BULLETIN: Judge Declines To Recuse Herself — And Denies Motion By ASD Figures Todd Disner And Dwight Owen Schweitzer To Reopen Lawsuit

BULLETIN: AdSurfDaily figures Todd Disner and Dwight Owen Schweitzer will not be permitted to reopen their lawsuit against the government and get a different judge to hear it.

U.S. District Judge Rosemary Collyer of the District of Columbia this morning denied a motion by the ASD duo that she recuse herself from the case. At the same time, Collyer denied a motion by Disner and Schweitzer to reopen the case.

“A judge’s sworn duty is to judge with fairness and impartiality, and absent a showing otherwise, a judge is presumed to be impartial,” Collyer ruled.

Disner and Schweitzer made no such showing, Collyer ruled.

“Plaintiffs have presented no reasonable argument why this matter should be transferred to another judge,” Collyer ruled. “Further, Plaintiffs do not present sufficient facts that would lead an objective observer to believe that the Court has rendered a biased decision in this matter.”

With respect to the Disner/Schweitzer motion to reopen the case, Collyer said this (italics added):

Plaintiffs were victims of an internet Ponzi scheme called AdSurfDaily, Inc. (ASD). Federal agents investigated ASD for wire fraud and money laundering and, pursuant to warrants, federal agents seized approximately $80 million of ASD’s funds and related assets. The Government obtained in rem forfeiture judgments against the funds and other property purchased with ASD monies. Plaintiffs brought this suit, alleging that the warrants and the seizure of the funds were invalid and seeking a declaratory judgment that their Fourth Amendment rights were violated.

Because Plaintiffs lacked standing to raise a Fourth Amendment claim and because they had no privacy interest in financial records they voluntarily conveyed to ASD, the Court dismissed the Complaint on August 29, 2012 . . .

A motion for reconsideration need not be granted unless the court finds there is an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice . . .

A motion to reconsider is not “simply an opportunity to reargue facts and theories upon which a court has already ruled” . . . Nor is it an avenue for a “losing party . . . to raise new issues that could have been raised previously” . . .

Plaintiffs’ motion falls woefully short of this demanding standard. Plaintiffs do not allege an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice. They merely reargue the same points they previously raised . . .

On Sept. 17, Disner and Schweitzer accused Collyer of “sophistry” in her handling of their lawsuit. The ASD duo insisted that ASD was a legitimate enterprise even after ASD President Andy Bowdoin pleaded guilty to wire fraud in May and admitted ASD was a Ponzi scheme.

In separate court actions brought by the government on ASD-related matters, Collyer has ordered the forfeiture of more than $80 million. That money was set aside to compensate victims of Bowdoin’s crime.

About 9,000 ASD victims already have received a total of about $59 million in compensation, and the government says it plans to reopen claims to victims who missed the January 2011 filing deadline because the ASD database very likely did not include the names of all members.

In their motion to reopen the case, Disner and Schweitzer curiously argued that Collyer — despite Bowdoin’s guilty plea, acknowledgment that ASD was a Ponzi scheme and prison sentence of 78 months — should have assigned more weight to the opinions of purported multilevel-marketing experts that ASD was not a Ponzi scheme.

They further ventured that Bowdoin’s confession was “coerced,” even though Bowdoin himself said it was not.

After their ASD days, both Disner and Schweitzer became pitchmen for Zeek Rewards, which the SEC described in August as a $600 million Ponzi- and pyramid scheme.

ASD was a Ponzi scheme that gathered at least $119 million, federal prosecutors said.