Judge Troubled by Apparent City, CAP Conspiracy


(APN) ATLANTA — Fulton County Superior Court Judge Craig Schwall expressed concern today over mounting evidence that the City of Atlanta, Central Atlanta Progress, and Manny Fialkow engaged in an improper conspiracy to deprive the Metro Atlanta Task Force for the Homeless of funding so that Fialkow could obtain the building.

Schwall presided over the hearing which was supposed to be regarding Fialkow’s attempt to get a temporary restraining order to keep Anita Beaty, Executive Director of the Task Force, out of the building.

The Task Force also received notice early today of Fialkow’s attempt to evict the Metro Atlanta Task Force for the Homeless–but not the homeless men, yet–from the building.

However, the Task Force, represented by Steve Hall of the Baker Donelson law firm, argued that the foreclosure itself needed to be reversed because Fialkow engaged in a conspiracy to deprive the Task Force of funding in the first place.

That would be like if your landlord wanted to turn your apartment into a luxury condo, so he went to your employer and convinced him or her to fire you because he says you’re a bad person, then he evicts you for failure to pay rent even though the reason you can’t pay rent is because he conspired to deprive you of funds.

“The plaintiffs contend they bought the notes and foreclosed… and they should be allowed to serve dispossessory on the shelter,” Schwall said. “The defendants accused the plaintiff, Fialkow, of stopping the ability of the Task Force to receive funding… to weaken the financial position of the Task Force as a basis to foreclose.”

“I have some questions. Did Fialkow do business with the advice and consent of [CAP director] AJ Robinson?… I have a lot of questions about your client’s [Fialkow’s] conduct,” Schwall said.

“The Benevolent Community Investment Company, LLC, what is its nature?” Schwall asked. “Why were the entities named that way? Has Mr. Fialkow been in the business of purchasing properties in the past? Why not purchase the notes using his regular [businesses]? What need was there to incorporate other entities? Was it solely for the purpose of these notes?”

Fialkow’s attorneys stated it was solely for the purpose of obtaining the notes.

“Was Central Atlanta Progress trying to buy the notes? When?” APN has previously reported that CAP created a shadow corporation, 477 Peachtree, which attempted to purchase the notes from Mercy Housing.

“I saw the minutes from the CAP board meeting where they talked about trying to buy the building,” Schwall said.

“I need someone to enlighten me as to the role of Debi Starnes,” Schwall said.

Atlanta Progressive News has already enlightened our readers previously about Ms. Starnes, who received at least 40,000 dollars from Central Atlanta Progress and 10,000 dollars from a downtown hotel to serve as Homeless Policy Advisor to former Mayor Shirley Franklin.

“What was she supposed to be doing besides making Robinson happy?” Schwall asked.

“She was supposed to be Policy Advisor for the Homeless,” the Plaintiff’s attorney said.

“I didn’t see any of that,” Schwall said. “I think it’s pretty clear CAP wanted them to move,” he added.

“We think Mercy saw CAP as a big bad wolf,” Hall, the Task Force’s attorney said, explaining why Mercy would not sell the notes to CAP and possibly why Fialkow created a new entity to attempt to buy the notes.

“I’d be very interested in what representations were made to Mercy,” Schwall said.

Schwall left the door open for the foreclosure to be reversed. Still, in the meantime, he said the Task Force and Fialkow needed to work together to address the immediate health and safety concerns regarding the building and to ensure the homeless men living there continue to receive adequate care.

“We need to figure out a way to have insurance on the building. Tomorrow,” Schwall said.

“We sent an email, bring your inspectors in. Our concern is they’re going to come in and scare the residents,” Hall said.

“What happened to Dan Cathy? All of a sudden he cut off funding?” Schwall asked. As previously reported by APN, the City and CAP collaborated in convincing Cathy to de-fund the Task Force.

“Ms. Beaty has her detractors. The Task Force has her detractors. But if CAP went to donors and went to the Tri-J and loaded up a van of individuals, I don’t see how that’s not tortious interference,” Schwall said.

“I don’t necessarily see the innocence of Mr. Fialkow,” Schwall said. “I just want to know why he formed the Trust, why he named it the way he did, why Mercy sold the note? It may be he was involved because Central Atlanta Progress wanted to get the Task Force out.”

Fialkow has insisted he is interested in helping the homeless men at the shelter.

“I don’t see you plopping down 900,000 dollars just to help people,” Schwall said. “I am going to have to hear a lot about your client. What I’m hearing and seeing doesn’t smell good.”

Schwall asked Rev. Darrell Elligan, former President of Concerned Black Clergy, to monitor the relationship between the Task Force and Fialkow as discovery continues in the various cases. Schwall asked Elligan, the Task Force, and Fialkow to have a discussion in the jury room.

They agreed to form a committee consisting of Carl Hartrampf for the Task Force; Chris Allers for Fialkow; Elligan; and three other so-called neutral parties: Rev. Gerald Durley, Rev. Sam Candler, and Rev. Barbara King.

They agreed that Fialkow would purchase insurance for the building and the Task Force would allow an insurance inspector into the building. The Task Force would also agree to allow health and safety code inspectors into the facility. Fialkow also agreed not to charge the Task Force rent.

The committee was also charged with seeing whether the homeless men are being served adequately, although Beaty told APN she hopes the committee will realize that the Task Force is not able to provide as much as it once did since the City and CAP conspired to sabotage its funding.

Fialkow was also told he could try to provide additional services for the homeless. Beaty told APN she was worried there would be no additional services, but that previously-available services would become available only through Fialkow.

“He’s trying to restrict services, paying agencies to only offer services through him,” Beaty said.

Fialkow is working with Central Atlanta Progress, United Way, and other agencies to move as many homeless men as possible out of the shelter at Peachtree-Pine. However, two Task Force case managers said that Fialkow is attempting to send Task Force residents to other shelters where they are told they can only receive services for 60 or 90 days.

Meanwhile, discovery will continue in the case. Hall is trying to consolidate several cases–including the TRO, the dispossesory, the federal tort case concerning the conspiracy, and others–but is unsure which ones will be able to be consolidated.

“There has been an eviction filed against the Task Force,” Fialkow’s attorney said. “We have agreed to have that magistrate court action merged to… your honor. With respect to the eviction process itself, [we seek] a stay, so they’re not required to file an answer until we give them notice.”

Hall has represented other clients in similar cases in other cities and won multi-million dollar settlements, Beaty said. The Task Force could potentially win such a settlement in the federal suit, putting it back in a secure financial position.

But in the meantime, Judge Schwall needs to deal with the dispute involving Mr. Fialkow and the irregularities of the foreclosure. Even that is something that won’t happen soon.

“Ultimately, down the road we’ll figure out who owns this property,” Schwall said.


About the author:

Matthew Cardinale is the News Editor for The Atlanta Progressive News and is reachable at matthew@atlantaprogressivenews.com.

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