Cook Sheriff: Backpage, attorneys owe Cook County for 'hoax' suit over sheriff's credit card squeeze
Friday, April 27, 2018
Cook County Record
by Scott Holland
Cook County Sheriff Tom Dart wants a federal judge to penalize Backpage.com for its conduct in ongoing litigation between the online classifieds site and the sheriff’s office, particularly in light of a recent plea deal from a top executive related to sex trafficking through the site.
Dart filed a motion April 26 in Chicago asking U.S. District Judge John J. Tharp Jr. to require Backpage.com LLC and its attorneys to pay the county for its legal fees in connection with a legal battle that dates back to 2015, when the Dallas-based online classified advertising site obtained a preliminary injunction blocking the sheriff’s office from working to discourage credit card companies from processing payments for the site.
Cook County Sheriff Tom Dart
Dart said he and his staff were targeting Backpage because the company allegedly didn’t do enough to help police purge advertisements from its site linked to sex trafficking.
In late 2017, Backpage had asked the court to order sanctions against Dart, for allegedly attempting to wrongly conceal documents and communications under the alleged guise of attorney-client privilege. Dart, however, responded in January with a motion arguing Backpage was simply attempting to distract from the case that law enforcement around the country were building against it.
In the sheriff's offices April 26 motion, Dart said Backpage admitted on April 5 — in a federal plea agreement from Backpage CEO and owner Carl Ferrer — that “its entire First Amendment civil rights case was based on untrue facts from the beginning, and thus a hoax, a fraud on this Court, a fraud on the Seventh Circuit Court of Appeals and a fraud on the United States Supreme Court.”
The motion also accused Backpage of squandering taxpayer resources “under the guise of a civil rights plaintiff in its phony lawsuit, simultaneously fighting off the advances of law enforcement so that it could continue to make hundreds of millions of dollars from its enterprise that admittedly facilitated and promoted prostitution and child trafficking.”
Dart liberally cited Ferrer’s plea, in which he acknowledged “the great majority” of the advertisements in question were for prostitution services and therefore illegal in 49 states. He also said he “conspired with other Backpage principals … to find ways to knowingly facilitate the state-law prostitution crimes being committed by Backpage’s customers” and acknowledged “an overall, company-wide culture and policy of concealing and refusing to officially acknowledge the true nature of the services being offered in Backpage’s ‘escort’ and ‘adult’ ads.’ ”
The motion also pointed out that even if Backpage’s lawyers — Schiff Hardin, of Chicago; Henze, Cook & Murphy, of Phoenix; and Davis Wright Tremaine, with offices in Seattle and Washington, D.C. — didn’t know the truths underlying Ferrer’s plea, “they were presented with an abundance of opportunities from very early on in this case to know that their client was lying to the Court about the critical issues. They then either learned of these lies but did nothing or stuck their heads in the sand.”
Dart laid out a timeline explaining various points at which Backpage’s lawyers should have learned the company “was lying to the court,” starting with a June 19, 2015, interview the U.S. Senate Permanent Subcommittee on Investigations conducted with Backpage general counsel Elizabeth McDougall during which she wouldn’t “answer critical questions regarding Backpage’s procedures for screening for illegal content.”
The chronology included Sept. 26 and Dec. 23, 2016, California indictments of Ferrer that revealed “direct evidence” of Ferrer’s lies, and continued into September 2017 when Dart sought subpoenas for evidence — discovered in the Philippines in an unrelated case — of Backpage’s engagement in criminal activities.
In addition to seeking legal fees, Dart asked the court to allow limited discovery, to conduct an evidentiary hearing on sanctions against Backpage’s attorneys and permit “supplemental briefing on the appropriateness and amount of sanctions.”
Dart is represented by the firm of Kozacky Weitzel McGratch P.C., of Chicago.