Chad Elie Sues Former Lawyer for Malpractice

[SpewArtist]

http://www.forbes.com/sites/nathanva...r-malpractice/

Guess Elie needs to build up his bankroll for his professional poker debut once he gets out of the slammer.

[Dan Druff]

Here is a Cliffs Notes of Elie's complaint, which also contains a link to the full version:

http://www.onlinepokerreport.com/633...gainst-lawyer/

This Jeff Ifrah guy is a real piece of work.

If you recall, he appeared on 2+2 and misled the public for months regarding the state of finances of Full Tilt, shortly after Black Friday.

Poker Tracker, however, seems to love him. Here's what they wrote on their Facebook page:

We know Jeff Ifrah, he is highly respected in the online poker business. We hope that the allegations in this article are not true. Interesting that they chose to include an image of PokerTracker 3 in the article... we don't know why.

Jeff was one of the key lawyers who did the deal to get players back their funds at PokerStars, and also the Full Tilt deal with PokerStars. He is also on the ground working to get online poker legal in the state on NJ. He did not come off well in that thread, we agree with that, but the industry and players have benefited from his help in other scenarios.

So this guy apparently had his hand in everything.

Chad Elie is claiming that Ifrah made $5 million in commissions off of him (apparently getting a percentage of all payments processed, which was LOL for a lawyer), which then encouraged Ifrah to lie to him regarding the legality of processing online poker payments. Elie claims that he would have stopped processing payments if Ifrah told him the truth, but that Ifrah wanted to keep raking in the commissions, so he told Elie what he wanted to hear.

I do believe that Ifrah likely crafted his legal opinions around what was best for him, but I never bought Elie's story that he was totally clueless that what he was doing was illegal. In my opinion, I believe Elie was "lawyer shopping" -- basically looking for a lawyer to go on record with an opinion that processing online poker payments was legal, so he could later provide a defense to criminal charges if they ever occurred. Obviously it's tough to find a lawyer who will stick his neck out in such a fashion (since saying it was legal was highly inaccurate), so that's likely why Ifrah was paid so well.

This is similar to "doctor shopping" that some pain pill addicts engage in, where they intentionally search for doctors that will agree to over-prescribe them medication. It's also similar to "detective shopping", where people attempt to steer their criminal complaints to the detectives most likely to investigate and press for prosecution. Most police departments don't allow detective shopping and do not give complainants any choice in who handles their cases.

But getting back to Ifrah...

The guy seems really shady from everything he's done over the past 2 years, but I don't believe for a second that Elie would have bailed out of the industry had he "known" the truth.

Oh, also of interest in the article is the accusation that Ifrah cooperated with the DOJ in order to make Black Friday happen, but lied regarding his commissions regarding the payment processing. Elie is basically accusing him of throwing him under the bus with the DOJ while happily collecting online poker processing $ at the same time. I also believe this accusation. There is a good chance that Ifrah was not indicted due to his pre-Black-Friday cooperation.

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Home / U.S. Online Poker / Chad Elie’s Lawsuit Against Jeff Ifrah Thrown Out Due To Critical Black Friday Confession
Chad Elie’s Lawsuit Against Jeff Ifrah Thrown Out Due To Critical Black Friday ConfessionBy Marco Valerio on February 13, 2014 09:13 PST@AgentMarco Elie Ifrah Lawsuit Tossed Out
The United States District Court of Nevada has ruled in favor of defendants Jeff Ifrah and Ifrah Law PLLC in the lawsuit brought by Ifrah’s former client, pre-Black Friday online poker payment processor Chad Elie.
Elie sued Ifrah in April 2013, alleging legal malpractice and blaming Ifrah for Elie’s prosecution and incarceration related to online poker payment processing. Elie essentially claimed that it was due to advice he received from Ifrah Law on the legality of online poker payment processing that he carried on this activity until he was arrested.
Elie was one of the eleven men indicted on Black Friday. In March 2012, he pleaded guilty to bank fraud and began serving five months of a prison sentence later that year.
In his plea allocution (a statement before the court), Elie explicitly admitted that he had carried out his offenses on his own volition, without reliance on counsel, and with the knowledge that what he was doing was criminal.
This key confession would be Elie’s undoing in the lawsuit against Ifrah and his firm. The defendants have consistently responded to Elie’s accusations by pointing out that, by his own admission, Elie had discarded legal advice given to him, opting instead to act with criminal intent.
The court’s acceptance of Ifrah’s argument largely destroyed the rest of Elie’s case.
Elie was seeking damages for his Black Friday indictment, which he tried to argue came as a result of Ifrah’s counsel, but this cannot be demonstrated as long as Elie can be shown to have admitted that he acted on his own criminal accord.
The court repeatedly took this view, and has ordered the entire case to be dismissed.
According to the court document dismissing Elie’s lawsuit, Elie retained Ifrah to represent him in 2009, following a previous payment processing case in which Ifrah and his firm were not involved.
Elie had additionally confessed to acting with criminal intent in this previous case that unfolded before he met and retained Ifrah and the firm’s services.
Shortly after he was sentenced but before he began serving his prison term, Chad Elie publicly shared a series of statements and legal documents meant to embarrass or incriminate others in the Black Friday case, a stunt that gained significant poker media attention.
After his release from prison, he re-emerged as a sponsored pro for the free-to-play online poker site Attack Poker.
Jeff Ifrah and his firm continue to practice law in Washington D.C. The firm still represents PokerStars and other online gaming entities in certain cases.
Marco Valerio Marco Valerio - Marco is a contributor to OnlinePokerReport. You can read more of his writing - and catch his epic interviews with a who's who of poker - at a variety of iGaming publications, including TwoPlusTwo, GlobalGamingBusiness and AgentMarco.com.

[haleylh]

Meh, I wrote about it first at FlushDraw yesterday, with a lot more detail: http://www.flushdraw.net/news/chad-e...rah-dismissed/

Gaming attorney Ian Imrich was the first to publish the decision, on his JDSupra account. He probably got it right from Ifrah, who lost no time issuing a press release from Ifrah Law slamming Elie and threatening a defamation lawsuit, which I'll place a side bet doesn't happen.

Ifrah goes way, way back in online poker. He was involved in Full Tilt even before the "Jesus" group got involved back around 2001 or so, and he picked up Stars as a client, to the best of my knowledge, when Stars started shopping around for more East Coast legal connections.

Marco's piece utterly omits the most intriguing allegation by Elie, that Ifrah was a confidential informant for Preet Bharara's Black Friday investigation. It may or may not be true. I do note that Marco (who I admittedly have little use for) seems to be pretty friendly with Ifrah, while I tend to keep the guy at arm's length, though we have communicated a few times via e-mail. If you understand that Ifrah was also one of the go-betweens between Stars, the PPA, Jeremy Johnson's SunFirst processing payment and their inquiries to the Utah AG's office about processing legalities, then you understand how deep in it all Ifrah really was.

Ifrah has stridently dodged that C.I. question in all of his communications regarding Elie's lawsuit, and this dismissal allows him to keep that corporate veil in place and not answer the questions. It's also why I don't think he risks any sort of defamation action, so we'll all just have to guess and wonder. Elie did not offer any comment when I Tweeted at him last night about the dismissal.

Earlier, Elie published some docs and some images of smartphone texts sent between him, Ifrah and others. IIRC, there's stuff in there about Ifrah getting paid for his work and all that stuff, checking on wires/checks arriving and so on. But Elie sort of DQ'd his legal chances by admitting to guilt in his own plea deal.

I see pokerfuse also had a piece, with "Chad Ellie" in the title. One thing I'll say: Since I left there, their copy editing has gone all to fuck.

One concept I've toyed with is doing a Top 20 list of the people most responsible for Black Friday. In my subjective opinion, both Elie and Ifrah would be on the list -- Elie in the top 10 (maybe top five) and Ifrah def in the top 20.

[Dan Druff]

Ifrah was also supposed to appear in that Blu-Ray Extra for "Runner Runner", but he either never showed up for the interview or they cut his entire part. I'm guessing the former.

I never believed that Elie really thought he wasn't breaking the law with his payment processing. That was the part of the interview I had with him that I thought was total BS.

Haley, you say that you would want to list 20 people "responsible" for Black Friday. But responsible in what way?

Black Friday was actually a good thing overall, as it put a halt to the ongoing stealing at Full Tilt and UB. (Actually, Full Tilt continued to steal from non-US players for a few more months, but still, the bust ultimately is what shut them down and stopped further thefts.)

So do you mean responsible for the busts, or responsible for the situation to where Full Tilt lost/stole all the player money on deposit?

[haleylh]

Ifrah was also supposed to appear in that Blu-Ray Extra for "Runner Runner", but he either never showed up for the interview or they cut his entire part. I'm guessing the former.

I never believed that Elie really thought he wasn't breaking the law with his payment processing. That was the part of the interview I had with him that I thought was total BS.

Haley, you say that you would want to list 20 people "responsible" for Black Friday. But responsible in what way?

Black Friday was actually a good thing overall, as it put a halt to the ongoing stealing at Full Tilt and UB. (Actually, Full Tilt continued to steal from non-US players for a few more months, but still, the bust ultimately is what shut them down and stopped further thefts.)

So do you mean responsible for the busts, or responsible for the situation to where Full Tilt lost/stole all the player money on deposit?

I would say responsible for the massive departure of US-facing online poker after Black Friday. So that would go back and encompass people such as Bill Frist and Preet Bharara, company execs like Scheinberg, Lederer, Bitar and Tom, payment processors like Elie, Curtis Pope, Tzvetkoff and others. I could get to 20 pretty easy. Russ Hamilton would probably make it for helping put online poker in such a bad light.

[BeerAndPoker]

Black Friday was actually a good thing overall, as it put a halt to the ongoing stealing at Full Tilt and UB. (Actually, Full Tilt continued to steal from non-US players for a few more months, but still, the bust ultimately is what shut them down and stopped further thefts.)

I wonder how long each room (FTP and UB) would have survived after Black Friday if it never happened. My guess is UB not for too long but FTP would have still had tons of new money coming into the site that it could have continued on accordingly for a while longer on that system whereas Lock Poker is completely screwed since they don't have enough new funds being brought onto the site.

Of course without UIEGA ever passing things would be different as the bigger sites wouldn't have lost millions from processors running off with the money but I could still see a whole lot of smaller sites popping up for a cash grab and shutting down.

As for Chad Elie I'm on the fence with him after I saw that multiple part interview over on Pokernews. He don't seem like a bad guy but he definitely knew what he was getting himself into and risking when he got involved with payment processing. The thing is for a lot of people if you were to tell them they will be able to make a few million dollars and at the very worst do up to two years in prison but keep a majority of the money their is enough folks in this world that will be more then happy to take the risk.

[glide234]

One concept I've toyed with is doing a Top 20 list of the people most responsible for Black Friday. In my subjective opinion, both Elie and Ifrah would be on the list -- Elie in the top 10 (maybe top five) and Ifrah def in the top 20.

I would love to see an article like this.