Nigeria floors U.S.-based lawyer, Emeka Ugwuonye, who stole $1.55Million embassy funds

Last Friday, Nigeria achieved a significant milestone in its war against corruption and looting of public funds.

But the war and the victory were on foreign soil in faraway Washington DC, where United States District Court Judge Barbara Jacobs Rothstein announced a default judgement against Emeka Ugwuonye in a case that has lasted over five years.

The judge found Mr. Ugwuonye liable on all claims made by the Embassy of Nigeria in Washington DC, and awarded the Embassy monetary damages in excess of $2 million.

Mr. Ugwuonye’s troubles in the United States with the Embassy, his former client, concern diversion of $1.55 million proceeds of tax refunds in a real estate transaction in Washington DC he undertook for the Embassy.

Mr. Ugwuonye, who practiced law in the State of Maryland, has proved to be a bad lawyer, but perhaps an even worse gambler or mathematician who chose the risk of a $1.55 million check in exchange for monetary damages that could rise to $6.2million.  He also stands to lose his professional licence and even personal liberty.

In the five years in which Mr. Ugwuonye has been defendant rather than counsel in a State of Maryland courtroom, he has suffered loss after loss, including even the very companies he used in the real estate transaction on behalf of the embassy, for failure to pay property taxes.

He has forfeited, at least twice, ECU Associates PC, the firm he used in some of the real estate transactions.  Originally incorporated in July 1999, the firm was forfeited in October 2006, following which Mr. Ugwuonye incorporated ECU Law PC with the State of Maryland between January and March 2007.

Between April and June 2007, Mr. Ugwuonye somehow revived ECU Associates PC to receive money from the Nigerian Embassy for shady real estate deals, but he would eventually forfeit the company to the State of Maryland, like ECU Law PC.

In October 2009, Mr. Ugwonye sued various Nigerian citizens and reporters who questioned his sale of the properties and handling of the tax refunds.  He lost all those cases.

He has also remained suspended from practicing law in Washington DC and New York jurisdictions after the state of Maryland suspended him for mishandling cases involving some of his clients.

Filing a motion for default judgement on May 23, the Embassy asked the judge to compel Mr. Ugwuonye and his firm to pay $6.2 million in restitution and additional costs, as follows:

·      $1.55 million in base compensatory damages;

·      Prejudgment interest on the tax refund in the amount of 6% per annum commencing on November 20, 2007;

·      Punitive damages in an amount equal to two   times the total compensatory damages, inclusive of prejudgment interest;

·      Post-judgment interest in accordance with 28U.S.C. § 1961; and

·      Such other relief as the court may deem just and proper.

Evidence presented to demonstrate the scope and severity of Mr. Ugwuonye’s fraud in the matter and his contempt of the Court’s procedures and orders included documents showing that he recovered the tax refund on the Embassy’s behalf, lied to the Embassy concerning the whereabouts of the funds, and proceeded to use the funds for his personal benefit.

But as had been the pattern, Mr. Ugwuonye was absent at the hearing, having filed a 3:00 a.m. motion requesting an indefinite continuance of the case.

“He did this clearly fearing vigorous questioning and simply failed to appear, in the process further exasperating the court,” said a lawyer for the Embassy who noted that Mr. Ugwuonye’s absence was particularly glaring in light of the court’s scheduling order which cautioned him not only to be present, but also prepared to respond to [the] Plaintiff’s allegations.”

The lawyer recalled Mr. Ugwuonye’s flouting of discovery deadlines; court deadlines to file motions and oppositions to motions; failure to produce documents and information in discovery; violating a court order compelling discovery, and failing to appear at his duly noticed deposition, all of them held as evidence of obvious disrespect for the U.S. justice system.

In her judgement, Judge Rothstein announced her intention to award the Embassy $1.55 million in compensatory damages, pre-judgment interest at a rate of 6% per annum, post-judgment interest, and certain categories of attorneys’ fees and costs, bringing compensatory damages and pre-judgment interest alone, as of that day—July 12, 2013—to $2,075,131.30.

The judge will issue a written order over the next few weeks summarizing her findings and specifying the full scope of damages she is awarding.  She has already indicated that she will seriously consider the Embassy’s request for punitive damages.

A lawyer familiar with the case said, “An award of punitive damages in the context of default judgment is highly unusual in the U.S. legal system when the parties have not directly litigated the merits of the case.

“Nonetheless, Judge Rothstein agreed to consider a punitive damages award due to the extraordinary nature of the matter.  Specifically, she expressed concern that the Embassy’s views of the U.S. legal profession had been tarnished by Mr. Ugwuonye’s outrageous misconduct.”

Beyond all that, it is noteworthy that Judge Rothstein urged the parties to pursue the bar complaint the Embassy has filed against Mr. Ugwuonye in the State of Maryland, another highly unusual step on the part of the judge, but reflecting the severity of Mr. Ugwuonye’s professional fall.

The irony however, is that while Mr. Ugwuonye is being made to pay back what he stole from Nigeria in far away America, he has tactically relocated to Nigeria where he is rebranding himself as an “anti-corruption crusader”.

In Nigeria where Mr. Ugwuonye is facing several other criminal charges, he continues to thumb his nose at the justice system, with perhaps a solid understanding that the justice system is weak and slow.

In the Senate, the committee investigating how the Embassy of Nigeria came to sell off many properties in the Maryland area in the first place and the propriety of the sale of those real estate holdings has treated Mr. Ugwuonye like a star, even allowing him get away with a petition in which he sought to turn his accusers and victims into criminals.