Times Union: Documents, political ties uncloak Jacksonville's courtroom conflicts

[Patricia M. McBride]

The case of a judge, a bank, a lawsuit and some connections bring ethics into play.

Posted: January 2, 2011 - 12:00am

By Matt Dixon

For those who know it best, conflicts of interest in the Fourth Circuit Court are par for the course. The logic goes something like this:

"Sure, things happen in Jacksonville with judges. Many of them have been here a long time and served [as attorneys] with a lot of people," explained Robert George, a Jacksonville attorney who has been a member of the Florida Bar for 13 years.

"In Jacksonville, if you look hard enough, you can find a conflict in almost any case."

One involving George, Jacksonville's oldest bank, nearly $3 million in questioned property transfers, and former Fourth Circuit Judge Frederic Buttner, among others, underscores that point.

In the years leading up to Buttner's retirement in 2008, he presided over a civil case where a man said First Guaranty Bank helped his former business partner steal the building that housed a restaurant - Coyote's Oyster Bar and Grill - worth $1.6 million and a $1.1 million loan from a company the two owned together.

The business partner, Howard Shafer, was arrested after investigators with the Division of Insurance Fraud said they believed claims in plaintiff Robert Bigley's civil case were accurate. He faced charges of felony grand theft for transferring the property to a company he had 100 percent ownership in. They were later dropped.

Buttner's conflicts with the case, according to a Times-Union review, were not hard to find.

During his 2002 campaign, a longtime First Guaranty board member served as Buttner's campaign treasurer. That board member said he had known Buttner for years and that the judge also knew other board members.

Defense attorneys involved in the case also gave more than $4,000 to the campaign of Buttner's son in his unsuccessful campaign to replace his father in 2008. For some, it was their lone contribution to a political candidate.

In describing the situation, George, whose firm represents First Guaranty, used the example of a football coach who knows a referee off the field: "No one thinks the referee can't call the game objectively," he said.

Buttner said he did nothing wrong.

"If I know some members, it was on a professional basis. That's it," Buttner said.

Observers say that issues about judicial conflicts-of-interest are everywhere.

"Judges always get it wrong," said Bob Jarvis, a law professor at Nova Southeastern University in Fort Lauderdale. "They should recuse themselves much, much more, but none want to."

Doling out dollars

When Doug Milne served as campaign treasurer for Buttner in 2002, it was not the first time the two had met.

"I had known him for years," said Milne, who was a bank board member for nearly two decades ending in 2008. He said other bank board members also knew Buttner, but could not remember specifics.

It's not Buttner's lone potential conflict with the case.

While the civil proceedings were ongoing, bank officials and defense attorneys gave nearly $4,700 in contributions to Buttner's son, Rick, who was running for the seat being vacated by his father. For Hunter Malin, Shafer's civil attorney, the $500 maximum contribution to Rick is the only time he has ever given to a non-county-level candidate. He gave $100 to a Duval County judge in 2006.

In addition, First Guaranty handled the "banking services" for Rick's campaign. He was only the fifth political candidate the bank provided those services for, expenditure reports indicate.

An unsigned note with mysterious origins also indicates that Buttner and Donald Moran, the circuit's chief judge, had discussed getting Buttner back on the case without the knowledge of Bigley's attorneys. The note indicated court officials were talking to someone about strategies for getting the case moved from Judge John Skinner, the new judge, back to Buttner.

"Judge Buttner has talked to Judge Moran about this case and here is what he suggests," reads the note, which was attached to a motion filed by bank attorneys. "Set motion to reassign case to senior judge ... and once Judge Skinner grants the motion, contact Mary Lou [Moran's assistant] for Judge Moran to do an order appointing Judge Buttner to hear the case."

George said he did not know where the note came from.

Bigley's attorneys at the time, Bruce Committee and Michael Davie, said they had no idea the talks were ongoing.

"I was not involved in the particular discussion noted. Nor was I involved in any other such discussion at any other time to have a particular judge assigned to the case," Committee said.

Though attorneys for Shafer deny knowing anything about the note that was attached to the bank's motion, e-mails show they were involved with trying to get Buttner back on the case. "Hunter [Malin] said there is no update on getting retired Judge Buttner money yet," read a 2009 e-mail, which Shafer's criminal attorney, Shawn Arnold, sent to the state prosecutor handling the case. The reference was about efforts to get state funding so Buttner could come out of retirement and again oversee the case.

"We desperately want Buttner to get employed so that he can write the order," the e-mail continued.

Arnold said the e-mail was a concrete example of how frustrated he was because Bigley had delayed the civil case by filing for bankruptcy and changing attorneys.

Buttner said during a past hearing that his intention was to find in favor of Shafer and First Guaranty in the civil matter. Arnold felt a dismissal in civil court would boost Shafer's chances in the criminal case, thus his stated desperation to get Buttner back.

Though the legal system is absent a mechanism that allows a criminal attorney to get a judge back on a civil case, appearances hinted at Arnold's zeal.

Court documents show that Buttner's mention that he would find in favor of First Guaranty and Shafer caused state prosecutor Stephen Siegel, who declined to comment for this story, to drop the criminal charges.

"In August 2008 Judge Buttner was prepared to enter a summary judgment in favor of Shafer on this issue," he wrote. This "would have presented significant issues in the criminal prosecution."

Though state investigators also declined to be interviewed, in his final report, lead investigator Seth Schiefer was clear he thought the evidence showed that Shafer stole the building and loan were accurate.

"The defendant used the loan proceeds to pay the [restaurant's] existing mortgage ... and kept the remaining $359,100 for himself," the Feb. 2008 report read. "Contrary to regulations ... no distribution of any of the proceeds was made to" the company or Bigley.

A Septembr 2008 letter from Kenneth Kaiser, assistant director of the FBI's criminal investigative division, to U.S. Rep. Cliff Stearns, who Bigley asked for help, also seems to indicate that charges against First Guarantee employees were looming.

"Recent contact with the [state attorney] determined no charges would be brought against any bank employee in connection with the Bigley's loan until the civil trial was complete," the letter read.

Because Siegel dropped the charges prior to the civil trial concluding, that scenario never played out.

Closing arguments

Shafer said he made the transfer because his relationship with Bigley soured.

"Bob and I started not getting along. He started telling people the business was his," Shafer said. "The relationship was totally just deteriorating. That's when I transferred the property."

He said it was legal because he owned 60 percent of the company, to Bigley's 40 percent, and had put up more than $500,000 in seed money.

Buttner was ultimately unable to find in favor of the defendants because Bigley filed for bankruptcy, again halting the process. The case would later be dismissed by Skinner, two years after Siegel dropped the criminal charges.

Jarvis, the law professor, questioned the ethics of the note attached to the bank's motion.

"This does seem troubling," said Jarvis, who reviewed the communications. "Where were the Bigleys' attorneys in all of this? They should have known."

He said that communication of this type is a violation of the Judicial Code of Ethics, which states, in part, that a judge should not communicate with one party without the knowledge of the other.

Situations like this, he said, happen because judges are hesitant to recuse themselves.

"It's almost an admission that they have the same biases that other people have."

After his case was dismissed, Bigley and his wife, Cyndi, filed a complaint in federal court laying out a complex conspiracy involving Buttner, the bank, and Shafer's attorney, along with roughly 20 others.

"First Guaranty Bank and Trust company of Jacksonville, has taken control over the state court system in at least Clay County," read the 82-page complaint filed in the Federal case.

U.S. District Judge Timothy Corrigan called the claims "fantastical" and tossed the suit during an August hearing. The Bigleys are trying to appeal.

T-U reporter Paul Pinkham contributed to this report

 

http://jacksonville.com/news/metro/2011-01-02/story/documents-polit...

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