Alito is Toast

Plaintiff alleges Alito conflict
Says judge should have recused self

By Sarah Schweitzer and Michael Kranish, Globe Staff
November 3, 2005

Judge Samuel A. Alito Jr. ruled in a 2002 case in favor of the Vanguard mutual fund company at a time when he owned more than $390,000 in Vanguard funds and later complained about an effort to remove him from the case, court records show -- despite an earlier promise to recuse himself from cases involving the company.

The case involved a Massachusetts woman, Shantee Maharaj, who has spent nearly a decade fighting to win back the assets of her late husband's individual retirement accounts, which had been frozen by Vanguard after a court judgment in favor of a former business partner of her husband.

...

Maharaj, 50, discovered Alito's ownership of Vanguard shares in 2002 when she requested his financial disclosure forms after he ruled against her appeal to the US Court of Appeals for the Third Circuit.

''I just started seeing Vanguard after Vanguard, and I almost fell to the floor," she said in an interview at the Jamaica Plain home she shares with a friend after losing her own home in the course of the prolonged litigation. ''I just couldn't believe that it could be so blatant."

In 1990, when Alito was seeking US Senate approval for his nomination to be a circuit judge, he said in written answers to a questionnaire that he would disqualify himself from ''any cases involving the Vanguard companies."

After Alito ruled in Vanguard's favor in the Maharaj case, he complained about her efforts to vacate his decision and remove him from the case, writing to the chief administrative judge of the federal appeals court on which he sat in 2003: ''I do not believe that I am required to disqualify myself based on my ownership of the mutual fund shares."

The White House, asked about the seeming contradiction between Alito's two statements, said that Alito was put on the case due to an error by a computer system that should have warned that he was taking a Vanguard-related case, because the investments were listed in the database.

Asked why Alito did not recuse himself after learning that it involved Vanguard, White House spokeswoman Dana Perino criticized those who are raising questions about Alito's actions.

...

According to a 2002 court filing submitted by Flym alleging the conflict of interest, ''Alito owned shares worth $390,000 to $975,000 in seventeen Vanguard funds."

http://www.boston.com/news/nation/washington/articles/2005/11/03/plaintiff_alleges_alito_conflict/

Welcome to DU!

banners and news flashes just don't do the gravity of these events justice (no pun intended).

:hi: :hi: :hi:

to be a member of the ruling class of the Republican Dirty Fighters Against The Common People.

one of THEM. :eyes:

Maybe it is because the hearings for his confirmation are so far off, but there doesn't seem to be much enthusiasm about opposing him. I hope I'm wrong - I don't want him.

He complained about being asked to recuse himself. How could not recusing himself be an oversight?

He, to me, is putting his own interest's first in this. It does matter and every Senator on the fence of voting for him (including "the gang of fourteen") should get this.

So the problem isn't that Alito stayed on the case; the problem is that people are asking why he stayed on the case.

How surprising, from this Whitehouse.

and no one seems that concerned with it. Go figure! :eyes: Of course if he were a Democrat there would be hell to pay but since he's a Republican, you know, the party of honesty and integrity, there doesn't seem to be a great deal of interest in this story.

Here's hoping it gets legs. BIG legs!

but isn't that just exactly what they're looking for?

What a PATHETICALLY FUCKING LAME EXCUSE!!!



ARRRRGGGGGGHHHHHHHH!!!!!!!!!!!!

newspapers ever look at what's out here?

but it is starting to be noticed
now

spread the word
you'll see what happens ;)

http://en.wikipedia.org/wiki/Conflict_of_interest

A conflict of interest is a situation in which someone in a position of trust, such as a lawyer, a politician, or an executive or director of a corporation, has competing professional and/or personal interests. Such competing interests can make it difficult to fulfill his or her duties fairly. Even if there is no evidence of improper actions, a conflict of interest can create an appearance of impropriety that can undermine confidence in the ability of that person to act properly.
...
Self-dealing, in which public and private interests collide, for example issues involving privately held business interests
...
The best way to handle conflicts of interest are to avoid them entirely.
...
Judges recuse themselves from cases when personal conflicts of interest may arise. For example, if a judge has participated in a case previously as some other judicial role he/she is not allowed to try that case. Recusal is also expected when one of the lawyers in a case might be a close personal friend, or when the outcome of the case might affect the judge directly, such as whether a car maker is obliged to recall a model that a judge drives. This is required by law under Continental civil law systems and by the Rome Statute, organic law of the International Criminal Court.
...
Generally, codes of ethics forbid conflicts of interest

Time to spin the Excuse - O - Wheel.

Can't stop it, just rock it, Armegeddonit.

are ya really gettin it

Give me all your lovin
Give me all you got

(haha)

Proves he's one of them. Now, get a story that shows he voted in favor of gay rights? Then he'd be toast.

about this or whatever else comes up.

Black is white, up is down....

had a picture up of Specftor and Spector's quote about whether it could be a problem..."It may...."

last night.....Let's see if I can find it....

I mean... could we wind up "Having our cake and EDITH too?"

(or someone just as crappy as the Edith's?)

Are the Edith's even worse than Alito?

Can we keep getting nominee's booted until 2008? :7

Do I ask too many lame questions? http://eliteleague.co.uk/forum/images/smilies/lol!.gif

Ok.. don't answer that last one.

Perhaps General Pinochet is available...?

Edith Clement is more moderate than Alito (although Clement is probably more conservative than O'Connor), and would be a definite improvement.

Edith Jones, on the other hand, is a WINGNUT BANSHEE, and she would be catastrophic proportions worse than Alito!

:popcorn:

I know a judge who refused to hear a case in which his former firm was a party (not the attorney for a party), and he had left almost six years before.

That has got to be against the code of conduct for judges.

In 1990, when Alito was seeking US Senate approval for his nomination to be a circuit judge, he said in written answers to a questionnaire that he would disqualify himself from "any cases involving the Vanguard companies."

"I do not believe that I am required to disqualify myself based on my ownership of the mutual fund shares."

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1914813

Democrats Press Court Designee Over Mutual Fund Case

By SHERYL GAY STOLBERG
Published: November 10, 2005
WASHINGTON, Nov. 9 - Laying the groundwork for a possible strategy of attacking Judge Samuel A. Alito Jr., Senate Democrats are ratcheting up their questions about the judge's failure to disqualify himself from a case involving Vanguard, the mutual fund company that managed his investments.

While Judge Alito, President Bush's choice for the Supreme Court, continued Wednesday to pay courtesy visits in the Senate, all eight Democrats on the Judiciary Committee sent a letter about the Vanguard case to Judge Anthony J. Scirica, who is chief judge of the United States Court of Appeals for the Third Circuit, where Judge Alito sits.

The letter asked for documents relating to the Vanguard case, including records of "any communication between Judge Alito and you, any other member of the court, or the court's staff" discussing a promise by Judge Alito in 1990, made in a Senate questionnaire submitted as part of his appeals court confirmation, to recuse himself from matters involving Vanguard.

Senator Harry Reid of Nevada, the minority leader, circulated a so-called talking points memo to fellow Democrats on Wednesday titled "The Alito Alert," raising questions about the Vanguard case.
(snip/...)

http://www.nytimes.com/2005/11/10/politics/politicsspec...

"Laying the groundwork for a possible strategy of attacking Judge" Alito.

The times should be all over this and instead, the lead is just that those ole Dems are thinking of making trouble...WTF!

This is why i don't read that rag anymore!

but it is red meat for the cable networks which have an insatiable appetite for scandal real or imagined.

:applause:

.... I have a hard time getting worked up over it. Yes, he said he'd recuse himself and he didn't - that is not good.

But there is a huge difference between:

1) owning shares in Vanguard, the company

and

2) owning shares of a mutual fund managed by Vanguard

The difference being that the likelihood of the value of these assets being affected by the outcome of this case is almost nonextistent.

Y'all do understand the difference, no?

In the 1990 questionnaire, Alito was asked how he would resolve potential conflicts of interest. He responded: I do not believe that conflicts of interest relating to my financial interests are likely to arise. I would, however, disqualify myself from any cases involving the Vanguard companies."



This is great stuff, but I'm not so confident it means he's toast. Here's hoping that Tuesday will stiffen the Dem's spines and a filibuster will keep him off the court?

I'm wondering if Tuesday will make the Repukes less likely to pull the nuclear option. They know now that they can't get away with the same sh*t forever.

also, including a sister's business.

Heard it on the way home tonight.

Let's kill Alito's nomination!

This is the perfect way to do it - attack his integrity and judicial ethics.

-Vanguard
-Smith Barney
-Sis's Law Firm

<http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=104&topic_id=5255510&mesg_id=5255510>

And remember: In addition to his lack of ethics and his broken vow to America, he's nuts.

In his dissenting opinion in Planned Parenthood v. Casey, 947 F.2d 682 (3d Cir. 1991), he ignored decades of binding precedent and tried to let the politicians re-write the Constitution to restrict a woman's right to make decisions about her own body. Here's an excerpt: "General evidence about the problem of spouse abuse ... concerning the dimensions of the problem, as well as evidence that battering occurs in all socioeconomic groups and is sometimes fatal..., while documenting the existence of a broad national problem, provides no basis for any estimate of what is relevant...." (Even Alito's colleagues on the Third Federal Circuit and the far-right judges of the Supreme Court saw the relevance of domestic violence to the issue of whether a woman needs to notify her husband if she wants to terminate a pregnancy.)

In his dissenting opinion in United States v. Rybar, 103 F.3d 273 (3d Cir. 1996), he ignored almost 70 years of cases which had clearly decided the scope of Congress's authority in order to reach the extremist conclusion that Congress lacks the authority to regulate private citizens' ownership of machine guns. Here's an excerpt:
"At issue here is another type of purely intrastate firearm possession, i.e., the purely intrastate possession of a machine gun.... If there are distinctions of constitutional dimension here, they are too subtle for me to grasp." (Let's be glad that this constitutional distinction was not too subtle for the other judges on the Third Federal Circuit and the Supreme Court to grasp. Do we really want a judge who cannot grasp the nationwide effect of machine gun ownership and, therefore, believes that Congress lacks the authority to regulate such matters?)

How about Judge Alito's dissenting opinion in Banks v. Beard, 399 F.3d 134 (3d Cir. 2005), where he tried to re-write the law so prisoners didn't have access to newspapers or family photos? Or his dissenting opinions in Sheridan v. Dupont, 74 F.3d 1439 (3d Cir. 1996), and Bray v. Marriott Hotels, 110 F.3d 986 (3d Cir. 1997), where Judge Alito gave a big judicial OK to racial and gender discrimination?

Of course, even the Republican-dominated court of appeals and Supreme Court thought Judge Alito's ideas were radical, out of the mainstream, and maybe a little bit crazy.

Just envision an America where each of these dissenting opinions by Judge Alito has become the universal law of the land.

STOP ALITO!

I don't really want this guy on the court either, but the Vanguard thing has no valence to the nomination.

Ownership of shares of a Vanguard fund is about the least conflict-creating investment imaginable. A hold-to-maturity owner of a 30-year Treasury bond would probably encounter greater a greater level of judicial conflict. A Vanguard fund investor has as much, maybe less, natural conflict of interest in anything as a person with an FDIC-insured savings account.

Alito may have chosen Vanguard as a custodian for his investments precisely for this reason. Or he may have just been a smart guy who understood that index funds, which Vanguard pioneered, beat 80% of professional portfolio managers over time (the domestic index funds do, anyway, and the international index funds are beginning to build their records) and that the lowest cost mutual funds always leave an investor with many more dollars than funds with exorbitant expense ratios that can eat hundreds of dollars of a small investor's money each year.

Granted, Vanguard does describe their company as "client-owned," but what that seems to mean is that the company isn't public, isn't owned by Sandy Weill, and isn't subject to pressures from shareholders to increase profits by jacking costs and cutting services. "Client-owned" seems to mean, in Vanguard's case, that Vanguard's fund-holders pay for the entirety of the company's operations, thus making management accountable only the clients.

I think Alito was right for not bothering to recuse himself where no conflict existed.

This law-blogger has some different ideas, but comes to the same conclusion (that the Vanguard "issue" goes nowhere with regard to Alito's nomination):

http://legalethicsforum.typepad.com/blog/2005/11/judge_alito_and.html

no longer program their computers to catch this conflict.

And if losing $400,000 in a law suit wasn't going to have any impact on their profitability or their ability to hire and retain the best portfolio managers, then Vanguard wouldn't have fought this case in the courts.

And, most importantly, cases aren't one-off events. An unfavorable outcome for Vanguard would set a PRECEDENT which could result in a series of unfavorable law suits that could be very costly for them.

Maybe Vanguard had a policy of freezing accounts under the slightest of pretenses to protect their assets. By having a federal trial court judge rule in their favor could help them on the road to having Federal appeals courts write opinions that end up being binding on judicial districts or the entire country which can really help them rip their customers off and ensure their profitability.

of substance or by the non sequitur.

Curiously yours,
1932

PS The short version of my post was asking you, if this is no big deal, why was this conflict considered an automatic disqualification, and why did it take a "computer glitch" to get him on the case in the first place? You really think that's a substanceless non sequitur?

But if you're going to ignore it, I'm going to bed right now.

be before it might influence their profitable management of their funds?

"And if losing $400,000 in a law suit wasn't going to have any impact on their profitability or their ability to hire and retain the best portfolio managers, then Vanguard wouldn't have fought this case in the courts."

The very idea of hiring and retaining "the best portfolio managers" is antithetical to Vanguard's history and philosophy. Vanguard's core business is predicated on the intrinsic worthlessness of "the best portfolio managers." Vanguard's largest fund is the flagship of "passive investing" i.e. "indexing" as opposed to "active management," i.e. "stock picking."

As far as magnitude of the case, Vanguard doubtless holds far more than $400,000 in their "mistakes" account.

That amount represents this percentage of assets under management 0.000053333%, that is 0.000000533333 without the percent sign.

Regardless of that, what did Vanguard as a whole (not its "owner" Alito) really have at stake in this case? From the legal link in my prior post:

Pathos notwithstanding, according to the district court opinion in this case, a Massachusetts court found that the plaintiff’s late husband, D. Dev Monga, had moved money from his business to his Vanguard account in an effort to hide assets from his creditors. The Massachusetts court appointed a receiver for Monga’s business, and it was the receiver who obtained an order freezing the Vanguard account to preserve the assets for distribution to judgment creditors. Vanguard complied with the orders of the Massachusetts courts, issued to prevent Monga from defrauding his creditors by appropriating entity assets to his personal account. That is another reason this case presents no real risk of an economic conflict--Vanguard was not trying to keep the plaintiff's assets for itself. It paid those assets to Monga's creditors, and the chance that Ms. Maharaj, his widow, would get money out of Vanguard was trivially low (meaning the suit's expected cost to Vanguard (apart from litigation costs) was essentially 0).

Think what you want, I don't care. But this matter won't sink Alito by a damn site. The "Vanguard issue" against Alito is a silly joke.

I don't want this fool on the court either, but Vanguard won't sink him.

(1) It's definitely a big deal. He was trying to help set a precedent that could potentially save Vanguard much more than just $400,000. It's absurd to think that losing cases of that size have no influence on the ability of Vanguard to effectively manage portfolios. If it costs little to manage funds, and if talented, well-paid professionals, and capital investment in technology and infrastructure wasn't important, there'd be a lot more huge, successful funds out there. Vanguard needs that money from that case and from the dozens or hundreds of other similar cases that could have cropped up if they lost that one. I can't believe you were accusing me of substanceless non-sequiturs. Your apologia for this action is a substanceless non sequitur to the realities of business management and economics.

Incidentally, I'd like to see a link to the actual case, rather than that interpretation of the case that you posted. If we're going to argue about the facts of the case (and not simply about the appearance of propriety) we should have the facts and not hearsay evidence. It's very possible that this case is about how much dilligence Vanguard has to apply before taking actions like one described. There's a cost to dilligence and it cuts into profits, and that's not even counting the cost of being responsible for negligence.

(2) I have to agree with you on the second point. However, I'm sure hoping that I'm wrong.

I can't believe you were accusing me of substanceless non-sequiturs. Your apologia for this action is a substanceless non sequitur to the realities of business management and economics.

This after having added three paragraphs to your original one-liner.

If it costs little to manage funds, and if talented, well-paid professionals, and capital investment in technology and infrastructure wasn't important, there'd be a lot more huge, successful funds out there.

How few huge funds do you imagine there are? And again, a profound misunderstanding of not only Vanguard but also of the fund industry on your part. I take it you're a Janus investor - so easily do you equate "huge" with "successful."

Incidentally, I'd like to see a link to the actual case, rather than that interpretation of the case that you posted.

I eagerly await your link. You seem to have the dirty low-down on this case, by your own estimation. I assume the link is at your fingertips.

Best to you,

s

Bush no longer has the consent of the governered-- he has NO MANDATE to pick anyone for any job.

and politicians can steal all they want!

to recruse yourself when you know you should.

They are nominating more and more right wing extremists
every time the current nominee withdraws.

Send this to Harry Reid and Ted Kennedy!

That's like no problem as far as the Republicans are concerned. Even though the Dems are feeling frisky, I really don't think they're up to a fillibuster. I really think this turd will be confirmed.

I won't be surprised if he withdraws his name.

This is a fairly egregious error of judgment, it's lying, and it's breaching his fidiciary duty, IMO. He had to recuse himself, and he didn't. But more importantly, there are Republican Senators who not vote for him.

This could be Miers II, the Sequel.

And then got a do-over to change his answer?

I hope he's toast!

(NOT a direct quote, simply from my memory):

"The criticism toward John Roberts and Harriet Miers may have been based in politics, but this information on Alito is simpler, fact-based..."

When criticism surfaced regarding Miers, Karl Rove sent Pickles in front of the TV cameras to call it "sexist." When details about Scalito's past surfaced, critics became "racist" for calling Italian-American Alito "Scalito."

For the record, I'm a proud Italian-American and I ALWAYS call Alito "Scalito," so Karl Rove can BITE ME.

Pretty hard to cry "PARTISAN!" in the face of a BROKEN PROMISE. A DOCUMENTED broken promise at that.

:patriot:

This alone brings serious questions to his integrity.

n/t

take this guy down-- let bush nominate another-- and let us Take that one out too--Bush no longer has the consent of the governered-- he has NO MANDATE to pick anyone for any job.

The three cases really add up to something. I sent info to Schumer's office (he's my senator).

He have to let the Senators know that a fillibuster is necessary and appropriate and that repugs vote for liars, deceivers and conmen!

That has to be the lamest excuse ever. He owned the fund during the trial, and there is no wiggle room here. Either he should have recused himself or he should not have. It's black or white. And I think the average person is going to have no problem figuring out which action was the correct one.

There is no way for him to gain by ruling in favor of Vanguard.

none of these republicans have any morals, scruples, or legal conscience.