A defense attorney for one of the two St. Germain businessmen accused of securities fraud, and the alleged victims in the case, are expressing polar opposite reactions to the decision of assistant attorneys general Amber Hahn and Christopher Liegel to file a motion seeking the dismissal of all charges.
Stephen Kravit, who is representing David Eliason, castigated the attorney general's office for bringing the charges in the first place while the alleged victims sent out a statement lamenting that they never got their day in court.
Hahn and Liegel, the special prosecutors on the cases, filed a motion late afternoon on April 7 asking the court to dismiss the charges against David Eliason and his brother, Brian.
"After considering new facts and information relating to the charges in the criminal complaint, the State concludes that it will be unable to prove the charges against the defendants beyond a reasonable doubt," their motion states.
The state had alleged the brothers failed to inform 19 potential investors in a new TIC (tenancy-in-common) company that their company did not have the finances necessary to stay in business.
The defense team of Kravit and Dean Strang (on behalf of Brian Eliason) vigorously disputed the allegations. They filed a Franks-Mann motion claiming Hahn and Liegel had information from the Eliasons' own accountants that disproved the allegations, but filed the charges anyway.
Kravit released a blistering statement Sunday in reaction to the state's motion.
"David and Brian Eliason committed no crimes," the statement reads. "After five years of investigation, the issuance of 10 felony counts of securities fraud, and the pendency of those charges for over a year, the state attorney general's office finally admitted that the charges it brought were wrong and moved to dismiss them.
Kravit goes on to claim the motion for dismissal is the result of "extraordinary work by the defense."
"We presented the defenses, which included experts in accounting, securities, and real estate law, who explained that the state didn't understand the financial statements discussed in the security offering. We did that twice before the charges were issued, and again after we discovered that the state all along had evidence absolving David and Brian of any guilt, but hadn't read or understood it," Kravit's statement reads. "Even then the state delayed dismissal to hire its own accounting expert, something it should have done before any charges were issued."
While the Eliasons are "elated and relieved" that the charges have been dismissed, Kravit called it a "Pyrrhic victory."
"These men are living the story of Job. Over the past six years they have lost their real estate business, their reputation, and all of their money. Their children were harassed, their families were shunned," the statement reads. "The state used its awesome power to ruin the lives of these men and their families. The charges should never have been brought. The investigation was incompetent. What recompense do David and Brian Eliason have, what is the state offering to return these fine men to whole? The answer is none, and nothing."
Kravit said Hahn and Liegel have not offered so much as an apology to the Eliasons. According to the statement, there was no new evidence that changed their minds about the prosecution, "only persistent insistence by the defense that the State understand the evidence it already had, which proved the Eliason brothers innocent."
"In the end the state justice department did the right thing to fully dismiss these charges. But the prosecutors deserve no credit. There was no high and mighty principle of justice behind this dismissal. The charges never should have been brought. There was an abject system failure in the DFI investigation, and then in attorney general (Brad) Schimel's justice department," the statement reads.
Kravit also noted that during the course of the case Schimel publicly stated Kravit's "aggressive defense of the Eliasons" was unethical.
"I demanded a retraction and apology and he refused. One year later here we sit, the case his office brought will be dismissed at the request of his prosecutors because it has no merit, no crimes were committed," Kravit said in the statement. "Perhaps Mr. Schimel can explain how his office could ethically bring and maintain felony charges that have no merit."
While the charges are expected to be dismissed - as of press time Judge Leon Stenz had yet to sign off on the dismissal - the Eliasons can't get their reputation or their business or their lost money back, Kravit added.
"This case is an object lesson in the misuse of the overwhelming power we give to our prosecutors, the resources, the automatic perception that someone charged with a crime is guilty. That power must be most carefully, competently and judiciously exercised. It was not in this case," Kravit said in his statement. "I give all respect to David and Brian, who are extraordinarily able, intelligent men who assisted greatly in their defense. Everyone on our defense team who has met and worked with them joins me in hoping for a new beginning and future success, finally free of this albatross."
On Tuesday morning, The Lakeland Times' sister paper the River News received an email that included a "statement from the victims."
"We are incredulously and deeply saddened after hearing the State of Wisconsin decision to not continue their pursuit of the fraud charges against David and Brian Eliason," the statement reads. "Despite the millions of dollars of losses imposed on their clients, the Eliason Brothers had seemingly boundless funds to hire high priced defense lawyers. We were not even granted our day in court, despite over a year in pending charges. This is just a reminder to all buyers, beware that there is no justice for the little man."
Calls to the Wisconsin Department of Justice seeking comment were not returned as of press time.
The Times would like to clarify that the state does not have an option to refile charges against the Eliasons at a later date, as stated in a previous story on the state's motion to dismiss. In fact, the statute of limitations has run out and the Eliasons cannot be prosecuted on these facts. We apologize for the error.
Jamie Taylor may be reached at firstname.lastname@example.org.
Posted: Tuesday, April 18, 2017
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The investors seem to be missing the irony of their complaint. Eliasons paid every last dime of savings and hundreds of thousands more to defend themselves for four and a half years against baseless criminal accusations that eventually had to be withdrawn. Investors had benefit of unlimited multi-million dollar resources of State of Wisconsin DFI and DOJ pursuing bogus charges all that time. Nobody like to lose money--a tough circumstance all the way around--but Eliasons didn't cause the worst U.S. financial recession since the Great Depression, much less the Borders and American TV bankruptcies. Considering the lack of a crime, I'd say the State and its supporters in this case got more than their pound of flesh.