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Judge in Adelson lawsuit subject to unusual scrutiny amid Review-Journal sale

20 December 2015

By Jennifer Robison, James DeHaven, and Eric Hartley
Just over a month before Sheldon Adelson's family was revealed as the new owner of the Las Vegas Review-Journal, three reporters at the newspaper received an unusual assignment passed down from the newspaper's corporate management: Drop everything and spend two weeks monitoring all activity of three Clark County judges.

The reason for the assignment and its unprecedented nature was never explained.

One of the three judges observed was District Judge Elizabeth Gonzalez, whose current caseload includes Jacobs v. Sands, a long-running wrongful termination lawsuit filed against Adelson and his company, Las Vegas Sands Corp., by Steven Jacobs, who ran Sands' operations in Macau.

The case has attracted global media attention because of Jacobs' contention in court filings that he was fired for trying to break the company's links to Chinese organized crime triads, and allegations that Adelson turned a blind eye to prostitution and other illegal activities in his resorts there.

In May the billionaire and the judge clashed when Adelson took the witness stand but refused to answer a routine question.

"Sir, you need to answer the question," Gonzalez told him.

When Adelson argued, Gonzalez told him, "Sir, you don't get to argue with me. You understand that?"

It was not the first contentious exchange between Adelson's team and the judge. Gonzalez fined Sands and its Chinese subsidiary $25,000 in 2012 after finding their attorneys had tried to deceive the court, and this year she fined Sands China $250,000 for withholding documents.

Last year, attorney Michael D. Davidson told the Review-Journal an Adelson representative offered to "significantly and financially" support a campaign to unseat Gonzalez. An Adelson spokesman declined comment at the time. Davidson said he declined the offer.

How the judges, and Gonzalez in particular, came under scrutiny this year just as GateHouse Media was quietly finalizing the newspaper's sale and an ongoing management contract with Adelson's family remains unclear.

None of the 15,000 words the reporters wrote about their time sitting in courtrooms was ever published by the Review-Journal, but days later a long article blasting Gonzalez's rulings in the Sands case appeared in a small Connecticut newspaper with a connection to Adelson that became known only last week.

Unusual demands

The monitoring effort began in Las Vegas on Nov. 6 with a call from a top GateHouse Media executive to Review-Journal publisher Jason Taylor.

Taylor and other Review-Journal executives have said GateHouse did not specify Gonzalez as one of the three judges. She was selected at the RJ — though not within the newsroom — because she specializes in business lawsuits and is handling unrelated high-profile cases involving Adelson and fellow casino mogul Steve Wynn.

Family Court Judge Mathew Harter and Las Vegas Justice of the Peace Joseph Sciscento were selected by the reporters assigned to the effort.

An internal memo outlining the court initiative notes that each reporter was to "observe how engaged the judge is in the case, whether they're prepared or not, if they favor one lawyer over another, whether they're over- or under-worked — even whether they show up for work on time, or not."

The memo, authored by Review-Journal Deputy Editor James G. Wright, notes the initiative was undertaken without explanation from GateHouse and over the objection of the newspaper's management, and there was no expectation that anything would be published.

"We've simply been told we must do it, and it must start on Tuesday," Wright wrote.

Diaries kept by the reporters were submitted in mid-November to Taylor and the newspaper's attorney. Taylor said the diaries were never sent to GateHouse headquarters, nor did GateHouse corporate officials ever ask for them.

"When the request was handed down, it seemed like little more than a waste of time and resources," Review-Journal Editor Michael Hengel said. "I still think it was a waste of time, but now I wonder what really was behind it."

Review-Journal editors learned only Friday, after a version of this article was published online, that GateHouse management had attempted to get reporters from a Florida newspaper to investigate Las Vegas judges before forcing the assignment on the RJ.

Bill Church, executive editor of the GateHouse-owned Sarasota Herald-Tribune, said he received a call in early November about "a potentially big story regarding the court system and potential ethics violations."

The call was from David Arkin, GateHouse's vice president of content and audience. Church said that the call was brief and that Arkin did not name any specific judges, but did say the possible story involved campaign finances and how judges were ruling on certain cases.

After talking to his staff, Church told Arkin they could not immediately help.

"Given what I knew at the time, I said no, we just didn't have the resources, and there were too many questions that still needed to get resolved," Church said.

One major concern, Church said, was why the Sarasota newspaper would be asked to help when GateHouse also owned the Review-Journal, a larger newspaper in Las Vegas. Church said he would not have allowed his reporters to work on a Las Vegas story without Hengel's blessing.

Church said Arkin never called him about the matter again. He said he was "stunned" when he read an online version of this article on Friday, but did not know what to conclude.

Hengel said Friday that he knew nothing of GateHouse Media's attempt to involve the Florida newspaper.

"I've never talked to Arkin or anyone else outside of this newspaper regarding this project," Hengel said. "And the fact these discussions were going on with the Florida paper about Las Vegas without anyone in the newsroom having any knowledge of it is, to me, very troubling."

Reached by telephone Friday, Arkin said he was getting on a plane and would have to call back. Hours later, Arkin e-mailed a prepared statement defending the company's request for the Sarasota paper's help as well as GateHouse Media's newsroom ethics to Hengel, Wright and reporter Eric Hartley.

GateHouse was "engaged to tackle an investigative story in Las Vegas with no knowledge of the prospective new buyer. Because Las Vegas was relatively new to the company, we decided to approach our newsroom in Sarasota, Florida, a team that is known for tackling big investigative journalism," the statement reads in part.

"On the face of the situation, we had what appeared to be a great story we were capable of investigating, and I wanted our team to show its talent. From my point of view, it was nothing more."

Unusual connections

On Nov. 30, the New Britain Herald, a tiny Connecticut newspaper not affiliated with GateHouse, published an article critical of the performance of courts that specialize in business disputes. It singled out Judge Gonzalez with scathing criticism of her "inconsistent and even contradictory" handling of the Adelson case and another lawsuit involving Wynn Resorts Ltd.

The article suggests Gonzalez's rulings in those cases were unfair, and her work "undermines the rationale for the creation of such (business) courts in the first place — which was to provide reliable consistency, even predictability in the resolution of frequently recurring issues."

The article also says 24% of Nevada lawyers rated Gonzalez as "less than adequate" in the Review-Journal's regular "Judging the Judges" survey, but incorrectly presents that as an overall rating, rather than a ranking on one category regarding bias toward lawyers or litigants appearing before her.

The Adelson and Wynn cases were the only specific examples cited at length in the story. Two other judges were mentioned, but the critique of Gonzalez's courtroom proceedings consumed more than a quarter of the 1,900-word article.

The article's author was identified as Edward Clarkin, whose byline is found only one other time in the archives of the Connecticut newspaper, on a review of a Polish restaurant.

Attempts to locate Clarkin have been unsuccessful. Herald executives did not respond to requests for information, but a newspaper staffer said no one by that name works there. A nationwide search turned up no writer by that name, though laudatory reviews from Edward Clarkin, identified as being from the New Britain Herald and a sister paper, the Bristol Press, appear on the website of Tennessee mystery writer Keith Donnelly.

Donnelly did not respond to multiple requests for comment.

On Dec. 10, GateHouse announced the sale of the Review-Journal to News + Media LLC, a company organized in Delaware in September. At an RJ staff meeting, Michael Schroeder was introduced as the manager of the company, and said he would not identify its owners.

Schroeder owns Central Connecticut Communications, which operates the New Britain Herald and three other papers.

Reached at his Connecticut newspaper office Friday, Schroeder declined to say how the article came about or discuss Clarkin's role at the papers.

"I'm not going to talk about our newsgathering," he said, later adding, "I don't talk about our reporters, either — or our freelancers or anyone else."

Asked how a Review-Journal reporter might be able to reach Clarkin, Schroeder replied: "I have no idea."

When contacted for comment Thursday, Gonzalez said only that she didn't mind reporters or anyone else sitting in her courtroom, which is open to the public, but declined to comment further because the issue involves pending cases.

A District Court official who declined to be identified for fear of retribution suggested the issue may be of interest to federal authorities.

"I almost think your question is a federal question because ... when there's a question at a District Court that could involve a conflict, that's not a question we can investigate," the official said. "It seems to me you might want to talk to the (Justice Department) or someone else."

Linkage unclear

Whether there was a link between the GateHouse-ordered court monitoring assignment, the critical article in New Britain and the sale of the RJ to the Adelson family remains unclear.

Michael Reed, CEO of New Media Investment Corp., the parent company of GateHouse Media, declined to comment when asked whether Adelson was involved in the court monitoring directive. He said the effort was part of a "multistate, multinewsroom" investigative effort initiated by GateHouse, but said he did not know who started it or how it was approved.

"I don't know why you're trying to create a story where there isn't one," Reed told an RJ reporter on Wednesday. "I would be focusing on the positive, not the negative."

In a later interview with The Associated Press, Reed rejected the notion that the Review-Journal's integrity had been challenged by the secrecy surrounding its sale. He said the public didn't care about the buyer and that reporters pushed the story with the intention of creating controversy.

"I just wish reporters had better hearts and better intentions than just trying to slam media companies trying to do good," he said.

Taylor has said he has been assured by the Adelsons that they won't meddle in the editorial content of the newspaper.

In an interview with Reuters in Macau on Friday ahead of the formal opening of his new St. Regis hotel, Adelson said his family bought the RJ as a financial investment, dismissing speculation the deal was aimed at controlling media in the United States.

"The Review-Journal is already on my side of the political spectrum," Adelson said of the paper's Libertarian-leaning opinion pages.

"This newspaper has been making money... we left the (everyday) operation in the hands of the owner from who we bought it," Adelson said. "We are not going to hire an editor, we left it up to them (current management), period. We may take some of the positive characteristics of our Israeli newspaper and add them to there, but that's all just suggestions."

Copyright GamingWire. All rights reserved.


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