Foster Graham Milstein & Calisher, LLP on Jan. 31 reported two big wins in the last few months of 2022, one delaying the recall of a Colorado state senator and the other recovering cryptocurrency seized by the Department of Justice.
Recall Delay
A recall petition for Colorado state Sen. Kevin Priola was prevented from circulating until Jan. 9, after the Denver District Court issued a preliminary injunction in a case challenging the senator’s recall.
Foster Graham attorneys Michael Rollin and Lindsey Idelberg challenged Priola’s recall because it raised questions under the Colorado constitution’s recall provision.
In 2016, Kevin Priola was elected to the Colorado Senate, representing Senate District 25. He was reelected in 2020 and changed his party affiliation in August 2022 from Republican to Democrat because of election denial and climate change, according to a press release from Foster Graham.
According to the district court’s ruling in 2018, Colorado voters adopted changes in the legislative redistricting process, adopting an independent redistricting commission tasked with revising electoral districts following the census. As a result of the 2020-2021 redistricting commission’s work, Senate Districts 25 and 13 were redrawn. The redistricting was approved by the Colorado Supreme Court Nov. 15, and with the finalized redistricting plan, Priola will now represent Senate District 13. There won’t be another regularly scheduled election for that district until November 2024.
Priola represented Senate District 25 until Jan. 9, after which he began to represent Senate District 13. In anticipation of Priola becoming their state senator in January, several electors from District 13 initiated a recall from that office. On Sept. 9, Colorado Secretary of State Jena Griswold authorized the circulation of a recall petition.
A resident of Senate District 25 and an issue committee formed to oppose the recall, asked the Denver District Court to defer the recall process, including the petition circulation, until after the Colorado General Assembly convened. The plaintiffs, represented by Rollin and Idelberg, argued the electors in Senate District 25 had a fundamental constitutional right to control who represented them and to participate or not participate in their senator’s recall. The plaintiffs filed a motion for a preliminary injunction against Griswold.
The Denver District Court issued the injunction in October, finding that until Jan. 9 Priola was subject to the will and answerable only to his Senate District 25 constituents and recall petitions couldn’t be filed while Priola was representing another district. The Colorado Supreme Court denied an appeal for the case in October.
Cryptocurrency “Wallets”
Foster Graham represents a hedge fund that specializes in trading cryptocurrency assets. The firm announced one of the fund’s partners was the subject of an unrelated federal criminal investigation, during which the government ended up seizing a laptop that contained five “private keys” to five cryptocurrency “wallets” belonging to the hedge fund.
Without the keys, the client had no ability to access or control the wallets that contained a total value of close to $2 million. The assistant U.S. attorney in Philadelphia, where the investigation was based, initially maintained the seizure was proper, and the cryptocurrency was subject to forfeiture
According to a press release, Foster Graham lawyers Gary Lozow, John Chanin and Katie Roush argued that the seizure was illegal and beyond the scope of the search warrant. The negotiations were ultimately advanced to the Chief of the Asset Forfeiture and Money Laundering Unit for the Eastern District of Pennsylvania.
Foster Graham announced it proved the cryptocurrency in the wallets came from the fund’s investors and threatened to file an action in the U.S. District Court, and the government relented and returned the private keys, allowing the firm’s client to access and transfer the cryptocurrency to new accounts.