In a potentially explosive document filed Monday, the attorneys for PA Child Care and Western PA Child Care claim that money paid to two former Luzerne County, Pa., judges was not a "kids for cash" arrangement, but was part of a corrupt courthouse system that included fixing civil cases.
The attorneys, who also represent Gregory Zappala and the juvenile detention facilities, allege that former Luzerne County President Judges Mark A. Ciavarella Jr. and Michael T. Conahan Jr. were paid more than $2.6 million for "favorable panels or results in automobile arbitration cases or other civil cases, and not for adjudication and commitment of the delinquents."
The child-care provider defendants in the case deny all knowledge of any alleged kickback scheme.
They claimed the "information relevant to this belief … is in the control of" the U.S. attorney for the Middle District of Pennsylvania. They also claimed that they could not conduct thorough discovery while the investigation is ongoing and that "if the outcome of the investigations is as provider defendants expects, all discovery will be unnecessary."
The allegations represent a clear departure from those made by federal authorities in criminal cases.
PA Child Care and Western PA Child Care, though, claim their allegations can be backed by Luzerne County Common Pleas Court judges and attorneys who have received target letters from federal investigators.
The attorneys for the juvenile detention centers, Bernard M. Schneider of Brucker Schneider & Porter in Pittsburgh and Jonathan Vipond III of Buchanan Ingersoll & Rooney in Harrisburg, Pa., did not provide the names of attorneys under investigation or specific judges.
The new allegations are found in a 32-page case management plan filed by plaintiffs in a series of civil cases against Ciavarella, Conahan, former PA Child Care co-owner Robert Powell, builder Robert K. Mericle, Zappala and several others.
Schneider did not return a reporter's phone call. Conahan's attorney, Philip Gelso, said he had no comment. Ciavarella, who is representing himself in the civil case, did not return a reporter's phone call.
When asked about the assertions, Martin C. Carlson, the acting U.S. attorney for the Middle District of Pennsylvania, said, "I wouldn't comment on speculative claims in civil litigation."
Marsha Levick of the Juvenile Law Center, which represents some of the plaintiffs, called the defense "ludicrous."
"I was surprised they put that in a public document," Levick said. "I wonder what the U.S. attorney will do with that."
She said that none of the assertions in the case management document, including that the payments were allegedly for fixing arbitration cases, "diminish our claims in any way."
"I don't think this changes the story, it just adds another layer," she said. "The owner was in it for the money. The only way it made money was if the court kept the facility full."
One of Powell's attorneys, Mark Sheppard of Montgomery McCracken Walker & Rhoads, declined to comment.
A review of Luzerne County's UM/UIM arbitration cases subpoenaed by federal investigators showed Powell's firm was involved in only one case in which a judge appointed a neutral arbitrator since 2004.
The case, Kowalchick v. State Farm Insurance, was filed in 2005. Aaron Decker, an attorney at Powell's firm, was the plaintiffs attorney in the case. A record of who was appointed as a neutral arbitrator was not immediately available. Conahan was the judge in the case.
However, an investigation by The Legal Intelligencer also shows Powell and Jane S. Sebelin, an attorney at his firm, were involved in a UM/UIM arbitration case in 2004. In that case, Ciavarella appointed Mark Bufalino, an attorney at Elliott Greenleaf, as a neutral arbitrator.
There is no indication that any of the parties involved did anything wrong in those cases.
Earlier this year, federal investigators charged Ciavarella and Conahan with honest services wire fraud and conspiracy to defraud the United States. The judges have conditionally agreed to serve 87 months in federal prison.
The government has held the position that the $2.6 million influenced the judges' decisions to send children to PA Child Care, something Ciavarella and Conahan both deny.
In February, the Juvenile Law Center and other plaintiffs attorneys began filing class action suits against the defendants, questioning whether the judges engaged in a quid pro quo with Powell, Mericle and others related to the juvenile detention centers. In one suit, the Juvenile Law Center raised allegations of racketeering activity and violations of the Fifth, Sixth and 14th amendments.
"Instead of due process, thousands of these children, among the most vulnerable members of our society, were victims of a wave of unprecedented lawlessness that within minutes of their court appearances, swept them away in handcuffs and shackles and placed them in detention or other residential facilities for months for infractions as trivial as shoplifting a four dollar jar of nutmeg or taking change from unlocked cars," the JLC's complaint charges. "The abuse and trauma these children suffered at the hands of defendants has dramatically changed the trajectory of many of their lives."
Ciavarella replied to the complaint in March, arguing judicial immunity. Conahan has likewise claimed he is immune from liability.
Most of the joint case management plan filed Monday outlined the issues in the case, each side's positions and how the case should move forward.