City Of New York v. Citisource, Inc

679 F. Supp. 393 (S.D.N.Y. 1988)

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Nature of the Case

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Facts

P sought treble damages under the Racketeer Influenced and Corrupt Organizations Act ('RICO'), 18 U.S.C. § 1962(c) & (d) (1982), for injury sustained as a result of defendants' bribery of Geoffrey Lindenauer, the former Deputy Director of the City's Parking Violations Bureau ('PVB'), and Donald Manes, the former Queens Borough President. The bribes related to the award of a $22.7 million municipal contract to CitiSource, Inc.(D). Friedman and Kaplan were found guilty of criminal charges of racketeering, RICO conspiracy, and mail fraud in connection with the award of the D contract. The jury found that defendants Friedman and Kaplan, unlawfully, willfully and knowingly conducted and participated in the conduct of the affairs of the PVB through a pattern of racketeering activity, as that term is defined by sections 1961(1) and 1961(5) of RICO, by bribing Manes and Lindenauer with shares of D stock which were held for them by defendant Friedman. On about March 27, 1986, the Manhattan District Attorney filed an indictment against defendants Friedman and Kaplan and other D principals based on the fraudulent procurement of the D contract and the subsequent public offering of D stock. The District Attorney also obtained orders of attachment in a related state civil forfeiture action against the assets which are at issue in this case. The attachment orders were based on the same circumstances which gave rise to the state indictment. On December 17, 1987, the New York Court of Appeals barred the District Attorney from proceeding with the criminal prosecution of Friedman and Kaplan under the state indictment, on the ground that the state prosecution violated the double jeopardy clause of the State and Federal Constitutions. Matter of Marvin B. Kaplan, 71 N.Y.2d 222, 519 N.E.2d 802, 525 N.Y.S.2d 1 (1987). The state court has since vacated the attachment in the civil forfeiture action. There is strong evidence that Ds are attempting to hide their assets. P now moves for reargument pursuant to Rule 3(j) of the Civil Rules of this Court. In its original motion, the City had relied exclusively on CPLR § 6201(4). Now, in addition to arguing that the Court erred in its interpretation of § 6201(4), the City asserts that it is entitled to an attachment pursuant to CPLR § 6201(3).