Opinion ID: 3063949
Heading Depth: 3
Heading Rank: 3

Heading: Reizen’s Transfer to Solowsky

Text: On October 16, 2003, Reizen transferred six million dollars from a Deming Finance Ltd. account to a PSA client trust account known throughout this litigation as the “IOTA Account.” “Hawksbay/Brenman” was written on the transfer documentation. Reizen testified that he told Solowsky he had full authority over the funds and signed an engagement letter representing and warranting that he had: full and complete authority over and to the funds which we are holding in escrow, including the right to pay for legal defense in the above-referenced actions and any related actions which may be filed, and that, to your 6 knowledge, your authority has not been revoked, suspended or repudiated in any way. (Jt. Ex. 6.) Reizen further testified that he told Solowsky the transfer was intended to facilitate a settlement of the Bocciolone family dispute and that he (Reizen) believed he was entitled to over two million dollars of the funds under the Management Agreement. Reizen testified that Solowsky read the Management Agreement before he agreed to accept the funds. On October 21, 2003 Reizen sent Solowsky the first authorization for disbursal of the funds from the IOTA account. The authorization identified the funds to be disbursed as the funds from the Sitindustrie/Brenman Settlement. As per Reizen’s instructions, Solowsky distributed over three hundred and fifty thousand dollars. The money went to two companies, which Reizen testified that he used to make payments to himself, and to PSA as a retainer. On October 24, 2003 Solowsky transferred $5.5 million from the IOTA account to an interest bearing account at Gibraltar Bank.2 Over the next three years, upon Reizen’s written request, Solowsky disbursed over four million dollars from the trust accounts. These disbursals were all either made for Reizen’s benefit or to PSA. Reizen’s written requests all referred to the funds in connection with one or all of 2 We refer to this money, as well as the money in the IOTA account, as being held in trust. 7 the following: Sitindustries, Hawksbay, Brenman, Kobarid, and Tambourine.