Category Archives: Legal News

Largest lawsuit against an auditor goes to court for $5.5 billion

Colonial Bank in Miami Beach, on August 17, 2009, days after it failed. The bank’s fraud with Taylor, Bean & Whitaker is the subject of a lawsuit against its auditor, PricewaterhouseCooper, which failed to catch the fraud for seven years. John VanBeekum Miami Herald

The largest-ever lawsuit against an auditing firm is set to open Monday in a Miami-Dade County Circuit Court, pitting Big Four firm PwC against a trustee of the defunct Taylor, Bean & Whitaker Mortgage Corporation.

At stake: $5.5 billion.

The lawsuit was filed in 2013 by a trust formed following the bankruptcy of Ocala-based Taylor, Bean & Whitaker, which in the early 2000s was one of the nation’s largest mortgage companies. The firm was raided by federal agents in 2009 for its part in a seven-year, multibillion-dollar fraud scheme with Colonial BancGroup.

According to the lawsuit, the fraud went undetected by PwC, the independent public auditor in charge of auditing Colonial, as a result of “gross negligence.”

The $5.5 billion action is one of a wave of suits against major auditing firms, including PwC, in the aftermath of the 2009 banking crisis. Most have alleged faulty work, said Jonathan Perlman, equity partner at Miami-based firm Genovese Joblove & Battista, who has prosecuted several cases against auditing firms. A majority of the cases have settled, including a suit brought against PwC for the alleged negligent auditing of failed brokerage MF Global Holdings Ltd. PwC paid $65 million in a settlement.

Few of the suits have gone to trial, Perlman said.

Still, Steven Thomas, lead trial lawyer for the trust, said he is confident this suit will succeed.

Thomas, who has has obtained several multimillion-dollar settlements and verdicts in cases involving negligent audits, said PwC’s alleged negligence is the “worst” of any case he’s had.

As early as 2002, six top executives at Taylor, Bean & Whitaker, including chairman Lee Farkas, colluded with two executives at Colonial to sign off on mortgage sales that didn’t exist. Colonial financed Taylor, Bean & Whitaker’s mortgages, but in order to bypass the federal lending limit, Colonial started registering loans from the mortgage company as sales instead.

Circumventing the lending limits allowed the fraud to grow exponentially as executives at each company worked to falsify documents and computer entries and shift money between Colonial bank accounts. Both Colonial and Taylor, Bean & Whitaker were raided on Aug. 3, 2009, and later filed for bankruptcy, leading to the sixth-largest banking failure in U.S. history.

Farkas was sentenced to 30 years in federal prison. Catherine Kissick at Colonial, who worked most closely with Farkas, received eight years in prison as part of a plea deal.

 

Feds: Ex-mob boss Salemme, nabbed for murder, was on the run

This is a photo released by the FBI showing reputed New England Mafia leader Francis P. “Cadillac Frank” Salemme, after his arrest Aug. 11, 1995, in West Palm Beach, Fla. Salemme has been charged with lying to investigators about his role in the 1993 killing of a nightclub owner in order to get a shorter sentence for his racketeering conviction. Salemme, 71, was charged in 1995 with participating in eight murders. He pleaded guilty and agreed to cooperate with federal investigators. He was astar witness for the government in the trial of corrupt FBI agent John Connolly Jr. (AP Photo/FBI)

By MATT STOUT

Former New England mafia godfather Frank “Cadillac” Salemme was ordered held without bail today on charges he murdered a federal witness after prosecutors say he went on the run from a witness protection program.

Salemme, appearing in federal court today wearing baggy brown pants, sneakers and a blue t-shirt, did not challenge a detention order and waived his right to a probable cause hearing before being led away in handcuffs.

The 82-year-old mobster was smiling at times and even joking during his brief court appearance: As he was led into the courtroom, he quipped to long-time federal prosecutor Fred Wyshak, “Fancy seeing you here.”

Salemme is charged with the murder of a witness on May 10, 1993, according to a criminal complaint. Wyshak confirmed outside the courtroom that the murdered witness, who was not named in court, was nightclub owner Stephen DiSarro.

According to an indictment of another aging former mobster made public earlier this summer, Salemme and his son, Frank Salemme Jr., murdered  DiSarro on that date. DiSarro’s remains were found behind a mill in Providence in late March.

The initial Salemme revelation came in the indictment in June of ex-La Costa Nostra gang member Robert P. DeLuca, 70, on charges of lying to federal investigators about DiSarro’s disappearance and murder.

The Salemmes had a “hidden interest” in DiSarro’s Channel club, and that relationship came up during criminal investigations in the early 1990s, according to the DeLuca indictment.

The indictment on the murder charges against Salemme has been sealed from the public.

Salemme, who was the boss of the New England La Cosa Nostra in the 1990s until he was indicted on racketeering charges in 1995 and convicted in 1999, was arrested this morning in Connecticut.

Salemme was “fleeing from potential prosecution” and had left his home in Atlanta, Ga., Wyshak said.

Salemme’s lawyer, Steven Boozang, denied that his client was on the run.

“He was on his way back to answer any charges,” Boozang told reporters after the hearing. He said Salemme denies the charges and is determined to bring the case to trial.

Sourced From – http://www.bostonherald.com/news/local_coverage/2016/08/feds_ex_mob_boss_salemme_nabbed_for_murder_was_on_the_run

Why Ed Sheeran should be worried about allegedly copying a Marvin Gaye song

Remember the “Blurred Lines” lawsuit? Well, it set a precedent.

By Danielle Cheesman

To all the brides and grooms who chose Ed Sheeran‘s 2014 hit “Thinking Out Loud” to serve as the soundtrack to their first dance, your marriage is doomed.

Just kidding.

But the track’s legacy is at risk of being tarnished. The song—which was the first to ever to hit 500 million streams on Spotify and won Song of the Year at this year’s Grammy Awards—is being sued by the family of Ed Townsend, who co-wrote and created the musical composition of Marvin Gaye‘s “Let’s Get It On,” for copyright infringement of the 1973 classic.

How so, you might ask, since it samples no beat and borrows no lyrics?

Because of its “heart.” No, really.

Hip-Hop celebrates the life of Marvin Gaye with samples

According to Reuters, the lawsuit, filed in federal court in the Southern District of New York, claims that “the Defendants copied the ‘heart’ of ‘Let’s’ and repeated it continuously throughout ‘Thinking.’ The melodic, harmonic, and rhythmic compositions of ‘Thinking’ are substantially and/or strikingly similar to the drum composition of ‘Let’s.'”

While this may sound like a reach, what Sheeran has working against him is that Gaye grip. The force they flex.

While the Gaye family is not technically involved in Townsend’s suit against Sheeran, let’s not forget that their estate won $7.3 million last year in their lawsuit filed against Pharrell Williams and Robin Thicke over the duo’s “Blurred Lines” smash, a song they alleged soundedtoo similar to Gaye’s “Got To Give It Up.”

In that case, Williams and Thicke dismissed the family’s argument,writing that “the basis of the Gaye defendants’ claims is that ‘Blurred Lines’ and ‘Got To Give It Up’ ‘feel’ or ‘sound’ the same. Being reminiscent of a ‘sound’ is not copyright infringement.”

Well, their $7.3 million loss says otherwise.

And it became the record high judgment in a copyright infringement suit. So that’s saying something.

A real, authorized Marvin Gaye documentary is finally coming

“Blurred Lines” didn’t go down without a fight though. Back when it was released, even Questlove tried to weigh in with his support for his fellow contemporaries, telling Vulture:

“I’m siding with Robin Thicke; I’m going against the estate of Marvin Gaye. Look, technically it’s not plagiarized. It’s not the same chord progression. It’s a feeling. Because there’s a cowbell in it and a fender Rhodes as the main instrumentation — that still doesn’t make it plagiarized. We all know it’s derivative. That’s how Pharrell works. Everything that Pharrell produces is derivative of another song — but it’s an homage. If it were a case of melodic plagiarism, I would definitely side with the estate. But in this case…I’m still siding with Pharrell and Robin on this one.”

Note Quest’s use of the word “feeling.”

And note this writer’s use of it, as well. Here’s how SPIN‘s Andrew Unterberger—who noticed the similarities over a year ago, before anyone else (and maybe even Townsend) did—wrote about the two current songs in question:

“[‘Thinking Out Loud’] is also an incredibly obvious successor to Marvin Gaye’s 1973 superlative slow jam ‘Let’s Get It On’ — the gently loping four-note bass pattern and crisp ’70s soul drums absolutely smack of the Gaye classic, as do the embrace-insistent lyrics and general candlelit-bedroom feel.”

There it is again.

The point is, Williams and Thicke had to pay up. And if this new precedent set is all about vibesss, there’s a good chance Sheeran will too.

Full Article – https://revolt.tv/stories/2016/08/10/ed-sheeran-worried-allegedly-copying-marvin-gaye-song-8a3ce18fb7

Deal with mafia not my son, Turkey’s Erdogan tells Italian judges

Erdogan told RAI television that the probe by prosecutors in the northern city of Bologna, where Bilal had been studying, might affect bilateral links. Erdogan, criticised in the West for the scale of a post-coup crackdown, told RAI: “Italy should be attending to the mafia, not my son. If my son came back to Italy at this moment, he could be arrested,”

Erdogan said in an interview with the state broadcaster. “This could even cause problems for our relationship with Italy.”Bilal, 35, went to Italy in 2015 to finish a doctorate. It was not clear when he left, but a legal source said he had been back in Turkey for some time. He denies wrongdoing.

In response, Prime Minister Matteo Renzi said Italy had an independent legal system and “judges answer to the Italian constitution and not the Turkish president.”The money-laundering investigation followed accusations by Murat Hakan Uzan, an exiled member of one of Turkey´s richest families and an opponent of the president, a legal source said.

Italian press reported prosecutors were looking into sums of money allegedly brought to Italy from Turkey. In July, a Bologna court allowed them to extend their investigation by six months.

Bilal’s lawyer Giovanni Trombini said his client declared that “all his economic and financial activity is totally transparent and legal, and the accusations are completely unfounded.”

Bilal, one of the Turkish president’s four children, has shipping and maritime assets and controls several oil tankers through his company and partnerships in other firms.

Sourced From – https://www.thenews.com.pk/print/139692-Erdogan-asks-Italy-to-check-its-mafia-not-his-son

Kesha Drops Her Lawsuit Against Dr. Luke

After a long and heartbreaking legal battle, Kesha has decided to drop her lawsuit against Dr. Luke. Daniel Petrocelli, a member of the singer’s legal team, told Us Weekly in a statement on Monday that Kesha put an end to the ordeal in order to focus on releasing new music. “Kesha has dismissed her California action without prejudice while she pursues her appeal and other legal claims in the New York courts,” Daniel explained. “Kesha is focused on getting back to work and has delivered 28 new songs to the record label. We have conveyed to Sony Music and the label Kesha’s strong desire to release the single and an album as soon as possible.” Kesha spoke out about her decision on Monday, tweeting that her “fight continues,” while Dr. Luke’s attorney, Christine Lepera, claimed that the lawsuit was dropped because the singer “has no chance of winning.”

Kesha first filed a lawsuit against the music producer in October 2015, alleging that he’d emotionally and sexually abused her and manipulated her career. Numerous celebrities, including Lady Gagacame forward to support Kesha in the wake of the shocking news. However, in April 2016, a judge threw out her claims, saying she was being “unreasonable.” Despite the singer’s dramatic year, check out 12 quotes that prove she’s always been a warrior.