IN THE SUPREME COURT OF FLORIDA
THE FLORIDA BAR,
Complainant/Appellee, Supreme Court Case # SC00-256
Honorable Jacqueline Hogan Scola, v. Florida Bar File # 1998-71, 455(11B) ALAN I. KARTEN,
Respondent/Appellant / __________________________________________________________________
ON PETITION FOR REVIEW OF THE AMENDED REPORT OF THE SUCCESSOR REFEREE DENYING RESPONDENT/APPELLANT AN
EVIDENTIARY HEARING ON HIS MOTION FOR NEW TRIAL
INITIAL BRIEF OF THE APPELLANT
____________________________________ ALAN IRA KARTEN, pro se 1888 N.W. 7th Street Miami, Florida 33125 Tel: (305) 541-6300 Fax: (305) 643-3334
TABLE OF CONTENTS Page
TABLE OF CONTENTS …………………………….………………………… i TABLE OF AUTHORITIES ……………………………………….………….. ii STATEMENT OF THE ISSUES………………………………………………...1 STATE OF THE CASE AND RELEVANT FACTS……………………………1 STANDARD OF REVIEW …………………………………………………….10 SUMMARY OF THE ARGUMENT ………………………………………..…10 ARGUMENT ………………………………………………….………………..12
I. THE SUCCESSOR REFEREE INCORRECTLY RULED THAT THE EVIDENCE PRESENTED IN KARTEN’S MOTION TO SUPPLEMENT THE RECORD AND FOR REHEARING (FEBRUARY 8, 2001) AND HIS MOTIONS TO RELINQUISH JURISDICTION IN ORDER TO PURSUE NEWLY DISCOVERED EVIDENCE FILED DURING HIS APPEAL WERE PRECLUDED FROM CONSIDERATION.
II. THE SUCCESSOR REFEREE, IN A NON-JURY PROCEEDING, FAILED TO FOLLOW THE CORRECT PROCEDURE FOR REVIEWING A MOTION FOR NEW TRIAL FILED PURSUANT TO FLORIDA RULE OF CIVIL PROCEDURE 1.540. III. ASSUMING THAT A NEW TRIAL IS NOT MANDATED THE SUCCESSOR REFEREE IS REQUIRED TO HOLD AN EVIDENTIARY HEARING.
CONCLUSION……………………………………………………………..…49 CERTIFICATE OF SERVICE………………………………………………..50 CERTIFICATE OF COMPLIANCE………………………………………….50
i
Table of Authorities
Cases Page Anderson v. City of Bessemer City NC, 470 U.S. 564 (1985)……………………………….……………….16 Anderson v. Dewey, 350 P.2d 734(Idaho 1960)................................................…..............17 Austin v. United States, 113 S.Ct. 2801 (1993) …..………………………..……….…………4 Canseco v. USA, 97 F.2d 1224 (9th Cir. 1996)…………….……...……………….….15 Corporation v. Siraco, 174 F.2d 360 (2nd Cir 1949)…………………………………………16 Davenport v. Dimitrijevic, 857 So.2d 957 (4th DCA 2003)….…………………………………..39 David E. Lever v. United States of America, 443 F.2d 350 (2nd Cir 1971)………………..……………………….15 Dynasty Express Corp. v. Weiss, 675 So.2d 235 (4th DCA 1996)….………..………………….…20, 39 The Florida Bar v. Alan Ira Karten, 829 So.2d 883 (Fla. 2002)……………………………………………4 The Florida Bar v. Clement, 662 So.2d 690 (Fla. 1995)…………….……………………………..10 The Florida Bar v. Weiss, 586 So.2d 1051 (Fla. 1991)………………………………………….10
ii
Federal Deposit Ins. Corporation v. Siraco, 174 F.2d 360 (2nd Cir. 1949)…………..……………………………20 Florida Department of Transportation v. Juliano, 801 So.2d 101 (Fla. 2001)…………..………………………………13 Grudzina v. New Mexico Youth Diagnostic and Development Center, 725 P. 2d 255 (N.M. App 1986).….…………………………………21 Herwitt v. Caffee, 368 So.2d 1342 (3d DCA, 1979)…...………………………………..23 Island Transp v. Ilman, 669 So.2d 298 (3rd DCA 1996)……...………………...…………….48 Kline v. Belko, LTD, 480 So.2d 126 (3rd DCA 1985)………………………………………42 Karten v. Karten, Case # 99-000210 (Cir. Ct. 17th Jud. Circuit1999)........................36, 38 Lashbrook v. Kennedy Motor Lines, Inc., 119 F. Supp. 716 (W.D. Pa. 1954)…………………………………..18 Loynaz v. Karten,
Case # 02-6097 CA 21 (Cir. Ct. 11th Jud. Circuit 2002).7, 28, 32, 34, 45 Marshall v. Jerrico, Inc., 446 U.S. 238, 242 (1980).....................................................................19 McBride v. State, 801 So.2d 1019 (5th DCA 2002)….……………………………….…14 McDonald v. Pickens, M.D., 544 So.2d 261 (1st DCA 1989).…..…………………………………..42 National Health Care v. Cascio, 725 So.2d 1190 (2nd DCA 1998)..……………………………………17
Reaves v. Reaves, 546 So.2d 744 (2nd DCA 1989)………………………………………19 Roberto v. Allstate Insurance Co., 457 So.2d 1148 (3rd DCA 1984)……….…………………………….42 Rose Hall LTD v. Chase Manhattan Overseas Banking, 576 F. Supp. 107 (D. Del. 1983)…..…………………………............18 Ross v. Bandi 566 so.2d 55 (4th DCA 1990)…………….………………………..…48 Smith v. Brown, 525 So.2d 868 (Fla. 1988)……………….…………………………..28 Smith v. Silberman, 586 So. 2d 467 (3d DCA 1991)………….……………………….….18 State of Maine v. Ruybal v. Armstrong, 408 A.2d 1284 (Me. 1979)...................................................................20 Swafford v. State, 679 So.2d 736 (Fla. 1996)…………………...……………………….48 Teresa Marie Schiavo v. Michael Schiavo, 800 So. 2d 640 (2nd DCA 2001)……………...………………………23 Tingle v. Dade County Board of County Commissioners, 245 So.2d 76 (Fla. 1971)………………………..…………………14, 16 Topps v. State, 685 So.2d 1253 (Fla. 2004)……………………..…………………11, 14 United States v. Fernandez, 136 F.3d 1434 (11th Cir. 1998)…………………..…………………….48 United States v. Martinez, 14 F.3d 543 (11th Cir. 1994)……………………..……………….……48
United States v. Posner, 644 F. Supp. 885 (S.D. Fla. 1986)………………..………………….49 United States v. Radatz, 447 U.S. 667 (1980)……………..…………………….……………19 United States v. Robinson, 54 F.3d 564 (9th Cir 1995)………..………………………………….5 Wiley v. Wiley, 546 So.2d 1149 (4th DCA 1989)….…………………………………48 Rules Rule 3-7.7 (c)(5) The Rules Regulating the Florida Bar……………… 10 Rule 4-8.4 (c), The Rules Regulating the Florida Bar .………….…2, 4, 37 Rule 1.540 (b)(3), The Rules Regulating the Florida Bar ………….…...23 Florida Rule of Civil Procedure 1.190 …………………………………....9 Florida Rule of Civil Procedure 1.530…………………………6, 14, 15, 16 Florida Rule of Civil Procedure 1.540………..1, 5, 7, 10, 11, 12, 13, 14, 15 Florida Rule of Civil Procedure 1.540 ( b)………………………………...7 Federal Rule of Civil Procedure 63……………………….………11, 17, 18
STATEMENT OF THE ISSUES
I. WHETHER THE SUCCESSOR REFEREE INCORRECTLY RULED THAT THE EVIDENCE PRESENTED IN KARTEN’S MOTION TO SUPPLEMENT THE RECORD AND FOR REHEARING (FEBRUARY 8, 2001) AND HIS MOTIONS TO RELINQUISH JURISDICTION IN ORDER TO PURSUE NEWLY DISCOVERED EVIDENCE FILED DURING HIS APPEAL WERE PRECLUDED FROM CONSIDERATION.
II. WHETHER THE SUCCESSOR REFEREE, IN A NON-JURY PROCEEDING, FAILED TO FOLLOW THE CORRECT PROCEDURE FOR REVIEWING A MOTION FOR NEW TRIAL FILED PURSUANT TO FLORIDA RULE OF CIVIL PROCEDURE 1.540.
III. WHETHER, ASSUMING THAT A NEW TRIAL IS NOT MANDATED, THE SUCCESSOR REFEREE IS REQUIRED TO HOLD AN EVIDENTIARY HEARING.
STATEMENT OF THE CASE AND RELEVANT FACTS
In February of 2000, the Florida Bar filed a complaint against Appellant, Alan
Ira Karten (herein referred to as “Karten”). The complaint sought sanctions against
Karten on two bases. First, the Complaint alleged that Karten violated the Criminal
Justice Act (“CJA”) by taking four automobiles that the complainant, Nelson
Loynaz (herein referred to as “Loynaz”) allegedly owned and had forfeited to the
United States in his criminal case as fees for services performed under his court
appointment. Second, the Complaint alleged that Karten engaged in a scheme to
defraud Loynaz out of the four automobiles by buying them back from the United
1
States, without Loynaz’ permission, and selling them for a profit. The Bar alleged
that this conduct violated Rule 4-8.4(c) of the Rules Regulating the Florida Bar
(“[a] lawyer shall not engage in conduct involving dishonesty, fraud, deceit, or
misrepresentation).
After hearings before referee, Judge Gerald Bagley, Karten was found guilty of
violating Rule 4-8.4 (c). According to the referee, Loynaz was more “credible”
than Karten, because Loynaz allegedly had “no discernible motive…to testify
untruthfully”
Karten filed a Motion to Supplement Record and for Rehearing. Karten sought
to reopen the case and submitted affidavits of Dennis Bruce, Esq., Robert Ira
Woltin, and Ira Baraz. Bruce’s affidavit corroborated Karten’s version of the
events and contradicted Loynaz’ false hearing testimony that he never spoke to
Karten. Woltin’s affidavit also corroborated Karten’s version of the events and
confirmed that Karten was unaware that he was being credited with a $24,000
contribution by his partners from the sale of one Corvette to Duncan. Baraz’
affidavit confirmed the same. Karten also submitted the deposition of Robert Ira
Woltin, dated November 30, 1999 in which Woltin, in 1999, before the hearing,
testified that he did not have “the faintest idea” where Karten’s contribution came
2
from (offered as proof of Woltin’s perjury at the hearing) and proffered the
testimony of Elena Garcia, Karten’s former secretary. (Garcia corroborated
Karten’s version of the events, corroborated that Loynaz acknowledged the
agreement with Karten and established another motive for Loynaz’ false testimony,
i.e. his displeasure with Karten’s inability to procure a sentence reduction for him.)
Karten also produced his telephone records, which conclusively proved that
Loynaz’s hearing testimony was false. Karten requested that the referee reconsider
his findings in light of the additional evidence and testimony that had been
uncovered that showed that Loynaz and Woltin had testified falsely during the
hearings.
On February 27, 2001, Karten’s motion was summarily denied.
Karten appealed the referee’s Report and Recommendation to the Florida
Supreme Court. While the appeal was pending Karten filed a number of motions,
including Appellant’s Amended Motion To Supplement The Record Or To Take
Judicial Notice Of Certain Documents, Respondent’s Motion to Relinquish
Jurisdiction in Order to Pursue Newly Discovered Evidence, Respondent’s Motion
to Supplement Motion To Relinquish Jurisdiction in Order to Pursue Newly
3
Discovered Evidence, Respondent’s Motion To Supplement Motion To Relinquish
Jurisdiction In Order To Pursue Newly Discovered Evidence and Respondent’s
Second Motion To Supplement Motion To Relinquish Jurisdiction In Order To
Pursue Newly Discovered Evidence.
In The Florida Bar v. Alan Ira Karten, 829 So.2d 883, 891 (Fla. 2002) this
Court denied these motions in a footnote without discussion or a citation.
This Court affirmed the Report and Recommendation of the referee holding
that Karten violated Rule 4-8.4 (c) of the Rules Regulating the Florida Bar. The
Court, however, did not find that Karten violated the Criminal Justice Act by
accepting an unauthorized fee under the act but that Karten made an unauthorized
profit from the sale of the vehicles. For Karten to not have made an unauthorized
fee under the CJA, this court, by logical inference, must have accepted Karten’s
assertion that Karten was permitted to charge Loynaz for any additional
representation after his sentencing since then existing case law provided that
Loynaz was not entitled to court appointed counsel to represent him in civil or
criminal forfeiture matters. See, Austin v. U.S., 113 S.Ct. 2801 (1993); U.S. v.
Robinson, 54 F.3d 564 (9th Cir 1995).
4
On October 9, 2003, Karten filed a Motion for New Trial Based Upon
Evidence that Arose or was Discovered after the Hearing Before the Referee along
with an Appendix. The motion alleged newly discovered evidence, perjury and
fraud.
Judge Bagley refused to consider the motion and held that he was without
jurisdiction. The motion was filed pursuant to Florida Rule of Civil Procedure
1.540. The Bar mistakenly argued Rule 1.530. This Court entered the following
order:
Respondent’s petition for writ of mandamus is granted. The motion for rehearing filed before the trial judge, as referee, is treated by the Court as a motion filed
pursuant to Florida Rule of Civil Procedure 1.540 and is granted. The Court finds that the referee has jurisdiction
over petitioner’s motion to for new trial and should consider that motion on its merits.
Karten filed a motion to recuse the referee. The motion alleged, in part, that the
referee fabricated testimony and attributed it to Loynaz to support his conclusion
that Karten was less credible than Loynaz.
This Court in its opinion acknowledged that Karten’s disbarment was based
5
upon the referee’s conclusion that Loynaz had “no discernible motive on his part
to testify untruthfully…irrespective of his several felony convictions”
This Court also quoted the referee’s explanation of why, in part, the referee
believed Loynaz over Karten:
Mr. Karten presented testimony and other evidence in an attempt to show that Mr. Loynaz was not the lawful owner of the aforementioned vehicles, or in the alternative, even if he was the lawful owner, counsel was lawfully hired by Mr. Loynaz to handle this matter as an administrative forfeiture not covered by the Criminal Justice Act. The former assertion is belied by credible testimony by Mr. Loynaz that he purposefully masked the ownership in the vehicles to avoid their seizure and forfeiture in the event of an arrest on drug charges.
The successor referee quoted this court’s opinion which quoted the above
referenced fabricated testimony cited by the first referee to rationalize why
Loynaz’ admission in Loynaz v. Karten, Case # 02-6097CA21 (Cir. Ct. 11th Jud.
Circuit 2002), that Tropikar Sales, Inc. was the owner of the vehicles in question,
was not a repudiation of his bar testimony.
This “testimony” of Loynaz does not exist. It was fabricated by the referee
as alleged in Karten’s motion for recusal.
6
The recusal motion was granted on May 13, 2004.
Judge Jacqueline Hogan Scola was appointed as successor referee.
The Florida Bar then moved for clarification the Court’s order granting
the Mandamus. The Bar sought clarification of that part of the Court’s original
order which stated that “The motion for rehearing filed before the trial judge, as
referee, is treated by the Court as a motion filed pursuant to Florida Rule of Civil
Procedure 1.540 and is granted.”
The Court entered the following clarification order:
The Florida Bar’s Motion for Clarification is granted. This Court’s previous order dated April 21, 2004, granting Respondent’s petition for writ of mandamus is clarified and amended by this order. Respondent’s “Motion for New Trial Based Upon Evidence that Arose or was Discovered After the Hearing Before the Referee,” filed before the trial judge, as Referee, is treated by the Court as a motion filed pursuant to Florida Rule of Civil Procedure 1.540(b). The petition for writ of mandamus to require the referee to consider and rule on the merits of that motion is granted. The Court find’s that the referee has jurisdiction over respondent’s “Motion for New Trial Based Upon Evidence That Arose or Was Discovered After The Hearing Before the referee.” and the referee should consider that motion on its merits within (90) days of this order.
On August 6, 2004, Karten filed a motion for issuance of a Subpoena Duces
Tecum directed at the Federal Bureau of Prisons for 1997 visitation logs
7
(to prove dates of Kartent-Loynaz visits); motion to interview witness
Horacio Alba Sardinas (who Karten located in prison in Italy. Sardinas, according
to Loynaz’ testimony sold the cars in question to Loynaz) and a motion to
subpoena FBI 302 Reports (to prove Loynaz’ perjury. Loynaz had filed an affidavit
in his civil lawsuit against Karten, post trial, in which he claimed that the United
States Attorney’s office was informed by him that he purchased the automobiles
with drug proceeds. If Loynaz’ claim is true it will be reflected in a 302 report, if
not, Loynaz is a perjuror). A claim denied by FBI Special Agent Scott Wiegman.
The referee held a status conference on August 16, 2004. Memorandums were
filed at the request of the referee. Karten filed an Appendix to Response To
Florida Bar’s Reply and Position on Evidentiary Hearing With Incorporated
Memorandum of Law. That Appendix, which is part of the Appendix submitted to
this Court contained in excess of a hundred pages of newly discovered documents
including new documents not submitted as part of the original Motion for New
Trial. The documents included documentary proof that the testimony of both Carl
Karmin and Robert Woltin was perjurious and the redacted ledger submitted by
Karmin and introduced by the Bar was a falsified document. Among the new
allegations supported by newly discovered documents were the following:
8
• the unredacted ledger did not reflect a $9,000 cash contribution of Karten to the corporation.
• Woltin applied the $24,000 (credited to Karten) from the Duncan sale in his submission to the Bureau of Alcohol Tobacco and Beverages when he applied for a liquor license for 201 East Atlantic Investments, Inc.
• The documents used by Karmin to substantiate the falsified ledger had been “eaten by rats” according to Karmin and therefore could not be produced.
• Woltin forged Karten’s signature on sale documents for the other corvette and crated a fraudulent bill of sale for the vehicle as well as creating a fraudulent sales document.
Karten moved the successor referee to permit supplementation of the record
pursuant to Florida Rule of Civil Procedure 1.190.
The referee issued her Amended Report and Recommendation November 8,
2004. In her report, the successor referee incorrectly stated that “The Respondent
has alleged twelve (12) facts or items which he claims are new and would have, if
known at the time of the trial, resulted in a different outcome.” The successor
referee’s analysis was premised upon inapplicable case law and ignored scores of
additional documents and facts.
Karten moved for a rehearing pointing out that the successor referee had not
ruled upon his Motion to Amended or Supplement his motion for new trial. The
successor referee stated, “I think it’s granted.
9
I addressed it in there (referring to her Amended Report and Recommendation) it is
in there and that request was granted,” but refused to enter a written order in
conformity. A transcript is provided in the Appendix.
STANDARD OF REVIEW
A lawyer seeking to review of a Referee’s Report must demonstrate that the
report “is erroneous, unlawful or unjustified.” Rule 3-7.7(c)(5) of The Rules
Regulating the Florida Bar. To be upheld, a Referee’s findings of fact must be
“supported by competent, substantial evidence, “ The Florida Bar v. Clement, 662
So.2d 690, 696 (Fla. 1995), and will be reversed if clearly erroneous. The Florida
Bar v. Weiss, 586 So.2d 1051, 1053 (Fla. 1991).
SUMMARY OF THE ARGUMENT
I. The sucessor referee’s report and recommendation should not be approved by
the Court as the sucessor referee failed to consider all of the evidence
presented by the Appellant in support of his motion for new trial filed
pursuant to Florida Rule of Civil Proceedure 1.540.The successor referee
incorrectly held that this Court’s denial of Karten’s motions to temporarily
relinquish jurisdiction during his direct appeal precluded the successor
10
referee from considering the information presented in those motions because
this Court’s denial constituted law of the case. The successor referee also
incorrectly ruled that she could not consider any evidence presented before the
original referee as an appendix to Karten’s Motion to Supplement and for Re-
Hearing. The successor referee should have considered all of the evidence, as the
“law of the case” doctrine did not apply since there was no decision on the merits.
Topps v. State, 685 So.2d 1253 (Fla. 2004).
II. The successor referee, in a non-jury proceeding, failed to follow the correct
procedure for reviewing a Florida Rule of Civil Procedure 1.540 motion. This
Court should adopt a procedure similar to Federal Rule of Civil Procedure 63. The
Federal Rule requires that a successor referee must hear the testimony of witnesses
where credibility is an issue. Other jurisdictions have adopted this procedure and
support the principle that a successor judge in a non-jury proceeding must hear the
testimony of witnesses. Further, where the successor referee is required to resolve
conflicting evidence or pass on the credibility of witnesses a new trial should be
ordered.
III. The successor referee was required to hear Karten’s motion “on its merits”
11
pursuant to this Court’s clarification order “on the merits” requires an evidentiary
hearing. Assuming that a new trail is not required and that the Court did not order
an evidentiary hearing, the pleadings were sufficient to mandate an evidentiary
hearing. Karten proffered sufficient evidence that constituted more than a colorable
entitlement to 1.540 relief.
ARGUMENT
I. THE SUCCESSOR REFEREE INCORRECTLY RULED THAT THE EVIDENCE PRESENTED IN KARTEN’S MOTION TO SUPPLEMENT THE RECORD AND FOR REHEARING (FEBRUARY 8, 2001) AND HIS MOTIONS TO RELINQUISH JURIDSDICTION IN ORDER TO PURSUE NEWLY DISCOVERED EVIDENCE FILED DURING HIS APPEAL WERE PRECLUDED FROM CONSIDERATION.
This successor referee’s recommendation is reversible because she failed to
consider all of the evidence. Not only did the successor referee fail to consider all
the evidence she excluded evidence from consideration by incorrectly apply the
doctrine of law of the case.
The successor referee dismissed Manny Mesa’s affidavit (points 6,7 and 8 of
her report) as “not new information.” But Mesa’s affidavit was obtained after the
12
original hearing in 2000. The successor referee held that Karten’s motions to
the Supreme Court, denied, without citation, in Footnote 7 of the opinion was law
of the case and therefore were precluded from consideration. Additionally, the
successor referee failed to address any of the testimony, proffers or documents
submitted to the first referee in Karten’s Motion to Supplement the Record and for
Re-Hearing.
In support of the successor referee’s conclusion that the motions to the
Supreme Court and the rehearing motion addressed to the first referee the
successor referee cited Florida Department of Transportation v. Juliano, 801
So.2d 101 (Fla. 2001). Never the less the successor referee acknowledged:
It is unclear whether the Supreme Court reviewed and denied these motions on their merits or simply declined to consider them at all because of their untimeliness.
The newly discovered evidence presented to the original referee in Karten’s
Motion to Supplement the Record and for Re-Hearing and all of the newly
discovered evidence presented to the Supreme Court by way of motion should
have been considered by the successor referee. The denial of the rehearing motion
(Florida rule of Civil Procedure 1.530) and denial of the motions addressed to the
13
Supreme Court does not constitute law of the case. The newly discovered
evidence previously presented may be considered when incorporated in a motion
for new trial under Florida Rule of Civil Procedure 1.540. A ruling on a motion
does not, in any event, preclude admissible evidence from being introduced in
support of another motion.
In Juliano, supra, this court held that the law of the case requires that
questions of law actually decided on appeal must govern the case in the same court
and the trial court through all subsequent proceedings. This Court added:
Further, where a previous appellate court has given no explanation for its decision, a subsequent appellate court is not bound by the law of the case…
The doctrine of law of the case does not apply if a prior a appeal or motion
was decided on procedural grounds. McBride v. State, 810 So.2d 1019 (5th DCA
2002). A prior per curium, affirmed is not law of the case.
Recently this Court readdressed the doctrine in Topps v. State, 685 So.2d
1253 (Fla. 2004), reaffirmed that a ruling must be on the merits to be decided. A
judgment rendered on any grounds which do not involve the merits of the action
may not be used as a basis for the operation of the doctrine of res judicata. The
14
Court clarified that this holds true for appellate rulings on specific writs.
Court’s reasoning logically applies to motions for new trial pursuant to
Florida Rule of Civil Procedure 1.530, which were summarily denied without
opinion or citation and to motions to relinquish jurisdiction to pursue newly
discovered evidence during an appeal. As this court stated:
Writs may be denied in the appellate courts for many other reasons besides an adjudication on the merits. Where the denial is to a Writ or as in this case where a motion is discretionary and not an absolute right it is not law of the case.
When a court intends to deny an extraordinary writ, the court need only to
include a simple phrase “with prejudice” or “on the merits” to indicate that the
merits of the case have been determined and that the denial is on the merits.
Neither referee Bagley nor this Court noted any thing that would support a
finding that there was an adjudication on the merits. This Court ruled:
To insure that litigants and the courts alike are clear as to the legal effect of unelaborated denial orders, henceforth, if a Florida court denies a writ petition with the intent that the denial be on the merits, language to that effect must be included in the order.
Finally, a denial of a Florida Rule of Civil Procedure 1.530 motion does
15
not as a matter of law preclude inclusion or admission of the same evidence in a
motion filed pursuant to Florida Rule Civil Procedure 1.540. The successor referee
incorrectly applied the doctrine of law of the case and confused the difference
between a ruling on a motion and the admissibility of evidence supporting the
motion in another hearing.
The newly discovered evidence presented to referee Bagley and to this court by
way of motion, during the pendency of Karten’s appeal, should have been
considered by the successor referee.
II. THE SUCCESSOR REFEREE, IN A NON-JURY PROCEEDING, FAILED TO FOLLOW THE CORRECT PROCEDURE FOR REVIEWING A MOTION FOR NEW TRIAL FILED PURSUANT TO FLORIDA RULE OF CIVIL PROCEDURE 1.540.
Florida has no rule of procedure comparable to Federal Rule of Civil
Procedure 63. Appellant suggests that the Federal Rule should be adopted by the
Court to insure due process of law. The Florida Supreme Court has expressly
indicated that a successor judge is entitled to entertain a Florida Rule of Civil
Procedure 1.540 motion, Tingle v. Dade County Board of County Commissioners,
16
245 So. 2d 76 (Fla. 1971), but the Court has not lent guidance as to how a
successor judge, after a jury or non-jury trial or hearing, is to conduct that task.
Federal Rule of Civil Procedure 63 provides as follows:
If a trial or hearing has been commenced and the judge is unable to proceed, any other judge may proceed with it upon certifying familiarity with the record and determining that the proceedings in the case may be completed without prejudice to the parties. In a hearing or trial without a jury, the successor judge shall at the request of a party recall any witness whose testimony is material and disputed and who is available to testify again without undo burden. The successor judge may also recall any other witness.
As of the writing of this brief there are no Florida appellate court
opinions that outline the procedure a successor judge must follow in
determining the merits of a motion for new trial filed pursuant to Florida
Rule of Civil Procedure 1.540 where the hearing or trial was without a jury.
Only one Florida appellate court has suggested a methodology after a jury
trial. In National Health Care v. Cascio, 725 So.2d 1190 (2nd DCA 1998)
the court outlined the procedure for a successor judge to follow in reviewing
a motion for new trial based upon manifest weight of the evidence after a
jury trial. The court recognized that even after a jury trial a “successor judge
may still grant a new trial on the ground that he cannot fairly rule upon the
specific motion for new trial in light of particular credibility issues in the
record.”
17
Federal Rule 63 also recognizes that the procedure a successor judge must
follow is different depending on whether the trial or hearing is with or without a
jury and whether credibility assessments will have to be made by a successor
judge.
Federal Rule of Civil Procedure 63 always permitted a successor judge to decide postrial motions in a case in which finding of fact and conclusions of law had been filed. See, e.g. David E. Lever v. United States of America, 443 F.2d 350,351 (2nd Cir 1971); Rose Hall LTD v. Chase Manhattan Overseas Banking, 576 F. Supp. 107,125 (D.Del. 1983) aff’d without opinion 740 F.2d 956 (3rd Cir. 1984) cert. denied 469 U.S. 1159 (1985) (applying Federal Rule of Civil Procedure 63 to allow a successor judge who did not preside at trial to decide a motion notwithstanding verdict, so long as the successor judge is not required to evaluate credibility of witnesses) Lashbrook v. Kennedy Motor Lines, Inc., 119 F. Supp. 716 (W.D. Pa. 1954).” Canseco v. USA, 97 F.2. 1224 (9th Cir. 1996). Emphasis added.
In Smith v. Silberman, 586 So. 2d 467 (3d DCA 1991) the court was presented
with a situation where, in a prior appeal it had ordered the trial court to hear the
testimony of a previously excluded witness. In the interim, the original trial judge
recused himself. The successor judge only heard the testimony of the previously
excluded witness. The successor judge considered the record but heard only the
one witness. The Court ruled that absent a stipulation to the contrary a successor
judge may not weigh and compare evidence heard before a prior judge. A
successor judge who does not hear all the evidence may not enter a judgment.
18
e.g. Reaves v. Reaves, 546 So.2d 744 (2d DCA 1989).
When the successor judge became responsible for the completion of the case, it required that he not only hear and evaluate the surviving wife’s testimony, but the estate’s evidence as well which, when properly evaluated, might change the result. The successor judge necessarily had to hear and evaluate all of this testimony directed to the issue of the gift in order to perform the quintessence of the function of the trier of fact in assessing not only the credibility of the testimony but the weight which it was accorded.
The Reaves case is important because like this case it was non-jury.
The Federal Rule recognizes that when a successor judge is called upon to rule
upon a motion for new trial which necessarily requires a credibility finding a
successor judge must rehear the witness whose credibility is at issue. See, Federal
Rule of Civil Procedure 63. See also, Advisory Committee Notes to 1991
Amendment to Rule 63 (“The court would, however, risk error to determine the
credibility of a witness not seen or heard who is available to be recalled. Cf.
Anderson v. City of Bessemer City NC, 470 U.S. 564, 575 (1985); Marshall v.
Jerrico, Inc., 446 U.S. 238, 242 (1980). See also, United States v. Radatz, 447 U.S.
667 (1980).
The courts are uniform that a successor judge may rule on a motion for new
trial unless there are credibility issues.
The court in National Healthcorp Limited Partnership, supra, recognized
this rule. “We caution that this holding does not rule out the possibility that the
successor judge may still grant a new trial on the ground that he cannot fairly rule
upon the specific motion for new trial in light of particular credibility issues in the
19
record….[T]hus the type of credibility issue that mandate a new trial, as a matter of
law, would normally occur only when the first judge could have granted a new trial
because of a witness’s demeanor while testifying of perhaps due to the
impeachment of a witness.” See, State of Maine v. Ruybal v. Armstrong, 408 A.2d
1284 (Me. 1979) (new trial may be granted where it is clear that newly discovered
impeachment evidence would have resulted in a different verdict.)
Although the successor referee applied the wrong law in assessing whether
Karten was entitled to an evidentiary hearing, (See, infra,) she recognized that she
would have to assess credibility in her determination as to whether the newly
discovered evidence would “probably change the result if a new trial is granted.”
In a hearing which was determined upon a credibility finding the successor referee
cannot determine if the newly discovered evidence would probably result in a
different credibility finding by reading a cold record. The successor referee’s
determination, without hearing testimony, that credibility evidence would not
change the outcome is flawed
The successor judge would have to evaluate each witness. See, e.g.
Anderson v. Dewey, 350 P.2d 734 (Idaho 1960)(In a case where the successor
judge, after a non jury trial, in resolving the issues raised by a motion for new trial
is required to resolve conflicting evidence or pass upon the credibility of witness a
new trial should be ordered)
In Federal Deposit Ins. Corporation v. Siraco, 174 F.2d 360 (2nd Cir 1949)
The Court held that where the testimony of the defendant and his witness was
sufficient to support finding for the defendant, but facts raised a suspicion as to
verity of their testimony, and judge to whom case was referred after death of judge
20
who heard testimony, and who made finding in favor of defendant, did not see
witnesses, the case should be reversed and a new trial ordered before a judge who
could decide after seeing witnesses. Accord; Grudzina v. New Mexico Youth
Diagnostic and Development Center, 725 P. 2d 255 (N.M.App 1986)(credibility of
a witness may be so vital that a new trial is required even when the parties have
stipulated to the successor judge’s authority to decide case after former judge is
disabled, in which case successor judge has discretion to order new trial)
This importance of the newly discovered evidence is underscored by the
referee’s finding that Karten was not credible and that Loynaz was. “With regard
to Mr. Loynaz’ credibility, no discernible motive on his part to testify untruthfully
has been established from the evidence, irrespective of his several felony
convictions.” (The referee made this statement despite the Bar’s seeking
restitution.) This Court also acknowledged, in its opinion, that this original bar
proceeding was decided on credibility. “The referee in the instant case assessed
Karten’s credibility and chose to credit the testimony of other witnesses over
Karten’s testimony.” The successor referee, in her report, dismissed the fact that
Loynaz filed a civil lawsuit against Karten and that his wife sought a one half
interest in any monetary judgment in her divorce proceeding, because either had “a
vested interest in any lawsuit which might be filed”(as would any married couple)
and was argued before the referee as bias or motive.” If it was discernable motive
to lie (financial stake in the proceedings) than the finding of the referee was wrong.
If it was not a discernible motive according to the first referee the successor referee
missed the significance of the evidence.
21
The successor referee, to rule on Karten’s motion for new trial, has to resolve conflicting evidence and determine the credibility of witnesses and therefore the Court should remand this cause and order a new trial.
III. ASSUMING THAT A NEW TRIAL IS NOT MANDATED THE SUCCESSOR REFEREE IS REQUIRED TO HOLD AN EVIDENTIARY HEARING
This court, in two different orders referred this matter to the referee to be
heard on its merits. The plain meaning of “on its merits” mandated that the
successor referee hold an evidentiary hearing. The Court de facto found that Karten
met the necessary threshold, on the pleadings, when it ordered the new trial motion
to be heard on its merits.
In the order clarifying its first order the Court stated:
The Court finds that the referee has jurisdiction over Respondent’s Motion for New Trial and should consider that motion on its merits within ninety (90) days of this order.
Blacks Law Dictionary defines on the merits as follows:
on the merits: (of a judgment) delivered after the court has heard and investigated the substantive arguments of the parties. [vs.]
on the pleadings: (of a judgment) rendered without hearing or evaluating the full arguments of the parties.
The Third District has clearly defined the legal requirements mandated for
22
hearing a matter on the merits. In Herwitt vs. Caffee, 368 So.2d 1342 (3d
DCA, 1979), the claimant alleged that the judicial referee failed to give her a
hearing on the merits of her motion. The judge allowed only the introduction of
medical records at the hearing without receiving further evidence. The reviewing
court found this process insufficient in meeting the legal requirements of hearing a
case on the merits.
THE PLEADINGS SUPPORT AN EVIDENTIARY HEARING
The evidence presented to the successor referee established a colorable
showing that fraud was committed and that witnesses testified falsely.
Karten’s allegation of fraud and false testimony by Nelson Loynaz, as well
as the discovery of the fraudulent nature of the vehicle documents, falsified records
of 201 East Atlantic Investments, Inc and the presentation of unexpected false
testimony raised more than a colorable entitlement to 1.540 relief and required an
evidentiary hearing. See, Dynasty Express Corp. vs. Weiss, 675 So.2d 235 (4th
DCA 1996) (if the allegations in the moving party’s motion for relief from
judgment raise a colorable entitlement to Rule 1.540(b)(3) relief, a formal
evidentiary hearing on the motion, as well as permissible discovery prior to the
hearing is required). See also, In re Guardianship of Teresa Marie Schiavo v.
Michael Schiavo, 800 So. 2d 640, (2nd DCA 2001).
23
After discovering that his cooperation with the United States was not going
to result in a significant sentence reduction, Nelson Loynaz did what numerous
clients do - turned on his attorney and filed a bar complaint against him. Loynaz
testified that he entered into an agreement with the United States whereby he was
to receive four vehicles in exchange for the sum of $30,000.00 that his friend
Manny Mesa was to provide. Mesa was to sell the vehicles and split the proceeds.
(Coincidentally, the same agreement Karten testified he had with Loynaz). He was
unable to sell the vehicles because Karten, he testified, picked up and sold the
vehicles without his authorization or agreement.
The first referee primarily relied upon the testimony of Loynaz and his wife,
Mary for corroboration. They testified that Loynaz’ friend, Manny Mesa had a
$30,000.00 check to be deposited in Karten’s trust account to be used to satisfy the
agreement with the government. Nelson Loynaz committed fraud by falsely
testifying that he had no agreement with Karten to sell the four forfeited vehicles
and that Manny Mesa had the funds to purchase the vehicles.
The referee found that Karten made a profit from the sale of a corvette to
Thomas Duncan. This was corroborated, according to the referee, by Karten’s
business partner, Karl Carmin who submitted a redacted and falsified exhibit
indicating that Karten received the benefit of $24,000 from the sale of the Duncan
24
corvette as a capital contribution to the corporation. The documents supplied by
Karten’s ex-partner, Karl Carmin were fraudulent, the alleged supporting
documents “were eaten by rats” and the supporting documents contained false
information and forged signatures of Karten.
According to Duncan, Woltin supplied a falsified bill of sale for the
corvette. That document was never produced by Duncan or Woltin. Woltin’s
forging Karten’s signature on that document would be consistent with Woltin’s
other forgery of Karten’s signature. (Woltin’s forgery of Karten’s signature on an
identical purchasing agreement to that of Duncan’s and the actual title on a second
corvette is presently under investigation by law enforcement and is part of the
evidence presented to the successor referee.)
1. TWENTY (20) DAYS AFTER THE BAR HEARING MARY LOYNAZ FILES FOR DIVORCE ALLEGING AN INTEREST IN A CIVIL ACTION FILED BY HER THEN HUSBAND, NELSON LOYNAZ.
The original referee relied heavily on the “credibility of the witnesses” in
disbarring Karten. Clearly, the inclusion of the Karten civil lawsuit in her divorce
action a mere twenty (20) days after the hearing is not a coincidence and is
something that should have been disclosed during the course of the hearing.
Although Mary Loynaz refers to a civil lawsuit filed by her husband no such
25
lawsuit was, filed at the time her petition for dissolution was filed. It is reasonable
and logical to infer from that fact that Nelson and Mary had discussed filing a
lawsuit against Karten.
The successor referee states “Mary Loynaz was previously impeached on
her bias with regard to having a claim in any law suit which her husband might file
for recovery.” That is not what she said. What Mary Loynaz stated was:
Q: Okay. Mrs. Loynaz, if your husband obtains these cars or any monies from this or other litigation, you will benefit by that, will you not? A: Yes.
Mary Loynaz believed, at the time she testified, that her husband intended
on filing a civil action - as was filed for $300,000.00. This $300,000.00 lawsuit
and her planned interest in it, by way of divorce court, should have been disclosed.
In her divorce complaint, filed 20 days after she testified, she alleged that her
husband had filed a civil lawsuit against Karten. He had not. The lawsuit was filed
14 months later. This interest affects this witness’ credibility and was not
considered as a motive for Loynaz to give false testimony by the first referee. The
successor referee agrees that Loynaz had a motive to lie, a motive not recognized
by the first referee.
2. NELSON LOYNAZ FILED A LAWSUIT AGAINST KARTEN FOR $300,000 AND FAILED TO DISCLOSE THAT HE HAD HIRED A LAWYER TO SUE KARTEN
26
PRIOR TO HIS BAR TESTIMONY.
As evidenced above, Loynaz intended on filing this lawsuit against Karten
prior to the time of the hearing. Loynaz retained counsel months before his bar
testimony. Such a financial interest would affect any reasonable trier of facts
judgment of the credibility of a witness. The intention to file is evidenced by Mary
Loynaz divorce petition above. The successor referee dismisses these contentions
as “not likely to effect the outcome of the case.” A conclusion that necessarily
makes a credibility determination. The original referee in his report specifically
stated that other than Loynaz’ 12 felony convictions he had no discernable motive
to lie. There is no greater discernable motive to lie than having a financial stake in
the outcome of a proceeding. Loynaz’ financial motive was not considered by the
original referee. The successor referee dismisses this testimony as not newly
discovered material. The evidence was discovered after the bar hearing. The
successor referee also dismisses the evidence because the “evidence in this case is
overwhelming and compelling, it has not been shown to be likely that this evidence
would have resulted in a different outcome.” Again, the successor referee ignores
that such a conclusion requires credibility assessments. See, Karten’s prior
argument regarding successor judge not making credibility determinations without
27
hearing testimony. The successor referee’s comment on the weight of the evidence
is remarkable in that the successor referee did not certify that she read the record
nor did she hear any testimony. In evaluating the weight of the evidence a trier of
fact must make credibility determinations. Smith v. Brown, 525 So.2d 868 (Fla
1988).
2. MARY LOYNAZ NOW SAYS THAT SHE NEVER SAW A $30,000 CHECK FROM MANNY MESA AND THAT ALL HER TESTIMONY CONCERNING ANY AGREEMENTS AS WELL AS ALL OTHER CORROBORATING TESTIMONY CAME FROM HER THEN HUSBAND - NELSON LOYNAZ.
At the trial, Mary Loynaz testified that she and Manny Mesa attempted to
tender a $30,000.00 check to Karten to pay for the cars - the heart of Loynaz’
allegation. In a civil deposition taken in Loynaz v. Karten, Case # 02-6097CA21
(Cir. Ct. 11th Jud. Circuit 2002) filed after the hearing, she states:
Q. Is it fair to say that the source of your information concerning whatever arrangements, if any, there were between myself (Karten) and Nelson Loynaz, was Nelson Loynaz?
A. Yes. Page 35 of Mary Loynaz’ deposition.
The deposition continues and on redirect, she reaffirms the above statement:
Q. And you have those understandings because that’s what Nelson
Loynaz told you. 28
A. As far as what?
Q. All those questions about what your understanding was putting up the money, bringing money, the meaning of the agreement, all these understandings of what the agreement was were because Nelson told you that’s what the agreement was?
A. Correct.
Q. You had no other outside source of information concerning the agreement, just what Nelson told you.
A. Right. Page 47 (emphasis added)
The successor referee ignored Mary Loynaz’ deposition testimony and concluded:
“Mary Loynaz does not ever say that she did not have personal knowledge.”
4. MARY LOYNAZ NOW ADMITS THAT SHE ATTENDED A MEETING AT THE JAIL WHERE THE AGREEMENT BETWEEN KARTEN AND LOYNAZ WAS DISCUSSED.
The successor referee stated: “[A]fter review of Mary Loynaz’ testimony
this Referee fails to find that the testimony referred to supports the conclusion that
Mary Loynaz’ testimony corroborates the Respondent’s testimony.” All of the
successor referee’s citations to the record are only to the testimony of Mary
Loynaz. The successor referee never certifies or even states that she read Karten’s
hearing testimony. However, Mary Loynaz’ post hearing deposition in the civil
case reveals that she did in fact witness a meeting between Karten and Loynaz at
29
which their agreement to sell the cars was discussed.
At the Bar hearing, Mary Loynaz never testified that she witnessed a
conversation between Loynaz and Karten “about the cars.” At the time, she was
still married to Loynaz. She now admits that she did so at a time when she was at
the jail at the same time as Karten. Records confirm that this meeting took place
before the stipulation and settlement was executed. She states:
Q. Do you recall what we talked about? A. I know the two of you were discussing about the cars and
money, but don’t recall exactly why.
Q. Do you recall, when we discussed the cars, you were sort of listening to the two of us talk, basically?
A. Yes. Deposition testimony pages 35-36. (emphasis added)
Karten testified about this meeting with Loynaz at the Federal Corrections
Center at his bar hearing. (R 263 – 264.)
Mary Loynaz’s testimony corroborates Karten’s testimony and is
inconsistent with Loynaz’ bar hearing testimony. A reasonable trier of fact would
find that this testimony is of some “moment” in judging the credibility of both
Karten and Loynaz.
5. MANNY MESA SIGNED A SWORN POST HEARING STATEMENT THAT HE HAD NO AGREEMENT
30
WITH NELSON LOYNAZ TO SELL THE CARS FOR HIM AND NEVER HAD A $30,000.00 CHECK FOR KARTEN. HE FURTHER STATES THAT HE WAS NEVER ADVISED TO TALK TO THE UNITED STATES ATTORNEY AS STATED BY LOYNAZ IN HIS BAR TESTIMONY.
This is the smoking gun. Mesa was unavailable to testify for the Bar (or
Karten) at the time of the hearing. Yet, he is the witness who could have
corroborated Loynaz’ testimony, since he is the one who had agreed to pick up and
sell the cars for Loynaz and to talk to the United States Attorney.
The successor referee’s response is that Karten cannot present Mesa’s
testimony as it is precluded as “law of the case”. See, argument, supra. This post-
hearing document establishes that Nelson Loynaz lied at the hearing about having
an agreement with Manny Mesa to sell the cars and to talk directly to the United
States Attorney. A reasonable fact finder would find this significant in judging
Loynaz’ credibility as well as the Bar’s case in chief. Mesa’s affidavit was offered
to prove that Loynaz’ bar hearing testimony was false and unexpected.
6. LOYNAZ NOW ADMITS THAT THE VEHICLES WERE OWNED BY TROPIKAR SALES, INC., NOT HIM.
31
At the Bar hearing Loynaz told the referee that the cars were owned by him.
In Loynaz v. Karten, Case # 02-6097CA21 (Cir. Ct. 11th Jud. Circuit 2002) filed in
2002, in an answer to a request to admit - Loynaz admits that the cars were owned
by Tropikar Sales, Inc. The import of this is obvious, Loynaz testimony or
statements at any time are not worthy of belief. The actual titles to the vehicles
belie Loynaz’ testimony.
The successor referee refers to the Court’s opinion, which quotes the report
and recommendation of the first referee. The original referee stated that Loynaz
testified that he masked the ownership of the vehicles to avoid their seizure and
forfeiture. While this is a common process employed by professional criminals,
that statement is not in the record of the bar’s proceedings. In fact, Karten, in his
motion to recuse, alleged that the first referee fabricated this testimony to support
his conclusion. The successor referee now parrots this false statement. Loynaz
specifically testified that he kept the titles in their original names to protect their
value. In fact, an examination of the titles, will, without any doubt, show that
some of the titles were transferred to Tropikar Sales. Inc. years before Loynaz the
date that Loynaz testified they were. The 1967 Corvette title was transferred by
Quality Leasing, Inc. to Tropikar, Sales, Inc. in 1989. The Shelby title was never
transferred to Tropikar, Sales, Inc. (contrary to Loynaz’ testimony). The affidavit
32
of Manuel Fernandez, owner of Tropikar Sales, Inc. indicates that in 1994 he
owned the vehicles, not Loynaz. The newly discovered evidence is proof that the
Bar presented false testimony at the original hearing.
7. LOYNAZ’ STATEMENTS IN HIS POST HEARING DEPOSITION SUPPORTS THAT KARTEN WAS TO PUT UP THE FUNDS FOR THE CAR.
In his deposition in support of his civil lawsuit against Karten, Loynaz for
the first time seems uncertain as to whether Karten actually was the person with
whom he was going to sell the cars. Karten agrees that it is not a true admission.
However, if Loynaz does not remember what was said at the meeting with the
government than Karten’ testimony before the referee was uncontraverted.
8. LOYNAZ’ POST HEARING TESTIMONY AT DEPOSITION REGARDING STANDING CORROBORATES KARTEN AND LOGICALLY CONFLICTS WITH LOYNAZ’ BAR TESTIMONY
In his post hearing testimony, Loynaz admits that there was a necessity to
establish standing prior to discussions with the government regarding the
forfeiture of the vehicles. The testimony supports Karten’s testimony that he
argued that Loynaz could argue standing under a mechanics lien theory. The
successor referee states that she reviewed Loynaz’ deposition and Loynaz does not
concede the point.
33
Loynaz’ deposition at page 133-134:
Q: John Roth asked---- I remember that I told him that I did some work on the cars. Q: Right, and our argument was that we could have standing possibly file a challenge based upon a mechanic’s lien on the vehicles because you had done some repairs to the vehicles --- tires, paint or body work. I don’t remember what it is personally. Do you recall that? A: Yes. I remember something like that.
See, Karten’s hearing testimony at page 259.
The referee also ignored Loynaz’ subsequent affidavit in Opposition to
Defendant’s Motion for Summary Judgment filed in Loynaz v. Karten, Case # 02-
6097CA21 (Cir. Ct. 11th Jud. Circuit 2002) in which, under oath, Loynaz states
that:
1. He informed the U.S. attorney’s office that he owned the vehicles. (If so
why was standing an issue)
2. He told prosecutors that he bought the cars will illegal drug money.
3. A prosecutor told him he had a 50/50 chance of getting the cars back.
(Even though purchased with illegal drug money).
4. An assistant United States attorney told him they knew he would be
unable to provide proof of income for the purchase of the vehicles.
All of which is incredible and defies all common sense and reason. As a matter of
34
law, Loynaz is unworthy of belief. If any of Loynaz’ affidavit is true there would
not have been an issue as to standing nor an inquiry by AUSA Roth as to standing.
Loynaz simply would have asserted that he was the owner and the owner always
has standing.
9. THE DOCUMENTS SUBMITTED BY THE BAR
FROM 201 EAST ATLANTIC INVESTMENTS, INC. (THE RESTAURANT PARTNERSHIP) ARE FRAUDULENT, SIGNATURES ARE FORGED AND ROBERT WOLTIN AND CARL KARMIN COMMITTED MULTIPLE ACTS OF PERJURY.
The Bar introduced evidence and testimony to support its case that Karten
deposited the “profits” from the sale of the vehicles in his restaurant partnership,
201 East Atlantic Investments Inc. Testimony was presented that Robert Woltin
deposited $24,000.00 from the sale of one of the corvettes as a “credit” towards
Karten’s participation in the corporation. (Duncan sale) Karten testified that this
was done without his knowledge and that the $24,000.00 was not a “profit” to
Karten. Woltin testified at the Bar hearing in person. Karmin testified via
deposition.
The successor referee’s conclusions of the fraud allegations can be summarized
as follows:
35
1. Woltin’s 1999 deposition is not newly discovered evidence.
2. Baraz was known to the parties, therefore any possible
testimony of Baraz cannot be newly discovered.
3. Assertions of perjury by Karmin and Woltin are conclusory.
Assuming arguendo that they committed perjury, their
testimony was not material to the case. This was a theft case
and evidence regarding Karten’ finances “were merely
supplemental evidence.” The outcome of the case would be
the same.
The successor referee failed to understand Karten’s argument and the applicable
case law.
In Karten v. Karten, Case # 99-000210 on Nov. 30, 1999, Woltin, under oath,
testified that he “hadn’t the faintest idea” where Karten’s contribution came from.
Q. Do you know where that money came from? (referring to Karten’s contribution) A. I haven’t the faintest idea. It was either wired in, as I remember, either wired into the account or put in by check or cashier’s check. (Note: no mention of cash).
Baraz’ affidavit was presented as proof of Woltin and Karmin’s perjury or false
statements. Baraz offers testimony that he was directed by both Karmin and Woltin
to credit Karten with the $24,000 from the sale of the car to Duncan in the redacted
36
ledger. As noted, supra, a party is not required to anticipate false testimony from
the opposing party and, therefore, is not required to discover evidence that would
refute the false testimony. See, citations, supra.
The successor referee asserted, “this was a theft case.” The successor referee is
incorrect. The Bar alleged that Karten violated Rule Regulating the Florida Bar 4-
8.4(c) (lawyer shall not engage in conduct involving dishonesty, fraud, deceit, or
misrepresentation). The first referee relied heavily on the testimony of Woltin and
Karmin and the redacted ledger. Paragraphs 7 and 8 of his report and
recommendation deal entirely with Karten’s dealings with Woltin. The report is
replete with references to alleged violations of the Criminal Justice Act (which this
Court interpreted as “improper profit” allegations). “Moreover, Mr. Karten’s use of
a $30,000 loan from his wife as payment to satisfy the Stipulation and Settlement
Agreement, coupled with the financial returns on his business arrangement with
Mr. Woltin, further illustrates the extent of his irregular and deceitful conduct to
exclude and take advantage of Mr. Loynaz during his confinement in a federal
penitentiary outside of Florida.” Referee’s Report pg.5. If Woltin and Karmin are
lying, Karten did not make an improper profit. He made no profit at all.
The documents submitted with Karten’s new trial motion include the
unredacted ledger, which shows the purported contributions of Woltin and Karmin.
37
Also included are correspondence between Karten and Karmin in which Karten
seeks the “records” which Karmin testified where used to create the ledger. When
the records were requested, Karmin, the custodian of records, stated that there were
none because they “had been eaten by rats.” Karten filed two lawsuits. First, a
Mandamus action was filed pursuant to statute to produce the corporate records
and second, a lawsuit was filed for an accounting of 201 East Atlantic Investments,
Inc. An accounting was ordered and Karten engaged the services of Lewis
Freeman and Associates to conduct the accounting, which is still in progress.
Karmin testified at the Bar proceeding that the ledger was based upon bank
statements, deposit slips and checkbook stubs. When later asked to produce these
items, Karmin responded: “the records were eaten by rats.” Karten provided as an
exhibit to his new trial motion a copy of the bank records from Northern Trust
Bank and the deposit slip for the $24,000 deposit. There are no checkbook stubs.
The records do not indicate for whose benefit the deposit was made. According to
Baraz’ affidavit, submitted with the motion, in 1999, after Karten was thrown out
of the restaurant, Karmin and Woltin “informed (him) that $24,000 was to be
credited to Alan Karten as part of his contribution. Baraz never spoke to Karten
regarding the $24,000. Despite the inability to produce any of the supporting
documents, Karmin testified in Karten v. Karten, Case # 99-000210 (38) (91) on
38
March 15, 2000 that he didn’t know where Karten’s funds came from.
Q. Do you know where the funds from Alan Karten came from? A. No. I can’t, I didn’t see the checks as they came in, so I don’t know exactly where they came from.
Later in the deposition Karmin is shown a December 31, 1999 Financial
Statement of the corporation which is identical to the unredacted ledger as it relates
to partner contributions. Karmin testified that he doesn’t think the document
accurately reflects the contributions of the partners. Karmin testified:
Q: Do you know who prepared these documents? A: Our accountant. (Baraz) Q: Okay. Do you know where your accountant got the information to prepare these documents? A: I have no idea.
On May 25, 2004, in partial compliance with Judge Lewis’ order the
Defendants Woltin and Karmin turned over a note made by Baraz during their
meeting. On the document is a notation that Karten made a $9,000 cash
contribution which is not reflected on the redacted ledger submitted by the Bar.
Woltin and Karmin committed perjury and the Bar submitted a fabricated
document. Karten has made a colorable showing of fraud and was entitled to an
evidentiary hearing and discovery.
In summary:
39
A. Karmin submitted to the Bar a redacted and (fraudulent) general
ledger showing a “credit” of the $24,000.00 to Karten. The ledger was prepared in
March of 1999 after Karten was forced out of the restaurant. In his deposition,
filed with the court as evidence, Karmin testifies that he does not have the “faintest
idea” where the $24,000.00 contribution comes from. Baraz swears that Woltin
and Karmin told him to credit the money to Karten. In a post hearing deposition,
Karmin testifies that he did not know of the sale of the car until years later but
certainly after March of 1999.
B. Karmin took an additional $9,000.00 from Karten, which was
part of Karten’s contribution, and did not document the deposit in the redacted
general ledger or anywhere else.
C. Woltin correctly took the $24,000.00 credit and included it in
the application submitted to the Florida Division of Alcoholic Beverages and
Tobacco for the restaurant’s alcohol license. Specifically he stated that his
(Woltin’s) contribution was $129,000.00. Notably, the unredacted general ledger
submitted showed that Woltin’s contribution, as of the date of the alcohol license
application submission, was $105,000.00 to the restaurant - the difference being
$24,000.00, the exact amount that Woltin and Karmin directed Baritz to credit to
Karten later in 1999. Woltin cooked the books of the corporation and credited the
40
$24,000.00 to Karten without Karten’s knowledge. As soon as Karten was
removed from the restaurant, the same time the ledger taking a yearly salary of
$260,000.
D. Woltin lied during his bar testimony, created fraudulent
documents and forged Karten’s signature. During the course of his testimony,
Woltin stated that he bought the cars from Karten for $30,000.00. The accounting
revealed that Woltin executed subsequent sale documents on the vehicles stating
that he was acting on behalf of Karten as the seller - an inaccurate and untrue
statement - but one that saved him from the payment of sales and income tax. The
document was a form. It was identical to the form Woltin used with Duncan which
the Bar introduced before the referee. Duncan had testified at the Bar hearing that
Woltin provided him with a fake bill of sale that he could use to defraud the state
in the collection of sales tax. That bill of sale was never produced. Based on the
actions of Woltin it is reasonable to infer that Woltin forged Karten’s signature.
E. Woltin forged Karten’s signature on subsequent sale documents for the
second corvette, as well as creating a fraudulent sale price. Woltin is presently
under investigation by law enforcement. Handwriting exemplars have now been
taken and it is expected that Woltin will be criminally charged.
These documents have been discovered over a lengthy period of time. Some
41
have been requested after the discovery of other revealing documents. The
successor referee states that some of these documents or witnesses (Baraz) could
have been discovered prior to trial, however, this ignores that steps were taken to
create fraudulent documents and cover up other documents. An evidentiary
hearing is required on this issue alone. Karten did not go into the Bar hearing with
the knowledge that he was the victim of fraud by his business partners. The
documents only became available after the testimony and subsequent accounting.
A party is not required to anticipate false testimony from the opposing party
and, therefore, is not required to discover evidence that would refute the false
testimony. Roberto v. Allstate Insurance Co., 457 So.2d 1148 (Fla. 3rd DCA
1984); Kline v. Belko, LTD, 480 So.2d 126 (3rd DCA 1985); McDonald v. Pickens,
M.D., 544 So. 2d 261 (1st DCA 1989); Dynasty Express, Corp. v. Weiss, 675 So.2d
235 (4th DCA 1996).
Perjury constitutes fraud. Whether testimony is perjurious is requires an
evidentiary hearing. Davenport v. Dimitrijevic, 857 So.2d 957 (4th DCA 2003).
The referee ignored most of the evidence submitted by Karten, and failed to apply
the law.
In conclusion, as to the Bar’s “corroboration,” it is based on false documents
generated by an individual(s) who is about to be charged with fraud and forgery.
42
These are the only documents and testimony, which relate to Karten’s, alleged
profit from the sale of the cars and are the only physical evidence from which a
referee could question Karten’s credibility. A reasonable trier of fact would
question Loynaz’ testimony, as well as and more importantly the Bar’s case in
chief.
FAILURE OF THE SUCCESSOR REFEREE TO ADDRESS OTHER EVIDENCE
The successor referee did not address the newly discovered evidence that
was part of Karten’s Motion to Supplement the Record and for Rehearing filed
before the original referee. This pleading was filed immediately after the hearing
concluded but prior to the sanctions portion of the hearing. The original referee
declined to reopen the hearing notwithstanding the significance of the documents
contained therein.
That document contained new information including:
A. Ninety-three (93) collect phone calls from Loynaz to Karten.
The telephone calls were for ten to fifteen minutes each and continued through
January of 1998. The information directly conflicts with Loynaz testimony that he
was unable to speak with Karten and proves Loynaz’ testimony to be false.
43
B. The affidavit of Dennis Bruce, Esq. In his affidavit he states
that he shared space with Karten and that Nelson Loynaz called the office
numerous times and that he personally witnessed the secretary (Elaine Linder
Garcia) putting the Loynaz calls through to Karten. Bruce also states that Karten
freely spoke with him regarding his participation in putting up the $30,000.00 on
behalf of Loynaz, to sell the cars and divide the profit. This information
contradicted Loynaz testimony that Karten secretly “stole” his cars from him and
proves that the Bar, through Loynaz, presented false testimony.
C. The proffer from Karten’s then secretary, Elena Linder Garcia.
She would have testified that she had conversations with Loynaz and that Loynaz
was aware that Karten was taking the vehicles for future sale and that Karten was
putting up the money for the vehicles. Furthermore, at no time did Loynaz ever
tell her that Karten had stolen the cars. Finally, she would have testified that
Loynaz advised her that he was firing [Karten] because he did not get the 5K 1.1
Sentencing Reduction.
A 5K 1.1 motion is filed by the government specifically the United States
Attorney assigns to a specific criminal case, when he or she believes that a criminal
defendant has provided substantial assistance to the United States government.
The referee never heard this testimony. The successor referee ignored it.
44
Additionally the successor referee failed to address any of the newly
discovered evidence that was outlined in the pleadings filed before this Court
during the pendency of Karten’s original appeal.
Respondent’s motions to this court appended the following newly
discovered evidence:
1 A July 21, 2001 Miami Herald article in which Loynaz told a Miami Herald
reporter that he started a business “Exotic Toys” some six months earlier –
i.e. December 2000, the same month he testified before the referee by
borrowing $300,000. In the article, Loynaz states that he owned Blue Eagle
Body Shop, a 73-car operation in Hialeah, for years. If true, Loynaz
repeatedly perjured himself in official court proceedings.
The corporate records of Blue Eagle Paint and Body Shop, Inc., Hialeah,
Florida which do not reflect any interest of Nelson Loynaz.
3. Criminal records of Loynaz’ Exotic Toys partner Luis Fernandez and the
criminal records of Jaime Cruz who appears on the corporate records of
Blue Eagle Paint and Body Shop, Inc.
4. Criminal records of Jesus E. Rios, who also appears on the corporate
records of Blue Eagle Body Shop.
5. Complaint, Loynaz v. Karten, Case No. 02-6097(Cir. Ct. 11th Jud. Circuit).
6. Sworn statement of Manuel Alberto Mesa, July 1, 2002.
45
7. Deposition of Manuel Fernandez, Nelson Loynaz v. Alan I. Karten, Case No. 02-6097 (11) (Cir. Ct. 11th Jud. Circuit) (August 5, 2002)
8. Rule to Show Cause Pleadings and Order, Nelson Loynaz v. Alan I. Karten, Case No. 02-6097 (11) (Cir. Ct. 11th Jud. Circuit)
THE SIGNIFICANCE OF THE EVIDENCE
On Saturday, July 21, 2001, both the English and Spanish editions of The
Miami Herald published a front page article in the Business Section featuring none
other than the “vulnerable victim” Nelson Loynaz. In the few months since being
released from prison, Loynaz managed to become co-owner of a business “Exotic
Toys,” which leases luxury automobiles, including Porches and Ferraris, to movie
stars and the “hip” crowd on South Beach. Id. Loynaz told The Herald that he
allegedly started the business “from scratch” six months earlier—i.e., in December
2000, the same month he testified before the Referee herein—by “borrowing”
$300,000. However, the article provides a possible explanation for the alleged
loan. According to The Miami Herald , “Loynaz, 35, is no stranger to cars of all
kinds. He has owned Blue Eagle Body Shop, a 73-car operation in Hialeah, for
years”. Id.
If Loynaz has “owned a “73-car” Business “for years,” he was not indigent
in 1996, 1997 or in 2000, when he repeatedly swore under oath that he had no
47
money or other assets to retain counsel. In short, if the statements attributed to
Loynaz by The Miami Herald are true, Loynaz perjured himself both in federal
court and before the Referee. He is neither “credible” nor “vulnerable” but, as
Respondent has consistently claimed, a predator who made false accusations
against Respondent for a variety of selfish motives.
The Successor Referee should have conducted an evidentiary hearing on the
revelations contained in The Miami Herald article. See generally Swafford v. State,
679 So.2d 736 (Fla. 1996) (relinquishing jurisdiction for 90 days for Circuit Court
to conduct evidentiary hearing on newly discovered evidence claims in criminal
case); Island Transp v. Ilman, 669 So.2d 298 (Fla. 3d DCA 1996) (reversing denial
of Rule 1.540 motion for evidentiary hearing); Ross v. Bandi, 566 So.2d 55 (Fla 4th
DCA 1990) (same); Wiley v. Wiley, 546 So.2d 1149 (Fla. 4th DCA 1989) (same).
The revelations by The Miami Herald constitute a colorable showing of
misconduct, sufficient to require such a hearing. Evidentiary hearings are
frequently held on newly discovered claims based on media reports. See, e.g.,
United States v. Fernandez, 136 F.3d 1434, 1439 (11th Cir. 1998) (reversing denial
of motion for new trial for evidentiary hearing based entirely on newspaper articles
and a transcript of a “60 Minutes” broadcast); United States v. Martinez, 14 F.3d
543, 550-51 (llth Cir. 1994) (reversing for denial of motion for new trial following
48
evidentiary hearing which was convened, in part, following media reports of juror
misconduct); United States v. Posner, 644 F. Supp. 885, 889 (S.D. Fla. 1986)
(newspapers quoting juror’s comments sufficient to prompt court to conduct sua
sponte inquiry: court thereafter grants motion for new trial), aff’d, 828 F.2d 773
(11th Cir. 1987), cert. denied, 485 U.S. 935 (1988).
The deposition testimony of Manuel Fernandez also contradicts the
sworn testimony of Nelson Loynaz before the Referee. Loynaz testified below that
he purchased the four cars at issue herein for $150,000 in cash from someone
named “Horacio Sardinas.” See Hearing Testimony, December 15, 2000, at p.62.
In his deposition, Mr. Fernandez testified that he sold the four cars to Loynaz for a
total only $30,000. Mr. Fernandez further testified that he had previously told the
Respondent—falsely as it turned out—that he (Fernandez) still owned the cars and
that Loynaz did not. Id. at pp. 18-20. Thus, Mr. Fernandez’ deposition testimony is
both completely inconsistent with Loynaz’ testimony before the Referee
(concerning how he acquired the vehicles and their value) and consistent with
Respondent’s testimony concerning the actual owner of the vehicles.
CONCLUSION
Based upon the above argument and citations of authorities the Court should
remand the case for a new trial.
49
Respectfully submitted,
__________________________ ALAN IRA KARTEN, pro se 1888 N.W. 7th Street Miami, Florida 33125 Tel: (305) 541-6300 Fax: 305-643-3334
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true and correct copy of the foregoing brief
was mailed this ____ day of ______________ 2005 to:
Randi Klayman Lazarus Staff Counsel The Florida Bar The Florida Bar Rivergate Plaza 650 Apalachee Parkway Suite M-100 Tallahassee, Florida 32399-2300 444 Brickell Avenue Miami, Florida 33131 __________________________ ALAN IRA KARTEN
CERTIFICATE OF COMPLIANCE
I HEREBY CERTIFY that the foregoing Brief was prepared in Times New Roman 14-point font. __________________________
ALAN IRA KARTEN
50