Lawyers for Dr Yorai ‘Benny’ Benzeevi appeared in court on Wednesday, asking Judge Michael B. Sheltzer to lift a temporary restraining order freezing the money, bank accounts and future income of the former CEO of the Tulare hospital.
The judge declined to make an immediate decision, saying he would deliberate on the arguments and documents on either side and issue a written decision in the days ahead.
Sheltzer heard arguments from Benzeevi’s defense team – Oliver Wanger, Peter Jones and Christopher Lisieski of the Wanger Jones Helsley law firm – and Trevor Holly with the Tulare County District Attorney’s Office. Benzeevi appeared from a distance in the courtroom via Zoom.
Benzeevi, as CEO of Healthcare Conglomerate Associates (HCCA), oversaw the management of hospitals belonging to the local health districts of South Inyo and Tulare until 2017, when the two districts severed ties with the company and then sued HCCA, resulting in an extended period of legal acrimony before HCCA and each district signed bylaws.
The district attorney’s office then charged Benzeevi, former HCCA financial director Alan Germany and Baker Hostetler’s lawyer Bruce Greene, with a long list of alleged crimes related to the management of the two hospitals in August 2020, which led to Benzeevi’s arrest in December 2020.
All three have pleaded not guilty to the charges.
“We look forward to the opportunity to present our client’s version of the story, based on the real facts of what transpired in this extraordinarily complex matter,” Jones told the Voice of the valley.
Wednesday’s effort is separate from a 2019 case in which lawyers for Benzeevi tried to recover $ 937,000 seized by the district attorney’s office. His legal team appealed to the Fresno Fifth District Court of Appeals; records show appeal was “denied as irrelevant” by the court.
Funds frozen in 2020
On August 12, 2020, a day after charges were filed against the three, the district attorney’s office was able to obtain an “ex parte” – without the prior knowledge or involvement of the trio’s lawyers – temporary restraining order that prevented them from accessing multiple bank accounts.
The prohibition order also prevented them from “withdrawing, transferring, paying, encumbering, granting a security interest in, wasting, concealing, concealing, giving a preference to, or fraudulently transferring, or otherwise dissipating or disposing” of “anything else. of value â, including any bank accounts, retirement accounts or valuables not specifically listed, thereby freezing any future bank accounts.
Germany later came to an agreement with the prosecutor’s office allowing him to access his employment income, fully unfreeze multiple accounts, withdraw funds from two accounts exclusively for legal fees, keep only one 401K and one IRA under a partial freeze.
Freeze more accounts
On September 2, 2021, Sheltzer signed another ex parte order, this time freezing an Israeli bank account belonging to Benzeevi, an Israeli citizen.
According to a probable cause statement filed in court, after the initial temporary restraining order was granted, investigators from the district attorney’s office discovered a series of wire transfers from a US bank account to Bank Leumi’s account in Tel Aviv , in Israel.
In the statement, Rodney Klassen, an investigator with the Tulare County District Attorney’s Office, wrote that he “believes [the transfers were] in order to prevent these funds from being seized as restitution.
“I am of the opinion and believe that Dr Benzeevi holds foreign currency assets in the State of Israel and that these funds are legally seizable [sic]”, We read in Klassen’s statement.
No agreement to access the funds exists for Benzeevi, who is instead fighting to have the no-contact order lifted in its entirety.
Lisieski said the restraining order should be lifted because it was requested in a “procedurally inappropriate” manner, because the basis of the restraining order – to ensure restitution – does not apply. not in this case, and because the ordinance violates Benzeevi’s Sixth Amendment right to a lawyer by denying him the funds to pay a lawyer.
Although Germany may have requested a stipulation allowing it to access funds both for the defense attorney and for day-to-day living, Lisieski told the court that the fact that Benzeevi is asking the court limited access to its funds would “reverse the burden” on the district attorney’s office in Benzeevi.
He also told the court that the wide grip on Benzeevi’s funds – past, present and future – was unconstitutional: the office made no effort to differentiate between “contaminated” funds related to alleged crimes and the âuncontaminatedâ funds that existed outside the sphere. of the HCCA case, Lisieski said.
Holly argued that Benzeevi’s legal team had misinterpreted the law: the district attorney’s office could constitutionally freeze his assets, whether tainted or not, as long as there was a process in place to allow him access to uncontaminated and untied funds for his criminal defense.
âThe defense claims at this point are purely speculative, as they never asked
attorney fees, âHolly said in a court record.
Benzeevi’s lawyers wrote that he âstruggled to make ends meet and defend against district attorney’s exhaustive complaint“, Noting that District Attorney Tim Ward said in 2018 that the HCCA case was the” biggest investigation ever undertaken “by his office: Benzeevi should undoubtedly be able to pay” substantial attorney fees ” to defend.
âDr. Benzeevi needs money to pay his lawyers,â Lisieski told the court.[The restraining order] includes assets that have not even been earned yet.
Further, although the district attorney’s office said in a filing that the court “has jurisdiction to preserve up to twenty million four hundred thousand dollars ($ 20,400,000)”, the expected amount of restitution and fines , Lisieski told the court that restitution to the two health districts did not apply in this case.
This did not apply, he said, because HCCA had settled with the two: the company never owed them any money – each district owed HCCA, he said – and through the regulations, HCCA agreed to have their hair cut and settle.
Holly argued that the districts settled in out of desperation. Benzeevi’s financial firm, Vi Healthcare Finance, reached an agreement in 2017 with Southern Inyo to provide a loan secured by the district’s future tax revenues.
Separately, HCCA placed a lien on Evolutions a day before the local health district of Tulare went bankrupt. The property was one of the few unencumbered properties in the district, and with the privilege of HCCA, it could not be used to secure funding to reopen the Tulare Regional Medical Center.
âThe districts were desperate – they couldn’t afford to go to court,â Holly told the court. “So they settled down.”
He called the HCCA settlements with each district “by the throat”.
Lisieski has challenged this characterization on several occasions.
âThe regulations that were enacted were only a fraction of what the districts owed HCCA,â he told the court.
All parties met, put aside their differences and agreed that HCCA owed money, he said.
Court documents relating to the hearing are available at Voice HCCA Criminal Trial Record Tracker.