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Hack Snared Judge’s Husband, Defense Says

MANHATTAN (CN) - New York's chief federal judge should be disqualified from hearing hacking charges because her husband's information was exposed in the defendant's alleged cyberattack, lawyers say.

Jeremy Hammond was one of five so-called hacktivists arrested in a March sting operation that took place after the FBI made an informant out of Hector Monsegur, a hacker known online as Sabu, who led a group called LulzSec.

Agents picked up Hammond his home in Chicago, but the other defendants - Ryan Ackroyd, Jake Davis, Darren Martyn and Donncha O'Cearrbhail - were arrested in the United Kingdom and Ireland.

Among various alleged exploits, prosecutors say the quintet is responsible for cracking into the internal communications of Strategic Forecasting, or Stratfor, which has been characterized as a spy agency for the private sector.

The cyberattack exposed the private information of 860,000 Stratfor clients, as well as 5 million emails, which WikiLeaks published under the name Global Intelligence Files.

Chief U.S. District Judge Loretta Preska is presiding over Hammond's case in Manhattan. In a new motion challenging Preska's impartiality to hear the charges, Hammond's lawyer says that the Stratfor hack exposed details about Thomas Kavaler, Preska's husband.

Kavaler is a partner at the law firm Cahill Gordon & Reindell LLP for more than three decades, and Preska used to be a partner there before entering the judiciary.

"Major clients of Cahill Gordon, including Merrill Lynch and AIG, were also victims of the Stratfor hack," according to the motion authored by Hammond's Brooklyn-based attorney Elizabeth Fink.

"Merrill Lynch appears to have been particularly impacted by the hack; over 800 accounts associated with Merrill Lynch email addresses were compromised," Fink added. "Cahill Gordon has overseen hundreds of millions of dollars in investment banking arrangements for Merrill Lynch."

More than 20 Cahill Gordon clients were victims of the hack, the motion alleges.

The exposed clients went on to win an estimated $1.75 settlement from Stratfor, according to the motion.

"The issue here is two-fold; first, this court's spouse is a victim of the alleged crimes of the defendant," Fink wrote. "This personal connection to the damage allegedly inflicted by Mr. Hammond is more than enough to raise the possibility in the mind of an objective observer that this court could not be impartial in this case. Second, the court's spouse has an attorney-client relationship with other prominent victims of the Stratfor hack, and his firm derives a percentage of its profits from its representation of these victims. As one of Cahill Gordon's senior partners and top litigators, Mr. Kavaler enjoys a substantial stake in the profits of the firm."

Prosecutors have not yet filed their reply motion, which will likely defend the judge's impartiality.

Fink argues that even the perception of the judge's bias could compromise the case.

"As this trial continues, and the victimization of this court's spouse, and his connection to other victims, becomes more widely known, this perception of partiality will only further undermine confidence in the courts," the motion states.

Judge Preska has scheduled arguments on the matter for Jan. 11, 2013.

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