IN THE CIRCUIT COURT OF THE

IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT, IN AND FOR PALM BEACH COUNTY, FLORIDA CASE NO.: 502009CA040800XXXXMBAG JEFFREY EPSTEIN, Plaintiff, vs. SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and L.M., individually, Defendant, NOTICE OF FILING TRANSCRIPT IN SUPPLEMENTAL SUPPORT OF BRADLEY EDWARDS' MOTION FOR SUMMARY JUDGMENT Defendant/Counterplaintiff, BRADLEY J. EDWARDS, by and through his undersigned attorneys, hereby gives notice of the filing of the transcript of the deposition of Scott Rothstein taken on June 14, 2012. Specific portions of the deposition on which Mr. Edwards' relies in support of his motion for sununary judgment are highlighted. I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished by 1-10 U.S. Mail to all counsel on the attached lis day of June 2012. RO A ar No.: 169440 Denney Scarola Barnhart & Shipley, P.A. 9 Palm Beach Lakes Boulevard est Palm Beach. Florida 33409 Attorneys for Bradley J. Edwards EFTA01130733 Edwards adv. Epstein Case No.: 502009CA040800XXXXMBAG Notice of Filing Transcript In Supplemental Support of Bradley Edwards' Motion for Summary Judgment Page 2 of 2 COUNSEL LIST Bradley J. Edwards, Esquire Farmer, Jaffe, Weissing, Edwards, Fistos 425 North Andrews Avenue, Suite 2 Fort Lauderdale, FL 33301 Jack A. Goldberger, Esquire Atterbury, Goldberger & Weiss, P.A. 250 Australian Avenue South, Suite 1400 West Palm Beach FL 33401 Marc S. Nurik, Esquire One E Broward Blvd., Suite 700 iierdale FL Toot Haddad Coleman, Esquire Law Offices of Tonja Haddad, P.A. 524 S Andrews Avenue, Suite 200N Fort Lauderdale. FL 01 Lilly Ann Sanchez, Esquire The L-S Law Firm 1441 Brickell Avenue, 15th Floor Miami, FL 33131 EFTA01130734 Page 1 IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA GENERAL JURISDICTION DIVISION JEFFREY EPSTEIN, Plaintiff, vs. No. 502009CA040800XXXXMBAG SCOTT ROTHSTEIN, individually, and BRADLEY J. EDWARDS, individually, Defendants. 500 East Broward Boulevard, Ft. Lauderdale, Florida Thursday, June 14, 2012 9:14 a.m. - 12:37 p.m. DEPOSITION Of SCOTT ROTHSTEIN (Via Video Conference) Taken on behalf of the Trustee pursuant to a notice of taking deposition - - - FRIEDMAN, LOMBARDI & OLSON 305-371-6677 5ed93085-0554-4471•bcdd-ca2d81e841d1 EFTA01130735 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES: 2 LAW OFFICES OF IOWA HADDAD, P.A. by 3 Tonja Haddad, Esq. Attorney for the Plaintiff. 5 AT'fERBURY, GOLDBERGER & WEISS, P.A., by Jack Goldberger, Esq. 6 Attorney for the Plaintiff. SEARCY DENNEY SCAROLA ET AL, by 8 Jack Scuola. Esq. Attorney for the Defendant, Brad Edwards 4 9 10 11 12 MARC NUIUK, PA , by Marc Nurik, Esµ Attorney for Scott Rothstein (Appearing via Video Conference.) 13 U.S. ATTORNEY'S OFFICE, by Laurence LaVecchio, Esq. Attorney for the Department of Justice Page 2 1 2 3 , 4 5 6 7 8 10 11 12 13 14 15 16 27 18 19 20 21 22 23 24 25 Thereupon: SCOTT ROTHSTEIN, was called as a witness and, having been duly sworn, was examined and testified as follows: THE WITNESS: I do. MS. HADDAD: Good morning, Scott. How are you? THE WITNESS: Good morning, Tonja. How are you? MS. HADDAD: Fine, thank you. It's nice to see you. THE WITNESS: Good to see you, too. MR. SCAROLA: Mr. Rothstein, I don't know that you and I have met. I'm Jack Scarola, I'm representing Brad Edwards and I know you know Brad who's to my immediate left. THE WITNESS: Hey, Brad, how are you? Jack, good to see you. MR. SCAROLA: Thank you. MR. GOLDBERGER: Also present is another Jack, Jack Goldberga, and I also represent Jeffrey Epstein. To my right is Darryn Indyke -- THE WITNESS: Good morning, Jack. MR. GOLDBERGER: How are you today? And to my right is Darryn Indyke, who is Page 4 I 2 3 4 (By Ms. Haddad) 5 5 (By Mr. Goldberger) 92 (By Mr. Scarola) 121 6 7 8 INDEX WITNESS DIRECT CROSS REDIRECT RECROSS SCOTT ROTHSTEIN 9 EXHIBITS PLAINTIFFS FOR IDENTIFICATION 10 I 2 3 11 12 13 19 15 16 17 18 19 70 21 72 23 74 25 64 69 72 Page 3 1 Mr. Epstein's in-house counsel. 2 MR. INDYKE: Good morning. 3 THE WITNESS: Good morning, sir. 4 MR. NORA: Good morning, everyone. 5 MR. GOLDBERGER: Hi, Marc, how are you? 6 MR. NURIK: Good. You'll be seeing my 7 shoulder most of the day. 8 W. GOLDBERGER: Okay. 9 DIRECT EXAMINATION 10 BY MS. HADDAD: 11 Q. Well, Scott, J know you've talked about this 12 probably more than you even care to, but I'd like to 13 start a little bit asking you about the scheme at your 14 firm and how and when it started and things of that 15 nature just very briefly because I know you've covered 16 it many times. 17 MR. SCAROLA: It has been covered and 18 protocol precludes asking questions that have already 19 been answered and covering areas that have already 20 been covered, so we do object. 21 MR. GOLDBERGER: Your objection is noted. 22 BY MS. HADDAD: 23 Q. When did this first start? 24 A. It started back in '05, '06. The question 25 is a little bit vague for me because it started in a Page 5 "Mk 2 (Pages 2 to 5) FRIEDMAN, LOMBARDI & OLSON 305-371.6677 6•0930864564-44Mbedd-ca201s9410 EFTA01130736 1 different form than it ended because it started as 2 bridge loans and things of that nature, and then 3 morphed into the Ponzi scheme. But you are looking 4 back into the 2005 time frame for the very beginning. 5 Q. The 2005 time frame, that's when the bridge 6 loans started? 7 A. I can't be certain exactly what we were 8 doing. I need to see all the documents to tell you 9 what we were doing at what specific point in time. 10 Q. What made you decide to start doing this? 11 A. ! started doing it out of greed and the need 12 to support the law firm, which was having significant 13 financial trouble at the time. 14 Q. And in 2005 had you moved over to 401 yet or 15 were you still in the building where Colonial Bank 16 was? 17 A. I don't remember. 18 Q. Do you recall approximately how many 19 attorneys you had working for you when it started? 2 0 A. 1 do not. Between five and ten, Tonja. 21 Q. Was it before you started acquiring 2 2 attorneys like you were acquiring cars and watches? 2 3 MR. SCAROLA: Object to the form of the 2 4 question, vague. 2 5 THE WITNESS: Yes. Page 6 1 ". 2 3 45 6 7 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 growth started," do you mean both the scheme — do you mean the scheme and the firm or either one or both? A. Both. Q. Do you recall approximately when you took the space in the 401 Building? A. 1 do not. Q. At the time everything imploded, how many partners did you have at the firm, do you recall? A. Are you saying partners and shareholders? Because remember, we had both, two designations. Q. 1 want to start with just attorneys that had — not in your firm name but named as "partner' on the cards, for example. A. I'd have to see a list of all the employees. We had a bunch. Q. Do you recall about how many attorneys you had working there? A. Approximately 70. Q. In the year before, do you recall how many you had? A. I do not. Q. So how many equity manners did you have or shaSs? I'm not sure of the word that we are using. A. Actual shareholders, equity shareholders Page 8 1 BY MS. HADDAD: 2 Q. Well, who were you partners with when it 3 first started? 4 A. Stu Rosenfeldt. 5 Q. Okay. Anyone else? 6 A. Susan Dolin, I believe. It was definitely 7 Stu Rosenfeldt, Michael Fancier, and Susan Dolin may 8 have been partners of ours at that time, I'm not 9 certain. 10 Q. Because if memory serves me correctly, you 11 went from being in the One Financial Plaza Building to 12 the building across the street, it was Rothstein, 1 3 Rosenfeldt, Dolin and Pancier; is that correct? 14 A. Yes. 15 Q. And it was some time later that you moved 16 into the 401 Building, correct? 17 A. You are skipping one step. I went from One 18 Financial Plaza to Phillips, Eisinger, Koss, Kusnick, 19 Rothstein and Rosenfeldt. Then Stu Rosenfeld% and 1 2 0 broke off and formed Rothstein Rosenfeldt. And then 21 Rothstein, Rosenfeldt, Dolin, Fancier over at the 2 2 Colonial Bank Building. And then we took the space in 2 3 the 401 Building and eventually moved over there and 2 4 that's when the real growth started. 2 5 Q. And when you say, "that's when the real Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 were two, me and Stu Rosenfelt Q. And everyone else was just a partner for title purposes? A. There were shareholders for title purposes and partners for title purposes. Q. If someone was called a shareholder for title purposes then, did they get to receive any of the funds? Were they shareholders receiving money or they were not considered shareholders in that sense? MR. SCAROLA: Objection to the form of the question. THE WITNESS: What kind of funds are you talking about? BY MS. HADDAD: Q. In general from the firm. When you say equity shareholders, I understand that's you and Stu. What I'm saying is, if you had someone else that was named as a shareholder, why did you call them a shareholder as opposed to a partner? A. It was a title of prestige and achievement,. Q. So it was basically an ego thing, it had nothing really to do with the finances or hierarchy of the firm? A. They got paid more generally, but it did not have anything to do with distributions. Page 9 3 (Pages 6 to 9) FRIEDMAN, LOMBARDI & OLSON 305-371-6677 Sed93085.0554.447f.bcdd-ca2d8te947d1 EFTA01130737 1 Q. When you were hiring and bringing in all 2 these new attorneys, did everyone come in as a 3 partner? 4 A. No. 5 Q. How did you decide who came in as a partner 6 and who came in as an associate? 7 A. Depended upon their level of expertise, 8 practice, book of business. It was a decision Stuart 9 and 1 made together on a case-by-case basis. 1 0 Q. So you and Stu where the -- were in charge 1 1 of hiring? 2 A. Stuart and I tried to consult on every 1 3 hiring decision, yes. I. 4 Q. Did you guys also decide salaries? 1 5 A. I generally decided the salary and then let 1 6 Stu know what I was going to do. And he would say if 1 7 he thought it was okay or if he thought it was too 1 8 much or too little, but I generally had free reign in 19 that regard. 2 0 Q. Did someone's book of business directly 21 correlate to the salary that you would offer? 2 2 A. That is a very broad question because it 23 depends upon what other needs we had for that 2 4 individual. 2 5 Q. What do you mean by "what other needs"? Page 10 1 2 3 4 I 567 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q. Would you need to look at someone's book of business if they were coming in just solely to be a rainmaker for the firm prior to hiring them? A. I discussed it with them. There were not many people that I recall that I actually looked at their numbers. Once David Boden was working for me I had him check people's numbers, but I rarely looked. I took most people's words for what they were generating. Q. My recollection is, you were always looking to bring in more people, to hire more people, some of us were somehow able to resist you while others were not. How would you decide who you were looking at to bring into your firm? A. We were trying to develop, on the legitimate side of the law firm, we were trying to develop real talent, real ractice groups. I mean, Brad is a perfect exampleareat lawyer, got a great reputation, You know, it was our hope that, you know, he was going to be one of the people to actually in some ways rescue the firm because he had a practice group that could generate substantial income. You know, on the legitimate side that's what we were trying to do. we were trying to find the best and the brightest. Q. Okay. With respect to bringing people that Page 12 1 A. Well, I'll give you a good example. My 2 lawyer, Mr. Nurik, his salary was directly related to 3 the fact that he was a great lawyer and had a solid 4 book of business. 5 Q. Yes. 6 A. David Boden, on the other hand, was, as I 7 previously testified, I don't know if you've had a 8 chance to read the testimony, but David Boden was not 9 only the general counsel to the law finn but he was 10 also — acted as my consigliere in a significant 11 number of illegal operations and he was compensated 12 significantly for that, if that helps you understand 13 the difference. I 4 Q. It does. 15 So, for example, when you were hiring former 16 judges, let's use that as an example, Pedro and Julio, 1 7 clearly they don't have a book of business coming in 18 because they haven't had clients, but they may carry 19 some sort of prestige or give some legitimacy, if you 7 0 will, to the firm. How would you decide the salary 21 for someone like that? 12 A. Stu and l would discuss it. It was more a 3 market issue than anything else, how much arc judges 2 4 coming off the bench getting, how much business do we 25 think they can generate. Page 11 1 you thought could hring_a book of bulinesscou just 2 said Brad, for example, that he had a legitimate 3 practice_maro witILagoraLhoolcalusifl did 4 you know that? 5 A. Everyone in the tort world that I had spoke 6 to spoke extremelylighlv_offirad not only neonle I 7 already had working forme but other People that knew 8 rim. He was very -- came very highly recommended to 9 us. 10 Q. Like who, for example? 11 A. We wanted him in there. We were trying to 12 develop a significant tort group and we thought that 13 he'd be a great part of it. 14 Q. Who besides Russ told you that about Brad? 15 A. It would have been other people in the ton 16 group. I don't want to guess, Tonja, as to which 17 other people told me, but it was -- well more than 18 Russ. 19 Q. Was it people within — 20 A. Might have been people in politics that I 21 talked to that knew him because we had significant 22 input at the gubernatorial level with regard to tort 23 reform and the like, and there were people there who 24 knew who Brad was. It was more than one person that 25 told us that. Page 13 4 (Pages 10 to 13) FRJEDMAN, LOMBARDI & OLSON 305-371.6677 5cd93085.0554-4471-bcdd-ca2difenkli EFTA01130738 Q. Okay. When you were looking_arneoole to 2 bring in to the firm to legitimize, as you said. Your 3 fine had a very unique area of practice and had a very 4 unique environment to which to work. How did you know 5 or how did you come to decide what people may or may 6 not fit into that? 7 A. Okay. Renton one second. I think you his) 8 accidentally misstated my testimony. 9 I was not bringing the people in to 10 legithnize the law firm. I was bringing them in to 1 1 the legitimate side of the law finn. The bulk of tht 12 law firm, despite the lack of financial success, was a 3 large group of very honest, hard working lawyers 1 4 trying to do their best in difficult economic 1 5 conditions. There were some that were obviously not 1 6 legitimate. And the way I decided to bring people in, 17 again, it's really everything I just told you. Are 18 you looking for how 1 brought people into the Poozi 19 scheme? 20 Q. No, right now I'm just asking about the finn 21 because, as 1 said, it's a very unique way in which to 22 practice and a very unique workplace environment with 2 3 politics and restaurants and parties at your home and 2 4 things of that nature. I'm asking, personality wise, 2 5 other than the book of business, how did you decide on Page 14 1 t 1 that time with Farmer and Fistos and Jaffe and 2 Mr. Edwards. 3 Q. Do you know where Mr. Edwards was working 4 when you first learned of him? 5 A. I don't recall whether he was working for 6 someone or had his own practice, I don't recall. 7 Q. When did you first learn about Brad? 8 A. I don't remember the time frame. 9 Q. Do you recall when you first met with him 10 regarding a job? 11 A. No. The easiest way to figure that out is 12 to go look at his personnel file, it will have the 13 notes saying when he met with me the first time. 14 Q. You don't have any recollection of your 15 first meeting with him? 16 A. No. As you know, 1 was hiring people left 17 and right and I was also unfortunately very busy doing 18 things I shouldn't have been doing, so I don't have a 19 specific recollection of when 1 hired him. 1 barely 20 have a specific recollection of when 1 hired me. 21 Q. But you did, in fact, meet with him? 22 A. I'm certain I met with him before I hired 23 him. I can't imagine -- although I did hire people 24 without meeting them. I did hire people based on 25 other people's word, if they were people within the Page 16 1 people that would be a good fit? 2 A. I looked for people that were outgoing, that 3 had the type of personality. On the legitimate side 4 of the business, people that had charisma that were — 5 that could go out and hustle and try to develop a book 6 of business if they didn't have it. And as one of the 7 50 percent of the shareholders of the firm I was 8 trying to hire people I wanted to work with. 9 Q. Okay. When you would see people from whom 10 you would offer jobs, for example, as you mentioned 11 earlier with Brad and his practice, if somebody stated 12 that people told you that he was a good lawyer, did 1 3 you need to see him in action, so to speak, prior to 1 4 your deciding to hire them or would you just take 15 people at their word for it? 16 A. Some of people I saw in action; he wasn't 1 7 one of them. Steve Osber is an excellent example of 18 that. 1 hired Steve after he was beating the living 19 daylights out of me on the other side of a case. And 20 I certainly would ask around about the people. But 21 the people that l trusted -- see, I can't remember. 1 22 think Gary Fanner was working for me before Brad, and 3 if I'm not mistaken he would have been one of the 24 people that 1 went to with regard to Brad because we 2 5 were really developing that whole tort group around Page 15 1 finn that 1 trusted. Because I always said, I had a 2 very simple, you lie or die by what you are telling 3 me. If you are telling me this guy is good and he's 4 not good, that's on you, it's going to hurt your 5 income. So I used to tell my partner, people that 6 were recommending people to me, don't sell me a bill 7 of goods just to get somebody in here because if you 8 do that it's going to come back on you, it's going to 9 affect your income and your ability to grow in the 10 firm. So with that admonishment, I might have very 11 well hired someone sight unseen based upon what 12 someone else told me. 13 Q. But you did meet with Brad you say before he 14 came in to work? 15 A. Now that I'm saying it out loud, I think 1 16 did but really I'm guessing. I don't have a specific 17 recollection of meeting him. 18 Q. Do you recall if you knew that he had worked 19 as an assistant state attorney for a few years prior 20 to doing tort litigation? 21 A. I don't recall that one way or the other. 22 Q. So you wouldn't have asked Howard Scheinberg 23 or anybody about him before he came to work there? 24 A. I can't say that I wouldn't have asked 25 because, like 1 said, I might have asked. But Page 17 5 (Pages 14 to 17) FRIEDMAN, LOMBARDI & OLSON 305-371.6677 1140930854554-447f-buld-cs201O•941d1 EFTA01130739 1 unfortunately, you are taking a little tiny spot out 2 of a very, very busy time period in my life and in the 3 life of the firm, so 1 can't tell you one way or the 4 other. 5 Q. I know you had a lot going on, I'm just 6 trying to see if you remember anything specific about 7 this. B Do you recall what salary you had offered 9 Brad to come join the firm? 10 A. I do not. You have to just try to 11 differentiate that what I knew then is a lot different 12 than what 1 know now so ... 13 Q. Meaning? 14 A. Obviously meaning that at the point in time 15 that I was hiring him or maybe a year after,l would 16 be able to tell you what 1 was paying him, but now 17 it's insignificant. I don't remember how much I was 18 paying him. 19 Q. Did you learn about his book of business or 20 know what kind of cases he was bringing in prior to 21 hiring him? 2 2 A. I do know that he — 1 discussed either with 2 3 Russ, well, I know with Russ, and perhaps some other 24 people, I knew about the Epstein case. 25 Q. What did you know about it? Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A. Epstein was a billionaire Q. Okay. Did you know anything about the legitimacy or illegitimacy of the claims prior to knowing he was a billionaire? A. I knew what I was told. I didn't check it out myself, but I trusted the people that told me. Q. And who told you? A. The only person I remember discussing it with, as I sit here today, is Russ Adler. But if Farmer and Jaffe and those guys were with me al the time I likely would havesliseussed it with them a§ Bra, Q. So were you aware of tlt case before tau made an offer to Brad to join the firm? A. In Q. You said you didn't -- I don't want to misquote you. You said you heard about it from other people, but you didn't do anything to know that personally. Was that before you made the offer of employment? A. I made the offer of employment based upon what other people had told me about Brad. Q. About Brad and his book of business or just Brad and his legal skills? A. Okay. When I say Brad, I mean Brad and his Page 20 1 A. I knew that it was a significant case of 2 potentially significant value against an extremely 3 collectible_rxxloph i le. for lack of a better word. 4 Q. So was that case your primary motive in 5 bringing Brad into the firm? 6 A. ) doubt it. I mean, I can't tell you one 7 way or the other, but I doubt that I would bring him 8 in just for one case because what _lithe case fails, 9 then I'm stuck with a lawyer who can't do anything, 10 you know. 1 1 I'm not saying, Brad, that you couldn't do 12 anything, I'm just saying that if 1 only relied on one 1 3 case, then if I bring a lawyer in for one case and one 14 case only, what do I do with him when the case is 15 over. 16 Q. How did you know that this case would be a 17 collectible case then? 18 MR. SCAROLA: I'm going to object to the 19 form of the question because it misstated the prior 2 0 testimony. The prior testimony was not that it was a 21 collectible case but that it was a case against a 22 "extremely collectible pedophile." 2 3 BY MS. HADDAD: 2 4 Q. What made you think that this case had any 25 financial value? Page 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 book of business and his legal skills. Q. Okay. A. And his ability to generate business in the future. Q. You stated that you believed that you first heard about these cases from Russ and then perhaps from Brad. Once Brad was at the firm, did you keep up with these cases, these Epstein cases? MR. SCAROLA: Excuse me, I'm going to object to the form of the question. II is an inaccurate reflection of the prior testimony. It has no predicate. There was no reference about having heard about these cases from Brad. The names mentioned were Adler, possibly Farmer, possibly Jaffe. BY MS. HADDAD: Q. Once Brad started workings the firm you've already testified you already knew about these Epstein cases, correct? A. Yes. Q. How did youlteenabreast of these cases? A. I didn't. Q. You didn't know anything about them? A. I didn't say I didn't know anything. I said I didn't keep track of it. Page 21 6 (Pages 18 to •21) FRIEDMAN, LOMBARDI & OLSON 305-371-6677 5od93085.0554-4471-bcdd-ca2d810941dt EFTA01130740 1 Q. You didn't keep track of it? 2 A. 1 did not keep track of it. From time to 3 time Russ and the other guys in the tort group would 4 tell me what was going on in certain cases, but until 5 I made a decision to utilize that file for an illerar- 6 purpose related to something illegal that 1 was doing 7 along with my-co-conspirators, I lust assumed my 8 lawyers were going to work the case and eventually it • 9 would hopefully work out well for the law finn. 10 Q. At your firm, when e-mails would go out to 1 1 attorneys at RRA or all attorneys at RRA, were you 12 part of that e-mail group? 13 A. You are talking about all staff? 1 4 Q. No, all it says is attorneys at RRA. 15 A. It's the e-mail group "attorneys"? 16 Q. Yes. 17 A. Yes, I'm a part of that e-mail group. 1 6 Q. And I appreciate that you were very busy and 19 may not have read all of them, but you did receive 2 0 those e-mails when they would go around? 2 1 A. Yes, and I tried my best to read them. 2 2 Q. Okay. At what point did you decide to use 2 3 this case to further your Ponzi scheme? 2 4 A. I don't remember the date, but 1 can give 2 5 you the circumstances, if you'd like. Page 22 t 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 interaction — Sony, Tonja, I didn't mean to speak over you. If you talk to the people in the firm. if they are honest with you, they'll tell you my interaction was far more significant with Russ Adler, Probably more so because he was a co-conspirator of mine. My interaction with Russ was far greater by many, many percents over my interaction with Brad, and then you go down the line. I had more interaction with Mr. Fanner than I did with Mr. Fistos, more interaction with Jaffe than I did with Mr. Edwards, and so on. Q. Russ was the head of your tort group, right? A. Yes. Q. So these cases fell under the tort group; is that correct? A. Yes, it fell under the -- fell under Russ' purview ultimately, yes. Q. And Brad was a partner at your firm during the time these cases were there, correct? A. I believe that was his title. He was either partner or shareholder. I don't think we had made him a shareholder yet. Q. But he wasn't coming in as an associate, Page 24 1 Q. Please do. 2 A. The Ponzi scheme was running very low on 3 capital. My co-conspirators and 1 needed to find a 4 new feeder fund, new investment sources. We had a 5 couple of very large, significantly wealthy potential 6 investors out there. I was looking for something that 7 would have been very attractive. We had had a lot of 8 inquiry during the due diligence period with these 9 people that were doing due diligence on the putative 10 cases that we were selling. And when I thought about 11 the Epstein case, realizing that it was a substantial 12 actual file in the office, I came up with the idea 13 that if I created a fake confidential settlement 14 circling around — based upon this actual_case, they 15 would be able to increase the level of due diligence 16 that I was able to offer to my potential investors. 17 Q. How did you know this was a substantial file 18 in your office at that time? 19 A. Again, through the people 1 spoke to in the 20 office. 21 Q. Such as who? 22 A. Again, same people, Adler, Farmer, Jaffe, 23 Fistos. 2 4 Q. You never spoke to Brad about this case? 2 5 A. 1 didn't say that. but 1 had a lot more Page 23 1 correct? 2 A. To the best of my recollection, no. 3 Q. So you stated that you learned this case 4 was -- I don't want to misquote you and listen to a 5 long speaking objection, but what did you call this 6 case? 7 MR. SCAROLA: Who wants the quote? 8 THE WITNESS: It was a substantial case 9 with a -- what I perceived to be a highly collectible 10 pedophile as a defendant. 11 BY MS. HADDAD: 12 Q. Right. How did you know at the time when 13 you said these investors wanted to investigate and you 14 said you were going to create a fake settlement, how 15 did you know that this case was the case that you 1 6 could use? 17 A. From talking to all the people that I just 18 said, Adler, Fistos, Jaffe, Farmer, Mr. Edwards, to 19 the extent that I spoke to him about it. 20 Q. Did you speak with Mr. Edwards about the 21 case? 22 A. I don't have a specific recollection one way 23 or the other. 1 remember speaking to him at least 24 briefly the day or the day of or the day before the 25 actual investor's due diligence was going on as to Page 25 7 (Pages 22 to 25) FRIEDMAN, LOMBARDI & OLSON 305-371-6677 5ed93085-0554-4471-bcdd-ca2d810941d1 EFTA01130741 1 what was going on. And 1 may have spoke to him, I 2 know I spoke to Russ, but 1 may have spoke to him as 3 well within a couple of days just prior to this due 4 diligence because I was trying to at least get some 5 information in my head that ] could use when I was 6 creating this story for the investors. 7 Q. Scott, what's Q-task? 8 A. Q-task is a web based software system that 1 9 had invested 37 million in. 10 Q. And what was the purpose of this internet 11 system? 12 A. To be able to communicate in a secure 1 3 fashion and in a unique group fashion about specific 14 files. 15 Q. So forgive me, we all know I'm not good with 1 6 the computer. That was something that would be useful 17 within a law firm, why? 18 A. Because it allowed you to create groups and 19 have both general and private chats, organize data in 20 a very unique fashion. That was, at least to our way 21 of thinking, would have been very, very helpful in the 22 law firm setting with multiple practice groups. 2 3 Q. Did you belong to any groups on Q-task? 24 A. I'm certain that I did. 1 don't remember 2 5 which groups I belonged to. I never got into the full Page 26 1 and with that, with the Q-task and the e-mails, did 2 someone assist you with reviewing everything and 3 letting you know what was going on within the groups? 4 MR. SCAROLA: Excuse me. I'm going to 5 object to counsel's testimony. Object to the form of 6 the question as leading. 7 THE WITNESS: I really don't even 8 understand the question. 9 Can you try to rephrase it for me. Tonja? 10 BY MS. HADDAD: 11 Q. Of course, I would. 12 Did you keep abreast of everything that was 13 going on in every practice group or was someone 14 through Q-task and e-mails, for example, or was 15 someone giving you information keeping you posted on 16 what was going on within the practice? 17 A. Well, as pan of the tort group l had a 18 pretty good idea of what was going on there all the 19 time just because of the significant amount of 20 interaction, both legitimate and otherwise, that I had 21 with Russ Adler, so I was probably more up-to-date on 22 that group than any group other than the labor and 23 employment group, again, because ] had such 24 significant interaction with Stu Rosenfeldt, both 25 legitimately and illegitimately, so I knew what was Page 28 1 use of it. I tried to, but again, l was vet), busy 2 doing other things. But 1 know that Mr. Adler's group 3 used it extensively. 4 Q. Because it was your firm and, as you said, 5 you invested S7 million in it, did you have the 6 ability to access a group if you wanted to? 7 A. Yes. And if l couldn't,1 could get Russ to 8 give me access. 9 Q. So you didn't necessarily have to be invited 10 into the Q-task group for you to be able to utilize or 11 view the communications within it? 12 A. No, that's not true. I actually had to be 13 invited, that's what 1 was telling Russ to do, is to 14 have me invited. 15 Q. But I'm saying, the lawyers wouldn't have to 16 personally invite you, you can get someone within your 17 firm to give you access maybe without the lawyers 18 knowing? 19 A. No,1 think it might have had a, quote, 20 unquote, confidential, super secret viewing 21 capability, but I don't recall it having that, and I'd 2 2 have no need to utilize that. Just invite me into the 23 group and let me see what's going on. 2 4 Q. Okay. 1 know that you are or were a very 25 hands-on person within certain of the practice groups Page 27 1 going on in that group. 2 I tried, as best as I could, given my time 3 constraints, to stay on top of what was going on, you 4 know, throughout the firm. But 1 relied on other 5 people like Debra Villegas and Irene Stay and David 6 Boden, Les Stracker to the lesser extent, to monitor 7 what was going on in the different practice groups and 8 keep me up to speed. 9 Q. Was there audio and video surveillance 10 throughout the entire firm or only within your office? 11 A. No, through the entire office, not in the 12 individual offices. 13 Hang on. Not in the individual offices but 14 throughout the general office space. 15 Q. So in 2009 how many floors did you have? 16 A. Three,1 think. 17 Q. And do you recall approximately how many 18 attorneys you had working there at that time? 19 A. Approximately 70. 20 Q. And when you say "not the individual offices 21 but the other areas," do you mean -- would that 22 include conference rooms? 23 A. I didn't have surveillance in the conference 24 rooms. 25 Q. So can you please tell me exactly where you Page 29 8 (Pages 26 to 29) FRIEDMAN, LOMBARDI & OLSON 305-371-6677 Sed93085-0554-4471-bcdtl-ca2d81.3941dI EFTA01130742 1 had audio and/or video surveillance? We'll start with 2 audio. 3 A. I don't have a specific recollection of 4 every place I had video and audio, but it was in -- I 5 had it set up so that in all of the common areas, 6 including our shareholder's lounge, we had -- I had 7 audio and video capabilities. 8 Q. When you say *capabilities," does that mean 9 you didn't always turn it on or you just turned it on 10 when you felt like it? 1 A. I tamed it on when I felt like it, when 1 12 felt like seeing what was going on. I sometimes left 13 the screen up because) had four computer screens on 14 my desk, I sometimes left the screen on with the video 15 of the reception area and some other general areas. 16 But unless I wanted to see what was going on or listen 17 to what was going on, I didn't turn it on. It would 18 have been too distracting. 19 Q. Did the attorneys know that this 2 0 surveillance existed? 21 A. You can see it in the — it wasn't hidden, 2 2 you can see it. There were globes up in the ceiling 2 3 all over the office. 2 4 Q. Did you have — you said — you didn't 2 5 answer this, you said you didn't recall. Did you have Page 30 1 out, because I remember building out space and I 2 remember Jaffe and all those guys moving into that 3 space. 4 Q. If you were building up that space, do you 5 recall when you put the surveillance in there? 6 A. It would have been while they were building 7 it out or shortly thereafter. 8 Q. During 2009 it seems that you hired lots of 9 former law enforcement people to work at the firm. 10 Why were they people you wanted to hire? 11 A. Severalfold. I had a significant amount of 12 illegal activity going on with various law enforcement 13 agencies throughout South Florida and hiring people 14 from former law enforcement assisted me in engendering 15 support and camaraderie with the law enforcement that 16 1 was actually utilizing in illegal activities. 17 Q. So you are saying 18 A. Secondarily, I wanted to have a very strong 19 investigative team, ultimately, to do both legitimate 20 and illegitimate things for the law firnt, and hiring 21 former law enforcement was the best way to do that. I 22 was hoping to actually ultimately create a group. Ken 23 Jenne and I had talked about that extensively. 24 Q. Why did you hire Ken Jenne? 25 A. Prior to Ken going to prison, he and I were Page 32 1 any surveillance in the conference moms? 2 A. No. 3 Q. Other than the common areas you just went 4 over, in the hallways and the reception — did you 5 have it in the hallways, is that a common — do you 6 deem that a common area? 7 A. All the hallways pretty much with the 8 exception of a few blind spots,/ can see all the 9 hallways. 10 Q. And this was on all three floors? 11 A. Yeah. For some reason I think we might 12 have taken some space on a fourth floor, but I could 13 be mistaken. But yes, on the three floors that we 14 actively had a significant amount of space on, I tried 15 to have surveillance on all the common areas of all 16 that space. 17 Q. And what floor was Mr. Edwards' office on? 18 A. 1 don't recall. 19 Q. Did you have the tort group all together or 2 0 was it divided up? 21 A. Except for Adler, Adler was on with -- near 2 2 me, down the hall from me. The rest of the group was 2 3 all together. I think they were on — let's see. 24 There were people up on 22. I was on 16. He must 2 5 have been on the other floor that we were building Page 31 1 very friendly and he was extremely friendly with 2 someone that was very close to me, Grant Smith. 3 During the time that he was down in FDC Miami, I went 4 down to visit him. And after speaking to him and 5 after speaking to Grant, I told him, because he was 6 talking to me about how many people had turned on him 7 and abandoned him. And I told him that when he got 8 out of jail that he had no worries, that I would give 9 him a job. 10 Q. And what -- 11 A. And that was the primary reason -- that was 32 my primary reason for hiring him. 13 Q. What was it you were hiring him to do 14 exactly? 15 A. Ultimate the goal was to head up on 16 investigative ann within RRA, within the RRA entities. 17 Q. Well, while he was there, since that didn't 18 happen, what was his obligation to the firm 19 day-to-day? 20 A. He handled film security issues and he did 21 handle overseeing certain investigative things. We 22 had an alcohol and beverage group that was forming and 23 he was overseeing that. Ile was helping me find new 24 people to staff it, that kind of thing. 25 Q. Did you have a lot of interaction — Page 33 9 (P.ages 30 to 33) FRIEDMAN, LOMBARDI & OLSON 305-371.6677 50c/93085-0554 -4471-bcdthca2d81094101 EFTA01130743 1 A. He had had significant -- as you know, he 2 also had significant political connections and 3 everyone who is not living under a rock knows I was 4 doing everything I could to gamer significant 5 political power. 6 Q. I think many people miss your parties. 7 But, with respect to Mr. Jenne and his 8 political connections, were you hiring him to utilize 9 him with respect to any of the police department 10 investigations? You had stated earlier you had 11 dealings with police departments. I don't want — 12 again, I don't want to put words in your mouth. You 13 said you had dealings going on with various police 1 4 agencies? 15 A. I had —1 mean, we had a criminal defense 16 section in the law firm, so we had legitimate dealings 17 with law enforcement. But I also had significant 18 illegitimate things with law enforcement that had 19 nothing to do with Ken Jenne. 2 0 Q. And how about with respect to former FBI 1 agents you were hiring? 2 2 A. They were all people that were operating in 2 3 a legitimate fashion within the law firm. 4 Q. In what role was that? 2 5 A. The investigative roles and the alcohol Page 34 1 know, having -- there were mixed reasons. For 2 example, I -- are you talking about my Fort Lauderdale 3 police detail? 4 Q. Yes. You had it at the office and at your 5 home, correct? 6 A. Yeah. There's a myriad of facts that 7 motivated me to do that. One was that 1 really wanted 8 the security for the office. Two was. I was paranoid 9 and this is in no particular order. Three was the 10 Melissa Lewis murder that shook the entire law firm 11 and shook me terribly. I didn't want that to ever 12 have to happen again. And four was, I wanted -- the 13 more law enforcement you have around, the 14 more legitimacy it adds to you and your appearance to 15 the community. So there were a multitude of reasons. 16 1 mean, I hired certain law enforcement to 17 work for me that were just friends of mine that 18 were -- that needed additional money, so l wanted to 9 make sure that they had money, both guys that did the 20 illegal stuff for me and guys that didn't do anything 21 illegal for me. 22 Q. Let's go back to the Epstein case and when 2 3 you decided to utilize it — to use for the investors 2 4 for your Ponzi scheme. 25 Do you recall approximately when it was that Page 36 1 beverage roles and anything else Ken or other staff 2 could think of to have them do. 3 Q. Let's talk about the investigative roles for 4 a minute. 5 What kind of investigations were these teams 6 running? 7 A. I do not know. You have to speak to lawyers 8 that were actually utilizing them. I put it out there 9 and Ken put it out there, that they were available to 10 lawyers in the firm for use like in-house 11 investigators. And what people did with them 12 ultimately was up to them. 13 Q. Were they on salary or were their costs and 14 fees associated with utilizing them within a specific 15 practice group? 16 A. They were all on salary with me. The 17 ultimate goal was to have it as a separate entity that 18 could bill the law firm and have the clients at least 19 defray some of the cost. 1 don't recall whether or 2 0 not we ever got to that level or not. 21 Q. With all that in-house police action, why 2 2 did you have police security surrounding you all the 2 3 time? 2 4 A. I guess the best answer was I was paranoid, 2 5 but I mean -- that's the simple answer to it. You Page 35 1 these investors were coming that you decided to use 2 the files? 3 A. My best recollection it was in 2009, 4 sometimes after April of 2009, but I don't have a 5 specific recollection beyond that. 6 Q. What makes you think it was after April of 7 20097 8 A. Because, to the best of my recollection, the 9 Clockwork Group came in towards the middle of 2009. 10 When I say Clocicworlc, that's an umbrella term that 1 11 use to mean the Von Allmen, AJ Discala, and other 12 investors that came in through that feeder fund. 13 Q. So that was around April 2009? 14 A. No, it was after, to the best of my 15 recollection. I mean, you can tell because all you 16 have to do is look and see when the first, very first 17 Clockwork investment is. Actually, you can pinpoint 18 it even closer. Look for the very rust settlement 19 deal that we did. that was related to the Epstein case, 20 within 60 days prior to that would have been when I 21 was meeting with those due diligence people, 30 to 22 60 days before that, 2 3 Q. So when you decided to use that case, take 24 me through exactly what you did to familiarize 25 yourself with that case. Page 37 10 {Pages 34 to 37) FRIEDMAN, LOMBARDI & OLSON 305-371-6677 5od93085-0554-4471-bcdd•ca2d81041d1 EFTA01130744 1 A. 1 talked to Russ Adler. I may have talke4 2 to some of the othedawyers. I flipped through 3 certain boxes in the file. 4 Q. How did you get the boxes? S A. I asked someone to bring them to me. 6 Q. Do you know where those files were stored? 7 A. I do not. 8 Q. So you flipped -- sorry, please continue. 9 Flipped through some files? 10 A. I flipped through some files. I had the 11 files in lily office. The day_that the investor group 12 came in, I actually had Ken Jenne and some others 13 actually bring me some more of the boxes actually into t 4 my office while the investors were there. I already 15 had some of the boxes with me. 16 Q. You say "Ken Jenne and others," who were the 17 others to whom you are referencing? 18 A. I don't specifically recall who carried them 1 9 in. I was very focused on my investors at that time. 20 Q. Were any of the lawyers present with you 21 when you were meeting with these investors9 22 A. During the actual meeting with them, no. I 23 recall that some of the lawyers may have met some of 24 the investors, but I don't recall who. 2 5 Q. Do you recall approximately when that Page 38 1 unrelated to this case, documents related_to the 2 settlements. Other than proving the existence of the 3 case, there's very little an investor, at least from 4 my end, investigates into the actual case.ILav 5 more after having the case exist and not caring about 6 really what was going on in the case other than a lqt 7 of money was going to be collected. 8 Q. Well, with respect to showing them that the 9 case existed and that there was a likelihood of a 10 possibility of a payday at the end, how did you 11 convince them of that? What did you use to convince 12 them of that? 13 A. I did two main things. One, I put the boxes 14 in my office while they were there. I told them to 15 specifically look at a couple of sheets of a flight 36 manifest that was in the file that Russ had shown me. 17 And I told them that it would be a breach of 18 attorney/client privilege for them to look at the 19 file, but that I was going to step out for a while and 20 leave them there with the boxes, wink, wink, and 21 that's what I did. 1 stepped out. I let them look at 22 whatever they wanted to look at. 1 came hack in, they 23 were satisfied that it was a real case and I was off 24 and running 25 Q. And these were the real legitimate files for Page 40 1 happened? 2 A. No, it's the same dates that I was giving 3 you before. 4 Q. Okay. So you had, to further your Ponzi 5 scheme, you had to familiarize yourself with this case 6 so that you could speak intelligently with the 7 investors; is that correct? 8 A. Well, sort of because most of what I told 9 the investors wasalLthings_that I was creating as I 10 ,WggL 11 Q. About this particular case, the Epstein 12 case? 13 A. Yes, from an investor .- you have to 14 understand how the inner working of the Ponzi scheme 15 were crafted but — 16 Q. Please tell me then. 17 A. I'm telling you hang on. From an 18 investor's standpoint, the investor is simply looking 19 for is the case believable. And once they get past 20 that, is it of such case -- excuse me, is it of such a 21 nature that it is possibklo_be generating a 22 significant amount of settlement dollars. And then 23 after that, their concern is simply on the due 24 diligence side of making wre we actually have the 25 money, that the documents pass — the documents Page 39 1 this casee• is that correct? 2 A. These were the legitimate files. yes. 3 Q. Nothing had been created at this time for 4 them to look through? 5 A. I didn't add anything to the case files. 6 The case files were significant enough 7 Q. Do you know how long they were in your 8 office; days, weeks? 9 A. The people or the boxes? 10 Q. The boxes. 11 A. The boxes were in there probably a little 12 more than a week. I don't have a specific 13 recollection. 14 Q. Okay. Did you ever go through them? 15 A. Yes, I flipped through them at some point in 16 time. 17 Q. And what do you recall about what you saw in 18 the cases? Do you remember anything? 19 A. I remember seeing the flight manifest. 1 20 don't recall seeing anythingelse. I'm sure I looked 21 at other things, but again, for my purposes it was 22 insignificant to me because the actual content of the 23 boxes was not necessary in the sale of the fake 24 settlements. 25 Q. Why was the flight manifest so interesting Page 41 11 (Pages 38 to 41) FRIEDMAN, LOMBARDI & OLSON 305-371.6677 5ed93085-0554-447f-bcddca2d81041df EFTA01130745 1 to you? 2 A. Because of who was on it. 3 Q. Who was on it? 4 A. I don't recall, but I do recall saying to S the investors -- I recall having a conversation prior 6 to the investors coming in with Ritss_Adler and Russ 7 had told me that Epstein had flown Bill Clinton on his 8 ,plane, had flown Prince Andrew on his plane. And1 9 don't remember whether that was on any of the lfight 10 manifests or not, but I left that to the investors' 11 imagination as to what they were being told about 12 Mr. Epstein and these other famous people that were 13 cavorting with Mr. Epstein and let them look at the 14 file. 15 You have to understand from an investor's 16 perspective -- hang on. From an investor's 17 perspective the only thing that matters to the 38 investor is_that it'snal_case and that they can 19 verify that real dollars are being paid. The fact 20 that it was a real case was evident, I had a lot of 21 boxes with real pleadinjs in it a d a lot of other 22 information in it. The fact that there was real money 23 being paid was a fiction that was created by me and my 24 co-conspirators, everyone from bankers, to computer 25 rats: So the actual role of the case, and I want to Page 42 1 A. 1 went back to selling the Ponzi deal 2 Q. And did you sell it? 3 A. I believe I did. You'd have to look at the 4 actual settlement documents to see if I put one 5 together for that, but I'm pretty sure we did. 6 Q. Do you recall if the investors asked you for 7 any additional information or any additional 8 documentation? 9 A. I don't recall one way or the other. 10 Q. After this initial meeting with the 11 investors, did you give any direction regarding this 12 particular case? 13 A. To whom? 14 Q. To any of the attorneys working on the 15 Epstein case. 16 A. No. 1 didn't interfere in how they were 17 running their cases. They were far more experienced 18 than 1 was in that type — in handling that twe qf19 case. As a matter of fact, I was practicing very 20 little real law at this point in time. I wouldn't 21 have had time to tell them or to get involved. 22 Q. Did you ever keep up with this case after 23 this initial meeting with the investors? 24 A. I'm certain that I talked to Russ Adler 25 about it from time to time, but my main focus by this Page 44 1 make sure you understand this, the actual ro