The United States Court of Appeals for the District of Columbia Circuit today unanimously reversed a trial court’s ruling dismissing a fraud case brought against the Council on American-Islamic Relations (CAIR). The result of the appellate court’s ruling is that CAIR National, operating out of the District of Columbia, must stand trial and allow a jury to hear all of the evidence of the massive fraud and attempted cover up carried out by CAIR and perpetrated against hundreds of CAIR fraud victims.
In January of last year, Judge Paul Friedman, the federal judge presiding over a five-year old lawsuit alleging that CAIR defrauded hundreds of Muslim and non-Muslim clients, issued a shocking ruling when he summarily dismissed the lawsuit, which was brought in the U.S. District Court for the District of Columbia.
Immediately, the American Freedom Law Center (AFLC) and the Law Offices of David Yerushalmi appealed, asking the D.C. Circuit to reverse Judge Friedman and reinstate the plaintiffs’ claims against CAIR.
The appellate court heard oral arguments in February of this year. Judge Sri Srinivasan, often mentioned as one of the judge’s on the President’s short list to fill a slot on the U.S. Supreme Court, sat as Chief Judge for the 3-judge panel that also included Judge Robert Wilkins, who authored the unanimous decision, and Judge Douglas Ginsburg.
David Yerushalmi, lead counsel for the five plaintiffs in the two consolidated cases alleging that CAIR hired a fake lawyer who defrauded the CAIR clients, explained the decisiveness of the appellate court’s ruling:
“The Court of Appeals not only reversed the trial court, sending the case back for a jury trial, but it carefully went through each fact we argued Judge Friedman either dismissed out-of-hand or ignored completely to justify his clearly erroneous ruling, explaining further why each fact supports our claims against CAIR.”
CAIR, a self-described Muslim public interest law firm, was previously named as a Muslim Brotherhood-Hamas front group by the FBI and the U.S. Attorney’s Office in the federal criminal trial and conviction of a terrorist funding cell organized around one of the largest Muslim charities, the Holy Land Foundation (HLF). HLF raised funds for violent jihad on behalf of Hamas, and top CAIR officials were part of the conspiracy. In addition, several of CAIR’s top executives have been convicted of terror-related crimes. As a result, the FBI publicly announced that it has terminated any outreach activities with the national organization, which bills itself as “America’s largest Muslim civil liberties and advocacy organization.”
The two lawsuits dismissed by Judge Friedman, which were consolidated by the court because they arose out of the same facts, follow an earlier lawsuit that had also alleged that CAIR’s fraudulent conduct amounted to racketeering, a federal RICO crime. In that case, the court dismissed the RICO counts, concluding that CAIR’s conduct as alleged was fraudulent but not a technical violation of RICO.
The pending lawsuits allege that Morris Days, the “Resident Attorney” and “Manager for Civil Rights” at the now defunct CAIR-MD/VA chapter in Herndon, Virginia, was in fact not an attorney and that he failed to provide legal services for clients who came to CAIR for legal representation. As alleged, CAIR knew of this fraud and purposefully conspired with Days to keep the CAIR clients from discovering that their legal matters were being mishandled or not handled at all. Furthermore, the complaints allege that according to CAIR internal documents, there were hundreds of victims of the CAIR fraud scheme.
According to court documents, CAIR knew or should have known that Days was not a lawyer when it hired him. But, like many criminal organizations, things got worse when CAIR officials were confronted with clear evidence of Days’ fraudulent conduct. Rather than come clean and attempt to rectify past wrongs, CAIR conspired with its Virginia Chapter to conceal and further the fraud.
To this end, CAIR officials purposefully concealed the truth about Days from their clients, law enforcement, the Virginia and D.C. state bar associations, and the media. When CAIR did get irate calls from clients about Days’ failure to provide competent legal services, CAIR fraudulently deceived their clients about Days’ relationship to CAIR, suggesting he was never actually employed by CAIR, and even concealing the fact that CAIR had fired him once some of the victims began threatening to sue.
While Judge Friedman agreed that Days and CAIR’s Virginia chapter were liable for fraud, he concluded, after improperly weighing the evidence, that CAIR National in D.C., the named defendant in the lawsuit, was not responsible for Days’ fraudulent conduct. The appeals court, however, found that Judge Friedman was wrong on each and every fact raised by the plaintiffs, concluding, contrary to Judge Friedman, that each fact supports finding a direct relationship between CAIR National and Days.
David Yerushalmi, who is also AFLC’s co-founder and senior counsel, remarked: “CAIR engaged in a massive criminal fraud in which literally hundreds of CAIR clients have been victimized. In his ruling, Judge Friedman inexplicably ignored material facts that establish CAIR National’s liability and then engaged in a transparently disingenuous ‘weighing’ of the factual evidence he did address, which is patently improper when evaluating cross-motions for summary judgment. We are thankful that the appeals court has rectified the trial court’s errors. Now, at long last, our clients will go before a jury and get their day in court.” Robert Muise, co-founder and senior counsel of AFLC, added,
“This ruling is a significant victory. Not only does it reinstate our claims against CAIR, but it makes plain that we have an incredibly strong case to present to a jury. In short, CAIR has no way out. It is a fraudulent organization, and we will get a chance to prove that to a jury.”