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by Margaret Reuter
In The News: Defrauding the Transit Authority
(Jan '01) The Transit Authority, like the City of New York, conducts its business in a crowded, relatively chaotic, unpredictable world, where injuries are just a fact of life. Each year 2,500 people file claims against the Transit Authority for their injuries on or near the buses and subways, for which the Transit Authority pays out about $40 million a year. Consider the tribulations of a defense lawyer who has to figure out claims determining whether there is legal liability or not. Consider the lawyers' task when victims, prompted by their attorneys, fabricate their stories out of whole cloth, blaming the Transit Authority for their own terrible mistakes. Consider two cases brought by the law firm of Morris J. Eisen P.C., an active personal injury firm, against the Transit Authority
Case 1: Willa Robbins was riding home in the pre-dawn hours one October morning with a co-worker, Wayne Hollingshead on a bus in Queens. The bus pulled over beyond the designated stop, near the ramp for the Cross Island Parkway. Robbins and Hollingshead disembarked. As Robbins crossed the street, she was struck by a hit-and- run driver, suffering severe injuries. The Eisen firm sued the Transit Authority on Robbins behalf. She remembered nothing, and Hollingshead testified that the bus driver specifically signaled to both of them, with a wave of his arm, that is was safe to cross the road. The Transit Authority settled with Robbins for $1 million, $490,000 of which was paid to the Eisen firm. It turned out however, that the bus driver never signaled to Willa or Wayne. One of the Eisen attorneys, after some legal research, concocted the story, and one of the firm's investigators convinced Wayne to fabricate his testimony.
Case 2: Jose Nieves, at the young and fearless age of 9 or 10, was at the Longwood Avenue Subway Station on the "A" train with two friends when he fell onto the tracks. The train severed his arm. The Eisen firm sued on his behalf too. At trial, one of Jose's compatriots, Ronnie Baerga, testified that they were walking between the cars, when the train came to a jolting stop, the safety chains between the cars were missing, and Jose was thrown to the tracks. He testified further that the conductor proceeded to start the train despite frantic shouts from him and their other friends that Jose had fallen to the tracks. The Transit Authority for its part, tried to show that in fact Jose had been trying to board the train by jumping on in between the cars. The jury found for Jose Nieves and awarded him $750,000. It turned out, however, that the Eisen firm's investigator did considerable work to make Jose's story compelling for the jury. He paid Baerga to lie about the series of events that lead to Jose's injuries. He paid another friend, who presumably was less inclined to lie, to disappear. And he coached Nieves' mother to give perjured testimony about Jose's character.
Eisen ran such a racket that US Attorney Andrew Maloney investigated, indicted, waged a four-month trial, and convicted him and six associates and private investigators. The US Attorney's office showed that the Eisen law firm in 24 different law suits pressured accident witnesses to testify falsely, paid individuals to testify falsely that they had witnessed accidents, paid unfavorable witnesses not to testify, and created false photographs, documents and physical evidence of accidents for use before and during trials.
In the category of just desserts, the Transit Authority has now won their suit against Eisen for return of all the ill-gotten gains in the Robbins and Nieves cases. Eisen tried to argue it should not be responsible to return the damages unless the TA showed that there was no other legitimate reason that Robbins and Nieves could have won their cases. Justice Milton Williams, writing for a unanimous five member panel of the First Department has just ruled that the Eisen defendants, Robbins, and Nieves are responsible for repaying all sums fraudulently acquired. The court determined that the federal criminal convictions necessarily demonstrated that the defendants made statements known to be false, intending to induce the Transit Authority to rely upon them. Moreover, the TA's reliance was justified.
Meg Sounds Off:
The Transit Authority lawyers and the lawyers of every large tort defendant face huge dockets of cases, large cases and small cases. They must weigh the agency's duty, whether it failed that duty, whether that was the cause of the victim's injuries, whether other circumstances immunize it from liability, and the strength of the evidence. They work in a world where more things are unknown (and unknowable) than many of us would feel comfortable. And they have to make decisions, with limited knowledge, about whether to pay for the injuries of someone, which are often grave and permanent. Faced with victims like Robbins and Nieves, wouldn't you want to believe their stories? One of the occupational hazards of defense lawyers is cynicism. The patently fraudulent conduct of the Eisen racket only feeds that cynicism.
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