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Government Seeks To Quash Spying Suit
Breaking Legal News | 2007/01/26 06:10

The U.S. Justice Department filed court papers in Cincinnati arguing a lawsuit challenging the Bush administration's wiretap program should be dismissed.

The department claims the lawsuit, filed by the American Civil Liberties Union and other plaintiffs, is no longer significant because the National Security Agency's warrantless surveillance program is now being conducted under the supervision of a secret intelligence court, The Washington Post reported Friday.

Justice Department lawyers argued in papers filed with the 6th U.S. Circuit Court of Appeals the suit should be dismissed because it "no longer has any live significance."

The move follows an announcement last week by Attorney General Alberto Gonzales the program, which had allowed the NSA to monitor calls made between the United States and foreign countries without court approval if one of the parties was determined to be linked to terrorism, is being terminated and replaced by a surveillance program overseen by a secret 11-member court.



Suspect in 1964 Mississippi civil rights killings arrested
Breaking Legal News | 2007/01/25 06:50

Federal authorities arrested a Mississippi man Wednesday for the 1964 kidnapping and deaths of two black men in another reopened civil rights-era case. James Ford Seale, now 71 years old, was originally arrested in 1964 on suspicion of kidnapping two young black men, Henry Dee and Charles Moore, who were later found dead in the Mississippi river, but was released due to a lack of evidence after providing information to the FBI.

In 2000, after the Clarion-Ledger reported on the contents of Seale's file, the US Justice Department reopened the case, but the LA Times and later, the Clarion-Ledger reported that Seale had in fact died. Thomas Moore, brother of Charles Moore, had pushed for the case to be reopened again, but authorities hesitated, until the 2005 conviction of Edgar Ray Killen for the civil rights era deaths of three civil rights workers.

Seale will be arraigned Thursday in Jackson, Mississippi, on kidnapping charges.



The PBSJ Corporation Pays $6.4M to Settle Fraud
Breaking Legal News | 2007/01/24 16:41

The PBSJ Corp. (PBSJ), a design and engineering firm based in Florida, has paid more than $6.4 million to resolve claims that it violated the False Claims Act by submitting false and fraudulent claims to the government, the Justice Department announced.

The settlement arises from a $36 million embezzlement scheme that took place between 1992 and 2005 and was perpetrated by PBSJ’s former Chief Financial Officer and two other employees. The scheme involved shifting funds and fabricating entries in the company’s books and records to cover up the fraud, and resulted in PBSJ’s audited overhead rates being overstated.

The settlement also resolves unrelated issues concerning how PBSJ treated certain indirect costs that also contributed to PBSJ’s audited overhead rates being overstated. The inaccurate overhead rates were submitted to the United States in connection with hundreds of contracts with federal agencies for the purposes of contract qualification, contract negotiation, contract billing, and applicable contract and audit reporting requirements. As a result, PBSJ submitted claims to the United States under federal contracts that were false or fraudulent because the claims relied on and incorporated the overstated overhead rates. More than a dozen federal agencies were affected by the fraud, including the Departments of the Army, Transportation, Interior and Homeland Security.

"Companies that enter into contracts with the government must maintain accounting controls and procedures that ensure that the costs and rates that they submit to the government are accurate," said Assistant Attorney General Peter D. Keisler of the Civil Division.

Previously, three individuals responsible for the embezzlement, CFO William Scott Deloach, Maria Garcia, and Rosario Licata, pleaded guilty on Sept. 28, 2006 in the Southern District of Florida and currently await sentencing. The criminal investigation of the individuals was conducted by the U.S. Attorney’s Office for the Southern District of Florida and the FBI, Miami Field Division.

The civil investigation of PBSJ was conducted by the Civil Division of the Department of Justice, the Office of Inspector General for the Department of Transportation, and the Defense Contract Audit Agency.



West Virginia Man Convicted of Child Pornography
Breaking Legal News | 2007/01/24 16:27

WASHINGTON – A Cross Lanes, W. Va. man has been convicted of producing, receiving, and possessing child pornography, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney Charles T. Miller of the Southern District of West Virginia announced today.

Following a five-day jury trial that began last Wednesday, David A. Hicks was found guilty on two counts of producing child pornography, two additional counts of possessing child pornography, and one count of receiving child pornography over the Internet. The trial was held in U.S. District Court in Charleston, W. Va. and U.S. District Court Judge Joseph R. Goodwin presided.

The evidence presented at trial demonstrated that Hicks, a father of two girls under the age of ten, frequently had his older daughter’s friends spend the night as guests. Five of these juveniles, girls between the ages of nine and 12, testified that Hicks frequently took photos of them while they were at the home, commented on his ability to see through their clothing, walked in on them while they were changing or bathing, watched and photographed them through the blinds of the home while they were swimming in his pool, and physically touched more than one of them inappropriately. Hicks stored photos of the girls on his computer in a special archive folder, including photos of his daughter’s friends either nude or partially nude. The two charges of production of child pornography were based on two photos taken in Hicks’s bathtub that depicted one of the girls in a sexually suggestive position.

Evidence at trial also revealed that Hicks was a trained computer expert who maintained a computer in his bedroom that had four separate hard drives. These hard drives contained thousands of images and movies of children engaged in sexually explicit conduct. The images on these hard drives were the basis of one of the possession charges. Investigators also testified that they seized several CDs from Hicks’ bedroom that contained similar images of prepubescent children engaged in sexually explicit conduct. Finally, forensic analysis of the computers and CDs revealed that Hicks searched for sexually explicit movie clips of children using a peer-to-peer file-sharing program, and then downloaded the movie clips to his computer. Hicks’s use of the Internet to download movie clips containing graphic images of prepubescent children engaged in sexually explicit conduct was the basis of the receipt charge.

Sentencing is currently set for April 19, 2007. Hicks faces a minimum sentence of 15 years and up to 30 years in prison for each of the two production charges, a minimum sentence of 5 years and up to 15 years in prison for the receipt charge, and up to 10 years in prison for each of the two possession charges. The judge also approved the forfeiture of the child pornography and related computer equipment seized during the investigation.

This case was investigated by Special Agents Mike Ritzman and Jack Remaly of the FBI. The forensic analysis was conducted by Melinda Cash of the FBI’s Computer Analysis Response Team. The case was prosecuted by Assistant U.S. Attorney Anna Forbes of the U.S. Attorney’s Office for the Southern District of West Virginia and Trial Attorney Steve Grocki of the Child Exploitation and Obscenity Section of the Criminal Division.



Law Firm to pay $18.5 M to Enron's Estate
Breaking Legal News | 2007/01/24 12:46

Texas law firm avoids court action by paying millions to settle potential malpractice claims over Enron advice

A law firm in Texas is to pay Enron's estate $18.5 in settlement over potential malpractice claims pertaining to legal advice the firm allegedly offered the company over asset transactions.

The settlement follows a report by a court-appointed bankruptcy examiner, which stated that the firm may have committed malpractice in approving 28 transactions that involved asset transactions, alleged to have been disguised as sales. The classification of the transactions in such a manner could have allowed Enron to falsely boost its cash flow.

The firm, Andrews Kurth, denied any culpability regarding the advice they gave Enron. 'We have continuously denied wrongdoing and culpability with respect to our work for Enron,' managing partner Howard Ayres said in a statement.

'We felt, though, after the passage of five years, that it was expedient to enter into the settlement to put this matter behind us,' he added.

The Enron estate has not officially sued the law firm for allegedly signing off improper deals.

However, Houston-based firm, Vinson & Elkins, settled bankruptcy-related litigation for $30m last year, after a bankruptcy examiner alleged the law firm may have committed malpractice for failing to respond to red flags about Enron's accounting practices.

A federal bankruptcy judge is still to approve Andrews Kurth's deal.



Bush gives State of the Union
Breaking Legal News | 2007/01/23 22:32

President Bush pressed for comprehensive immigration reform in his State of Union address Tuesday night, urging US lawmakers to take action to secure US borders, enhance interior and worksite enforcement of immigration laws, create a temporary worker program, resolve "without animosity or amnesty" the status of illegal immigrants already in the US, and promote assimilation.

The call contained in a speech otherwise focused on Iraq and various domestic initiatives on health care, energy and education follows the failure of House and Senate negotiators to come up with agreed legislation in the last Republican-dominated session of Congress despite earlier presidential urgings. Observers suggest bipartisan agreement on key points is more likely under new Democratic leadership, although perhaps without the same emphasis on strict enforcement measures like border fencing that proved controversial earlier this year, although the President did sign a law authorizing a 700-mile-long barrier along the Mexican border.

President Bush also called on members of the Senate to give his latest judicial nominees what he labeled a "fair hearing" and a "prompt up-or-down vote," saying that he and lawmakers have a shared obligation to ensure that vacancies in the federal courts are filled.



Florida man gets jail for arranging teen sex tours
Breaking Legal News | 2007/01/22 22:42

A Florida man was sentenced today to 250 months in prison and a lifetime of supervised release for conspiring to arrange for men in the United States to travel to Honduras to have sex with young teenage girls, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney Paul I. Perez of the Middle District of Florida announced today.

Gary B. Evans, 58, of Cocoa Beach, Fla., was sentenced today before Chief Judge Patricia C. Fawsett in U.S. District Court in Orlando. Evans was ordered to forfeit his interest in his house, various computers and electronic equipment, and two cashier’s checks totaling $24,000.

Evans was arrested on May 11, 2006, and indicted on May 23, 2006, on one count of conspiring to arrange the travel of an individual for the purpose of engaging in illicit sexual conduct and one count of arranging such travel. After Evans’ computers were seized and examined, agents discovered digital images of minors engaged in sexually explicit conduct. On August 9, 2006, a superseding indictment was returned which added one count of receiving child pornography and one count of possessing child pornography. Evans pleaded guilty on October 23, 2006, before Magistrate Judge David A. Baker to one count of conspiring to arrange for the travel of a person to engage in illicit sexual conduct – specifically, a commercial sex act with a person under 18 years of age.

According to the plea agreement, in August 2005, Evans contacted the operator of a Web site which purported to sell "sex tour" packages to overseas locations. According to the Web site, the tour price would include an under-age companion who would have sex with the traveler. Evans proposed a partnership with the operator of the Web site in which they would jointly operate tours to Honduras and Costa Rica, where clients would pay to have sex with minors. However, the Web site was actually part of an undercover investigation being conducted by FBI agents who are part of the Innocent Images task force based in Calverton, Md.

Starting in September 2005 and continuing for several months, undercover agents exchanged several emails, and had numerous online and phone conversations with Evans and his associate in Honduras. Ultimately, Evans agreed to arrange for two clients to travel to Honduras to engage in sex with two girls, ages 16 and 14 respectively. The ultimate price for the hotel, expenses and sex was $2,260, paid in three installments.

On May 6, 2006, undercover agents from the Department of Homeland Security’s U.S. Immigration and Customs Enforcement (ICE) met three associates of Evans in Honduras. The three associates ultimately brought two girls, who appeared to be between the ages of 14 and 16, to the hotel. After briefly meeting the girls, the undercover agents told the associates that they had to return to the United States to attend to an emergency. At that point, the girls safely left the hotel.

As part of the plea agreement, Evans admits he possessed images of real children engaged in sexually explicit conduct. He also admits that the images depicted prepubescent children, and children engaged in sadistic or masochistic conduct. He further admits he possessed more than 150 images of child pornography. Finally, Evans admits that during the time of the offense, he engaged in a pattern of activity involving the sexual abuse and exploitation of minors.

This case is being investigated by ICE and the FBI. The Brevard County, Fla. Sheriff’s Office is also assisting. This case is being prosecuted by Assistant U.S. Attorney Vincent Citro of the Middle District of Florida and Trial Attorney Alexandra Gelber of the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division.



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