which shall also remain confidential until brought public, the parties and witnesses hereto acknowledge and agree that the Confidential Information shall, at all times, be kept in strict confidence by the party and/or witness and same shall not, directly or indirectly, during or after the entry of this order and its execution, except as required by law, with the prior written consent of this court, (a) disclose to any pe entity any Confidential Information without the express written consent of which may be withheld in its sole discretion, or (b) use any Confidential I for the parties i si) own benefit or any other purposes, for the benefit or purpos any other person or entity or in any manner, whatsoever. If the party S criminal legal proceeding, regulatory proceeti ' similar process to disclose any 4 part of the Confidential Information, s s all give prompt notice of such request to the Court and the Court shall an er as it deems appropriate. Nothing shall be disclosed without same. 9. All Confidential Inf. and other materia l istifIr knowledge o , at all times, be kept in strict confidence by the party. is required in any civil or chiding, without limitation, all copies of all documents h the panics have received or reviewed or otherwise have 10. The have been advised and fully understand the heightened confidentiality ments relative to this matter. including. among other things, the legal obligations +T o lawyers to maintain their confidentiality obligations to clients and the parties legal obligation to maintain the confidentiality set forth in this order. Clients are restricted from discussing this metier with any individual or entity other than their respective counsel of record in this matter. The parties have indicated that they . as a result of this action. hate Rsge 3 of I EFTA00795677 access to certain Confidential Information as defined herein. By execution of this order, the parties recognize, acknowledge and confirm their understanding of the confidential nature of the Confidential Information and the damage that would result if any of the Confidential Information is disclosed to any Person and the parties understand their obligation to this court and the fact that this court has jurisdiction over t upon execution of this document by their consent thereto. 11. Further, because disclosure of any Confidential Information as • I ein would result in severe damage as contemplated by this Court, w be difficult to quantify, the parties agree that liquidated damages be a reasonable basis to calculate civil damages caused by a breach and s of $1,000,000.00 per each i incident of disclosure of Confidential Inca n by the parties and/or their representatives is agreed to under th n attialiiry Order. Such liquidated damages shall not prevent this Court from additional damages and from moving forward in a criminal proceeding any so breaching this Confidentiality Order. C I' Each party hereby and warrants that they are not bound by the terms of a confidentiality afire t or other agreement with any third party that would conflict with any of t es' obligations under this Confidentiality Order. 13. Th s stipulate that this Stipulated Confidentiality Order is intended to strictly limit + a event disclosure of information and production of documents compromising the onfidential Information set forth herein and in the Final Order dated March 24 2009. 14. It is further acknowledged that cacti party may be held responsible for any failure on his or her part to comply with the provisions of the Confidentiality Order, and agrees to Pace 4 of I5 EFTA00795678 cdbject himself or herself to the jurisdiction of this court for the purpose of enforcing this Confidentiality Order. IS. The restrictions set forth in this Confidentiality Order shall apply to any and all documents or other information, whatsoever, designated as "CONFIDENTIAL" by this Court. All information shall be deemed confidential and the parties agree t exercise extreme discretion in protecting same. The Court hereby warns all partie to rr on the side of protecting such data. Violation of this order will be mediately and subject the violator to severe sanctions and penalties. and. their 16. This Agreement shall be binding upon the parties respective agents, c, successors and assigns, and inure to the ben of parties and their respective successors and assigns. warrant to each other tha have full power an 17. The parties d authority to execute i ‘l this Agreement for and on b a themselves and/or their respective companies. Parties. as used herein, all persons executing this document as well as their representatives, at gns. 13. Each party placing signature hereon makes the following attestation: I c rat!: knowledge, under penalty of perjury, that I have received a copy of the ed Confidentiality Order (the "Confidentialiry Order") which governs the oduction and use of confidential documents and information produced by the Parties (as defined in the Order) or third parties in this case. I have read and understand the Order and I hereby acknou ledge that I am bound by it and agree to abide by it I ftirther understand that information designated as "CONFIDENTIAL" in this case. and any notes. inemoranda or other form of information derived from it. Page 5 of I5 EFTA00795679 tray nor be used. copied or disclosed by me to anyone else except in strict accordance with the order and then only for the prosecution and defense of this litigation upon proper court order. 'SIGNATURES ON FOLLOwING PAGES) C aS 4 49 Par 6 of i EFTA00795680 . ; 4 7.—re‘l4(111 .4; / 41-1-v • - • EDWARD!. MORSE STATE kaElY-217-1-- COUNTY ) BEFORE ME, the undersigned authority, personally appeared EDWARD J. MORSE o, after being duly sworn according to law, deposes and says that he has read the foregoing docu and It is ...1 true and correct under penalty of perjury. SWORN AND SUBSCRIBED before me nig? 7 day of/it-e-f--d. 20° ) (Si:curare of .Notary P P IPdnL Type. or Sum C kind wameef volant Par DOLORES OAOUST Notary Put le - SW* of Ftoddi kly Commotion (*roe 024.2012 C0nTrilg0il a 00 76803 .3.P.,;;7,,..,t,•'‘ Band Traits Plea Nary Ann- < + COIMISSION NUMBERJEXPIILATIONSEAL Pout 7 of 15 EFTA00795681 1 United States Court of Appeals, Eleventh Circuit. Under Seal-Civ-Marra. EDWARD MORSE and CAROL MORSE, Plaintiffs-Appellants, V. 4 c e JAN JONES INTERNATIONAL, INC. a/k/a ICON BY JAN JONES, Defendant-Appi in re EDWARD MORSE and CAROL MORSE, Petitioners. O C. Appeal from the United States District Court for the Southern District of Fl In der Seal- Civ-Marra), Kenneth A. Marra, Judge. PETITIONERS' MOTION FOR EMERGENCY WRIT OF MANDAMUS Petitioners, EDWARD MORSE and CAROL MORSE, by and through their undersigned counsel, file this, their Motion for Emergency Writ of Mandamus and would state as follows: 1. This matter is before this Honorable Court on an Emergency Writ of Mandamus. 2. This matter and the entire file below have been presented to the court as SEALED pursuant to prior order of the Court bklow.\ (1.- )"./ 3. This nutter is pen4t, Ifore the Honorable United States District Court Judge, Kenneth Marra. 4. On 411k 25, 009 and on April 23, 2009, Judge Marra entered detailed orders 0 in this matter of hich are attached hereto and incorporated by reference herein. t forth in the Orders, Judge Mama ordered that certain specific acts take place on c2ttain specific dates. Many of these acts involved return of a large sum of money to the Plaintiffs. 1 ROTHSTEIN HOSENFIZOT ADLEFt Las OW City Centre, 401E. Las Ohs Roulccird, Suite 1650, Fon Lauderdale, Florida 33301 EFTA00795682 6. Upon receipt of the orders, the undersigned began to put into place all actions necessary to timely comply witivsaid orders. 7. In hearings held subsequent to the entry of these orders, it became abundantly clear to the undersigned that Judge Marra was in some way uncomfortable with his orders and was either staying the orders or reversing his prior decisions by vacating the orders. jc 8. However, despite continuous inquiry by the undersigned, counsel was una determine what Judge Marra intended to do and how he intended to proceed. Elk 9. A thorough review of the record below which is available to this Court under seal clearly indicates that the undersigned, as counsel for the plaintiff h ficant basis for concern based upon comments and ore tenus rulings made by Judge e court below. fore this court, when 10. Most importantly, as can be seen by the sealed the undersigned specifically inquired of the Court w r S3 he was permitted to move forward with the orders entered on March 25th li 2 , the courts responses to the undersigned are non-descriptive and compleitel t guidance at best. 11. When the undersigned the court whether the orders were s acated, reversed or in filll force and effect, the court clearly replied that the court es it bad made itself clear. 12. Not undersigned d the court below further and specifically asked to violate a court order of a respected district court judge, the the only course of conduct remaining in order to protect his clients' rights w rtznergency Writ of Mandamus with this court. 13. It is the position of the Plaintiffs that they have a clear and unwavering legal right to the relief awarded them in the courts orders as set forth herein. 2 ROTHSTEIN ROSENFELOT &Di IS las Olas Qty Centre, 401E. Las Olas Bookvord. Suite rein, Fon lauderdak, Florida 33301 EFTA00795683 Plaintiffs have a clear legal right to the relief specifically set forth in the orders in 14. Moreover, it is without doubt that the undersigned had every right to be concerned _ . with the ore tenus rulings of the court below which post dated the orders in question. 15. As an officer of the court, the undersigned has a direct responsibility to zealously protect the rights of his client. And, as an officer of the court, the undersigned has a direct A responsibility to fully and completely obey the orders of court and when, he is given reason 41 doubt the efficacy of subsequent orders of court that appear to taint the order in qu 0 attempt to ascertain the validity of said order. That is exactly what the undersigned a ne here. I cc , k, 16. Upon determining that the validity of the orders in were in doubt, and upon determining that he could not proceed without further a higher court, this Emergency Writ was filed. A 17. question. 18. The court below had an igdlisJtable duty to act but failed to do so and failed to given the undersigned any guidan 19. At this stage in th rdings, the Plaintiffs have no other remedy at law other f t` t r. than this Writ. 20. If writ ' not entered in Plaintiffs favor, the Plaintiffs will suffer unfair eN e prejudice as ma o aw. Dated_ 7 3 ROTHSTEIN ROSF-N FILM' !WWI Las Olas City Centre, 401E. Las Ohs Beaten/el, Suite 1650. Fon Lauderdale. Honda 33301 EFTA00795684 Respectfully submitted, ROTHSTEIN ROSENFELDT ADLER Counsel for Petitioners Las Olas City Centre 401 E. Las Olas Boulevard Suite 1650 Fort Lauderdale, Florida 33301 Tel: (954) 522.3436 Fax: (954) 527-8663 Email: s By: . Rothstein, Esq. Florida Bar No • 7 - 80 FOR THE F 4 ROTHSTEIN ROSE!~ ADLER las Olas City Caere. dOLE Las Olas Boulevard, Suiic 1650. Fort Lauderdale, Florid+ 33301 EFTA00795685 Before Susan H. Black, Circuit Judge: United States Court of Appeals, Eleventh Circuit. Under Seal-Civ-Marra. EDWARD MORSE and CAROL MORSE, Plaintiffs-Appellants, v. JAN JONES INTERNATIONAL, NC. a/k/a ICON BY JAN JONES, Defendant. Appellee. In re EDWARD MORSE and CAROL MORSE, Petitioners. August 13, 2009. Appeal from the United States District Court for the Southern Dis orida (Under Seal-Civ-Marra), Kenneth A. Marra, Judge. On Petition for Writ of Man ORDER ON EMEERGEN VIRIFOF MANDAMUS Having reviewed the sealed provided by the Clerk of the Court below (Judge Marra), and having he t of counsel in closed proceedings to maintain the integrity of the con tiality order issued in this matter by the Court below, as well as having heard directly fr udge Marra and Judge Gerber, we find as follows: Findinos of Fact —The Court below entered orders on March 25, 2009 and April 23, 2009, specifyi. e that certain specific acts were to take place on certain specific dates. Many of these actions involved return of funds rightfiilly belonging to the Plaintiffs. EFTA00795686 2. Subsequent to the entry of same, Judge Marra, despite his rulings to the contrary, made multiple ore tenus rulings on the record which gave counsel for Plaintiff clear room for pause in following said orders. 3. In multiple subsequent hearings. Plaintiffs counsel clearly attempted to ascertain whether the orders stood as entered or whether they had been reversed or stayed. Based upon our full and complete review of the record it became clear that Marra bad no intention of proceeding as he previously ordered and was either or staying his prior orders as set forth above. Whichever his intention is no to decide. We simply review this matter as it is presented to us, tow' I orders were d entered and then vacated or stayed for no clear and convi rand without a stated basis in law or fact. We make no finding whethe e a was correct in his conclusion, but simply that the record lacked the ess and completeness that is mandated when reversing orders of this ma 4. Thus, we find that co tiff properly and timely filed a sealed Emergency Writ of Mandamus urt in an attempt to properly protect his clients rights under the order.L,I Conclusions of Law Co t. ' Co has jurisdiction over this matter pursuant to the laws <S o control ' is andamus luig:S u . s matter is properly before this court The findings of Judge Marra in the court below, in the orders dated March 2$ and Apt'l 23, 2009, are well based in fact and law. EFTA00795687 • 4. The subsequent ore tenus rulings of Judge Marra are without basis in law or fact. 5. The subsequent ore tenus rulings by Judge Marra fail to provide a sufficient record, as mandated by the rules of court, to allow this court to enter a ruling as to whether Judge Maria had the legal right to stay or reverse his poor order. 6. Plaintiffs writ of mandamus is legally sufficient to allow this court rule in full on all matters pending before it. Thus, we as a Court with jurisdiction over this matter find as follows: 7. Judge Marra's prior orders are hereby reinstated and ' in l force and effect. To the extent that the later order conflicts with the Cat • or e later order shall prevail and control. 8. Judge Marra's concerns regarding p cc f e Governments role in this matter are well founded in both law and fs e s ifically defer further comment ti . on this portion of this matter to maintain t of the governments investigation. 9. As a matter of cedure we note that a confidentiality order remains in full force and effect in this_rnatter. We specifically mandate that our rulings herein shall have no effect, whatsoeverr on said order and that same shall remain in full force and effect in pe e again strongly caution all counsel and mandate that they caution and co effective clients that this matter is governed by a strict confidentiality order • t this court hereby holds shall remain in Hi force and effect and which this court scrongdy cautions, contains severe penalties for any violation of sane. EFTA00795688 • unfair prejudice' s 10. This order and the complete sealed record shall be forwarded to the Department of Treasury, forthwith. The clerk of this court is ordered to expedite same. Sealed instructions shall be provided by this court to the Clerk. 11. The Department of Treasury is ordered to expeditiously review the materials and then, upon completion of same, shall immediately send a letter to this court advising that such review is complete and that they require nothing further from thjg court. Upon receipt of same, the clerk of this court shall advise Plaintiffs counsel Writ has been granted in fall and that he is free to comply fully and co Judge iviarra's orders. A copy of this order shall then be provided to al record. 12. This order shall not be furnished to any counsel til such time as the Department of Treasury has completed its review ed record and has forwarded said letter as mandated above this court. $ is self executing and thus, As tor nothing need be brought back before this court° o es issues. 13. Plaintiffs have a clear lega o th remedies they are seeking. 14. The court below bad utable duty to act but failed to to do so. 15. The plaintiffs ha remedy available to them in law or equity. t 16. If this co does not act, the plaintiffs will suffer irreparable harm and does 7~1D RDERED in Chambers, at Atlanta, Georgia, this /2 day of r v>"-i/Aa, a"4 nited States A ate Court Judge United Stutes Court of Appeals Eleventh Circuit Copies to: IRS, Planation Office EFTA00795689 FBI. Miami Office LS. Dept of Troasury, Washington, D.C. Clerk of Court, United States District Coon EFTA00795690