Has the Scott Rothstein case "fizzled"?

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There are a lot of lawyers who are very nervous about what is going to happen next in the Scott Rothstein criminal case. 

First on the list are Stuart Rosenfeldt and Russ Adler, Rothstein's name partners in the RRA law firm that grew and ultimately imploded as a result of the billion-dollar Ponzi scheme at the heart of the case.  Numerous other attorneys implicated by Rothstein -- Doug Bates, Wayne Koppel, Ken Padowitz, Steve Rossi and Christina Kitterman, just to name a handful -- are also surely on the edge of their seats. 

But after nearly three years, some have suspicions that the case is in jeopardy. Those suspicions were only intensified when Rothstein's wife, Kim, was charged last week with conspiracy after trying to get Rothstein to lie in a deposition about missing Ponzi jewelry she'd taken. Kim's request of the imprisoned Rothstein put him in an impossible position -- either to inform the government of his wife's crimes or come clean. If he misled prosecutors in any way on that or any other matter his value as a witness would be even further weakened and the government could indeed decide to scrap otherwise strong cases because of it.

Attorney Bruce Zimet, considered one of the most capable lawyers in South Florida, detailed this line of thought in a sentencing document he recently submitted this week on behalf of former Rothstein lawyer Steven Lippman, who was sentenced to three years in prison yesterday for crimes he committed with Rothstein. From Zimet's filing:

The public implosion of RRA took place nearly three years ago. To date there are numerous individuals who have not yet been charged. It is likely that many culpable individuals have decided not to cooperate or resolve their case based upon their belief that the Government will not be able to proceed with charges so long as Scott Rothstein is the Government's star witness. The recent charges against Rothstein's wife raised new questions concerning Scott Rothstein's conduct and add yet another layer of potential impeachment as well as reinforcement to those who believe that the Government's case has fizzled. Many likely believe that even if the Government indicted its case next week the case would linger well into 2014, if not longer.

The argument was meant to bolster Zimet's contention that Lippman had gone above and beyond the call of duty by cooperating with the feds and pleading guilty instead of fighting the charge, a decision he wrote has devastated his client:

Lippman's decision to step forward, cooperate and resolve his legal issues has increased the public scrutiny and attention directed toward Lippman and his family. The consequential mental anguish that Lippman and his family have endured has been exasperated by Lippman losing his job, Lippman being disbarred, banks closing Lippman accounts for no reason and periodic false claims that Lippman was a player in Rothstein's Ponzi Scheme.

Lippman may not have been a player in the actual Ponzi scheme, but he did invest in one of the bogus deals -- as did Rosenfeldt and Adler, according to Zimet's filing. Lippman invested $50,000 in a sham real estate deal Zimet described as a "package of lies" from Rothstein. Here's what Zimet wrote about that deal in a section of his missive that he titled "The Rothstein Factor."

One can only imagine Rothstein's delight when he realized that Lippman was so starstruck with Rothstein that Lippman excitedly joined an investment that was obviously nothing more than a package of lies. The only documentation to the so called real estate deal is a June 27, 2005 email from Rothstein to Lippman. (Ex "B") Of course Lippman eagerly handed over a check for $50,000 made payable to Rothstein that day. No contract, no paperwork, only Rothstein's word. To Lippman that was more than good enough for him. Predictably, when payment on the investment came due, Rothstein manufactured lies to buy time on the promised payments. Lippman bought Rothstein's lies without question.The Rothstein Factor became even more absurd when Rothstein convinced Lippman to take Lippman's investment in the failed real estate venture and supposedly lend these funds to RRA. Obviously, Rothstein knew that there was no real estate investment and that there were no funds to be transferred to RRA. Rothstein had spent Lippman's real estate investment money and needed to buy time to find new money to replace what he had spent. Unfortunately Lippman held Rothstein on such a high pedestal that Lippman suspended his natural instincts and common sense. Instead Lippman trusted Scott Rothstein. The Rothstein Factor continued until the RRA implosion.

Zimet included the email, in which Rothstein wrote that Rosenfeldt had invested $100,000 and Adler $50,000. That's the first evidence I recall seeing that those two actually invested any money in any of Rothstein's bogus deals.

Lippman of course was highly paid for his supposed devotion to Rothstein -- his pay went up from under $400,000 before he started working with the Ponzi schemer to over $1.3 million when he was at RRA. Zimet however submitted letters from numerous associates indicating that Lippman never quite the "rock and roll lifestyle" Rothstein offered to his acolytes. Instead he's described as a workaholic who didn't drink. A suite attendant at Sun Life Stadium named Teresa Lem wrote that while other Rothstein cronies caroused at games, Lippman was more dignified. 

"I specifically recall Steven bringing his work to the stadium during several football games," Lem wrote. "He would review his work while other guests in the suite partied and drank like crazy. He was definitely different from the rest of the crowd."

Maybe so, but Lippman is the first Rothstein law partner to be sentenced to prison. The question is how many more will go after him.