Developer in 'Kids for Cash' judicial scandal agrees to settle outstanding civil cases for $17.75 million

Jon Campisi Dec. 20, 2011, 2:11pm

The developer at the heart of the so-called “Kids for Cash” judicial scandal that took place earlier last decade in Luzerne County, Pa. has filed court papers signifying that he has agreed to settle all civil claims arising from the case, in which juveniles were sent to privately-run detention centers for minor offenses by judges who were on-the-take.

Lawyers for Luzerne County developer Robert K. Mericle filed the settlement papers Dec. 16 at the U.S. District Court for the Middle District of Pennsylvania.

The settlement, which doesn’t yet appear to have been approved by a judge, is intended to resolve all outstanding claims against Mericle and his contracting firm, Mericle Construction Inc.

The $17,750,000 settlement figure is intended to resolve a handful of civil rights claims that have emerged since February 2009, a year after the last batch of juveniles in the Kids for Cash scandal were sent to two private youth detention facilities built by Mericle’s company.

From 2000 to 2007, Luzerne County judges Mark A. Ciavarella Jr. and Michael Conahan conspired to send juveniles to PA Child Care and Western PA Child Care, the facilities built by Mericle, in return for compensation by the developer, according to the original complaint filed in the wake of the scandal, Wallace v. Powell et al.

The kickback scheme is widely recognized as the largest judicial scandal in Pennsylvania’s history.

In August, Ciavarella, who was a juvenile court judge, was sentenced to 28 years in prison for his role in the scandal. Aside from taking money from the developer in exchange for placing juveniles in the facilities, Ciavarella was also found to have adjudicated juvenile cases within minutes, and without having legal counsel present for the children.

Conahan, a former senior judge with the Luzerne County Court of Common Pleas, was sentenced to 17-and-a-half years behind bars in September for his role in the criminal enterprise.

The settlement agreement states that a quick resolution is being sought given the anticipated lengthy and costly legal battle should the various civil cases be played out in open court.

“Despite the Parties’ strong belief in their respective positions, Plaintiffs and the Mericle Defendants recognize that there are substantial uncertainties and significant litigation costs with respect to the Civil Actions and their potential outcomes if they were taken to trial,” the settlement papers state. “Having considered their investigations and analyses of the facts and their evaluations of the law relating to the matters set forth in the Complaints, they have each determined that settlement of the Plaintiffs’ claims and allegations … is a fair and reasonable result for the Settlement Class Members.”

The settlement, while offering substantial compensation, does not include a concession of liability on the part of Mericle’s company.

While the settlement is an attempt to close the book on the civil side of the Kids for Cash case as far as Mericle is concerned, the criminal side has yet to wrap up.

Mericle, 48, pleaded guilty in 2009 to failing to report a felony and faces up to three years in prison, according to local news reports. He doesn’t appear to have been sentenced as of yet.

Lawsuits against the two former judges remain outstanding.

A handful of parents had sued on behalf of their children, who alleged they were sentenced to unreasonable stretches at the detention centers, often for petty offenses that would normally merit mere slaps on the wrist.

Attorney Daniel Segal, who represents one of the plaintiff’s, told the Philadelphia Inquirer Saturday that the proposed settlement seemed appealing.

“We are very pleased with the Mericle settlement and delighted that it will address the needs of the children affected by this matter,” Segal was quoted as saying.

The settlement, filed by Mericle attorney Eric Kraeutler, still has to be signed off on by U.S. District Judge A. Richard Caputo.

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