A top fund-raiser for Mayor de Blasio struck it rich repping the city’s pension funds in a lawsuit against a Brazilian oil giant over a bad investment.
Jay Eisenhofer’s law firm was recently paid $570,332 in legal fees and $189,207 in expenses after obtaining a $3.7 million settlement for the city against the oil company Petrobras. The payments to the firm, Grant & Eisenhofer, came out of the settlement money, according to the city Law Department.
Eisenhofer raised $82,250 for de Blasio during his 2013 mayoral run, campaign finance records show. He also made the maximum donation — $4,950 — to de Blasio’s 2013 campaign and his 2009 campaign for public advocate.
The legal eagle also donated $50,000 to the anti-horse carriage group NYCLASS on May 21, 2013.
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Ten days later NYCLASS cut a check for $50,000 to the political action committee New York City Is Not for Sale, which ran attack ads against de Blasio’s then mayoral opponent, Christine Quinn.
The Daily News reported in 2014 that the FBI investigated those financial transactions and other curious money exchanges involving NYCLASS and the anti-Quinn PAC. Manhattan federal prosecutors subsequently opened a probe into de Blasio, his fund-raising and similar financial transactions.
Earlier this year, acting U.S. Attorney Joon Kim announced that the investigation had ended without any criminal charges. However, he said that de Blasio and his associates solicited donations from people seeking favors from the city and the mayor later contacted agencies on their behalf.
In February 2015 the city’s Law Department, with input from the city controller’s office, picked Grant & Eisenhofer to rep its pension funds against Petrobras.
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Grant & Eisenhofer was one of six law firms competing for the case. All of the firms had been pre-approved since 2012 to represent the city’s five pension funds and Deferred Compensation Plan.
Grant & Eisenhofer’s selection also came three months after Eisenhofer made a $20,000 donation to the Mayor’s Fund to Advance New York City, a nonprofit that de Blasio controls and his wife heads.
Grant & Eisenhofer filed the lawsuit in March 2015, accusing Petrobras executives of knowing about a massive bribing scheme involving construction contracts and high-level politicians in Brazil.
The city’s pension funds and Deferred Compensation Plan purchased securities from Petrobras in 2013 and 2014. When the scandal broke, the city’s funds lost $250 million.
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Grant & Eisenhofer settled the case in March. Under an agreement with the city, the law firm would receive 10 to 16% of the settlement, depending on the amount.
In this case, after expenses, Grant & Eisenhofer netted 16% of the settlement.
“Using outside counsel with expertise in securities litigation was our best bet to recover as much as we could from Petrobras,” Law Department spokesman Nick Paolucci said. He said the relationship between the mayor and Eisenhofer was not a factor in picking the law firm.
Grant & Eisenhofer said in a statement that it has recovered more than $28 billion in the past 15 years working on behalf of institutional investors.
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“It is on the basis of that longstanding record of success by which the firm was chosen by a large number of institutional investors in the U.S. and internationally, including New York City, to represent them in the Petrobras matter,” the firm said.
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