In Gary Melius Shooting Probe, Civil Case was Sealed at DA's RequestJames A. Cohen in Newsday, June 19, 2014
Suffolk County prosecutors asked that a civil case be hidden from the public to protect their investigation into the attempted murder of Oheka Castle owner Gary Melius, a judge's order from the recently unsealed case shows.
District Administrative Judge C. Randall Hinrichs in February sealed the business dispute between Melius and Joseph Ruocco, the founder of a DWI ignition lock company that Melius sought to control, saying he did so "to avoid impairing the integrity of an ongoing criminal investigation of an attempted murder in Suffolk County."
Although the judge did not name him in his May 15 unsealing order, Hinrichs acknowledged in an interview last week that he was referring to Melius, who was shot outside Oheka Castle on Feb. 24 by an unidentified assailant.
The unsealing order is the first official confirmation that investigators examined the civil case for connections to the shooting and the first tangible evidence that investigators are reviewing Melius' business relationships for clues to who wanted him dead.
Ruocco's attorney in the civil case, Peter Kaiteris, said his client had nothing to do with the botched murder attempt.
Kaiteris said that after the case was sealed, Ruocco complied with a request by the Suffolk County district attorney's office to answer questions. Police from the Second Precinct, which is based in Huntington, met with Ruocco in Riverhead, Kaiteris said.
A spokesman for the Suffolk County Police Department declined to comment. The district attorney's office did not respond to a request for comment.
The civil case between Melius and Ruocco involves control of Interceptor Ignition Interlocks, which sold devices to curb drunken driving. Records from the case show Ruocco reached an agreement with Melius to help win government contracts but that the partnership grew bitter. Melius filed a lawsuit in 2013 alleging financial improprieties and accused Ruocco of mismanaging the company.
Suffolk County Supreme Court Justice Thomas Whelan effectively awarded Melius control of the company in December, and Melius held the first shareholder meeting after that decision on Feb. 21. He was shot three days later.
Newsday's scrutiny of the case, which a reporter was able to retrieve from court files just before it was sealed, has revealed ties between Melius and several public officials that have raised questions about financial and political relationships since they came to light:
* State Police Senior Investigator Thomas Hughes owned shares in Interceptor and was among those Melius appointed to the board of directors after gaining control of the company. Kaiteris said Hughes ultimately declined the post, although he did not know whether it was after Newsday reported his involvement in the company. Hughes said Wednesday that he was not on the board but declined to comment further.
* Suffolk Conservative Party chairman and county Correction Department Lt. Edward Walsh said he attended the Interceptor shareholder meeting before the Melius shooting. Newsday reported that Walsh submitted a time sheet with the sheriff's office indicating that he was at work during the meeting. The report prompted an internal investigation, which is ongoing, of allegations of wage theft by Walsh and other department employees, including an officer facing criminal charges.
* Shortly after Melius joined Interceptor in a deal that required him to secure government contracts, Nassau and Suffolk counties tailored their policies on combating drunken driving in ways that boosted business for Interceptor.
* Whelan, the justice who presided in the civil case, effectively handed control of Interceptor to Melius after the Oheka Castle owner sought to appoint Whelan's friend and political benefactor, state Independence Party chair Frank MacKay, to the company board. Whelan did not disclose his ties to MacKay during the litigation.
Whelan ultimately recused himself from the case, according to a transcript of a May 23 hearing.
Whelan made no mention of his ties to MacKay. Instead, the justice defended himself by pointing out that in a conference with attorneys from both sides he disclosed a relationship to Melius, who plays a "prominent role in political life in Nassau and Suffolk County, in particular, the Independence Party," according to the transcript.
He pointed to a letter that attorneys for both parties wrote to state Chief Administrative Judge Gail Prudenti a week after Newsday first reported in March on Whelan's potential conflicts in the case. In the letter, the attorneys said Whelan had disclosed his ties to Melius and that they were comfortable with him presiding.
Whelan said at the hearing that news reports had failed to accurately reflect the "full disclosure" he made of his relationship to Melius.
"I take my oath of office very seriously and have always performed my duties with complete impartiality," Whelan said. "Yet in light of the inaccurate publicity . . . I will recuse myself from this case to avoid even the appearance of impropriety."
Newsday's report, however, never focused on Whelan's potential conflict because of his links to Melius. The report detailed the justice's ties to MacKay.
Whelan is godfather to MacKay's daughter, and the justice advised MacKay during his rise to party boss. MacKay, in turn, cut political deals that helped Whelan win his judgeship in 2000.
At the hearing, Whelan noted Melius' association with the Independence Party but did not mention any specific ties between Melius and MacKay. MacKay holds Independence Party fundraisers at Oheka, and Melius' former son-in-law, Rick Bellando, is the party's Nassau chairman.
In addition, MacKay is an Oheka employee paid between $100,000 and $150,000 annually, according to a state financial disclosure filing.
Although MacKay ultimately was not appointed to Interceptor's board, Bellando took a seat on the board three days before Melius was shot, according to Kaiteris, the attorney involved in the civil litigation.
Bellando did not respond to an email or calls for comment.
When Newsday first reported Whelan's ties to MacKay, Monroe Freedman, an expert on judicial ethics at Hofstra University Law School, said there was "no question" that Whelan should have recused himself due to "the unacceptable risk" of him continuing to hear the case.
Whelan did not respond to a call this month seeking comment. State court spokesman David Bookstaver said Whelan did not disclose his relationship to MacKay because the justice said MacKay was not an issue in the case.
MacKay did not respond to a call and email seeking comment.
Suffolk County District Attorney Thomas Spota asked to seal the civil case under criminal procedure rules. Newsday spoke with 10 lawyers and legal scholars who called the move highly unusual.
Bookstaver said Hinrichs told him he never before encountered such a request. Bookstaver also said that in his own 18 years with the court system, he never heard of a prosecutor requesting or being granted a sealing in such a fashion.
Hinrichs did not explain his decision to grant Spota's request but said, "I would not have signed the order if I did not feel there was a legal basis."
Spota's explanation for why the case should be sealed remains hidden because Hinrichs said the application to remove the file from public view would stay sealed.
Peter Davis, a criminal law professor at Touro Law School, said he had never heard of a prosecutor seeking to seal a civil case and found it "legally dubious."
However, Davis said, it was hard to make a judgment without the facts presumably found in the sealing application. While appearing legally questionable, the request may not be illegal, Davis said.
"One has to wonder what the motivation of the DA was," he said.
James Cohen, a criminal law professor at Fordham University, said although he had never heard of a prosecutor sealing a civil case, Spota might have done it because he feared a risk to public safety.
"It's possible the DA felt that there was something in the file that if someone got ahold of, it could prove dangerous to someone else," he said. "That would be the only justification for sealing a civil lawsuit."
The Interlock litigation is continuing, with lawyers for both parties arguing over company property. Three legal experts said Whelan's recusal would not affect his previous rulings in the case.
For much of the litigation, James O'Rourke, a law partner of Spota's before he was elected district attorney in 2001, represented Ruocco. O'Rourke withdrew from the case in January because Ruocco "completely failed to abide by the fee arrangement" and owed him $21,000, according to a court filing.
O'Rourke also stated in the filing that the attorney who had the corporate books and records, whom he did not name, would not release them.
After O'Rourke withdrew from the case, Kaiteris took his place.
Kaiteris said Ruocco plans to appeal Whelan's previous rulings, such as the one in December in which the justice awarded Melius 3.5 million Interceptor shares and wiped out all but 500,000 that Ruocco owned.
"We have a lot of work to do," Kaiteris said.