Ryan fund ordered to supply $1 million

From The Chicago Tribune:

Ryan fund ordered to supply $1 million
Money would pay for any restitution

By Rudolph Bush
Tribune staff reporter
Published June 19, 2002

A federal judge Tuesday ordered Gov. George Ryan's campaign committee to place $1 million in a court-controlled escrow account after prosecutors complained hundreds of thousands of dollars were being bled from the fund to pay legal fees.

U.S. District Judge Rebecca Pallmeyer also stated she expects Ryan's committee to have new lawyers when it appears for a June 27 hearing on the government's request for continuing protection of the funds.

Pallmeyer previously ruled that Altheimer & Gray, the Chicago firm that has been representing the committee, has a conflict because it also is representing other defendants in the corruption case.

In the April indictment of Citizens for Ryan, which charged the committee with diverting state funds and resources to Ryan's 1998 gubernatorial campaign, prosecutors stated they are seeking $1 million in restitution for the secretary of state's office.

They became concerned last week that legal fees will leave the committee with no money to pay that restitution in case of conviction.

Attorneys for Citizens for Ryan have argued that a restraining order will inhibit the committee's ability to pay for its defense.

Mark A. Flessner, an attorney with Altheimer & Gray, said Ryan's committee hasn't been successful in seeking other counsel since June 10 when the judge decided the firm had a conflict.

"The issue has been money and the ability of Altheimer & Gray to stay and assist [future counsel]," Flessner said.

The firm has not definitively said it will appeal its disqualification, though Flessner said Tuesday he believes the ruling was incorrect.

And while the judge didn't issue a restraining order, the difference is negligible, he said.

"The government is bleeding [Citizens for Ryan] to death, basically imposing capital punishment," he said. "At some point, the client's not going to exist as we fight these trivial little fights."

According to Flessner, Citizens for Ryan has $811,000 in cash, $200,000 in escrow and $500,000 on retainer at Altheimer & Gray.

Legal fees and other bills totaling about $130,000 are outstanding, Flessner said.

After the committee puts $1 million in escrow with the court, it will have about $380,000 left to mount a defense.

Citizens for Ryan holds that's not enough to effectively defend itself, which its attorneys claim is a violation of its 6th Amendment rights.

Assistant U.S. Atty. Patrick Collins said that as of July 2001, Citizens for Ryan had $3.6 million, but legal fees to Altheimer & Gray have decimated the fund.

"Now they're complaining before the court, saying we don't have enough money," Collins said.

"There's never going to be enough money to litigate the case they want to litigate. They're crying foul, and it's just not right," Collins said.