District Court Judge Denies CAIR Motion to Dismiss Federal Fraud Complaints by African American and Pakistani-American Muslims
WASHINGTON , Oct. 4 /PRNewswire-USNewswire/ -- A federal judge in the U.S. District Court in the District of Columbia has denied a motion to dismiss complaints by five former clients of the Council on American-Islamic Relations (CAIR).
CAIR is a Muslim organization previously named as a Muslim Brotherhood-Hamas front group by the FBI and U.S. Attorney's Office in the federal criminal trial and conviction of a terrorist funding cell organized around one of the largest Muslim charities, the Holy Land Foundation, which raised funds for violent jihad on behalf of Hamas.
CAIR had asked federal court judge Paul L. Friedman to dismiss the fraud cases on several grounds, but the judge refused CAIR's request in its entirety.
(Judge Friedman did dismiss one duplicative claim of consumer fraud based on D.C. law because he allowed an identical claim under Virginia law, ruling that Virginia law applied in the case).
The five former clients had earlier this year filed two separate lawsuits in federal court alleging common law and statutory fraud, breach of fiduciary duty, and intentional infliction of emotional distress against CAIR, a self-described Muslim public interest civil rights law firm. These two lawsuits follow an earlier lawsuit which had also alleged that CAIR's fraudulent conduct amounted to racketeering, a federal RICO crime. In that case, the court dismissed the RICO counts concluding that CAIR's conduct as alleged was fraudulent but not a technical violation of RICO.
The two new federal civil complaints were filed in the federal district court for the District of Columbia on January 6, 2010, and served on January 13, 2010. CAIR filed its motion to dismiss on February 26, 2010, and the matter was fully briefed by May 15, 2010.
Both lawsuits arise out of the same facts and as a result the court has consolidated the two cases.
The lawsuits allege that Morris Days, the "Resident Attorney" and "Manager for Civil Rights" at the now defunct CAIR-MD/VA chapter in Herndon, Virginia, was in fact not an attorney and that he failed to provide legal services for clients who came to CAIR for legal representation. CAIR knew of this fraud and purposefully conspired with Days to keep the CAIR clients from discovering that their legal matters were being mishandled or not handled at all.
While attorney David Yerushalmi represents the five plaintiffs in these two lawsuits, three of whom are Muslim Americans, the complaints allege that according to CAIR internal documents, there were hundreds of victims of the CAIR fraud scheme.
According to the complaints, CAIR knew or should have known that Days was not a lawyer when it hired him. But, like many criminal organizations, things got worse when CAIR officials were confronted with clear evidence of Days' fraudulent conduct. Rather than come clean and attempt to rectify past wrongs, CAIR conspired with Days to conceal and further the fraud.
To this end, CAIR officials purposefully concealed the truth about Days from their clients, law enforcement, the Virginia and D.C. state bar associations, and the media. When CAIR did get irate calls from clients about Days' failure to provide competent legal services, CAIR fraudulently deceived their clients about Days' relationship to CAIR, suggesting he was never actually employed by CAIR, and even concealed the fact that CAIR had fired him once some of the victims began threatening to sue.
"The evidence has long suggested that CAIR is a criminal organization set up by the Muslim Brotherhood and Hamas to further its aims of stealth Jihad in the U.S.," Mr. Yerushalmi said referring to the fact that CAIR has been named by the federal government as an unindicted co-conspirator in the Holy Land Foundation terror financing trial. In addition, several of CAIR's top executives have been convicted of terror-related crimes. As a result, the FBI has publicly announced that it has terminated any outreach activities with the national organization, which bills itself as "America's largest Muslim civil liberties and advocacy organization."
"As it turns out, CAIR is America's largest Muslim criminal organization whose criminal activities know no bounds," Yerushalmi continued.
"According to the facts as carefully laid out in both complaints," Yerushalmi explained, "CAIR has engaged in a massive criminal fraud in which literally hundreds of CAIR clients have been victimized and because of the CAIR cover-up they still don't realize it. The fact that CAIR has victimized Muslims and non-Muslims alike demonstrates that CAIR is only looking out for CAIR and its ongoing effort to bilk donors out of millions of dollars of charitable donations thinking they are supporting a legitimate organization."
The complaint also alleges that in addition to covering up the fraud scheme, CAIR forced angry clients who were demanding a return of their legal fees to sign a release that bought the client-victims' silence by prohibiting them from informing law enforcement or the media about the fraud. According to the agreement, if the "settling" clients said anything to anyone about the fraud scheme, CAIR would be able to sue them for $25,000.
This enforced code of silence left hundreds of CAIR's victims in the dark such that to this day they have not learned that Days was not an attorney and that he had not filed the legal actions on their behalf for which CAIR publicly claimed credit. Days has since died of a lung complication.
CAIR's motion to dismiss argued that the failure to name Morris Days and CAIR-MD/VA as "indispensable" party-defendants was grounds to dismiss. The court saw through this ruse by noting that Mr. Yerushalmi had pointed out that Days was dead. Insofar as there was no probate of any estate, Days likely died intestate and poor. Similarly, CAIR-MD/VA, as alleged in the complaints, was shuttered and rendered defunct by CAIR to try and cover-up the crime. Unsuccessfully, CAIR's motion to dismiss had strategically and dishonestly ignored those facts.
CAIR also argued that it could not be held liable for Days' criminal behavior. The Court dismissed this defense as well pointing out that there was more than enough evidence to show Days acted for and on behalf of CAIR.
Over a lengthy 24-page opinion, the Court surgically dissected and dismissed CAIR's arguments for dismissal on all counts.
Mr. Yerushalmi made clear that "the evidence in this case will finally put to rest the myth that CAIR is a legitimate Muslim American civil rights organization when in fact it is little more than an agent of the Muslim Brotherhood and a recipient of huge donations from operatives of the Organization of Islamic Countries (OIC)."
Mr. Yerushalmi concluded, "Why this organization is allowed to exist as a non-profit, tax-exempt organization at all is mind-boggling."
For those interested in a fact-intensive tutorial on CAIR's foreign government agency connections in the context of possible violations of the Foreign Agent Registration Act, the same law used recently to arrest and deport a large sleeper cell of Russian spies, they need only visit http://www.CAIRObservatory.org, where the actual documents evidencing potential crimes are on full display for the reader to judge for him or herself.
About David Yerushalmi, Esq.:
David Yerushalmi has been practicing law for more than 26 years. He is a litigator specializing in securities law, public policy relating to national security, and public interest law. Mr. Yerushalmi is licensed and practices in Washington D.C., New York, California, and Arizona and currently serves as General Counsel to the Center for Security Policy in Washington, D.C., one of the nation's leading national security think tanks founded by former Reagan administration official Frank J. Gaffney, Jr.
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