More From Eric Dixon at http://www.NYBusinessCounsel.com

Twitter Rank #35 For Startup Advice May 2014 (#44 June 2014, #50 July 2014 -- now TRENDING UP at #41 for August 2014). Go to my professional site for solutions to your legal, business and strategic problems. . Cryptocurrency, Cryptographic Security and Bitcoin Protocol Development -- Top Strategic Judgment -- When You Need A Fixer -- Explore Information Protection and Cryptographic Security -- MUST-WIN: How To Beat Your Enemy -- SURVIVE!: Under Investigation? Being Sued? Handling Extreme Stress -- Corporate Issues -- Startup Issues -- Investor Issues -- Contracts To Meet Your Needs -- Opposition Research -- Trademark, Patent, Copyright -- Media and Reputation Issues -- Independent, top-notch legal, strategic and personal advice -- Extensive ghostwriting, speechwriting, book writing, issue research, press and crisis management services. Listed among the American Bar Association's Law Bloggers (Blawgers). Contact EDixon@NYBusinessCounsel.com 917-696-2442.

Sunday, August 29, 2010

Mosque Imam A New Jersey Slumlord, Developer A Deadbeat John


Do as I say, not as I do.

The news media is starting to do its job.  This morning's Bergen Record reports that Ground Zero mosque imam Abdul Rauf and his wife Daisy Khan have owned at least one rundown "slum-like" apartment building in an impoverished urban section of Hudson County, NJ and have claimed financial difficulties to excuse their failure to make basic building repairs.   Yet these are the same people travelling internationally to raise funds for the mosque project.
Isn't there a term, used by the press, to characterize building owners who neglect their properties and have tenants living in rundown conditions?  Does the term "slumlord" ring a bell?
These reports -- as well as a New York Post report that developer (or more probably, front man) Sharif El-Gamal is a tax deadbeat and an earlier New York Daily News report about the supposedly waiter-turned-developer-wunderkind El-Gamal  being a patronizer of prostitutes, among other things -- are alarming.  

These reports also raise questions about the State Department's "vetting" process of Rauf -- a man whose travel abroad it recently funded -- and why elected officials such as New York City mayor Mike Bloomberg are supporting this project...and trampling on the First Amendment principle of separation of church and state.

In all probability, this is more a symptom of government incompetence more than it is a sign of some nefarious government-assisted conspiracy to turn America into a Shariah-run land.  I will not address the hysterics who populate the blogosphere (idiotosphere?).

One wonders whether there are state or federal prosecutors who are already planning to issue subpoenas to look at, among other things, loan applications and other applications for government grant monies.  Businesspeople and investors who show no regard for the rules run a serious risk of criminal investigation, prosecution and incarceration. 
As a lawyer who has seen one too many two-bit huckster-landlords try poverty to avoid court judgments -- even in small claims court -- this is a rehash of the same tired "M.O." from the owners of buildings in impoverished urban areas who know they can take advantage of the poor and uneducated. 

These press reports indicate the Ground Zero mosque backers are just playing another shell game -- or three-card monte, trying to hide the pea -- in the bazaar of New York and international politics.
Eric Dixon is a New York lawyer and president of Eric Dixon LLC.  He handles the representation of individuals and small businesses on various legal matters including government investigations, internal investigations, due diligence and background checks, strategic consulting and other advice.   

Friday, August 27, 2010

Bloom Off the Rose, Christie Sacrifices Schundler

SINCE UPDATED: See this Wednesday 9/1/10 update explaining how Governor Christie and his chief of staff Richard Bagger could have potential exposure under federal criminal statutes, depending on the aggressiveness of Justice Department prosecutors and the egregiousness of official attempts to mislead or lie to the federal government for purposes of securing federal grant money.

Press reports (Star-Ledger, www.Nj.com) state that New Jersey Governor Chris Christie fired state education commissioner Bret Schundler today after Schundler refused to resign.


This is in the wake of the embarrassing revelation that Christie rejected Schundler's negotiated Race to the Top application for federal education funding which correctly and accurately answered a question on funding, with the revised and deliberately evasive answer later losing points that were the margin of loss that cost New Jersey schools some $400 million. The record (see our earlier posts and assorted press links, courtesy of the Star-Ledger) shows Schundler crafted a complete application, only to get sandbagged by Christie (who famously rejected the application negotiated with the teachers' union).


On Wednesday, Christie accepted the blame, then tried to blame the Obama Administration. Then he announced that no one in the education department would get fired, only to sack Schundler today.


The shame here is that Schundler can demonstrate that he did his job properly. Apparently doing your job properly, even if it embarrasses your Governor, puts one's reputation and job in jeopardy under Christie.


This bodes very badly for the future.








Keeping Public Documents From The Public


More gamesplaying in New Jersey.   A county freeholder reportedly advised a group of public officials to avoid the public disclosure laws (in New Jersey, the Open Public Records Act, or OPRA) by keeping documents in their "personal possession."
If this were done after the issuance of a subpoena or warrant, commencement of a civil or criminal case, or even when production of the documents was reasonably foreseeable, this effort at concealment would warrant judicial sanctions of the lawyers or parties involved.  In fact, depending on the aggressiveness of a county, state or federal prosecutor, a criminal investigation could be launched with a prospective charge of obstruction of justice, or the tampering or destruction of public records.

Another example of how weak the rule of law can be in New Jersey.  This nonsense is much harder to pull off in New York.  The difference: a much more aggressive, and larger, press corps including blogger-investigators (like me).

Eric Dixon is a New York lawyer and president of Eric Dixon LLC.  He handles litigation counseling, lawsuit stress management, government investigations, business investigations and due diligence, opposition research, litigation and negotiation of business and personal disputes.  He can be reached at edixon@NYBusinessCounsel.com. 


Rooster Call: $400 Million Screwup and More

This morning Crime, Politics and Policy starts a new, semiregular feature: a morning recap of notable events, trends or cases from previous days.  If possible, links to the original source articles, reports or cases will be provided.  Commentary from yours truly will be added where I determine it is warranted.
 
The Obama Administration is in rapid response mode, refuting New Jersey Governor Chris Christie's absurd claim that it wasn't the Christie Administration's fault for failing to answer a simple question that was asked on the application for federal Race to the Top funding; the Christie Administration's deliberate evasion of a question cost it points which were the margin of difference (or error) in not getting a mere $400 million for state schools.  A review of an earlier draft -- one agreed upon between the teachers' union and Christie's education commissioner -- shows that the question had been fully answered in the draft, but then was rejected by Christie and subsequently revised
 
So New Jersey's Governor Christie (aka: the next president of the United States), or his appointees, tried to avoid admitting that they reduced school funding as a percentage of total state budget expenditures by a whopping four percentage points -- and in the process cost the schools $400 million. 
 
In the private sector -- the real world -- a $400 million screwup gets you fired -- if you're lucky -- and usually gets you sued...or even investigated for possible criminal wrongdoing.  
 
Given the fiscal irresponsibility that passes for establishment Republican orthodoxy these days, that monumental screwup gets you on the short list for the presidential nomination.  
 
From this corner, if Christie were a Democrat, he'd already be facing a recall movement. 
 
In the meantime, more than one in ten homeowners in New Jersey are "seriously delinquent" on their mortgages, reports Friday's Wall Street Journal.  Think that $400 million couldn't come in handy, Chris?
 
A blind governor lies about whether he intended to pay for World Series tickets -- but he's blind!  David Paterson couldn't just listen to the game on the radio, and now there's a recommendation for a criminal inquiry and possible state criminal charges for perjury and/or obstruction of justice
 
New York City's bureaucracy is legendary, but taking nine years after the 9/11 attacks to get the go-ahead for construction of new office towers is still remarkable...and abominable. 
 
Memo to Larry Silverstein:  Next time, build a mosque and it's like putting an EZ-Pass on your application...or bribing someone.  Mention you want to build a mosque, and the city, state and federal government will all trample on the First Amendment principle of separation of church and state and intimidate any and all community opposition to facilitate your project. If this isn't special, preferential treatment of a particular religious project, I don't know what one is. 
 
All I know is, in New Jersey there are about two dozen local politicians who thought they were doing the same thing for a man they thought was a developer, and who in reality was an admitted felon-turned-government informant running a sting operation. (For reference, google "Solomon Dwek" and "Operation Bid Rig" and see what you find.)  I don't see much of a difference.  Do you?
 
Eric Dixon is a New York lawyer who counsels people on lawsuit stress management, litigation and business negotiations. He can be reached at edixon@NYBusinessCounsel.com and 917-696-2442.
 
 
 
 
 
 
 
 
 


Thursday, August 26, 2010

Blind Governor Allegedly Lies About Intent to Pay For Ticket to Watch World Series

Serious news item: Independent counsel (and former New York Court of Appeals judge) Judith Kaye today issued a report concluding that New York's Governor David Paterson misled investigators regarding his intent to pay for tickets to last year's World Series.

Does it make sense for Paterson to have intended to lie about paying, when he couldn't possibly have had the intent to WATCH the game in the first place?

This is going to be grist for a Saturday Night Live skit...I am sure of it.

I can see Weekend Update's Seth Meyers now, asking Fred Armisen (playing DP):

"How do you get charged for taking free World Series tickets? I mean, you're blind! You can't watch the game! You mean you couldn't just watch it on TV...or listen to it on the radio?"

While obstruction of justice is serious and could imperil an elected official's political career in some cases, here the controversy -- in which the underlying issue is a baseball ticket -- seems plainly insignificant and a waste of scarce resources better spent pursuing more serious crimes...like corporate fraud, bonafide corruption and violent crimes.

(Eric Dixon is a New York lawyer who counsels clients on handling litigation stress. He can be reached at edixon@NYBusinessCounsel.com and 917-696-2442.)


Sent from my Verizon Wireless BlackBerry

Was Heart Attack Caused By Criminal Investigation?

The failure to handle lawsuit stress -- or the stress of an ongoing criminal investigation -- can have major health consequences. An interesting Albany Times-Union story out of the Capital District region of New York today, where a stockbroker and his firm "are the subject of parallel probes" by the Securities and Exchane Commission and the U.S. Attorney's Office in Albany, and the broker reportedly suffered a heart attack from the probes. 


It is hard to conclude -- without more evidence -- that there is a causal connection, but being sued or investigated can be infuriating and highly stressful. The failure to cope properly can weaken your ability to withstand the scrutiny and destroy your ability to fight.


Eric Dixon is a New York lawyer who deals with lawsuit stress management, litigation stress and investigation stress. He can be reached at 917-696-2442 and edixon@NYBusinessCounsel.com.





Wednesday, August 25, 2010

Mulshine on Muslim Leaders' Evasions

There is a perceptive column from the Star-Ledger's Paul Mulshine today on the Ground Zero mosque outrage. Link at http://blog.nj.com/njv_paul_mulshine/2010/08/the_attitude_behind_the_mosque.html.

The column repeats in large part a 2001 Mulshine interview with a New Jersey Muslim leader. It illustrates how the Muslim "leadership" has exhibited a shocking, alarming and possibly dangerous defiance of calls to condemn extremist groups after the 9/11 attacks and continuing to this day.

Sent from my Verizon Wireless BlackBerry

First Amendment Religious Tolerance

As the Ground Zero mosque controversy swirls...

The 9/11 mosque supporters cite the First Amendment for freedom of religion. They forget the rest of the First Amendment, which notably precludes the "establishment" of a religion. This latter clause engendered the principle (since raised to the status of a sacrament) of "separation of church and state."

Freedom of religion does not, however, entitle the adherents of a particular faith from seeking, receiving or enjoying special treatment, preferential treatment or other advantages from government. Such treatment amounts to a government endorsement of that religion, and a dis-endorsement or disapproval of other faiths.

No one is entitled to compel a government action, or to infringe upon the rights of others. A true right, by nature, is one which imposes no cost or burden upon another.

(Eric Dixon is a New York lawyer. He is available for comment at edixon@NYBusinessCounsel.com and at 917-696-2442.)


Sent from my Verizon Wireless BlackBerry

Jersey Kids Pay Price for Christie's Arrogance

It's a simple rule: Answer the question. And New Jersey -- under the stewardship of Chris Christie -- arrogantly ignored it. Now New Jersey lost out on $400 million in federal school funding because the state government failed to answer a five-point question asked in the application, getting just a fraction of a point awarded, and ended up trailing the last funding winner by three points, reports the Star-Ledger in an article to appear in Thursday's editions.


The question asked for a comparison of 2011 budget expenditures against 2008-09 expenditures. The Christie Administration rejected the original application question because it answered the question that was asked, and made an embarassing comparison that would have revealed that the percentage of the state budget devoted to education declined from 39.6% in 2009 to 35.4% in 2011.  These numbers clearly indicate that education as a percentage of state spending was cut more than average, and a four percentage point drop is a serious, material decline.  No wonder the Christie Administration tried to hide that fact.  


So...by trying to ignore the question, the state totally flubbed the section.


This strategy was a transparent effort to ignore the federal government's question, and shows an intellectual arrogance which may have ruffled feathers in Washington.  Even worse, it was followed up by an amateurish, childish effort to shift the blame.   


Lawyers and judges chide witnesses to answer the question that is asked, and not the question that the witness wishes had been asked. Judges giving this instruction on cross-examination, and lawyers at depositions, often -- and justifiably -- get incensed when witnesses try to elude, evade and deceive their questioner.

And may I ask:  What was the policy of Christie's U.S. Attorney's Office towards public officials who failed to disclose certain things involving money?   Right you are -- those people got indicted (see: Ferriero, Joseph).  So either Christie the federal prosecutor oversaw wrongful prosecutions, or he (or the staffers in his Administration) demonstrated hypocrisy.


This intellectual dishonesty -- and arrogance -- will cost New Jersey schoolchildren.


Well...only the public school students.


Christie's kids -- and Education Commissioner Bret Schundler's kids -- all go to private school. They get off fine. It's those other kids, from the non-exclusive, plebeian parts of the state...they're the ones paying the price.


Someone's head should roll for this.











REIT Strategic Defaults

I hear that REITs are choosing to strategically default on large commercial loans in order to conserve cash and/or improve bargaining power for renegotiations and refinances, despite being able to make their payments.

The moral hazards of the bailouts and TARP are showing up in the private sector. Just like I predicted two years ago. (Circa October 2008.)

This bodes very badly for the banks.  And tomorrow's borrowers, individuals and businesses alike, will have a much harder time getting decent loans as long as strategic defaults are on the minds of bankers.  After all, what is good business sense today for one group will beget what is good business sense for bankers tomorrow.  Expect much higher rates, much lower loan-to-value ratios and greater numbers of representations, warranties and negative covenants in agreements.  As strategic default risk grows in the banking lexicon, banks will adjust by trying to ameliorate this risk.  Consumers and small business owners will soon pay the price. 

Losing Race to the Top School Funding

New York has gained, and New Jersey did not qualify for, federal Race to the Top funding. This means that New Jersey lost out on approximately $400 million.

The sniping between teachers' union New Jersey Education Association and Governor Christie has begun.

This brings to mind one of Christie's strategic flaws: confusing in his mind -- and perhaps intentionally confusing voters -- the distinct constituencies of teachers and NJEA union members.

All teachers are NJEA members. However, not all NJEA members are teachers. In fact, many NJEA members have long since retired.

This explains NJEA's opposition to rolling back tenure, to protect their longest serving members.
It should be apparent to younger teachers that their union treats them as third-class members. Not all dues-paying members are equal (although older members have paid more dues; it's as if the membership power was weighted according to tenure). Not surprisingly, the younger teachers are the ones bearing the brunt of the layoffs.

Does this make the NJEA evil? That depends on your perspective. One perspective is that the NJEA is fulfilling its duty to its membership, and that means, to many former teachers who are now retired.
Remember the foregoing paragraph the next time the NJEA tells you it is for teachers, kids and education. It isn't -- and shouldn't be.

The NJEA is for its members and only its members. Got it?


In the meantime, the Christie Administration has done virtually nothing regarding retiree benefits. Getting rid of double-dipping public officials is window dressing compared to the huge pension liability facing most states, and one which Christie did not fund this year -- just increasing the deficit in 2011.

Perhaps the master plan is to push the pension plans into insolvency, and bankruptcy. Perhaps its a way to defer the problem until a time when Christie has the strongest bargaining power. Strategically, that may make the most sense and maximize his chances of victory.

Eric Dixon is a New York lawyer, member of the bar of both New York and New Jersey, and comments regularly on public policy and political/economic strategy. He can be reached at edixon@NYBusinessCounsel.com and at 917-696-2442.


Sent from my Verizon Wireless BlackBerry

Tuesday, August 24, 2010

Culture of Corruption?

Last year, acting United States Attorney Ralph Marra referred to a "culture of corruption" in New Jersey after the legendary Bid Rig arrests were announced.  (This was the case in which admitted bank fraudster Solomon Dwek starred as a filmmaker and agent provocateur.)  Marra's comments followed years of his predecessor Chris Christie's targeting public corruption in New Jersey. 

Now the new U.S. Attorney for New Jersey, Paul Fishman, believes that there isn't necessarily a "culture of corruption."  (See this commentary piece by Bob Braun of the Newark Star-Ledger.)  This may be true, technically.   However, what peope sense is a culture of public emplopyee privilege, of special treatment, of a double standard.  The actions and attitudes which give rise to these sentiments often do not amount to crimes at all -- even in an era where federal crimes are so expansive that noted criminal defense lawyer Harvey Silverglate wrote a 2009 book titled "Three Felonies a Day" -- but many people instinctively feel that something just isn't fair, just, equitable, or right in the Garden State.  

Perhaps it is more accurate to talk about a culture of entitlement, of special privilege.  

U.S. Attorney Fishman seems a much more sedate -- some would say, professional -- man.  I surmise that he wishes to avoid antagonizing the public sector officials (elected or appointed), administrators and other employees.  After all, many of them know or will come across evidence of potentially criminal behavior.   A smart prosecutor will want to welcome in these tips and keep the pipeline of information as open as possible.  That may be the most prudent approach to protecting the people of New Jersey.

Eric Dixon is a New York lawyer.   

Know Where You Stand: Mosque Protestor in Horse Dung


At Sunday's Ground Zero mosque protests -- one small one in support of it and a larger and much more boisterous one against it -- there were plenty of New York City police officers on horseback patrolling the events.  There were also large news media contingents, meaning lots of attention for protestors, especially ones who are telegenic, loud and had signs. 



The woman in the middle of these photos -- whose face is obscured by our flag, so she is neither embarassed nor becomes a YouTube sensation -- was distracted by the attention and never noticed she was standing amidst a large pile of fresh, moist horse droppings.  Look carefully.  It would have been impossible to miss...if she only paid attention.  The woman obviously is neither a New Yorker nor a farm girl.
Lesson to protestors:  This is New York City, where picking up after your pets and farm animals is optional and common courtesy is not common.  Look down where you step.  Especially if you're wearing nice shoes.
Eric Dixon is a New York lawyer and blogger on legal, political and economic issues.  He is a native New Yorker and always looks where he walks

Saturday, August 21, 2010

Mosque Supporters Ignore Separation of Church and State

The support by government at all levels (national, state and local) for the Soho Properties' Ground Zero Mosque project at 45-47 Park Place, New York NY 10007 raises numerous suspicions.  It is the position of this blog that the government approval and preferential treatment of the project may violate the bedrock First Amendment principle of separation of church and state, as expressed by the First Amendment's Establishment Clause.  Please check my summary legal analysis of the Establishment Clause implications
 
A protest against the project will be held Sunday, August 22nd, and more information is available here.
 
 I plan to be at the protest/rally/event (you pick the term) and will report live Sunday.
 
Eric Dixon is a New York lawyer and strategic analyst.  He is available for consultation, projects or comment at edixon@NYBusinessCounsel.com and 917-696-2442.  
 


 

Lose Reputation, Keep Your Freedom: Why Clemens Should Have Shut Up

Roger Clemens was indicted for lying to Congress in connection with its investigations into steroid use by professional athletes.



In general, people facing possible litigation in any scenario, but particularly if they are under government scrutiny -- and most particularly if they have a "name" who can add cachet to a prosecutor's resume -- should resist the temptation to try to explain things away and should strongly consider just remaining quiet. Of course, experienced and reputable counsel is a must in any such situation.

Unless Clemens knows that he is telling the truth, his testimony before Congress in early 2008 could prove his undoing (whether he is guilty or not) and lead to his conviction and incarceration. The dilemma Clemens faced was that silence in such a situation could have led to snickers that his silence equated guilt. (In fact, the snickers were there for years beforehand, and likely would never go away under any circumstance.) Hence, Clemens chose to testify before Congress, despite almost certainly having been warned by counsel (in Clemens' case, by a team led by Texas lawyer Rusty Hardin) that his testimony could allow for investigators to "set in stone" his version and then work to debunk it in order to build the perjury case which has now been brought.

From my standpoint, in general, any comment by a prospective target of an investigation could lead to civil or criminal charges, even if the target had done nothing wrong to begin with. There is always a risk of talking on the record, because -- at best -- it gives an opportunity for investigators to compare one's version with someone else's and claim (sometimes, wrongfully) that any contrast in the versions of events equates to criminal perjury.

As a result, while silence may lead to reputational damage (which arguably is unavoidable) and a devaluation of the "brand," it would likely preserve the target's freedom and prevent a civil or criminal case from being brought.

Clemens' undoing (again, whether he's guilty or not) may come from his decision to place defending his reputation above all else. It may cost him his freedom.

However, people in his situation -- and most especially, anyone with a high profile -- have to come to grips with the reality that there are always going to be snickers, no matter how "clean" you are. Being a high-profile person, someone who has "become somebody" and "achieved something," does mean that you will be a target of others' schadenfreude -- the desire to see you fall, or fail. 

To my mind, the failure to accept this fact is a form of mental weakness and a serious professional vulnerability.   One of the things I do professionally is help people in such situations develop the mental toughness, and character strength, to absorb and resist these snickers and public criticism so that they can ultimately withstand the pressure of litigation and be in a position to prevail in the only court that counts -- the court of law.

Count me as among the shocked, that people who have accomplished great things and been accustomed for decades to being in the public spotlight have not accepted the basic fact that criticism from others is an inescapable part of being in the public eye. The fear of criticism and desire to eliminate it seems to lead some of these people to say and do things which are simply not in their best interest from a legal standpoint. Had Martha Stewart heeded this advice and simply refused to speak with investigators regarding the insider trading allegations then swirling around Imclone president Samuel Waksal, Stewart almost certainly would never have been investigated, criminally charged and ultimately convicted of lying to investigators in 2004.

Sometimes, silence is the best policy, even when it makes you look bad.

Eric Dixon is a New York lawyer. He can be reached at edixon@NYBusinessCounsel.com and at 917-696-2442.

Thursday, August 19, 2010

Roger Clemens to be Indicted for Lying to Congress

Bloomberg News Radio reports (update: and it since has been widely reported and confirmed) that baseball star Roger Clemens will be has been indicted for lying to Congress in connection with its investigations into steroid use by professional athletes.

This involves a violation of the false statements statute, section 1001 of title 42 of the United States Code (42 USC 1001), the same section that tripped up Martha Stewart.

If true, this helps explain why people under scrutiny -- particularly those with a "name" who can add cachet to a prosecutor's resume -- should resist the temptation to try to explain things away and should strongly consider just remaining quiet. Of course, experienced and reputable counsel is a must in any such situation. 

Unless Clemens knows that he is telling the truth, his testimony before Congress in early 2008 could prove his undoing (whether he is guilty or not) and lead to his conviction and incarceration.  The dilemma Clemens faced was that silence in such a situation could have led to snickers that his silence equated guilt. (In fact, the snickers were there for years beforehand, and likely would never go away under any circumstance.)  Hence, Clemens chose to testify before Congress, despite almost certainly having been warned by counsel (in Clemens' case, by a team led by Texas lawyer Rusty Hardin) that his testimony could allow for investigators to "set in stone" his version and then work to debunk it in order to build the perjury case which has now been brought.  

From my standpoint, in general, any comment by a prospective target of an investigation could lead to civil or criminal charges, even if the target had done nothing wrong to begin with.  There is always a risk of talking on the record, because -- at best -- it gives an opportunity for investigators to compare one's version with someone else's and claim (sometimes, wrongfully) that any contrast in the versions of events equates to criminal perjury.  

As a result, while silence may lead to reputational damage (which arguably is unavoidable) and a devaluation of the "brand," it would likely preserve the target's freedom and prevent a civil or criminal case from being brought. 

Clemens' undoing (again, whether he's guilty or not) may come from his decision to place defending his reputation above all else.  It may cost him his freedom.

However, people in his situation -- and most especially, anyone with a high profile -- have to come to grips with the reality that there are always going to be snickers, no matter how "clean" you are.   Being a high-profile person, someone who has "become somebody" and "achieved something," does mean that you will be a target of others' schadenfreude -- the desire to see you fall, or fail. 

Count me as among the shocked, that people who have accomplished great things and been accustomed for decades to being in the public spotlight have not accepted the basic fact that criticism from others is an inescapable part of being in the public eye.  The fear of criticism and desire to eliminate it seems to lead some of these people to say and do things which are simply not in their best interest from a legal standpoint.  Had Martha Stewart heeded this advice and simply refused to speak with investigators regarding the insider trading allegations then swirling around Imclone president Samuel Waksal, Stewart almost certainly would never have been investigated, criminally charged and ultimately convicted of lying to investigators in 2004. 

Sometimes, silence is the best policy, even when it makes you look bad.

Eric Dixon is a New York lawyer.  He can be reached at edixon@NYBusinessCounsel.com and at 917-696-2442.

 

Wednesday, August 18, 2010

Schuck's Genuine Connection Test for Citizenship Will Hurt Kids

The second-biggest controversy of the summer (behind the Ground Zero mosque) is apparently illegal immigration. Some Congressmen have advocated amending the Fourteenth Amendment to clarify that so-called "birthright citizenship" -- the concept that anyone born within our borders is an American citizen with no further action or qualification necessary -- would not be allowed to the children of illegal immigrants even if born here.     


The debate was joined over the weekend by Yale Law School professor Peter Schuck, who penned a New York Times op-ed titled "Birthright of a Nation."


I know Peter Schuck.  I was a student in Professor Schuck's first-year Torts class many years ago at Yale and remember his sensitivity to the many logistical considerations in crafting legal and regulatory solutions for problems. It is with some surprise to read that he suggested conditioning birthright citizenship on having a "genuine connection" to our society.  Schuck's idea amounts to interesting scholarship -- it's thought-provoking and would make for an excellent afternoon of debate among the Mensa crowd on Wall Street (that is, Wall Street in New Haven -- Yale Law School's address is 127 Wall Street, if I recall.)   But in the real world -- never mind the world governed by realpolitik -- I foresee many logistical problems to these proposals.


Discarding the "bright line" rule of birthright citizenship will place all Americans -- and most especially, our children -- at risk of having to establish their bonafide right to be here. Unless we have a national registry of all citizens, all of us, to be fair, will have to justify our citizenship. As for our children, if citizenship depends on one's parents, an orphan or abandoned child would be without the means to meet his burden of proof on citizenship. A tenth-generation "American" who is disowned by his family would have to prove his "genuine connection" -- and in the meantime face the risk of future expulsion from his country.


What happens if the "genuine connection" standard is adopted as the requirement for citizenship?  How would this be measured?  Who would do the measuring?


What happens to those millions of currently American citizens who were born in Puerto Rico, a commonwealth and island which every few years votes in highly-charged elections to maintain that commonwealth status rather than elect statehood?  What would the "genuine connection" be for Puerto Ricans born on the island, where Spanish is the predominant language?  Is language a factor in determining this "genuine connection"?


A national citizenship bureaucracy will need to administer these processes and create a registry, giving many jobs to bureaucrats and lawyers while placing our futures in doubt. Moreover, such a registry will threaten our privacy and render us more vulnerable to abuses from the miscreants among the growing legions of unsupervised, unaccountable government workers with access to our "file."


We should also fear whom among us will be chosen to judge whether we have the requisite "genuine connection." What political considerations could affect this process? Would tomorrow's political opponents be at risk of losing citizenship? Can we all run the risk of becoming tomorrow's Napoleons, doomed to exile on Elba? (Hey, maybe Staten Island will do.)


It also deserves noting that this entire controversy exists only because of the federal government's initial failure -- or conscious indifference -- to securing our borders. The solution to the government's failure to exercise its power is not to grant it even more power. And our constitutional rights should not be diminished every time our government's shortcomings are revealed.


Eric Dixon is a New York attorney.  He can be reached for comment or consultation at 917-696-2442 and edixon@NYBusinessCounsel.com.

Friday, August 13, 2010

Hate Blogger Hal Turner Convicted

Now, merely saying that someone else deserves to suffer harm may expose the speaker to criminal prosecution.

A highly-controversial New Jersey internet blogger and radio host, Harold Turner (aka Hal Turner) was convicted this afternoon in Brooklyn federal court on one charge of threatening three federal judges, writing that these judges (including Judge Richard Posner) "deserved to be killed" for ruling in favor of a handgun ban.

Turner's first two trials ended with hung juries (no unanimous verdict) after he used privately-paid counsel (Newark's Michael Orozco). This time, as his funds ran out and after he filed for bankruptcy, he used the chief federal public defender in Brooklyn. Although some may be tempted to use this fact as the reason for his conviction -- and I report on this fact because it is of interest to readers -- I do not believe it was a factor.

The legal issue from this observer's standpoint is how to draw a bright line on free speech and opinion advocacy. A lot of genuine free speech and worthy opinion will be chilled if the federal government can convince juries that emotional or even inflammatory speech constitutes criminal harassment or unlawful provocations of violence. Congress needs to act to give Americans guidance on how to measure their desired speech against this verdict. The Obama Justice Department is also able to provide its guidance, as it is charged with evaluating such speech.

Naturally this case was brought because free speech proponents have difficulty defending the speaker and the speech on their merits. An unpopular or reprehensible defendant makes a great target. Readers should note that totalitarian regimes are well aware of this. Let us hope that we have not moved closer to the day when political opposition is a crime (although former Alabama governor Don Siegelman might argue that has already happened).

Also worthy of noting: The FBI had been paying Turner for years to say various inflammatory or outright racist statements, purportedly to incite and thus get violent extremist elements to reveal themselves and take the substantial step, the "overt act," needed to support a criminal charge. Why the federal government was paying this guy (of all people) -- or others, of which you can be sure -- in the first place, for any reason, should be worthy of examination by Congress.

Eric Dixon is a New York lawyer.

Thursday, August 12, 2010

Cash Back Scam Warning

I am hearing anecdotal reports of customers at major retailers being charged for "cash-back" requests they claim not to have made.

The way this scam reportedly works is as follows: The cashier keys in or punches in a code for a cash-back request. The request shows up on the receipt. The cashier often tries to delay giving a receipt unless the customer specifically asks for it. The illicit request results in the customer beig charged the higher, fraudulent amount, and the cashier swipes the difference (the false cash-back amount) from the register later.

This illustrates a larger point. Convenience has a price. When we sacrifice security - or choose to pay by credit/debit card instead of cash - for convenience or speed, we make ourselves vulnerable.

It bears emphasizing that customers paying cash are not vulnerable to this scam.

Sent from my Verizon Wireless BlackBerry

Wednesday, August 11, 2010

America: Already Bankrupt

Good morning. I am just going to link to this commentary (at http://noir.bloomberg.com/apps/news?pid=20601039&sid=aiFjnanrDWVk) which speaks for itself.

The facts related in this article, and the inferences one may draw therefrom, engendered the deficit hawks (and the Perot and Concord Coalition movements of the early 1990s and today's Tea Parties).

On a related matter: Ever wonder where all the stimulus money -- paid for by you and me -- has gone?

I believe this stimulus money has gone straight into the pockets of certain business owners and corporations. But anecdotal evidence suggests it isn't being spent. It is being hoarded, as if there is an expectation of an impending nuclear winter.

The causes of this trepidation: a growing uncertainty over future legal changes (from new regulations); the growing erosion of the rule of law and sanctity of the contract as more judges grant mercy to debtors claiming hardship or victimization; and an uncertain economic climate.

Remember: Mercy to the borrower, is discrimination against the lender.

When lenders get hammered by the courts and their profit margin shrinks, the balance between risk and reward also tilts. Once the balance clearly tilts more heavily towards risk (where we are now), the reward prospect will be insufficient to induce investment or risk-taking. Capital will stay home. That has been what is happening this year.

(Eric Dixon is a New York lawyer and the president of Eric Dixon LLC. He is reachable for comment or consultation at edixon@NYBusinessCounsel.com.)

Sent from my Verizon Wireless BlackBerry

Sunday, August 8, 2010

Con Edison Can Block Ground Zero Mosque

The somewhat intrepid New York tabloid media is finally hitting some pay dirt on the ownership of the land on which Soho Properties desires to build a mosque, some hundreds of feet away from Ground Zero.  While Soho Properties represented that it owned two buildings, legally they only own one structure, and have merely a purchase option -- for an as-yet-undetermined price -- on the adjoining structure. (If you spot a neon awning for "Dakota Roadhouse," walk about thirty feet to the west and you'll be in front of the site in question.)  As the price in question has not been determined and could be subject to considerable negotiation, a deal is not certain; hence, mosque construction is far less certain. 
 
Moreover, lawyers for opponents will be thrilled to learn that the second building (the far more decrepit 45 Park Place) is owned by no other than Con Edison, a publicly traded utilty (NYSE ticker: ED).  This gives new avenues for opponents to attack, using all the tools of activist shareholders.  There can be issues and questions regarding fiduciary duties, proper valuation, and so on. 
 
Now some observations and inferences drawn from the various disparate facts that are emerging: 
 
Note that the one building (47 Park Place) that Soho Properties does own was before the Landmarks Preservation Commission for designation as a landmark since 1989 -- that's right, 21 years.  Also note that the current owner, Soho Properties, only bought the building in 2009. An adjoining building is one they must purchase for their plans, as detailed in the article.  (Walk by the site with a measuring tape.  These are narrow buildings on old plots and one commonly has to purchase multiple buildings just to have the space to develop any modern structure.) 
 
One suspects an as-yet-condition to the purchase may have been a back-channel -- and possibly illegal -- assurance from the City of New York that the LPC would deny landmark designation. Few intelligent investors spend millions of dollars to purchase a property if they cannot develop it without restriction.  If the City of New York (read: the Bloomberg administration) used its power and influence over the LPC to benefit a private party, might someone at the Department of Justice (or merely Manhattan District Attorney Cy Vance's office) be curious at taking a look at these arrangements?  After all, politicians who seek or dispense special favors to real estate developers could face criminal charges for bribery; just plug the name "Solomon Dwek" into your browser and search, or link to my January 2010 report on a huge New Jersey public corruption scandal).  At a minimum, even if such a practice did occur and is legal, it would bolster the claims by former New York City firefighter Tim Brown -- the plaintiff in the first civil case against the LPC -- that the LPC did not act in accordance with its customary procedures. 
 
It is worth noting that Vance is already looking at Bloomberg for his Independence Party payments in connection with a still-unfolding criminal investigation, one which has already led to charges against Bloomberg political operative John Haggerty.  (Haggerty, who appears to have been thrown under the bus, has pled not guilty and awaits trial.)
 
Heck, if all these events occurred in New Jersey a few years ago, wouldn't then U.S. Attorney Chris Christie (aka the next president of the United States) have convened a grand jury to investigate?
 
Eric Dixon is a New York lawyer and president of Eric Dixon LLC.  He is an investigative lawyer with substantial knowledge in corporate law, securities law and privacy law matters.  He can be reached at 917-696-2442 and edixon@NYBusinessCounsel.com for further comment.
 
 


Saturday, August 7, 2010

14th Amendment Watch: Citizenship Tests Coming?


One wonders if the entire Fourteenth Amendment, and the rights it espouses, is under wholesale attack.
Every so often there are isolated calls to revise the law, or the Constitution, to address failures of the federal government.  As Crime, Politics and Policy reported back on Memorial Day weekend, Congressman (and likely 2012 presidential candidate) Ron Paul called for an end to automatic citizenship by birth inside our borders.  Now the New York Times has taken notice, with South Carolina Senator Lindsay Graham (another possible presidential contender) saying the same thing.   Both Paul and Graham -- and other elements of purportedly conservative ideology -- support removing the Fourteenth Amendment provision that guarantees citizenship to all those who are born here. 

Once again, we see elected officials proposing that the solution to the federal government's abject failure to fulfill its obligation (such as to keep the border secure) is to reduce or obliterate the legal rights of its citizens or residents.
Illegal immigration is a major problem.  It represents an erosion in the rule of law.  It presents a major moral hazard, because it shows regular, law-abiding people (citizens and permanent resident/green card holders who followed the rules and stood on line) that cutting the line and jumping the border gets rewarded.   As young children will tell you, rewarding bad behavior produces...more bad behavior.  (Our prosecutorial authorities seem not to realize this and routinely encourage or reward "cooperating witnesses" who are willing to commit perjury if it helps their cases...but that's a story for another day.) 
The influx of migrant workers -- no matter how hard they work or the unpleasantness of jobs that "Americans just won't do" -- depresses the labor market.  Don't listen to the self-proclaimed small business advocates and chambers of commerce, whose only concern is maximizing their profits and will sell your mother to the nearest organ harvester for a quick buck.  Our economy does not need illegal alien workers.
The removal of the citizenship-by-birth provision is aimed at discouraging illegals from coming here, having babies here and then being able to stay here on a "hardship" basis or having those children -- once they are adults -- sponsor their families.   But once birthplace no longer ensures one's citizenship, then all citizens would have a de facto burden of proof to show that they were born to citizen or legal resident parents.

There is little objective evidence on citizenship desires for as-yet-unborn children being the prime motive behind illegal immigration.  I thought the primary motive is and always has been economic.  This seems a spurious basis for the proposal.
What if you're an orphan?
What if you are estranged from your parents -- say, kicked out of the house at age 18?
I can see a scenario where children become dependent on the honesty of their parents to confirm their own legal status, in order to prevent the child from having his citizenship revoked.  Such a dependence will foster all types of abuse whether it be legal, financial, emotional or sexual (or a combination of them).
An entire bureaucracy will have to be created to handle a new "citizenship admission process."  The government will need plenty of lawyers will be needed -- lawyers like me, that is -- to both administer the bureaucracy and whatever "tests" are implemented, and litigate any disputes and evolving regulatory and judicial interpretations.  And virtually all Americans will be at risk of needing special "citizenship counsel" to guide them through the process.
Or maybe the government will just tell us to pick straws.
Another problem: What happens to those who are born here, raised here, etc. and then are stripped of citizenship?   If you are expelled from the United States, where do you go?  Will we be creating a new class of nomads -- Palestinians of the Western Hemisphere -- a people without a land? 
What about the slippery slope?  If today we can strip you of citizenship because your parents were not here legally -- or because you cannot prove your parents were here legally -- what other criteria can be used tomorrow to strip you of citizenship and expel you from the country?  Committing a crime?  Disfavored political views?  Engage in behavior considered deviant?
What about other aspects of the Fourteenth Amendment, like the rights to due process and equal protection?  If those rights are attacked and struck down, then all Americans will be at the mercy of the then-ruling class.
In such a situation no American will be secure in his / her expectation of being allowed to remain in the country. That would have disastrous consequences for our economy, as the entrepreneurial class will not invest in businesses here without a guarantee of being allowed to remain.

In reading these proposals, I think back to some of Hollywood's post-apocalyptic movies -- like "The Handmaiden's Tale" (starring the late Natasha Richardson) and even "Escape from L.A" (the sequel to "Escape from New York," both with Kurt Russell starring) -- portraying the United States as run by religious fascists.  Combine these movies' concepts with ObamaCare, and we may as well retreat underground, like the underground city in "Logan's Run" and all die at age 30.  (Hey, there's cost control for you.)  The English seem more attuned to the consequences of these forms of abuse; check out the recent 2006 movie "V for Vendetta," which starred Natalie Portman and featured Britain's Parliament getting blown up at the end.

Those who object to Islamofascism (or "radical Islam," if you prefer) and the human rights abuses under sharia should take note that the United States would be following the slippery slope in their direction.
It is hard to think of a more misguided -- and abominable -- concept.   All Americans are at peril now.
Eric Dixon is a New York lawyer and president of Eric Dixon LLC.   He can be reached at 917-696-2442 and edixon@NYBusinessCounsel.com


Tuesday, August 3, 2010

Ground Zero Mosque OK But Nativity Displays Forbidden

The de facto preference of the New York City government towards one mosque, to be constructed on the literal edge of Ground Zero (one block away) and likely to be financed with foreign capital (hmmmm), continues.  And we continue to be worried, as a general rule holds that, no matter the context, a preference towards one is discrimination towards all others.  The Ground Zero mosque controversy is no different.

A constitutional analysis of the Religion Clauses (both freedom of religion and the establishment clause) should consider the following:

(1) A Greek Orthodox Church, destroyed in the 9/11 attacks, has yet to be rebuilt and reportedly is facing government bureaucratic hurdles; and

(2) Numerous nativity displays are routinely banned from public places and even from multi-unit residential developments.

Nativity scenes are generally not situated in public places because of the concern that, however benign the symbolism, scenes depicting the birth of Christ suggest the supremacy of Christianity; hence, the public display leads to an inference (however wrong) that the public entity prefers -- if not endorses -- that faith.  Nativity scenes are now customarily forbidden from public places in order to respect the equality of all faiths under the law and to demonstrate the state's neutrality.  In other words, public entities now customarily strive to avoid the appearance of favoritism, of preferring, any one religion.  This is done to respect the sensibilities of those people who may share in non-preferred faiths and who may be offended by the concept that the state prefers a faith which they do not share, and which by logical extension means that the state accords their faith second-class status. 

This is not of small significance.   Perhaps there is no more efficient way to offend a group of people than to suggest that their faith is inferior to another faith.  Regardless of upbringing, there seems to be an innate human belief system which values the concepts of equality and fairness.   The concept of "my God is better than your God" is guaranteed to spark strong emotions. 

The related concept of one faith possessing a particular site is also highly troublesome.  Ask anyone who's been to Jerusalem recently.  Mosque opponents sense that the mosque would be a beacon, a symbol of triumph, of territorial possession -- of victory in the wake of 9/11.  Yet no one suggests that a new Christian church be established on the edge of Ground Zero (this would also be improper for the exact same reasons).

Our Founding Fathers recognized that such dangers could destroy the secular state.  They rebelled against -- and their ancestors fled -- monarchies which preferred and established state religions.  This sentiment, recognizing the abuses and the risk to the young country of having some citizens feel their faith was second-class, led to the constitutional bedrock principle of separation of church and state, and was the genesis for the Establishment Clause.

Today, New York City's government consciously chose to ignore the lessons of history, of the pre-American Revolution abuses under colonial rule, the religious persecution which characterized most civilized societies up until the advent of the secular state -- the United States being the first.  It also ignored the lessons of appeasement, such as at Munich in 1938.

The powerful symbolism of this development should not be ignored. Somewhere, today, there are visions and celebrations of the first bastion of a new, New World Islamic caliphate, situated at, of all places, the site of the greatest civilian loss of life due to a military or terrorist attack in the history of the United States -- and one of the greatest civilian casualties from any cause ever (natural disasters included).

The root cause of this, it appears, is a manifestation of the Stockholm Syndrome. Maybe city leaders seek to assuage and appease radical Muslims to prevent another attack. More likely, city leaders feel they have the burden of proof to show that they respect the freedom of religion of Muslims.

The First Amendment freedom of religion is freedom from government abridgement of the right to worship. It is laughable to propose that the Islamic congregation which has worshipped in the Tribeca neighborhood of Manhattan (a few miles north of Ground Zero, in an entirely different neighborhood), has had their freedom of religion abridged because of the particular situs of their services. 

Does the freedom of religion include a "right" to select one particular, and uniquely significant (if not outwardly confrontational) site for a house of worship? If so, what is it about the favored group -- in this instance, Muslims -- which creates a corresponding "obligation" of others to suffer the offended sensitivities so that Muslims may not feel intimidated?

In fact, how can something be a "right" if it requires imposing an "obligation" to perform some act or duty by others?  The classic American rights of life, liberty and the pursuit of happiness share one classic trait:  they do not require the performance by anyone else of any act.  This means that one may have and exercise these rights without any imposition or interference with or upon another.  

True rights require no obligation upon others nor impose a burden upon others.

The mosque's construction will infuse a secular, tragic site with one religion's significance and identity. It will start the move towards the Islamification of Ground Zero, and of New York.
Instead, today, the 9/11 victims are told to apologize for making Muslims feel discomfort.  The Muslim community, which largely had a muted reaction to the attacks but a much more strident demand for "tolerance" and protection in their wake, has never distinguished itself in condemning the attacks, the vitriol and venom which engendered them or in disassociating itself from those who supported hateful, dangerous or murderous sentiments.  Yet the Muslim community is enjoying victim status and the preferences which our governments all too often bestow on those it classifies -- rightly or wrongly -- as victims. 

To use an economic analogy, this rewarding of less-than-distinguishable behavior creates a moral hazard.

New York has had its Munich moment.

Let's hope history does not repeat.

Eric Dixon is a New York lawyer.  He will be continuing his research on this topic and preparing a possible amicus brief for anticipated federal litigation.  He can be reached at 917-696-2442 and at edixon@NYBusinessCounsel.com.

Mosque Landmark Status Rejected; Legal Challenges To Come

The New York City Landmarks Preservation Commission just voted unanimously to decline to grant landmark status to two buildings, one block from Ground Zero, which their owner intends to convert into a mosque.

Despite the vote, some commissioners' remarks provide support for a continued fight, this one assuredly in court. Commissioners acknowledged the historical value of the building, with one remarking that the building (47 Park Place) was of landmark quality if it were within a landmark district. (Here's the rub: it's not in a landmark district.).

The commissioners also remarked -- curiously -- that the surrounding area was not of the quality to be considered a landmark district. Yet almost all commissioners acknowledged the great historical significance of 9/11.

Some press are asking protestors about the issue of freedom of religion. I believe this to be both a false argument and to underscore the journalists' lack of understanding of a basic constitutional issue. Freedom of religion is a freedom from state incursion; not only is that absent here, and the Muslim congregation has presently been practicing for decades about one mile away, but the state actions (to approve the construction) implicate the principle of separation of church and state and thus raise Establishment Clause issues, in my opinion.

Now the fun starts. 

UPDATE:  On Wednesday, August 4th, keep your ears peeled for a lawsuit to be either announced or filed.  UPDATE 2:  On Wednesday, as expected the American Center for Law and Justice filed a lawsuit in Manhattan Supreme Court on behalf of plaintiff-firefighter Tim Brown.




Sent from my Verizon Wireless BlackBerry