U.S. Judge Tells Law Firms: Turn Over Scam Records To FTC
A Manhattan federal judge on Thursday ordered Los Angeles-based Manatt, Phelps & Phillips to turn over records relating to a $704,000 payment the law firm received in 2014 from an alleged scam artist whom the US Federal Trade Commission is prosecuting, David Thomas reported for Reuters.
Photo Insert: The Federal Trade Commission
US District Judge Lorna Schofield also ordered BakerHostetler and Boies Schiller Flexner to turn over to the FTC seven documents Manatt had forwarded to those firms. If BakerHostetler and Boies Schiller can't turn them over within a week, the firms have to explain why Schofield said.
The documents in question are emails that were exchanged in September 2014 between a former Manatt partner, an alleged scam artist BakerHostetler is now representing, and a third-party attorney.
Schofield said BakerHostetler and Boies Schiller would have to submit letters to justify why these emails are privileged and could not be submitted to the FTC. If the firms say they are privileged, Schofield said she would review the emails privately.
BakerHostetler is representing Burton Katz and Boies Schiller is representing Robert Zangrillo over allegations the two men ran a "sprawling online scheme" that bilked customers out of money and their personal information through websites that purportedly offered easy access to government services.
Manatt represented Katz in 2014 over allegations that he was running a phone bill-cramming scheme that resulted in customers getting hit with unauthorized charges on their cellphone bills. Katz settled the cramming charges with the FTC in 2014, and Zangrillo, Katz's business partner, cut a $704,000 check to Manatt in connection with that settlement.
The FTC is trying to hold Zangrillo, Katz, and others in civil contempt for allegedly violating the 2014 settlement with its government service access scam. Christopher Erickson, an FTC attorney, told Schofield the trial is expected to start in late October.