Jody Kriss. (East River Partners)
A onetime informant against the mob claims his former Ivy League-educated business partner has attempted to shake him down along with several prominent law firms, businessman Donald Trump and even a federal prosecutor.
Salvatore Lauria, who turned against alleged Mafioso after he was nabbed in a securities fraud in the 1990s, claims in a complaint filed in Manhattan Supreme Court that Jody Kriss, his onetime partner in the Bayrock Group real estate development firm, is engaged in a “billion-dollar shakedown.” Lauria is represented by Nader Mobargha and Michael Beys of Beys Stein Mobargha & Berland, which includes itself as one of the victims.
The characters and entities on the alleged victim list also include Donald and Ivanka Trump, billionaire Tamir Sapir, the accounting firm of Salomon & Co., and the law firms of Nixon Peabody, Morgan Lewis & Bockius, Roberts & Holland, Duval & Stachenfeld and Satterlee Stephens Burke & Burke.
Lauria claims that Kriss and his “rogue lawyers” —Frederick Oberlander of Long Island and Richard Lerner, a former partner at Wilson, Elser, Moskowitz, Edelman & Dicker—leaked sealed information about Lauria’s informant days. As a result, Lauria contends, “members of the mafia” tracked him down at a restaurant in Brooklyn in 2012 where he was having lunch with business colleagues.
“Undaunted by the public scene, the mafia member beat Lauria in broad daylight, menacingly telling Lauria, ‘[Y]ou’re dead. I am going to kill you…You’re a rat. I did two years because of you,’” according to the March 16 complaint. “Lauria knew how serious the threat was. He had heard that the very same family of this mafia member has a long history of murder and violence.”
Although Lauria contends that leaks by the defendant and his attorneys led to the beating and threat, court records show that the case file related to his 1998 conviction, including vague mention of his cooperation, has been unsealed since 2009, long before the underlying dispute with Kriss.Additionally, when Lauria was sentenced in 2004, there were several references to threats, according to a transcript of the proceeding.
Lerner and Oberlander said in a statement yesterday that Lauria in his 2003 book, “The Scorpion and the Frog,” revealed that he had been an informant. They denied that Kriss bore any responsibility for outing Lauria as a snitch.
“In a criminal case, a defendant has a right to be told who the government will be calling to testify against him,” Lerner and Oberlander said. “Mr. Lauria’s co-conspirators were told as early as 2001 that he was an informant…It is not credible— particularly coming from a convicted RICO fraudfeasor—that information allegedly disclosed by Mr. Kriss in 2012 led to Mr. Lauria getting beat up.”
Kriss, in a statement, characterized the lawsuit as “the latest in a string of increasingly desperate attempts” to pressure me and others to drop lawsuits stemming from business transactions. “None of the bullying tactics will have any effect,” Kriss said.
Lauria v. Kriss, 152324/2014, is rooted in a bitter dispute between former officials at Bayrock, a real estate investment and development company that was involved in a number of Trump projects, including the Trump Soho in Manhattan and the Trump International Hotel & Tower in Fort Lauderdale.
The underlying action pending in the Southern District, Kriss v. Bayrock, 10-cv-3959, alleges that Bayrock backers were duped into investing in a company run by felons, including Lauria and Felix Sater.
In the course of Kriss v. Bayrock, Sater was identified as the “John Doe” who was involved in a $40 million 1998 securities fraud and worked a plea bargain by assisting federal investigators. Some documents identifying Sater were inadvertently posted on the court website and others were leaked. Kriss’ attorneys, Oberlander and Lerner, remain the target of a criminal contempt investigation in the Northern District and a civil contempt motion pending in the Eastern District.
Lauria’s complaint compares Kriss to Tom Hagen, the crime family consigliore played by Robert Duvall in the “Godfather” films.
“[K]riss is a predator with a veneer of legitimacy, a wolf masquerading as a shepherd, a Tom Hagen,” according to the complaint filed by Beys and Mobargha.”His use and abuse of the judicial system to steal, pressure and extort Lauria and the other defendants show that mobsters and extortionists do not always pack a gun, carry a bat, or threaten physical violence. Sometimes they wear suits and have fancy degrees from Ivy-league schools like Wharton.”
The complaint portrays Kriss, a graduate of the University of Pennsylvania’s Wharton School, as the Bayrock “front man,” the “squeaky-clean, pedigreed executive” who would function as the public face of the company. Lauria, on the other hand, had a criminal record which, if disclosed, “would bring bad publicity to Bayrock’s real estate projects throughout the country, scare off investors and banks, and hamper its fund-raising abilities,” according to the complaint.
“To investors, it was Kriss who was in charge, not the former convicted criminals, who actually operated and managed the company,” the complaint alleges.
Lauria claims that Kriss was “intrigued” by his criminal history, routinely asked to see his ankle monitor, courted Russian and Turkish mobsters and became known in the office as “vor-ton,” a play on words reflecting his alma mater and a Slavic phrase for thief. But ultimately, Kriss “turned sour on the convicted felons for which he was fronting,” especially after Lauria earned a $2.5 million commission for persuading an Icelandic company to invest $85 million in Bayrock, the suit alleges.
“Kriss was incensed that a convicted criminal like Lauria was to receive such a large commission, while he, the self-proclaimed founder, front, and high-level executive of Bayrock with an Ivy League degree, was only to receive his relatively modest salary,” according to the complaint. “So Kriss embarked on a crusade to extort an additional bonus from Bayrock for the transaction. This extortion included threats to publicly disclose the criminal history and federal cooperation of Lauria and other employees.”
Kriss went on to accuse Lauria, other Bayrock principals, accountants, several law firms and other entities of engaging in a massive RICO conspiracy. He also attempted to pull in Eastern District Assistant U.S. Attorney Todd Kaminsky as a conspirator, but the prosecutor has since been dismissed from the case.
“Kriss knew … that he could exponentially multiply the price of his lawsuit by naming prestigious, white shoe law firms, their lawyers individually—and more importantly, their insurance carriers—as defendants,” the complaint alleges. “He figured that, to protect their reputation, these defendants would stroke a quick check just to disassociate themselves from Bayrock’s convicted criminals and their sensational pasts.”
The complaint describes the claims against the Trumps, who are no longer in the case, as “another good old-fashioned shakedown of some famous wealthy people who might have something to lose if they were associated with former criminals…For Kriss, filing lawsuits is just an endless game, like putting quarter after quarter in a slot machine in Las Vegas, hoping to hit the jackpot and strike it rich…It is time to hold Jody Kriss, a.k.a., ‘VOR-TON,’ accountable.”
Lauria is seeking $5 million, plus punitive damages and legal fees.
@|John Caher can be reached at email@example.com.