United States v. Barry Fischer Law Firm
U.S. DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Judge Thomas Griesa
Litigation in Brazil and the United States followed the 1999 seizure of $8.2 million from "Venus" and "Tradeland" bank accounts controlled by British Virgin Islands firm Kesten Development Corp. and its Brazilian parent Turist-Cambio Viagens Turismo. In 2012 a Brazilian court convicted Kestens' and Turist's principals (the Pires defendants) on charges arising from illegal laundering of drug money. Finding Kesten a shell company operated for illegal purposes, it ordered the $6.87 million in Kesten's Venus account confiscated. In an interpleader proceeding Brazil and a Cayman Islands bank's liquidators sought summary judgment to the Venus account. District court granted Brazil judgment, concluding that the Brazilian court's judgment estopped the liquidators from claiming an interest in the Venus account funds based on Kesten's interest, extinguished by the Brazilian court's criminal verdict against the Pires defendants. Discussing New York law, district court found the Brazilian judgment had preclusive effect. That court's criminal conviction was a final judgment for collateral estoppel purposes. Further, the Pires defendants had a full and fair opportunity to litigate the Venus account's forfeiture in the Brazilian court.