NNATE: Katie beats a (legal) dead horse, while Loony Lenny rants on

I've modified some of the text in this post to clarify some points about the Court of Appeals decision.
~ CC, 18 January 2017
 
As you may know if you've been following this blog for a few years, one of my favorite slogans, and a constant theme that runs throughout many of the posts, is: "No neat and tidy endings," or NNaTE, as my friend Julie Daniel abbreviates it. In Scamworld, as in most of real life, there are very rarely neat endings to any story, or to any scam as the case may be. Some stories and scams just go on and on and on.

So perhaps a group of three appellate court judges were being a tad optimistic when they began their December 29, 2016 opinion, regarding some business interests of imprisoned serial scammer Kevin Trudeau (aka KT, aka Katie) with the suggestion that their decision marked the close of a very long chapter. As the Chicago Tribune reported earlier this month:

Even getting sent to prison for a decade in 2014 by a Chicago judge for lying didn't shut the smooth-talking pitchman up, or put an end to his seemingly inexhaustible legal battles.

But now — 18 years after he was first pursued by the Federal Trade Commission for his fraudulent claims — Trudeau's case is finally toast, U.S. Court of Appeals judges are praying.

"This decision marks the end of litigation about Kevin Trudeau's frauds — or so we hope," Seventh Circuit Judge Frank Easterbrook wrote in an opinion published last week.

The decision wasn't whether or not to keep Katie in prison, where he is serving ten years on charges of criminal contempt related to deceptive claims in infomercials for his diet book, Weight Loss Secrets They Don't Want You to Know About. That conviction and sentence have already been appealed, and he lost the appeal last year around the time of his birthday, as reported on this blog.

Never a quitter, Katie took his fight all the way to the Supreme Court of the United States -- or, rather, he tried to. That was a wash too. As far as I know, SCOTUS didn't even bother with an explanation as to why they didn't care to hear his case; they just issued this:

But the December 29 decision concerned one of Katie's dozens of companies, Website Solutions, which along with his other assets whose existence was known to the court, was put under receivership in 2013. At some point Website Solutions hired their own law firms to represent it in responding to Federal Trade Commission (FTC) demands to turn over business records, and those firms later demanded that they be paid from the receivership funds. The district court determined that because Website Solutions was, as the business records revealed, indeed part of Trudeau's assets and therefore subject to receivership, any and all profits from that business must be used for restitution to the customers who'd been scammed by the weight-loss book.
 
After the receiver had collected about $8 million it submitted a plan to the district court to distribute the funds to victims. The court approved the distribution plan, and also determined that Website Solution's law firms -- Hogan Marren Babbo & Rose, Ltd.; and Faruki Ireland & Cox, P.L.L. -- were not entitled to compensation from the receivership estate. All that money was slated to go to victims, not lawyers. The law firms appealed the denial, and their appeal was in turn denied on December 29.

I found it amusing that the appellate judges also suggested a couple of strategies that Website Solutions' law firms might have used to at least give themselves and their client a fighting chance. From Bloomberg BNA's January 5 article on the matter:

The court noted that neither the firms nor Website Solutions sought court approval for the firms’ engagement or their “proposed course of conduct,” and that ultimately their actions were more obstructive than helpful to the receiver’s efforts.

The court also pointed out that the firms may have sought recovery of fees related to complying with the receiver’s discovery requests under Federal Rules of Civil Procedure, Rule 45(d)(3)(C)(ii). That section permits a court under certain circumstances to order reasonable fees for complying with a subpoena request.

Some folks sure waste a lot of money on lawyerly incompetence; have you noticed? When it happens to good people that's an outrage, but when it's a scammer whose money is squandered, it's really kind of funny..

From the Caselaw site, here is a link to the text of the December 29 decision.

And if you'd like a PDF, here's a link to that.

You can of course find links to many earlier Katie legal documents on this very Whirled -- docs related to his civil, criminal, appeals, and bankruptcy cases -- but if you don't feel like wading through old blog posts, try this link to find previous documents related to Trudeau's appeals. Just search for "Kevin Trudeau" and you'll find a few decisions that in their own way helped pave Katie's road to Federal sleepaway camp.

I should note, as I have on previous posts, that whether it has finally come to a close or not, the entire 18-plus years of legal actions by the FTC (and, later, the U.S. Attorney) against Kevin Trudeau were for various and sundry frauducts and flopportunities, but not for the biggest scam of all, the Global Information Network, or GIN. As I've written before, thousands of people were bilked out of millions of dollars during GIN's heyday, and although a reading of some of the many court documents makes it pretty obvious that Trudeau's actions regarding GIN had some influence on the judges' decisions, the court actions that sent Trudeau to prison were not directly related to GIN at all. People who were scammed by GIN and unable to get a refund a few years ago, but are still expecting some sort of compensation, will probably have a long, long wait.

Of course this doesn't mean that there won't be any lawsuits about Katie's mega-scam, so for that and other reasons those circuit judges were justified in adding, "or so we hope," to their speculation that their decision marked an end to Trudeau-related litigation. For if there's one thing you learn on this beat, it's that you just can't keep a good scammer down, and indeed the Chicago Trib article I linked to above noted as much:

On Facebook last week, Trudeau's backers continued to solicit donations to his legal defense fund from his 29,000 followers, promising them they could "DOUBLE YOUR MONEY."

And in a pre-Christmas message presumably relayed through supporters from his cell at the Montgomery, Alabama federal prison camp, Trudeau told his fans he would "share 2 secrets that will give you success in every area of your life."

If they followed his advice, the convicted fraudster, formerly of Oak Brook, wrote, they would "vibrate frequencies that will allow you to create the life you want."

The article also mentioned Trudeau's boasts about predicting Donald Trump's victory, a matter that I wrote about last July (back when there still seemed to be a chance that Trump might lose). The Trib writer duly noted that Trudeau had written that he was confident about a Trump victory because "the overwhelming energy of the people is consistent with Trump's vibration."

Not this people, I hasten to add, and not tens of millions of other people, but I quibble. Not surprisingly many of Trudeau's fans are also Trump fans, and some have expressed hopes that Trump will pardon Trudeau once he gets in office. The Trib writer noted that one of the folks on the short list for Trump's Supreme Court pick is none other than Diane Sykes, one of the judges who signed off on the December 29 decision. Of course that doesn't rule out a presidential pardon. Turds of a feather, you know...

And speaking of not being able to keep a good scammer down, you can't keep an incompetent one down either. On a January 4, 2017 post on Katie's Facebook page, one of Katie's surrogates wrote:

Kevin has a legal right to a defense fund. The Law firm that has been defending him is Winston and Strawn LLP. Proceeds from the fund go directly to the LAW FIRM.

As you can see either by following the link above or looking at the screen grabs below, a few folks responded, mostly with words of support, on the day the post was published, or shortly thereafter.



But early today (January 16), little Lenny Coldwell, cancer quack, fraudster and bigot extraordinaire, jumped in (under one of his phony names, "Eyn Rand") to slam Katie and promote himself, repeatedly and semi-literately.


FYI, Lenny can't write under his main Facebook profile at the moment because once again he has been suspended for hate speech. But as he often does, here he demonstrates the old saying about pots and kettles. And once again... NNaTE.