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Bank Beat

Freedom of Information

Decision Of 2d Circuit in Velarde Invoked by Cravath Swaine Against Unpaid Worker At Phoenix House

By Matthew Russell Lee, Periscope video, II III

FEDERAL COURTHOUSE, February 6 – The wheels of justice turn slowly, but sometimes those of legal argumentation move at a faster clip. On February 5 the US Court of Appeals for the Second Circuit issued a ruling that a trainee suing the Salon Professional Academy of Buffalo, because they were the primary beneficiary of the program, could not sue for alleged violations of the Fair Labor Standards Act (FLSA) and Articles 6 and 19 of the New York Labor Law (NYLL). It's Velarde v. GW GJ, Inc., No. 17-330 (2d Cir. 2019).

On February 6 Judge Ronnie Abrams of the US District Court for the Southern District of New York, in the same Thurgood Marshall Federal Courthouse, held an oral argument centered on how this day-old decision impacted a case pending since 2014, against Phoenix House. Plaintiff Mark Vaughn, who proceeded initially in forma pauperis, complained Phoenix House made him work for free eight hours a day, six days a week, such that he missed therapeutic sessions.

Phoenix House, represented pro bono it seems by the white shoe law firm of Cravath Swaine and Moore argues that the work - sorting recycling moving boxes - was about life skills, not job skills. It's akin to the Good Samaritan defense, or the UN's excuses for not paying a penny for killing 10,000 with cholera in Haiti: we are doing God's work, if we have to pay it is not possible. But aren't the means supposed to be the ends? On the other hand the benefit to Vaughn was that he stayed out of jail by going to the Phoenix House in-patient program. But as free labor? We'll have more on this - and on this: while the US government seeks a way to draw down its military forces in Afghanistan, on February 6 the US Attorney for the Southern District of New York unsealed the indictment of, and presented in the SDNY, Afghan national Haji Abdul Sattar Barakzai a/k/a Manaf for allegedly supporting the Taliban with heroin imports and sales. Inner City Press, covering the SDNY - on this day, a sentencing for crack sales and two police brutality cases about to go to the jury - went the courtroom of the assigned judge, Paul Crotty, but it was locked. 

  Down in courtroom 5A they said, Manaf is finished, it was done. Here's from the arrest warrant: "From at least in or about January 2018, up to and including in or about September 2018, in Afghanistan and elsewhere, and in an offense begun and committed outside the jurisdiction of any particular state or district of the United States, HAJI ABDUL SATAR ABDUL MANAF, a/k/a "Haji Abdul Sattar Barakzai," the defendant, who is expected to be first brought to and arrested in the Southern District of New York, knowingly and intentionally did engage in conduct that would be punishable under Section 841(a) of Title 21, United States Code, if committed within the jurisdiction of the United States, to wit, the manufacture, distribution, and possession with intent to manufacture and distribute, of one kilogram and more of mixtures and substances containing a detectable amount of heroin, knowing and intending to provide, directly and indirectly, something of pecuniary value to a person and organization that has engaged and engages in terrorism and terrorist activity, to wit, the Taliban and its members, operatives, and associates, having knowledge that said persons and organizations have engaged in and engage in terrorism and terrorist activity, which activity violates the criminal laws of the United States, occurs in and affects foreign commerce, and causes and is designed to cause death and serious bodily injury to nationals of the United States while the nationals are outside of the United States."

Upcoming in the SDNY is a just-filed complaint by the Bangladesh Central Bank for the $81 million hacking of its funds, which were then wired through the Federal Reserve Bank of New York, a case that Inner City Press will cover. Times change. Watch this site.


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