Legal Difficulties Loom for Judge John Rakowsky

Judge John Rakowsky Sued in Nevada

By Paul Gable

A month ago, we reported that Lexington attorney and chief magistrate judge John Rakowsky was a defendant in a lawsuit filed in Las Vegas, Nevada federal court, Case No. 2:12-cv-02161-GMN-CWH.

The lawsuit is for Breach of Contract, Breach of Implied Covenant of Good Faith and Fair Dealing, Intentional Misrepresentation and Conversion of Property. The Plaintiff is Center for Legal Reform (CLR), a Nevada Non-profit Corporation as successor in trust to Resolution Settlement Corporation (RSC), a former Nevada corporation, which provided expense funds to Rakowsky for a case called Southern Holdings.

The Nevada case has the potential to fully expose the South Carolina legal system as a good ole boys club that protects its own at the expense of the law, fairness and justice.

Rakowsky represented the plaintiffs in a civil action titled Southern Holdings et al v. Horry County et al, case number 4:2004cv22135. Funds from two other funding firms, LitFunding and Law Max are included in an interpleader action in South Carolina state court where Rakowsky is represented by Stephanie Weissenstein of the Law Offices of Desa Ballard.

However, the funds provided by RSC, LitFunding and Law Max, have never been fully accounted for. Additionally, RSC was never acknowledged as a funding source in the interpleader action, even though documents provided for the case clearly show a portion of its funding.

Here are the first and last pages of a contract, click (LawMaxContract), which clearly show Law Max was providing $35,000 to Rakowsky. On the last page, Rakowsky acknowledges prior funds received from LitFunding in the amount of $50,000 and RSC in the amount of $25,000. This acknowledgement does not include an additional $45,000 from RSC, which is included in the Nevada case.

Attached to a letter sent by Weissenstein to James Spencer, one of the plaintiffs in the Southern Holdings case, is an accounting of the funds submitted to the court, for the interpleader action, by Weissenstein on behalf of her client Rakowsky.

click (Confirmation-of-money-owed-to-Spencer-by-Rakowsky1)

As you can see, the accounting starts with deposits of $67,500 even though the amounts on the above Law Max contract clearly total $110,000 and the overall total with the full RSC amount is $155,000.

Rule 417 of the S.C. Judicial Department and Rule 1.15 of the South Carolina Rules of Professional Conduct require the date, source and description of each amount deposited to be included in the records. This is not done in the attached accounting provided.

Additionally, disbursements of various amounts are identified only by a name or purpose for each disbursement amount. The above referenced S.C. rules require the date, payee and purpose of each disbursement. This is not done either in the attached accounting.

Why did Weissenstein state in court click (Exhibits-N-Rule-11a-Motion-Part-2) a full accounting had been provided to Spencer?

Why did Rakowsky state to the judge he included all funding organizations click (Exhibits-O-Rule-11a-Motion-Part-2)?

Rakowsky’s accounting was also the subject of a letter from Nevada attorney Ron Serota to the South Carolina Office of Disciplinary Counsel. click (serota ltr to odc)

According to Serota, the ODC dismissed his complaint even though a cursory investigation would have demonstrated the above mentioned discrepancies.

Where is the missing money? Why has the S.C. legal system allowed Rakowsky and Weissenstein to provide incomplete records with numerous discrepancies and obviously inaccurate (or worse) statements on the record of court proceedings?

While the South Carolina court system has dismissed or ignored the discrepancies, the federal court in Nevada, far beyond the reach of the good ole boy system, is expected to demand answers.



  1. Perhaps we should use this to start cleaning up the crooked court system here in South Carolina and quit monkeying around.

  2. Lindsey your XAG buddy!!

    Johnny say it ain’t so…we are just going to have to get together and have one of our private sessions to work things out!!!! – Wink-

Leave a Comment