By Terrence McCoy
By Allie Conti
By Chuck Strouse
By Scott Fishman
By Terrence McCoy
By Ryan Yousefi
By Ciara LaVelle, Kat Bein, Carolina Del Busto, and Liz Tracy
By Pepe Billete
You might think a lawyer facing a federal fraud investigation and possible disbarment would keep a low profile. Not James Dougherty. Employing the legal rationale that the best defense is a good offense, he filed two lawsuits against his accusers this past December. While the Miami Beach attorney refused numerous interview requests from New Times, his filings do provide some insight as to his perspective.
The first suit is a federal action brought against the Sturge syndicate at Lloyd's of London, which paid him more than nine million dollars to defend a single insurance claim on a shipment of coffee. In April 1992 the underwriters demanded that Dougherty resign and subsequently accused him of overbilling $2.5 million. Dougherty asserts that Sturge actually owes him at least $1.5 million more that what has already been paid, based on his long hours and outstanding work.
For starters, he claims to have toiled on the case "in excess of 18,000 hours between 1987 and 1992." This would mean that Dougherty logged an average of about thirteen hours every single day A weekends and holidays included A from the day he took the case in May of 1987 until his forced resignation on April 1, 1992. The Florida Bar complaint filed against Dougherty on behalf of Sturge states that he was the attorney of record in 146 other cases during this time period. Between June of 1991 and June 1992, Dougherty claims to have worked 6062 hours, an average of more than sixteen hours per day on the Sturge case alone.
Dougherty further argues in his suit against Sturge that he achieved results that justify a bonus. In so doing, however, he appears to have cited inaccurate figures. He asserts, for instance, that his work on the coffee claim filed with Lloyd's by Jordanian Munther Bilbeisi resulted in the "defeat of a $25 million bad faith counterclaim" by Bilbeisi. The actual figure in Bilbeisi's counterclaim is "in excess of $12 million." Dougherty also argues that his racketeering suit against Bilbeisi and the Bank of Credit and Commerce International, the bank that financed much of his exporting, resulted in BCCI's agreeing to pay Sturge a settlement "in excess of $800,000." Jon Zeder, the lawyer hired by Sturge after Dougherty's resignation, would not disclose the actual settlement, but he says it is several hundred thousand dollars less than the figure Dougherty cites. "And because BCCI is bankrupt," Zeder notes, "we'll receive only a fraction of that amount."
To back his claim for bonus pay, Dougherty supplies affidavits from attorneys Arno Kutner and Walter Sam Holland, both of which were signed in July 1992, before Jon Zeder presented his findings to the Florida Bar. Based on information supplied by Dougherty, Holland stated that Dougherty and his staff are owed a minimum of $1.6 million more in attorney's fees than the $4 million he was paid; Kutner estimated Dougherty's underbilling at $1.8 million. Dougherty's records indicate that he billed Sturge for a $10,000 check to Holland on April 13, 1992 A twelve days after he was asked to resign. (Sturge refused to pay.)
The same week he filed the suit against Sturge, Dougherty filed an action in state court against Vicente Valls, the exporter who served as his chief investigator throughout the coffee case. The complaint accuses Valls of failing to account for $620,000 Dougherty disbursed to him during the Bilbeisi investigation. Dougherty also alleges that Valls forged checks and attempted to sell "major defensive armaments and weapons to Central America" while working for him.
Valls, who accompanied Dougherty on numerous trips to Central America, is a key witness in the federal probe targeting Dougherty. He declined to comment about Dougherty's specific allegations but says the lawsuit is a desperate attempt to discredit him and to distract attention from Dougherty's own actions.
Two months ago Valls countersued, demanding treble damages for attorneys' fees and court costs. He alleges that Dougherty spent one million dollars of client money on dalliances that included hiring three prostitutes in Honduras, paying for the subsequent birth and maintenance of a daughter by one of those prostitutes, subsidizing the smuggling into the U.S. of two Salvadoran women and purchasing for their use two condos and a series of cars. As exhibits Valls attached deeds, certificates of title, medical bills, and even a photograph of Dougherty's alleged illegitimate child. Dougherty is married to Lucia Dougherty, a respected zoning attorney and partner in the firm Greenberg Traurig.
According to more than half a dozen former employees, one of the undocumented Salvadorans, Korina Bretado (also known as Cecilia Ramirez), was Dougherty's mistress, and their relationship was common knowledge around his office. She is said to have dropped by regularly, often to pick up checks. "Jim used to tell people she was the daughter of some Central American general," recalls one ex-associate. "It became an inside joke. They had a very volatile relationship. I remember one fight in the office that turned so violent we were afraid one of them was going to get thrown off the balcony."
A second source says Dougherty became so jealous of Bretado at one point that he subpoenaed her phone records using an unrelated case. New Times has obtained copies of that subpoena, the phone records produced by Southern Bell, and several checks made out to cash by Dougherty and endorsed by Bretado. Dougherty refused to comment about his relationship with Bretado. Bretado hung up the phone immediately when contacted by New Times.