The criminal retrial of two former executives of Dewey & LeBoeuf is scheduled to proceed later this year without the defunct firm’s top partner, Steven Davis, after Davis formally accepted a deferred prosecution agreement Friday morning in Manhattan state court.
Davis, who was chairman of Dewey & LeBoeuf, left the courtroom Monday morning after Acting Supreme Court Justice Robert Stoltz reviewed with him some of the terms of his deal with the Manhattan district attorney’s office. Davis’ lawyers also said he had reached a settlement in a parallel civil suit brought by the U.S. Securities and Exchange Commission.
Under the terms of the DPA, Davis cannot practice law in New York, must appear in court for status conferences when requested and must satisfy the terms of his settlement agreement. After five years, if he has met those terms and has not committed any crimes in New York state, the DA’s office will dismiss the indictment against Davis.
Davis did not admit or deny wrongdoing in the SEC settlement, which prohibits him from acting as an officer or director of a public company and from appearing or practicing before the SEC as an attorney.
Also on Friday, lawyers for former Dewey CFO Joel Sanders and former executive director Stephen DiCarmine hashed out some of the details of their retrial, which is set to begin in September. Sanders and DiCarmine have not accepted plea agreements the DA’s office offered them in December, the lawyers said.
Prosecutors accused all three former Dewey executives of orchestrating a scheme to defraud banks and insurance companies in the run-up to Dewey’s historic collapse in 2012. In October, after a lengthy trial and marathon deliberations, jurors rejected a handful of falsifying business records charges but deadlocked on the more serious charges of scheme to defraud, conspiracy and grand larceny, among others.
In December, prosecutors dropped the remaining falsifying business records charges against the defendants, but the grand larceny, conspiracy and scheme to defraud charges remain.
A former junior manager at Dewey & LeBouef, Zachary Warren, who had his case severed from that of the three executives, will go to trial on March 14. He faces charges of conspiracy and scheme to defraud.
Outside the courtroom on Monday, DiCarmine’s attorney, Bryan Cave partner Austin Campriello, said his client is not any more responsible for what happened at Dewey & LeBoeuf than Davis.
“He’s innocent,” he said, adding that his client would not accept a felony plea.
“There was no distinction in the evidence,” DiCarmine added.
Campriello said he had asked the DA’s office for a deferred prosecution agreement for DiCarmine, and that he had agreed to consider what he said were more onerous conditions, such as 1,000 hours of community service, a seven-year restriction against practicing law and a minor financial penalty. Campriello said the offer was not accepted.
Sanders’ attorney, Andrew Frisch, who runs his own white-collar practice, said he plans to file a motion to dismiss the case against Sanders in furtherance of justice because of the onerous financial conditions the trial has placed on the former CFO.
“Who has the resources to represent themselves against one set of charges like this?” he asked. “No one can afford this, and now you’re asking him to do it twice?”
Elkan Abramowitz, Davis’ counsel and partner at Morvillo Abramowitz Grand Iason & Anello, said after leaving that he and Davis were gratified that the district attorney concluded that on the basis of the evidence, “a deferred prosecution agreement is an appropriate resolution.”
Abramowitz said the restriction in the deferred prosecution agreement means Davis cannot appear in New York court as an attorney, but he still remains a member of the bar in New York. He is not licensed in another state.
The effect of the restriction may be minimal for Davis, since Davis was not a litigator and previously had an energy practice.
Abramowitz said Davis can still advise clients outside New York. “He’s actively looking for opportunity to practice law,” Abramowitz said.
Davis is unemployed and will be heading back to London, where his home is, and will be looking for work. The agreement leaves open the possibility that Davis could one day work for an American law firm in London.
One of the jurors from the criminal trial who participated in the 21-day deliberation session attended the hearing on Monday morning. She said she had been in favor of acquitting all three defendants and wanted to hear what the judge had to say about their case.
“I think they suffered enough,” said the juror, who did not want to be named.