Jury awards $28.8 million to brother-in-law of King of Jordan

Jul 27, 2011

The following article was published in the Palm Beach Post on July 27, 2011:

Jury awards$28.8 million to King of Jordan’s brother-in-law

By Jane Musgrave

When a knock came at the jury room door at 11 a.m. Wednesday, speculation was high that Gulf Stream billionaire Harry Sargeant had beaten the king of Jordan’s brother-in-law in his quest for millions from U.S. defense contracts to deliver fuel to troops in Iraq.

Minutes later, when the jury announced the verdict it reached after two hours of deliberation, it was clear jurors had defied conventional wisdom.

The jury ordered Sargeant and another business partner to pay Mohammad Al-Saleh $28.8 million, finding that they defrauded the Jordanian out of the money that was rightfully his under a 2004 partnership agreement. Interest will add $10 million to $15 million to the jury award, Al-Saleh’s smiling legal team said.

“Justice, finally,” said Al-Saleh, a part-time Palm Beach resident who already earned about $27 million from the contracts.

But his victory may be short-lived.

Even before the jury began deliberating, Sargeant this week filed a federal lawsuit against Al-Saleh, making some of the same allegations against his former business partner in the contracts that ballooned to $2.7 billion.

The new lawsuit, filed in Miami, promises round two of the bizarre case of international intrigue that unfolded in Circuit Court. The nearly three-week trial, watched by note-taking men who said they worked for the federal government, included allegations of bribery of top Jordanian officials, shadowy work by a former CIA agent and Congressional claims of war-profiteering.

Featuring the latest courtroom technology and top-flight attorneys, it also illustrated how rich guys fight over money.

Not expecting a quick verdict, Sargeant, a formidable GOP fund-raiser and former finance chair of the Florida Republican Party, wasn’t in court to hear the jury’s decision. The third partner, Mustafa Abu-Naba’a, a Jordanian resident of the Dominican Republican, didn’t attend the trial. Their lawyer, Roger Kobert, vowed to appeal.

“This case should have never gone to trial as a matter of law,” he said. Under the act of state doctrine, he said, no U.S. court can sit in judgment of a foreign government’s decision. Circuit Judge Robin Rosenberg rejected the argument despite Sargeant’s claims that Jordan King Abdullah II ordered him to cut Al-Saleh out of the lucrative contracts.

New York City lawyer Barry Ostrager, who represents Al-Saleh, said the quick verdict meant jurors didn’t buy Sargeant’s claims.

Instead, he said, they likely embraced his view that Sargeant used Al-Saleh to curry favor from the royal family. After Al-Saleh got the critical OK from Jordan leaders to let them move fuel through the country, Sargeant dumped him “like a used handkerchief” and replaced him with former CIA agent Marty Martin, Ostrager said. A $9 million payment and $50 million deal with a Jordanian firm kept the contracts coming, he said.

However, jury foreman Joseph Dawson, said the basis for the verdict was far more pedestrian. To the four men and four women it was simply a contract dispute.

“It was all about their initial agreement; of them being partners,” he said. The three agreed to split the profits from the defense contracts. Al-Saleh deserved his share.

Figures from a CPA hired by Sargeant’s team helped jurors determine the award. Accountant Patrick Gannon testified that if jurors believed Al-Saleh was entitled to profits from all of the contracts, spanning from 2004 to today, they could award him $28.8 million.

Dawson said the jury discounted Ostrager’s repeated talk of a 2008 letter U.S. Rep. Henry Waxman wrote, accusing Sargeant of “war profiteering.”

“The jury was very impressed with Harry Sargeant, how professional he is and what hard work he does in a very difficult area,” said Dawson, athletic director at Grandview Prep.

During the trial, Sargeant testified a government audit cleared his firm. While auditors said taxpayers paid as much as $204 million too much for the fuel, they blamed federal staff for inadequately reviewing the contracts.

Sargeant wasn’t allowed to tell the jury why Abdullah in 2007 ordered him to dump Al-Saleh or even mention Abdullah by name. In the lawsuit filed this week, he does both.

He claims Abdullah barred his brother-in-law from profiting from the U.S. contracts after Al-Saleh was accused of trying to use his royal connections to help wealthy Iraqis, described as “Saddam Hussein cronies,” to move their frozen assets out of Jordan. He was also caught trafficking in African “blood diamonds,” the suit claims.

Al-Saleh attorney Louis Silber predicted the allegations would suffer the same fate in federal court as they did in circuit court: “They will be rejected.”

He also questioned the timing. “If the charges had any merit, he would have filed it long ago,” he said.

To slap Al-Saleh with a new suit when he is celebrating a long-awaited victory is unfair, he said.

“This is what we call dirty pool,” he said.

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