Stephanie Weissenstein and Desa Ballard
A S.C. Hotline, Grand Strand Daily Exclusive
By Paul Gable
It came to my attention recently that Stephanie Weissenstein, attorney for John Rakowsky, sent to the Court copies of two articles from Grand Strand Daily along with a letter dated January 9, 2012. While I appreciate Ms. Weissenstein making the court aware of the articles, I do question the logic stated in her letter.
In the letter, Weissenstein refers to the articles as “this slanderous campaign in effort to intimidate and harass my client and me, while also smearing the Courts.”
First of all, surely Weissenstein understands that the articles would fall under laws of libel, not slander, if she could ignore or negate the first amendment and prove malice aforethought. Second, her claims of intimidation, harassment and smearing fall apart when the facts included in the articles are considered.
Rakowsky represented the plaintiffs in a civil action titled Southern Holdings et al v. Horry County et al, case number 4:2004cv22135. He is now engaged in an interpleader action, represented by Weissenstein and Desa Ballard regarding the funds remaining from deposits that were made for litigation expenses in the 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 by Weissenstein on behalf of her client Rakowsky.
The initial deposit shows $67,500. Reduced from this are unsubstantiated expenses totaling $57,644,15, leaving a balance of $9885.85 due to Spencer.
However, the agreement with LawMax, clearly shows Rakowsky received $35,000 from LawMax and that he acknowledged prior funds received from Lit Funding in the amount of $50,000 and Resolutions Settlement Corporation (RSC) in the amount of $25,000. Those three fund amounts total $110,000 received by Rakowsky to help in moving the case forward.
The obvious question is where is the missing $42,500 (difference between $110,000 obtained by Rakowsky and $67,500 admitted to by Rakowsky and his attorney in the accounting)?
In addition, why did Weissenstein state, on the court record of a September 15, 2011 court hearing on the interpleader, that an accounting has been provided to Spencer (Exhibits N) and Rakowsky state to the judge he included all funding organizations (Exhibits O)? Obviously the accounting provided to the Court and Spencer is, at best, flawed and, at worst, false!
It has also recently come to my attention that the issue of Rakowsky’s misuse of funds was included in a complaint Ron Serota submitted without knowledge of the clients to the South Carolina Office of Disciplinary Counsel (ODC) of the South Carolina Supreme Court in September 2007. Serota is an attorney from Las Vegas who also worked on the Southern Holdings case with Rakowsky. Serota said he became suspicious of personal misuse of funds by Rakowsky.
In a recent telephone conversation, Serota said he received a letter from the ODC stating an investigation found no wrongdoing on the part of Rakowsky. According to sources, it is believed that Serota’s letter and the ODC finding were wrongfully submitted in secret (ex-parte) to the Court in the interpleader case. The questions are how, why and who submitted these secret Supreme Court documents considered important enough to be submitted ex parte to the presiding judge and who made the decision?
The documents linked with this article clearly demonstrate that the accounting of litigation funds provided to the court is, indeed, flawed. Further, they demonstrate that the ODC of the South Carolina Supreme Court either did not investigate Serota’s complaint at all, or ignored the obvious discrepancies and misuse of funds.
It certainly seems there is sufficient evidence to question where the missing $42,500 went, why it has been ignored to this point and why the Courts will not allow his former clients to know what happened to the missing funds!
Paul Gable is a veteran investigative reporter residing in Horry County, South Carolina and is the current editor of the Grand Strand Daily an online magazine featuring all things local and political.