YOUNGSTOWN Facing suit, Flask files for bankruptcy

The attorney general's office plans to contest the validity of the former MVSD director's bankruptcy filing.
By DAVID SKOLNICK
VINDICATOR POLITICS WRITER
YOUNGSTOWN -- Attorneys for Edward A. Flask say they advised the Ohio Attorney General's Office that if it insisted on pursuing a $2.4 million civil lawsuit against their client, he would have no choice but to file for bankruptcy.
The attorney general didn't back down and neither did Flask.
The former Mahoning Valley Sanitary District director filed for protection from his creditors under Chapter 7 of the federal bankruptcy code -- citing the pending $2.4 million lawsuit and unpaid legal and court fees from his criminal trial as the main drains on his finances.
The filing causes the civil lawsuit, which was to begin today, to be postponed until his bankruptcy matters are resolved.
Response: Assistant Attorney General Arthur J. Marziale Jr., who was handling Flask's case, said his office plans to contest the validity of the bankruptcy filing.
"We think it is regrettable that Mr. Flask wasted everyone's time and effort on this," Marziale said. "This matter is not properly in bankruptcy court. We will contest that issue and we will be back here to try this case. We are looking to get the bankruptcy dismissed."
But John Corrigan, one of Flask's attorneys, said the bankruptcy filing should have come as no shock because it has been discussed with the attorney general's office for months. Simply put, Flask does not have the money to pay any amount in the civil case, and Flask shouldn't even be responsible for paying any money because he is not accused of improperly taking public funds, Corrigan said.
The attorney general's office and visiting Judge Richard M. Markus, who is overseeing the civil suit, did not learn about Flask's bankruptcy filing until around 9 p.m. Sunday. Flask, of Poland, filed the bankruptcy petition at 4:01 p.m. Friday at the federal courthouse in Youngstown.
Judge Markus said his hands are tied and he has no choice but to postpone the civil suit because of Flask's bankruptcy filing.
The case so far: The attorney general's office filed three separate $2.4 million lawsuits against Flask, Frank D. DeJute of Niles, another former MVSD board director, and Gilbane Building Co. of Rhode Island, which served as construction manager on the water agency's $50 million capital improvement program.
The lawsuits contend Flask and DeJute improperly paid Gilbane for construction work it never performed at the MVSD. The lawsuits also accuse Flask and DeJute of improperly receiving health, life insurance and pension benefits from the district.
A federal judge dismissed the Gilbane case last week, saying the construction company did not receive any illegal fees from the MVSD. The attorney general's office plans to appeal the decision.
Judge Markus said he read the federal judge's decision and although he does not have other court documents related to the case, he said he had some significant doubt that he would agree with the decision.
DeJute's case is set for Nov. 26 in Trumbull County Common Pleas Court. But Marziale said DeJute, who is defending himself and plans to seek a dismissal on this matter, wants the case to begin sooner.
Fair-trial issues: Even though Judge Markus could not move ahead with the civil suit, he spent nearly an hour considering whether Flask could receive a fair trial in Mahoning County.
Judge Markus said he has heard from someone that errors have been made in media reports on Flask and that could taint a jury pool. Judge Markus could not cite specific articles or television news reports about Flask that included these errors and admitted he has not watched any TV coverage of Flask and has read very few newspaper articles on the matter.
The judge also said factually correct media reports about Flask could affect the case using the World War II quote, "Loose lips sink ships," as a warning about what could happen.
"I hope to encourage the media to be cautious in how they express themselves," Judge Markus said. "We should be careful what we say because it could have an impact on the case."
The judge then brought in the nearly 50 potential jurors in the Flask case to tell them about the postponement. He told them he had concerns about Flask getting a fair trial in Mahoning County, even though he said he believed a fair trial could be held here.
The judge polled the potential jurors asking if they had heard of Flask. About half raised their hands and nine said they had formulated opinions about Flask. When questioned by the judge, two women said they had read about Flask and believed he had abused his power and took kickbacks.
Flask served 90 days in Trumbull County Jail last year after Judge Markus found him guilty of nine charges related to improperly accepting $2 million in cash and gifts from vendors who did business with the MVSD.
The MVSD provides water from Meander Reservoir to about 300,000 customers in Mahoning and Trumbull counties through its member cities of Youngstown and Niles.
skolnick@vindy.com