Legal News

Stanford Withdraws $7.2B Lawsuit Against Government

By Ashby Jones

By now, we’re used to strange goings-on coming out of the Allen Stanford camp.

So a bit more doesn’t really surprise us.

Today’s Stanford head-scratcher: the alleged Ponzi-schemer, currently held pending his trial, dropped a lawsuit seeking $7.2 billion from federal law enforcement a little over a month after he filed it. Click here for the story, from Talking Points Memo.

Last month, Stanford sued Justice Department officials as well as Federal Bureau of Investigation and Security and Exchange Commission agents last month for allegedly violating his Fourth, Fifth, Sixth and Eighth Amendment rights.

Stephen R. Cochell, a Texas-based lawyer for Stanford, wrote in a motion filed last week that the claims in the action “will be preserved without pursuit of this case at this time.”

A federal judge ordered the case dismissed on Monday.

Stanford had alleged the federal government used more than $51 million of his assets to pursue the cases against him. "The agents have engaged in unfair, abusive law-enforcement methods and tactics," violating Stanford's rights under the U.S. Constitution, according to the complaint.

Stanford alleged that he came under scrutiny because the SEC was being criticized in late 2008 and early 2009 for failing to detect misconduct by Bernie Madoff.

Full post as published by Law Blog - WSJ.com on March 24, 2011 (boomark / email).