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Aisenbergs, lawyers asking for $7-million

By GRAHAM BRINK, Times Staff Writer

© St. Petersburg Times, published October 23, 2002

TAMPA -- Neither side disputes that defense attorney Barry Cohen and his clients Steve and Marlene Aisenberg are entitled to some compensation from the federal government.

TAMPA -- Neither side disputes that defense attorney Barry Cohen and his clients Steve and Marlene Aisenberg are entitled to some compensation from the federal government.

But should it cost taxpayers $7-million?

That's how much Cohen thinks the federal government should pay the Aisenbergs and his law firm for fighting a federal indictment that accused the couple of lying about the disappearance of their infant daughter, Sabrina, in 1997.

In throwing out the charges, a federal magistrate judge accused investigators of recklessly disregarding the truth.

Cohen's partner, Todd Foster, told a federal judge Tuesday that the $7-million would deter prosecutors from engaging in similarly "egregious tactics."

Federal prosecutor Ernest "Tony" Peluso called the request "shocking," and an attempt to secure a financial windfall for the legal team and the Aisenbergs that would violate the intent of the law.

"This is a travesty," Peluso said in court. He thinks the total should be $250,000, what the Aisenbergs have paid Cohen in legal fees.

The two sides made their arguments to U.S. District Judge Steven Merryday in the context of the Hyde Amendment, a rarely used law that allows federal criminal defendants to collect attorneys' fees from the government if the case was frivolous, vexatious or brought in bad faith.

After the case against the Aisenbergs collapsed last year, the government agreed the law applied but contested how much money to pay.

Sabrina Aisenberg was reported missing from her Valrico home on Nov. 24, 1997. She was never found. Hillsborough sheriff's investigators quickly came to suspect that the couple had something to do with the disappearence and received permission to bug the Aisenbergs' home.

Nearly two years later, a grand jury indicted the Aisenbergs on charges of conspiracy and making false statements. Prosecutors said the tapes from the bugging contained incriminating statements. But in a scathing report, U.S. Magistrate Judge Mark Pizzo said sheriff's detectives made up evidence to get permission to bug the home. He said the tapes he listened to did not contain incriminating comments.

Soon after, the charges against the Aisenbergs were dropped and the Aisenbergs' legal team filed a motion citing the Hyde Amendment to collect legal fees.

On Tuesday, Foster told the judge that the firm was owed $2.344-million for working 10,963 hours on the case since 1997. The law, Foster argued, allows for the fees to be increased in exceptional cases such as one in which lawyers expose government misconduct. Foster asked the judge to triple the fees to slightly more than $7-million.

"It's important to keep the system honest," Foster told the judge.

Peluso countered that the Hyde Amendment was set up to reimburse the defendants, not the lawyers. The law firm has collected only $250,000 from the Aisenbergs, he said. The government should only have to pay what the Aisenbergs have contributed and anything they are legitimately on the hook for, Peluso said.

He described the contract the Aisenbergs signed with the firm to pay $1-million each for their defense as "a cynical contrivance designed to support the Hyde Amendment claim." He said the firm knew from the start that the Aisenbergs couldn't possibly pay that amount, and the contract included provisions to make sure they never would have to.

Also, the firm planned on using the Hyde Amendment to secure a windfall if they won the case, he said. That constitutes a contingency agreement in which lawyers get paid a percentage of any award only if they win, which is illegal in a criminal case, Peluso said.

If the judge grants the Aisenbergs' legal team's request, he will be opening the flood gates for defense lawyers looking for a big payday, Peluso said.

"This is a Hyde Amendment nightmare," said Peluso, who will continue his argument today.

Merryday is expected to take the matter under advisement and release a written order later.

-- Graham Brink can be reached at (813) 226-3365 or .

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