A group of women who won a $3.85 million sex-trafficking case against former Salomon Brothers trader Howard Rubin continue to face significant delays in receiving their awarded damages, as a complex legal fight unfolds between their attorney and a litigation funder. The women are seeking details of the financing arrangements that their Manhattan lawyer, John Balestriere, had with Pravati Capital, in order to support a fees motion connected to the Rubin case.
Despite a 2022 jury decision finding Rubin liable for sex trafficking and battery, Rubin’s subsequent appeal has prolonged the process, leaving the plaintiffs without their designated compensation. The case is further complicated by an ongoing court battle between Balestriere and Pravati, with the latter claiming that it is owed more than $15 million for investments across several of Balestriere’s cases, including $300,000 for the Rubin lawsuit.
In March, an Arizona arbitrator ruled that Balestriere must pay Pravati over $15 million, marking a significant escalation in the dispute. As the litigants navigate federal and state courts, the unresolved issue of who should bear the litigation costs adds to the uncertainty. Balestriere is advocating for Rubin to be held responsible for these costs, while Pravati accuses him of trying to pass the financial burden onto Rubin’s accusers.
The tangle of legal and financial entanglements highlights broader concerns within the $15.2 billion litigation funding industry. Relationships between funders, attorneys, and clients are increasingly strained, as illustrated by the scrutiny of Pravati’s business practices. A 2021 Bloomberg Law investigation revealed that Pravati had engaged in multiple arbitrations against clients, often resulting in substantial judgments that required the repayment of loans at strikingly high-interest rates.
Balestriere has faced critiques beyond this current dispute. He was previously accused by Caitlin Sanchez, a former voice actor for “Dora the Explorer,” of forcing her into a disadvantageous legal settlement, according to court documents. Additionally, he was admonished for pursuing unfounded trademark infringement claims in a suit involving a Spotify subsidiary in 2021, as documented in legal filings.
With an Arizona federal court hearing scheduled for next week to address Balestriere’s request for documents from Pravati, the plaintiffs’ wait for justice continues amid a landscape fraught with legal and financial complexity. For full details, visit Bloomberg Law’s coverage here.