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By suing the National Association of Securities Dealers for $100 million in damages resulting from a perjury conviction and disbarment, an ex-lawyer has surpassed a previous bar for “courtroom chutzpah,” a Southern District of New York judge said in dismissing the suit. Jamie Scher was convicted of perjury in 2002 for her role in attempting to thwart a 1998 NASD investigation into the position her father held at Renaissance Financial Securities Corp., a Long Island brokerage. Her father had been banned for life from the securities industry in 1973. At the time, Scher was a broker and general counsel at Renaissance, where her father and brother — who both were convicted of perjury as well — held senior positions. In her suit, Scher claimed that, in taking her sworn testimony in the presence of counsel, the NASD failed to warn her that lying in the interview could result in criminal perjury charges. They warned her only of “possible sanctions” like censure or fines. She argued that the failure to warn her of possible criminal charges violated her Fifth Amendment right against self-incrimination as well as her right to due process. But Southern District Judge Michael Mukasey said such claims were of “gossamer durability,” noting that she was an experienced attorney accompanied by experienced defense counsel, a former NASD lawyer. “Plaintiff’s contention here that she should have been warned that perjury is a crime, even though she had been placed under oath — and that she should now be compensated to the extent of $100 million or more in damages for this supposed deprivation of her constitutional rights — is without any merit whatsoever,” he wrote in Scher v. NASD, 04 Civ. 6169. Mukasey said the suit was barred in any case because the NASD, as a self-regulating organization, enjoyed absolute immunity for actions taken within the scope of its regulatory duties. But he also rejected the argument that the NASD’s conduct constituted state action triggering Fifth Amendment and due process protections. He noted that other New York federal courts considering the issue had consistently held that the NASD as well as the New York Stock Exchange could have immunity in conducting their public, regulatory functions while remaining private actors for other purposes. Mukasey opened his 16-page decision by comparing Scher to Seymour Thaler, a former state senator and judicial candidate who was convicted in 1972 of trafficking in stolen bearer bonds. Thaler subsequently sued the bank that issued the bonds for $52 million, claiming his disbarment, imprisonment and public scorn resulted from the bank’s failure to inform his co-conspirator that the bonds were stolen when he sought to cash them. Mukasey cited the unreported 1974 decision of the judge in that case, Jon Newman, who now sits on the 2nd U.S. Circuit Court of Appeals. Newman, then a federal judge in Connecticut, wrote: “When the apocryphal child murdered his parents and then sought mercy as an orphan, he set a standard for courtroom chutzpah that has not been rivaled until the filing of this lawsuit.” Mukasey said Scher’s chutzpah surpassed even that of Thaler’s, noting that the latter had at least “been toppled from a far loftier perch than in-house counsel to a securities firm.” Scher appeared pro se. Gibson, Dunn & Crutcher represented the NASD.

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