The "kids for cash" scandal centered on judicial

kickbacks A kickback is a form of negotiated bribery in which a commission is paid to the bribe-taker in exchange for services rendered. Generally speaking, the remuneration (money, goods, or services handed over) is negotiated ahead of time. The kickbac ...

to two judges at the

Luzerne County Luzerne County is a county in the U.S. state of Pennsylvania. According to the U.S. Census Bureau, the county has a total area of , of which is land and is water. It is Northeastern Pennsylvania's second-largest county by total area. As of ...

Court of Common Pleas A court of common pleas is a common kind of court structure found in various common law jurisdictions. The form originated with the Court of Common Pleas at Westminster, which was created to permit individuals to press civil grievances against one ...

Wilkes-Barre Wilkes-Barre ( or ) is a city in the U.S. state of Pennsylvania and the county seat of Luzerne County. Located at the center of the Wyoming Valley in Northeastern Pennsylvania, it had a population of 44,328 in the 2020 census. It is the s ...

Pennsylvania Pennsylvania (; ( Pennsylvania Dutch: )), officially the Commonwealth of Pennsylvania, is a state spanning the Mid-Atlantic, Northeastern, Appalachian, and Great Lakes regions of the United States. It borders Delaware to its southeast, ...

, US. In 2008, judges Michael Conahan and

Mark Ciavarella Mark Arthur Ciavarella Jr. (born March 3, 1950) is an American convicted felon and former President Judge of the Luzerne County Court of Common Pleas in Wilkes-Barre, Pennsylvania, who was involved, along with fellow judge Michael Conahan, in th ...

were convicted of accepting money in return for imposing harsh

adjudication Adjudication is the legal process by which an arbiter or judge reviews evidence and argumentation, including legal reasoning set forth by opposing parties or litigants, to come to a decision which determines rights and obligations between the p ...

s on juveniles to increase occupancy at the PA Child Care for-profit detention centers. Ciavarella disposed thousands of children to extended stays in youth centers for offenses as trivial as mocking an assistant principal on Myspace or

trespass Trespass is an area of tort law broadly divided into three groups: trespass to the person, trespass to chattels, and trespass to land. Trespass to the person historically involved six separate trespasses: threats, assault, battery, woundi ...

ing in a vacant building. After a judge rejected an initial plea agreement in 2009, a federal grand jury returned a 48-count

indictment An indictment ( ) is a formal accusation that a person has committed a crime. In jurisdictions that use the concept of felonies, the most serious criminal offence is a felony; jurisdictions that do not use the felonies concept often use that of a ...

. In 2010, Conahan pleaded guilty to one count of racketeering conspiracy and was sentenced to 17.5 years in federal prison. Ciavarella opted to go to trial the following year. He was convicted on 12 of 39 counts and sentenced to 28 years in federal prison. In the wake of the scandal, the

Supreme Court of Pennsylvania The Supreme Court of Pennsylvania is the highest court in the Commonwealth of Pennsylvania's Unified Judicial System. It also claims to be the oldest appellate court in the United States, a claim that is disputed by the Massachusetts Supreme Ju ...

overturned hundreds of adjudications of delinquency in Luzerne County. The Juvenile Law Center filed a

class action lawsuit A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class actio ...

against the judges and numerous other parties, and the Pennsylvania state legislature created a commission to investigate juvenile justice problems in the county.

Investigations

's Judicial Conduct Board received four complaints about Michael Conahan between 2004 and 2008, but later admitted it failed to investigate any of them, nor had it sought documentation regarding the cases involved. The

FBI The Federal Bureau of Investigation (FBI) is the domestic intelligence and security service of the United States and its principal federal law enforcement agency. Operating under the jurisdiction of the United States Department of Justice, t ...

was tipped off about Conahan and nepotism in the county courts in 2006. An additional investigation into improper sentencing in

began in early 2007 as a result of requests for assistance from several youths received by the

Philadelphia Philadelphia, often called Philly, is the List of municipalities in Pennsylvania#Municipalities, largest city in the Commonwealth (U.S. state), Commonwealth of Pennsylvania, the List of United States cities by population, sixth-largest city i ...

-based Juvenile Law Center. Attorneys from the Center determined that several hundred cases were tried without the defendants receiving proper counsel. In April 2008, the Center petitioned the

Pennsylvania Supreme Court The Supreme Court of Pennsylvania is the highest court in the Commonwealth of Pennsylvania's Unified Judicial System. It also claims to be the oldest appellate court in the United States, a claim that is disputed by the Massachusetts Supreme Ju ...

seeking relief for alleged violation of the youths'

civil rights Civil and political rights are a class of rights that protect individuals' freedom from infringement by governments, social organizations, and private individuals. They ensure one's entitlement to participate in the civil and political life o ...

. The application of relief was later denied, then reconsidered in January 2009 when corruption charges against both Conahan and

surfaced. The FBI and the

IRS The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax ...

also investigated Conahan and Ciavarella, although the exact dates and scope of these federal investigations were not made public. Part of the investigation was revealed to have occurred during disciplinary hearings over the conduct of another former Luzerne County judge, Ann H. Lokuta. Lokuta was brought before the Judicial Conduct Board in November 2006 to answer charges of using court workers to do her personal bidding, openly displaying bias against some attorneys arguing before her, and publicly berating staff to cause mental distress. The board ruled against Lokuta in November 2008, and she was removed from the bench. During the course of the hearings, Lokuta charged that Conahan was behind a conspiracy to have her removed. She aided the federal investigation into the "kids for cash" scheme prior to the Conduct Board's ruling, and a stay order was issued in March 2009 by the Pennsylvania Supreme Court in light of the ongoing investigations, halting Lokuta's removal and the

special election A by-election, also known as a special election in the United States and the Philippines, a bye-election in Ireland, a bypoll in India, or a Zimni election (Urdu: ضمنی انتخاب, supplementary election) in Pakistan, is an election used to f ...

that was to be held to replace her. During the Lokuta hearing, Conahan testified that there were no social relationships amongst the county judges. However, Judge Michael T. Toole (who pleaded guilty to and was convicted in April 2011 of Fraud and Tax Evasion charges) as well as another judge, had each stayed at a

Florida Florida is a state located in the Southeastern region of the United States. Florida is bordered to the west by the Gulf of Mexico, to the northwest by Alabama, to the north by Georgia, to the east by the Bahamas and Atlantic Ocean, and to ...

condo jointly owned by Conahan and Ciavarella. The Pennsylvania Supreme Court decided to uphold Lokuta's removal from the bench in January 2011, finding she had received a fair trial, regardless of Conahan's testimony. It also ordered the

expungement In the common law legal system, an expungement proceeding is a type of lawsuit in which a first time offender of a prior criminal conviction seeks that the records of that earlier process be sealed or destroyed, making the records nonexistent or ...

s of the records of 2,401 of those juveniles who were affected.

Charges and pleas

A statement from the U.S. Attorney's Office for the Middle District of Pennsylvania outlined the charges against the two judges on January 26, 2009. The charges outlined in the

information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random ...

described actions between 2000 and 2007 by both judges to assist in the construction and population of private juvenile facilities operated by the two Pennsylvania Child Care companies, acting in an official capacity in favor of the private facilities over the facility operated by Luzerne County. The U.S. Attorney charged that in 2002 Conahan, who at the time was President Judge of the court, used his authority to remove funding for the county-operated facility. The judges were alleged to have received "millions of dollars" in payments for the completion of a binding agreement between the court and the private facilities, co-owned by attorney Robert Powell, to use their services and the subsequent closing of the county facility. The methods used to conceal the payments involved several parties and transactions which resulted in allegations of

tax evasion Tax evasion is an illegal attempt to defeat the imposition of taxes by individuals, corporations, trusts, and others. Tax evasion often entails the deliberate misrepresentation of the taxpayer's affairs to the tax authorities to reduce the tax ...

against the two. Ciavarella and Conahan were also charged with "Ordering juveniles to be sent to these facilities in which the judges had a financial interest even when Juvenile Probation Officers did not recommend placement," according to the statement. Original, negotiated plea agreements called for both judges to serve up to seven years in prison, pay fines and restitution, and accept responsibility for the crimes. However, on July 30, 2009, Judge Edwin M. Kosik of

Federal District Court The United States district courts are the trial courts of the U.S. federal judiciary. There is one district court for each federal judicial district, which each cover one U.S. state or, in some cases, a portion of a state. Each district cou ...

in nearby

Scranton Scranton is a city in the Commonwealth of Pennsylvania, United States, and the county seat of Lackawanna County. With a population of 76,328 as of the 2020 U.S. census, Scranton is the largest city in Northeastern Pennsylvania, the Wyoming V ...

rejected the plea agreement, citing "post-guilty plea conduct and expressions from the defendants" that he ruled did not satisfy the terms of the agreement. Kosik wrote that Conahan and Ciavarella continued to deny their crimes even in the face of overwhelming evidence, and therefore did not merit sentences that were well below federal sentencing guidelines. Attorneys for the two judges brought a motion requesting reconsideration of the judge's rejection of the plea agreement. The motion was denied on August 24, 2009, and Ciavarella and Conahan subsequently withdrew their guilty pleas, an action which eventually resulted in a

jury trial A jury trial, or trial by jury, is a legal proceeding in which a jury makes a decision or findings of fact. It is distinguished from a bench trial in which a judge or panel of judges makes all decisions. Jury trials are used in a significan ...

for Ciavarella and additional charges against the former judges. Following the plea withdrawals, on September 9, 2009, a federal grand jury in Harrisburg, Pennsylvania returned a 48-count indictment against Ciavarella and Conahan including racketeering, fraud, money laundering, extortion, bribery, and federal tax violations. Both judges were arraigned on the charges on September 15, 2009. Ciavarella and Conahan entered pleas of not guilty on all counts and remained free on $1 million in bail, despite federal prosecutors' contentions that their bail should be raised. Prosecutors argued the judges' bail should have been higher, since they faced the possibility of substantially more prison time and there had been evidence of attempts made to shield assets. Robert Powell, an attorney at the time and co-owner of the two juvenile facilities at the heart of the scandal, pleaded guilty on July 1, 2009, to failing to report a felony and being an accessory to tax evasion conspiracy, in connection with $770,000 in kickbacks he paid to Ciavarella and Conahan in exchange for facilitating the development of his juvenile detention centers. The Pennsylvania Supreme Court temporarily suspended Powell's law license on August 31, citing his criminal conviction. Several years later, in early 2015, after tending his resignation on January 7, he was disbarred by the state supreme court in the state of Pennsylvania on 23 January, the disbarrment was made retroactive to the date of his suspension on August 31, 2009. Robert Mericle, the prominent real estate developer who built the two juvenile facilities, pleaded guilty on September 3, 2009, to failing to disclose a felony. Mericle had failed to tell a grand jury he had paid $2.1 million to Ciavarella and Conahan as a finder's fee. As part of his plea, Mericle agreed to pay $2.15 million to fund local children's health and welfare programs. Mericle faced up to three years in prison and a $250,000 maximum fine. Mericle was released from federal custody in 2015 after serving a one-year sentence. Sandra Brulo, the former deputy director of Forensic Services for the Luzerne County Juvenile Probation Office, agreed to plead guilty in March 2009 to federal obstruction of justice. Those charges stemmed from actions Brulo took after she became aware she had been named in the federal civil action. Brulo backdated her recommendation of a placement she made concerning a juvenile defendant in September 2007, and changed her original recommendation of placement to probation.

Criminal verdicts and sentences

On February 18, 2011, following a trial, a federal jury convicted Ciavarella on 12 of the 39 remaining counts he faced including racketeering, a crime in which prosecutors said the former judge used children "as pawns to enrich himself." In convicting Ciavarella of racketeering, the jury agreed with prosecutors that he and Conahan had taken an illegal payment of nearly $1 million from a youth center's builder, then hid the money. The panel of six men and six women also found Ciavarella guilty of "honest services mail fraud" and of being a tax cheat, for failing to list that money and more on his annual public financial-disclosure forms and on four years of tax returns. In addition, they found him guilty of conspiring to launder money. The jurors acquitted Ciavarella of extortion and bribery in connection with $1.9 million that prosecutors said the judges extracted from the builder and owner of two youth centers, including allegations that Ciavarella shared the proceeds of FedEx boxes that were stuffed with tens of thousands of dollars in cash. Following Ciavarella's conviction, he and his lawyer appeared on the steps of the courthouse to give an impromptu press conference. The press conference was interrupted by Sandy Fonzo, whose son Edward Kenzakoski died by suicide in June 2010 after Ciavarella adjudicated him to placement, despite Kenzakoski's first-time offender status. On August 11, 2011, Ciavarella was sentenced to 28 years in federal prison as a result of his conviction. He is currently being held at the

Federal Correctional Institution, Ashland The Federal Correctional Institution, Ashland (FCI Ashland) is a low-security United States federal prison for male inmates in the unincorporated area of Summit in Boyd County, Kentucky, approximately outside the city of Ashland. It is operated ...

, a low-security federal prison in eastern Kentucky. He is scheduled for release on June 18, 2034, when he would be 84 years old. Ciavarella appealed his conviction to the Third Circuit and it was rejected on July 25, 2013. However, Ciavarella has continued to appeal, contending that the Supreme Court's decision in the case of ex-Governor of Virginia Robert McDonnell narrowed the scope of the

honest services fraud Honest services fraud is a crime defined in (the federal mail and wire fraud statute), added by the United States Congress in 1988, which states "For the purposes of this chapter, the term ''scheme or artifice to defraud'' includes a scheme or ...

statute. On January 9, 2018, federal judge Christopher C. Conner threw out Ciavarella's convictions for racketeering, conspiracy to commit racketeering, and conspiracy to commit money laundering. Conner upheld Ciavarella's contention that his attorneys failed to raise

statute of limitations A statute of limitations, known in civil law systems as a prescriptive period, is a law passed by a legislative body to set the maximum time after an event within which legal proceedings may be initiated. ("Time for commencing proceedings") In ...

claims on those charges. He ordered a new trial on those counts, but allowed the honest services fraud convictions to stand. On September 23, 2011, Conahan was sentenced to years in federal prison after pleading guilty to one count of racketeering

conspiracy A conspiracy, also known as a plot, is a secret plan or agreement between persons (called conspirers or conspirators) for an unlawful or harmful purpose, such as murder or treason, especially with political motivation, while keeping their agre ...

. Due to coronavirus concerns, he was released from prison in June 2020, six years early. On November 4, 2011, Powell was sentenced to 18 months in federal prison after pleading guilty to failing to report a felony and being an accessory to tax conspiracy. He was incarcerated at the

Federal Prison Camp, Pensacola The Federal Prison Camp, Pensacola (FPC Pensacola) is a minimum-security United States federal prison for male inmates in unincorporated Escambia County, Florida, near Pensacola. It is operated by the Federal Bureau of Prisons, a division of the ...

, a low-security facility in Florida, and was released from a halfway house on April 16, 2013. On August 10, 2015, a judge approved a $4.75M settlement agreement for Powell, for having paid kickbacks related to the adjudication of at least 2,400 juveniles. Robert Mericle's sentencing in connection with his guilty plea for failing to report a felony was delayed pending his anticipated testimony in the bribery trial of former Congressman and Pennsylvania State Senator Raphael Musto. On November 23, 2010, a federal grand jury had issued a six-count indictment against Musto, charging him with accepting more than $28,000 from an unnamed company and individual in exchange for his help in obtaining grants and funding. Musto denied any wrongdoing. After Musto died on April 24, 2014, Mericle was sentenced the next day to one year in prison by Senior District Judge Edwin M. Kosik. Mericle was ordered to pay a $250,000 fine and to report to the Federal Bureau of Prisons on May 14, 2014. He was released on May 29, 2015. On October 1, 2019, Ciavarella was disbarred on consent from the practice of law by the Commonwealth of Pennsylvania.

Victim lawsuits

Acting under a rarely used power established in 1722 and reserved for extraordinary circumstances, known as " King's Bench jurisdiction", the Pennsylvania Supreme Court appointed Senior Judge Arthur Grim of the

Berks County Berks County (Pennsylvania German: ''Barricks Kaundi'') is a county in the Commonwealth of Pennsylvania. As of the 2020 census, the population was 428,849. The county seat is Reading. The Schuylkill River, a tributary of the Delaware River, ...

Court of Common Pleas as

special master In the law of the United States, a special master is generally a subordinate official appointed by a judge to ensure judicial orders are followed, or in the alternative, to hear evidence on behalf of the judge and make recommendations to the jud ...

to review all juvenile cases handled by Ciavarella on February 11, 2009. He returned with his findings in an interim report dated March 11, 2009. He recommended that all adjudications handed down by Ciavarella from 2003 to 2008 be vacated, and that the affected juveniles' records be expunged. He concluded that due to Ciavarella's disregard for the juveniles' constitutional rights, as well as the kickbacks, no one who appeared before Ciavarella in that period had a truly impartial hearing. On March 26, 2009, the Supreme Court approved Grim's recommendations and ruled that Ciavarella had violated the constitutional rights of thousands of juveniles, and initially hundreds of juvenile adjudications were ordered overturned. A

class action A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class actio ...

lawsuit was filed by the Juvenile Law Center on behalf of the juveniles who were adjudicated delinquent by Ciavarella despite not being represented by counsel or advised of their rights. Besides naming Ciavarella and Conahan, the suit seeks damages under the civil portion of the

Racketeer Influenced and Corrupt Organizations Act The Racketeer Influenced and Corrupt Organizations (RICO) Act is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization. RICO was en ...

(RICO) against the judges' spouses and business associates, shell companies, youth center officials, and Luzerne County. Three other federal lawsuits filed on behalf of the victims have been consolidated with the Juvenile Law Center lawsuit into a master class action. An amended master complaint was filed on August 28, 2009. In June 2010, an injunction was filed on behalf of PA Child Care, Western PA Child Care, and Mid Atlantic Youth Services, the companies that provided treatment programs at the youth centers, to prevent the ordered destruction of thousands of juvenile records on the grounds the records are needed for the defense's case. On July 8, 2013, a three-judge panel of the

Third Circuit Court of Appeals The United States Court of Appeals for the Third Circuit (in case citations, 3d Cir.) is a federal court with appellate jurisdiction over the district courts for the following districts: * District of Delaware * District of New Jersey * E ...

ruled in the case of Markel International Insurance Company v. Robert J. Powell, (his business partner) Gregory Zappala, et al., that the insurance company had no obligation to defend or indemnify the individuals or corporations involved, leaving the defendants liable for adverse judgments. The builder and the owner of the private detention centers settled for payments of about $25 million. On August 17, 2022, U.S. District Judge Christopher Conner issued a verdict requiring that Judges Ciavarella and Conahan pay $106 million in compensatory damages plus $100 million in punitive damages to nearly 300 class members, who were children sent illegally to secure facilities during the scandal, using a base rate of $1000 per day of wrongful detention.

Interbranch Commission on Juvenile Justice

In the aftermath of the federal charges and defendant pleas, the Pennsylvania General Assembly moved to create a commission to investigate the entire set of circumstances surrounding the miscarriage of justice in Luzerne County. Sponsored by Representative Todd Eachus of Butler Township in Luzerne County, House Bill 1648 established the Interbranch Commission on Juvenile Justice in July 2009. The commission comprises 11 members, appointed from each branch of government in Pennsylvania, with four members chosen by the judiciary, four by the legislature and three by the governor. In signing the legislation on August 7, 2009, Governor

Ed Rendell Edward Gene Rendell (; born January 5, 1944) is an American lawyer, prosecutor, politician, and author. He served as the 45th Governor of Pennsylvania from 2003 to 2011, as chair of the national Democratic Party, and as the 96th Mayor of Philad ...

castigated Ciavarella and Conahan, saying they "violated the rights of as many as 6000 young people by denying them basic rights to counsel and handing down outrageously excessive sentences. The lives of these young people and their families were changed forever." Scheduled to meet a minimum of once per month, the commission was organized to investigate the actions of and damages caused by the two judges and review the state of the Luzerne County courts left in the wake of their tenures. The commission was given power of

subpoena A subpoena (; also subpœna, supenna or subpena) or witness summons is a writ issued by a government agency, most often a court, to compel testimony by a witness or production of evidence under a penalty for failure. There are two common types of ...

and was required to complete its work and report its recommendations and findings to the three branches of state government by May 31, 2010.

In popular culture

The scandal was featured in '' Capitalism: A Love Story'', the 2009 documentary by Michael Moore. A full-length documentary covering the scandal entitled '' Kids for Cash'' was released in February 2014, and has been favorably reviewed. Pulitzer Prize-winning investigative journalist William Ecenbarger wrote a well-reviewed book-length exposition of the scandal. In April 2014,

CNBC CNBC (formerly Consumer News and Business Channel) is an American basic cable business news channel. It provides business news programming on weekdays from 5:00 a.m. to 7:00 p.m., Eastern Time, while broadcasting talk sho ...

's crime documentary series ''

American Greed ''American Greed'' (also known as ''American Greed: Scams, Scoundrels and Scandals'' and as ''American Greed: Scams, Schemes and Broken Dreams'') is an American documentary television series on CNBC. The series focuses on cases of Ponzi schemes, ...

'' reported on the case. The scandal has also led to several portrayals in fictional works. The '' Law & Order: Special Victims Unit'' episode " Crush", the ''

CSI: NY ''CSI: NY'' (''Crime Scene Investigation: New York'', stylized as ''CSI: NY/Crime Scene Investigation'') is an American police procedural television series that ran on CBS from September 22, 2004, to February 22, 2013, for a total of nine seaso ...

'' episode "Crossroads", an episode of ''

The Good Wife ''The Good Wife'' is an American legal and political drama television series that aired on CBS from September 22, 2009, to May 8, 2016. It focuses on Alicia Florrick, the wife of the Cook County State's Attorney, who returns to her career in l ...

,'' and an episode of '' For the People'' featured corrupt judges sending children to private detention centers. An episode of ''

Cold Case A cold case is a crime, or a suspected crime, that has not yet been fully resolved and is not the subject of a current criminal investigation, but for which new information could emerge from new witness testimony, re-examined archives, new or r ...

'' called "Jurisprudence" is loosely based on this event. In 2015, crime fiction novelist Ace Atkins, using the nom de plume of the late Robert B. Parker, wrote ''Kickback'', which borrows heavily from this case, transposing it into a Boston suburb instead. An episode of '' Billions'' called "Quality of Life" has a subplot inspired by the scandal in which a New York City judge sentences youths harshly for financial gain. The novel ''Corrupted'' by Lisa Scottoline includes the scandal, portraying characters in the book as victims of the scandal.

References

{{Reflist

External links

Mid Atlantic Youth Services official website

Luzerne County Update Center
Juvenile Law Center
Interbranch Commission on Juvenile Justice
archive of activities including final report Political scandals in Pennsylvania Political corruption scandals in the United States Juvenile law History of Luzerne County, Pennsylvania Private prisons in the United States Crimes in Pennsylvania 2008 scandals 2008 in Pennsylvania