Judge: 2 Lawyers Vulnerable to Contempt for Referring to Material in Unsealed Documents

U.S. Eastern District Judge Brian M. Cogan yesterday released the bulk of the records being sought by the Associated Press in its quest for documents relating to Donald Trump’s business dealings with a real estate developer, who had mob connections and a hidden criminal record in his past.

But at a court hearing in Brooklyn yesterday, Cogan offered no quarter to the two lawyers before him, whom he has referred for a criminal contempt investigation. He repeatedly, and sharply, warned lawyers Fred Oberlander and Richard Lerner that they could face more contempt charges if they publicly reveal information about materials sealed by a host of gag orders issued in a criminal case involving the the real estate developer since 1998. That could be the case, he stressed, even if the previously sealed document has been unsealed.

In 2012, Cogan was appointed pursuant to a directive issued by the U.S. Court of Appeals for the Second Circuit to enforce gag orders issued by Eastern District Judge I. Leo Glasser and the appeals court itself. Oberlander was hit with a series of injunctive orders after he filed a lawsuit in 2010 using papers from the sealed criminal file of developer Felix Sater, who had pled guilty to a pump-and-dump stock swindle in 1998. In return for his cooperation with federal prosecutors in Brooklyn, Sater had his criminal file sealed and received only a $25,000 fine even though his scheme netted $40 million.

Sater’s name was publicly mentioned in a story in Business Week when he was first arrested in 1998 and his status as a cooperator was not too subtly referred to in a press release issued by the Eastern District U.S. Attorney’s Office two years later when 16 of the 19 defendants were charged. In a footnote to that press release, Sater was mentioned as one of three defendants who had pled guilty two years earlier. The press release has been published in the Congressional Record. Read the press release at pp. 194-95.

In 2007, the New York Times ran an article detailing some of Sater’s dealings as a real estate developer with Donald Trump, who now has the Republican nomination for President sewed up. The article also referred to statements from one the three 1998 defendants that Sater had cooperated with the prosecution. The third 1998 defendant also described Sater’s efforts to cut a deal with the government in a book published in 2003. Read the article.

In a March 21 article AP ran about its efforts to unseal the file before Cogan, the news wire wrote “even after learning about Sater’s background, Trump tapped Sater for a business development role in 2010 that included the title of senior adviser to Trump. Sater received Trump Organization business cards and was given an office within the Trump Organization’s headquarters, on the same floor as Trump’s own.”

At yesterday’s hearing, Cogan ruled that he would release all but 38 of the approximately 280 documents that had been filed since he was appointed as the judge to enforce prior court orders. Some of those documents are “invariably sealed,” Cogan said, such as presentencing reports and  prosecution letters to the court explaining why cooperators deserve a more lenient sentence because of their value to the prosecution. Should those documents become public, he explained, they can “compromise an ongoing investigation” and “endanger the safety of cooperators.”

Other sources, however, said that the remaining sealed documents include about a half dozen articles published in major newspapers.

Ominously for Oberlander and Lerner, Cogan said, “the prior injunctions stand” even though he was unsealing a large number of documents because of the “futility of keeping under seal” records that had already become public.

When Lerner asked Cogan whether he could be held in contempt for revealing the contents of the Eastern District’s 2000 press release even though it is now available in the Congressional Record, the judge curtly responded, “I don’t give advisory opinions.”

Cogan also said that he had made no findings relevant to whether Oberlander and Lerner should be held in contempt but had concluded that there is “a prima facie case” that contempt has occurred.

Meanwhile, the U.S. Attorney’s Office in Syracuse, which is now handling the criminal contempt investigation, seemed in no rush to reach a decision.

Cogan asked Assistant U.S. Attorney Stephen Green whether his office would be ready for a status conference on its investigation within 30 or 60 days. Green demurred with a barely audible, “We can’t commit.”

That being the case, Cogan set the hearing for 30 days hence—on June 15.

DanielJWise©2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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