The Oyster Bay Town Board voted down a resolution Tuesday night to pay former Town Supervisor John Venditto’s legal fees in a civil case brought by the Securities and Exchange Commission last year.
Three board members and Supervisor Joseph Saladino voted against the resolution. Councilman Joseph Muscarella cast the lone vote in favor while Councilwoman Rebecca Alesia abstained and Councilman Anthony Macagnone recused himself.
Venditto, who was acquitted on federal corruption charges last month, was named as a co-defendant along with the town in a securities fraud suit brought by the SEC in November for not disclosing loan guarantees to bond investors and for allegedly making “materially misleading” statements about them when they were first disclosed in 2015.
The SEC trial was put on hold until the conclusion of Venditto’s corruption trial in U.S. Eastern District Court in Central Islip. In that trial, Venditto had been accused of accepting bribes and kickbacks in return for helping former concessionaire Harendra Singh obtain $20 million in loan guarantees.
The resolution voted down Tuesday would have authorized the town to pay Manhattan-based Brafman & Associates, P.C. an initial amount of up to $50,000 for legal expenses incurred since May 24. Venditto would have continued with the two lawyers who defended him in the criminal trial — Marc Agnifilo at $850 an hour and Joshua Kirshner at $650 an hour.
Agnifilo did not return a request for comment Tuesday.
Before the vote Syosset resident Kevin McKenna urged the board to delay voting on the legal fees.
“A vote against it is just going to trigger a lawsuit,” McKenna told the board. “The town and the public is going to lose.”
Sea Cliff resident Arthur Adelman said the board should vote it down because of the cost.
“$850 for Mr. Venditto’s attorney is outrageous,” Adelman told the board.
The board did pass two resolutions Tuesday also related to the loan guarantees.
The town board approved filing a civil lawsuit against former town attorney Leonard Genova for his role in the loan guarantees. Genova, who was Venditto’s longtime right-hand man, received immunity from criminal prosecution for agreeing to testify against Venditto.
Genova testified that town officials knew about the loan guarantees and covered them up, contrary to what Venditto and town officials told the public and bond investors.
The town has not released a civil complaint against Genova.
Genova’s attorney, Nicholas Gravante, said Tuesday that his client would respond to any allegations by the town “forcefully yet appropriately.”
The town board also approved an $11,918.40 payment on transcripts it bought from the criminal trial, which totaled 9,932 pages at $1.20 per page.
In the weeks following Venditto’s acquittal, Oyster Bay Town Attorney Joseph Nocella, who attended the trial, has declined to answer questions about whether the town would be on the hook to pay for the former supervisor’s legal costs in the SEC case.
In a June 21 memorandum signed on Nocella’s behalf by Deputy Town Attorney Matthew Rozea, the town attorney’s office concluded that, “Mr. Venditto is entitled to representation of counsel of his choosing” and that the town will pay that counsel “reasonable attorney’s fees and litigation expenses.”
“Given the complexity of the matter, the office of the town attorney cannot provide Mr. Venditto’s defense through ‘in house’ counsel,” the memo stated.
The memo cited state law that said the town “shall provide for the defense of the employee in any civil action or proceeding in any state or federal court arising out of any alleged act or omission which occurred or is alleged in the complaint to have occurred while the employee was exercising or performing, or, in good faith, purporting to exercise or perform his powers and duties within the scope of his public employment.”