Lawsuit Vs Brown Smith

Case 1:11-cv-00472-WMS Document 1 Filed 06/06/11 Page 1 of 22
UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF NEW YORK
NRP HOLDINGS LLC and NRP PROPERTIES LLC
Plaintiffs,
v. Civil No.:
CITY OF BUFFALO, BYRON W. BROWN,

DEMONE A. SMITH,
RICHARD A. STENHOUSE, BUFFALO
JEREMIAH PARTNERSHIP FOR COMMUNITY
DEVELOPMENT, INC., JOHN DOE 1 – 10, and
JOHN DOE COMPANIES 1 – 5.
Defendants.
COMPLAINT
NRP Holdings LLC and NRP Properties LLC (collectively “NRP”), through
their attorneys Webster Szanyi LLP, state as follows:
Introduction
1. This is an action seeking recovery for actual and treble damages
caused by the conduct of the individual defendants who participated in the affairs of the
defendant City of Buffalo (“Buffalo”) through a pattern of racketeering activity in violation
of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961
et seq. This action also seeks recovery for defendants’ tortious conduct and for Buffalo’s
breach of a contract concerning NRP’s plans to develop, construct and manage (50) units
of single-family homes in the Masten Park and Cold Springs neighborhoods of the City of
Buffalo. Simply put, the individual defendants conspired to kill the project when NRP
refused to comply with their illegal demand to pay monies to Reverend Richard A.
Stenhouse and/or affiliated organizations in order for the Project to proceed. The illegal
demands by the individual defendants are commonly known as a “pay to play” scheme.
Parties
2. Plaintiff NRP Holdings LLC is an Ohio limited liability corporation with
its principal place of business in Ohio.
3. Plaintiff NRP Properties LLC is an Ohio limited liability corporation
with its principal place of business in Ohio.
4. Defendant City of Buffalo is a municipal corporation operating under
the laws of the State of New York.
5. Defendant Byron W. Brown (“Brown”) is a resident of the State of
New York.
6. Defendant Brown was and is the Mayor of Buffalo.
7. Defendant Demone A. Smith (“Smith”) is a resident of the State of
New York.
8. Defendant Smith was and is a member of the Buffalo Common
Council.
9. Defendant Richard A. Stenhouse (“Stenhouse”) is a resident of the
State of New York.
10. Defendant Buffalo Jeremiah Partnership for Community
Development, Inc. (“Jeremiah Partnership”) is a domestic corporation operating under the
laws of the State of New York.
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11. Defendant Stenhouse was and is the president of the Jeremiah
Partnership.
12. Defendants John Doe 1 – 10 and John Doe Companies 1 – 5
represent individuals and entities which plaintiff believes exist and may have acted
individually, together, and/or in concert with the defendants herein. Defendants John Doe
1 – 10 include both individuals employed by the City of Buffalo and within the private
sector. The allegations set forth below are incorporated as and against each John Doe
and John Doe Company as if fully set forth against him, her, or it.
Jurisdiction and Venue
13. This Court has federal question jurisdiction under 28 U.S.C. § 1331,
18 U.S.C. § 1964(a), and 42 U.S.C. §1983.
14. This Court has jurisdiction based on diversity of citizenship pursuant
to 28 U.S.C. §1332.
15. Venue is proper in this judicial district pursuant to 28 U.S.C. §1391
and 18 U.S.C. § 1965(a).
Factual Background
16. NRP are affiliates of the NRP Group LLC, an Ohio limited liability
corporation that develops, builds and manages apartments and housing across the
United States. Among other honors, the National Association of Home Builders named
the NRP Group LLC as the 2009 multifamily development firm of the year.
17. In November 2007, NRP was invited by representatives of Buffalo to
participate in a meeting to discuss affordable housing initiatives within the City of Buffalo.
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During this meeting, these representatives expressed their desire to work with NRP and
associated companies to build single family homes within the City of Buffalo.
18. Effective February 21, 2008, NRP entered into agreements with
associated companies to develop, construct and manage fifty (50) homes in the Masten
Park and Cold Springs neighborhoods of the City of Buffalo (the “Project”). (NRP and its
associated companies are hereafter collectively referred to as the “Development Team.”)
19. By letter dated February 25, 2008, Buffalo agreed and committed
itself to participate in the Project by, among other things, extending to the Project its usual
Low Income Housing PILOT agreement, providing $1,600,000.00 of its HOME funds to
assist in the construction and, in addition, providing fifty-one (51) buildable vacant lots at
a price no greater than $2,000 per buildable lot, and not to exceed a total price of
$100,000.00.
20. Buffalo’s agreement and commitment to the Project was subject to
one condition -- the Development Team’s success in securing 2008 Low Income Housing
Tax Credits (“LIHTC”) to complete the Project. (A copy of Buffalo’s February 25, 2008
agreement and commitment is attached hereto at Exhibit “A”.)
21. In the February 25, 2008 agreement and commitment letter, Buffalo
stated, among other things, that “[w]e are also supportive of the feature of the
development, which allows for homeownership conversion at the end of the tax required
compliance period. The lease to own component provides future homeownership
opportunities to residents who are not currently prepared to become homeowners, while
providing them with clean, state-of-the-art housing today.”
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22. As of February 25, 2008, Buffalo knew that under applicable law, the
tax compliance period referenced in the February 25, 2008 agreement and commitment
was thirty (30) years.
23. By letter dated August 20, 2008, the Development Team received a
commitment from the New York State Division of Housing and Community Renewal
(“DHCR”) for the necessary LIHTC. The DHCR commitment required “closing on
construction financing sufficient to complete the Project” on or before March 15, 2010. (A
copy of the DHCR August 20, 2008 agreement and commitment is attached hereto at
Exhibit “B”.)
24. By letter dated November 5, 2008, the DHCR notified the
Development Team that the amount of the LIHTC was increased from $794,363 to
$922,954. (A copy of the DHCR November 5, 2008 agreement and commitment is
attached hereto at Exhibit “C”.)
25. By letter dated November 5, 2008, the New York State Housing Trust
Fund Corporation (“HTFC”) notified the Development Team that the HTFC approved a
low interest loan in the amount of $2,200,000.00 in support of the Project. (By letter
dated March 19, 2009, the HTFC issued its agreement and commitment for the loan. A
copy of the March 19, 2009 agreement and commitment is attached hereto at Exhibit
“D”.)
26. After receiving the agreements and commitments from Buffalo and
the DHCR, Buffalo moved forward with its participation in the Project in accordance with
its February 25, 2008 commitment and agreement.
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27. For example, Buffalo issued letters in support of the Project and the
application to the DHCR.
28. Buffalo also selected the sites to be used for the single-family homes.
29. In addition, the City of Buffalo Planning Board “approved as
presented”, the site plan, design, and elevations submitted by the Development Team.
30. In early 2009, however, Brown, Smith, Stenhouse and the Jeremiah
Partnership conspired and started demanding that the Development Team contract with
Stenhouse and/or organizations connected to Stenhouse (including the Jeremiah
Partnership) to participate in the Project.
31. The Development Team was told that the participation of Stenhouse
was required in order to assure adequate minority involvement in the Project.
32. The Development Team was specifically instructed by Brown, Smith,
and other employees of Buffalo that it was necessary to “find a role for Stenhouse” and
“make Stenhouse happy” in order for the Project to proceed.
33. Initially, Stenhouse simply indicated an interest to make sure that
there was adequate minority involvement in the Project. Thereafter, Stenhouse
communicated a series of escalating demands. Instead of unofficial input, Stenhouse
then demanded a series of tasks involving ever increasing payments to him and later the
Jeremiah Partnership. Eventually, Stenhouse asked whether he could be a partner on
the Project similar to the arrangement he had on the Packard project, a previous project
in the City of Buffalo, where he was paid a “developer’s” fee. Stenhouse then demanded
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that the Development Team accept his response to a Request for Proposal, discussed
below, even though it was grossly inferior to the bid selected by the Development Team.
34. The Development Team was told that, because Stenhouse did not
have an acceptable contract on the Project, several items promised by the City of Buffalo
were being held up in defendant Brown’s office.
35. Despite these threats and demands, the Development Team
believed that they should issue a Request For Proposal (“RFP”) to satisfy the purported
need for an independent contractor on the Project devoted to minority involvement issues
even though members of the Development Team were already providing such services.
36. In April 2009, the Development Team issued the RFP for a provider
to assist it in maximizing participation in the Project by local minority business
enterprises, women-owned business enterprises and individuals.
37. The RFP was mailed to over thirty (30) organizations and an
advertisement was placed in the Buffalo News.
38. Stenhouse and the Jeremiah Partnership were advised of the RFP
and invited to respond.
39. The Development Team received three (3) proposals including one
from Stenhouse and the Jeremiah Partnership.
40. After a thorough review of the proposals, the Development Team
selected the proposal submitted by the University of Buffalo – Center for Urban Studies in
conjunction with J.W. Pitts Planning (collectively referred to as the “UB Team”).
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41. The proposal by the UB Team ranked far superior to the others and
was more reasonably priced.
42. In April 2009, the City of Buffalo issued site plan approval and a
permit ready letter for the Project.
43. In April 2009, the DHCR issued environmental and plan approvals for
the Project.
44. By April 2009, the Development Team had incurred considerable
expense and performed all tasks necessary to move forward with the Project.
45. The Development Team’s efforts included the selection of the UB
Team to satisfy the requests for additional minority participation and involvement in the
Project.
46. Likewise, the City of Buffalo’s Departments and Agencies and the
DHCR were also performing their necessary functions for the Project to proceed.
47. However, after selecting the UB Team and rejecting the proposal
submitted by Stenhouse and the Jeremiah Partnership, the Development Team’s efforts
to proceed with the project were stalled and ultimately killed by the defendants.
48. After supporting the Project for over eighteen months, Brown, Smith,
Stenhouse and the Jeremiah Partnership used their positions and influence to cause
Buffalo to breach its February 25, 2008 agreement and commitment to the Project by,
among other things, individually taking action to prevent completion of the project and by
directing City Departments, Agencies, and employees to either stop working on the
project or to take action to prevent the project from proceeding forward.
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49. Brown, Smith, Stenhouse and the Jeremiah Partnership conspired to
cause Buffalo to breach its agreement and commitment to the Project because the
Development Team refused to comply with the illegal demand that they pay monies to
Stenhouse and/or affiliated organizations in order for the Project to proceed.
50. During the course of these events and in making the illegal demand,
Brown said: “If you do not hire the right company [i.e. Stenhouse and/or the Jeremiah
Partnership], you do not have my support for the Project.”
51. Brown also said: “Make Stenhouse happy or the deal will not go
through” and further stated that he was “sick of seeing those fucking white developers on
the East Side with no black faces represented.”
52. After the Development Team selected the UB Team instead of
Stenhouse, Brown said: “I told you what you had to do and you hired the wrong
company.”
53. Smith made similar statements as those attributable to Brown in the
preceding paragraphs.
54. All of the defendants made certain statements in furtherance of their
illegal scheme, to each other and others, by U.S. mail, wire, telephonic, email, and/or
other electronic means.
55. Upon information and belief, Stenhouse and the Jeremiah
Partnership demanded a role on the project because of their past endorsement of Brown
as Mayor and in consideration for their future endorsement of Brown.
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56. Upon information and belief, Brown and the other defendants
intended to reward Stenhouse and the Jeremiah Partnership for their past endorsement
and support and, because of their position in the community, viewed the continuing
endorsement by Stenhouse and the Jeremiah Partnership as integral to Brown’s re-
election efforts in 2009.
57. Calendar Year 2009 was an election year for Brown.
58. The illegal schemes developed and implemented by Brown, Smith,
Stenhouse and the Jeremiah Partnership are commonly known as a “pay to play” and
“pay for votes” scheme.
59. Upon information and belief, Brown, Smith, Stenhouse and the
Jeremiah Partnership conditioned Buffalo’s support for other development projects that
proceeded within the City of Buffalo on those projects finding a role for and/or the
payment of monies to Stenhouse, the Jeremiah Partnership, and/or companies
associated with Stenhouse.
60. Upon information and belief, in situations where development
projects found a role for Stenhouse and/or the Jeremiah Partnership on their teams,
Buffalo honored its agreements and commitments on those projects.
61. Upon information and belief, the role of Stenhouse and/or the
Jeremiah Partnership in certain other development projects was essentially a “no show”
job where Stenhouse and/or the Jeremiah Partnership added little or no value to the
projects.
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62. Upon information and belief, Stenhouse did not have development
experience. As a result, the Mayor’s office often directed City employees to work directly
with Stenhouse at City expense to provide the expertise that he lacked and to perform
services that Stenhouse was being paid to perform on these other development projects.
63. Upon information and belief, the Packard project, commenced in or
about 2006, is another example where the individual defendants conspired to demand a
role for Stenhouse as a condition for approving a development project in Buffalo. In the
Packard project, Stenhouse became a “partner” on the development project and earned a
developer’s fee despite his lack of qualifications as a developer. Indeed, upon
information and belief, Stenhouse provide no services of value to the Packard project.
64. Upon information and belief, East Side Housing Opportunities, Phase
I is another example of where the individual defendants conspired to demand a role for
Stenhouse and/or his affiliated companies as a condition for approving a development
project in Buffalo. NRP was not involved in this Phase I project but has learned that
Stenhouse’s participation in the project added little to no value. Despite the lack of any
meaningful contribution to this project, Stenhouse was paid a significant fee at the
insistence of the defendants.
65. Prior to filing this complaint, NRP submitted a Freedom of
Information Law request to Buffalo requesting, among other things, documents in
Buffalo’s possession concerning Stenhouse and the Jeremiah Partnership. This request
was intended to determine the precise involvement of Stenhouse and the Jeremiah
Partnership concerning other development projects in Buffalo.
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66. In response, Buffalo first delayed and then failed and refused to
produce documents in its possession concerning Stenhouse and the Jeremiah
Partnership.
67. Discovery is necessary to determine the full extent of the precise role
played by Stenhouse and the Jeremiah Partnership in the Packard project, East Side
Housing Opportunities Phase I, and other development projects in Buffalo.
68. As a direct and proximate result of the tortious and illegal conduct of
Buffalo, Brown, Smith, Stenhouse, and the Jeremiah Partnership, NRP was no longer
able to claim the benefits of their agreements with members of the Development Team,
the DHCR, the HTFC and others who issued loan commitments and, in turn, the City of
Buffalo.
69. Buffalo, Brown, Smith, Stenhouse and the Jeremiah Partnership
have failed to offer any good faith or legitimate reason for causing Buffalo to breach its
agreement and commitment to the Project.
70. In statements to the media, Brown claims that he refused to support
the Project when he learned of the thirty (30) year rental time period before the single-
family homes would be made available for home ownership.
71. Brown’s purported reason for refusing to support the project is
patently false.
72. Brown was aware that the thirty (30) year durational requirement was
mandatory under applicable law prior to Buffalo’s February 25, 2008 agreement and
commitment for the Project.
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73. Stenhouse is quoted by the media as stating that he never thought
the Project was worthwhile.
74. Stenhouse’s statement is both incredible and false as reflected by his
relentless and persistent efforts in 2009 to have a role on the Project including the
submission of a proposal in response to the RFP.
75. Simply put, Brown, Smith, Stenhouse and the Jeremiah Partnership
conspired to tortiously and illegally kill the Project because the Development Team
refused to comply with the illegal demand that it pay Stenhouse and/or the Jeremiah
Partnership money as a condition for their role in determining whether Buffalo would
honor the February 25, 2008 agreement and commitment.
76. A notice of claim was filed and served upon the municipal defendants
on June 14, 2010, and more than 30 days have passed since the filing of the notice of
claim with the municipal defendants failing to adjust or otherwise pay for the damages
identified within the notice of claim. A copy of the notice of claim is attached as Exhibit
“E.”
77. On November 18, 2010 the municipal defendants conducted the
examination of plaintiffs pursuant to the terms of the General Municipal Law.
78. Plaintiffs have satisfied all conditions precedent under the General
Municipal Law for commencing an action against the municipal defendants.
79. Upon information and belief, the limitations of liability set forth in
Article 16 of the CPLR do not apply to this action.
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COUNT I
Breach of Contract Against Buffalo
80. NRP repeats and re-alleges the allegations set forth in paragraphs 1
through 79 above.
81. NRP is the assignee of all rights and benefits concerning the
February 25, 2008 agreement and commitment.
82. The February 25, 2008 agreement and commitment is an
enforceable contract between Buffalo and NRP.
83. The Development Team satisfied the one condition precedent in the
February 25, 2008 agreement and commitment when they secured the 2008 LIHTC to
complete the Project.
84. Buffalo breached the February 25, 2008 Agreement by, among other
things, failing to: perform the tasks required of it to move the Project forward, extend to
the Project its usual Low Income Housing PILOT agreement, provide $1,600,000.00 of its
HOME funds to assist in the construction of the Project and provide fifty-one buildable
vacant lots by the Project deadline of March 15, 2010.
85. Consequently, NRP is entitled to recover compensatory and other
damages in excess of $450,000.00 together with prejudgment interest.
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COUNT II
Tort Claims Against Buffalo, Brown,

Smith, Stenhouse and the Jeremiah Partnership
through 85 above.
87. NRP is a party to agreements with associated companies concerning
the development, construction and management of homes in connection with the Project.
88. NRP is the assignee of all rights and benefits concerning the
agreements and commitments that are attached hereto at Exhibits “A” – “D”.
knew or should have known of the agreements secured by the Development Team in
order to perform the Project.
employed an unlawful and improper “pay to play” scheme and otherwise engaged in
wrongful and illegal conduct designed to interfere with the Development Team’s rights
under the agreements attached hereto at Exhibits “A” – “D”, other agreements to be
entered into in connection with the Project, and the economic advantages that would
have been realized under all such agreements.
91. Brown, Smith, Stenhouse and the Jeremiah Partnership intentionally
procured Buffalo’s breach of the agreement attached as Exhibit “A” and all defendants
expected and understood that all other contracts referenced herein would not be
performed as a result of their intentional and wrongful conduct set forth in detail above, all
without justification.
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92. The defendants caused an actual breach of the contracts and/or non-
performance thereof and NRP sustained damages as a result.
93. Through their course of dealing with NRP and the Development
Team, the defendants were all aware of prospective contractual and business
relationships by and between plaintiffs and Buffalo and third-parties, and with this
awareness interfered with the business relationships with the sole purpose of harming
NRP or by means that were unlawful or improper.
94. Each defendant, in pursuance of a common plan or design to commit
a tortious act, actively took part in it, or furthered it by cooperation or request, or provided
aid and encouragement to each of the other defendants, or ratified and adopted each of
the other defendant’s acts done for their benefit, and are therefore liable with each of the
defendants. Each defendant acted tortiously and one or more of the defendants
committed an act in pursuance of the common plan, design or agreement which
constitutes a tort.
95. The wrongful and illegal actions and conduct of Buffalo, Brown,
Smith, Stenhouse and the Jeremiah Partnership described in detail above are actionable
under the common law theories of tortious interference with contract and/or prospective
contractual relations, tortious interference with prospective economic advantage and/or
economic relations, and concerted action theory and/or civil conspiracy.
96. Buffalo is not responsible for the claims set forth in paragraph 94
above concerning the agreement attached at Exhibit “A” because it is a party to that
agreement. Buffalo is responsible for the claims set forth in paragraph 94 above
16
concerning the agreements attached hereto at Exhibits “B” through “D” and the
agreements entered into between NRP and other members of the Development Team.
Buffalo is also responsible for the acts of Brown, Smith, and its other employees pursuant
to the doctrine of respondeat superior.
97. Consequently, NRP is entitled to recover compensatory damages of
at least $1,000,000.00 as permitted by law against Buffalo, Brown, Smith, Stenhouse
and the Jeremiah Partnership.
98. The conduct described herein was reckless, wanton, and carried out
in total disregard for the rights of NRP. As a result, NRP is entitled to recover punitive
damages against Brown, Smith, Stenhouse and the Jeremiah Partnership in an amount
to be determined.
COUNT III
RICO Claims Against Brown,

Smith, Stenhouse, and the Jeremiah Partnership
through 98 above.
100. As described above, Brown, Smith, Stenhouse and the Jeremiah
Partnership conspired in various respects including to illegally demand a role for
Stenhouse on certain projects and later to decide whether to cause Buffalo to breach its
agreements and commitments for land development projects depending on whether the
subject land developer complied with their unlawful and illegal demands to pay monies to
Stenhouse and/or affiliated organizations in order for such projects to proceed.
101. Pursuant to the RICO, the “enterprise” is Buffalo.
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102. Pursuant to the RICO, Brown, Smith, Stenhouse and the Jeremiah
Partnership committed multiple acts of “racketeering activity,” as set forth above, in
furtherance of the illegal scheme. Such activities, as described in detail above, involved
interstate commerce and include, but are not limited to, violations of the Hobbs Act, 18
U.S.C. § 1951, 18 U.S.C. § 1341, 18 U.S.C. § 1343, and New York Penal Law § 200 et
seq.
103. Pursuant to the RICO, the illegal activities of Brown, Smith,
Stenhouse and the Jeremiah Partnership constitute a pattern of racketeering activity as a
closed ended and/or open ended continuity and/or because they were used on NRP and,
upon information and belief, other developers involved in certain other projects that
proceeded within the City of Buffalo.
104. Even assuming arguendo that the “pay to play” or “pay for votes”
practice has ended, Brown, Smith, Stenhouse and the Jeremiah Partnership developed
and implemented this practice against NRP and, upon information and belief, others
through numerous threats and demands over a period of more than two years.
105. The illegal activities of Brown, Smith, Stenhouse and the Jeremiah
Partnership constitute a pattern of racketeering activity because, left unchecked, it is
reasonable to expect that such acts were the regular manner in which such persons
exercised their authority within the enterprise and implied a threat of continuing improper
activity. Moreover, left unchecked, the illegal activities of defendants are likely to occur in
the future.
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106. In addition, the illegal activities of Brown, Smith, Stenhouse and the
Jeremiah Partnership constitute a pattern of racketeering activity based on the escalating
demands concerning the role of Stenhouse and the Jeremiah Partnership on the Project
and other development projects in Buffalo. Such escalating demands implied a threat of
continuing criminal activity.
107. Pursuant to the RICO, Brown, Smith, Stenhouse and the Jeremiah
Partnership participated in the affairs of the enterprise through the pattern of racketeering
activity described above.
108. By reason of NRP’s refusal to comply with the illegal demands and
“pay to play” scheme employed by Brown, Smith, Stenhouse and the Jeremiah
Partnership, NRP has been injured in its business and property in the amount of at least
$1,000,000.00.
109. By reason of the foregoing, NRP is entitled to a judgment against
Brown, Smith, Stenhouse and the Jeremiah Partnership for their monetary damages, plus
treble damages, costs and reasonable attorneys’ fees and disbursements incurred in
prosecuting this action.
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COUNT IV
42 U.S.C. §1983 Against Buffalo, Brown and Smith
– 109 above.
111. Buffalo had and/or has an official custom or policy established by
Brown and/or Smith that required NRP to comply with the illegal demand to pay monies to
Stenhouse and/or affiliated organizations in order for the Project to proceed.
112. In applying this official custom or policy to NRP, Buffalo, Brown and
Smith were acting under color of state or local law.
113. Application of this official custom or policy to NRP resulted in
depriving them of their rights protected by the Equal Protection and Due Process clauses
of the United States Constitution.
114. NRP was treated differently than other developers of projects in
Buffalo. When other developers found a way to pay monies to Stenhouse and/or
affiliated organizations, Buffalo, Brown and Smith allowed their projects to proceed to
completion. Because NRP refused to make such payments, Buffalo, Brown and Smith
maliciously and in bad faith intended to injure NRP and actively took steps to kill the
Project.
115. NRP had a binding agreement with Buffalo concerning the Project
pursuant to the February 25, 2008 agreement and commitment. In reliance on that
agreement, NRP fulfilled all necessary conditions and expended considerable sums, time
and resources in order for the Project to proceed. After supporting the Project for over
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eighteen months, Buffalo, Brown and Smith used their positions and influence to prevent
Buffalo from taking the final steps required of it for the completion of the Project. As a
result, NRP was denied due process solely because it refused to comply with the illegal
demand to pay monies to Stenhouse and/or affiliated organizations.
116. The above actions of Buffalo, Brown and Smith have resulted in a
denial of NRP’s federal law rights pursuant to the Equal Protection and Due Process
clauses of the United States Constitution.
117. By reason of the foregoing, NRP is entitled to recover compensatory
damages in an amount in excess of $1,000,000.00 and attorney’s fees against Buffalo,
Brown and Smith, and punitive damages in an amount to be determined against Brown
and Smith.
PRAYER AND DEMAND FOR RELIEF
WHEREFORE, NRP respectfully requests that the Court:
a) On Count I: Enter judgment on behalf of NRP against Buffalo for
compensatory damages in excess of $450,000.00 together with prejudgment interest;
b) On Count II: Enter judgment on behalf of NRP against Brown,
Smith, Stenhouse and the Jeremiah Partnership for compensatory damages in excess of
$1,000,000.00 and punitive damages;
c) On Count III: Enter judgment on behalf of NRP against Brown,
Smith, Stenhouse and the Jeremiah Partnership for compensatory damages in excess of
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$1,000,000.00 together with prejudgment interest, an award of treble damages and
attorneys’ fees and costs pursuant to the RICO;
d) On Count IV: Enter judgment on behalf of NRP against Buffalo,
Brown and Smith for compensatory damages in excess of $1,000,000.00, attorney’s fees
and punitive damages;
e) Awarding NRP its costs, disbursements, and attorneys’ fees; and
f) Awarding NRP such other and further relief as the Court deems just
and proper.
DEMAND IS HEREBY MADE, for a trial by Jury.
Dated: June 3, 2011
WEBSTER SZANYI LLP

Attorneys for Plaintiffs
By: s/ Thomas S. Lane

Thomas S. Lane
Nelson Perel
1400 Liberty Building
Buffalo, New York 14202
Telephone: (716) 842-2800
tlane@websterszanyi.com
nperel@websterszanyi.com
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UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF NEW YORK
NRP HOLDINGS LLC and NRP PROPERTIES LLC
Plaintiffs,
v. RICO CASE
STATEMENT
CITY OF BUFFALO, BYRON W. BROWN, PURSUANT TO
DEMONE A. SMITH, LOCAL RULE 9
RICHARD A. STENHOUSE, and BUFFALO
JEREMIAH PARTNERSHIP FOR COMMUNITY
DEVELOPMENT, INC., JOHN DOE 1 – 10, and
JOHN DOE COMPANIES 1 – 5.
Defendants.
For its RICO Case Statement pursuant to Rule 9 of the Local Rules of Civil
Procedure for the Western District of New York, Plaintiffs NRP Holdings LLC and NRP
Properties LLC (collectively “NRP”), through their attorneys Webster Szanyi LLP, state as
follows:
1. State whether the alleged unlawful conduct is in violation of 18
U.S.C. §§ 1962 (a), (b), (c) and/or (d).
Response: 18 U.S.C. §§1962(c) and 1962(d).
2. List each defendant and state the alleged misconduct and basis
of liability of each defendant.
Response: Defendant Byron W. Brown (“Brown”) was and is the Mayor of
the City of Buffalo (“Buffalo”). Defendant Demone A. Smith (“Smith”) was and is a
member of the Buffalo Common Council. Defendant Richard A. Stenhouse

(“Stenhouse”) was and is the president of the Jeremiah Partnership for Community
Development, Inc. (“Jeremiah Partnership”).
NRP are affiliates of the NRP Group LLC, an Ohio limited liability
corporation that develops, builds and manages apartments and housing across the
United States. Among other honors, the National Association of Home Builders named
the NRP Group LLC as the 2009 multifamily development firm of the year.
In November 2007, NRP was invited by representatives of the City of
Buffalo (“Buffalo”) to participate in a meeting to discuss affordable housing initiatives
within the City of Buffalo. During this meeting, these representatives expressed their
desire to work with NRP and associated companies to build single family homes within
the City of Buffalo.
Effective February 21, 2008, NRP entered into agreements with associated
companies to develop, construct and manage fifty (50) homes in the Masten Park and
Cold Springs neighborhoods of Buffalo (the “Project”). (NRP and its associated
companies are hereafter collectively referred to as the “Development Team.”)
By letter dated February 25, 2008, Buffalo agreed and committed itself to
participate in the Project by, among other things, extending to the Project its usual Low
Income Housing PILOT agreement, providing $1,600,000 of its HOME funds to assist in
the construction and, in addition, providing fifty-one (51) buildable vacant lots at a price
no greater than $2,000 per buildable lot, and not to exceed a total price of $100,000.
2
Buffalo’s agreement and commitment to the Project was subject to one
condition -- the Development Team’s success in securing 2008 Low Income Housing Tax
Credits (“LIHTC”) to complete the Project.
In the February 25, 2008 agreement and commitment letter, Buffalo stated,
among other things, that “[w]e are also supportive of the feature of the development,
which allows for homeownership conversion at the end of the tax required compliance
period. The lease to own component provides future homeownership opportunities to
residents who are not currently prepared to become homeowners, while providing them
with clean, state-of-the-art housing today.”
As of February 25, 2008, Buffalo, Brown and Smith knew that under
applicable law, the tax compliance period referenced in the February 25, 2008 agreement
and commitment was thirty (30) years.
By letter dated August 20, 2008, the Development Team received a
commitment from the New York State Division of Housing and Community Renewal
(“DHCR”) for the necessary LIHTC. The DHCR commitment required “closing on
construction financing sufficient to complete the Project” on or before March 15, 2010.
By letter dated November 5, 2008, the DHCR notified the Development
Team that the amount of the LIHTC was increased from $794,363 to $922,954.
By letter dated November 8, 2008, the New York State Housing Trust Fund
Corporation (“HTFC”) notified the Development Team that the HTFC approved a low
interest loan in the amount of $2,200,000 in support of the Project. (By letter dated March
19, 2009, the HTFC issued its agreement and commitment for the loan.)
3
After receiving the agreements and commitments from Buffalo and the
DHCR, Buffalo moved forward with its participation in the Project in accordance with its
February 25, 2008 commitment and agreement.
For example, Buffalo issued letters in support of the Project and the
application to the DHCR. Buffalo also selected the sites to be used for the single-family
homes. In addition, the City of Buffalo Planning Board “approved as presented”, the site
plan, design and elevations submitted by the Development Team.
In early 2009, however, Brown, Smith, Stenhouse and the Jeremiah
Partnership demanded that the Development Team contract with Stenhouse and/or
organizations connected to Stenhouse (including the Jeremiah Partnership) to participate
in the Project.
The Development Team was told that the participation of Stenhouse was
required in order to assure adequate minority involvement in the Project.
The Development Team was specifically instructed that it was necessary to
“find a role for Stenhouse” and “make Stenhouse happy” in order for the Project to
proceed.
Initially, Stenhouse simply indicated an interest to make sure that there was
adequate minority involvement in the Project. Thereafter, Stenhouse communicated a
series of escalating demands. Instead of unofficial input, Stenhouse then demanded a
series of tasks involving ever increasing payments to him and later the Jeremiah
Partnership. Eventually, Stenhouse asked whether he could be a partner on the Project
similar to the arrangement he had on the Packard project, a prior project within the City of
4
Buffalo, where he was paid a “developer’s” fee. Stenhouse then demanded that the
Development Team accept his response to a Request for Proposal, discussed below,
even though it was inferior to the bid selected by the Development Team.
The Development Team was told that, because Stenhouse did not have an
acceptable contract on the Project, several items promised by Buffalo were being held up
in Brown’s office.
Despite these threats and demands, the Development Team believed that
they should issue a Request For Proposal (“RFP”) to satisfy the purported need for an
independent contractor on the Project devoted to minority involvement issues even
though members of the Development Team were already providing such services.
In April 2009, the Development Team issued the RFP for a provider to
assist it in maximizing participation in the Project by local minority business enterprises,
women-owned business enterprises and individuals. The RFP was mailed to over thirty
(30) organizations and an advertisement was placed in the Buffalo News. Stenhouse and
the Jeremiah Partnership were advised of the RFP and invited to respond. The
Development Team received three (3) proposals including one from Stenhouse and the
Jeremiah Partnership. After a thorough review of the proposals, the Development Team
selected the proposal submitted by the University of Buffalo – Center for Urban Studies in
conjunction with J.W. Pitts Planning (collectively referred to as the “UB Team”). The
proposal by the UB Team ranked far superior to the others and was more reasonably
priced.
5
In April 2009, Buffalo issued site plan approval and a permit ready letter for
the Project. In the same month, the DHCR issued environmental and plan approvals for
the Project. By this time, the Development Team had incurred considerable expense
and performed all tasks necessary to move forward with the Project.
After selecting the UB Team and rejecting the proposal submitted by
Stenhouse and the Jeremiah Partnership, the Project was stalled and ultimately killed by
Brown, Smith, Stenhouse and the Jeremiah Partnership.
Brown, Smith, Stenhouse and the Jeremiah Partnership used their positions
and influence to cause Buffalo to breach its February 25, 2008 agreement and
commitment to the Project because the Development Team refused to comply with the
illegal demand that they pay monies to Stenhouse and/or affiliated organizations in order
for the Project to proceed.
In making the illegal demand, Brown said: “If you do not hire the right
company [i.e. Stenhouse and/or the Jeremiah Partnership], you do not have my support
for the Project.” He also said: “Make Stenhouse happy or the deal will not go through”
and further stated that he was “sick of seeing those fucking white developers on the East
Side with no black faces represented.” After the Development Team selected the UB
Team instead of Stenhouse, Brown said: “I told you what you had to do and you hired the
wrong company.” Smith made similar statements. Upon information and belief,
Stenhouse and the Jeremiah Partnership demanded a role on the Project because of
their past endorsement of Brown as Mayor and in consideration for their future
endorsement of Brown. 2009 was an election year. Upon information and belief, Brown
6
and Smith intended to reward Stenhouse and the Jeremiah Partnership for their past
endorsement and support and viewed the continuing endorsement by Stenhouse and the
Jeremiah Partnership as integral to Brown’s re-election efforts in 2009.
The illegal schemes implemented by Brown, Smith, Stenhouse and the
Jeremiah Partnership against NRP continued until March 15, 2010, when NRP was
unable to meet the deadline for closing on construction financing sufficient to complete
the Project and, as a result, the Project could no longer be completed.
Buffalo, Brown, Smith, Stenhouse and the Jeremiah Partnership have failed
to offer any good faith or legitimate reason for causing Buffalo to breach its agreement
and commitment to the Project.
In statements to the media, Brown claims that he refused to support the
Project when he learned of the thirty year rental time period before the homes would be
made available for home ownership. Brown’s purported reason is patently false. Brown
was aware that the thirty year durational requirement was mandatory under applicable
law prior to Buffalo’s February 25, 2008 agreement and commitment for the Project.
Stenhouse is quoted by the media as stating that he never thought the
Project was worthwhile. Stenhouse’s statement is both incredible and false as reflected
by his ongoing and persistent efforts in 2009 to have a role on the Project including the
submission of a proposal in response to the RFP.
3. List the alleged wrongdoers, other than the defendants listed
above, and state the alleged misconduct of each wrongdoer.
7
Response: Other than the defendants listed above, NRP is presently
unaware of any other entities or persons that participated in the alleged wrongdoing
described in the previous response. NRP believes others may have been involved and,
for this reason, has named John Doe individuals and John Doe Companies as
defendants in the complaint.
4. List the alleged victims and state how each victim was allegedly
injured.
Response: NRP and the Development Team were the victims. As a
direct and proximate result of the illegal conduct of Brown, Smith, Stenhouse and the
Jeremiah Partnership, NRP was no longer able to claim the benefits of their agreements
with members of the Development Team, the DHCR, the HTFC and others who issued
loan commitments and, in turn, Buffalo. As a result, the Development Team incurred
injury to its business and property in excess of $1,000,000.00.
5. Describe in detail the pattern of racketeering activity or
collection of unlawful debts alleged for each RICO claim.
(A) List the alleged predicate acts and the specific statutes
which were allegedly violated;
(B) Provide the dates of the predicate acts, the participants in

the predicate acts, and a description of the facts
surrounding the predicate acts;
(C) If the RICO claim is based on the predicate offenses of

wire fraud, mail fraud, or fraud in the sale of securities the
“circumstances constituting fraud or mistake shall be
stated with particularity.” Fed. R. Civ. P. 9(b), Identify the
time, place and contents of the alleged
misrepresentations, and the identity of persons to whom
and by whom the alleged misrepresentations were made;
8
(D) State whether there has been a criminal conviction for

violation of each predicate set;
(E) State whether civil litigation has resulted in a judgment in

regard to each predicate act;
(F) State whether the alleged predicate acts relate to each

other as part of a common plan. If so, describe in detail.
Response: The illegal schemes developed and implemented by Brown,
Smith, Stenhouse and the Jeremiah Partnership are commonly known as a “pay to play”
and “pay for votes” scheme.
Over the period November 2007 to March 2010, Brown, Smith, Stenhouse
and the Jeremiah Partnership developed and implemented a conspiracy which included
inviting NRP to Buffalo to develop the Project and then failing to complete actions
required by Buffalo and withholding Buffalo’s final approval unless NRP and the
Development Team complied with their illegal demands to pay money to Stenhouse
and/or the Jeremiah Partnership. When the Development Team refused to comply with
those illegal demands, Brown, Smith, Stenhouse and the Jeremiah Partnership conspired
to cause Buffalo to breach its agreement and commitment by, among other things, failing
to provide funds and lots within the deadlines necessary for the Project to proceed.
Through telephonic communications, U.S. Mail, electronic communications,
e-mails, and direct statements, Brown, Smith, Stenhouse and the Jeremiah Partnership
made clear that the Project would not proceed unless the Development Team paid money
to Stenhouse and the Jeremiah Partnership.
9
Upon information and belief, Brown, Smith, Stenhouse and the Jeremiah
Partnership conditioned Buffalo’s support for other development projects that proceeded
within Buffalo on those projects finding a role for and/or the payment of monies to
Stenhouse and/or the Jeremiah Partnership. Upon information and belief, in situations
where development projects found a role for Stenhouse and/or the Jeremiah Partnership
on their teams, Buffalo honored its agreements and commitments on those projects.
Upon information and belief, the role of Stenhouse and/or the Jeremiah Partnership in
certain other development projects was essentially a “no show” job where Stenhouse
and/or the Jeremiah Partnership added little or no value to the projects.
Upon information and belief, Stenhouse did not have development
experience. As a result, the Mayor’s office often directed City employees to work directly
with Stenhouse at City expense to provide services and the expertise that he lacked even
though Stenhouse was being paid to provide such services.
Upon information and belief, the Packard project, which commenced in or
about 2006, is another example where the individual defendants conspired to find a role
for Stenhouse as a condition for approving a development project in Buffalo. In that
project, Stenhouse became a “partner” on the development project and earned a
developer’s fee. Indeed, upon information and belief, Stenhouse provide no services of
value to the Packard project.
Upon information and belief, East Side Housing Opportunities, Phase I is
another example of where the individual defendants conspired to demand a role for
Stenhouse and/or his affiliated companies as a condition for approving a development
10
project in Buffalo. NRP was not involved in this Phase I project but has learned that
Stenhouse’s participation in the project added little to no value. Despite the lack of any
meaningful contribution to this project, Stenhouse was paid a significant fee at the
insistence of the defendants.
Prior to filing this case, NRP submitted a Freedom of Information Law
request to Buffalo requesting, among other things, all documents in Buffalo’s possession
concerning Stenhouse and the Jeremiah Partnership. The request was intended to
determine the precise involvement of Stenhouse and the Jeremiah Partnership
concerning other development projects in Buffalo. In response, Buffalo first delayed and
then refused to produce documents in Buffalo’s possession concerning Stenhouse and
the Jeremiah Partnership. Discovery is necessary to determine the full extent of the role
of Stenhouse and the Jeremiah Partnership in the Packard project, the East Side Housing
Opportunities, Phase I project, and other development projects in Buffalo.
The foregoing predicate acts are violations of the Hobbs Act, 18 U.S.C. §
1951 and New York Penal Law § 200 et seq., 18 U.S.C. § 1341 and 18 U.S.C. § 1343.
Based on the predicate acts committed against NRP and the Development
Team and, upon information and belief, other developers in Buffalo, the RICO pattern in
this case involves closed-ended and open-ended continuity. Even assuming, arguendo,
the “pay to play” practice has ended, Brown Smith, Stenhouse and the Jeremiah
Partnership developed and implemented this practice against NRP and others through
numerous threats and demands over a time period of more than two years. The scheme
11
also included repeated misrepresentations concerning the purported role of Stenhouse
and the Jeremiah Partnership in connection with development projects in Buffalo.
By its nature, a “pay to play” scheme involving high ranking political officials
satisfies the test for open-ended continuity. It is reasonable to infer that such predicate
acts were the regular way in which such persons exercised their authority within the
enterprise and implied a threat of continuing criminal activity. In the case of NRP and the
Development Team, for example, Brown, Smith, Stenhouse and the Jeremiah
Partnership would have allowed the Project to proceed if NRP and the Development
Team agreed to pay Stenhouse and the Jeremiah Partnership. NRP and the
Development Team, however, were stalled and suffered significant economic losses
because they would not comply with or participate in the illegal schemes.
The RICO claim includes but is not limited to predicate offenses of mail and
wire fraud. In turn, the offenses of mail and wire fraud include but are not limited to the
following specific events. Upon information and belief, Brown, Smith, Stenhouse and the
Jeremiah Partnership developed and implemented the “pay to play” conspiracy when
NRP was invited to develop the Project in November 2007, and thereafter. By letter
dated February 25, 2008, Buffalo’s agreement and commitment to the Project was
subject to one condition – the Development Team’s success in securing LIHTC to
complete the Project. This letter was false because Brown, Smith, Stenhouse and the
Jeremiah Partnership conspired to impose the additional condition requiring the
Development Team to hire Stenhouse and the Jeremiah Partnership. The Development
Team relied on the February 25, 2008 letter and successfully obtained the LIHTC.
12
Starting in early 2009, Stenhouse made a series of escalating demands concerning the
need for his involvement in the Project. These demands included mailings and e-mails to
the Development Team stating terms for the involvement of himself and the Jeremiah
Partnership on the Project. In April-May 2009, Stenhouse and the Jeremiah Partnership
responded to the RFP by U.S. Mail, again stating terms for the involvement of Stenhouse
and the Jeremiah Partnership. Each of these “proposals” was false and misleading
because they were not offers subject to fair and open competition with other potential
vendors of similar services. Rather, they were threats and demands that the
Development Team was obligated to accept. As the Development Team learned, if it
refused to accept the proposals, then Brown, Smith, Stenhouse and the Jeremiah
Partnership would make sure that the Project died. In 2010, Brown and Stenhouse made
repeated statements that were intended for publication (and in fact were published over
the air waves) falsely stating the reasons why they killed the Project. Throughout, all
defendants also engaged in related communications by telephone, mail, and electronic
transmission.
NRP is unaware of any criminal conviction or other civil litigation resulting in
a judgment in relation to any of the alleged predicate acts.
6. Describe in detail the alleged enterprise for each RICO claim.
(A) State the names of the individuals, partnerships,

corporations, associations, or other legal entities, which
allegedly constitute the enterprise;
(B) Describe the structure, purpose, function and course of

conduct of the enterprise;
13
(C) State whether any defendants are employees, officers or

directors of the alleged enterprise;
(D) State whether any defendants are associated with the

alleged enterprise;
(E) State whether you are alleging that the defendants are
individuals or entities separate, from the alleged
enterprise, or that the defendants are the enterprise itself,
or members of the enterprise; and
(F) If any defendants are alleged to be the enterprise itself, or

members of the enterprise, explain whether such
defendants are perpetrators, passive instruments, or
victims of the alleged racketeering activity.
Response: The enterprise is Buffalo. At all relevant times, Brown, Smith,
Stenhouse and the Jeremiah Partnership used Buffalo as a passive instrument for their
personal benefit, i.e. by developing and implementing a “pay to play” and “pay for votes”
scheme to further political careers and/or for their personal benefit. Brown and Smith are
public officials of Buffalo.
7. State and describe in detail whether you are alleging that the
pattern of racketeering activity and the enterprise are separate or have merged into
one entity.
Response: The enterprise, Buffalo, existed prior to the pattern of
racketeering activity, and exists as a legitimate entity. Accordingly, the pattern of
racketeering conducted by Brown, Smith, Stenhouse and the Jeremiah Partnership
through their association with Buffalo is separate from the enterprise and has not merged
into a single entity.
14
8. Describe the alleged relationship between the activities of the
enterprise and the pattern of racketeering activity. Discuss how that racketeering
activity differs from the usual and daily activities of the enterprise, if at all.
Response: The enterprise, Buffalo, issued the February 25, 2008
agreement and commitment letter. This letter included one condition, namely the
Development Team was obligated to secure the LIHTC. Despite the Development
Team’s compliance with this condition, Buffalo did not perform under the agreement and
commitment letter because Brown, Smith, Stenhouse and the Jeremiah Partnership
required another condition, namely the Development Team’s obligation to pay money to
Stenhouse and/or the Jeremiah Partnership. Such a “pay to play” or “pay for votes”
scheme is contrary to the usual and daily lawful activities of Buffalo.
9. Describe what benefits, if any, the alleged enterprise receives
from the alleged pattern of racketeering.
Response: In this case, the enterprise, Buffalo, is a passive instrument
through which Brown, Smith, Stenhouse and the Jeremiah Partnership wielded power for
their personal political and economic benefit.
10. Describe the effect of the activities of the enterprise on
interstate or foreign commerce.
Response: NRP and its affiliate the NRP Group, LLC are Ohio entities
that develop, build and manage apartments and housing across the United States. As
such, the predicate acts described above affected efforts by these Ohio entities to
15
conduct business in the State of New York and, therefore, has a direct impact on
interstate commerce.
11. If the complaint alleges a violation of 18U.S.C. § 1962(a), provide
the following information:
(A) State who received the income derived from the pattern of
racketeering activity or through the collection of an
unlawful debt; and
(B) Describe the use or investment of such income.
Response: Not applicable because there is no allegation of a violation of
18 U.S.C. § 1962(a).
12. If the complaint alleges a violation of 18 U.S.C. § 1962(b),
describe in detail the acquisition or maintenance of any interest in or control of the
alleged enterprise.
Response: Not applicable because there is no allegation of a violation of
18 U.S.C. § 1962(b).
13. If the complaint alleges a violation of 18 U.S.C. 1962(c), provide
the following information:
(A) State who is employed by or associated with the enterprise; and
(B) State whether the same entity is both the liable “person” and
the “enterprise” under § 1962(c).
Response: As described above, Brown was and is the Mayor of Buffalo.
Smith was and is a member of the Buffalo Common Council. Stenhouse and the
Jeremiah Partnership were and are associated with Buffalo based on their relationship
with Brown and Smith. Buffalo is a passive instrument through which Brown, Smith,
16
Stenhouse and the Jeremiah Partnership wielded power for their personal political and
economic benefit.
14. If the complaint alleges a violation of 18 U.S.C.§ 1962(d),
describe in detail the alleged conspiracy.
Response: The members of the conspiracy are Brown, Smith, Stenhouse
and the Jeremiah Partnership. These persons conspired to develop and implement pay
to play or pay for votes schemes described in detail above.
15. Describe the alleged injury to business or property.
Response: NRP suffered injury to its business and property. As a result
of the defendants’ illegal schemes, NRP was no longer able to claim the benefits of their
agreements with members of the Development Team, the DHCR, the HTFC and others
who issued loan commitments and, in turn, Buffalo. As a result, NRP incurred injury to its
business and property consisting of out of pocket expenses, lost profits including rental
revenues and anticipated sales of units, lost business opportunities, and other damages
to be determined. For example, the lost out of pocket expenses exceed $450,000.00.
Other compensatory damages are expected to exceed $1,000,000.00.
16. Describe the direct causal relationship between the alleged
injury and the violation of the RICO statute.
Response: By refusing to comply with the “pay to play” threats and
demands, NRP and the Development Team were unable to claim the benefits of the
17
agreements described in the previous paragraph and suffered injury and damages as a
result.
17. List the damages sustained for which each defendant is
allegedly liable.
Response: Brown, Smith, Stenhouse and the Jeremiah Partnership are
jointly and severally liable for the damages suffered by NRP and the Development Team.
Such damages include the out of pocket expenses, lost profits including lost rental
revenues and anticipated sales of units, lost business opportunities and other damages to
be determined.
18. List all other federal causes of action, if any, and provide the
relevant statute numbers.
Response: Count I of the Complaint asserts a breach of contract claim
against Buffalo. Count II of the Complaint asserts claims under common law theories of
tortious interference with contract and/or prospective contractual relations, tortious
interference with prospective economic advantage and/or economic relations and
concerted action theory and/or civil conspiracy. These Counts are federal claims
because the Court’s subject matter jurisdiction over these Counts is based on diversity of
citizenship pursuant to 28 U.S.C. § 1332. Count IV of the Complaint asserts a federal law
claim pursuant to 42 U.S.C. §1983.
19. List all pendent state claims, if any.
Response: Count I of the Complaint asserts a breach of contract claim
against Buffalo. Count II of the Complaint asserts state claims under the common law
18
theories of tortious interference with contract and/or prospective contractual relations,
tortious interference with prospective economic advantage and/or economic relations and
concerted action theory and/or civil conspiracy. As stated in the previous response, these
claims fall under the federal court’s diversity jurisdiction even though state law provides
the applicable substantive law.
20. Provide any additional information that you feel would be
helpful to the Court in processing your RICO claim.
Response: The following provides a succinct summary of the case
including additional information, stated upon information and belief, that NRP believes
would be helpful to the Court in processing the claim.
What is the Lawsuit About:

NRP filed litigation in the United States Federal Court for the Western District of New
York against the City of Buffalo and others (the “defendants”) as a result of the
defendants’ intentional and ultimately successful efforts to kill an affordable housing
project. In 2007, the defendants invited NRP to assist the City of Buffalo in expanding the
affordable housing options available to its residents. After two initial meetings, the City
selected NRP and affiliated companies (the “Development Team”) to develop, construct,
and manage 50 homes in the Masten Park and Cold Springs neighborhoods of Buffalo
(the “project”). The City issued a firm commitment letter to the project and contractually
obligated itself to take the actions necessary to assist NRP and the Development Team to
complete the project. In consideration of this, and specifically at the request of the City,
NRP undertook great efforts and incurred significant expenses to move the project
forward to completion. In addition to its expenditures, NRP devoted thousands of man
hours to the project. In the late stages of the project, the defendants demanded that NRP
hire Reverend Richard Stenhouse and the Buffalo Jeremiah Partnership For Community
Development, Inc. as a sub-contractor for the project to perform certain services to assist
19
NRP in maximizing participation in the project by local minority business enterprises,

women-owned business enterprises and individuals. After considering the demand, NRP
determined that it should place the services out for public bid and issued a Request for
Proposal (RFP) to the public. Rev. Stenhouse and the Jeremiah Partnership were invited
to respond, and were among three entities to respond to the RFP. At the end of the RFP
process, Rev. Stenhouse was not selected to provide any services for the project. Upset
that Rev. Stenhouse was not selected and that NRP did not comply with their prior
demand to hire Rev. Stenhouse, the defendants, including Mayor Brown and Council
Member Demone Smith, intentionally killed the project and, through their direct actions,
ensured that it would not proceed to completion.
Why was the Lawsuit Filed:

The lawsuit was filed because NRP believes that the defendants’ conduct in killing the
project was wrongful and illegal. In the course of demanding that NRP hire Rev.
Stenhouse to participate in the project, the defendants made certain statements that
caused NRP to believe it was the target of a “pay to play” scheme. For example, Mayor
Byron Brown said: “If you do not hire the right company [i.e., defendant Stenhouse
and/or the Jeremiah Partnership], you do not have my support for the Project.” He also
said: “Make Stenhouse happy or the deal will not go through” and that he was “sick of
seeing those f***ing white developers on the East Side with no black faces represented.”
After the Development Team selected an alternative bidder instead of Rev. Stenhouse,
Brown said: “I told you what you had to do and you hired the wrong company.” Council
Member Demone Smith made similar statements. Rev. Stenhouse also contacted NRP.
His initial contact appeared benign until he, through the course of events, made
escalating demands for a role in the project all of which required the payment of
significant sums of money to Rev. Stenhouse and his affiliated companies. NRP’s refusal
to comply with the defendants’ demands was the sole reason for the defendants killing
the project. Although the defendants would later claim they knew little about the project
or never supported the concept of the project, the facts alleged in the complaint
demonstrate that these are sham excuses contrived in an effort to conceal the alleged
20
illegal conduct of the defendants. Unfortunately, this is not the first time that the
defendants have demanded that an entity intending to do business in the City of Buffalo
hire Rev. Stenhouse as a condition for City support. NRP’s investigation has revealed
that other business entities have been subjected to similar demands that they hire Rev.
Stenhouse and his affiliated companies in order to complete other development projects
within the City of Buffalo.
What Legal Claims Are Alleged in the Lawsuit:

NRP has alleged several claims in the complaint including breach of contract, violations
of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), violations of NRP’s
constitutionally protected right to conduct business within the City of Buffalo without being
subjected to illegal demands by City employees, and several claims related to applicable
business torts.
What are the Goals of the Lawsuit:

There are three goals of the lawsuit: deterrence, increased awareness, and recovery of
damages. First and foremost, NRP believes that the defendants’ conduct should not be
repeated. No developer or business should be subjected to a “pay to play” scheme in
order to carry out business with and in the City of Buffalo. Both the filing of this lawsuit
and the expected successful resolution of the lawsuit should serve a deterrent to the
defendants and others who may hold public office in the City of Buffalo from engaging in
similar conduct in the future. Second, NRP hopes to raise awareness of the alleged
wrongful conduct and to encourage others who have been treated in a similar manner to
come forward. Third, NRP is entitled to be compensated for the damages it incurred as a
result of the alleged wrongful conduct by the defendants. The law provides very clear
remedies for a party who has been harmed by the actions of another. NRP is pursuing
only those legal remedies which are available to it under the law. In this case, NRP is
seeking to recover for its lost out of pocket expenses, compensatory and consequential
damages, punitive or treble damages, and the attorney’s fees it has and will incur in
prosecuting this action and enforcing its legal rights and remedies.
21
Conclusion:
Parties such as NRP should not have their development projects in Buffalo conditioned
on illegal demands and threats to pay money to Stenhouse and the Jeremiah Partnership
(or any other person or entity) in order to have those projects approved by publicly
elected officials. In such circumstances, the federal courts routinely recognize the
availability of RICO to provide a federal claim in favor of such parties against persons
attempting to extort compliance with such a “pay to play” scheme. See, e.g., DeFalco v.
Bernas, 244 F.3d 286 (2nd Cir. 2001); Santana v. Cook County Board of Review, 2010
WL 3937483 (N.D. Ill. Oct. 6, 2010); Empress Casino Joliet Corp. v. Blagojevich, 674 F.
Supp. 2d 993 (N.D. Ill. 2009).
NRP reserves its right to supplement this case statement, to the extent
necessary and/or required by Court rules, following the receipt of discovery information
from the defendants.
Dated: June 3, 2011
WEBSTER SZANYI LLP

Attorneys for Plaintiffs
By: s/ Thomas S. Lane

Thomas S. Lane
Nelson Perel
1400 Liberty Building
Telephone: (716) 842-2800
tlane@websterszanyi.com
nperel@websterszanyi.com
22
ADR PLAN
WESTERN DISTRICT OF NEW YORK
Revised: Jan. 1, 2008
SECTION 1 - INTRODUCTION AND AUTHORITY
1.1 TITLE
This is the Plan for Alternative Dispute Resolution in the United States District
Court for the Western District of New York (the “ADR Plan”).
1.2 PURPOSE AND SCOPE
A. Purpose. The United States District Court for the Western District of New
York (the “Court”) adopted the ADR Plan on January 1, 2006 (the “Effective
Date”), to make available to civil litigants court-administered ADR
interventions and processes designed to provide quicker, less expensive and
potentially more satisfying alternatives to continuing litigation, without
impairing the quality of justice or the right to trial.
B. Scope. This ADR Plan applies to civil actions pending or commenced on and
after the Effective Date, except as otherwise indicated herein. The ADR Plan
supplements this Court’s Local Rules of Civil Procedure, which shall remain
in full effect for all cases.
C. Magistrate Judge Consent Cases. Consistent with Local Rule of Civil

Procedure 72.1, in cases where the parties have consented to jurisdiction by
a Magistrate Judge under 28 U.S.C. § 636, the Magistrate Judge shall have
the same powers as the District Court Judge originally assigned to the case.
D. Plan Administration.
1. Staffing. The Court will seek funding for staff to coordinate and
implement the ADR Plan. In the interim, the Court will utilize current
staff and seek volunteers to assist in implementation.
2. ADR Information and Guidelines. Information about the ADR Plan,

the Court’s proposed Local Rule for mediation and guidelines for the
conduct of ADR are available at http://www.nywd.uscourts.gov/adr/
and also at the Court Clerk’s office.
1
3. All inquiries about the ADR Plan should be directed to:
Judy S. Hernandez, Staff Attorney

U.S. District Court
68 Court Street
Telephone: (716) 332-7826

Fax: (716) 332-7825
e-mail: Judy Hernandez@nywd.uscourts.gov
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SECTION 2 - OVERVIEW
2.1 REFERRAL TO ADR
A. New Cases. All civil cases filed on and after the Effective Date of the ADR
Plan shall be referred automatically for ADR. Notice of the ADR
requirements will be provided to all parties immediately upon the filing of a
complaint and answer or a notice of removal. ADR intervention will be
scheduled at the conference held pursuant to Local Rule of Civil Procedure
16.1. The following categories of actions are exempted from automatic
referral:
1. Habeas Corpus and extraordinary writs;

2. Applications to vacate a sentence;
3. Social Security appeals;
4. Bankruptcy appeals;
5. Cases implicating issues of public policy, exclusively or predominantly;
6. IRS summons enforcement actions;
7. Government foreclosure actions;
8. Civil asset forfeiture actions; and
9. Prisoner civil rights actions.
B. Pending Cases. The assigned Judge on any pending civil case may, sua
sponte or with status conference, issue an order referring the case for ADR.
The order shall specify a date on which the ADR intervention is to be
completed.
C. Stipulation. A case may be referred for ADR by stipulation of all parties.

Stipulations shall be filed and shall designate the specific ADR intervention
the parties have selected, the time frame within which the ADR process will
be completed and the selected Neutral. Stipulations are presumed
acceptable unless the assigned Judge determines that the interests of
justice are not served.
2.2 RELIEF FROM ADR REFERRAL
A. Opting Out Motions. Any party may file, with the assigned Judge for that
case, a motion to opt out of, or for relief from, ADR.
3
B. Motion. Opting Out Motions must be made within ten (10) days from (i) the
date of the first discovery conference under Local Rule 16.1 in new cases,
or (ii) the date of a sua sponte ADR Referral Order in pending cases.
C. Criteria. Opting Out Motions shall be granted only for “good cause” shown.
Inconvenience, travel costs, attorney fees or other costs shall not constitute
“good cause.” A party seeking relief from ADR must set forth the reasons
why ADR has no reasonable chance of being productive.
D. Judicial Initiative. The assigned Judge may, sua sponte, exempt any case
from the Court's ADR Plan.
2.3 VIOLATIONS OF THE ADR PLAN
A. Report of Violation. A Neutral or party may report to the assigned Judge

any failure to attend an ADR conference, to substantially comply with the
ADR Referral Order, or to otherwise participate in the ADR process in good
faith.
B. Proceedings and Sanctions in Response to Report of Violation. Upon

receipt of such a report, the Court may take whatever actions it deems
appropriate, including issuing an order to show cause why sanctions should
not be imposed. Show cause hearings shall be conducted on the record,
but under seal. If sanctions are imposed, objections thereto and any other
comment thereon shall be filed with the Court within ten (10) days from the
date of the notice of sanctions and contemporaneously served on all other
counsel, unrepresented parties and the Neutral.
2.4 EVALUATION OF THE ADR PLAN
Congress has mandated that the Courts’ ADR programs be evaluated. Neutrals,
counsel and parties shall promptly respond to any request from the Court for an
evaluation of the ADR Plan. Responses will be used for research and monitoring
purposes only. The sources of specific information will not be disclosed to the
assigned Judge or in any report.
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SECTION 3 - NEUTRALS
3.1 NEUTRALS
A. Neutral Panels. The Court shall maintain panels of Neutrals to serve the
various interventions and processes under the ADR Plan. Membership on
any panel is a privilege, not a right. The Court shall have the authority to
establish qualifications for Neutrals, monitor their performance and
withdraw any Neutral from a panel. Applications are available at the
Court’s website and from the Clerk’s offices in Buffalo and Rochester.
B. Private Neutrals. The parties may select a Neutral who is not a member of
the Court’s panel. Such selections are presumed acceptable unless the
assigned Judge determines that the interests of justice are not served.
C. Qualifications and Training. The requirements for panel membership are

specific to each intervention and process under the ADR Plan and are set
forth in the corresponding sections below.
D. Oath. All persons serving as Neutrals shall take the oath or affirmation
prescribed in 28 U.S.C. § 453.
E. Disqualification and Unavailability of Neutrals.
1. Disqualification. A Neutral may be disqualified for bias or prejudice,

pursuant to 28 U.S.C. § 144. A Neutral shall disqualify himself or
herself in any case in which a justice, judge or magistrate judge
would be disqualified pursuant to 28 U.S.C. § 455, subject to the
waiver provision of 42 U.S.C. § 455(e).
2. Notice of Recusal. A Neutral who discovers a circumstance requiring

disqualification shall immediately notify all counsel, unrepresented
parties and the Court. A new Neutral shall be selected by agreement
of the parties or, in the event the parties are unable to agree, by the
Court.
3. Objections to Selected Neutral. Prior to the issuance of an Order

designating a Neutral, the Court will contact the selected Neutral who
will review the case for possible conflicts. Following issuance of the
Court’s Order, a party who believes a disqualifying conflict exists
should first confer with the Neutral. If the matter is not resolved by,
for example, waiver or recusal, a motion and supporting affidavit shall
be filed with the Court, within ten [10] days from the Court’s Order,
stating the facts and the reasons for the belief that a disqualifying
5
conflict, bias or prejudice exists. In the event a conflict or other

objection does not become apparent until after the ADR process has
commenced, a motion for disqualification must be made at the
earliest opportunity or the objection is waived.
4. Unavailability. A selected Neutral who later becomes unable to serve

within the time period set forth in the Court’s Scheduling or Referral
Order shall notify all counsel, unrepresented parties and the Court.
A new Neutral shall be selected by agreement of the parties or, in the
event the parties are unable to agree, by the Court.
3.2 IMMUNITIES
All persons serving as Neutrals in the Court’s ADR Plan are performing quasi-
judicial functions and are entitled to all the immunities and protections that the law
accords to the performance of tasks integrally related to the judicial process,
including settlement and alternative dispute resolution. See, e.g., Wagshal v.
Foster, 28 F.3d 1249 (D.C. Cir. 1994).
3.3 COMPENSATION OF NEUTRALS
A Neutral’s fees shall be shared equally by all separately represented parties, unless
otherwise agreed by the parties or ordered by the Court.
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SECTION 4 - APPROVED ADR PLAN INTERVENTIONS
4.1 ADR INTERVENTIONS
A. Options. It is expected that cases referred for ADR will proceed to

Mediation. However, the following options are also available upon the
stipulation of all parties:
1. Neutral Evaluation;
2. Mini Summary Trial;
3. Arbitration (Binding and Non-Binding);
4. Case Valuation; and
5. Settlement Week, when scheduled by the Court.
B. Timing. Timing is specific to the intervention and process chosen, as set

forth in the corresponding sections below.
C. Scheduling. The referral of a case to ADR does not delay or defer other
dates established in the Scheduling Order and has no effect on the
scheduled progress of the case toward trial.
4.2 SELECTING AN ADR INTERVENTION
A. New Cases. Prior to the Local Rule 16.1 scheduling conference, counsel
and any unrepresented parties shall confer about ADR as part of their
discussion of “the possibilities for a prompt settlement or resolution of the
case” pursuant to Fed. R. Civ. P. 26(f). Unless the parties agree to a
different intervention, it is presumed that they will participate in mediation.
The parties shall attempt to agree upon a Neutral and, at the scheduling
conference, shall be prepared to report on the outcome of their ADR
discussion pursuant to Local Rule 16.1(a)(3)(F). The initial Scheduling
Order shall include a deadline for the completion of ADR.
B. Pending Cases. In pending cases, all sua sponte referrals will be to

mediation. Should the parties agree that a different ADR intervention is
more appropriate to their case, they may submit a stipulation designating
the specific ADR intervention selected, the time frame within which the
ADR process will be completed and the identity of the Neutral. Stipulations
must be filed within fifteen (15) days from the date of the ADR Referral
Order and are presumed acceptable unless the assigned Judge determines
that the interests of justice are not served.
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4.3 MULTIPLE ADR INTERVENTIONS
A. Initial Intervention. Generally, a first mediation session will be scheduled

within seventy-five [75] days after the Local Rule 16.1 conference. The
minimum duration for the first session is two [2] hours, but the parties are
encouraged to spend additional time unless the Mediator agrees that
additional time would not be productive.
B. Additional Interventions. If the initial mediation session is not successful

in resolving the case, additional sessions or process will be scheduled as set
forth below:
1. By the Mediator. The Mediator will, in consultation with the parties,

schedule subsequent sessions as needed to explore and evaluate the
possibility of reaching a mutually acceptable resolution. It is
anticipated that the parties will engage in at least two mediation
sessions. Additional sessions must be conducted within the date for
completion of ADR set forth in the Court’s Scheduling or Referral
Order.
2. By Stipulation. If, after the initial mediation session, the parties

agree that an intervention other than mediation may be of benefit in
resolving the case, they must submit a stipulation consistent with
4.2(B) and the stipulation will be presumed acceptable unless the
4.4 CONFIDENTIALITY
Each of the interventions and processes under this ADR Plan shall be confidential
as set forth in the corresponding sections below.
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SECTION 5 - MEDIATION
5.1 DESCRIPTION OF MEDIATION AND ITS PROCESS
Mediation, as defined in proposed Local Rule 16.2-1 and as further detailed herein,
is a flexible, non-binding, confidential process in which a qualified Neutral, the
Mediator, facilitates resolution of the issues between the parties and assists with
settlement discussions. Through various methods and techniques, the Mediator
seeks to improve communication between the participants (parties, counsel,
experts or whoever is included in the mediation); helps participants articulate their
interests; helps participants understand the interests of the other participants,
including their “opponent;” probes the strengths and weaknesses of each party’s
legal positions; and helps generate and define options for a mutually agreeable
resolution. The Mediator may engage in “reality checking,” but will not give an
overall evaluation of the case unless requested by all the parties. The Mediator has
no fact-finding or decision-making authority. The central tenet of mediation is that
the parties find their own solutions, with the assistance of the Mediator. A
hallmark of mediation is its capacity to go beyond traditional settlement
discussions and explore creative outcomes responsive to the participants’ needs
and interests.
5.2 QUALIFICATIONS OF MEDIATORS
A. Who May Qualify
Mediators may be attorneys or non-attorneys, with relevant experience. All

Mediators must successfully complete initial and periodic training as required by
the Court. All Mediators must have a minimum of twenty (20) certified hours of
training in the discipline of ADR. Non-attorneys must also complete a minimum
of four (4) hours of training in federal court civil practice and procedure.
To effectively assist ADR participants and the Court, Mediators must:
• Be knowledgeable about civil litigation in federal court

• Have strong mediation process skills and the temperament to listen
effectively and facilitate communication between all participants and
across “party” lines
• Exhibit strong problem-solving skills and the ability to generate
meaningful options to assist parties and other participants with
settlement negotiations
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5.3 COMPENSATION OF MEDIATORS
A. Mediators shall receive $150/hour for the first two hours of the initial
mediation session. Thereafter, Mediators shall receive no more than their
Court-approved hourly rates for time spent in mediation and preparation.
B. Mediators may require that counsel and/or parties sign an agreement

confirming the terms of retention and compensation.
C. Mediator fees shall be divided equally among all separately represented

parties, unless otherwise agreed or ordered by the Court.
D. A party who has been granted in forma pauperis status is automatically

relieved of his or her pro rata share of the Mediator’s fee. All other parties
shall continue to bear their pro rata portions of the fee.
E. A party who has not sought in forma pauperis status, but is financially
unable to pay all or part of the pro rata share of the Mediator’s fee, may
move for a waiver of the fee requirement on a form provided by the Court.
F. All Mediation Panel members must provide pro bono services. The
minimum service requirement is one pro bono case or two reduced
compensation cases for every four (4) fully-compensated cases for which the
Mediator is selected. Additional pro bono service is encouraged.
5.4 SELECTION OF MEDIATOR
A. Mediator Panel List. The Court shall maintain a list of trained Mediators.
Each Mediator shall provide to the Court information on his or her area(s)
of expertise and compensation rates.
B. Private Mediators. The parties may select a Mediator other than from the
Court’s Mediator list. Such selections are presumed acceptable unless the
C. Selection.
1. Once the parties have stipulated or been referred to mediation, they

shall have thirty (30) days from the date of the Local Rule 16.1
conference or ADR Referral Order in which to select a Mediator,
confirm the Mediator’s availability and file a stipulation regarding
their selection. The Clerk shall send a copy of the ADR Scheduling
and/or Referral Order to the Mediator.
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2. If the parties fail to agree upon a Mediator within the thirty (30) day
period, the Court shall select a Mediator for the case from the Court’s
Mediator list and shall issue an Order notifying the parties of the
Mediator’s identity.
5.5 SCHEDULING AND LOCATION OF MEDIATION
A. Scheduling. Promptly upon being selected, the Mediator shall conduct a

telephone conference, jointly or separately, with counsel and any
unrepresented parties, to fix the date and place of the mediation.
B. Timing. Unless otherwise ordered, a first mediation session shall be

conducted within seventy-five (75) days of the date of the Local Rule 16.1
conference. In pending cases, mediation shall be conducted in accordance
with the ADR Referral Order.
C. Location. The mediation session shall be held in the U.S. Courthouse or the
Mediator’s office, unless otherwise agreed.
5.6 MEDIATION MEMORANDUM
A. Time for Submission. No later than ten (10) days before the scheduled
mediation session, each party shall submit to the Mediator a written
“Mediation Memorandum.”
B. Prohibition Against Filing. Mediation Memoranda shall not be filed and the
assigned Judge shall not have access to them. They shall be subject to the
confidentiality of the mediation process and treated as a document prepared
“for settlement purposes only.”
C. Content of Mediation Memoranda. Mediation Memoranda must not exceed

ten (10) double-spaced pages and shall:
1. Identify by name and title or status:
a. All person(s) with factual knowledge and/or settlement

authority, who, in addition to counsel, will attend the
mediation as a representative(s) of the party; and
b. Any other person(s) (including an insurer representative) whose

presence might substantially improve the effectiveness of the
mediation or the prospects of settlement;
11
2. Concisely describe the parties’ claims and defenses, addressing the

parties’ views of the key liability issues and damages, and discussing
the key evidence;
3. State the relief sought in the case and the basis for monetary
calculations;
4. Describe the current status of the case, including the status of any
motions made;
5. Describe the history and current status of settlement negotiations,

including offers and counteroffers; and
6. Provide any other information that might be pertinent to resolution

of the case, including possible settlement options and alternatives.
Parties should include, along with the Mediation Memorandum, copies of

documents that are likely to make the mediation more productive or
materially advance settlement prospects.
5.7 COMMUNICATIONS WITH THE MEDIATOR
After receiving Mediation Memoranda and submissions pursuant to Section 5.6, the
Mediator may request additional information from any party or participant. The
Mediator, at his or her discretion, may also discuss the case in confidence and ex
parte with counsel, parties and/or representatives. The Mediator shall not disclose
any confidential communication, including the Mediation Memoranda and
submissions, without permission.
5.8 ATTENDANCE AND PARTICIPATION
A. Parties. All named parties and their counsel are required to attend the
mediation session(s) in person unless excused under 5.8(E) below.
1. Corporation or other entity. A party other than a natural person (e.g.

a corporation or some other entity or association) satisfies this
attendance requirement if represented by one or more persons, other
than outside counsel, who have authority to settle and who are
knowledgeable about the facts and circumstances of the case and the
claims being made.
2. Government entity. A unit or agency of government satisfies this

attendance requirement if represented by one or more persons who
have, to the greatest extent feasible, authority to settle, and who are
12
knowledgeable about the facts of the case, the agency’s or unit’s

position, and the procedures and policies under which the agency or
unit decides whether to enter into proposed settlements. If the action
is brought by the government on behalf of one or more individuals,
at least one such individual shall also attend.
B. Counsel. Each party shall be accompanied at the mediation session by the

attorney who will be primarily responsible for handling the trial of the
matter and/or is most familiar with the matter at that stage of the
proceeding. A party who is proceeding pro se may be accompanied by one
non-attorney whom the party relies on for support and/or assistance.
C. Insurers. Insurer representatives are required to attend in person if their

agreement is necessary to achieve a settlement, unless excused under
5.8(E) below.
D. Other Attendees. The Mediator may require the attendance of any other
individual who appears reasonably necessary for the advancement of
communication and resolution between the parties.
E. Request to be Excused. Any person who is required to attend a mediation

session may be excused from attending in person only after showing that
personal attendance would impose an extraordinary or otherwise
unjustifiable hardship. Not less than ten (10) days before the date set for
the mediation, a person seeking to be excused must submit a letter to the
Mediator with copies sent to all other counsel and unrepresented parties,
which states:
1. All considerations that support the request; and
2. Whether the other party or parties join in or object to the request.
Any party opposing the request shall submit a written statement of

opposition no less than five (5) days prior to the mediation.
The Mediator shall promptly make a determination as to the necessity of

the person’s attendance and may require personal participation, permit
participation by telephone, or excuse the person’s presence altogether. The
Mediator’s decision shall be final.
F. Participation by Telephone. A person excused from appearing in person at

a mediation session shall be available by telephone or otherwise be available
as the Mediator may direct.
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G. Good Faith Participation in the Process. All parties and counsel shall
participate in mediation in good faith. Failure to do so shall be sanctionable
by the Court.
5.9 THE MEDIATION SESSION
A. The first mediation session shall be a minimum of two (2) hours. The
parties may, and are encouraged to, extend the length of the session.
B. The mediation session shall be conducted in accordance with the process

described in detail by the Mediator during the opening of the mediation.
The process may include, as appropriate and necessary, the following:
• Mediator “opening statement” and introduction to the process and

session
• An opportunity to present each party’s positions, claims and
concerns
• Joint sessions with all parties participating
• Various “caucus” sessions in which the Mediator meets with one or
more parties and/or their counsel, as the Mediator deems appropriate
C. The Mediator shall have discretion to structure the mediation so as to

maximize the benefits of the process.
D. Any communications to the Mediator during a “caucus” shall not be

disclosed by the Mediator to any other party without permission.
E. The mediation session shall be informal, and conducted with civility.
5.10 CONFIDENTIALITY IN MEDIATION
A. Confidential Treatment. Mediation is confidential and private. No

participant in the mediation process or any portion thereof may
communicate confidential information acquired during mediation without
the consent of the disclosing party. There shall be no stenographic or
electronic recording, e.g., audio or visual, of the mediation process.
1. All written and oral communications made in connection with or

during the mediation session, any positions taken and any views of
the merits of the case formed by any participant, including parties,
counsel and the Mediator, are privileged and confidential.
14
2. There shall be no communication between the assigned Judge or

designated Magistrate Judge and the Mediator regarding a case
referred for mediation.
3. No communication made in connection with or during any mediation

session may be disclosed or used for any purpose including
impeachment in any pending or future proceeding in the Court.
4. The confidentiality of information disclosed during mediation does

not prohibit or limit:
(a) the Court from collecting information relative to evaluation

of the ADR program;
(b) the Mediator from reporting a failure to participate in the

ADR process in good faith, except that the Mediator shall not
disclose the content of confidential communications;
[c] the Mediator from filing “Mediation Certification” forms

pursuant to 5.11;
[d) a party from seeking to enforce a settlement agreement;
[e] a party from disclosing the final resolution and settlement

reached unless, in the interest of justice, the parties have
agreed to the confidentiality of same; or
(f) a participant from making such disclosures as are required

by law.
5.11 CONTINUED MEDIATION AND REPORTS
A. At the close of the initial mediation session, the Mediator and the parties
shall jointly determine whether it would be appropriate and helpful to then
schedule additional mediation. Follow-up could include, without limitation,
written reports, telephonic discussions, negotiations between the parties
with the Mediator available for assistance, or further mediation sessions.
B. Within ten [10] days after the close of each mediation session, and on the
form “Mediation Certification” provided by the Court, the Mediator shall
report to the Court the date the session was held, whether the case settled
in whole or in part and whether any follow up is scheduled. The Mediation
Certification shall be filed.
15
ACKNOWLEDGMENTS
The Court acknowledges and thanks its committee members, who devoted
countless hours to the development of this Plan over two and one-half years, and
the Federal Judicial Center for the ADR consultation, resources and statistics it
provided. In developing this Plan, the Court and its committee reviewed numerous
federal and state court ADR programs nationwide and incorporated a multitude of
recommendations and comments proffered by various members of local and federal
bar associations and their select committees. Additionally, the Court extensively
researched and studied the ethical implications for its program mediators. In doing
so, the Court was particularly impressed with the comprehensiveness and
reasonableness of the various principles enunciated and addressed in the proposed
conflict of interest rules for arbitrators, mediators and other third-party neutrals
currently under consideration for adoption in the State of New York and the CPR-
Georgetown Commission on Ethics and Standards in ADR’s “Proposed Model Rule
of Professional Conduct for the Lawyer as Third Party Neutral.”
In addition, the Court acknowledges the mediators, the litigants, and their counsel,
who have prepared for and fully participated in ADR from the Plan’s inception.
Their thoughtful and open-minded engagement in the process has ensured the
Plan’s success.
16
Case 1:11-cv-00472-WMS Document 1-1 Filed 06/06/11 Page 1 of 3

Lawsuit Vs Brown Smith

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Case 1:11-cv-00472-WMS Document 1 Filed 06/06/11 Page 1 of 22

UNITED STATES DISTRICT COURT

NRP HOLDINGS LLC and NRP PROPERTIES LLC

CITY OF BUFFALO, BYRON W. BROWN,

their attorneys Webster Szanyi LLP, state as follows:

1. This is an action seeking recovery for actual and treble damages

defendant City of Buffalo (“Buffalo”) through a pattern of racketeering activity in violation

2. Plaintiff NRP Holdings LLC is an Ohio limited liability corporation with

its principal place of business in Ohio.

3. Plaintiff NRP Properties LLC is an Ohio limited liability corporation

with its principal place of business in Ohio.

4. Defendant City of Buffalo is a municipal corporation operating under

the laws of the State of New York.

5. Defendant Byron W. Brown (“Brown”) is a resident of the State of

6. Defendant Brown was and is the Mayor of Buffalo.

7. Defendant Demone A. Smith (“Smith”) is a resident of the State of

8. Defendant Smith was and is a member of the Buffalo Common

9. Defendant Richard A. Stenhouse (“Stenhouse”) is a resident of the

State of New York.

10. Defendant Buffalo Jeremiah Partnership for Community

Development, Inc. (“Jeremiah Partnership”) is a domestic corporation operating under the

laws of the State of New York.

11. Defendant Stenhouse was and is the president of the Jeremiah

12. Defendants John Doe 1 – 10 and John Doe Companies 1 – 5

Jurisdiction and Venue

18 U.S.C. § 1964(a), and 42 U.S.C. §1983.

14. This Court has jurisdiction based on diversity of citizenship pursuant

15. Venue is proper in this judicial district pursuant to 28 U.S.C. §1391

and 18 U.S.C. § 1965(a).

17. In November 2007, NRP was invited by representatives of Buffalo to

associated companies are hereafter collectively referred to as the “Development Team.”)

20. Buffalo’s agreement and commitment to the Project was subject to

agreement and commitment is attached hereto at Exhibit “A”.)

compliance period. The lease to own component provides future homeownership

providing them with clean, state-of-the-art housing today.”

was thirty (30) years.

24. By letter dated November 5, 2008, the DHCR notified the

$922,954. (A copy of the DHCR November 5, 2008 agreement and commitment is

attached hereto at Exhibit “C”.)

its February 25, 2008 commitment and agreement.

application to the DHCR.

29. In addition, the City of Buffalo Planning Board “approved as

Stenhouse and/or organizations connected to Stenhouse (including the Jeremiah

Partnership) to participate in the Project.

was required in order to assure adequate minority involvement in the Project.

32. The Development Team was specifically instructed by Brown, Smith,

“make Stenhouse happy” in order for the Project to proceed.

33. Initially, Stenhouse simply indicated an interest to make sure that

there was adequate minority involvement in the Project. Thereafter, Stenhouse

communicated a series of escalating demands. Instead of unofficial input, Stenhouse

Jeremiah Partnership. Eventually, Stenhouse asked whether he could be a partner on

were being held up in defendant Brown’s office.

35. Despite these threats and demands, the Development Team

to assist it in maximizing participation in the Project by local minority business

enterprises, women-owned business enterprises and individuals.

advertisement was placed in the Buffalo News.

and invited to respond.

from Stenhouse and the Jeremiah Partnership.

40. After a thorough review of the proposals, the Development Team

was more reasonably priced.

permit ready letter for the Project.

44. By April 2009, the Development Team had incurred considerable