Showing posts from April, 2009


Attorney General Andrew M. Cuomo today announced the takedown of a highly organized drug distribution organization which spanned from Southern California to western New York. During the investigation, approximately one and a half kilograms of cocaine, more than 650 grams of marijuana, and approximately $200,000 cash were seized.

Three separate indictments charge 25 people with crimes including Criminal Possession and/or Sale of Cocaine (class A-I felony), Conspiracy to Possess and Sell Cocaine (class B felony), Conspiracy in the Second Degree (class B felony) and Conspiracy in the Fourth Degree (class E felony), Criminal Sale of Marihuana in the Second Degree (class D felony), and Criminal Possession of Marihuana in the Third Degree (class E felony).

Today’s indictments are the result of a 19-month, multi-agency investigation dubbed “The City’s Finest,” which was led by the Attorney General’s Organized Crime Task Force (OCTF) and the New York State Police Community Narcotics Enforcement…

Computer Administrator Pleads Guilty to Hacking Former Employer’s Computer System

The former director of information technology for a non-profit organ and tissue donation center has entered a guilty plea to intruding into her former employer’s computer network.

At a hearing before U.S. District Judge David Hittner, Danielle Duann, 51, admitted to illegally accessing the computer network of LifeGift Organ Donation Center and then intentionally deleting organ donation database records, accounting invoice files, database and accounting software applications and various backup files without authorization.

LifeGift is the sole provider of organ procurement services for more than 200 hospitals throughout 109 counties in North, Southeast and West Texas. Duann was previously indicted on this charge by a federal grand jury on June 24, 2008.

According to the statement of facts in the case, LifeGift terminated Duann from her position as their director of information technology on Nov. 5, 2005, and the organization revoked all of Duann’s previous administrative rights and access …

Justice Department Sues Nobel Learning Communities Inc.

The Justice Department announced today it has filed a lawsuit in U.S. District Court in Philadelphia against Nobel Learning Communities Inc. (Nobel) alleging the company violated Title III of the Americans with Disabilities Act by excluding children with autism spectrum disorders and other disabilities from its schools and programs.

The complaint identifies children with disabilities denied admission to or removed from Nobel schools in several states. Nobel is a network of more than 180 private preschools, elementary schools and secondary schools in fifteen states, operating under various names including Chesterbrook Academies, Evergreen Academies, Bethesda Country Day School and Merryhill Schools. Nobel also provides child care services and summer programs.

"All parents want their child to have the opportunity to reach his or her full potential," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department will vigorously en…


Attorney General Andrew M. Cuomo today announced that his Medicaid Control Fraud Unit (MFCU) recovered over $263 million in damages and restitution from cases of provider fraud across New York State in 2008.

According to MFCU’s 2008 Annual Report, which was submitted today to the U.S. Department of Health and Human Services, the Unit obtained nearly 150 convictions last year, the highest number in the last five years. The Unit also secured settlements and court orders requiring the payment of $263.5 million in civil damages and criminal restitution, surpassing the $113.8 million achieved in 2007 and $59.3 million in 2006.

“2008 marks a truly landmark year for New York’s Medicaid Fraud Control Unit,” said Attorney General Cuomo. “Through efficient use of our resources and a steadfast commitment to the patients of New York State, we were able to more than double the money recovered in cases of provider fraud and hold accountable individuals and companies that abuse or neglect their pati…


Attorney General Andrew M. Cuomo today announced that his office has filed suit against National Home Protection, Inc. (NHP), a New York City-based company, and three principals, Leo Serrur, David Seruya, and Victor Hakim in New York Supreme Court in Manhattan for a deceptive home warranty scheme that defrauded consumers in New York and across the country out of hundreds of thousands of dollars.

The Attorney General also applied for and was granted a temporary restraining order freezing the bank accounts and other assets of the company and principals, and preventing NHP from selling any more of its home warranty plans out of New York pending further order by the Court.

“This company denied homeowners’ legitimate claims, deceived consumers with false advertising, and ultimately ripped off customers who paid good money to protect their investment,” said Attorney General Cuomo. “This was an ongoing fraud that systemically cheated consumers across this country.”

NHP sells yearly home warrant…

EEOC Meeting on Race and Color Discrimination of April 19, 2006, Washington D.C.

Good Morning. I am Michael L. Foreman, Deputy Director of Legal Programs, appearing for Barbara R. Arnwine, Executive Director of the Lawyers’ Committee for Civil Rights Under Law (“Lawyers' Committee”). In 1963, the Lawyers' Committee was formed at the direction of President John F. Kennedy to focus the efforts of our nation’s bar to advance, through the rule of law, equal justice under the law. Since that time, the Lawyers' Committee has been at the forefront in advancing equality and access in the areas of education, housing, voting rights, community development, and minority business opportunities.

Title VII has not had a more active partner in the fight against unlawful discrimination in the workplace than the Lawyers' Committee. We worked tirelessly with a broad coalition of organizations to secure the passage of the Civil Rights Act of 1991 which overturned a series of U.S. Supreme Court decisions that were adverse to certain provisions of Title VII. In our c…


Attorney General Andrew M. Cuomo today announced that Wal-Mart and Target, the two largest retail chain stores in the United States; Duane Reade, the largest pharmacy chain in New York City; and Costco Wholesale Corporation, the largest wholesale club operator in the country, have agreed to provide New York customers with prescription medication instructions in their primary language. In addition, A & P, one of the largest supermarkets on the East Coast operating Pathmark, Super Fresh, and Food Emporium among others, also entered into the same agreement with the Attorney General. Under the terms of these agreements, the companies will counsel all pharmacy customers about prescription information in their own language and provide written translations in Spanish, Chinese, Italian, Russian, and French.

The agreements announced today are the result of an undercover investigation into the policies and procedures of pharmacies, conducted by the Attorney General’s Office, which found tha…

U.S. Labor Department announces release of $100.4 million in unemployment insurance modernization incentive funds to Illinois

The U.S. Department of Labor today certified for release $100,383,562 in unemployment insurance (UI) modernization incentive funds to the state of Illinois. Illinois qualified for the funds available under the American Recovery and Reinvestment Act (Recovery Act) by allowing workers to use their more recent earnings to qualify for benefits. Illinois' approved application will be posted at the department's Employment and Training Administration Web site at:

"Illinois recognizes the importance of providing an economic safety net to workers who have entered the workforce recently and lost their jobs through no fault of their own," said Secretary of Labor Hilda L. Solis. "It is the right thing to do for workers and is good for the state's economic recovery."

The Illinois Department of Employment Security can use the funds to pay unemployment benefits or, if appropriated by the legislature, for administering its unemployment in…

Kellogg Settles FTC Charges That Ads for Frosted Mini-Wheats Were False

Kellogg Company, the world’s leading producer of cereal, has agreed to settle Federal Trade Commission charges that advertising claims touting a breakfast of Frosted Mini-Wheats as “clinically shown to improve kids’ attentiveness by nearly 20%” were false and violated federal law. The proposed settlement bars deceptive or misleading cognitive health claims for Kellogg’s breakfast foods and snack foods and bars the company from misrepresenting any tests or studies.

According to the FTC’s complaint, Kellogg claimed in a national advertising campaign – including television, print, and Internet advertising, as well as product packaging – that a breakfast of Frosted Mini-Wheats cereal is clinically shown to improve children’s attentiveness by nearly 20 percent. The complaint alleges that, in fact, according to the clinical study referred to in Kellogg’s advertising, only about half the children who ate Frosted Mini-Wheats for breakfast showed any improvement in attentiveness, and only about…

Subsidiaries of Swedish Company, Trelleborg AB, Agree to Plead Guilty and Pay $11 Million in Criminal Fines

Two subsidiaries of the Swedish company Trelleborg AB, one based in Virginia and the other in France, have agreed to plead guilty and pay a total of $11 million in criminal fines for their participation in separate conspiracies affecting the sales of marine products sold in the United States and elsewhere, the Department of Justice announced today.

A two-count felony charge was filed today in U.S. District Court in Norfolk, Va., against Virginia Harbor Services Inc., formerly known as Trelleborg Engineered Products Inc. (VHS/TEPI), a manufacturer of foam-filled marine fenders, buoys and plastic marine pilings headquartered in Clearbrook, Va.

According to the charges, VHS/TEPI participated in a conspiracy between December 2002 and August 2005 to allocate customers and rig bids for contracts to sell foam-filled marine fenders and buoys, and also participated in a separate conspiracy between December 2002 and May 2003 to allocate customers and rig bids for contracts to sell plastic marine …

Former Gary, Indiana, Police Chief Sentenced for Federal Civil Rights Violation

Acting Assistant Attorney General Loretta King of the Civil Rights Division announced today that Thomas Houston, former Chief of the Gary, Ind., Police Department, was sentenced to 41 months in prison followed by two years of supervised release for violating the civil rights of a Gary resident in June 2007.

Houston was convicted in Sept. 2008 of assaulting the victim, identified in court documents as V.A., by striking and kicking him in the stomach while he was handcuffed, resulting in contusions to his face, head, chest and abdomen. Houston, a 42-year veteran of the department, had been chief for just seven days when he committed the assault. He resigned from the post shortly after being indicted in March 2008.

Evidence presented during the six-day trial revealed that Houston’s home was burglarized on June 1, 2007, and that he incorrectly believed that a neighbor was responsible for the burglary. Houston summoned on-duty officers to leave their posts and accompany him to the neighbor’s…


National department store Nordstrom, Inc. will pay $292,500 to 10 former employees and furnish other remedial measures to settle a harassment lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC), the agency announced today. EEOC had charged that the department store manager harassed Hispanic and black employees based on their national origin, race, and color, and retaliated against those who complained about the harassment.

According to the EEOC’s lawsuit, an alterations department manager complained that she “hate[d] Hispanics,” and that Hispanics were “lazy” and “ignorant.” Hispanic tailors were chastised by the alterations manager for speaking to each other in Spanish. The same manager made other derogatory remarks such as “I don’t like blacks” and “you’re black, you stink.” The alterations manager harassed the alterations staff at Nordstrom stores in Palm Beach Gardens and Wellington, Fla.

The employees complained to Nordstrom about the harassment, but the haras…

Louisiana Tax Defier Convicted on Federal Tax Charges

Following three and a half days of trial and 19 minutes of deliberations, a Gulfport, Miss., federal jury yesterday convicted Paul Richard Arceneaux, a resident of Church Point, La., of tax crimes, the Justice Department announced. Arceneaux, who owned and operated Speedy Cash Inc. in Gulfport, was convicted of all counts of the indictment charging him with corruptly interfering with the Internal Revenue laws and failing to file his income tax returns for 2003 and 2004.

U.S. District Judge Walter J. Gex III, scheduled sentencing for July 15, 2009. Arceneaux faces potential maximum sentences totaling five years’ in prison followed by one year of supervised release, $450,000 in criminal fines and costs of prosecution.

According to the indictment, Arceneaux, formerly of Long Beach, Miss., filed fictitious liens for millions of dollars against the Chancery Clerk for Harrison County, an employee of the Chancery Clerk’s office and an employee of the IRS. Arceneaux also filed frivolous lawsuit…

Public Hearing in Berkeley, California, to Focus on Intellectual Property

The Federal Trade Commission today announced the fifth and final hearing in a series exploring the evolving market for intellectual property. This hearing will be held May 4-5, 2009, on the campus of the University of California at Berkeley, in cooperation with the Berkeley Center for Law and Technology and the Berkeley Competition Policy Center. It will explore how markets for patents and technology operate in different industries, whether those markets operate efficiently, and how patent policy might be adjusted to respond to problems in those markets in order to better promote innovation and competition.

This hearing is part of an ongoing series examining changes in patent law, patent-related business models, and new learning about the operation of markets for IP and technology since the October 2003 Commission report on the patent system, “To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy.”

U.S. Labor Department's OSHA orders Southern Air Inc. to withdraw retaliatory lawsuit and pay more than $7.9 million to 9 whistleblowers

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) has ordered Southern Air Inc., a Norwalk, Conn.-based air cargo carrier, to withdraw a lawsuit it filed against nine former employees and pay them more than $7.9 million in wages, damages and legal fees.

Southern Air filed a defamation lawsuit against the former employees in Connecticut Superior Court in May 2008 after some of the workers raised air carrier safety concerns with Southern Air, OSHA and the Federal Aviation Administration (FAA). The workers, all former flight crew members, subsequently filed a whistleblower complaint with OSHA.

OSHA's investigation found that the company's lawsuit was filed in retaliation for the workers' protected activities under the whistleblower provisions of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR21).

"This order sends a strong and clear message that these and other workers have the right to raise safety issu…


Attorney General Andrew M. Cuomo announced on 04/06/09 charges against J. Ezra Merkin and the funds he controlled for violating New York’s Martin Act by concealing from his clients the investment of more than $2.4 billion with Bernard L. Madoff. In a 54-page complaint filed in New York State Supreme Court, Cuomo alleges that investors, including several prominent charities and non-profits, entrusted their investments to Merkin, who then steered the money to Madoff without their permission, in exchange for $470 million in management and incentive fees.

The complaint also charges that Merkin ignored irregularities and other glaring red flags related to Madoff’s investments. As a result, hundreds of investors lost millions in investments, tragically including important charity organizations that were specifically targeted by Merkin. Attorney General Cuomo’s lawsuit seeks payment of damages and disgorgement of all fees by Merkin. The complaint also charges Merkin’s management company, Ga…


Governor David A. Paterson today announced $253 million in affordable housing grants coming to New York through the American Recovery and Reinvestment Act (ARRA). Governor Paterson was the first Governor in the nation to suggest that funding for such housing projects be included in the economic recovery package signed into law earlier this year. These New York projects are the first housing projects in the U.S. to be awarded funding through the ARRA, and will allow for the preservation of existing affordable housing as well as the construction of new units.

The first nine projects that will receive financing include the rehabilitation of an 80-unit complex in Albany, a 388-unit Mitchell Lama complex in Syracuse, 20 three-bedroom homes in Rochester, and a YWCA Residence for Women in Westchester County. The ARRA included $2.25 billion for the Tax Credit Assistance Program (TCAP), which will help State housing agencies kick-start the production of stalled projects that rely on low-income…

Lobbyist Sentenced for Destroying Evidence in Public Corruption Investigation

A partner in a Pennsylvania-based lobbying firm was sentenced today by U.S. District Judge Henry H. Kennedy Jr., to five months of home detention for destroying evidence in connection with a public corruption investigation, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division, U.S. Attorney Jeffrey A. Taylor for the District of Columbia, Assistant Director of the FBI’s Washington Field Office Joseph Persichini Jr., and Special Agent in Charge C. André Martin of Internal Revenue Service (IRS) Criminal Investigation announced.

Cecelia Grimes, 43, of Parkesburg, Penn., was also sentenced to three years probation and ordered to pay a $3,000 fine. Previously, on July 25, 2008, Grimes pleaded guilty before Judge Kennedy in U.S. District Court for the District of Columbia. According to the evidence presented in court documents and at the plea hearing, Grimes was a registered lobbyist whose firm submitted requests for appropriations to the office of a member of the …

U.S. Sues 32 Individuals, Alleging $30 Million Tax Credit Scam

The United States has sued four Certified Public Accounts (CPA), 27 tax preparers and one other individual, seeking to bar them from promoting an alleged tax scam involving bogus income tax credits claimed for sham sales of methane from landfills, the Justice Department announced today.

According to the civil injunction lawsuit, filed in Tampa with the U.S. District Court for the Middle District of Florida, George Calvert of Hernando Beach, Fla., and Gregory Guido of Lithia, Fla., concocted a scheme that involves creating bogus business records purportedly documenting sales of methane from landfills in Puerto Rico, Illinois, New York, Ohio and Connecticut. The suit alleges that there were no methane sales, but that the defendants helped their customers claim tax credits based on the purported sales. Federal law allows an income tax credit with respect to certain sales of fuel from non-conventional sources, including methane produced from landfills.

The government complaint alleges that …