From Friday's decision in Olivet Univ. v. Newsweek Digital LLC, by Second Circuit Judges Guido Calabresi and Sarah Merriam, and District Judge Jed Rakoff (S.D.N.Y.):
For purposes of our de novo review, we accept the following allegations of the operative Amended Complaint as true. "Olivet is a private religious institution consisting of multiple colleges" with "campuses across the United States," founded by Dr. David Jang in 2004. Olivet had "close ties to" Newsweek from 2013 to 2018; several individuals in leadership at Newsweek's parent company at the time, IBT Media Inc., were affiliated with Olivet.
In 2018, IBT Media was "facing an investigation by the Manhattan District Attorney's Office relating to" financial matters. Olivet was under investigation in 2018 as well, and on October 31, 2018, a grand jury issued a 16-count indictment charging Olivet, its Trustee William Anderson, IBT Media, and others with a scheme to fraudulently "obtain financing from financial institutions, divert the proceeds of the financing and conceal its origins in order to fund … needs unrelated to the stated purpose of the financing, and maintain a credit profile sufficient to continue" the scheme. Anderson, Olivet, and others were also charged with laundering the proceeds of that scheme.
Anderson pled guilty to money laundering in the second degree and to participating in a scheme to defraud in the first degree. On February 11, 2020, Olivet … pled guilty to (a) Count 4 of the indictment, charging it with felony falsification of business records in the first degree; and (b) a lesser included charge of Count 3 of the indictment, specifically, conspiracy in the fifth degree, a misdemeanor. Count 3 of the indictment charged Olivet and others with conspiring to commit "Money Laundering in the Second Degree," a class C felony. Under the terms of Olivet's plea agreement, the felony falsification of business records charge was eventually reduced to a misdemeanor, and all remaining counts of the indictment, except for the conspiracy charge, were dismissed.
