Friday, July 11, 2014

Court: Powell must may back $6 million in loans

September 09. 2013 11:52PM
Times Leader staff

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A three-judge panel of the state Superior Court has ruled that the law firm run by Attorney Robert Powell, a key figure in the scandal that sent two Luzerne County judges to jail on corruption charges, must pay more that $6 million in loans and attorney fees in defaulted loans and attorney fees owed for two businesses Powell ran.

In three separately but similarly worded opinions penned by Senior Judge Robert E. Colville, the panel unanimously rejected appeals by the Powell Law Group regarding a lower court decision about the loans, which included a 2003 loan to his firm Big Kahuna totaling $1.35 million, a 2004 loan to Big Kahuna for $225,000, and a 2005 loan to his development company, W-Cat, initially for $2.5 million by extended with two separate $1 million lines of credit.

Powell’s firm had contended the attorney fees, totaling $635,743 for the three loans, were “excessive” and the loan documents lacked proper signatures and initials. Colville’s opinion called the the appeals “poorly crafted arguments.”

Powell was co-owner of two private juvenile detention and treatment centers at the heart of the scandal that brought down former county judges Michael Conahan and Mark Ciavarella, both currently serving long prison sentences. During Ciavarella’s trial, Powell testified the two judges essentially strong-armed him into making recurring payments in exchange for them assuring juveniles deemed delinquent in county court would be sent to the facilities.

The scandal became known as “kids for cash,” a label Ciavarella has relentlessly rejected, insisting that, while he did get money from Powell and facility builder Robert Mericle, it was not in exchange for sending youths to the facilities.

Powell was sentenced to 18 months in prison after pleading guilty in July 2009 to charges of failing to report a crime related to those payments.

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