Chief U.S. District Judge, Robert Jones, has reassigned the Steve Davidovici case to another judge … himself … after questions about the potential ties between the case’s former judge, Judge Kent J. Dawson, and the former Las Vegas nightclub owner, Davidovici, just wouldn’t go away.
After a four-year investigation by the Internal Revenue Service (IRS), who had received information that Pure employees were not paying income tax on or reporting their total tip income, the IRS uncovered a $7 million tip scam which included Pure executives, VIP hosts, and doormen. Every night, VIP hosts and doormen would pool their tips, and at the end of the week everyone, including Davidovici and club executives, would get a share of the tips. For 2006 and 2006, Davidovici failed to report over $400 thousand in tip income. In 2006 he filed a false federal income tax return. Wanting to avoid a trial, Davidovici pled guilty.
Federal prosecutors sought an 18-month prison sentence for Davidovici because Davidovici lied and actively concealed facts from IRS auditors, helped subordinates to do the same, misled licensing authorities, and made deceptive submissions to the court. Additionally, Davidovici intimidated tip scam whistleblowers by threatening to make it impossible for them to work on the Las Vegas Strip again, then stealing data from their personnel files to pull off this vendetta.
However, after Davidovici pled guilty, Judge Dawson imposed a sentence of three years’ probation and eight months of home confinement so Davidovici could get the care he needed for his eye condition, acute optic neuropathy, which threatens to leave him legally blind. Shortly after sentencing, the FBI began investigating a possible relationship between Judge Dawson and Davidovici when a “Face to Face With Jon Ralston” producer discovered that Judge Dawson’s son worked at clubs connected to Davidovici. Specifically, the FBI wanted two questions answered:
1. The depth of the relationship, if any, between Davidovici and Judge Dawson’s son Brian?, and 2. Did this relationship influence Judge Dawson’s sentencing of Davidovici, which many have called “lenient” and prosecutors expressed strong objections.
FBI agents in the Las Vegas public corruption squad questioned Davidovici’s current and former employees. Brian Dawson worked as a bartender Gallery Nightclub at Planet Hollywood, where Davidovici was a consultant. Brian Dawson also had a work card as a bartender at Chateau Nightclub & Gardens at Paris Las Vegas, which Davidovici co-owned. Judge Dawson insisted he was not aware of his son’s employment ties until informed by the media.
The reassignment of the Davidovici case followed a closed court hearing before U.S. Magistrate Judge Peggy Leen. Though Leen sealed this hearing record, during a June hearing Judge Dawson held on the matter, the court record states, ”A question of judicial conflict has been raised regarding the employment of a member of the judge’s family. This emergency hearing was called to address those concerns. The court has reviewed the matter and has found no grounds for recusal. The judge’s family member is not a minor, not a member of the judge’s household and until this morning, the court was unaware of his specific place of employment.”
Under 28 USC Section 455, a judge may be removed from a case where he has or potentially has a bias or prejudice concerning a party to the case.
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