Sunday 22 July 2018

US court threatens developer Dunne with jail in email disclosure dispute

Developer Seán Dunne has bankruptcy proceedings hanging over him in the US and Ireland. Photo: Collins Courts
Developer Seán Dunne has bankruptcy proceedings hanging over him in the US and Ireland. Photo: Collins Courts
Shane Phelan

Shane Phelan

A US judge has threatened bankrupt developer Seán Dunne with the prospect of jail if he defies a subpoena requiring him to disclose emails about his business dealings.

The Carlow-born developer was held in contempt by Judge Julie Manning in Connecticut last August amid claims he omitted "enormous amounts" of material subpoenaed by bankruptcy trustee Richard Coan.

At a further hearing last month, Timothy Miltenberger, a lawyer representing Mr Coan, alleged Mr Dunne had still made no attempt to comply with the subpoena.

According to a transcript of the hearing, obtained by the Irish Independent, Judge Manning said she would have to consider making a further contempt order against Mr Dunne.

"There is a way for Mr Dunne to purge himself of this contempt. He should attempt to do so. Otherwise then maybe I am going to issue an order that he goes to jail. What else is the court to do?" she said.

The records are being sought as part of a lawsuit in which Mr Coan wants to reverse the transfer by Mr Dunne of tens of millions of euro in assets to his wife Gayle Killilea.

Assets

Mr Coan claims the assets were fraudulently transferred and that the developer still controls and benefits from them, an accusation the couple deny.

The case is just one arm of sprawling legal proceedings associated with Mr Dunne's financial implosion. The one time 'Baron of Ballsbridge' filed for bankruptcy in the US in 2013 with debts of around €700m, but he was also adjudicated bankrupt in Ireland. This has given rise to an unusual dual bankruptcy in two jurisdictions.

He had been due to exit bankruptcy in Ireland in 2016, but the official assignee, Christopher Lehane, has sought to extend the period by five years, alleging non-co-operation and the hiding of income and assets.

Mr Dunne has previously claimed he no longer had access to certain business emails.

He said he had shut down Gmail accounts, claiming they had been hacked by agents working for Nama. The allegation has been rejected by Nama.

At the hearing last month, Mr Miltenberger said Mr Dunne had "acted contemptuously".

Addressing the judge, he said the situation was "something that screams for some sort of sanction against Mr Dunne".

Mr Dunne's lawyer James Berman said his client had no objection to Google providing him with the emails and that he would then give all relevant ones which were not private or privileged to the trustee.

Judge Manning set two deadlines for Mr Dunne to meet this month, for the filing of an affidavit and a log of privileged emails. She said that if he did not comply, it may result in further contempt orders.

Addressing Mr Berman, she said: "Mr Miltenberger suggests a monetary fine. There is also orders to put your client in jail. We have entered orders in this court to put clients in jail for failing to comply with court orders. I don't think your client wants that."

In a subsequent affidavit, Mr Dunne said he had only been able to retrieve emails from one of five email addresses he had used. He also said he had never failed to fully co-operate in the realisation of his assets.

He claimed his creditors had used his bankruptcy "as a means of wreaking legal havoc on my family by running parallel cases in the USA and Ireland".

Irish Independent

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