Federal Court Has Jurisdiction Over Paskenta Band of Nomlaki Indians Lawsuit Against Former Tribal Officials, Senior Employees For Defrauding Tribe of Millions

(CORNING, Calif. – Aug. 14, 2015) A federal judge ruled today that the U.S. District Court, Eastern District of California, has subject matter jurisdiction over a lawsuit filed by the Paskenta Band of Nomlaki Indians under the federal Racketeer Influence and Corruption (RICO) Act and other state and federal laws against former Tribal officials and senior employees accused of defrauding the Tribe of tens of millions of dollars. The court rejected claims by defendants that the Tribe’s lawsuit is an intra-tribal dispute and therefore the Court had no jurisdiction to hear any of the Tribe’s claims.

“We are gratified by the Court’s decision. The Tribe brought this action to hold responsible a group of individuals who, for well over a decade, conspired to steal tens of millions of dollars from the Tribe,” the Paskenta Band of the Nomlaki Indians Tribal Council said in a statement. “That stolen money, much of which the Ringleaders used to pay for a lifestyle of private jet travel, sports cars, and luxury homes, could and should have been used to improve the welfare of the Tribe’s members. The Court’s decision today makes clear that these individuals and others who benefited from their scheme will be held responsible for the harms they caused.” 

The Tribe’s co-lead counsel Stuart Gross, of Gross Law P.C., added, “With a single sentence, the Court rejected the argument that this case is an intra-tribal dispute over tribal membership and governance over which the Court lacks jurisdiction. The decision sends a clear message that tribal officials who steal from the tribes they are supposed to serve can and will be held responsible for their actions in federal courts. The defendants misleadingly defended their conspiracy to defraud the Tribe through arguing the federal courts had no power to review actions that violate federal and Tribal law. The opposite is true; and we are pleased the Court rejected defendants' attempt to avoid liability on this basis.”

In another significant win for the Plaintiffs, U.S. District Judge Garland E. Burrell, Jr., also denied the defendants’ attempt to dismiss the Tribe’s restitution claims, including those filed against Abettor Defendants Umpqua Bank and Umpqua Holdings Corp., Cornerstone Community Bank and Cornerstone Community Bancorp, Associated Pension Consultants and Patriot Gold & Silver Exchange, as well as others that allegedly assisted in the theft of Tribal funds. In addition, the Court provided the Tribe with an opportunity to amend its claims against the Abettor Defendants.

“The Court’s decision affirms the Tribe’s ability to pursue claims against all of the twenty-plus named defendants. This includes those who alleged to have directly participated in the RICO conspiracy, as well as those who assisted and benefited from it. To the extent the Court has asked the Tribe to amplify its allegations concerning some of those claims, we intend to do so,” said the Tribe’s co-counsel Andrew M. Purdy of the Joseph Saveri Law Firm, Inc.  

In March 2015, the Tribe filed the lawsuit in federal court charging its former treasurer and three former senior officials with defrauding the Tribe of tens of millions of dollars in Tribal moneys. . The 200-plus page complaint alleges in detail that these four individuals used vote-rigging, bribery, and extortion to take control of the Tribe and its principal non-casino business entity during this far-reaching, decade-long scheme.

Also named in the lawsuit are individuals, including several family members of the four defendants, and businesses that participated in the conspiracy and/or aided and abetted the illegal activity. These include Umpqua Bank, Umpqua Holdings Corp., Cornerstone Community Bank, and Cornerstone Community Bancorp—all of which allegedly assisted the Ringleaders in their theft of Tribal moneys on deposit—as well as Garth Moore Insurance & Financial Services, Associated Pension Consultants, Inc., Haness & Associates, LLC, and their principals, who are alleged to have facilitated conversion of millions of dollars through unauthorized retirement compensation schemes. Additionally, Patriot Gold & Silver Exchange and its owner, Norman R. Ryan, are alleged to have substantially assisted defendant John Crosby in converting approximately $160,000 of the Tribe’s money through purchases of gold.

For more information about the lawsuit, Paskenta Band of Nomlaki Indians and Paskenta Enterprises Corporation v. Ines Crosby, John Crosby, Leslie Lohse, Larry Lohse et. al, contact Stuart G. Gross, of Gross Law P.C., at (415) 671-4628, or Andrew M. Purdy of the Joseph Saveri Law Firm, Inc., at (415) 500-6800.

A copy of the Order can be found here: [101] PBNI v. Crosby - Order re MTDs.pdf

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Court Rejects PG&E’s Effort To Avoid Claims For Massive Contamination Of SF Bay and SF Neighborhoods

SAN FRANCISCO, February 26, 2015 – Judge William Orrick of Northern District of California federal court in San Francisco Bay, today, rejected efforts by PG&E to avoid claims arising out of massive contamination of the Marina and Fisherman’s Wharf neighborhoods and nearby waters of the San Francisco Bay. As alleged in the Complaint, PG&E has known about the contamination since at least the 1970’s; however, it not only has failed to clean up the contamination, it has vigorously resisted conducting the testing necessary to determine its full extent.

PG&E argued that claims brought by the San Francisco Herring Association, an association of commercial herring fishermen, and a Marina property owner under the federal environmental laws—the Clean Water Act and Resource Conservation and Recovery Act—failed as a matter of law and that the plaintiffs lacked the standing to pursue the claims. The Court rejected each of several arguments raised by PG&E, including: that contamination left behind 100 years ago could not be the basis for a Clean Water Act claim now; that contamination which migrates to navigable water through groundwater could not form the basis for a Clean Water Act claim; and that PG&E could avoid claims under the Resource Conservation and Recovery Act on the ground that a regulatory agency had approved of a remediation plan alleged to be inadequate.

The contamination at issue is the result of PG&E’s operation in the late 1800’s and early 1900’s of what are known as “manufactured gas plants” or “MGPs” at two locations in the present day Marina neighborhood and at one location in the present day Fisherman’s Wharf neighborhood. MGPs were refineries that turned coal, oil, and combinations thereof into gas that was pumped to residences in their vicinity. The process created large amounts of highly toxic waste, including waste that contained large concentrations of chemicals known as poly-aromatic hydrocarbons or “PAHs.” PAHs are carcinogens and are highly toxic to marine life, especially herring in their early life stages. They are also extremely persistent, able to remain highly toxic for hundreds of years after being released into the environment.

“This case seeks something very simple but very important: identification and cleanup of the toxic contamination left behind by PG&E,” said Stuart G. Gross of Gross Law, P.C., counsel for the plaintiffs in the lawsuit. “We are gratified that the Court agreed that the plaintiffs’ claims have merit. We look forward to pursuing their successful resolution.”

The lawsuit is titled, San Francisco Herring Association v. PG&E, No. 14-4393 (N.D. Cal.).

A copy of the Order is available here: [44] SFHA v. PGE Order Denying MTD.pdf

A copy of the Complaint is available here: San Francisco Herring Association v. PG&E, No. 14-4393 (N.D.Cal.)

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National Fisherman

Caltrans Agrees to Reevaluate Impacts of Del Norte Highway Project on Threatened Salmon

CRESCENT CITY, July 11, 2014— In response to a lawsuit filed by Gross Law and co-counsel on behalf of conservation groups, Caltrans has agreed to reassess impacts of a controversial highway-widening project in Del Norte County on protected salmon and their habitat along the wild and scenic Smith River. A settlement agreement will keep in place a court-ordered halt of construction work until Caltrans completes consultation with the National Marine Fisheries Service under the Endangered Species Act and Magnuson-Stevens Fisheries Conservation Act.

Caltrans is attempting to widen narrow sections of highways 197 and 199 along the Smith River in California’s remote Del Norte County to provide access for oversized trucks. Construction would increase erosion and delivery of sediment into the Middle Fork Smith River, harming habitat for threatened coho salmon runs that already face a high risk of extinction. The project would undermine public safety by increasing heavy and oversized truck use on narrow roadways along the Smith River Canyon; it would hurt tourism and local residents.

 Gross Law, with co-counsel, filed lawsuits in federal and state court in 2013, on behalf of Friends of Del Norte, the Center for Biological Diversity, the Environmental Protection Information Center, and WW II combat fighter pilot veteran and local resident Ted Souza, challenging the review of the project’s environmental impacts by Caltrans and the National Marine Fisheries Service (“NMFS”). Caltrans had slated major earthmoving and construction work to begin this month.

Judge James Donato of Northern District Court issued a preliminary injunction in early May stopping Caltrans from doing any further work, citing substantial violations of the Endangered Species Act, a “haphazard” consultation process with the federal fisheries agency, and the potential for irreparable harm to the Smith River and salmon habitat. The court characterized both agencies’ biological assessment documents for the project as “contradictory and unclear.”

As part of the new settlement, Caltrans has now reinitiated consultation with the National Marine Fisheries Service to properly analyze whether the project would jeopardize threatened coho salmon and their critical habitat in the Smith River or adversely affect the essential fish habitat of all salmon species in the river. The conservation groups retain the right to challenge any further agency decisions or environmental documents for the project.

Stipulation and Order for a Dismissal without Prejudice - Souza v. Caltrans, No. 13-4407-JD (N.D. Cal).pdf

Order Granting Motion for Preliminary Injunction - Souza v. Caltrans, No. 13-4407-JD (N.D. Cal.).pdf

First Amended Complaint - Souza v. Caltrans, No. 13-4407-JD (N.D. Cal.).pdf

First Amended Verified Petition - Friends of Del Norte v. Caltrans, No. CVPT 13-1156 (Sup. Crt. Del Norte. Cnty.).pdf

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California Court of Appeal Overturns Lower Court Order, Finding Caltrans Failed to Consider Project’s Impact on the Old-Growth Redwoods of Richardson Grove

SAN FRANCISCO, January 30, 2014 — The California Court of Appeal today granted an appeal filed by Gross Law and co-counsel on behalf of environmental organizations and community members and ordered Caltrans to reevaluate the environmental impacts of a proposed highway-widening project in Humboldt County that would harm old-growth redwood trees in Richardson Grove State Park. The appeals court unanimously found that Caltrans failed to follow California environmental law in assessing impacts to the redwoods, many of which are thousands of years old. Caltrans’ project—intended to allow bigger trucks to travel Highway 101 through the park—would require excavation, fill, and paving within the fragile root zones of numerous old growth trees.

In its opinion, the court found that by failing to “separately identify and analyze the significance of the impacts to the root zones of old growth redwood trees” Caltrans had “subvert[ed] the purposes of CEQA [(California Environmental Quality Act)].” Accordingly, the court overturned the lower court’s order approving Caltrans’ analysis and directed it to enter judgment, requiring Caltrans to re-examine the proposed project’s potential impact on Richardson Grove’s old-growth redwoods.

In the spring of 2012, in a separate related lawsuit filed in federal court by Gross Law and co-counsel on behalf of substantially the same parties, Northern District of California Judge William Alsup ordered Caltrans to redo critical aspects of its environmental analysis of the proposed project’s potential impact on old-growth redwoods, finding the analysis in violation of federal environmental laws and “based off of false data.”

In 2011, Judge Alsup had preliminarily enjoined all work on the proposed project. The work remains enjoined.

The California State court lawsuit is captioned Lotus, et al. v. Caltrans, et al., No. 110002 (Humb. Cnty. Sup. Crt.), A137145 (1st App. Div.).

The lawsuit is captioned Bair et al. v. Caltrans et al., No. 10-04360-WHA (N.D. Cal.).

Order Granting Motion for Preliminary Injunction - Bair et al. v. Caltrans et. al., No. 10-04360-WHA (N.D. Cal.).pdf

Order Granting Motion for Summary Judgement - Bair et al. v. Caltrans et al., No. 10-04360-WHA (N.D. Cal.).pdf

Decision Granting Appeal and Ordering Entry of Judgment in Plaintiffs' Favor - Lotus, et al. v. Caltrans, et al., A137145 (1st App. Div.).pdf