Friday, August 28, 2009

August 28, 2009, 5:42 PM ET Sjoblom, Proskauer Rose Face Fallout From Stanford Affair
Wow. Plaintiffs’ lawyers work fast!

On Thursday, as we wrote, the former No. 2 executive at Stanford Financial Group pleaded guilty to aiding a multibillion-dollar Ponzi scheme and appeared to implicate Stanford’s outside lawyer, Tom Sjoblom, in a scheme to obstruct a Securities and Exchange Commission investigation into the firm.

Well, lo-and-behold, on the same day, several victims of the fraud filed a class-action lawsuit against Sjoblom (pictured) and his law firm, Proskauer Rose.

The suit, filed in federal court in Dallas, says Sjoblom and Proskauer are liable for $7 billion in damages for aiding and abetting Stanford’s alleged fraud.

According to a story by the NLJ’s Leigh Jones, Proskauer said in a statement that the lawsuit was “legally flawed and factually erroneous.” (Click here for the complaint and scroll to page 19 for the relevant allegations.) Sjoblom’s lawyer, James Cole, declined to comment. Sjoblom hasn’t been criminally charged with any wrongdoing.

The civil suit is largely based on a plea agreement that we mentioned in this post yesterday, which focuses in part of the alleged actions of Sjoblom, who became outside counsel for Stanford’s international bank, based in Antigua in the Caribbean, starting in 2005.

One of the first examples of alleged wrongdoing by Sjoblom and Proskauer involves a 2006 fax sent to Sjoblom by Leroy King, an Antigua banking regulator, whom prosecutors say was being bribed by Stanford to rubber-stamp Stanford’s activities. (King was criminally charged by U.S. prosecutors and could be extradited to the U.S.)

In the fax, King allegedly asked for Sjoblom’s help in crafting a response to a different Caribbean banking regulator who was asking about the firm. The lawsuit states: “Recognizing that he had already been paid through cash bribe payments from Stanford, King concluded the August 1, 2006 facsimile transmission with the following handwritten words: ‘Please do not bill me (laugh), Thanks a million, Lee.”

Let us offer up an observation: Judging from the outcome of a recent and slightly analogous situation, the claims against Proskauer might be a long shot.

In a separate recent case in which a partner at a major law firm was charged and convicted of aiding his client’s fraud, the firm so far hasn’t had to pony up cash, despite the best efforts of members of the plaintiffs’ bar. A former partner at Mayer Brown, Joseph Collins, was convicted earlier this year of helping to cover up fraud at his client, Refco Inc., a commodities broker. A story yesterday by AmLaw Litigation Daily notes that Mayer Brown “succeeded in beating back nearly every attempt to hold it liable in civil suits for the damage caused by Refco’s collapse” in 2005. The commodities broker had hidden $430 million in bad debts from the company’s auditors and investors.

1 comment:

  1. WOW - Somebody finally took my advice below and sued Proskauer in a Global Class Action Suit re Stanford!!! That makes two with the first suit filed by Stanford’s CIO Pendergest Holt. They will have to stand in line behind the Iviewit TRILLION dollar suit but…
    Foley & Lardner partner Patricia J. (Trish) Lane represented FISERV, sue Foley, read on.
    Investors who have been burned in these scams should start to seek redress from the lawyers who were involved with these scams. I personally have been trying to notify regulators and authorities of a ONE TRILLION DOLLAR scam that is putting states like New York and Florida at huge risk, as well as, companies like Intel, Lockheed, SGI and IBM. The states and companies involved in the fraud fail to acknowledge the risk exposing shareholders and citizens to impending liabilities. Investigators, courts and federal agents ignoring the crimes and evidence, including a car-bombing attempt on my life. I know how Harry Markopolos felt trying to expose Madoff in a world without regulation.
    Did I hear Proskauer Rose is involved in Madoff (involved many clients too) and acted as Allen Stanford’s attorney. Investors who lost money in these scams should start looking at the law firm Proskauer’s assets for recovery. First, Proskauer partner Gregg Mashberg claims Madoff is a financial 9/11 for their clients, if they directed you to Madoff sue them. Then, Proskauer partner Thomas Sjoblom former enforcement dude for SEC and Allen Stanford attorney, declares PARTY IS OVER to Stanford employees and advises them to PRAY, this two days before SEC hearings. Then at hearings, he lies with Holt to SEC saying she only prepared with him but fails to mention Miami meeting at airport hanger. Then Sjoblom resigns after SEC begins investigation and sends note to SEC disaffirming all statements made by him and Proskauer, his butt on fire. If you were burned in Stanford sue Proskauer.
    Proskauer Rose and Foley & Lardner are also in a TRILLION dollar FEDERAL LAWSUIT legally related to a WHISTLEBLOWER CASE also in FEDERAL COURT. Marc S. Dreier, brought in through Raymond A. Joao of Meltzer Lippe after putting 90+ patents of mine in his own name, is also a defendant in the Federal Case.
    The Trillion Dollar suit according to Judge Shira Scheindlin is one of PATENT THEFT, MURDER & A CAR BOMBING. For graphics on the car bombing visit [I-View-It]
    The Federal Court cases
    United States Court of Appeals for the Second Circuit Docket 08-4873-cv - Bernstein, et al. v Appellate Division First Department Disciplinary Committee, et al. - TRILLION DOLLAR LAWSUIT
    Cases @ US District Court - Southern District NY
    (07cv09599) Anderson v The State of New York, et al. - WHISTLEBLOWER LAWSUIT
    (07cv11196) Bernstein, et al. v Appellate Division First Department Disciplinary Committee, et al.
    More @ [Expose Corrupt Courts]
    Eliot I. Bernstein
    Mad Inventor
    [Iviewit Blog]
    [Eliot Blog]