A municipal judge charged with breaching his fiduciary duty to investors in his business dealings has settled a lawsuit that is central to a judicial ethics case against him.
Harold P. Cook III had appealed the $99,400 judgment against him, Sachs v. Jefferson Loan Co., HUD-L-1414-07.
But on May 25, the Appellate Division dismissed the appeal on the parties’ stipulation, stating “this matter has been amicably adjusted.”
The settlement’s terms are unknown. Cook did not return a call. His lawyer, Joseph Cerra of Forman Holt Eliades & Ravin in Paramus, declines comment, as do plaintiff Charles Sachs and his lawyer, Michael Miller of Newark’s Tompkins McGuire Wachenfeld & Barry.
Sachs, a retired solo from Bayonne, was a lawyer and investor in Jefferson Loan Co., which made automobile and other consumer loans, before Cook acquired a 60 percent interest in the company and became its president.
Sachs alleged in his suit that Cook and co-defendant Sean Caposella — owner of the other 40 percent — failed to advise him and other debenture holders about the company’s deteriorating finances between 2002 and 2007, thereby inducing them to keep renewing the debentures rather than cashing them in.
“He has done people out of about $6 million,” Sachs said in an interview last July, adding that “anyone who conducts himself like Mr. Cook did is a disgrace to the profession.”
The ethics case, In the Matter of Harold P. Cook III, ACJC 2009-301, was filed in May 2011, when Cook was municipal judge for Haledon, North Haledon, Ringwood and Wanaque and counsel to the Wyckoff Zoning Board and the Elmwood Park Planning Board.
His extensive business interests were what got Cook in ethics trouble. The case began with a grievance filed by developer Joseph F. Spiezio III, a one-time business partner in a Yonkers redevelopment project who spent years litigating with Cook in New York after their relationship soured.
The Advisory Committee on Judicial Ethics accused Cook of compromising his judicial office through his private business dealings — including the now-defunct Jefferson Loan Co. — which resulted in more than 40 lawsuits and more than $2.7 million in judgments against him or his entities, with creditors seeking to collect by garnishing his judicial wages.
The suits alleged breach of fiduciary duty, legal malpractice and default on more than $20 million worth of promissory notes and personal guarantees, among other claims.
The ACJC further charged that Cook tried to thwart creditors by making fraudulent property transfers to family members and entities he controlled and by failing to answer creditors’ information subpoenas, cooperate with opposing counsel, return phone calls and respond to discovery requests.
At one point, a judge even ordered an arrest warrant issued against Cook for failing to comply with postjudgment discovery in the Sachs case. The incident is not mentioned in the ACJC complaint because it occurred in June 2011, after the ethics case was commenced.
One of Cook’s alleged infractions was failing to report any of the 43 lawsuits in which he was involved, contrary to Administrative Office of the Courts Directive No. 4-81.
Cook also stands accused of making a total of $5,660 in political contributions to state legislators and to county and local officials between 2002 and 2009, either personally or through his business entities and his law firm, Perconti & Cook, which has since dissolved.
The ACJC further alleged that the firm defended Paterson police officers in civil and criminal cases, even though Cook’s status as a judge in Passaic County should have precluded the representation.
Cook, in his answer to the charges last July 11, denied any wrongdoing and blamed his troubles on the economic downturn and on an unnamed bankrupt business partner who was a co-guarantor on multiple loans.
The ACJC has not yet scheduled a hearing, says Cook’s attorney in the matter, Bloomfield solo Salvatore Alfano.
Shortly after the ethics case was filed, Cook took a leave of absence from his public jobs. Judges from other Passaic County municipalities filled in for him, including John Meola, Debbie Irwin and Cook’s former law partner, Joseph Perconti.
In the interim, Cook has lost his judgeships in two of the four towns. Haledon replaced him with John Segreto Jr., a former municipal prosecutor and Ringwood hired Perconti, now a Totowa solo. Perconti is also the municipal judge for Prospect Park and West Milford.
Cook is still a judge in North Haledon, where Meola is filling in, and in Wanaque, where Perconti is the acting judge.
Perconti, who was not just Cook’s law partner but his business partner as well, filed for bankruptcy in June 2011. Court papers disclosed his shared interests in five real estate ventures with Cook and others, as well as a 50-50 share in a tanning salon with Cook’s daughter. On Feb. 16, U.S. Bankruptcy Judge Novalyn Winfield in Newark confirmed Perconti’s Chapter 11 plan, which gave up his interests in those entities.
A pending motion filed by Perconti on April 17 in the bankruptcy, In re Perconti, No. 11-28397, seeks to expunge more than $5 million in claims by Cook and other business partners on various grounds.
Perconti declines comment.