Alito: Were Those Really Questions….?

By January 15, 2006Judicial Nominations

OK, so the latest estimate is that Judge Alito took some 677 questions from Senators during about 18 hours of hearings. However, according to an ABC News report, Sen. Biden (D-DE) spoke for 24 minutes on Tuesday, leaving only 6 for Judge Alito. On Wednesday he spoke for about 13 minutes, as compared to 6 for Alito and on Thursday went for about 13 and a half minutes, with Alito spending about half that amount on answers.

Sen. Schumer (D-NY) took almost 23 minutes for himself on Tuesday, leaving only about 7 minutes for the good judge. On Wednesday, he talked for over 15 minutes, leaving only about 5 for Alito and finally on Thursday, bloviated for almost 20 minutes, leaving 10 minutes for Judge Alito.

Doesn’t really sound like an attempt to get at the truth or the facts, does it? Sounds more like a lot of hot air, a lot of speechifying by folks not that interested in the Judge’s views after all.

Click here to write to your Senators and tell them to support Judge Alito and to put his nomination to a quick up-or-down vote.

Join the discussion One Comment

  • M.Costello says:

    A Widow?s Stand for Justice

    During the recent Judiciary Committee hearings, we heard lavish praise of Judge Samuel Alito. Supporters who have experienced professional and personal relationships with Judge Alito have weighed in with equal measures of recommendation and high regard. But hearings of the Senate Judiciary Committee are not supposed to be love-ins; they are supposed to be the forum where judicial nominees fully answer the questions posed and explain their past actions to the Senate and the public.

    On January 11, Senator Specter stated:? And I share Senator Kennedy?s concern that we have all the facts, all the facts, all the facts. And this is a lifetime appointment, it?s a matter of tremendous importance, and I wouldn’t want to find on some occasion that something comes to light which would bear on this nomination that we could have found out had we had been more vigilant.?

    Senator Specter is correct. The facts of Judge Alito?s conduct in the Monga/Vanguard appeal deserve to be closely examined by the Senate Judiciary Committee before Judge Alito is recommend to such an important office as Associate Justice of the Supreme Court of the United States. The fact that Judge Alito gave ?responses? and not ?answers? has been well noted in the press. The fact that Judge Alito gave varied and conflicting answers regarding his participation in the Monga/Vanguard case has been likewise noted. The fact that Judge Alito, gave false information under oath to the Senate has not.

    When Judge Alito?s actions or inactions were revealed by the media upon his nomination, Judge Alito, as well as the damage control experts at the White House started issuing various explanations. None of them, including those he gave to the American Bar Association and the Judiciary Committee are credible. With more than half a million dollars of his money in Vanguard investments, Judge Alito clearly knew that he had financial conflicts of interest in Monga/Vanguard appeal. Yet, he spent two months repeatedly misrepresenting the facts concerning his misconduct in that case.

    The Monga appeal was brought in the Third Circuit by his widow, Shantee Maharaj. Monga, a petroleum engineer and a member of the Massachusetts Bar, had established two very successful environmental consulting companies. In 1989, a former business associate sued Monga and obtained a judgment against him and the companies. Before Monga could appeal the judgment, the business associate sought the appointment of a receiver, John Ottenberg, to seize Monga?s assets. Without any notice to Monga, Ottenberg convinced a Massachusetts judge to turn over to Ottenberg, an IRA which Monga had invested with Vanguard. The IRA was not an issue in the lawsuit. Upon Ottenberg?s request, and without any valid court order, Vanguard unlawfully seized Monga?s IRA in June 1992 and kept it frozen for six years ? even while Monga was dying from cancer. Ottenberg simply asserted that the amount in Monga?s IRAs ?… seemed high for someone his age ….? Again, without being provided any notice, Monga learned of the freeze only after telephoning Vanguard to check the IRA balance.

    Internal Revenue Service regulations and Vanguard?s IRA Contract provide for the early distribution of IRAs assets upon disability. Within a few months after the cancer had been detected, Monga had incurred major medical expenses. Vanguard was apprised of Monga?s disability and poor financial condition. Monga knew that, as allowed by law, his IRAs would be available in such circumstances for support and thus, demanded his IRA assets. Vanguard refused. Monga died of cancer in 1996 at the age of 56 without the use of his IRAs when he most needed these savings. Realizing it had made a serious legal blunder, Vanguard lied in Court, stating that it had complied with an order from another court in freezing the IRA. No such order existed, and no such order exists.

    IRS regulations (Publication 590) provide that a widow may adopt the IRA of her deceased husband as her own. IRAs are among the single largest assets left to widows. A widow can elect to receive the entire balance immediately or rollover it over as her own. As the surviving spouse and sole beneficiary, Maharaj requested a lump sum distribution of the amount in her deceased husband?s IRA. Vanguard again refused to comply with its own IRA Contract, as well as clear federal and state laws.

    Adding insult to injury, after Monga?s death, Vanguard, a Pennsylvania Company, asked a Massachusetts State court to keep for itself $92,000 of Maharaj?s IRA which funds Vanguard used to oppose the widow – its own customer. Vanguard gave the balance of Maharaj?s IRA to Ottenberg, allegedly to satisfy a judgment against her deceased husband. This was done despite explicit laws and Vanguard?s own IRA Contract precisely protecting against the unlawful tactics Ottenberg used to seize the widow?s inherited retirement savings. Ottenberg shared his loot with Attorney Peter Brooks ? the lawyer who obtained Ottenberg?s appointment. The bottom line is that Maharaj lost all the retirement savings her late husband had entrusted to Vanguard. In clear violation of U.S. Supreme Court?s precedent, Vanguard then asked the Massachusetts court to block the widow from suing it. This was done after a Pennsylvania Federal Judge had warned Vanguard that it would be liable to Monga should Vanguard turn over Monga?s IRA to the Massachusetts receiver.

    The appeal which was before Judge Alito in 2002 resulted from Monga?s 1995 lawsuit seeking damages against three Vanguard companies, The Vanguard Group, Inc., Vanguard Fiduciary Trust Company, and Vanguard/Morgan Growth Fund, Inc., for, among other claims, breach of contract, breach of fiduciary duty, and conversion. Monga?s Federal Complaint charged that Vanguard unlawfully seized his IRA in violation of Federal and Pennsylvania laws, as well as terms of Vanguard?s IRA Contract.

    Federal and State law, and U.S. Supreme Court precedent, provide that a bona fide IRA cannot be used to pay a judgment creditor. The federal law provides that IRAs are ?for the exclusive benefit of an individual or his beneficiaries? and are ?nonforfeitable.? The recent Supreme Court decision in Rousey v. Jacoway, reaffirmed that IRAs are protected. Parallel State laws and Vanguard?s IRA Contract say the same thing. Vanguard?s IRA Contract provides that the IRA is established for the exclusive benefit of the accountholder or his beneficiary; and the IRA account holder?s interest in the IRA shall be non-forfeitable at all times. When it comes to lawsuits such as this one, the Vanguard IRA Contract parallels the law and flatly states that Vanguard IRAs cannot be seized to satisfy a judgment. In ruling in favor of Vanguard, Judge Alito came to conclusions totally at variance with Federal law, State law, decisions of six other federal Circuit Courts of Appeals, precedent of the United States Supreme Court, and the terms of Vanguard?s IRA Contract.

    The Senate Committee did not examine Judge Alito?s departure from law and precedent in this case, choosing to focus on the recusal issue. But here too, Judge Alito provided false and erroneous information in attempting to explain his failure to recuse himself from this appeal. The hearing transcripts show that on January 10 and many times thereafter, Judge Alito falsely repeated under oath to the Senate Judiciary Committee that he recused himself from this case. For Judge Alito to testify that he recused himself over a year after he decided the case in favor of a company in which he had invested hundreds of thousands of dollars seriously misrepresents his actions at the time. Judge Alito could not have recused himself after he actually participated and decided this appeal. The record is clear, Judge Alito never recused himself. Indeed, he wrote the Opinion which made Vanguard, a company in which he has financial and ownership interests, the winner.

    The transcripts of the hearings during the testimony of the American Bar Association, as well as the ABA?s January 9, 2006 letter to the Committee further show that Judge Alito similarly misrepresented his conduct to the ABA concerning his actions in the Monga/Vanguard appeal. Because the ABA?s evaluation of Judge Alito?s integrity was based on his material misrepresentations, its endorsement is unreliable and must be ignored.

    The transcript of the hearings also shows that Judge Alito failed to correct Senator Mike DeWine?s misrepresentations concerning the claims for damages against Vanguard in the Monga/Vanguard lawsuit. Judge Alito, by his tacit conduct, allowed the Judiciary Committee to assume that Senator DeWine?s erroneous statements are true.

    Judge Alito, under oath, also told the Senate Judiciary Committee that he is the type of judge ?to go beyond the letter of the ethics rules and to avoid any situation where there might be an ethical question raised? and that Ms. Maharaj received a ?new hearing before a new and different panel.? These are serious misrepresentations. Even when Ms. Maharaj was later represented pro bono by Professor John Flym in this appeal, she received no consideration whatsoever. There was no hearing, and her lawyer?s efforts to represent her were hindered at every step by the new Third Circuit panel which included one of Judge Alito supporters, Judge Scirica.

    Ms. Maharaj never received the fresh appeal to which she was entitled. The new panel, simply reissued, save for one brief footnote, a verbatim copy of the original opinion. Pursuant to the U.S. Supreme Court decision in Liljeberg v. Health Services Acquisition Corp., Ms. Maharaj was entitled to a new, impartial panel to take a fresh look at the appeal. This never occurred. Instead, the second panel adopted an irregular mode of proceeding: it continued to treat Maharaj as a pro se litigant by failing to recognize Professor Flym who was then Ms. Maharaj?s counsel of record. It failed to provide the required notice to Professor Flym, and refused to provide any opportunity to be heard through her counsel. The Court failed to enter her lawyer?s pleadings on the docket, and simply rubberstamped the same opinion authored by Judge Alito when he had absolutely no legal authority to act in this appeal ? an opinion which was void.

    Perhaps Judge Alito thought a powerless widow, acting without a lawyer, would simply shut up and go away. But Ms. Maharaj did not. When she exposed his conflict of financial interests, Judge Alito ran for cover, issuing excuses one after the other in the hope that one of them would sound convincing. His colleagues on the Third Circuit closed ranks, just as they did last week in the Committee hearings. Without any hearing on the merits, the Third Circuit gave the impression that they had set aside Alito?s tainted ruling. The impression was carefully conveyed that Monga?s pleadings were being reviewed, and that the wrong that Judge Alito had done was being rectified. The Third Circuit needed to make it appear as though Monga was receiving a fair hearing, his day in court. They then issued a ?new? ruling, which aside from a footnote, is identical to Judge Alito?s void ruling. These judges ruled without a hearing on the merits, just as Judge Alito had done in crafting his tainted ruling. In fact, no court ever has granted Monga or his widow a hearing on the merits in this case.

    Among Judge Alito?s Third Circuit colleagues testifying at the January 12 hearing, was former Chief Judge Edward Becker. In 1999, CNN reported that Judge Becker had decided two Third Circuit cases involving Hercules, Inc, while Judge Becker held stock in Hercules; clearly financial conflicts of interest. Once caught by CNN, Judge Becker admitted these conflicts of interest, and like Judge Alito in one of his excuses, blamed the ?computer.? Judge Becker stated that the Third Circuit now has an automated computer-matching program to identify cases in which a judge should disqualify himself. In commenting on his $10,000.00 worth of stock in Hercules, Inc. while presiding in the two cases where Hercules was a party, Judge Becker explained: ?Had we had then what we have now, [the automated computer-matching program] this couldn?t have happened.? Besides serious ethical and credibility questions associated with Judge Becker?s testimony at the hearings in support of Judge Alito?s confirmation, this raises important questions as to whether the federal recusal statute as enacted by Congress is enforced in the Third Circuit.

    When Judge Alito was pinned down on his conflict of interest by Senator Kennedy on January 12, he finally admitted that his participation ?in a 2002 Vanguard case was an oversight?, while simultaneously stating that he ?didn?t do anything wrong.? The dictionary definition of ?oversight? includes: error, mistake, omission, fault, failure to appreciate, failure to notice, misrepresentation, and misunderstanding. By any of these definitions, Judge Alito?s testimony that he ?didn?t do anything wrong? lacks credibility. If the glowing testimony of his friends and colleagues, and his outstanding memory of the smallest of detail in all of his dissenting opinions are to be relied upon, we must ask how someone who is so careful, bright and attentive to responsibility could be so uncharacteristically careless? If one is sincere in the exploration of this dichotomy, one must concede that something just doesn?t add up. One thing is apparent, however: Judge Alito?s nomination should have been withdrawn months ago when this serious conflict of interest surfaced. Even after Judge Alito?s recent admission, some Senators and colleagues supporting him continue to ignore Federal recusal law and ethics rules, claiming that Judge Alito was not required to recuse himself.

    Judge Alito should never have participated in the Monga/Vanguard appeal. He knew of his investments worth from $390,000.00 to $975,000.00 in Vanguard, and of his ownership interests in The Vanguard Group, Inc. a party Defendant in the case. Thus, he knew that his participation in this appeal involving Vanguard was illegal. This is confirmed by his admission ?If I had to do it over again, there are things that I would have done differently.? His 1990 promise to the Senate to recuse himself from any case involving Vanguard amounts to his recognition and understanding that the judges? recusal statute would require him to do so. The judge?s explanation regarding his promise being time limited is not only disingenuous, but undermines the fidelity to right action which any member of the judiciary is expected to uphold throughout his service. This recognition is also consistent with the warning of the Judicial Conference of the United States that the recusal statute applies to federal judges who own shares in certain mutual funds which convey an ownership interest in the mutual fund management company. Judges are required to disqualify themselves from a case no matter ?however small? his financial interest is in a party to the case. Indeed, Judge Alito admits he now has Vanguard companies on his ?standing recusal list.?

    But does any of this matter? After all, Senator Specter asked a carefully selected number of legal ethics experts and personal friends of Judge Alito to comment on the conflict. Not surprisingly, they said Judge Alito did nothing wrong. Yet, even among these selected experts, the verdict is not the ringing endorsement one might expect. For example, on his legal ethics website, Professor David McGowan states ?it is not clear why Judge Alito heard this case in the first instance.? Professor McGowan continued ?If an ownership interest in a Vanguard fund entails an ownership interest in Vanguard the management company, then Judge Alito would be in violation of the financial conflict of interest rule, because the basic prohibition of the recusal statute runs to ownership interests, ?however small.?? This is the opinion of one of the experts upon whom Judge Alito supporters rely. Another, Prof. Geoffrey Hazard, a self described friend of Judge Alito, admits that Judge Alito made a ?mistake? in failing to recuse himself. Notably, all of the legal experts who support Judge Alito offered their opinions based on erroneous assumptions and misrepresentations. Professor Daniel McGowan, who co-authored an Op-ed piece in The Baltimore Sun with Steven Lubet has acknowledged on his legal ethics website that he based his findings in support of Judge Alito?s position on erroneous and incomplete information. Because the opinion letters/news articles of Professors Rotunda, Hazard, Morgan, Lubet and McGowan in the Committee?s record are similarly based on factual errors and material misrepresentations, all of these opinions are unreliable and must be ignored.

    Other ethics experts, whose views were neither solicited nor heard during the Committee hearings state that Judge Alito was required by law to recuse himself from participating in the Vanguard case. These experts include Richard E. Flamm, Esq. (author of a national treatise on the subject of Judicial Disqualification: Recusal and Disqualification of Judges — a book which has been relied on by many U.S. courts in deciding recusal questions); Professor Stephen Gillers, New York University School of Law; Mary Cheh George Washington University Professor of Constitutional Law; Professor Deborah Rhode (Director, Stanford University Center on Ethics); and Doug Kendall, Executive Director of the Community Rights Counsel. Additionally Ms. Maharaj?s lawyer, Professor John G. S. Flym of Northeastern University School of Law, Boston, a professional responsibility expert, testified at the hearing on January 13 that Judge Alito was obligated under the law to recuse himself in the Monga/Vanguard appeal.

    There is another major issue that was not given the attention it deserves in the Alito hearings. Federal law, State law, and Supreme Court precedent protect IRAs for the exclusive use of individuals and their beneficiaries. This issue is of national significance potentially affecting an estimated 44.3 million American households holding $2.41 trillion in IRAs, mostly invested in mutual funds. (See, The Investment Company Institute?s website 2003 posting at http://www.ici.org.) Forty-five States either have exemption statutes incorporating Federal law protecting IRAs, or courts in those States have interpreted statutes to exclude IRAs from creditors? claims. Under Judge Alito?s ruling, anyone could experience Monga?s fate – anyone with the misfortune of having their assets placed under receivership based on unproven allegations of fraud could have their retirement savings taken away from them. Individuals who have relied on Federal and State laws protecting their IRAs against creditors? claims should be dismayed to discover that IRA Trustees such as Vanguard permit their IRAs to be seized by unscrupulous Receivers.

    Judge Alito?s ruling in favor of Vanguard endorses violations of Federal law and State statutes, and opens the door for abuses in debt collection through strategic manipulation of the law. Under Judge Alito?s reasoning in the Monga/Vanguard appeal, statutorily protected IRAs are ready targets for overreaching debt collectors. As here, a creditor could seize IRAs simply by alleging fraudulent conveyance. Judge Alito?s decision in this appeal protecting Vanguard also invites IRA Trustees to explore ways to evade their IRA Contracts. Any out-of-state request to attach IRAs may be used as a subterfuge by IRA Trustees to justify depriving account holders of their exempt property at the behest of an out-of-state stranger. A subsequent order could then be obtained by stating that the out-of-state court ordered the turnover of the IRA. Few IRA account holders have the resources to litigate against large corporations such as Vanguard. Judge Alito?s opinion in this case gives an unfair advantage to those who can strategically manipulate the law to seize protected retirement assets. Clearly, members of the United States Senate deserve a greater understanding of their stake in the appeal of this case – and why it was illegal for Judge Alito to choose to ignore his duty to obey the federal recusal statute, U.S. Supreme Court precedent, the Code of Judicial Conduct, and ethics rules. His outrageous conduct throughout this appeal and his false statements under oath to the Senate provide grounds to reject his nomination as a justice to the United States Supreme Court.