Troutman Sanders

Troutman Sanders LLP was an Atlanta law firm that on July 1, 2020 combined with the Philadelphia firm Pepper Hamilton as Troutman Pepper Hamilton Sanders LLP, a firm of 1,100 lawyers in 23 cities, now Troutman Pepper Locke. Through its partner Bennet J. Moskowitz it represented Jeffrey Epstein and his U.S. Virgin Islands company Financial Trust Company in 2016 and 2018 against suits by Steven Hoffenberg, the convicted former chief executive of Towers Financial Corporation, and by Towers noteholders, who alleged that Epstein had been a participant in the Towers fraud and had capitalized Financial Trust with its proceeds; both suits ended within weeks. After Epstein's death its lawyer Charles L. Glover appeared in 2020 for the estate's co-executors Darren Indyke and Richard Kahn and for Financial Trust in a suit by a pseudonymous plaintiff.¹²³⁴

Hoffenberg v. Epstein

On May 27, 2016 Hoffenberg sued Epstein and "The Financial Trust Company" in the U.S. District Court for the Southern District of New York (No. 1:16-cv-03989) "individually, and as constructive trustee of the Noteholders and Bondholders of Towers Financial Corporation." Moskowitz wrote to Judge Richard J. Sullivan on June 28, 2016 that Hoffenberg lacked standing, that his claims "expired at least 15 years ago," that he was barred by in pari delicto, and that he failed to state a claim. The letter also stated that at a December 2013 conference in Hoffenberg's criminal case "Judge Sweet stated he was unaware of Epstein"; at that conference, on December 5, 2013, Hoffenberg's counsel had told Judge Robert W. Sweet that "Mr. Epstein is a critical player here." Hoffenberg withdrew the complaint with prejudice by letter of July 1, 2016, and Sullivan dismissed the case on July 5, 2016, five weeks after filing.¹⁵⁶

Gerber v. The Financial Trust Company

On August 20, 2018 two Towers noteholders, Marvin Gerber and Kalma Koenig, filed a putative class action against Epstein and Financial Trust (No. 1:18-cv-07580), alleging that Epstein "raised over five hundred million dollars" for the scheme and used its proceeds "to start and grow" Financial Trust. It attached Hoffenberg's affidavit of August 17, 2018 swearing that "Epstein and the corporations he formed were my co-conspirators," that "during the course of my criminal trial, Prosecutors offered me a reduced sentence in exchange for information about Epstein's role," and that the 2016 suit "was eventually withdrawn with prejudice and the full extent of Epstein's involvement in my crimes and the related frauds was never exposed." Moskowitz moved to dismiss with prejudice on September 14, 2018, filing the 1998 Financial Trust articles of incorporation among his exhibits, and the case was terminated on October 5, 2018 after a sanctions threat, the plaintiffs preserving the right to refile. Epstein was never charged in connection with Towers.²³

A draft of the firm's memorandum of law for Epstein and "The Financial Trust Company," marked "Privileged and Confidential; Attorney Work Product," is among the Justice Department's Epstein releases. Headed "Multiple SDNY Judges Warned the Person Driving This Action Against Such Frivolous Lawsuits," it recounted that Judge Richard M. Berman had warned Hoffenberg in 2001 that "he may not assert baseless claims or abuse the judicial process through the instigation of frivolous or duplicative suits," that Sweet had found in 2003 that Hoffenberg "will be enjoined from filing any further litigation ... without prior approval," and that Judge P. Kevin Castel had found a 2013 Hoffenberg petition "appears in several respects to be a frivolous pleading filed in violation of Rule 11(b)." It summarized the complaint as alleging that Hoffenberg hired Epstein "as a consultant back in 1987," and stated: "Defendants have never been found guilty of any wrongdoing related to Hoffenberg's fraud."⁷

The Estate

After Epstein's death on August 10, 2019, a plaintiff identified as "VE" sued the co-executors, Nine East 71st Street Corporation, Financial Trust Company, Inc. and NES, LLC (No. 1:19-cv-07625). On May 12, 2020 Glover of Troutman Sanders filed a notice of appearance for all of them. Indyke and Kahn have denied complicity in or knowledge of Epstein's crimes.⁸⁹