The billionaire and the bait shop

By Joel Thurtell

Don’t mess with a bait shop.

That’s the lesson Matty Moroun, the billionaire trucking magnate and Ambassador Bridge owner, might take from the ruling Thursday, June 29, 2010, by U.S. District Judge Robert Cleland if he shuts his door and doesn’t listen to his lawyers.

Judge Cleland said Matty’s claim that his bridge company is a “federal instrumentality” exempt from state and local regulation is baloney.

The Michigan Supreme Court had swallowed Matty’s bait and declared him equivalent to a government agency, even though a Michigan appellate court said Matty was blowing smoke.

Maybe it made a difference to move the question out of a state judiciary rife with campaign contributions and into the federal system, where judges are appointed for life.

Maybe Matty’s lawyers were dumb.

Or maybe the bait shop finally found a smart judge.

Whatever the reason, the myth of Matty’s “federal instrumentality” has been shattered.

“Federal instrumentality” is a fancy way of saying that if Matty had that status, he’d be exempt from local and state laws and ordinances and could condemn and seize private and even government property.

He would be entitled to arm security guards with shotguns and send them forth to drive unwitting park-goers out of city parks, because he could claim to be the park’s owner as a “federal instrumentality” with the power to seize other people’s property and, yes, even take government property such as the city of Detroit’s public Riverside Park next door to his Ambassador Bridge.

He could seize a city street and place gas pumps and a duty-free store on city property, which by the way would leave a privately-owned bait shop cut off  from aceess by its customers.

Not only could Matty behave in this arrogant, bully-boy manner, but he actually has done so: with permission of the Michigan Supreme Court.

The justices in Lansing put the state’s stamp of approval on Matty’s theft of private and city property.

Judge Cleland struck the false claim down and ordered an injunction that trashes Matty’s claim.

In his opinion, Judge Cleland referred to Matty, aka DIBC, as “a nuisance.”

I suppose the word “pestilence” is not within the range of judicial expression.

But the judge’s ruling is instrumental to our understanding of how to proceed should the city of Detroit ever donate or sell Riverside Park to Matty.

Simply do what Matty does: Sue every government connected to Matty and Riverside.

The city.

The state.

The federal government.

Simply claim the governments are liable for Matty’s bad behavior.

In fact, I doubt that would ever be necessary. The basis for Judge Cleland’s ruling is the federal government’s effort — successful — to make sure it isn’t tainted by Matty’s illegal acts.

The lawsuit upon which the judge ruled involved claims by both the owner of the Lafayette Bait Shop, which was made landlocked and inaccessible to its customers by action of Matty, and also the federal government. Matty’s claim of governmental status, and his theft of land both at 23rd Street and at Riverside Park left the feds open to being sued as complicit in Matty’s unlawful actions. The city faced the same problem. And in the case of Riverside Park, the state of Michigan might also be considered liable for having invested taxpayer money into the development of the park’s boat launch, which had for years been shut down with Matty’s padlocks.

[I understand that Riverside Park is on a list of literally dozens — some say 77 — city parks that are slated to be closed due to the city’s budget crunch. I also hear that the city Recreation Department still plans to invest a sizable chunk of money into restoring the Riverside Park boat launch. Frankly, I don’t know what is what, and for that reason have refrained on reporting about it. Let’s wait and see. But Judge Cleland’s ruling is pretty clear and worth a close read.]

[I know that there are lots of people in and around Detroit who want Riverside Park to stay open; there are plenty of boaters who would love to put their boats in at the park. I can’t believe either Mayor Bing or the City Council would risk the ire of citizens by ceding the park to Matty. However, I sure would like to know more about dealings regarding the park in the past few years.]

I don’t know Judge Cleland, but I suspect the man is not only a first-rate legal scholar, but quite a wit. He wrote a wonderfully frank and well-researched opinion in the Ashenfelter-Convertino case.

The judge certainly didn’t mince words when he described the abilities of Matty’s legal crew. Matty’s case was so ineptly written that the judge had trouble discerning its argument. Evidently, he decided that there was no real line of reasoning, just a rehashing of facts that Matty put forth in his first “federal instrumentality” case before the Wayne County Circuit Court. Yet for some reason, evidence from that case was not presented to Cleland in federal court.

Might be worth firing some lawyers, Matty!

One of the main arguments against Matty’s claim that his bridge company is a government agency was made by, guess who! Matty’s own lawyers. It came in the form of a list of answers provided by federal government attorneys to a set of criteria that are considered legal qualifications determining whether an organization is a “federal instrumentality.”

From Judge Cleland’s ruling:

Court jurisprudence accepts as relevant in holding an entity to be a federal

instrumentality:

(1) it performs governmental functions;

(2) government officials thoroughly control its operations;

(3) it would be deemed a servant under the law of agency;

(4) its officers are appointed by the President or other high government

official;

(5) it is not organized for profit or to perform commercial

activities;

(6) it is created by federal statute;

(7) the government owns it or it is supported by the government, which

carries its profits and losses; and

(8) it is considered by Congress and the President to be an arm of the

federal government.

The responses to these criteria, as regards the Ambassador Bridge, demonstrate just how far up a phony, paper tree Matty and his legion of lawyers have been barking.

It is truly amazing that Matty’s own lawyers submitted a set of government admissions in response to the criteria for federal instrumentality. I say amazing, because these answers — submitted by Matty — utterly shatter the trucking titan’s contention that his bridge is somehow an appendage of federal government:

(1) [T]he federal government did not create or authorize the creation of [DIBC]

(the corporate entity, not the Ambassador Bridge itself) or its corporate

predecessor.

(2) [T]he federal government does not have any control of DIBC’s articles of

Case 2:09-cv-11060-RHC-RSW   Document 99    Filed 06/29/10   Page 34 of 37

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incorporation, by-laws, or other corporate documents.

(3) [T]he federal government does not own all or any part of DIBC.

(4) [T]he federal government does not handle and control the operations of

DIBC.

(5) [T]he federal government does not appoint any of DIBC’s officers.

(6) [T]he federal government does not have any control of the hiring, firing or

supervision of any of DIBC’s employees or officers.

(7) [T]he federal government does not fund DIBC’s operations.

(8) [T]he federal government does not have any control over DIBC’s

spending.

(9) [T]he federal government does not receive any share of profits generated

by DIBC’s operations.

(10) [T]he federal government does not bear any portion of losses resulting

from DIBC’s operations.

(11) [T]he federal government is not liable for any judgments entered against

DIBC.

(12) [T]he federal government does not have any control over DIBC’s policies

or positions.

(13) [T]he federal government does not have any control over lawsuits filed by

DIBC or actions or positions taken by DIBC in litigation.

(14) DIBC is not indispensable to the workings of any federal department or

unit.

(15) [T]he federal government does not have the power to dissolve DIBC.

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(16) DIBC does not perform any governmental function.

(17) [N]o federal statute, regulation or guideline designates DIBC as a federal

instrumentality or indicate that the federal government believes DIBC to be

a federal instrumentality.

(18) [N]o federal contract requires that DIBC seize, destroy and build upon 23rd

Street in Detroit, Michigan, immediately north of Fort Street.

(19) [N]o federal law requires that DIBC seize, destroy and build upon 23rd

Street in Detroit, Michigan, immediately north of Fort Street.

(20) [N]o federal policy or objective requires that DIBC seize, destroy and build

upon 23rd Street in Detroit, Michigan, immediately north of Fort Street.

No way is the Ambassador Bridge a government entity.

Remember those phony “Homeland Security” warning signs Matty posted on the fence he put around part of Riverside Park after he illegally seized the land? Judge Cleland’s ruling destroys any shred of credibility Matty might have had for claiming a right to post those fake signs as part of his “federal instrumentality” claim.

I got involved in this story after one of Matty’s henchmen, a shotgun-totin’ goon, ejected me from the park as part of his boss’s fraudulent “Homeland Security” claim.

We didn’t need Judge Cleland to tell us that was a sham.

But the judge has done a wonderful job underlining the scope of Matty’s deceit. What a creaky, rickety, and ultimately stupid case Matty has been making.

But guess what: The chain-link fence still surrounds the section of Riverside Park Matty grabbed. The gas pumps and duty-free store still squat on 23rd Street, a public piece of property ripped off by Matty.

I imagine Matty’s army of lawyers is now headed for the Sixth Circuit Court of Appeals to challenge Judge Cleland’s ruling and order.

How much longer will Matty’s false claims be allowed to rule?

Drop me a line at joelthurtell@gmail.com