SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF RICHMOND

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In the Matter of the Application of JAMES :
THOMSON, MEGHAN THOMSON, JAMES :
REYES SALAZAR, BRANDON LINKER, and : Index No. 080319/09
JAMES HART, :
: Special Election Part
Petitioners, :
: Justice Giacobbe
- against - :
:
DATA AND FIELD SERVICES, INC., DAVID :
THOMAS, as the Treasurer of Debi Rose 4 City STIPULATION OF
:
Council, BOARD OF ELECTIONS IN THE CITY : SETTLEMENT AND ORDER
OF NEW YORK, and NEW YORK STATE :
BOARD OF ELECTIONS, :
:
Respondents. :
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WHEREAS, Petitioners James Thomson, Meghan Thomson, James Reyes Salazar, Brandon

Linker and James Hart (collectively, “Petitioners”) filed a petition, alleging that Respondent Data

and Field Services, Inc. (“DFS”) made undisclosed in-kind contributions to Debi Rose 4 City

Council, Rose’s campaign committee for the 2009 primary and general elections (the “Rose

Campaign”), by either failing to charge or undercharging the Rose Campaign in multiple respects, in

violation of Article 14 of the New York State Election Law (the “State Election Law”), and then

made a motion in limine documenting specific amounts of alleged undercharging as follows:

a. $5,600.00 in costs for the services of DFS employees Vonda McKeithan, Bryan

Collinsworth, and Rachel Goodman;

b. $1,000.00 in get-out-the-vote (“GOTV”) expenses;

c. $800.00 in tolls for transporting its canvass workers to Staten Island to canvass for

the Rose Campaign;

d. $1,125.00 for access to the Voter Activation Network (the “VAN”); and
 e. $5,000.00 for failing to collect, prior to commencing work for the Rose Campaign,

that amount still owed to it for its services to Friends of Debi Rose, Rose’s campaign

committee for the February 2009 special election; and

WHEREAS, DFS and David Thomas, as the Treasurer of Debi Rose 4 City Council (the

“Rose Campaign”) (together, “Respondents”), answered the petition and opposed the motion in

limine, denying the allegations; and

WHEREAS, Petitioners and Respondents wish to resolve this action on a consensual basis,

thereby obviating the need for any finding whether Respondents violated the State Election Law;

and

WHEREAS, Respondent New York State Board of Elections (the “State Board”) has

previously informed the Court that it “takes ‘no position’ on the merits” of this special proceeding

and is therefore not a signatory to this stipulation and order;

IT IS HEREBY STIPULATED AND AGREED, by and between the attorneys for the

respective parties hereto, as follows:

1. DFS shall immediately issue a supplemental invoice in the sum of $8,525.00 to Debi Rose 4

City Council; and DFS shall immediately reissue an invoice in the sum of $5,000.00 to

Friends of Debi Rose as the amount still owed to DFS for its services to Rose’s campaign

during the February 2009 special election. Debi Rose 4 City Council shall promptly amend

its public financial disclosure reports filed with the State Board and the New York City

Campaign Finance Board to reflect this liability and its obligation to pay the aforesaid sum of

$8,525.00. And Friends of Debi Rose, immediately upon receipt of the reissued invoice,

shall pay the aforesaid sum of $5,000.00.

2. Debi Rose 4 City Council shall also review in good faith all of the other allegations raised in

this special proceeding and make any other disclosures required by law when it re-files,

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 consistent with its obligations under, and subject to the provisions of, Article 14 of the State

Election Law. The amendments to its public financial disclosure reports shall occur in any

event within 30 days of the date of entry of this stipulation and order.

3. In addition, as soon as practicable but, in any event, by no later than 90 days from the date

of entry of this stipulation and order, Debi Rose 4 City Council shall pay the aforesaid sum

of $8,525.00 set forth in paragraph 1 above.

4. DFS shall promptly implement reforms in its corporate structure and corporate governance

to ensure that it adheres to proper corporate formalities and operates independently and not

under the control of the Working Families Party, the Working Families Organization, and

affiliated entities or organizations (collectively, the “WFP”), including the following:

a. DFS shall effectuate the appointment of sufficient independent directors to

constitute a majority of its Board of Directors. They shall have a mandate to

implement procedures, best practices and by-laws intended to ensure that DFS is

operated in a manner that complies with all applicable state and local campaign

finance laws, and is operated independently and not under the control of the WFP.

Proposed independent directors shall not be deemed “independent” unless, for a

period of at least two years prior to appointment, they have not themselves been:

(i) employed by, a member of, or a contributor to the WFP; or (ii) employed by, a

member of, or a contributor to any contributor to the WFP; provided, however, that

the foregoing shall not automatically bar an individual from serving as an

independent board member simply because that individual is a contributor to an

elected officeholder candidate who has made a contribution to the WFP;

b. DFS shall establish management, administrative, and employment structures that are

independent of and not controlled by the WFP. In this regard, DFS should cause its

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 payroll system, finance record keeping, IT department, and its full-time

administrative staff to be reviewed to assure that they are independent of and not

controlled by the WFP;

c. DFS shall engage at its expense going forward a certified public accounting firm,

different from any such firm that has provided or is providing such services to the

WFP, to audit its books and records, and then issue audited financials each year;

d. DFS shall engage at its expense going forward a law firm, different from any such

firm that has provided or is providing such services to the WFP, to ensure DFS’s

compliance with all applicable state and local campaign finance laws;

e. DFS shall change its standard contract with candidate-clients or their committees to

provide express terms identifying: (i) the DFS employee(s), or in the case of

canvassers, the type of employee, who will perform services under the contract;

(ii) the services such employee(s) will perform; (iii) the estimated total hours, or in

the case of canvassers, total shifts, expected to be worked by the employee(s); and

(iv) the amount that DFS will charge for each such employee’s services. The charges

shall be based on either a specified hourly rate or shift charge or flat rate, as the case

may be, for the services to be provided by each such employee or type of employee

under the contract. For canvassing contracts, that contract shall set forth the

number of canvassing shifts that DFS agrees to provide. DFS shall charge its

candidate-clients (or their committees) fair market value for the actual services

provided by DFS as a for-profit corporation;

f. DFS shall review in good faith its practices and procedures to date, in light of the

allegations made in this special proceeding, to determine the extent to which it may

have undercharged the campaigns for which it provided services, and thereby

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 effectively given those campaigns in-kind contributions, and to change its fee

structure going forward as warranted based on that review to ensure that DFS

charges all future campaigns for the fair market value of the actual services DFS

provides;

g. DFS shall not provide access to the VAN to its candidate-clients or their committees

unless it shall first have caused an independent expert to conduct an evaluation of

the actual fair market value of the VAN to its candidate-clients (or their committees)

for whom or which DFS provides services. DFS shall provide Petitioners, through

their attorneys, with prior notice of any candidate it proposes to serve as the

independent expert conducting that evaluation, and if Petitioners object, the

proposed candidate shall then have to be approved by the Court in order to serve.

DFS shall charge its candidate-clients and their committees the amount determined

by the independent expert to be the actual fair market value of the VAN.

5. DFS reserves the right to apply to this Court, on notice to Petitioners, through their

attorneys, for an order modifying any provision set forth in paragraph 4 above, for good

cause shown, based upon changed circumstances.

6. In exchange for the foregoing, Petitioners agree to discontinue this special proceeding.

7. Nothing contained herein shall be deemed to be a finding of fact or conclusion of law, or an

admission by either Respondent that there has been a violation of the State Election Law or

the New York City Campaign Finance Law.

8. The parties have entered into a confidentiality agreement, pursuant to which DFS has

produced certain documents. This agreement, a copy of which is appended hereto as

Exhibit A, is incorporated by reference into this stipulation and order, but shall survive.

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9. This Court shall retain jurisdiction over this special proceeding to oversee, implement and

enforce the terms of this stipulation and order, and to render any further decisions required

hereunder.

10. For purposes of this stipulation and order, the parties, through their counsel, shall be

permitted to sign in counterpart, which shall be deemed good and effective execution of this

agreement, and faxed or scanned signatures shall be deemed to be originals. This stipulation

and order shall be binding on the parties so long as executed by at least one counsel of

record for each party hereto (Petitioners, the Rose Campaign and DFS).

Dated: New York, New York

February 22, 2010

GIBSON, DUNN & CRUTCHER LLP LEVY RATNER P.C.

By: By:
Randy M. Mastro Alexander Rabb
Kevin Blake
Timothy D. Swain 80 Eighth Avenue, Floor 8
Eric Yuen New York, New York 10011
Telephone: (212) 627-8100
200 Park Avenue, 47th Floor Facsimile: (212) 627-8182
New York, New York 10166-0193 arabb@levyratner.com
Telephone: (212) 351-4000
Facsimile: (212) 351-4035 – and –
rmastro@gibsondunn.com
KANTOR, DAVIDOFF, WOLFE,
– and – MANDELKER, TWOMEY &
GALLANTY, P.C.
RALPH J. PORZIO, ESQ.

By:
By: Lawrence A. Mandelker
Ralph J. Porzio
51 East 42nd Street, 17th Floor
686 Forest Avenue New York, New York 10017
Staten Island, New York 10310 Telephone: (212) 682-8383
Telephone: (718) 448-4000 Facsimile: (212) 949-5206
Facsimile: (718) 876-9302 mandelker@kantorlawonline.com

Attorneys for Petitioners Attorneys for Respondent Data and Field Services, Inc.

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 HENRY T. BERGER

By:
Henry T. Berger

127 West 77th Street

New York, New York 10024
Telephone: (212) 799-9378
Facsimile:
berger@election-law.com

– and –

STUDIO LEGALE

By:
Robert A. Mulhall

1001 Clove Road

Staten Island, New York 10301
Telephone: (718) 816-6767
Facsimile: (718) 816-0350
motionwarrior@gmail.com

Attorneys for Respondent David Thomas, as the

Treasurer of Debi Rose 4 City Council

So Ordered:

____________________________________________
Hon. Anthony I. Giacobbe, J.S.C.