Fort Lauderdale Attorneys Sanctioned For Frivolous Lennar Action
A state appellate court ordered sanctions against two Fort Lauderdale attorneys for filing a frivolous action tied to a stipulated $584 million judgment for Miami-based home-builder Lennar Corp. in its fraud lawsuit against convicted swindler Barry Minkow.
A three-judge panel of the Third District Court of Appeal in Miami sanctioned Grumer & Macaluso managing partner Keith T. Grumer and associate Jason N. Goldman for filing a frivolous appeal.
The penalty, to be set later, will be half of Lennar's attorney fees on the issue. The court also referred the attorneys to The Florida Bar for possible disciplinary action.
"Counsel might have cast a dagger into the heart of the rule of law," Chief Judge Frank Shepherd wrote for the panel. Judges Richard J. Suarez and Vance E. Salter concurred.
Grumer & Macaluso represent developer Nicolas Marsch whose company Briarwood Capital LLC has been in a long-standing litigation with Lennar after a partnership failed on a proposed development in Rancho Santa Fe, California.
While Goldman said he had no comment, Grumer called Wednesday one of the darkest days in his 28 years of practice. He noted Miami attorney David M. Gersten, a former Third Circuit judge, represents Lennar.
"I have to say the viciousness of this opinion smacks of the political strength of Lennar and its counsel," Grumer said. "I am crushed that I was treated like this by the Third."
Lennar's civil suit against Marsch and Briarwood accused the developer of hiring ex-convict Barry Minkow to disseminate false information about Lennar through his Fraud Discovery Institute Inc. to drive down the stock price.
After a Miami-Dade trial court found Minkow destroyed evidence, it entered a $587 million default judgment against him.
Minkow was a renowned entrepreneur who went to prison for fraud. After his release, he became a pastor and a purported fraud fighter who worked with authorities.
He is serving a five-year prison sentence for using his Fraud Discovery website to falsely accuse Lennar executives of fraud in a stock manipulation scheme. One of Marsch's attorneys in California confirmed an unnamed co-conspirator in the federal case filed against Minkow was the developer.