Former attorney and Kids for Cash associate Robert J. Powell’s past business colleagues are trying to freeze the $150 million to $200 million he’s expected to receive from environmental contamination litigation, court paperwork says.
Powell, who lost his home in Mountain Top and now lives in Palm Beach Gardens, Florida, served 18 months in prison for failing to report a crime relating to his kickback payments to former Luzerne County judges Mark Ciavarella and Michael T. Conahan.
Both ex-judges are in federal prison serving lengthy prison sentences.
Gregory R. Zappala, who co-owned two juvenile detention centers with Powell that were involved in the corruption scandal — including the controversial center in Pittston Township — recently joined others in filing a racketeering suit against Powell and other individuals and entities with connections to him.
They include his wife, The Powell Law Group, P.C., and Jill Moran, a former county prothonotary who was a partner with Powell at the law firm.
The racketeering suit filers have asked U.S. District Judge Joy Flowers Conti in Pittsburgh for an expedited hearing, alleging Powell can “dissipate” or “hide” the $150 million to $200 million so the money is not available to cover a racketeering suit award.
Conti on Wednesday scheduled a hearing on the matter Aug. 22.
The court filing says Powell and Moran already obtained and disposed of $3 million in fees paid in the contamination litigation, and an Ohio Court of Common Pleas has set aside another $14 million in the settlement.
It says Powell, Moran and Powell Law have a “history of financial manipulation including manipulation” of the plaintiffs’ books, records and finances.
Powell also uses the name “Robert Kulbacki” as an alias, has formed a Cayman Island company and “was reported to have taken duffle bags of cash” to Costa Rica, the filing said. Powell also is “now making frequent trips to Switzerland,” it says.
The plaintiffs also believe the Powells were attempting to avoid service of court paperwork so they could receive the $150 million to $200 million in legal fees and spend or stash the payments before the court could decide the preliminary injunction motion, the filing said.
Attempts to serve court paperwork on the Powells at their home on July 19 were unsuccessful because a woman who answered the door indicated she was house sitting for the Powells, who were in Europe and would not return until the first week of August, the filing says. The Powells avoided service of the suit until Aug. 4, it says.
The complaint alleges the plaintiffs sustained $95.6 million in damages, which would be tripled to $286.9 million if the racketeering suit is successful.
According to the complaint, the defendants allegedly stole more than $2.9 million from the plaintiffs and used it to pay for the following:
• Cash bribes to Conahan.
• The purchase of a Florida condominium for Conahan and Ciavarella.
• $30,000 for former county judge Michael Toole, who served prison time as part of the corruption probe for receiving a reward for official action and under-reporting his income by $30,000.
• A private jet to fly another former judge to Florida, where he stayed for free at the Florida condominium.
• Alcohol for a private bar located on a floor above the Powell Law Group Offices, which had been located in Butler Township.
The complaint alleges Powell, Moran and the Powell firm also “stole” $6.175 million to pay the firm’s litigation costs and overhead. Most of this money covered their expenses in the environmental contamination litigation, it said.
Powell, Moran and Zappala could not be reached for comment Wednesday.
Zappala now controls the detention centers in Pittston Township and Western Pennsylvania and maintains some of the $95.6 million in damages is warranted due to the impact of the kickback scandal on the businesses, the filing says.
Other attorneys were named as defendants because they may have claims on the $150 million to $200 million from the suit, the filing says.
In addition to Zappala and his detention centers, the suit was filed by Mid-Atlantic Youth Services Corp., Consulting Innovations and Services, Inc. and Gladstone Partners, LP. Mid Atlantic managed and staffed the detention centers. Gladstone had plans to build a cargo airport in the Hazleton area.
The environmental litigation involves the former Kerr-McGee Corp. in Avoca, which manufactured railroad ties from 1956 until it closed in 1996. In legal action against Anadarko Petroleum Co., which purchased parts of Kerr-McGee, thousands maintained their health problems were caused by toxins released by the company.