Hollywood fin-syn attorney Mickey Gardner has agreed to pay $ 350,000 to the government to settle a civil lawsuit alleging that he was paid too much to advise since-convicted S&L exec Charles Keating on potential broadcast acquisitions.
Under terms of the agreement imposed by U.S. District Court Judge Charles Richey, Gardner neither admitted nor denied guilt. However, Gardner said yesterday that he feels vindicated, since government attorneys had been hoping to win a $ 1.5 million judgment.
A spokeswoman for the Resolution Trust Corp., the agency that brought the lawsuit, also claimed victory. “We’re pleased with the amount,” she said, adding that it is “standard” for the RTC to settle a case for less than an amount initially sought.
Gardner, whose clients include Hollywood’s Coalition to Preserve the Fin-syn Rules and MCA Inc., said in a statement it was “far better for my family… to enter into this settlement instead of enduring another year of the RTC’s taxpayer-financed prosecution.
“For the creative community who dealt with McCarthy-era tactics of bad government, we can now much more fully appreciate that reign of terror after dealing with this government agency.”
Andrew Lipps, Gardner’s attorney, said his client settled out of court to avoid “protracted litigation fomented by the unlimited resources of RTC.”
The RTC was set up by Congress to recover money for taxpayers stemming from the collapse of many of the nation’s savings and loan institutions. The agency originally charged Gardner with four counts of impropriety in connection with a series of payments totaling $ 1.5 million made to Gardner by Keating’s Lincoln Savings & Loan in the mid-1980s. Three of the counts were dropped, including charges that Gardner breached legal ethics and his fiduciary duty as a lawyer.
An RTC spokesman said the agency was “unable to identify any services provided (by Gardner) to Lincoln.” Gardner countered by claiming he was paid for advice he offered Keating to invest in Gulf Broadcasting.
Keating’s American Continental Corp. turned a $ 50 million profit after investing in Gulf, per Gardner. In his statement, Gardner said former ABC Broadcasting exec Martin Pompadur was willing to testify that the consulting fees paid by Lincoln were “entirely reasonable,” while the RTC was unable to come up with witnesses to counter Pompadur’s claim.
Three members of the Federal Communications Commission — Ervin Duggan, Andrew Barrett and Sherrie Marshall — had expressed a willingness to testify on Gardner’s behalf.
Marshall claimed yesterday the RTC was “way out of line in its effort to get Mickey. When all is said and done, they probably spent more money going after him for a bogus ‘unjust enrichment’ charge than they ultimately received from the court-ordered settlement.”