Bankruptcy And The NCAA

by Kurt O'Keefe, Attorney at Law

photoSo what does bankruptcy have to do with the NCAA investigation of the University of Miami?

The NCAA was expected to announce sanctions against the University of Miami (Florida) arising out of booster Nevin Shapiro allegedly showering Miami athletes with gifts, including female companionship.

Mr. Shapiro, now in prison for a Ponzi scheme, filed bankruptcy.  Of course, he spent some of the money on those athletes, so could not pay his creditors.  That happens when all you have is money you borrowed, invested, whatever the scam was, from others.

The NCAA does NOT have subpoena power.  It cannot use courts to force people to answer questions.

Well, they have a lot of questions for Mr. Shapiro and others in the U Miami investigation.

HandsBehindPrisonBarsVector

 So, Bankruptcy Rule 2004 allows the debtor, the one who files bankruptcy, or, any interested party in a bankruptcy case, trustee, creditor, whoever, can depose people who have information relevant to any part of the bankruptcy case.  Like, what assets the debtor has or had before filing bankruptcy.

 Apparently, other people involved with Shapiro in providing the alleged improper benefits were deposed as part of the Shapiro bankruptcy case.

The NCAA is claimed to have paid Shapiro’s bankruptcy lawyer to ask some questions of these other individuals.  At their depositions under bankruptcy rule 2004, which requires answers under oath.

Now, this does happen in bankruptcy cases.  I could be appearing, or not, at a trustee 2004 examination of someone.  The trustee’s attorney could ask questions that I provide.  Nothing improper about that.  However, I would NOT be paying the trustee or her attorney ANYTHING.   Like the legal pad in the picture, I could just write down some questions, and order a transcript later to get the answers.

“At the end of the day, that does not establish an attorney-client relationship between me and the NCAA,” Perez said. “It establishes that they wanted to pay for certain things to help Shapiro where there were issues of common interest. Period. There’s nothing wrong with that. They didn’t pay me to get testimony. They didn’t pay me to get a story. There’s a huge difference.”

Gee, where I come from, if someone pays me to do lawyer work, that makes him my client.  I think it is the same in Florida.  That is the attorney’s problem.

I think the NCAA problem is paying the attorney for the guy they are investigating.

I’ll bet you would NOT want your bankruptcy attorney being paid by someone who was investigating you.