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Lawsuit by Minuteman Spill Response Filed Against PA Attorney General Kathleen Kane

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A lawsuit filed by an environmental services company headquartered in Milton, PA against PA's anti-drilling Attorney General Kathleen Kane's office for their legal terrorization of the company and family members. Kane's office conducted a 13-month witch hunt and froze all of the assets of Minuteman, forcing the company into bankruptcy with the loss of over 100 jobs and revenue of nearly $50 million.

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Lawsuit by Minuteman Spill Response Filed Against PA Attorney General Kathleen Kane

  1. 1. UNITED STATES BANKRUPTCY COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA INRE: MINUTEMAN SPILL RESPONSEt INC. Debtor Case No. 4-14-BK-01825-JIT Chapter 11 Adversary Proceeding MINUI'EMAN SPILL RESPONSE, INC., Debtor-in-Possession No.: 2435 Housels RWl Road Milton, PA 17847 VS. AMY CARNICELLA, ESQUIRE 301S 1H Ave. Suite 430 Pittsburgh, PA 15222 ROBERT B. STEW ART.lll. ESQUIRE Deputy Attorney General 2515 Green Tech Drive State College, PA 16803 RICHARD M. BOSCO Chief of Police Borough of Lincoln 45 Abe'sWay Elizabeth, PA 15037 CHRISTOPHER M. ANTONUCCI c/o Office of the Attorney General 16th floor, Strawberry Square Harrisburg, PA 17120 COMMONWEALTH OF PA., OFFICE OF ATTORNEY GENERAL 16 fh floor, Strawberry Square Harrisburg,PA 17120 ADVERSARY COMPLAINT Case4:14-ap-00212-JJT Doc1 Filed09/03/14 Entered09/03/14 15:50:21 Desc MainDocument Page 1 of 107
  2. 2. This adversary action, commenced under Rule 7001, et seq., of the Federal Rules of Bankruptcy Procedure, arises under the 4tlt. 5111 and 14th Amendments to the Constitution of the United States, and under 42 U.S.C. §1983. Plaintiffseeks compensatory and punitive damages, interest, costs, attomeys' fees, and equitable relief in the form of a declaration that Defendants' instruction to freeze Plaintiff's bank accounts was unlawful, unauthorized and unoonstitutional, and an order for the Attorney General's Office to revoke that instruction and immediately release Plaintiff's funds. PARTIES 1. Plaintiff MINUI'EMAN SPILL RESPONSE, me. (hereinafter "Minuteman") is a corporation duly organized and existing under the laws of the Commonwealth of Pennsylvania, with its principal place of business located at 2435 Housels Run Road, Milton, Pennslvania 17847. 2. On April 18, 2014, Minuteman filed for protection under Chapter 11 of The Bankruptcy Code, and is presently a Debtor-in-Possession ("DIP"). 3. Defendant, AMY CARNICELLA, ESQUlRE, was, at all times relevant hereto, a Deputy Attorney General of the Commonwealth of Pennsylvania, and acting under color of state law. Her current address is 301 5111 Avenue, Suite 430, Pittsburgh, PA 15222. 4. Defendant, ROBERT B. STEWART, ill, ESQUIRE, is, and at all times relevant hereto was, a Deputy Attorney General of the Commonwealth of Pennsylvania, and the Deputy in charge of asset forfeitures, with his office address located at 2515 Green Tech Drive, State College, PA 16803. 5. Defendant, RICHARD M. BOSCO, was, at all times relevant hereto, a law enforcement official and an Agent of the Pennsylvania Attorney General's Office, and acting 2 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/0311415:50:21 Desc Main Document Page 2 of 107
  3. 3. under the color of state law. His current address is Chief of Police. Borough of Lincoln. 45 Abe's Way, Elizabeth, PA 15037. 6. Defendant, CHRISTOPHER M. ANTONUCCI, wast at all times relevant hereto, a law enforcement official and an Agent of the Pennsylvania Attorney General's Office, and acting under color of state law, with his office address located at Strawbeny Square, 16th floor, Harrisburg, PA 17120. 7. Defendants Camicella, Stewart, Bosco and Antonucci are sometimes collectively referred to as "Defendants" or "Individual Defendants. •• 8, Defendant, Commonwealth of Pennsylvania, Office of the Attorney General. is a Department of the Commonwealth of Pennsylvania with an office address located at Strawberry Square, 16 th floor. Harrisburg, PA 17120. JURISDICTION and VENUE 9. This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 151,157, 1331, 1334. and 1343. 10. Venue is proper in this Court pursuant to 28 U.S.C. § 1409, as this adversary proceeding arises in connection with the following case under title 11 that is pending in this Court: In re Minuteman Spill Response, Inc .. Debtor. U.S. Bankr, M.D.Pa., Chapter 11, Bankr, t 1. This proceeding is non-core within the meaning of28 U.S.C. § 157, and is related to a case under title 11, as set forth above. 12. PlaintiffIDebtor consents to entry of final orders and judgment by the bankruptcy judge. 3 Case 4:14-ap-00212-JJT Doc 1 Filed09/03/14 Entered09/03/1415:50:21 Desc Main Document Page3 of 107
  4. 4. ALLEGATIONS COMMON TO ALL COUNTS 13. At all times relevant hereto, Defendants, State actors, were acting under color of State law. 14. The Defendants' conduct deprived Plaintiff of rights secured by the 4tiJ , 5111 and 14thAmendments to the Constitution of the United States. 15. Plaintiff Minuteman, at all times relevant hereto, was engaged. in the business of providing environmental services, environmental management and environmental emergency services, including, but not limited to, site clean-up and restoration, hazardous materials stabilization and containment, waste transportation and disposal, container management, tank cleaning, Hazmat spill response and incident management, site clean-up, remediation and restoration, and related services. In addition, PlaintifIMinuteman provides transportation services in connection with these functions. 16. To carry out these operations, Plaintiff employed more than 100persons, most of whom were highly trained and certified, and Plaintiff owned and operated approximately 150 trucks and an additiona1100 large pieces of portable equipment. 17. Since 2001, Plaintiff Minuteman has been a PEMA State Certified Hazmat Response Team. 18. Between October 2010 and May 2013, Plaintiff generated approximately $49 million in revenue from the operation of its business. In 2012 alone, Plaintiff generated approximately $17.6 million in revenue, and in 2011 it generated approximately $21.4 million in revenue. 4 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03114 Entered 09/03/14 15:50:21 Oesc Main Document Page 4 of 107
  5. 5. 19. As of May 29,2013, Plaintiff had an outstanding reputation in the industry, and an increasing number of major companies were calling upon Plaintiff for its services and entering into contracts with Plaintiff for those services. 20. In connection with its work, PiaintiffMinuteman was required to contract with waste disposal sites, landfill facilities, and vendors supplying Minuteman with fuel for its vehicles and supplying machinery, parts and supplies, including Hazmat equipment and supplies, as well as other supplies required to maintain the operation of the business. 21. As of May 29, 2013, PlaintiffMinuteman~8 principal bank was M&T Bank located in Milton, Pennsylvania, into which bank Minuteman and related and affiliated companies deposited their receipts. Minuteman maintained a balance in various accounts in M&T Bank of between $600,000 and $1.5 million, necessary for payroll and daily operational expenses, including but not limited to, fuel for more than 150 trucks and other equipment, and for payment to landfill sites, all essential for the continuing operation of Minuteman's business. 22. Prior to May 29,2013, as part of their official duties, Defendants and/or their agents were in regular contact with officials ofM&T Bank and knew that M&T Bank was the principal bank in which Minuteman kept its deposits for operations, and Defendants were aware that access to the money on deposit in that bank was essential to the on-going operation of the business, as described hereinabove. 23. For some time prior to May 29,2013, the Pennsylvania Attorney General's Office bad conducted and directed a statewide grand jury investigation of Plaintiff Minuteman, purportedly seeking information on alleged "environmental and related crimes," with Defendants Bosco and Antonucci among the lead investigators, and with Defendants Camicella and Stewart directing the investigation. 5 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Desc Main Document Page 5 of 107
  6. 6. 24. On numerous occasions prior to May 29, 2013, Minuteman offered to cooperate with Defendants' investigation and volunteered to provide whatever information. records and materials Defendants requested. All such offers were rejected or ignored. 25. On or about May 29,2013, acting under color of state law, Defendants Bosco and Antonucci applied for and conducted, and Defendants Carnicella and Stewart directed, a series of searches and seizures of the assets and property of Plaintiff, Plaintiff's then-President, Brian Bolus, and Mr. Bolus's family. Specifically, Defendants executed Search Warrants on Minuteman and Bolus bank accounts at M&T Bank; on the Bolus family's personal investment accounts at the brokerage firm of Morgan Stanley; on the Bolus family' s residence in Lewisburg, Pennsylvania; and on the properties of Minuteman and its affiliated and related companies in Milton and Middleton, Pennsylvania. True and correct copies of the Search Wammts and accompanying Receipt/Inventories are attached hereto, made a part hereof; and marked as Exhibits ~'A"through "En as follows: Warrant for bank accounts at M&T Bank Exhibit '4A" Warrant for investment accounts at Morgan Stanley Exhibit "B" Warrant for Bolus family residence in Lewisburg, PA .•....... Exhibit "C" Warrant for Minuteman property in Milton, PA Exhibit "0" Warrant for Minuteman property in Middletown, PA Exhibit "E"l 26. It is believed and therefore averred that at the time Defendants applied for and executed the Search Warrants described above, the decision to prosecute Minuteman had already been made. 1 Social Security numbers, bank account numbers. credit card account numbers, and the name of the Boluses' minor son have all been redacted from 1I1eattached copies of the warrants and Receipt/Inventories. 6 Case4:14-ap-00212-JJT Doc 1 Filed09/03/14 Entered09/03/14 15:50:21 Desc Main Document Page6 of 107
  7. 7. 27. There was no Affidavit of Probable Cause attached to any of the Search Warrants. lnstead, pul'Buant to Defendants' request, the Affidavit of Probable Cause was "sealed," and was not released to Plaintiff's counsel until on or around August 8. 2014, more than 14 months after execution of the Search Wammts and attachment ofall oftbe above-described property. A true and correct copy of the Affidavit of Probable Cause is attached hereto, made a part hereof and marked 88 Exhibit "F," (Social Security numbers, bank account numbers, credit card account numbers, and the name of the Boluses' minor son have all been redacted from the attached copy of the Affidavit of Probable Cause.) 28. In the searches described above, Individual Defendants seized, inter alia, all of Minuteman's vehicles and equipment described above, having a value of approximately 12 million dollars, and also seized the titles to all of those vehicles and equipment 29. By letter dated May 30, 2013t M&T Bank informed Plaintiff that the Attorney General's Office had ordered the "freeze" of all of Plaintiff's accounts at M&T. A copy of the May 30, 2013 letter is attached hereto. made a part bereof, and marked as Exhibit "G." It was Defendants herein that gave, and/or authorized the giving of, that instruction to officials ofM&T Bank to "freeze" the bank accounts, 30. The M&T accounts subject to the freeze included approximately $100,000 in the Boluses' own personal accounts. 31. At Morgan Stanley, Brian and Karen. Bolus maintained their retirement accounts (both ERISA and IRA accounts) and also maintained a Section 529 educational account for their then-8-year-old son. When Defendants executed the Morgan Stanley Search Warrant they Instructed Morgan Stanley to freeze all of the money in the Boluses' retirement and Section 529 7 Case 4:14-ap-00212-JJT Doc 1 Filed09/03/14 Entered09/03/14 15:50:21 Desc Main Document Page7 of 107
  8. 8. accounts, totaling approximately $600,000, despite state and federal laws prohibiting execution on such accounts, even after a judgment 32. M&T Bank and Morgan Stanley both complied with Defendants' instructions and "froze" all accounts of Plaintiff Minuteman, Brian Bolus, Karen Bolus, and their then-8-year-old son, claiming they had no choice but to follow the Attorney General's Office's instructions. At the time of the freeze, Plaintiff Minuteman's operating account at M&T contained approximately $563,000.00, on which account at the time of the freeze, Minuteman had drawn and delivered some 54 checks totaling approximately $214,000.00 to vendors, creditors and suppliers of Minuteman, checks which had been issued in the regular course of business. As a result of the freeze, all of the aforesaid checks were dishonored, despite there having been more than sufficient funds to cover said checks, absent the "freeze." 33. In all, in connection with these Search Warrants, Defendants seized and/or "froze" assets with a total value of approximately 22 million dollars--a sum vastly in excess of what the Affidavit of Probable Cause could conceivably justify. 34. AlthoughtheDefendants and M&T Bank have since called the freeze an "administrative hold," the effect is the same - the Plaintiff was instantly deprived of its access to its money to operate its business. 35. The "freeze" was the equivalent to a taking of the funds in that Plaintiffwas deprived of the use of the funds immediately. 36. As a further result of the "freeze," M&T Bank. declared a default for. inter alia, non-payment by Minuteman of its monthly loan payments, which payments had theretofore never been in default, and which had been paid monthly without fail by a debit withdrawal from 8 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Oesc Main Document Page 8 of 107
  9. 9. Minuteman's account for the benefit ofM&T. Following the declaration of the default, M&T called OVCT S12 million in loans, all of which were at the time in full payment compliance. 37. As a further result of the freeze, Minuteman's then-President, Brian Bolus. was arrested and charged with the crime of having issued bad checks. The charges against Mr. Bolus were eventually dropped. 38. Following M&T's dishonoring of the checks, suppliers and vendors which had for years extended credit terms to Minuteman, discontinued terms and demanded pre-payment or C.O.D. payments; customers discontinued their dealing with Minuteman; and, in a matter of weeks. Minuteman's employee rolls went from more than 100 to approximately 60. Minuteman, which up to May 29, 2013 had been a highly successful business fur more than a dozen years, was on the verge of going out of business. 39. The freezing of the accounts brought about and ordered by Defendants, 88 well as the attachment and seizure of all of the company's vehicles and equipment. followed by the diminution in business and loss of key employees due to Minuteman's inability to operate effectively without credit, and the extreme damage to its credit caused by the dishonoring of checks, resulted in M&T Bank's squeezing Minuteman (its previously highly valued customer) for payment, which ultimately required Minuteman to seek protection under the bankruptcy laws. 40. Accordingly, and 88 a result of Defendants' conduct and M&rs complicity with the Defendants, on April 18, 2014, despite valiant efforts to survive without filing for bankruptcy, Minuteman had no choice but to petition for reliefunder Chapter 11 of the Bankruptcy Code. 41. Defendants' conduct constituted an unlawful seizure under the 4th and 141h Amendments to the United States Constitution, a deprivation of property without due process of 9 Case 4:14-ap-00212-JJT Doc 1 Filed09/03/14 Entered09103/1415:50:21 Desc Main Document Page9 of 107
  10. 10. law under the 5111 and 14thAmendments to the United States Constitution, and an unlawful taking of property without just compensation under the 5th and 14th Amendments to the United States Constitution. COUNT I Plaintiff v. Carnisella. Stewart, Boleo and Antonucci in their official and lndiyidual £fP.cities 42. Plaintiff incorporates the allegations in the foregoing paragraphs as if set forth herein. 43. If a search wammt authorizes the seizure of items as to which there is no probable cause, the warrant is overly broad and the resulting seizure violates the Fourth Amendment of the United states Constitution. See Klitzman. Klitzman & Gallagher v. Krnt. 744 F.2d 955, 960 (3rd Cir. 1984); United States v. Fautz, 812 F.Supp.2d 570. 603 (D. N.]. 2011). 44. In seizing and/or freezing all ofPlaintifrs assets, as well as the personal assets of Plaintiff's principal and his family, Individual Defendants conducted an unlawful search and seizure in that they knew at the time that there was no probable cause to justifY the breadth of the items seized and/or frozen. 45. Rule 201 of the Pennsylvania Rules of Criminal Procedure provides: "A search warrant may be issued to search for and to seize: (1) Contraband, the fruits ofacrime, or things otherwise criminally possessed; or (2) Property that is or has been used as the means of committing a criminal offense; or (3) Property that constitutes evidence of the commission of a criminal offense." 10 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered09/03/1415:50:21 Desc Main Document Page10 of 107
  11. 11. 46. Defendants used the aforesaid Search Warrants not for any proper, permissible or lawful purpose, but rather for the sole purpose of attaching money, pre-judgment, to be available in the event of: (1) an indictment; (2) a conviction; and (3) possible subsequent orders of fines or restitution - in other words, a pre-judgment attachment 47. At the time of the Defendants' preparation of the Affidavit of Probable Cause and their application for and execution of the Search Warrants, Defendants knew there was no lawful purpose for the wholesale seizure of all of Plaintiffs assets. The banks' records, Plaintiff's business records, and the Boluses' personal records, all of which were seized at the same time as the freezing of the accounts and the seizure of the machinery and equipment, provided whatever financial information or evidence Defendants conceivably could have required in connection with their investigation. 48. The freezing of the accounts, both business and personal, and the seizure of m.acbinery, trucks and equipment, was intended to stop Plaintiff from doing business, an improper use of a search warrant under the 4th and 14th Amendments and under the Pennsylvania Rules of Criminal Procedure. 49. Defendants never had any basis for believing or alleging that Plaintifl'ts entire business was a fraud, or that all of Plaintiff's revenues or assets were generated from unlawful activity, yet Defendants effectively seized and/or "froze" all of Plaintiff's assets and virtually all of the assets of Plaintiff's principal, Brian Bolus, and his family. 50. Under the Affidavit of Probable Cause, there was no conceivable way the seizure could be deemed reasonable or justified. Defendants knew there was no possible scenario under which the State could justify seizure of assets worth approximately 22 million dollars. Even if pre-judgment attacbment were an authorized purpose for a search warrant, which it is not, 11 Case4:14-ap-00212-JJT Doc1 Filed09/03/14 Entered09/03/14 15:50:21 Desc MainDocument Page 11 of 107
  12. 12. Defendants knew the seizure was excessive in the extreme, and that there was no likelihood that penalties, restitution or fines could approach 22 million dollars. 51. Individual Defendants knew that the searches and seizures in question were illegal, overbroad, and would cause irreparable harm to Plaintiff'. to Brian Bolus, and to Mr. Bolus's family. 52. The searches and seizures in question violated clearly established constitutional rights of which a reasonable public official would have been aware. 53. Despite the obvious overbreadth of. and lack of justification for, the seizures, Defendants opposed Plaintiff's requests for release of portions of the assets in question. further demonstrating Defendants' wrongful intent to cripple Plaintiff's business. 54. The freezing of the bank. accounts. along with M&T's complicity, resulted in M&T declaring a default on various M&T loans. including loans on Plaintiff's vehicles and equipment. When Plaintiff sought to liquidate vehicles and equipment to bring down the balance due on the loans or otherwise satisfy M&T's demands, Plaintiffhad to seek permission from the Attorney General's office for release of the vehicles and equipment from the grip of the effects of the seizure. 55. The direct and foreseeable effect of the seizures was to virtually destroy Plaintiff as a viable business, require Plaintiff to file for relief under the bankruptcy laws, and to prevent Brian Bolus and his family from carrying out their daily activities. The intention and effect was to seriously impede and hinder Plaintiff's ability to mount the enormously expensive defense against the government's forthcoming criminal charges. 56. On or about May 23, 2014, the investigating grand jury issued a Presentment against Minuteman and various affiliates, principals and employees. 12 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/14 15:50:21 Desc Main Document Page 12 of 107
  13. 13. 57. Knowing that the charges were never justified, just before the preliminary hearing. the government dropped no fewer than nine of the environmental charges that had been raised to support the Affidavit of Probable Cause. Even if all the alleged violations raised in the Affidavit of Probable Cause had been pursued, they still could never have justified fines or restitution in an amount remotely a.pproa.ching the sums that were seized or frozen before any charges were filed, before any hearing was held, and before any judgment was entered. 58. Defendants acted for improper and punitive purposes, intent on destroying Plaintiff's business for reasons of personal animus and political grandstanding, and, at a minimum, in reckless disregard of the consequences of their unlawful action. 59. Individual Defendants' conduct set forth above constituted violations of the 4th, Sth and 1401 Amendments to the United States Constitution. 60. Theseizureof over $500,000 in the Boluses' retirement funds at Morgan Stanley and of their 8-year-old son's Section 529 educational account constituted violations of ERISA, 29 U.S.C. § l056(d)(1), and 24 P.S. § 6901.309.2(a), respectively. 61. Given the purpose and scope of the Search Warrants, and the manner in which they were used, in conjunction with the freezing of accounts, Defendants abused the authority granted to state officials to seek such warrants exparte. 62. AI:. a result of Individual Defendants' conduct described above, Plaintiff Minuteman suffered losses of past and future profits estimated to be in a sum in excess of 20 million dollars. 63. As a result of Individual Defendants' unlawful conduct set forth above. Plaintiff suffered damage, including, but not limited to, the following: 13 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/0311415:50:21 Desc Main Document Page 13 of 107
  14. 14. (a) Loss of existing contracts with numerous companies, including immediate tennination by one company where more than 30 employees of Minuteman were engaged, and with a loss of revenue to Minuteman of $500,000.00 per month; (b) Damage to reputation with local landfills, gasoline suppliers, and other vendors, most of whom required payment C.O.D. as opposed to on terms, making it difficult and extremely costly to obtain the required supplies, or to dispose of waste materials at a price which would allow Minuteman to realize a profit; (e) Difficulty in making payroll, causing the loss oftecbnically trained and experienced employees and important supervisory personnel, and making it difficult to impossible to take on new business; (d) Being required to sell trucks and other required equipment to meet the required loan payments, further lessening Minuteman's capability of providing services as demand required, while simultaneously being obstructed from being able to liquidate these assets to payoff indebtedness; (e) Increasedinterest and bank charges; (f) Damage to credit with vendors, suppliers, and other third parties; (g) Loss of future business. caused by all of the above; (h) Being required to seek protection under Chapter 11 of the Bankruptcy Laws of the United States, which in turn caused further damage to Plaintiff's business, profits and reputation; and (i) Attorneys' fees incurred in attempting to challenge and reverse the unlawful conduct set forth above. 14 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Desc Main Document Page 14 of 107
  15. 15. 64. Individual Defendants' conduct was outrageous. willful, malicious, and in reckless disregard for Plaintiff's rights, warranting an award of punitive damages. WHEREFORE, Plaintiff demands judgment against Individual Defendants Camicella, Stewart, Bosco and Antonucci, jointly and severally, in their official and individual capacities in a sum in excess of 20 million dollars, plus interest. attorneys' fees, and costs, plus punitive damages. COUNT II Plaindffv. CamiceDa. Stewart. Bosco and Antonucci in their official and individul sapasities 65. Plaintiff incorporates the allegations in the foregoing paragraphs as if set forth herein. 66. The sole and avowed purpose of the freeze order directed by Individual Defendants was to obtain "security" in the event a prosecution were to come about and monetary orders (fines, penalities, restitution) were to be imposed, at the end of a trial if Minuteman were. in fBct. indicted and then were found guilUr. 67. Theinstruction by Individual Defendants and/or their agents, to "freeze" the Plaintiff's accounts, was not sanctioned by any statute or role of law. 68. The freeze of the accounts in conjunction with; or exclusive of, the search warrant, was ordered and carried out by the Individual Defendants in this case, inter alia, for the avowed purpose of accomplishing a "pre-judgment" execution, that is, to isolate assets, so that, if the Attorney General's prosecution were successful and restitution, fines, or penalties were ordered, the money would be available to satisfy any such orders. 69. A search warrant may not be used for such a purpose, and constitutes a deprivation of property without due process and a violation of the 4th. 5th & 14thAmendments to 15 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Desc Main Document Page 15 of 107
  16. 16. the Constitution of the United States. Nor can an official of the State Government order such a deprivation, with or without a search warrant. 70. If the Individual Defendants wished to accomplish a "pre-judgment attachment" of funds, they were required to provide Plaintiff with prior notice and hearing. See. Goldberg v. Kelly, 397 U.S. 254, 267 (1970); Montafiez v. Beard, 344 Fed.Appx. 833, 835, 2009 WL 2873196 at .1 (3M Cir. 2009); Hale v. Beard, 168 Fed.Appx. 532, 533,2006 WL 460895 at *1 (3 M Cir. 2006). 71. Individual Defendants' order to M&T Bank to freeze PIamtiffMinuteman's accounts, done under color of State law, was a violation ofPla1ntiffMinutem8n's right not to be deprived of its property without due process of law, 8 right secured by the Constitution of the United States. Individual Defendants were not authorized to order a freeze of Minuteman's accounts under any circwnstances, but at the very least Due Process of Law required that Plaintiff Minuteman be provided notice and be given a pre-seizure (pre-deprivation) hearing prior to Defendants' ordering a freeze of Minuteman's business accounts. 72. At the time of the IndividualDefendants' unlawful parol instruction to :freeze Plaintiff 8 accounts at M&T Bank, there was no Grand Jury Presentment, Indictment, Order of Restitution, Order to Pay a fine, or Order by any court of competent jurisdiction to "freeze" any of Plaintiff's accounts at M&T Bank, nor had there been a hearing to determine the propriety of freezing the funds in the accounts, as required by the 5th and 14thAmendments to the Constitution of the United States. See, Goldberg v. Kelly, 397 U.S. 254, 267 (1970); Montanez v. Beard, 344 Fed.Appx. 833, 835, 2009 WL 2873196 at *1 (3M Cir. 2009); Hale v. Beard, 168 Fed.Appx. 532. 533, 2006 WL 460895 at *1 (3Jd err. 2006). 16 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/14 15:50:21 Desc Main Document Page 16 of 107
  17. 17. 73. No Pennsylvania Statute authorized the freezing of a bank account, pre-judgment or conviction, with or without a hearing, as part of a statutory scheme in connection with my of the crimes being investigated by the Grand Jmy. 74. In connection with the crimes being investigated and ultimately charged against Plaintiff Minuteman, no Pennsylvania statute or Court Ru1e authorized the seizure of funds in a bank account before the entry of an order of court, following a hearing where Plaintiffwou1d have the opportunity to defend and present evidence. 75. Given the unauthorized purposes of the Search Warrants, the Search Warrants could not be used to circumvent the Constitutional right to a pre-deprivation hearing in connection with the freezing of one's bank accounts, nor may a search warrant be used pre- conviction, as a substitute for a duly ordered injunction and order to freeze, following a hearing at which the justification and necessity for such an order would have to be established by the State, and the property owner would have the opportunity to defend and be heard, 76. ffthe Individual Defendants sought infonnation on the amount in the accounts, dates of deposits, source of deposits, expenditures, cancelled checks, etc., it was not necessary to freeze Debtor's accounts to obtain such evidence because the evidence was reflected in the bank records. In fact, such bank records were seized under the same warrant. 77. The effect of the "freeze" order, even before indictment, was to seriously hamper Debtor's ability to defend itself. a further consequence of the unlawful freeze order initiated and carried out by Individual Defendants. 78. At all times relevant hereto, Plaintiffhad a substantial interest in unobstructed and unfettered access to its funds. 17 Case 4:14-ap-00212-JJT Doc 1 Filed 09f03f14 Entered 09/03/1415:50:21 Desc Main Document Page 17 of 107
  18. 18. 79. A post-deprivation hearing is inadequate under the circumstances because immediate and irreparable harm occurs to an ongoing business soch as Minuteman as a consequence of the freeze - inter alia, dishonoring of checks; immediate damage to credit; 108s of payment terms with vendors; loss of business reputation; loss of customer confidence in the company's credit; damage to relations with suppliers, customers and contractors; incurring of liability to third parties; 10s5 of business liquidity; and loss of employee confidence. 80. There was no justification for the seizure of virtually all of Plaintiff's property. 81. The seizures obstructed and interfered with, and continue to obstruct and interfere with, Minuteman's ability to operate its business. 82. Plaintiff's constitutional rights as described hereinabove were clearly established constitutional rights at the time Individual Defendants engaged in the conduct described above. 83. As a result of Individual Defendants' unlawful conduct set forth above, Plaintiff suffered the damage set forth in Count I above. 84. Individual Defendants' conduct was outrageous, willful, malicious, and in reckless disregard for Plaintiff's rights, warranting an award of punitive damages. WHEREFORE, Plaintiff demands judgment against Individual Defendants Carnicella, Stewart, Bosco and Antonu.cci.,jointly and severally, in their official and individual capacities in a sum in excess of20 million dollars, plus interest, attorneys' fees, and costs, plus punitive damages. COUNTDI Plaintiff v. Commonwealth of Pennsylvania, Offiee of the Attorney General Declaratory and InJunctive relief 85. Plaintiff incorporates the allegations in the foregoing paragraphs as if set forth herein. 18 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Desc Main Document Page 18 of 107
  19. 19. 86. The sum of approximately $340,000 from Plaintiff's accounts remains frozen at M&T Bank as a result of Defendants' unlawful instructions set forth above. 87. To this day there has been no order of restitution, fine or penalty against Minuteman. 88. The $340,000 was :frozen in violation of Plaintiff's rights under the 4th, 5 th and 14thAmendments to the United States Constitution, as set forth above. 89. The $340,000 constitutes property of Debtor's Estste under 11 U.S.C. § 541. 90. For the foregoing reasons. the instmction of the Attorney General's Office to M&T Bank to freeze Plaintiff's accounts was unlawful, unauthorized, and unconstitutional. WHEREFORE, Plaintiff respectfully requests that this Honorable Court: (a) declare that the instruction of the Attorney General's Office to M&T Bank to :freeze Plaintiff's accounts was unlawful, unauthorized, and unconstitutional; and (b) order the Attorney General's Office to revoke and rescind that instruction and to immediately release the $340,000 to Debtor's Estate. GILBERT B. ABRAMSON & ASSOCIATES, LLC Is! Gilbert B. Abramson GILBERT B. ABRAMSON Pa. Bar 1.0. #02395 One Presidential Blvd. Suitc315 Bala Cynwyd, PA 19004 610-664-5700 (tel.) 610-664-5770 (fax) DATE: 9-3-14 Attorneys for Plaintiff 19 Case 4:14-ap-00212-JJT Doc 1 Filed 09/03/14 Entered 09/03/1415:50:21 Desc Main Document Page 19 of 107

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