EFTA00729404

IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA JEFFREY EPSTEIN, Complex Litigation, Fla. R. Civ. Pro. 1.201 CASE NO. Plaintiff, 50 2009 CA 0 b 0 3 MOUE v. 4) SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and M., individually, COPY RECEIVED FOR HUNG Defendants. DEC u ( 2008 sriesnoN Ii poCK COMPLAINT pLefitt Elk COMPTRQw-liti CIRCUIT CIVIL olvisiON Plaintiff, JEFFREY EPSTEIN, (hereinafter "EPSTEIN"), by and through his undersigned attorneys, files this action against Defendants, SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and E., 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 EFTA00729404 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 payment from Epstein. The misconduct featured the filing of legal motions and the pursuit of a civil litigation strategy that was unrelated to the merits or value of their clients' cases and, instead, had as its improper purpose the furthering of Rothstein'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 clients who were adversely affected by the misconduct that is the subject of this Complaint. Plaintiff 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. EFTA00729405 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 County, Florida. 4. At all times relevant hereto, ROTHSTEIN was the managing partner and CEO of RRA. 5. Defendant, ROTHSTEIN and Stuart Rosenfeldt, 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, M. ("M."), is an individual residing in Palm Beach County, Florida. At all times relevant hereto, 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 EFTA00729406 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 33401. In addition to its principal office, RRA also maintained seven offices in Florida, New 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 33009-8515. RRA, through its attorneys, including those named as Defendants herein, conducted business throughout Florida, and relevant to this action, conducted business and filed lawsuits on behalf of clients in Palm Beach County, Florida. (RRA is currently a debtor in bankruptcy. RRA is not named as a Defendant). 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 who was the chief executive officer and chairman of RRA. Within the information which was filed, the United States of America has identified the enterprise as being the 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 EFTA00729407 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 investigation on cases, including Epstein-related matters, would in all likelihood would not have been sustainable. A copy of the information is attached as Exhibit 1 to this action. 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. EFTA00729408 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 evidenced by the filing of Amended Complaint For Dissolution And For Emergency Transfer of Corporate Powers to Stuart A. Rosenfeldt, Or, In The Alternative, For the Appointment of A Custodian or Receiver by ROSENFELDT, and RRA, against ROTHSTEIN, individually. (Case No. 09 059301, In the Circuit Court of the Seventeenth Judicial Circuit, Broward County, Florida, Complex Business Div.), (hereinafter "RRA dissolution action, and attached hereto as Exhibit 2). 13. Plaintiff references the RRA dissolution action for the sole purpose that it acknowledges that RRA and ROTHSTEIN were in fact conducting an illegal and improper investment or Ponzi scheme based on promises of financial returns from settlements or 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 EFTA00729409 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.S. District Judge, Kenneth A. Marra and U.S. Circuit Court Judge, Susan H. Black, 11th Circuit in other cases. It is not yet known if he forged similar documents in Esptein related matters. See Composite 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. FIa.)(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, v. Epstein, Case No. 502008CA028051XXXXMB AB;.. v. Epstein, Case No. 502008CA028058XXXXMB EFTA00729410 Epstein v. RRA, et al. Page 8 AB), (hereinafter collectively referred to as the "Civil Actions," and El 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 convinced it was all a Ponzi scheme and I notified the FBI in detail how Scotty ROTHSTEIN was hiding behind a legitimate law firm to peddle fake investments? Attorney Sakowitz 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 EFTA00729411 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 Boden, Debbie 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/clients that existed or RRA had against EPSTEIN and the value thereof. They would show and share actual case files from the EPSTEIN actions with hedge fund managers. 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 anonymously against Epstein and had opposed disclosure of her legal name. 23. In all other instances, 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. EFTA00729412 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 El 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 massive Ponzi scheme and/or were selling an alleged interest or investment in the Civil Actions (and other claims) involving Epstein. 27. Further evidencing that EDWARDS (and 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. 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, EFTA00729413 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, while his partner Rosenfeldt received greater than $6 million in 2008. 28. ROTHSTEIN attempted to lure the entity known as D3 Capital Club, LLC, ("D3"), by offering D3 the opportunity" to invest in a pre-suit $30,000,000.00 court settlement against EPSTEIN; yet this supposed settlement never existed 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 substantiate that the claims against EPSTEIN were legitimate and that the evidence obtained against him by RRA, ROTHSTEIN, and EDWARDS (the "Litigation Team") was real. 29. Upon information and belief, ROTHSTEIN 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) and Jenne (a former attorney, Broward County Sheriff and felon) assisted ROTHSTEIN in making these offers by providing confidential, privileged and work- product 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. EFTA00729414 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 with the sale of an interest in non- settled personal injury lawsuits (which are non-assignable and non- transferable) or sold non-existent structured 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., M., . 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 state or federal laws and Bar rules; and e. Utilized 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, EFTA00729415 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 the scheme, ROTHSTEIN used RRA's Litigation Team in the EPSTEIN cases to pursue issues and evidence unrelated to and unnecessary to the claims pled in the Civil Actions, but significantly beneficial to lure investors into the Ponzi scheme orchestrated by ROTHSTEIN and other co-conspirators. 34. Upon information and belief, ROTHSTEIN and others claimed their investigators discovered that there were high-profile individuals onboard 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.., ■., and Jane Doe (RRA clients) as it related to EFTA00729416 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 for the purposes of "pumping" the cases and thus by using the depositions to sell the cases (or a part of them) to third parties. 37. Because of these facts, ROTHSTEIN claimed that Epstein wanted to make certain none of these individuals would be deposed and therefore he had offered $200,000,000.00 to settle the claims of RRA female clients various potential plaintiffs in actions against EPSTEIN. The offer of a $200 million dollar settlement by EPSTEIN was completely fabricated; no such offer had ever been 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 Dershowitz (noted Harvard Law professor, constitutional attorney and one of EPSTEIN'S criminal defense attorneys); (iii)Bill Clinton (Former President of the United States); (iv)Tommy 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, .,■. or Jane Doe. EFTA00729417 Epstein v. RRA, et al. Page 15 40. EDWARDS filed amended answers to interrogatories in the state court matters, and.., 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 depositions or listing high profile friends/acquaintances as potential witnesses was, again, to °pump' the cases to investors. There is no evidence to date that any of these individuals had or have any knowledge regarding RRA's Civil Actions. 42. In furtherance of their illegal and fraudulent scheme against EPSTEIN, ROTHSTEIN, EDWARDS (who either know or should have known) and, at times, in her Civil Action against EPSTEIN: a) Included claims for damages in Jane Doe's federal action in excess 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. EFTA00729418 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 conduct completely irrelevant discovery unrelated to the claims in or subject matter of the Civil Actions for the purpose of harassing and embarrassing witnesses and EPSTEIN and causing 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. e) After EDWARDS was recruited and joined RRA in the spring of 2009, 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 "What the evidence is really going to show is that Mr. Epstein — at least dating back as EFTA00729419 Epstein v. RRA, eta!, 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 people working underneath him that he is paying well to schedule these appointments, to locate these girls." f) As an example, EDWARDS filed an unsupportable and legally deficient Motion for Injunction Restraining Fraudulent Transfer of Assets, Appointment of a Receiver to Take Charge of Property of Epstein, and to Post a $15 million Bond to Secure Potential Judgment, in Jane Doe v. Epstein Case No. 08-CV-80893- Marra/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. g) ROTHSTEIN told investors he had another 52 females that he represented, and that Epstein had offered $200 million to resolve, EFTA00729420 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) — testified she never had any type of sex with Epstein; worked at numerous strip clubs; is an admitted prostitute and call girl; has a history of illegal drug use (pot, painkillers, Xanax, Ecstasy); and continually asserted the 5th Amendment during her depositions in order to avoid answering relevant but problem questions for her; - testified she worked at eleven (11) separate strip clubs, including which RRA represented and in which ROTHSTEIN may have owned an interest; and.. also worked at 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. Jane Doe (federal case) seeks $50 million from Epstein. She and her attorneys claim severe EFTA00729421 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 well prior to meeting Epstein as a result of having witnessed her father murder his girlfriend's son. She was required to give sworn testimony in that matter and has admitted that she has lied in sworn testimony. Jane Doe worked at two different strip clubs, including in Boynton Beach. i) Conducted ridiculous and irrelevant discovery such as subpoenaing records from an alleged sex therapist, Dr. Leonard Bard in Massachusetts, when the alleged police report reflected that 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; j) Allowed a Second Amended Complaint to be filed on behalf of ■. alleging that EPSTEIN forced the minor into "oral sex," yet testified that she never engaged in oral, anal, or vaginal EFTA00729422 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. Why? Again, to prime the investment "pump" with new money without any relevance to the existing claims made by the RRA clients. 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 knew the civil provisions in the agreement had no impact whatsoever 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." EFTA00729423 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 claims against EPSTEIN to potential investors. 45. As a result of the fraudulent investment or (Ponzi) scheme, RRA and its attorneys in the Civil Actions against EPSTEIN may have compromised their clients' 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 allegations and testimony in ■.'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 EFTA00729424 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 has now admitted, under oath, to being a call girl/escort since the age of 15. (in her deposition September 24, 2009 Transcript "DT" 280:16-19). She testified "Well, I lived life as a prostitute," (see DT 156:7) and "I am a prostitute when I make money" (see DT 156:12-13). ■. admitted her activity with men other than Epstein to making $1,000 a day from prostitution on maybe more than 20 occasions in one year alone (DT 157:11-158:21). ■. admitted under oath to keeping a list of amounts she collected from "Johns" in "two or three" lined books including a book of "Psalms" that she obtained from a religious store (DT 152:1-14). Under the circumstances, her claim for damages against EPSTEIN, one of ■.'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, gave swom 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 M.'s civil action against Epstein is now based. However, once in the hands of EFTA00729425 Epstein v. RRA, et al. Page 23 EDWARDS and RRA, Ill's story changed dramatically. All of a sudden she wanted to ■ EPSTEIN and like other RRA clients, sought tens of millions of dollars. a. For example, in her sworn statement to the FBI, 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). In fact, fi spoke so highly of EPSTEIN and her interactions with him that the US Attorney's office informed a federal court in July 2008 that the US Attorney could not consider IS a victim. Yet, by September 24, 2009, the date on which ■. began her deposition in her civil action and now represented by RRA and EDWARDS, ■.'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, ■. declared that: 1, 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) EFTA00729426 Epstein v. RRA, et al. Page 24 "You don't think my whole life I have lived that shitty life because of Jeffrey Epstein?" (DT 222:7-8) b. In her sworn FBI testimony (pre-EDWARDS and RRA), was emphatic that her interactions with Epstein involved no inappropriate sexual touching in any way. In fact, it was exactly the opposite: O: Did he at any point kiss you, touch you, show any kind of affection towards you? A: Never, never. (p. 21 — FBI) . . . Q: So he never pulled you closer to him in a sexual way? A: I wish. No, no, never, ever, ever, no, never. Jeffrey is an awesome man, no. (p. 21 - FBI) Yet, ■. filed her second amended complaint in April 2009, after EDWARDS joined RRA, the allegations against EPSTEIN in ■.'s complaint became even more salacious. In paragraph 12 of M.'s Second Amended Complaint, 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..." EFTA00729427 Epstein v. RRA, et al. Page 25 c. In her sworn FBI statement (pre-EDWARDS and RRA),Ill. testified that MI, the individual who first brought M. to EPSTEIN's home, told II. "make sure you're 18 because Jeffrey doesn't want any underage girls." (p. 8 - FBI). Yet at her September, 2009 deposition now represented by EDWARDS and RRA,.. told a very different story: O: My question was what did tell you to tell Mr. Epstein about your age? A: She said it didn't matter. Q: 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,.. testified to the FBI : "I always made sure — I had a fake ID, anyways saying that I was 18." (p. 8 - FBI). Yet, when questioned about her fake ID at her September 2009 depo, she stated: Q: And did you have a fake ID? A: No. Q: Have you ever had a fake ID? EFTA00729428 Epstein v. RRA, et al. Page 26 A: No. (DT 300:5-8) e. In her FBI statement (pre-EDWARDS and RRA), testified about others brought to the Epstein home. 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 they'd call me. They'd beg me, you know, for us to go to house because they love Jeffrey. Jeffrey is a respectful man. He really is. I mean, and he all thought we were of age always. This is what's so sad about it. (p 30 - FBI). Q: Did any of the girls complain about what happened after they left there? A: No. You asked me that question. No, everybody loved Jeffrey. (p. 44 - FBI) A: Every girl that I brought to Jeffrey, they said they were fine with it. and like for example a. - 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) EFTA00729429 Epstein v. RRA, et al. Page 27 Yet, with EDWARDS and RRA as her attorneys, 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 and said M. don't ever do this to me again. That was the worst thing 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 of the dramatic changes made in her testimony prior to her representation by EDWARDS/RRA and after she hired ROTHSTEIN, EDWARDS and RRA. 48. As a result of the fraudulent investment or (Ponzi) scheme, may knowingly have compromised her alleged interests in her Civil Action, or committed a fraud on the court. 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. EFTA00729430 Epstein v. RRA, et al. Page 28 Fortunately, their tactics have not been successful. As Magistrate Judge Linnea 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." In addition, in an Omnibus Order dated October 28, 2009 (DE 377 in Federal Case #08-80119) Magistrate Judge Linnea wrote: "Here the request at issue goes to the very heart of the Plaintiffs damage claims, requesting not only general information relating to Plaintiff's 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 EFTA00729431 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 Complaint. To deny Epstein thus discovery, would be tantamount to barring him from mounting a defense." 50. ROTHSTEIN, EDWARDS and M.'s actions constitute a fraud upon EPSTEIN as RRA, ROTHSTEIN and the Litigation Team represented themselves to be acting in good and with the bests interests of their 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 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 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 EFTA00729432 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 El 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 scope of the fraudulent and criminal or racketeering activity so permeated the RRA law firm that EPSTEIN has been prevented from fully and fairly defending the civil actions brought against him. In essence, the very existence of RRA was based 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 ■. are liable for damages caused to EPSTEIN — individually, and jointly and severally. Count I — Violation of O772.101, et seq., 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. EFTA00729433 Epstein v. RRA, et al. Page 31 55. RRA, ROTHSTEIN, EDWARDS and U. each and collectively constitute an enterprise pursuant to §772.102(3), Fla. Stat. (2009). 56. ROTHSTEIN, EDWARDS and 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 multiple 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 (which includes Chapter 831, relating to forgery; §836.05, relating to extortion (which includes M.); and Chapter 837, relating to perjury (which includes ■.). Substantially more than two predicate 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 ■.'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 4O95.01, et seq., Fla. Stat. (20091, Against All Defendants EFTA00729434 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 each and collectively, constitute an enterprise pursuant to §895.02(3), Fla. Stat. (2009). 62. During all times relevant hereto, ROTHSTEIN, EDWARDS and were and are associated with the enterprise, RRA, and each other. 63. Defendants, ROTHSTEIN, EDWARDS and■., as persons 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 ROTHSTEIN, EDWARDS and, potentially, racketeering activity continues to be investigated by the FBI, as numerous civil lawsuits against some of the Defendants and 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. 65. Substantially more than two predicate acts (i.e., the selling 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. 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 M.) generally; EFTA00729435 Epstein v. RRA, et al. Page 33 Chapter 813, relating to forgery; §836.05, relating to extortion (including M.); Chapter 837, relating to perjury (including 67. Pursuant to §895.05, Fla. Stat., Plaintiff seeks the following relief against Defendants, ROTHSTEIN, EDWARDS and■.: a) Ordering ROTHSTEIN and EDWARDS to divest themselves of any interest in the enterprise, RRA; b) Enjoin all Defendants from engaging in the same type of conduct and activities as described herein; and c) Temporarily enjoining ROTHSTEIN, EDWARDS and ■., from the continuation of the Civil Actions 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 Ill — Abuse of Process — Against All Defendants 69. Plaintiff realleges and incorporates paragraphs 1 through 53 as if fully set forth herein. EFTA00729436 Epstein v. RRA, et al. Page 34 70. After instituting the Civil Actions against EPSTEIN, the actions of Defendants, ROTHSTEIN, EDWARDS and as alleged in paragraphs 9 through 53 herein, constitute an illegal, improper or perverted use of process. 71. ROTHSTEIN, EDWARDS and ■. possessed ulterior motives or purposes in exercising such illegal, improper, or perverted use of process. 72. As a result of ROTHSTEIN, EDWARDS and actions, EPSTEIN suffered damages. WHEREFORE, Plaintiff EPSTEIN respectfully demands the entry of a judgment for damages against all the named Defendants. Count IV — Fraud Against All Defendants 73. Plaintiff realleges and incorporates paragraphs 1 through 53 as if fully set forth herein. 74. ROTHSTEIN, by and through Defendant EDWARDS and M. made false statements of fact to EPSTEIN and his attorneys and agents, known to be false at the time made, and/or intentionally concealed material information from EPSTEIN and his attomeys 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. EFTA00729437 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 74 and 75 as if fully set forth herein. 77. ROTHSTEIN, EDWARDS and.. conspired to commit a fraud upon EPSTEIN. 78. ROTHSTEIN, EDWARDS and ■. combined by and through concerted action as detailed herein to accomplish an unlawful purpose or accomplish 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 unlawful means includes, but is not limited to, the use of the Civil Actions against EPSTEIN in an unlawful, improper, and fraudulent manner. 79. As a direct and proximate result of ROTHSTEIN, EDWARDS and ■.'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 ►. CRITTON, JR., ESQ. Florida r No. 224162 EFTA00729438 Epstein v. PIRA, et al. Page 36 MICHAEL J. PIKE, ESQ. Florida Bar #617296 BURMAN, CRITTON, LUTTIER & COLEMAN 303 Banyan Blvd., Suite 400 West Palm Beach, FL 33401 561-842-2820 Fax: 561-253-0154 (Attorneys for Plaintiff) EFTA00729439 Case 0:09-cr-60331-J1C Document 1 Entered on FLSD Docket 12/01/2009 Page 1 of 36 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NO9 at 60 3 1 CF - COHN mis,OkstRA*1b JUDS41 18 U.S.C. §1962(d) egiant 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(aX1) 18 U.S.C. §981(aXI)(C) UNITED STATES OF AMERICA, FILED by D.C. Plaintiff; DEC 0 1 2009: v. STEVEN M. LARIMORE CLERK U. S. DIST. CT. S. D. of - FT. LAUD. SCOTT W. ROTHSTEIN, Defendant. INFORMATION nt to this Information: The United States Attorney charges that, at all times releva GENERAL ALLEGATIONS in Florida. Defendant 1. Scott W. Rothstein was an attorney admitted to practice law man of Rothstein, Rosenfeldt and Adler, Rothstein was the Chief Executive Officer (CEO) and Chair P.A. offices located at 401 East 2. Rothstein, Rosenfeldt and Adler, P.A. was a law firm with here. The law fine employed approximately Las Olas Boulevard, Fort Lauderdale, Florida and elsew of law involving a wide range of specialties, seventy (70) attorneys and engaged in the practice including labor and employment law. EXHIBITS_ ri 1279n evJs,ita:4~. EFTA00729440 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 2 of 36 COUNT 1 (Racketeering Conspiracy, 18 U.S.C. §1962(d)) 1. The General Allegations ofthis 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 referred to as RRA) was a legal entity organized under the laws of the State of Florida and constituted an Enterprise as that term is defined in Tide 18, United States Code, Section 1961(4). The Enterprise engaged in, and the activities of which affected, interstate and foreign commerce. THE RACKETEERING CONSPIRACY 3. From in or about 2005 and continuing through in or about November 2009, in the Southern District of Florida and elsewhere, the defendant, SCOTT W. ROTHSTEIN, being a person employed by and associated with the Enterprise described above, which was engaged in, and the activities of which affected, interstate and foreign commerce, did knowingly combine, conspire, confederate, and agree, with persons known and unknown to the United States Attorney, directly to violate Title 18, United States Code, Section 1962(c); that is, to conduct and participate, and indirectly, in the conduct of the affairs o f the Enterprise through a pattern of racketeering activity as that term is defined in Title 18, United States Code, Sections 1961(1) and (5), as set forth herein below at paragraph 4. 2 EFTA00729441 Case 0:09-cr-60331-JIC Document 1 Entered on FLED Docket 12/01/2009 Page 3 of 36 THE PATTERN OF RACKETEERING ACTIVITY Code, 4. The pattern of racketeering activity as defined in Title 18, United States nspirators agreed to Sections 1961(1) and 1961(5), through which the defendant and his co-co s of the Enterprise conduct and participate, directly and indirectly, in the conduct of the affair ly: consisted of multiple acts indictable under the laws of the United States, name i. Title 18, United States Code, Section 1341 (mail fraud); ii. Title 18, United States Code, Section 1343 (wire fraud); monetary iii. Title 18, United States Code, Section 1956(8)(1) (laundering of instruments); in monetary iv. Title 18, United States Code, Section 1957 (engaging transactions); and to launder v. Tide 18, United States Code, Section 1956(h) (conspiracy . monetary instruments and engage in monetary transactions ACTIVITY THE PURPOSE AND OBJECT OF THE RACKETEERING to generate money for the 5. The principal purpose of the racketeering conspiracy was the Enterprise and through various defendant and his co-conspirators through the operation of y laundering. criminal activities, including mail fraud, wire fraud, and mone e in a pattern of racketeering 6. The defendant and his co-conspirators agreed to engag The conspirators also utilized other activity through its base of operation at the offices of RRA. was utilized by the defendant and his co- locations to further the objectives of the Enterprise. RRA from investors by fraud in connection conspirators to unlawfully obtain approximately $1.2 billion "Pond" scheme, in which new investors' funds with an investment scheme commonly known as a 3 EFTA00729442 et 12/01/2009 Page 4 of 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Dock legitimate investment are utilized to pay previous investors in the absence of any underlying security, vehicle or other commodity. THE ROLES AND RESPONSIBILITIES OF THE CONSPIRATORS 7. The roles of the conspirators were as follows: and CEO of RRA. A. Defendant SCOTT W. ROTHSTEIN was a shareholder, Chairman ted, managed, and supervised the Through his position at RRA, defendant ROTHSTEIN promo ors through the use of false administration of the Enterprise by fraudulently inducing invest y to purported borrowers based upon statements, documents, and computer records to (I) loan mone (2) invest funds bascd upon anticipated fraudulent promissory notes and fictitious bridge loans, and which had been reached between and pay-outs from purported confidential settlement agreements ent agreements were falsely presented among certain individuals and business entities. These settlem cases and putative defendants based upon as having been reached between putative plaintiffs in civil r whistle-blower cases. the forbearance of civil claims in sexual harassment and/o d States Attorney, agreed with B. Other conspirators, known and unknown to the Unite actions to further the operation and success one another and with defendant ROTHSTEIN to take aid investments to potential investors as of the "Pone scheme, including presenting the afores not; fraudulently inducing investors to place legitimate investment vehicles, when in fact they were misstatements of facts as set forth below; funds into these investment vehicles by making material ient funds existed to pay returns on these assuring potential investors and investors that suffic creating, and transferring funds into and from, investments, when in fact such funds did not exist; to further the unlawful scheme; and realizing various accounts at financial institutions in order 4 EFTA00729443 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 5 of 36 of money generated as profits from the operation of the Ponzi scheme through the acquisition nal property. proceeds from the scheme and through the acquisition of real and perso CY MANNER AND MEANS OF THE RACKETEERING CONSPIRA a conspirator would 8. It was part of the conspiracy that the defendant agreed that affairs of the Enterprise. commit at least two acts of racketeering activity in the conduct of the the criminal conduct 9. Defendant ROTHSTEIN and other co-conspirators initiated themselves and to supplement the alleged in the instant Information in order to personally enrich income and sustain the daily operation of RRA. lently solicited investors 10. Defendant ROTHSTEIN and other co-conspirators fraudu to and from purported clients of RRA. to loan money based upon promissory notes and bridge loans RRA requested short-term financing for Defendant ROTHSTEIN falsely alleged that clients of alleged that the purported clients were undisclosed business deals. Defendant ROTHSTEIN falsely Defendant ROTHSTEIN. In fact, defendant willing to pay high rates of return on loans negotiated by for business financing actually existed. ROTHSTEIN was aware that no such clients or requests participated in an investment 11. Defendant ROTHSTEIN and other co-conspirators i" scheme involved the sale of purported scheme commonly known as a "Ponzi" scheme. The "Ponz ment and/or whistle-blower cases. The potential confidential settlement agreements in sexual harass co-conspirators that confidential settlement investors were told by defendant ROTHSTEIN and other rted settlements were allegedly available in agreements were available for purchase. The purpo s to millions of dollars and could be purchased amounts ranging from hundreds of thousands of dollar value over time. at a discount and repaid to the investors at face 5 EFTA00729444 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 6 of 36 and 12. Defendant ROTHSTEIN and other co-conspirators utilized the offices of RRA the legitimacy and success of the offices of other co-conspirators to convince potential investors of ment opportunity. the law firm, which enhanced the credibility of the purported invest and misleading 13. Defendant ROTHSTEIN and other co-conspirators made false induce potential investors into statements and omissions which were intended to fraudulently purchasing the confidential settlements. the following fraudulent 14. Defendant ROTIISTEIN and other co-conspirators made to purchase the purported settlements: representations to potential investors in order to induce them in order to protect the A. That the purported settlements were highly confidential and the executives reputation of the company authorizing the settlement involved; t and/or whistle-blower B. That the plaintiffs in the purported sexual harassmen to avoid the emotional cases preferred to settle the cases in order embarrassment of pursuing a claim in a public forum; internal staff and outside C. That RRA originated its own cases from reputation, referrals from other law firms; et sites and well-placed D. That RRA retained a company that owned intern e of high quality cases; "800" numbers designed to attract a large volum sexual harassment and/or E. That RRA rigorously screened the purported whistle-blower settlement agreements; 6 EFTA00729445 of 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 7 onnel and employed highly That RRA utilized former law enforcement pers pursuing claims against sophisticated investigative methods in selecting and purported defendants; d settlements with defendant G. That RRA or other law firms pursued purporte n; companies prior to the initiation of litigatio with the purported defendant H. That RRA or other law firms negotiated re of the alleged claim by the company after such company was made awa plaintiff; ortedly negotiated with the defendant I. That RRA or other law firms purp contained the settlement amount company and reached an agreement which and the payment terms; occurred prior to the initiation of J. That because the purported settlements ernmental entity involved in the litigation, there was no court or gov transaction; sent by wire transfer to RRA or other K. That the alleged defendant companies of the purported settlements; law firms' trust accounts the full proceeds n ce or other settlement negotiations whe L That during the settlement conferen nded payment schedule, RRA or other a purported plaintiff protested the exte a plaintiff with the option of receiving law firms presented the purported unrelated confidential funding source; discounted lump sum payment from an ent of irators prepared a purported Assignm M. That RRA or other co-consp stor agreed to acquire the right to the Settlement Agreement in which the inve 7 EFTA00729446 8 of 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLED Docket 12/01/2009 Page p sum payment made to purported settlement payments for a discounted lum the purported plaintiff; investor it immediately N. That when RRA received the payment by the ; and disbursed those funds to the purported plaintiff t to the purported payment O. That RRA made payment to the investor pursuan nt agreement. schedule set forth in the purported settleme irators falsely informed potential 15. Defendant ROTHSTEIN and other co-consp individual gnated trust accounts for the benefit of the investors that funds were maintained in desi n, by two on a regular basis, weekly if not more ofte investor and that these funds were verified ncial g an attorney and the other being an independent fina independent verification sources, one bein ependent verifiers"). advisor (hereinafter referred to "ind l coconspirators falsely informed potentia 16. Defendant ROTHSTEIN and other ional banking e maintained with a well established internat investors that RBA's trust accounts wer and regulatio ns of the Florida Bar, and that at:7.gs to institution, in accordance with the rules fiers. edly mon itored by one of the two independent veri balances in the trust accounts was alleg l co-conspirators falsely informed potentia 17. Defendant ROTHSTEIN and other undertaken with the following provisions: investors that due diligence would be permitted to ask questions of Defendant A. An "independent verifier" would be irators to review the opportunity and ROTHSTEIN and/or other co-consp structure; e the opportunity to randomly review B. The independent verifier" would hav firm the veracity of the information; selected completed transactions to con 8 EFTA00729447 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 9 of 36 d current transactions, C. The "independent verifier" had already reviewe ndants and payments made to including wire transfers received from defe plaintiffs; opportunity to visit and speak D. The "independent verifier" would have the ch of the financial institution to with a senior banking officer at the local bran nces through bank statements confirm current trust account bank bala provided on line; and nity to meet with a senior banking E. The "independent verifier" had the opportu e "locked" and to verify the officer to verify that the trust accounts wer relationship with the bank. strength of RBA's financial position and t co-conspirators established numerous trus 18. Defendant ROTHSTEIN and other cy ince pote ntial and current investors of the legitima accounts in the name of RBA in order to conv . nts and the security of such investments of the confidential settlement agreeme bank onspirators prepared and used altered 19. Defendant ROTHSTEIN and other co-c l institution, to well-established international financia statements, purportedly issued from a investors that funds had been received from the purported fraudulently convince potential and current ned in trust accounts. defendant companies and were maintai rs t ROTHSTEIN and other co-conspirato 20. In order to deceive investors, defendan purported trust onli ne banking information regarding the created, altered and/or maintained fictitious , the receipt of unt of funds maintained in such accounts accounts which falsely reflected the amo the nt companies and the transmission of funds by wire to funds wired from the alleged defenda alleged plaintiffs, 9 EFTA00729448 Case 0:09-cr-60331-JIC Document 1 Entered on F LSD Docket 12J01/2009 Page 10 of 36 irators created false and fictitious 21. Defendant ROTHSTEIN and other co-consp nts and agreements, assignment of settlement agreeme documents, including confidential settlement ng onal guaranties by Defendant ROTHSTEIN, amo proceeds, sale and transfer agreements, and pers other documents. irators facilitated the movement and 22. Defendant ROTHSTEIN and other co-consp in order to erous trust accounts and operating accounts transfer of funds between and among num were available transfer of such funds insured that monies perpetuate the scheme. The movement and s. to make scheduled payments to investor in the individual trust accounts in order current onspirators made false statements to 23. Defendant ROTHSTEIN and other co-c settlement re-invest in additional purported confidential investors in order to convince them to agreements. and onspirators facilitated the creation of false 24. Defendant ROTHSTEIN and other co-c trust ed by an executiv e at the financial institution where the fictitious "lock letters" which were issu funds unts wer e mai ntai ned . Suc h "loc k letters" falsely reflected that the and operating acco investors. would only be disbursed to specific maintained in specific trust accounts ived from co-conspirators utilized funds rece 25. Defendant ROTHSTEIN and other on investment" to earlier investors. investors to pay the promised "return a co-consp irators also initiated and conducted 26. Defendant ROT1ISTEIN and other ts had order to perp etuate the "Ponzi" scheme. Such clien scheme to defraud clients of RRA in led the lawsuit l lawsuit . Unknown to the clients, RRA sett retained RRA to institute and file a civi mit the fraud and deceive 0 to the defendant. In order to com and obligated the clients to pay $500,00 court and other co-consp irators created a false and fraudulent the clients, defendant ROTHSTEIN 10 EFTA00729449 of 36 se r-6 03 31 -JI C Do cum en t 1 En ter ed on FLSD Docket 12/01/2009 Page 11 Ca 0:09-c t the clients had l District Co urt Judge which falsely alleged tha order purportedly signed by a Federa t tely $23 million. The fraudulen owed a judgement of approxima prevailed in the lawsuit and were order the defendant had transfe rred funds to the Cayman Islands in court order also falsely stated that to avoid paying the judgement. the clients on er co-conspirators falsely advised 27. Defendant ROTHSTEIN and oth ds, they had to post bonds to be held recover the defendant's fun several occasions that in order to sed dant ROTHSTEIN and other coconspirators fraudulently cau in the RRA trust account Defen t controlled tely $57 million ove r several years to a trust accoun the clients to wire transfer approxima portedly to satisfy the bonds. by defendant ROTHSTEIN, pur ds transmitted by other co-conspirators caused the fun 28. Defendant ROTHSTEIN and e perpetuate the "Ponzi" schem A trust accounts in order to the clie nts to be transferred to other RR terprise. rs who we re associated with the En and to enrich those co-conspirato clients as other co-con spirators were questioned by the 29. Defendant ROTHSTEIN and nts, defendant suit. In order to delay the return of funds to the clie to the progress of the alleged law ed by a United States ated a false Federa l court order purportedly issu ROTHSTEIN fraudulently cre a later date_ ering RRA to return the transmitted funds by Magistrate Judge allegedly ord through other co-conspi rators utilized funds obtained 30. Defendant ROTHSTEIN and and RRA nt and support the operati on and activities of RRA, to exp the "Ponzi" scheme to suppleme and to acquire rneys and support staff, to fund salaries and bonuses, by the hiring of additional atto enrich the personal wealth of and equipment in order to larger and more elaborate office space ociated with the Enterprise. persons employed by and ass 11 EFTA00729450 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 12 of 36 gally obtained er co-conspirators utilized funds ille 31. Defendant ROTHSTEIN and oth te and federal political make politic al contributions to local, sta through the "Ponzi" scheme to te to conceal the true source of such funds and to circumvent sta candidates, in a manner designed itations and contribution of such funds. and federal laws governing the lim ations in order er co- conspirators used other corpor 32. Defendant ROTHSTEIN and oth funds utilized from the "Ponzi" sch eme to conceal the source of the to launder proceeds generated " scheme. in order to promote the "Ponzi to make political contributions yees other co-conspirato rs paid large bonuses to emplo 33. Defendant ROTHSTEIN and bonuses, the ard for exe mp lary wo rk. Prior to the receipt of the of RRA purportedly as an aw employees' to ma ke larg e con trib utio ns to political candidates in the employees were instructe d on and to illegally wa s des ign ed to con cea l the true source of the contributi names. Such conduct laws. circumvent campaign finance luding other co-conspirato rs distributed lavish gifts inc 34. Defendant ROTHSTEIN and order to uals and members of RICA in cash and bonuses to individ exo tic cars, jewelry, boats, loans, firm. alty and to cre ate the app earance of a successful law engender goodwill and loy de large charitable dan t RO TH ST EIN and other co-conspirators ma 35. Defen ate rita ble ins titu tion s, inc lud ing hospitals and other legitim vate cha contributions to public and pri the "Ponzi" scheme. and non pro fit org ani zat ion s using funds derived from charitable illegally obtained t RO TH ST EIN and oth er co-conspirators utilized funds 36. Defendan portedly to provide sch em e to hir e me mb ers of local police departments pur through the "Ponzi" were TH ST EIN 's per son al res ide nce. "Ponzi" scheme funds RO security for RRA and defendant ry favor h ran kin g me mb ers of pol ice agencies in order to cur ies to hig also used to provide gratuit 12 EFTA00729451 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 13 of 36 rcement scrutiny of the activities of RRA and with such police personnel and to deflect law enfo defendant ROTHSTEIN. rs utilized funds obtained through 37. Defendant ROTHSTEIN and other co-conspirato thern ing interests in restaurants located in the Sou the "Ponzi" scheme in order to purchase controll e in part as a mec hanism to give gratuities to District of Florida. Such restaurants wer used dwill and ciates and attorneys, in order to foster goo individuals, including politicians, business asso tings. s and as a secure location for conspiratorial mee loyalty, as a location to solicit potential investor onspirators associated with affluent and 38. Defendant ROTHSTEIN and other co-c me. r to lure wealthy investors into the "Ponzi" sche politically connected individuals in orde sports onspirators associated with well known 39. Defendant ROTHSTEIN and other co-c riety and to and elsewhere, in order to gain greater noto figures and politicians, in public forums legitimacy. Such acts were calculated in part to enhance create the appearance of wealth and potential investors in the "Ponzi" scheme. defendant ROTHSTEIN's ability to solicit the onspirators used funds derived from 40. Defendant ROTHSTEIN and other co-c ng expensive real nce of affluence and wealth, by purchasi "Ponzi" scheme to maintain the appeara of RRA and of the e potential investors of the legitimacy and personal property, in order to convinc erty, endant ROT HSTEIN purchased expensive real prop purported investment opportunities. Def lth. vessels, vehicle s and other indicia of success and wea personal property, business interests, States Code, Section 1962(d). All in violation of Title 18, United 13 EFTA00729452 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 14 of 36 COUNT 2 )) (Money Laundering Conspiracy, 18 U.S.C. §1956(h ugh 40 of Count 1 of the Information 1. The General Allegations and paragraphs 5 thro e. arc realleged and incorporated herein by referenc Bank) was a commercial bank with 2. TD Bank, N.A., (hereinafter referred to as TD e ga branch office in Weston, Florida. The executiv branch offices in thirteen (13) states, includin endant land, Maine and Cherry Hill, New Jersey. Def offices of TD Bank were located in Port mately thirty-eight (38) bank accounts at TD Bank, ROTHSTEIN and RRA maintained approxi the "Po nzi" scheme. which were utilized during the course of fter referred to as Gibraltar Bank) was a 3. Gibraltar Private Bank and Trust (hereina derdale, offices, including a branch office in Fort Lau commercial bank with seven (7) branch Gibraltar mai ntained at least four (4) bank accounts at Florida. Defendant ROTHSTEIN and RRA rse of the "Ponzi" scheme. Bank, which were utilized during the cou 9, eafter through in or about November 200 4. From in or about 2005 and continuing ther ndant, rict of Florida and elsewhere, the defe in Broward County, in the Southern Dist SCOTT W. ROTHSTEIN, to the United and agre e with persons known and unknown did knowingly conspire, confederate, United States the United States in violation of Title 18, States Attorney, to commit offenses against is: Code, Sections 1956 and 1957, that mpt to conduct financial transactions i. to knowingly conduct and atte ified , which involved the proceeds of a spec affecting interstate and foreign commerce Uni ted wfu l acti vity , that is, mai l frau d and wire fraud, in violation of Title 18, unla on of with the intent to promote the carrying States Code, Sections 1341 and 1343, atte mpt ing to and that while conducting and said specified unlawful activities, the finan cial knew that the property involved in conduct such financial transactions 14 EFTA00729453 D Docket 12/01/2009 Page 15 of 36 Case 0:09-cr•60331-JIC Document 1 Entered on FLS of unlawful activity in violation transaction represented the proceeds of some form (1XAXi); of Title 18, United States Code, Section 1956(a) duct financial transactions ii. to knowingly conduct and attempt to con merce, which transactions involved affecting interstate commerce and foreign com , that is, mail fraud and wire fraud, in the proceeds of specified unlawful activity Sections 1341 and 1343, knowing that the violation of Title 18, United States Code, part to conceal and disguise the nature, transactions were designed in whole or in the proceeds of specified unlawful location, source, ownership, and control of attempting to conduct such financial activity, and that while conducting and lved in the financial transactions represented transactions, knew that the property invo activity, in violation ofTitle 18, United States the proceeds ofsome form of unlawful Code, Section 1956(aX1)(BXi); and engage, in monetary transactions by, iii. to knowingly engage and attempt to cting interstate and foreign commerce, in through or to a financial institution, affe having greater than $10,000, which property criminally derived property of a value d, activity, that is, mail fraud and wire frau been derived from a specified unlawful of e, Sections 1341 and 1343, in violation in violation of Title 18, United States Cod 1957. Title I8, United States Code, Section es Code, Section 1956(h). All in violation of Title 18, United Stat COUNT 3 18 U.S.C. §1349) (Mail and Wire Fraud Conspiracy, hs 5 thro ugh 40 of Count I of the Information 1. The General Allegations and paragrap reference. are realleged and incorporated herein by er 2009, thereafter through in or about Novemb 2. From in or about 2005 and continuing nt, District of Florida and elsewhere, the defenda in Broward County, in the Southern SCOTT W. ROTHSTEIN, federate, and agree with other persons known and unknown did knowingly combine, conspire, con Title 18, mit offenses agai nst the United States in violation of to the United States Attorney to com and 1343, that is: United States Code, Sections 1341 15 EFTA00729454 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 16 of 36 and intend to devise a i. to knowingly and with intent to defraud devise money and property from others by scheme and artifice to defraud and to obtain s, representations, and promises, means of materially false and fraudulent pretense when made, and causing to be delivered knowing that they were false and fraudulent interstate carrier, according to the certain mall matter by any private and commercial the scheme, in violation of Title 18, directions thereon, for the purpose of executing United States Code, Section 1341 aud devise and intend to devise a ii. to knowingly and with intent to defr in money and property from others by scheme and artifice to defraud and to obta , pretenses, representations, and promises means of materially false and fraudulent nt when made, and transmitting and knowing that they were false and fraudule munications in interstate and foreign causing to be transmitted by means of wire com ds, for the purpose of executing the commerce, certain signs, signals and soun es Code, Section 1343. scheme, in violation of Title 18, United Stat CONSPIRACY THE PURPOSE AND OBJECT OF THE and cy was to enrich defendant ROTHSTEIN 3. The purpose and object of the conspira money g money from investors and converting the investors' his co-conspirators by illegally obtainin scheme. ration of the above-described "Ponzi" to their own use and benefit through the ope es Code, Section 1349. All in violation of Title 18, United Stat COUNTS 4 and 5 (Wire Fraud, 18 U.S.C. §1343) tion hs 5 through 40 of Count 1 of the Informa 1. The General Allegations and paragrap by reference. are realleged and incorporated herein Miami- On or abo ut the dates enum erat ed as to each count below, at Broward and 2. nt, of Florida, and elsewhere, the defenda Dade Counties, in the Southern District SCOTT W. ROTHSTEIN, devise and intend to devise a scheme and artifice to defraud did knowingly and with intent to defraud frau dulent pretenses, others by means of materially false and and to obtain money and property from 16 EFTA00729455 Page 17 of 36 Entered on FLSD Docket 12/01/2009 Case 0:09-cr-60331-J1C Document 1 promises were false wing that such pretenses, representations, and representations, and promises, kno to the purpose of executing the scheme, transmitted and caused and fraudulent when made, and for particularly nications in interstate and foreign commerce, as more be transmitted certain wire commu described below: DATE WIRE COMMUNICATION COUNT TD Bank to December 2, 2008 Interstate wire transfer sent from 4 Gibraltar Bank TD Bank from JP October 16, 2009 Interstate wire transfer sent to 5 Morgan Chase 2. States Code, Sections 1343 and All in violation of Title 18, United TIO NS FORFEITURE ALLEGA this reference fully ation are realleged and by 1. The allegations of this Inform certain alleging forfeitures to the United States of America of incorp orated herein for the purpose of Rules of 7(eX2) and 32.2(a), Federal has an interest pursuant to property in which the defendant united States is being sought pursuant to the provisions of Title 18, Criminal Procedure. Forfeiture le 28, United (a) and 981(a)(1)(C), as made applicable hereto by Tit Code, Sections 1963(a), 982 States Code, Section 2461. 1 of the ense of RICO Co nspiracy set forth in Count 2. Upon conviction of the off ll for feit to the United States the OTT W. ROTHSTEIN, sha Inf ormation, the defendant, SC following property: maintaine d pursuant to Section 1962; i. Any interest acquired or or ty of, claim against, or property ii. Any interest in, securi over, the affording a source of influence contractual rights of any kind 17 EFTA00729456 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 18 of 36 ch was established, enterprise described in the Information whi to Title 18, United States operated, controlled and conducted pursuant Code, Section 1962; and from proceeds obtained iii. Any property constituting or derived vity pursuant to Title 18, directly and indirectly from racketeering acti United States Code, Section 1962. Laundering Conspiracy set forth in Count 3. Upon conviction of the offense of Money es all TT W. ROT HSTEIN, shall forfeit to the United Stat 2 of the Information, the defendant, SCO ude: eabl e to the offense which property shall incl property, real or personal, involved in or trac the subject of each i. all money and other property that was n and transfer in violation of transaction, transportation, transmissio Section 1956(h); erty constituting proceeds obtained ii. all commissions, fees and other prop as a result of those violations; and part to commit and to facilitate the iii. all property used in any manner and commission of those violations. d acy to Commit Mail Fraud and Wire Frau 4. Upon conviction of the offense of Conspir defendant, h in Counts 3, 4, and 5 of the Information, the and to Commit Wire Fraud as set fort onal, which to the United States, all property, real or pers SCOTT W. ROTHSTEIN, shall forfeit eable to the offense. constitutes or is derived from proceeds trac s to Title 18, United States Code, Section 5. The property subject to forfeiture, pursuant s but is not limited to: 1963, 982(a)(1) and 981(a)(1)(C), include 18 EFTA00729457 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 19 of 36 States currency. A. A sum of money equal to $1,200,000,000 in United B. Real Properties ("RI"): ida, hereafter also referred to as "Defendant (RI'1) 2307 Castilla Isle, Fort Lauderdale, Flor fixtures, attachments and casements RP1," includes all buildings, improvements, described as Lauderdale Shores found therein or thereon, and is more particularly o Number of 5042 12 13 0210; Reamen Plat 15-31 B Lot 2 Blk 5 with a Foli ida, hereafter also referred to as "Defendant (RP2) 2308 Castilla Isle, Fort Lauderdale, Flor ts, fixtures, attachments and easements RP2," includes all buildings, improvemen icularly described as: Lauderdale Shores found therein or thereon, and is more part a Folio Number of 5042 12 13 0020; Reamen Plat 15-31 B Lot 2 Blk 4 with fendant Florida, hereafter also referred to as "De (RP3) 2316 Castilla Isle, Fort Lauderdale, ts men ts, fixtures, attachments and easemen RP3," includes all buildings, improve icularly described as: Lauderdale Shores found therein or thereon, and is more part 12 13 1/2 Blk 4 with a Folio Number of 5042 Reamen Plat 15-31 B Lot 3 & Lot 4 W 0030; as "Defendant ale, Florida, hereafter also referred to (RP4) 30 Isla Bahia Drive, Fort Lauderd ts, fixtures, attachments and easements RP4," includes all buildings, improvemen ia 47-27 B e particularly described as: Isla Bah found therein or thereon, and is mor 2 13 16 0640; Lot 63 with a Folio Number of 504 as "Defendant ale, Florida, hereafter also referred to (RP5) 29 Isla Bahia Drive, Fort Lauderd ts men ts, fi xtures, attachments and easemen RP5," includes all buildings, improve 19 EFTA00729458 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 20 of 36 ribed as: Isla Bahia 47-27 B found therein or thereon, and is more particularly desc 0; Lot 35 with a Folio Number of 5042 13 16 036 derdale, Florida, hereafter also referred to as (RP6) 350 SE r d Street, Unit 2840, Fort Lau the condominium, improvements, "Defendant RP6," includes that portion of or thereon, and is more particularly fixtures, attachments and easements found therein t 2840 with a Folio Number of 5042 10 described as: 350 Las Olas Place Condo Uni AN 1490; as derdale, Florida, hereafter also referred to (RP8) 2133 Imperial Point Drive, Fort Lau rovements, fixtures, attachments and "Defendant R138," includes all buildings, imp is more particularly described as: Imperial easements found therein or thereon, and Folio Number of 4942 12 07 2020; Point 1 Sec 53-44 B Lot 1 I Blic72 with a ant Florida, hereafter also referred to as "Defend (RP9) 2627 Castilla Isle, Fort Lauderdale, ts ts, fixtures, attachments and easemen RP9," includes all buildings, improvemen res particularly described as: Lauderdale Sho found therein or thereon, and is more a Folio Number of 5042 12 13 0380; Reamem Plat 15-31 B Lot 22 Blk 5 with as Plantatio n, Florida, hereafter also referred to (RP10)10630 NW 141h Street, Apt. 110, ion of the condominiumftownhome, "Defendant RP10," includes that port is easements found therein or thereon, and improvements, fixtures, attachments and VILLAGE 1-"C" CONDO UNIT 201 more particularly described as: OPTIMA 31 AC 0110; BLDG 2 with a Folio Number of 4941 ale by the Sea , Florida, hereafter also referred to as (RP11) 227 Garden Court, Lauderd fixtures, ion of the buildings, improvements, "Defendant RP I I," includes that port 20 EFTA00729459 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 21 of 36 attachments and casements found therein or thereon, and is more particularly AS described as: SILVER SHORES UNIT A 28-39 B POR of Lot 4, BLK 5 DESC POB TO BEG AT SE COR SAID LOT 4, N 79.37 W 37.75, S 79.37, E 35.75 TO a Folio AKA: UNIT E MARINA VILLAGE TOWNHOMES 227GARDEN with Number of 4943 18 24 0050; hereafter also referred to as (RP12) 708 Spangler Boulevard, Bay 1, Hollywood, Florida, ments and "Defendant RP I 2," includes all buildings, improvements, fixtures, attach bed as: HARBOR easements found therein or thereon, and is more particularly descri M 25 S OF NE VIEW 10-5 B PORTION OF LOTS I & 2 BLK 2 DESC AS COM 84, S 15.72 TO POB, COR OF LOT 2 ON E/L, W 20.52 ALG S/R/W/L OF ST RD E 49.07 TO POB S 7.25, E 12.59, S 24.40, W 29.92, N 7.66, W 31.74, N 24.00, 23 28 0010; AKA: BAY 1 PORTSIDE with a Folio Number of 5042 a, hereafter also referred to (RP 13) 1012 East Broward Boulevard, Fort Lauderdale, Florid nts, fixtures, attachments as "Defendant RP13," includes all buildings, improveme particularly described as: and easements found therein or thereon, and is more W 100 BLK 17 with a Folio BEVERLY HEIGHTS 1-30 B LOT 1 W 100, LOT 2 Number of 5042 11 07 0540; Florida, hereafter also referred to as (RP14) 950 N Federal Highway, Fort Lauderdale, fixtures, attachments and "Defendant RP14," includes all buildings, improvements, ularly described as: 31-48-43 easements found therein or thereon, and is more partic 5, N TO POB with a Folio S 150 OD FOL DESC, BEG INTER E R/W/L ST RD Number of 4843 31 00 0401; 21 EFTA00729460 ket 12/01/2009 Page 22 of 36 Case 0:09-a-60331-JIC Document 1 Entered on FLSD Doc t 2, Fort Lauderdale, Florida, hereafter also (RN 5) 350 Las Olas Boulevard, Commercial Uni all portion of that condominium, referred to as "Defendant RP15," includes ts found therein or thereon, and is improvements, fixtures, attachments and easemen S PLACE COMM CONDO UNIT more particularly described as: 350 LAS OLA 0; CU2 with a Folio Number of 5042 10 AP 002 hereafter also referred to as "Defendant RP16," (R1316) 361 SE 9 Lane, Boca Raton, Florida res, attachments and easements found includes all buildings, improvements, fixtu therein or thereon; as Boca Rato n, Florida hereafter also referred to (R917) 1198 N Old Dixie Highway, and s, improvements, fixtures, attachments "Defendant RP17," includes all building easements found therein or thereon; referred to as Boca Raton, Florida hereafter also (tP18) 1299 N Federal Highway, and s, improvements, fixtures, attachments "Defendant RPI 8," includes all building easements found therein or thereon; rred to 42D , New York, New York hereafter also refe (RP19) 151 East 58 Street, Apartment ments, portion of that condominium, improve as "Defendant RP I 9," includes all d therein or thereon; fixtures, attachments and easements foun as ragansett, Rho de Island hereafter also referred to (RP20) 11 Bluff Hill Cove Farm, Nar and s, improvements, fixtures, attachments "Defendant RP20," includes all building easements found therein or thereon; 22 EFTA00729461 Case 0:09-cr-60331-JIC Document 1 Entered on F LSD Docket 12/01/2009 Page 23 of 36 t, Rhode Island hereafter also referred to as (RP21) 15 Bluff Hill Cove Farm, Narraganset s, rovements, fixtures, attachments and "Defendant RP21," includes all building imp easements found therein or thereon; NY hereafter also referred to as "Defendant (RP22) 353 4 Ave., Unit 12-H, Brooklyn, dominium, improvements, fixtures, RP22," includes all portion of that con or thereon; attachments and easements found therein s r also referred to as"Defendant RP23," include (RP23) 290W 11th St ti1C,NY, NY hereafte ments, fixtures, attachments and easements all portionof that condominium, improve found therein or thereon; and -10% Ownership hereafter also referred to as (RP24) Versace Mansion/Casa Casuarina improvements, fixtures, attachments and "Defendant RP24," includes all buildings, easements found therein or thereon; C. Vehicles and Vessels ("VV"): ZFFMN34A5L0087066; (VV I) 1990 Red Ferrari F40 Coupe, VIN: VIN: SCBDR33W29C059672; (VV2) 2009 White Bentley Convertible, Benz SLR , VIN: WDDA1C76F98M0017813; (VV3) 2008 Yellow McLaren Mercedes ion, VIN: IF liK15557LA59223; (VV4) 2007 Black Limousine Ford Expedit : ZFFEW59A380163011; (VV5) 2009 Red Ferrari 430 Spider, VIN , VIN: SCA1L68557UX23044; (VV6) 2007 Silver Rolls Royce Convertible : 137PH84396E220665; (VV7) 2006 Silver Hummer HI, VIN lOYEC63858R234458; (VV8) 2008 Cadillac Escalade, VIN: e, YIN: 194677S104745; (VV9) 1967 Red Convertible Corvett 23 EFTA00729462 ge 24 of 36 Case 0:09-cr-60331-J1C Document 1 Entered on FLSD Docket 12101/2009 Pa ; EB 16. 4, VIN: VF9SA25C28M795153 (VVIO) 2009 Black Bugatti Veyron Drophead Convertible, VIN : SCA2D68528UX 16071; (VVI 2)2008 Blue Rolls Royce # WA R87777B707; (VV17) 2007 87' Warren, Hull XPA33R740405; (VV18) 33' Aquariva, Hull # Ski, Hull If YAMA36611809; (VV19) 2009 I l' Yamaha Jet , Hull # YAMA36261809; (VV20) 2009 11' Yamaha VS , Hu ll NYAMA26796809; (VV21) 2009 11' Yamaha VS Sundancer, SERY001899; (VV22) 1999 55' Sea Ray 540 and , Hull # YAMA4288K1109; (VV23) 2009 Yamaha Jet Ski A1IXALA03837. 1p-670sv, VIN: ZHWBU8 (VV 24) 2010 White Lamborghini II Tangibles ("T") or about Monday, tches, neckla ces and earrings seized on (T I) 304 pieces of jewelry•, wa Rothstein; reside nce of Scott and Kimberly November 9, 2009 from the m the on or about Monda y, November 9, 2009 fro (T2) 16 DuPont Lighters seized berly Rothstein; residence of Scott and Kim 9 from the seized on or abo ut Monday, November 9, 200 (T3) 3 pieces sports memorabilia berly Rothstein; residence of Scott and Kim 9 rency seized on or about Monday, November 9, 200 (T4) $271,160 in United States cur and Kimberly Rothstein; from the residence of Scott 4, 2009, rency, seized on abo ut Wednesday, November (I'S) $1,500 in United States cur Rosenfeldt and Rothstein at the law firm of Rothstein, from the office of Scott W. Adler, P.A.; 24 EFTA00729463 Case 0:09-cr-60331-JIC Document 1 Entered on F LSD 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 (19) Guitar collection of Scott W. Rothstein, located at the residence of Scott and Kimberley Rothstein, valued between SI0,000 and $20,000. E. Bank Accounts ("BA") (BA1) Fidelity Investments Stock Account, in the name of Scott W. Rothstein, valued at approximately $1,263,780; (BA2) Gibraltar Bank account 50010085, in the approximate amount of $484,900.68; (BA3) Gibraltar Bank account 50010093, in the approximate amount of $53,448.51; (BA4) Gibraltar Bank account 50012053, in the approximate amount of $71,793.06; 2; (BA5) Gibraltar Bank account 50015214, in the approximate amount of $995,521.4 (BAG) Bank account 178780211819923220000187 at Banque Populaire, Morocco, in the name of Scott Rothstein, in the approximate amount of $12,000,000; to (BA7) Bank account at Banque Populaire, Morocco, in the name of Ahnick Khalid, up the amount of $2,000,000; the (HAS) Bank account at Banque Populaire, Morocco, in the name of Steve Caputi, up to amount of $1,000,000; 25 EFTA00729464 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 26 of 36 of Rothstein (BA9) Toronto Dominion Bank, N.A. account 6860291266 in the name conta ined the Rosenfeldt Adler, P.A. which, on or about November 11, 2009, approximate amount of $54,021.27; in the name of Rothstein (BA10)Toronto Dominion Bank, N.A. account 6861011556 2009, contained the Rosenfeldt Adler, P.A. which, on or about November 11, approximate amount of $10,085.00; in the name of Rothstein (BA11)Toronto Dominion Bank, N.A. account 6860420923 on or about November 11, Rosenfeldt Adler, P. A, Attorney Trust Account 3, which, 2009, contained the approximate amount of $720,892.08; in the name of DJB Financial (BA12)Toronto Dominion Bank, N.A. account 6860422200 ined the approximate amount Holding, which, on or about November 11, 2009, conta of $64,970.00; 55757 the name of RRA Sports and (BA13)Toronto Dominion Bank, N.A. account 68607 11, 2009, contained the Entertainment LI.C, which, on or about November approximate amount of $10,490.10; 55781 in the name of RRA Goal Line (BA14)Toronto Dominion Bank, N.A. account 68607 mber 11, 2009, contained the Management, LLC, which, on or about Nove approximate amount of $25,216.27; 6861077714 in the name of Rothstein (BAIS)Toronto Dominion Bank, N.A. account November 11, 2009, contained the Rosenfeldt Adler, P.A., which, on or about approximate amount of $20,080.00. 26 EFTA00729465 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 27 of 36 F. Business Interests ("BI") ficial inte rest in such shares, of 50,000 shares (B11) Stock certificates, if issued, or the bene st, a federally chartered stock of capital stock, in Gibraltar Private Bank & Tru September 2009 by GBPT, LLC, a savings association, purchased in or about manager, Bahia Property Management, Delaware Limited Liability Company, by its its co-manager, Scott W. Rothstein; LLC, a Delaware Limited Liability Company, by in QTask; (Bt2) Scott W. Rothstein's equity interest in Bro ward Bank of Commerce; (BD) Scott W. Rothstein's equity interest in Bov a Ristorante; (BM) Scott W. Rothstein's equity interest interest in Bova Cucina; (BI5) Scott W. Rothstein's equity in Bov a Prime; (B16) Scott W. Rothstein's equity interest rest in Cafe Iguana, Pembroke Pines, Florida; (BI7) Scott W. Rothstein's equity inte in Car t Shield USA, LLC; (B18) Scott W. Rothstein's equity interest interest in Renato Watches; (819) Scott W. Rothstein's equity in Edify LLC; (BI10) Scott W. Rothstein's equity interest interest in V Georgio Vodka; (BM) Scott W. Rothstein's equity rest in Sea Club; (BI12) Scott W. Rothstein's equity inte interest in North Star Mortgage; WI I3) Scott W. Rothstein's equity rest in Kip Hunter Marketing; (B114) Scott W. Rothstein's equity inte ment, LLC; interest in RRA Sports and Entertain (BI15) Scott W. Rothstein's equity g rest in Ver sace Mansion/Casa Casuarina, includin (BI16) Scott W. Rothstein's equity inte 2 ten year options; 10 year Operating Agreement with 27 EFTA00729466 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 Biofticl 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; (3121) Scott W. Rothstein's equity interest in, and rents derived from 1198 Dixie LLC; (BI22) Scott W. Rothstein's equity interest in, and rents derived from 1299 Federal LLC; (8123) Promissory Note by Uniglobe in favor of Scott W. Rothstein; and (B124) All equity interest held by or on behalf of Scott W. Rothstein, in the following corporations and entities: a. 29 Bahia LLC; b. 235 GC LW; c. 350 LOP#2840 LLC; d. 353 BR LLC; e. 10630 #110 LLC; f. 708 Spangler u.,o, g. 1012 Broward LLC; h. 1198 Dixie LLC; 1. 1299 Federal LLC; j. 2133 IP LLC; k. 15158 LLC; I. AANG LLC; 28 EFTA00729467 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 29 of 36 m. AAMG1 LLC; n. AAMM Holdings; 0. ABT Investments LW; p. Advanced Solutions; q. Bahia Property Management LLC; r. Boat Management LLC; s. BOSM Holdings LLC; t. BOVA Prime LLC; u. BOVA Restaurant Group LLC; v. The BOVA Group LLC; w. BOVA Smoke LLC; x. BOVCU LLC; y. BOVRI LIZ; z. Broward Financial Holdings, Inc.; aa. C107 LLC; ab. CI08 LLC; ac. C116 LLC; ad. C127 LLC; ae. CSU LLC; at I) & D Management & Investment LLC; ag. D & S Management and Investment LLC; ah. DJB Financial Holdings LLC; 29 EFTA00729468 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 I AC; al. GHWI. LLC; am. IDNL GEAR LLC; an. ILK3 LLC; ao. IS Management LLC; ap. JRCL LLC; aq. Judah LLC; ar. Kendall Sports Bar; as. Kip Hunter Marketing LLC; at. NF Servicing LLC; au. NRI 11 LLC; ay. NRI 15 LLC; aw. NS Holdings LLC; ax. PRCH LLC; ay. PK Adventures LLC; az. 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 EFTA00729469 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 31 of 36 be. RSA 116 Street LLC; bf. RW Collections LLC; bg. S & KEA LLC; bh. Scorh LLC; bi. Tipp LLC; bj. VOS 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 LLC; bs. WAWW 6 LLC; bt. WAWW 7 LLC; bu. WAWW 8 LLC; by. WAWW 9 LLC; bw. WAWW 10 LLC; bx. WAWW 11 LLC; by. WAWW 12 LLC; bz. WAWW 14 LLC; 31 EFTA00729470 36 Case 0:09-cr-60331-JIC Document 1 Entered on FLSD Docket 12/01/2009 Page 32 of ca. WAWW 15 LLC; cb. WAWW 16 LLC; cc. WAWW 17 LLC; cd. WAWW 18 LLC; ce. WAWW 19 LLC; cf. WAWW 20 LLC; cg. WAWW 21 LLC; eh. WAWW 22 LLC; ci. JB Boca M Holdings LLC; and G. Contributions ("C"), hereinafter collectively referred to as "the defendant contributions:" (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 campaign contributions to Republican Party ofFlorida, "Florida" account and voluntarily offered, and turned over, to the United States by the RepublicanParty of Florida; (C3) $10,000 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 EFTA00729471 Case 0:09-er-60331-J1C Document 1 Entered on FLSD Docket 12/01/2009 Page 33 of 36 (CS) $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 ofFlorida; (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 Family Foundation, for the purpose of facilitating forfeiture; (C8) $9,600 in campaign contributions to Governor Charlie Crist, voluntarily offered, and turned over, to the United States by the office of Charlie Criss; and (C9) All funds voluntarily turned over to the United States (IRS/FBI), since in or about October 28, 2009, in response to publicity regarding Scott W. Rothstein. 6. If any of the property described above as being subject to forfeiture, as a result of any act and omission of the defendant - i. cannot be located upon the exercise of due diligence; ii. has been transferred or sold to, or deposited with, a third party; iii. has been placed beyond the jurisdiction of the court; iv. has been substantially diminished in value; or v. has 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 Tide 18, United 33 EFTA00729472 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, Tide 18, United States Code, Section 982(a)(1) and Title 18, United States Code, Section 981(aXI)(C) made applicable through Title 28, United States Code, Section 2461; and the procedures outlined at Title 21, United States Code, Section 853. M Me ACTING UNITED STATES ATTORNEY ASSISTANT UNITED STATES ATTORNEY ASSIS ANT UNITED STATES ATTORNEY ASSISTANT UN ATTORNEY 34 EFTA00729473 Case 0:09-cr-60331-JIC Document 1 STATES DI CT cuitir SOUTHERN DISTRICT OF FLORIDA UNITED STATES OF AMERICA CASE NO. vs. CERTIFICATE OF TRIAL ATTORNEY. SCOTT W. ROTHSTEIN Defendant. Superseding Case Information: New Defendant(s) Yes .if___ _Mn Court Division: (Sava one) Number of New Defendants Miami _ Key West Total number of counts . Eli _ WPB _ FTP I do hereby certify that: 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 IndictmenVInformation attached hereto. I am aware that the Information supplied on this statement will be relied upon by the Judges of this 2. of the Speedy TrialAct, Court in settin_g their calendars and scheduling criminal trials under the mandate Title 28 U.S.C. Section 3161. 3. Interpreter (Yes or No) List language and/or dialect 4. This case will take IL_ days for the parties to try. 5. Please check appropriate category and type of offense listed below. err( (Check WI (Check odor 0001 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) No_.— If yes: Magistrate Case No. 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 potential death penalty case? (Yes or No) No-- 7. Does this case originate from a matter pending in the U.S. Attorney's Office prior to April 1, 2003? Yes S. No 8. Does this case originate from a matter pending in the U. S. Attorney's Office prior to April 1, 1999? Yes I_ No If yes, was it pending in the Central Region? _ Yes — No prior 9. Does this case originate from a matter pending in the Northern Region of the U.S. Attorney's Office 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 V.S. Attorney's Office prior to September 1, 2007? Yes X No ASSISTA ES ATTORNEY Florida Rar No. EFTA00729474 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 11: 1 18 U.S.C. § 1962(d); RICO Conspiracy; * Max.Penalty: 20 years imprisonment, $250,000 fine Count #: 2 18 U.S.C. § 1956(h); Conspiracy to Commit Money Laundering; • Max.Penalty: 20 years imprisonment, $500,000 fine or twice the value of the property involved in the transaction. Count #: 3 18 U.S.C. § 1349; Conspiracy to Commit Mail Fraud and Wire Fraud; * Max.Penalty: 20 years imprisonment, $250,000 fine Counts #: 4-5 18 U.S.C. §§ 2; 1343; Wire Fraud * Max.Penalty: 20 years imprisonment, $250,000 fine *Refers only to possible term of incarceration, does not include possible fines, restitution, special assessments, parole terms, or forfeitures that may be applicable. EFTA00729475 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 RCYl'HSTEIN ROSENFELDT ADLER, P.A., a Florida Professional Service Corporation, Plaintiffs, v. SCOTT W. ROTHSTEIN, individually, Defendant. 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. Rosenfeldt, individually, and Rothstein Rosenfeldt Adler, P.A. (sometimes referred to as the "firm"), file this action against Scott W. Rothstein, and allege as follows: PRELIMINARY STATEMENT It is with surprise and sorrow that the attorneys of Rothstein Rosenfeldt Adler, P.A. have learned that Scott W. Rothstein, the managing partner and CEO of the firm, 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. 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 COFFBY B URLINOTON OFFICE In THE GROVE, PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI. FLORIDA 33133 T: 305.858.2900 F: 305.858.5261 Email: infoecoffeyburlington.com www.coffeyburlIngton.com EFTA00729476 the firm in an appropriate accounting of investor funds and to address the ongoing affairs of Rosenfeldt. Mr. Rosenfeldt, as manner through the transfer of all corporate powers to Stuart A. es Mr. Rothstein, is uniquely the firm's President and only other equity holder in the firm besid funds in the firm's trust positioned to wind down the affairs of the firm, to account for all clients. In the alternative, accounts, and, most importantly, to protect the interests of the firm's dian of the firm during its Plaintiffs 'request that the Court appoint Mr. Rosenfeldt as custo appoints a receiver, there is no dissolution or appoint a receiver. In the event that the Court law practice because the dedicated necessity for the receiver to assume any control of the firm's of the firm's clients will remain attorneys and staff are continuing to assure that the interests paramount and will be fully protected. ize any further damage caused • Mr. Rosenfeldt and the firm have filed this action to minim eys and staff of the firm are not by Mr. Rothstein, to emphasize that the innocent attorn protect the best interests of their clients. implicited in this controversy, and, most importantly, to NATURE OF ACTION nting pursuant to 1. This is an action for judicial dissolution of the firm and an accou seek transfer of all corporate Florida Statutes Section 607.1430(3). Additionally, Plaintiffs ntment of Plaintiff Rosenfeldt as powers to Plaintiff Rosenfeldt, or, in the alternative, the appoi ant to Florida Statutes Sections custodian of the firm or the appointment of a receiver, pursu 607.1431 and 607.1432. nt authority to 2. Plaintiff Rosenfeldt is the firm's president. He has the inhere initiitethis emergency litigation. Rothstein, a 3. Defendant Rothstein is the firm's managing partner and CEO. nt, especially financial matters, charismatic and talented lawyer, has controlled firm manageme 2 C OFFEY BURLINGTON BAYSHORE DRIVE MIAMI, FLORIDA 331 33 OFFICE IN THE. GROVE, PENTHOUSE 2699 Soum T: 305.85 8.2900 F: 305.858.5261 Email: infoecoffeyburlington.com www.coffeyburlington.com EFTA00729477 any other attorney at the and has not extended access to core financial matters and records to firm. rs of the equity in 4. Plaintiff Rosenfeldt and Defendant Rothstein are the sole owne the firm. Suite 1650, Fort 5. The firm's principal office is located at 401 East Las Olas Blvd, Lauderdale, FL 33301. pal office is in 6. Venue properly lies with this Court because the firm's princi Broward County. BACKGROUND AND GROUNDS FOR DISSOLUTION The Firm dant Rothstein in 2002. 7. The firm was founded by Plaintiff Rosenfeldt and Defen employment law, but the 8. The firm's practice was originally focused on labor and include intellectual property, corporate law, firm grew rapidly and its practice areas expanded to action s, mass torts and personal mergers and acquisitions, real estate, criminal defense, class injury claims, among others. a, New York, and O. The firm currently has seven offices, with locations in Florid Venezuela, and employs over 70 lawyers. including 10. The firm has an outstanding group of attorneys, staff members, ide, even national reputations, for distinguished former judges, many of whom have statew professional excellence. The Settlement Funding Scheme s surrounding a 11. Firm lawyers learned in the past few days about irregularitie settlement funding business involved settlement funding business operated by Rothstein. The 3 COFFEY BURLINGTON BAYSHORE DRIVE MIAMI. FLORIDA 33 l 33 OFFICE IN THE GROVE. PENTHOUSE 2.699 SOUTH T: 305.858.2900 F: 305.858.526 Email: infoecotleyburlington.eom www.coffeyburlington.com EFTA00729478 ments to investors. the purchase of structured legal settlements and the sale of these settle ntial funds are not properly Various investors have informed the firm that they believe that substa taken over this past weekend accounted for and are missing. A review of the firm's records under t be accounted for, indicates that various funds unrelated to the direct practice of law canno ed by Rothstein who circumstances suggesting that investor money may have been misus dant Rothstein may have been controlled all such accounts. Some investors allege that Defen to investors. fabricating non-existent structured legal settlements for sale ut any 12. Defendant Rothstein's allegedly improper activities were done witho tein actively endeavored to hide knowledge of the other attorneys at the firm, and, in fact, Roths ago that Plaintiff Rosenfeldt or any of the existence of the scheme. It was not until several days stances conce rning Defendant the other lawyers at the firm discovered some of the circum Rothstein's actions and the alleged improprieties. concerning the b. The firm's attorneys still have extremely limited knowledge expeditiously to undercover the allegations, and yet, recognize the importance of proceeding to Plaintiff Rosenfeldt, or, in the truth. Thus, the emergency transfer of all corporate powers as the firm's custodian or the alternative, the emergency appointment of Plaintiff Rosenfeldt preliminary inquiry concerning appointment of a receiver, is critical to undertake at least a mendations to the Court Defendant Rothstein's conduct, and to make appropriate recom concerning any further investigation. Misuse of the Investor Trust Accounts recently 14. With respect to the settlement funding scenario, Plaintiffs only tein's investor trust accounts and discoVered troubling information concerning Defendant Roths ver, it appears that Defendant details surrounding the transactions are still emerging. Howe 4 COFFEY BURLINGTON BAYSHORE DRIVE MIAMI, FLORIDA 33133 OFFICE IN THIS GROVE, PENTHOUSE 2699 SOUTH I': 305.858.29 00 P: 305.858.5261 Email: infoec offeyb urling ton.co m www.coffeyburlington.com EFTA00729479 or trust accounts, and that the Rothstein may have transferred substantial sums out of the invest in the alternative, the emergency transfer of all corporate powers to Plaintiff Rosenfeldt, or, dian or the appointment of a emergency appointment of Plaintiff Rosenfeldt as the firm's custo taking action to recover the receiver, is necessary to account for and, if appropriate, consider missing investor trust account funds. Shareholder Deadlock substantial 15. Defendant Rothstein has declined to resign despite the asserted and firm. For this reason, among irregularities because he purports to hold a 50% share of the law management of the firm as it currently others; there is a substantial shareholder deadlock, making stands impossible. COUNT I (DISSOLUTION) 16. Plaintiffs adopt, incorporate, and reallege paragraphs 1-15. ve a corporation in a 17. Under Florida Statute 607.1430, a circuit court may dissol affairs is deadlocked and irreparable proceeding by a shareholder if the management of corporate ionally, a circuit court may injury to the corporation is threatened or being suffered. Addit ient showing is made with dissolve a corporation having 35 or fewer shareholders if a suffic s the corporation. respect to improper or irregular conduct that materially injure two grounds for 18. For the reasons stated herein, Plaintiffs have demonstrated these dissolving the firm. all other such remedies that the WHEREFORE, Plaintiffs demand judgment of dissolution and Court fords appropriate. 5 COFFEY B URLINGTON ORE DRIVE MIAMI, FLORIDA 33133 ORRICE IN THE DROVE, PENTHOUSE 2699 SOUTH BAYSH T: 305.858.2900 F: 305.858.5261 www.coffeyburlington.com Email: infoecoffeyburlington.com EFTA00729480 COUNT II (TRANSFER OF CORPORATE POWER TO PLAINTIFF ROSENFELDT) 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 the corporation. 21. For the reasons stated herein, Plaintiffs submit that the Court's exercise of this discretionary power is appropriate to transfer all corporate power over the firm to Plaintiff Rosenfeldt to effect the dissolution request 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 firm's client engagements, to appoint a chief restructuring officer and an inventory attorney pursuant to Florida Bar Rule 1-3.8, to institute federal bankruptcy proceedings or other related state law proceedings, to file assignments for the benefits of creditors, and to undertake all such other actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs demand that the Court transfer all corporate power over the firm to Plaintiff Rosenfeldt. COUNT HI (IN THE ALTERNATIVE, APPOINTMENT OF PLAINTIFF ROSENFELDT AS CUSTODIAN OF THE FIRM) 22. Plaintiffs adopt, incorporate, and reallege paragraphs 1-18. 23. Florida Statutes 607.1431(3) and 607.1432 permit a circuit court in a judicial diqcolutiOn to appoint a custodian to manage the business and affairs of the dissolving corporation. 6 COFFEY B ORLINGTON FLORIDA 33133 OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BAYSKORE DRIVE MIAMI, T: 305.858.2900 P: 305.858.5 261 Email: infoecoffeyburlingtoa.com www.coffeyburlington.com EFTA00729481 24. For the reasons stated herein, Plaintiffs request, in the alternative to Counts II 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 firm's client engagements, to appoint a chief restructuring officer and an inventory attorney pursuant to Florida Bar Rule 1-3.8, to institute federal bankuptcy proceedings or other related state law proceedings, to file assignments for the benefits of creditors, and to undertake all such other actions as may be necessary and appropriate under law. WHEREFORE, Plaintiffs demand, in the alternative, that the Court appoint COUNT IV (IN THE ALTERNATIVE, APPOINTMENT OF A RECEIVER\ 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 dissolution to appoint a receiver to wind up and liquidate the business and affairs of the dissolving corporation. 27. For the reasons stated herein, Plaintiffs request, in the alternative to Counts If and III, that the Court appoint a receiver to effect the dissolution requested in Count I, perform an accounting of the firm's assets and liabilities, undertake all actions necessary to uncover the extent of Defendant Rothstein's activities, and to undertake all such other actions as may be necessary and appropriate under law. 7 COFFEY BURLINGTON OFFICE IN THY. GROVE, PENTHOUSE 2699 SOUTH BAYSHORY. DRIVH MIAMI, FLORIDA 33133 T: 305.858.2 900 F: 305.858.5261 Email: info@toffeyburlington.com www.coffeyburSingcon.com EFTA00729482 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 receiver, are critical to uncover the fall extent of Defendant Rothstein's activities, to consider any appropriate action to recover missing proceeds, to protect the fum's clients, and to preset ye, protect and review the firm's accounts and financial records.' Dated this 3rd day of November, 2009. Respectfully submitted, COFFEY BURLINGTON Counsel for Plaindffs 2699 South Bayshore Drive, Penthouse Miami, Florida 33133 (305) 858-2900 B OS FEINECIV ILLADN Florida Bar . 259861 Annexed hereto as Exhibit A is an affidavit from Plaintiff Rosenfeldt attesting to the truthfulness of the allegations contained herein. 8 COFFEY B URLINOTON OFFICE IN THE GROW., PENTHOUSE 2699 SOUTH SAVSHORE DRIVE MIAMI- FLORIDA 33133 T: 305.858.2 900 P: 305.858.5 261 Email: in foecoffeybu rlingion.coni www.coffeyburlington.com EFTA00729483 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 Es , a true and correct copy of the above and foregoing was served via email on Mr. Nurik, at This 3rd day of November, 2009. M.P ICSAM 9 COFFEY B 1./RLINGTON 33133 OFFICE IN THE GROVE, PENTHOUSE 2699 SOUTH BAYSHORE DRIVE MIAMI, FLORIDA T: 305.858.2 900 F: 305.858.5 261 Email: infoecoffeyburlington.com www.coffeyburlington.com EFTA00729484 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. UNDER SEAL -CIV.MARRA EDWARD MORSE and CAROL MORSE, Plaintiffs, VS. JAN JONES INTERNATIONAL, INC. afkia ICON BY JAN JONES, De&indent. ORDER ON PLAINTIFFS' ORE TENUS MOTION TO SEIZE FURTHER ASSETS ANDFOR OTHER RELIEF This cause came before the Court at hearing on March 17, IS, 19 & 20 2009, upon plaintiffs', EDWARD MORSE and CAROL MORSE (collectively "MORSE"), ore lends Motion to Seize Further Assets and ore Nina and subsequent written motions for other relief. The Court has carefully considered the oral argument of counsel, considered the evidence and witnesses presented at the hearings and being otherwise fully advised in the premises; The COURT FINDS AND ORDERS AS FOLLOWS: I. Defendant. JAN JONES INTERNATIONAL, INC. itilt/a. ICON BY JAN JONES and any and all other companies antVot other entities owned or controlled by JONES (`IONES"), are liable for compensatory damages to MORSE in an amount in excess of $2.000.000.00: 2 Thal 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 $3,000,000.00 in punitive dnmaget: Page I of 6 EXHIBrr g EFTA00729485 activity as demonstrated by 3. The Court specifically finds that JONES' flagrant fraudulent 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. Thai there is currently in excess of SI0,000,000.00 of finds clearly belonging to JONES frozen in various banks in South Florida pursuant to prior orders of this and other courts; 5. That these funds are not to be moved under any circumstances absent further order of this Court. That movement of these funds shall be punishable by civil and criminal penalties; 6. That these funds are specifically being held, pursuant to order of this Court, to fund the award of damages to MORSE; 7. That these courts have jurisdiction to order same; 8. That in addition to the funds set forth in paragraph 4 above, based upon clear and convincing evidence presented by counsel for MORSE and counsel's expert witnesses, JONES has illegally moved funds from the United States to the Cayman islands in violation of federal law. for the purpose of secreting these assets; 9. That the IRS has provided competent testimony in this regard clearly establishing ownership of these funds by JONES and clearly establishing a partial right of entitlement by the IRS to a portion of these funds. Such liability shall be less than S5,000,000.00; 10. That this Court has jurisdiction over said assets as they originated in the United States; 11. That 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 EFTA00729486 result,. this Court has received clear and convincing evidence that such funds will be immediately transferred to the United States; 12. That the Clerk of Court is hereby directed to immediately submit the proper documentation to the appropriate bank of the Cayman Islands to facilitate immediate transfer of these funds. That any issue arising from such transfer shall be immediately reported to this Court; 13. That the evidence presented by counsel for JONES was inadequate to overcome the findings made by this court based upon the evidence presented by counsel for MORSE. That counsel for JONES is hereby is found to have acted in contumacious disregard for prior orders of this and other courts and thus, is found to be in contempt thereof Further order regarding same shall follow the evidentiary hearing in this regard to be set by this Court 14. That MORSE shall be entitled to one-third of any monies collected from counsel for JONES pursuant to said contempt order, if monies arc assessed: IS. That this Court has entered an order freezing said assets and has the authority to do so; 16. That JONES' counsel's arguments that this Court lacks such jurisdiction is without merit and frivolous; 17. That the presentation of such evidence by counsel for JONES demonstrates a lack of a good faith basis to prevent same in violation of Federal Rule of Civil Procedure, 1I: IS. That 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 EFTA00729487 Court 19. That these funds shall be frozen for the purpose of satisfying the judgment of this against JONES and in MORSE's favor; 2a That MORSE shall be required to deposit to their attorney's trust account the sum of 515,000,000 00 no later than 10:00 a.m. tomorrow morning, the 20th day of March, 2009, to secure JONI•;S in the event of an illegal seizure of said funds. If such funds arc not so posted, this order shall be null and void in its entirety and the case shall proceed according to further order of this Court; 21. That counsel for MORSE shall appear before this Court and testify, under oath. as to his receipt of these funds, under penalty of perjury and subject to action by the Florida Bar; 22. That based upon argument and representations of MORSE's counsel, made under oath, MORSE is suffering from significant financial distress due to the economy and that such a posting could cause severe and irreparable harm to MORSE; thus, as swiftly n possible, in a manner that does not interfere with the mission of the federal agencies now herewith involved, however, with the full and unfettered cooperation of the federal agencies now Involved in this matter, following the posting by Morse of SI 5,000,000.00 associated with the seizure of the funds located in the Caymans. all other bond amounts shall be returned to MORSE as follows: $15,000,000.00 previously posted by MORSE, S4.118,757.00 previously posted by MORSE, and the $18,500,000.00 posted in two separate postings by MORSE. MORSE's counsel shall act as liason between his clients and the federal agencies to expedite return of tho 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 not be unreasonably withheld. The Clerk of the Courts is ordered to take all steps necessary to Page 4 of 6 EFTA00729488 MORSE in a timely and expedited assist touristl in expediting return of the funds to fashion; Clerk's receipt of said funds herewith being 25. Further, within three (3) business days of the order, said amount being trarnfcrred from the Cayman Islands in compliance with this so that this Court can issue approximately 520,000,000.00, shall notify this Court of same (5) business days of such order an order as to the division of said funds. Within five delivered to them via their dividing same, that portion belonging to MORSE shall be counsel; tight to appeal the order of interest and 24. The Court finds that JONES has waived its ment. The court finds that JONES penalties based upon the doctrine of fraud in the induce fact the doctrine that he who is not entitled to equitable relief of any kind based upon the hands and thus can not recover seeks equity must do equity. JONES has unclean anything from MORSE: tly hearing the matter known as 25. That this Court has jurisdiction over the Court curren hereafter referred to as MIZNE14, referred to in the Court record by number and any and all bond funds held 26. That this Court orders the Court below (MIZNER) to release business days of the entry of this pursuant to prior order of that court within three (3) that same occurs. Should order. Counsel for MORSE shall facilitate same and insure this Court on an emergency there be a delay, counsel for MORSE shall appear before shed objectives. basis and seek whatever assistance is needed to achieve the establi all deadlines in this Order are satisfied 27. Counsel for the panics are instructed to insure that in a timely fashion, subject to further order of this Court; Page 5 of 6 EFTA00729489 have Southern District of Florida and this Court 28. That both the Federal Court of the same may be enforced in either venue; and concurrent jurisdiction over these matters and om of as amended on October 2I, 2008, The freed 29. That pursuant to the Bank Secrecy Act Act II, The Currency and Foreign Transaction Information Act, The United States Patriot November 11, 2006, 1.1SC 5311.5300, the USA Repotting Act of 1970 as amended on ved t of this Court based upon information recei Patriot Act, Title III and the judgmen and unts contained herein, the findings hereof, under oath, this Order, the facts of and amo to e shall be held in strict confidence so as not any and all other matters surrounding sam agencies. tion by the appropriate governmental jeopardize any potential investiga result in civil and criminal penalties. Violation of this portion of this order shall ida this at West Palm Beach, Palm Beach County, Flor DONE AND ORDERED in Chambers 25th day of March , 2009. KENNETH A. MARRA United States thstlict Judge Copies to: All counsel of record IRS, Plantation Office • FBI, Miami Office Page 6 of 6 EFTA00729490 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. UNDER SEAL -UV-MARRA EDWARD MORSE and CAROL MORSE. Plaintiffs, vs. JAN JONES INTERNATIONAL, INC. afltia ICON BY JAN JONES, Defendam. ZTIPULATED CONFIDENTIALITY ORDER I. On March 24, 2009, this Court ente red a detailed Order with regard to its Fina l Findings in this matter ("Final Order"). 2. As a direct result of the nature of a significa nt amount of the evidence presented to this Court prior to the Court entering its Final Order, and as a result of the contents of that Final Order, this Court has made a dete rmination that the Final Order itself as wel l as the evidence leading to same shall be seal ed and shall remain confidential, in perpetuity, unless otherwise ordered by this Cou rt or another court of competent jurisdict ion as detailed in this Confidentiality Order. 3. All parties to this matter, including all witnesses thereto, are hereby boun d by this Confidentiality Order. 4. Any failure to comply with this Confide ntiality Order by any party or witness shall result in set ere consequences. including, without limitation, civil and criminal penalties. Piktit 01I -; EFTA00729491 5 Any breach of this Confidentiality Order must be reported w the Court, immediately by the discovering party. Failure to so report same shall result in sever.- consequences, including, without limitation, civil and criminal penalties. 6. The Final Order of this court dated March 24. 2009 shall be made a part hereof, and shall be incorporated by reference herein. 7. Any failure to comply with this Confidentiality Order or Final Order, must be reported to this court, under seal, and such non compliance shall result in severe consequences to the breaching party. 8. All information relating this Court's Final Order to which any party is given access or which is made available to any party is hereinafter referred to as "Confidential Information." Confidential Information shall include, without limitation, all methods and systems used in this case, names and addresses of customers, technical memoranda, research reports, investigative reports, analyses of any part of this case, all data, documents, and technology, contracts, depositions, notes of depositions, clients notes, clients diaries, lawyers notes, court notes, court orders preceding this order, pleading, all discovery, all email or other electronic communications between any and all parties, witnesses, lawyers, and/or other participating in any way in this matter, proprietary information, historical and projected financial information• acts of fraud, information relating 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 quali6, 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 EFTA00729492 Because the secrecy of the Confidential Information is critical co 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 person or entity any Confidential Information without the express written consent of this court which may be withheld in its sole discretion, or (b) use any Confidential Information for the parties own benefit or any other purposes, for the benefit or purposes of any other person or entity or in any manner, whatsoever. If the party or witness is required in any civil or criminal legal proceeding, regulatory proceeding or any similar process to disclose any part of the Confidential Information, such party shall give prompt notice of such request to the Court and the Court shall enter an order as it deems appropriate. Nothing shall be disclosed without same. 9. All Confidential Information, including, without limitation, all copies of all documents and other materials which the parties have received or reviewed or otherwise have knowledge of, shall, at all times, be kept in strict confidence by the party. 10. The parties have been advised and fully understand the heightened confidentiality requirements relative to this matter, including, among other things, the legal obligations of 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 matter 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. ha% e Page 3 of I 5 EFTA00729493 access to certain Confidential infomiation as defined herein. By execution of this order, the parties recognize, acknowledge and confirm their understanding of the confidential mute 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 them upon execution of this document by their consent thereto. 11. Further, because disclosure of any Confidential information as defined herein would result in severe damage as contemplated by this Court, which would be difficult to quantify, the parties agree that liquidated damages would be a reasonable basis to calculate civil damages caused by a breach and that damages of $1,000,000.00 per each incident of disclosure of Confidential Information by the patties and/or their representatives is agreed to under this Confidentiality Order. Such liquidated damages shall not prevent this Court from assessing additional damages and from moving forward in a criminal proceeding against the party so breaching this Confidentiality Order. 12. Each party hereby represents and warrants that they are not bound by the terms of a confidentiality agreement or other agreement with any third party that would conflict with any of the parties' obligations under this Confidentiality Order. 13. The Parties stipulate that this Stipulated Confidentiality Order is intended to strictly limit and prevent disclosure of information and production of documents compromising the Confidential Information set forth herein and in the Final Order dated March 24 2009. 14. It is further acknowledged that each 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 Page 4 of I EFTA00729494 subject turasell or herself to the jurisdiction of this court for the purpose of enforcing this Confidentiality Order. 15. 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 to exercise extreme discretion in protecting same. The Court hereby warns all parties hereto to err on the side of protecting such data. Violation of this order will be dealt with immediately and subject the violator to severe sanctions and penalties. 16. This Agreement shall be binding upon the parties hereto and their respective agents, successors and assigns, and inure to the benefit of the parties and their respective successors and assigns. 17. The parties warrant to each other that they each have full power and authority to execute this Agreement for and on behalf of themselves and/or their respective companies. Parties. as used herein, shall include all persons executing this document as well as their representatives, agents and assigns. 18. Each party placing their signature hereon makes the following attestation: I Certify and acknowledge, under penalty of perjury, that I have received a copy of the Stipulated Confidentiality Order (the "Confidentiality Order") which governs the production 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 acknowledge that I am bound by it and agree to abide by it. I Maher understand that inibrmation designated as "CONFIDENTIAL" in this case. and any notes, memoranda or other form of information derived from it. Page 5 of IS EFTA00729495 may nor be used, copied or disclosed by IPX 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 PAGESi Page 6 of IS EFTA00729496 EDWARD I. MORSE STATE } COUNTY 11-1,c-/v-,s,j-t ) ed EDWARD J. MORSE who, after BEFORE ME, the undersigned authority, personally appear read the foregoing document and that it is being duly sworn according to law, deposes and says that he has uue and correct under penalty of perjury. may, ce-Cd2C49. SWORN AND SUBSCRIBED before roe chi/ 7 day oft 11 ,1 E _ „. .• ...ll• A :. (Signe. of Nasty Palk) NIL' PC" _,..,?: I ^ LA.. -; fr..— . . - . (Prim. Type. or Stan Mn, L ed Now otter ry Isibt I camas DAOUST . Wary Palk - Sma of • 1 it Comdata Expires Mai, 2012 Connissko II DO 76647D. BoxleillniSflakrsiNcOryAsen: COMMISSION NUMBERIPAPMATIONSEAL Pauc 7 of I 3 EFTA00729497 United States Court of Appeals, Eleventh Circuit. Under Sca]-Civ-Marra. EDWARD MORSE and CAROL MORSE, Plaintiffs-Appellants, v. JAN JONES INTERNATIONAL, INC. a/k/a ICON BY JAN JONES, Defendant-Appellee. In re EDWARD MORSE and CAROL MORSE, Petitioners. Appeal from the United States District Court for the Southern District of Florida (Under Seal- Civ-Mana), 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 below. 3. This matter is pending before the Honorable United States District Court Judge, Kenneth Marra. 4. On March 25, 20O9 and on April 23, 2009, Judge Marra entered detailed orders in this matter, copies of which are attached hereto and incorporated by reference herein. 5. As set forth in the Orders, Judge Man ordered that certain specific acts take place on certain specific dates. Many of these acts involved return of a large sum of money to the Plaintiffs. 1 ROTHSTEIN ROSEATELOT Anwi LAS OW City Centre, 401E. Las Ohs Bouleyard, Suite 1650, Fors Lauderdale, Florida 33301 EFTA00729498 6. Upon receipt of the orders, the undersigned began to put into place all actions necessary to timely comply with said 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. 8. However, despite continuous inquiry by the undersigned, counsel was unable to determine what Judge Marra intended to do and how he intended to proceed. 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 had significant basis for concern based upon comments and ore tenus rulings made by Judge Marra in the court below. 10. Most importantly, as can be seen by the sealed record now before this court, when the undersigned specifically inquired of the Court as to whether he was permitted to move forward with the orders entered on March 256 and April 23r° , the courts responses to the undersigned are non-descriptive and completely without guidance at best. 11. When the undersigned inquired of the court below further and specifically asked the court whether the orders were stayed, vacated, reversed or in full force and effect, the court clearly replied that the court believes it had made itself clear. 12. Not wanting to violate a court order of a respected district court judge, the undersigned determined that the only course of conduct remaining in order to protect his clients' rights was to file an Emergency 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 ROSENFEIDT /WIER Las Ohs City Centre, 401E. Las ()las Bookvant. Suite 1650, Fort Lauderdale, Florida 3330 k EFTA00729499 14. Moreover, it is without doubt that the undersigned had every right to be concerned with the ore taws 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 responsibility to fully and completely obey the orders of court and when, he is given reason to doubt the efficacy of subsequent orders of court that appear to taint the order in question, to attempt to ascertain the validity of said order. That is exactly what the undersigned has done here. 16. Upon determining that the validity of the orders in question were in doubt, and upon determining that he could not proceed without further order of a higher court, this Emergency Writ was filed. 17. Plaintiffs have a clear legal right to the relief specifically set forth in the orders in question. 18. The court below bad an indisputable duty to act but failed to do so and failed to given the undersigned any guidance. • 19. At this stage in the proceedings, the Plaintiffs have no other remedy at law other than this Writ. 20. If this writ is not entered in Plaintiffs favor, the Plaintiffs will suffer unfair prejudice as a matter of law. Dated this day of 2009. 3 ROTIISMN ROSEN FELITI ABLER Us Olas City Centre, 401E Las Ohs BoukevarcL Suite 1650, Fon Lauderdale. Florida 33301 EFTA00729500 Respectfully submitted, ROTHSTEIN ROSENFELOT ADLER Counsel for Petitioners Las Olas City Centre 401 E. Las Olas Boulevard Suite 1650 Fort Lauderdale, Florida 33301 Tel: (954) 522-3456 Fax: (954)527-8663 Email: . Rotticnin, Esq. Florida Bar No.: 765880 FOR THE FIRM 4 ROTHSTEIN ROSENFELDT ADLER Las Olas City Cenire, 401E. Las Ohs Boulevard, Suite 16.50. Fon Lauderdale, Honda 43301 EFTA00729501 United States Court of Appeals, Eleventh Circuit. Under Seal-Civ-Marra. EDWARD MORSE arid 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 District of Florida (Under Seal•Civ-Marra), Kenneth A. Marra, Judge. On Petition for Writ of Mandamus. Before Susan H. Black, Circuit Judge: ORDER ON EMERGENCY WRIT OF MANDAMUS Having reviewed the sealed court file as provided by the Clerk of the Court below (Judge Marra), and having heard argument of counsel in closed proceedings to maintain the integrity of the confidentiality order issued in this matter by the Court below, as well as having heard directly from Judge Marra and Judge Gerber, we find as follows: Findings of Fact 1. The Court below entered orders on March 25, 2009 and April 23, 2009, specifying that certain specific acts were to take place on certain specific dais. Many of these actions involved return of fluids rightfully belonging to the Piaintiffs. EFTA00729502 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 Judge Marra had no intention of proceeding as he previously ordered and was either reversing or staying his prior orders as set forth above. Whichever his intention is not for this Court to decide. We simply review this matter as it is presented to us, to wit: lawful orders were entered and then vacated or stayed for no clear and convincing reason and without a stated basis in law or fact. We make no finding whether Judge Marra was correct in his conclusion, but simply that the record lacked the thoroughness and completeness that is mandated when reversing orders of this magnitude. 4. Thus, we find that counsel for Plaintiff properly and timely filed a sealed Emergency Writ of Mandamus with this Court in an attempt to properly protect his clients rights under the order. Conclusions of Law 1. This Court has jurisdiction over this matter pursuant to the laws controlling Writs of Mandamus 2. This matter is properly before this court 3. The findings of Judge Marta in the court below, in the orders dated March 25 and April 23, 2009, are well based in fact and law. EFTA00729503 4. The subsequent ore tenus rulings of Judge Marra are without basis in law or fact. 5. The subsequent ore terms 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 Marra had the legal right to stay or reverse his prior order. 6. Plaintiffs writ of mandamus is legally sufficient to allow this court to 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 remain in full force and effect. To the extent that the later order conflicts with the earlier order, the later order shall prevail and control. 8. Judge Marra's concerns regarding protection of the Governments role in this matter are well founded in both law and fact. We specifically defer further comment on this portion of this matter to maintain the integrity of the governments investigation. 9. As a matter of procedure we note that a confidentiality order remains in full force and effect in this matter. We specifically mandate that our rulings herein shall have no effect, whatsoever, on said order and that same shall remain in full force and effect in perpetuity. We again strongly caution all counsel and mandate that they caution and counsel their respective clients that this matter is governed by a strict confidentiality order that this court hereby holds shall remain in full force and effect and which this court strongly cautions, contains severe penalties for any violation of sane. EFTA00729504 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 this court. Upon receipt of same, the clerk of this court shall advise Plaintiffs counsel that his Writ has been granted in full and that he is free to comply fully and completely with Judge Marra's orders. A copy of this order shall then be provided to all counsel of record. 12. This order shall not be famished to any counsel of record until such time as the Department of Treasury has completed its review of the sealed record and has forwarded said letter as mandated above this court This order is self executing and thus, nothing need be brought back before this court on any of these issues. 13. Plaintiffs have a clear legal right to the remedies they are seeking. 14. The court below had an indisputable duty to act but failed to to do so. 15. The plaintiffs have no other remedy available to them in law or equity. 16. If this court does not act, the plaintiffs will suffer irreparable harm and unfair prejudice. DONE AND ORDERED in Chambers, at Atlanta, Georgia, this day of August, 2009. ni.ed States 914 Court Judge United States Court of Appeals Eleventh Circuit Copies to: IRS, Plantation Office EFTA00729505 FBI, Miami Office U.S. Dept of Treasury, Washington, D.C. Clerk of Court, United States District Court EFTA00729506