A recent report has raised questions about a Blank Rome lawyer’s work as deputy special master for the September 11th Victim Compensation Fund, through which she appears to have approved millions of dollars’ worth of contracts between her own law firm and the fund.
The U.S. Department of Justice Office of the Inspector General’s audit of the fund, released last week, pointed out a potential conflict of interest created through Deborah Greenspan‘s dual role as a firm partner and deputy special master. Greenspan was the deputy special master for the fund from 2011 to 2016. During most of that time she was a partner at Dickstein Shapiro, but she joined Blank Rome in 2016 when the firm acquired more than 100 lawyers from the now-shuttered Dickstein Shapiro.
Greenspan had previously served as deputy special master for the September 11th Victim Compensation Fund of 2001. She was appointed to the same position on the new fund shortly after Sheila Birnbaum, a partner at Quinn Emanuel Urquhart & Sullivan, became special master. Greenspan left the fund while the audit was ongoing.
During that five-year time period, the report said, Greenspan’s firms were issued more than $3.6 million worth of noncompetitive contracts. According to the OIG, the fund did not sufficiently document the rationale for awarding them without competition.
The report said Greenspan not only dictated the requirements of contracts, but signed them on her firms’ behalf.
The fund paid more than $3.4 million to Dickstein Shapiro for legal services between August 2011 and February 2016, the report said, and more than $161,000 to Blank Rome between March and June 2016. Greenspan said her firms charged a reduced hourly rate for the work, according to the OIG.
“We believe Greenspan should have proactively excluded herself from negotiating these contracts because of the resulting financial benefit to her law firms where she remained a partner, and that the Civil Division should have required someone else to represent the government’s interest in establishing the contracts,” the report said.
According to the report, Greenspan consulted the Justice Management Division’s ethics office about the potential conflict of interest, but there was never a resolution. Greenspan has also said her firms did not make a profit on that work, the report said, but the OIG does not have enough evidence to make sure of that.
“The $3.6 million in revenue that the contracts generated for the law firms and its partners was not insubstantial,” the report said. “Nevertheless, because we were unable to obtain sufficient information to determine the profitability of these contracts for the law firms, we could not ascertain whether Greenspan received any financial compensation as a result of the contracts.”
It was difficult for the auditors to discern whether Greenspan received any share of profits attributable to the victims’ fund, the OIG report said. When the OIG tried to get information about Greenspan’s shares during her years as a deputy special master, they were told that information was unavailable, the report said, because Dickstein Shapiro’s share information was lost after the firm closed. According to the report, Blank Rome said neither firm made any profit on the contracted work, because it was done at such a low rate.
The OIG report also said Greenspan and Birnbaum used their law firm email accounts to receive personally identifying information about people looking to claim money from the fund. But once the OIG brought that to their attention, the report said, the law firms made sure the information had been kept secure, and deleted it from their servers.
In a statement Tuesday, a Blank Rome spokeswoman said Greenspan “‘drew upon the assistance of other lawyers in her law firms upon the Justice Department’s request and on below-market terms and related conditions specifically dictated and approved by the Justice Department.’”
According to the firm, Greenspan worked without compensation for the fund, and the firm charged rates that were less than 20 percent of Blank Rome’s standard hourly rate. That amount was based on what it would have cost for government lawyers to do the work.
“Greenspan’s compensation at Blank Rome has been entirely unrelated to any fees received for the work of other firm lawyers for the fund,” the firm said. “We understand that the same was true at her former firm, Dickstein Shapiro. As the report indicates, the Dickstein Shapiro firm did not consider that it earned any profits from the VCF work and the same is true for Blank Rome.”
The Blank Rome spokeswoman also said the firm never held documents belonging to the fund. The only instance in which Greenspan received personally identifying information on her law firm email was at Dickstein Shapiro “as a result of an error by a DOJ employee failing to redact such information,” she said.