Thursday, February 19, 2009

Madoff Attorney Uses Savvy and Likability to Protect a Despised Client

Madoff Attorney Uses Savvy and Likability to Protect a Despised Client

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Ira Lee Sorkin has the challenging task of representing one of the most hated men in America: Bernard L. Madoff, who is accused of ripping off hundreds of celebrities, nonprofit organizations and ordinary investors through a $50 billion Ponzi scheme.

One of Sorkin's colleagues had a succinct response when asked how he would handle the case of Madoff, 70, who was turned in by his sons and allegedly admitted his crime to FBI agents.

"I'd pray," he said.

But if Sorkin is concerned about the task he faces, he did not show any trace in a more than one-hour interview last week.

Indeed, Sorkin, the 65-year-old former head of the New York office of the Securities and Exchange Commission known as Ike, spoke in a relaxed, measured manner about a wide range of topics.

"A lawyer's first role is to protect the client," Sorkin said, but "sometimes there is a perception issue that may be a part of protecting your client's rights."

Legal observers agree that, when all is said and done, Sorkin eventually will have to accept a deal that includes substantial jail time for Madoff. For the moment, however, they give him credit for keeping his client out of jail since his Dec. 11 arrest.

A keen observer of the press and public opinion, Sorkin said he actually proposed stricter bail conditions than he had initially negotiated with the government.

According to Sorkin, prosecutors had agreed to release Madoff on a $10 million bond secured by his East 64th Street apartment, which is in the name of his wife, Ruth. The original agreement permitted Madoff to travel within three federal court districts in the metropolitan area.

But with the rising public outcry against Madoff's continued freedom, Sorkin said he agreed to have his client confined to his home and to foot the bill for private security guards to enforce the arrangement.

Sorkin said he agreed to the strict bail conditions "in anticipation" that the government, in response to the mounting public pressure, would seek to revoke bail.

Sorkin said he believed it was in Madoff's "best interests" to have strict confinement conditions in place should the government pursue that course.

The government did move to revoke bail after it discovered that Ruth Madoff had mailed $1 million in watches and jewelry on Christmas Eve to family members and friends in violation of an SEC freeze on his assets.

Sorkin told the court the gifts were "a few sentimental personal items" and said that the decision to mail them had been an honest mistake. In any case, he said in the interview that prosecutors were using the episode as an "excuse" to seek the jailing of his increasingly unpopular client.

But by then, the strict conditions had been in place since Dec. 19 -- five days before prosecutors charged that Ms. Madoff had violated the freeze order -- and the government could not convince the court that the status quo should be changed. Southern District Magistrate Judge Ronald Ellis and then-District Court Judge Lawrence M. McKenna kept the bail arrangement in place with several relatively minor additions.

It was "no mean feat" for Sorkin, who is representing "a guy who has apparently confessed to a $50 billion fraud, ostensibly violated a court order, and may have assets abroad," said one white-collar criminal defense attorney in Manhattan.

Sorkin "deserves a pat on the back for keeping Mr. Madoff out of jail," said another.


The representation of Madoff has brought other trials with it, Sorkin said. He has received one death threat that warranted reporting to the FBI, and about a dozen anti-Semitic e-mails.

The widespread publicity even ensnared Sorkin at one point.

His name was on a list of more than 13,000 Madoff client accounts in a filing made in the bankruptcy of Bernard L. Madoff Securities, which led to articles questioning whether he had an ethical conflict.

Sorkin swatted away that notion, saying the account referred to in the bankruptcy filing was a retirement account belonging to his father and then his mother after his father died in 2001. As his mother's health declined, he said he received her mail for several years before her death in 2007, when the account was closed out.

"There is no conflict," Sorkin said, "because I was never a client, customer or had any beneficial interest in an account at the Madoff firm."

Sorkin also reported that, despite widespread concern in Jewish circles that Madoff has brought shame on all Jews, he has received no criticism from members of his temple or from board members of the American Friends of the Hebrew University of Jerusalem, where he is chairman.


Sorkin has known Madoff since the 1980s, when a former partner, Howard Squadron, of Squadron Ellenoff Plesent & Sheinfeld, introduced the two. Sorkin declined to comment on his retainer from Madoff or other aspects of his work for him.

Representing Bernard Madoff are Dickstein Shapiro attorneys, from left, Daniel J. Horowitz, Nicole P. De Bello, Ira Lee Sorkin and Mauro M. Wolfe.

To assist him on the Madoff matter, Sorkin has enlisted three members of the 15-lawyer securities enforcement and white-collar defense group of Dickstein Shapiro, which he co-heads.

The team includes partners Daniel J. Horowitz, a former assistant district attorney in Manhattan, and Mauro M. Wolfe, who was an assistant U.S. attorney in New Jersey and previously worked for the SEC in Philadelphia. Associate Nicole P. De Bello rounds out the group.

Among the matters Sorkin is handling for Madoff is the Southern District criminal case and a civil action filed by the SEC. The lawyers also are responsible for representing Madoff's interests in connection with the bankruptcy of his securities firm.

The next court date in Madoff's case is March 13 when the government faces a deadline for filing an indictment against him. Prosecutors have twice asked for a 30-day extension of the deadline, citing the need for "additional discussions regarding a possible disposition."

Sorkin also represents Ruth Madoff. Massachusetts securities regulators reported last week that in the days before the scandal broke, Ms. Madoff had withdrawn $15.5 million from an account she had in a brokerage firm in which Mr. Madoff holds a minority stake, including $10 million the day before her husband was arrested.

Sorkin had no comment on the Massachusetts report.

Ira Sorkin, 65

Partner and co-leader of the securities compliance and white collar practice group, Dickstein Shapiro, 2005 to present;

Partner, Carter, Ledyard & Milburn, 2002-2005;

Partner, Squadron Ellenoff Plesent & Sheinfeld, 1997-2002, 1986-1995, and 1979-1984 and an associate 1977-1979;

Chief legal officer, Nomura Securities International, 1995-1997;

Director, Securities and Exchange Commission's New York City office, 1984-1986;

Deputy chief, Criminal Division, Southern District U.S. Attorney's Office, March through December 1976; and assistant U.S. attorney, 1971-February, 1976;

Trial attorney, SEC, 1968-1971

Charitable affiliations:

Member, board of governors, Hebrew University in Jerusalem; chairman of the board, American Friends of Hebrew University


J.D., George Washington University Law School, 1968

B.A., Tulane University, 1965


New York City (raised in Manhasset, Long Island)


Married to Ellen, two sons and two granddaughters. Resides in Roslyn, N.Y.
As sprawling as the Madoff case has become, Sorkin has other significant matters on his plate. He said he is representing 15 clients who are the subject of either SEC or criminal investigations. And he is preparing for trial in a matter before Southern District Judge P. Kevin Castel. The case, which involves an SEC civil enforcement proceeding, will test a new rule regulating the issuance of new securities to cover short positions.

Sorkin spent close to 11 years at the SEC and at the U.S. Attorney's Office in the Southern District. During his two years at the helm in New York, the SEC developed the so-called Yuppie Five case, which involved the prosecution of an associate who had been at Paul, Weiss, Rifkind, Wharton & Garrison.

"This points out that young professionals want to make it quickly, they're not willing to wait," Sorkin said to The New York Times in 1986. "They want the rewards sooner, and they don't want to make the effort. Greed knows no bounds. There's always someone who makes more than you do. Investment banking is the new gold mine."

The office's investigations also led to criminal prosecutions against E.F. Hutton & Co. and Kidder Peabody & Co., as well as a civil enforcement action against Robert Brennan, the head of First Jersey Securities.

Sorkin said he tried cases more frequently as a prosecutor than he has in his 28 years in private practice.

He recalled trying 15 cases in his first 11 months at the U.S. Attorney's Office. By contrast, he has tried six cases during his last eight years in private practice.

Discussing the decision on whether to go to trial, Sorkin quoted famed Ohio State football coach Woody Hayes, who explained his heavy reliance on a running game as stemming from the fact that two of three possible outcomes for passes -- an incompletion or an interception -- are detrimental.

Likewise, Sorkin said, with sentencing guidelines in effect, a plea is likely to result in less jail time than going to trial and getting convicted, but the choice is ultimately up to the client.


A wide-range of Sorkin's peers in the white-collar and securities bars described him as an outsized personality who is effective because he is so likeable.

Sorkin is "very gregarious and good natured," which serves him well in dealings with prosecutors and regulators as well as juries, said Robert G. Morvillo, of Morvillo Abramowitz Grand Iason & Silberberg.

But he also has "the residual toughness necessary in a criminal defense lawyer," added Morvillo.

"After two tours of duty at the SEC, one at the U.S. Attorney's Office in Manhattan, a stint as in-house counsel and years in private practice, Sorkin brings all different perspectives to the table," said David M. Brodsky, who has known Sorkin since the two worked together as Southern District prosecutors.

Brodsky, of Latham & Watkins, agreed that Sorkin has a "very large personality -- he doesn't just greet you with a handshake, but a hug."

John R. Wing, a partner at Lankler Siffert & Wohl, described Sorkin as "one of the busiest lawyers in town" who was one of the "two top lawyers in New York" that clients look to when they have SEC matters. Wing represents Madoff's brother, Peter, who has not been charged.

Among the cases Sorkin has tried in recent years was his defense of a former banker at Merrill Lynch & Co. accused of participating in an Enron related fraud. The 5th U.S. Circuit Court of Appeals in 2007 reversed the conviction of Sorkin's client as well as those of three co-defendants.

This past fall, Sorkin took a case to trial that was outside his usual repertoire. It involved an arms broker who was convicted in November of trying to sell millions of dollars in weaponry to revolutionaries in Colombia.

Sorkin declined to explain how he got the case other than to say "it came into the office."

The client, Monzer al-Kassar, was convicted but plans to appeal.

Sorkin said that some of his most important victories were cases in which he persuaded prosecutors or regulators not to press public charges. He declined to elaborate other than to say the cases involved "a number of high-ranking individuals in corporate America."

One of the cases Sorkin was able to resolve by negotiating a settlement with the SEC had a tie to Madoff.

The case involved an accountant, Frank Avellino, and his partner, who raised $441 million from 3,200 clients which they placed with Madoff on a promise that their clients would receive a return of between 13.5 percent and 20 percent a year, according to a New York Times report.

Sorkin negotiated a deal with the SEC that required Avellino to shut down his firm, return the funds to his investors and pay a $350,000 fine. Once the settlement was reached, the Times reported, the SEC inquiry "petered out."

Madoff was not sued by the SEC in that case.

For more coverage on the Madoff case, visit Law.com's Madoff Watch.

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Rodrigo González Fernández
Diplomado en RSE de la ONU
oficina: Renato Sánchez 3586 of. 10
Teléfono: OF .02-  8854223- CEL: 76850061
e-mail: rogofe47@mi.cl
Santiago- Chile
Soliciten nuestros cursos de capacitación  y consultoría en LIDERAZGO -  RESPONSABILIDAD SOCIAL EMPRESARIAL – LOBBY – BIOCOMBUSTIBLES  ,   y asesorías a nivel internacional y están disponibles  para OTEC Y OTIC en Chile

Bankruptcy Lawyers Cheer Mortgage Modification

Bankruptcy Lawyers Cheer Mortgage Modification

Bankruptcy lawyers who represent consumers like what they saw today in President Barack Obama's housing plan.

Their trade group, the National Association of Consumer Bankruptcy Attorneys, released a statement praising Obama's efforts to reduce the number of foreclosures, in particular his endorsement of legislation that would allow homeowners to request changes in their mortgages through federal bankruptcy proceedings.

"We agree with consumer advocates and others who say that Congress and the Administration should move with the same sense of urgency on curtailing this threat as they did with the economic recovery bill just signed into law," the statement says in part.

Allowing bankruptcy judges to modify the terms of mortgages, the statement continues, is "a solution that, unlike every other solution being considered in Washington, comes at absolutely no cost to U.S. taxpayers. This is one solution we know will work. The infrastructure already is in place. It is something the bankruptcy courts do every day with other assets."

The association says it has more than 3,500 members, at least some of whom could see additional work if Congress were to grant bankruptcy judges more authority. Sen. Dick Durbin (D-Ill.) and Rep. John Conyers (D-Mich.) have sponsored legislation to do so. The financial services industry is opposing the idea.

Rodrigo González Fernández
Diplomado en RSE de la ONU
oficina: Renato Sánchez 3586 of. 10
Teléfono: OF .02-  8854223- CEL: 76850061
e-mail: rogofe47@mi.cl
Santiago- Chile
Soliciten nuestros cursos de capacitación  y consultoría en LIDERAZGO -  RESPONSABILIDAD SOCIAL EMPRESARIAL – LOBBY – BIOCOMBUSTIBLES  ,   y asesorías a nivel internacional y están disponibles  para OTEC Y OTIC en Chile


Daily Biofuels News Digest
February 19, 2009
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OPXIn Colorado, Boulder, genomic search company OPX Biotechnologies is reported to have closed a $12.1 million series C financing round.

OPX is a licensee of technology from the University of Colorado that optimizes the process of selecting and modifying microbes used in the production of renewable fuels. The company said it aims to raise an additional $2.9 million for the expansion of staff and increase the pace of engineering activity.

The company is backed by Braemar Energy Ventures, Mohr Davidow Ventures and X/Seed Capital.

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Producer News

In Wisconsin, a receiver was appointed over the assets of Olsen's Mill after a subsidiary filed for bankruptcy, citing $100 million in debt. The Wisconsin Bureau of Business Trade Practices said that farmers who faced non-payment for contracted grain shipments could obtain relief from the  Producer Security Fund, funded by grain traders, which contains $9 million in reserve funds. 

In Maryland, New Generation Biofuels announced that construction of the company's 5 Mgy production facility in Baltimore that will support the company's 1.7 Mgy offtake agreement with Dynegy and a 220,000 gallon annual contract with the Commonwealth of Massachusetts and Taunton State Hospital. New Generation Biofuels is targeted to the off-road, stationery uses of biofuel, including hospitals and power plants.

In North Carolina, executives from Agrivida and Novozymes confirmed that the state, which is not a significant producer of corn, needed to focus on alternative crops and residues in order to meet a target of producing 10 percent of liquid fuels from local resources by 2017, as established in the state's biofuels roadmap.

Renew Energy
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Jason Pyle, CEO of Sapphire Energy: "The passage of the stimulus bill by the United States Congress and signing into law by President Obama proves this nation is on a new course to address our energy security needs, fight climate change and create jobs to improve the economy.   It's the right bill, at the right time, with the right priorities, and our nation's Congressional leaders and President Obama should be congratulated for their leadership."

From a joint statement by the Canadian Renewable Fuels Association and the Renewable Fuel Association (US): "The Canadian Parliament last year passed a Renewable Fuel Standard (RFS) requiring gasoline sold in Canada to contain an average of 5% renewable content, including ethanol, and 2% renewable content, including biodiesel, in the diesel supply...Together with production in Canada...North American biofuel production will be able to replace a majority of our oil imports."

International News

In Scotland, the Glenturret distillery in Crieff, Perthshire, home to Famous Grouse whisky, said that it would expand its carbon capture pilot project that utilizes 20 tons of CO2 produced by the plant as a feedstock for the production of Chlorella algae. The plant said that Chlorella does not have the highest oil content among algae strains, but consumes the copper residues and other chemicals produced in the fermentation stills.

In Germany, the national bioethanol association BDBe reported that German ethanol production increased 46 percent in 2008 to 458,394 tons, of which 61 percent came from grains. The association notes that sugar beets, which accounted for 8 percent of production volume in 2007, jumped to a 36 percent share in 2008, and allowed the production volume of ethanol to expand without increasing grain usage by ethanol producers.
In Denmark, the Energy Technology Development and Demonstration Programme awarded BioGasol a $13 million grant for a 1.2 Mgy cellulosic ethanol demonstration plant with a capacity of 5 million liters of ethanol per year. The EUDP previously awarded $5 million to BioGasol for the initial phase of the project.

Research News

In Germany, researchers at Goethe-University Frankfurt have developed a new process to convert xylose to ethanol by genetically modifying yeasts that previously would only convert glucose. The researchers discovered a new bacterial enzyme and inserted it into yeast cells. The research, which is published in Applied Environmental Microbiology, demonstrates that xylose can be converted in a single step.

Policy & Policymakers

WoodwasteIn "Pickin' On Pickens", Biofuels Digest correspondent Tim Sklar publishes a second part of his series on the development of biofuels and bioenergy from wood waste. The detailed article surveys US wastewood inventories as well as calculating the potential to produce 9.7 Bgy of ethanol at 441 midsize refineries, or 45 percent of the 2022 total mandate for second-generation biofuels.

Consumer & Fleet News

In New Jersey, Union County will commence a conversion to biofuels this week by employing B5 biodiesel in its 16 tractors, backhoes, lawn mowers, and an air compressor. The county has a total of 260 vehicles or pieces of equipment in total that run on diesel and could be converted to biodiesel in the future, according to county executives.
A Note to Readers

The producers of the Biofuels: Science and Innovation for Sustainable Development Conference to be held on June 28-30, 2009 in San Francisco, are offering Digest readers a $300 discount for the Conference and Workshop, which reduces the cost to $695-$995 depending on which track you select. (I will be presenting on advanced fuels and feedstocks during the workshop section of the conference).  The coupon can be obtained at biofuelsdigest.com.

In addition, this spring I will be presenting at several other conferences open to the public.
World Biofuels Markets (Brussels 03/09), 4th African Biofuels conference (Jo'burg, 04/09) , the Advanced Biofuels Development Summit (DC, 04/09), and Communicating Renewables 2009 (Minneapolis, 04/09). Presentation topics are detailed here.

If you plan on attending any of these fine conferences, let me know by email (jlane@biofuelsdigest.com) so we can schedule a coffee. I would like to learn more about your own activities and goals!

Regards, Jim Lane

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The Biofuels Digest Index™ (BDI), a basket of public biofuels stocks, dropped 1.54 percent to close at 49.33 on an ethanol plunge.  Archer Daniels Midland (ADM) gained 1.77 percent to $27.54, while British Petroleum (BP) lost 3.09 percent to $40.72.  Among small caps, Aventine Renewable Energy (AVR) fell 25.71 percent to $0.26. Overall, declines led advances 3 to 1 for the day. 
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These stories and more are available at BiofuelsDigest.com. Your comments and story requests are warmly welcome: email me at jlane@biofuelsdigest.com. Jim Lane, Editor, Biofuels Digest.

Rodrigo González Fernández
Diplomado en RSE de la ONU
oficina: Renato Sánchez 3586 of. 10
Teléfono: OF .02-  8854223- CEL: 76850061
e-mail: rogofe47@mi.cl
Santiago- Chile
Soliciten nuestros cursos de capacitación  y consultoría en LIDERAZGO -  RESPONSABILIDAD SOCIAL EMPRESARIAL – LOBBY – BIOCOMBUSTIBLES  ,   y asesorías a nivel internacional y están disponibles  para OTEC Y OTIC en Chile