Butler v. Nassau Regional Off-Track Betting Corporation et al, Case No. 2:07-cv-01472 in the New York Eastern District Court. ... Board of Directors of Nassau Regeional Off-Track Betting Corporation, Defendant.
beneath the sham protective order in the butler case is material for many indictments
legal fees a time honored way to wash money and engage in. kickbacks?
beneath the sham protective order in the butler case is material for many indictments
legal fees a time honored way to wash money and engage in. kickbacks?
De Blasio Investigations Cost Taxpayers Millions in Legal Fees
City Hall has spent at least $5.4 million for lawyers related to fundraising probes; mayor denies wrongdoing
New York City Mayor Bill de Blasio at a news conference at City Hall. PHOTO: STEVE REMICH FOR THE WALL STREET JOURNAL
New York City Mayor Bill de Blasio’s administration has spent at least $5.4 million in taxpayer money on lawyers related to state and federal investigations into his fundraising activities, according to a person familiar with the matter.
Work continues into several of the investigations, and the fees to local law firms are likely to climb further, this person said. The current tally represents fees through early October, the person said.
Investigators are looking at whether Mr. de Blasio, a Democrat, exchanged government actions for donations, according to people familiar with the matter. Several of the mayor’s closest allies have received subpoenas as part of the investigation.
Neither the mayor nor his allies have been accused of wrongdoing, and Mr. de Blasio has said he and his staff have followed all laws.
Most of the legal fees were paid to Debevoise & Plimpton LLP, a white-collar law firm representing the mayor’s office and city officials involved in the investigations. The fees covered reviewing and producing documents for prosecutors and preparing city employees for interviews, this person said.
EARLIER COVERAGE
- New York City Mayor Bill de Blasio Distracted by Investigations, Observers Suggest (May 26)
- Fundraising Probes Cloud Bill de Blasio’s Political Standing (May 16)
- Mayor Defends Fundraising in Wake of Subpoenas (April 28)
- Mayor’s Political Allies, City Hall Subpoenaed in Fundraising Probes(April 27)
- Besieged de Blasio Zooms In on Agenda (April 26)
- De Blasio’s Ties to Real-Estate Industry Are Scrutinized (April 22)
- U.S. Attorney Probes Manhattan Land Deal (April 12)
- Bill de Blasio Defends Fundraising as Probe Widens (April 10)
- Federal Probe Expands to Nonprofit Tied to New York Mayor Bill de Blasio(April 9)
A spokesman for the law firm declined to comment.
The city has spent about $400,000 with Carter Ledyard & Milburn LLP, which has represented the administration in the investigations involving the city’s decision to lift deed restrictions at Rivington House, a Manhattan health-care facility.
Earlier this year, several months after a city agency removed the deed restrictions, the building’s owner sold Rivington House to a group of developers that plan to build luxury housing, making what appears to be a $72 million profit.
The lawyers have charged from $600 to $800 an hour, the person familiar with the legal fees said. That means lawyers have worked from 7,000 to 9,000 hours on the investigations.
Legal fees have proven so steep that the city’s Office of Management and Budget plans to modify the annual budget and include the fees in an updated budget document later this month, this person said.
‘If you need a top-flight person, you have to pay. For some of the top, top lawyers, the average [rate] can even go north of $1,000.’
The mayor’s office is required to inform city Comptroller Scott Stringer, a fellow Democrat who is considering challenging Mr. de Blasio’s re-election bid next year, about the fees, this person said.
At least some of Mr. de Blasio’s legal fees are being paid by his campaign account, this person said. He is being represented by Barry Berke, a lawyer at Kramer Levin Naftalis & Frankel LLP. Additionally, Ross Offinger, Mr. de Blasio’s fundraiser, is being represented by Boies, Schiller & Flexner LLP. Those fees aren’t being covered by the city.
Peter Zeughauser, a leading consultant on lawyers, said the hourly fees may sound expensive but are “market rate” for top law firms.
“If you need a top-flight person, you have to pay,” he said. “For some of the top, top lawyers, the average [rate] can even go north of $1,000.”
Michael Hess, the city’s top lawyer under former Mayor Rudy Giuliani, said his administration rarely hired outside lawyers because the Law Department already had hundreds of attorneys. But in this situation, he said, it likely made sense to engage outside counsel.
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“We didn’t have anything like that going on,” Mr. Hess said. “It probably makes sense to hire lawyers for that. There isn’t a lot of expertise in the Law Department about possible criminal investigations into the city.”
Still, the lawyer fees could prove damaging to Mr. de Blasio politically. For years as investigations stretched on into New Jersey Gov. Chris Christie’s administration, his team released information, usually on Friday afternoons, about rising legal bills. Eventually, Mr. Christie’s administration paid more than $10 million to lawyers.
Ken Sherrill, a professor emeritus of political science at Hunter College, said voters “probably wouldn’t go for or against” Mr. de Blasio based on high legal fees.
“But it doesn’t sound good. It doesn’t smell good,” he said. “It’s tax money that could be spent on better things.”
Write to Josh Dawsey at JOSHUA.DAWSEY@dowjones.com
