NY Watchdog Sued for Inaction on Shel Silver

ALBANY, N.Y. (CN) - The prosecution of former state Assembly Speaker Sheldon Silver does not satisfy the need for a state probe into his alleged corruption, another politician claims in court.

Before Silver resigned from the Assembly speaker position earlier this month, on the heels of his arrest for corruption charges, there was reason for New York to investigate him for ethics violations, the complaint filed in Albany County Supreme Court states.

Maureen Koetz, a Republican who lost to Silver by a wide margin in November, says the state's Joint Commission on Public Ethics (JCOPE) has been sitting on a complant she filed with the agency two months before the election.

Koetz asked JCOPE to investigate "potential ethical violations" by Silver in three areas: his outside income from a high-profile personal injury law firm; his dealings with a former assemblyman disgraced by sexual harassment charges; and his relationship with the fired leader of a Jewish charity who pleaded guilty to stealing from the group.

Taken together, these issues "raise questions about an ongoing pattern of violations of ethical rules," Koetz says.

Koetz's Feb. 3 lawsuit echoes these concerns, asking for the court to either answer whether Silver violated state public officers' law or to direct JCOPE to make the determination.

Though the court did not make Koetz's lawsuit immediately public, she filed it on the same day a new leader was named in the Assembly. Though Silver relinquished the powerful speaker's post that he held for 21 years, he stays on as an assemblyman representing Lower Manhattan.

Prosecutors accuse Silver of collecting millions in kickbacks from two law firms, taking money for using his role as speaker to help the real estate clients of one firm and yielding new asbestos-injury claimants for another.

Koetz's lawsuit asks that Silver be disqualified from serving as speaker if the court or JCOPE determines that he violated public officers' law.

Silver's resignation as speaker would have no effect on the lawsuit, Koetz's attorney, William DeCandido of Forest Hills, said Wednesday.

"Regardless of recent events, we contend that it remains vital for the court to compel JCOPE to take action on these important ethical issues," DeCandido said in an email.

"The court should rule on the case as pled to prevent future conflicts of interest and to clarify the ethical limits and requirements placed on any Speaker under the law."

Both Koetz's lawsuit and JCOPE complaint say that Silver's outside income as a lawyer warrant review in light of the money received from Weitz & Luxenberg and Counsel Financial.

Weitz, a Manhattan personal-injury law firm, focuses on mesothelioma and asbestos exposure, defective drugs and medical malpractice. Koetz identifies Counsel Financial as a firm that lends money to plaintiff's attorneys that appears to be owned by the founders of Weitz & Luxenberg.

Weitz also figures into the federal charges leveled against Silver, who announced a leave of absence from the firm soon after his arrest. He had been of-counsel there for a decade.

According to Koetz's lawsuit, public officers' law "prohibits a state elected official from possessing interests or engaging in activities that are in conflict with the proper discharge of his duties in the public interest."

Silver disclosed "substantial compensation" from Weitz in annual financial statements he filed with the state in 2012 and 2013, Koetz says.

"Accepting large sums of money from a plaintiff's mass tort firm and an entity lending money to (and supporting) the plaintiff's bar is a conflict of interest of Assemblyman Silver's duties as speaker of the Assembly and violated public officers law ... on its face," she contends (parentheses in original).

If the court will not decide the matter, "then JCOPE must be compelled to deal with the conflict-of-interest issue immediately as it is directly related to its mission; to delay this decision denies the public's right to an ethical Legislature," Koetz says.

The Legislature created JCOPE in 2011 as an independent agency to oversee compliance by the executive and legislative branches with New York's ethics and lobbying laws. It preaches transparency, but critics say confidentiality laws nullify its efficacy since the investigations are kept quiet unless legal violations are found.

Koetz asks that she be formally notified of any decision that JCOPE makes on Silver's conduct. She contends the agency ignored the complaint - with copious attachments - that she filed in September.

One target of the complaint and the lawsuit is the alleged misconduct by Silver and other elected officials in dealings with former Assemblyman Vito Lopez and William Rapfogel, former chief executive of the Metropolitan Council on Jewish Poverty.

Lopez, a Brooklyn Democrat, resigned in 2013 after female staffers accused him of sexual harassment. Silver helped negotiate a secret settlement in 2012 with two staffers who paid them $103,000 and bypassed formal referral of the complaints to JCOPE, Koetz says.

The harassment continued, though, and two other women sued Lopez and Silver in state and federal courts. They settled last week for $545,000, press reports show.

Koetz contends Silver acted to protect Lopez because he was chairman of the Assembly housing committee and could deliver legislation beneficial to real estate developers, who then would be happy to contribute to election campaigns.

Koetz claims Silver was cozy with Rapfogel, too, channeling public money to the Met Council. Rapfogel's wife, Judy, served as Silver's chief of staff.

Rapfogel pleaded guilty last year to state charges of scheming with others to inflate the charity's insurance payments and pocket the difference. Some of the money wound up in the campaign coffers of politicians friendly to the charity, according to the attorney general's office.

Koetz, a lawyer who owns a consulting firm, challenged Silver in November for the Lower Manhattan Assembly seat he has held for nearly 40 years.

He easily won with 76 percent of the votes cast in the district.

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