SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF ALBANY
_______________________________________________

STEVEN MAHLER and DANIEL GARROW,

Plaintiffs,

-against- COMPLAINT

S. JOHN CAMPANIE, CAMPANIE & WAYLAND-

SMITH PLLC, and THOMAS P. DiNAPOLI, AS
COMPTROLLER OF THE STATE OF NEW YORK,

Defendants.
_______________________________________________

Plaintiffs, Steven Mahler and Daniel Garrow, by their attorneys Boies, Schiller & Flexner

LLP, make the following allegations:

INTRODUCTION

1. This action, brought pursuant to State Finance Law § 123 and General Municipal

Law § 51, seeks restitution and declaratory and injunctive relief relating to the past and ongoing

misuse of State funds to pay S. John Campanie to represent Madison County in matters involving

the Oneida Nation of New York and relating to certain other misuse of State and County funds to

pay expenses of operating Defendant Campanie's private office. To date, at least $800,000, and

on information and belief more than $1 million, in State and County funds have been illegally

disbursed to Defendant Campanie or through his law firms, the Kiley Law Firm PC and

Defendant Campanie & Wayland-Smith PLLC.

2. Defendant Campanie is the County Attorney for Madison County. The Board of

Supervisors appointed Defendant Campanie as County Attorney and fixed his salary. State law

forbids Defendant Campanie from obtaining additional compensation for representing Madison

County, even with the Board's approval. Nevertheless, Defendant Campanie has arranged to

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receive, and has received on an ongoing and continuous basis, substantial additional, extra-salary

compensation. He has done so by sharing in the State's payments to Nixon Peabody LLP

("Nixon Peabody"), a large private law firm that the State has paid to represent Madison County

in defense of the Oneida land claim and in many other litigation and non-litigation matters. An

example illustrates the magnitude of these extra-salary payments: from January to August 1999,

Defendant Campanie earned approximately $36,000 from his salary as County Attorney; he also

received over $124,000 through Nixon Peabody during that same period for work as County

Attorney on the Oneida land claim litigation on behalf of Madison County. Defendant

Campanie's receipt of State funds for work within his duties as County Attorney has been and is

illegal.

3. First, as County Attorney, Defendant Campanie is prohibited by County Law §

201 and Public Officers Law § 67 from receiving additional compensation for representing

Madison County. Section 201 provides that his salary "shall be in lieu of all fees," and section

67 provides that he "shall not charge or receive a greater fee or reward" than his salary. Under

these statutes, which permit no exceptions to their absolute prohibitions on additional

compensation, any extra compensation that might be paid in violation of the statutes "belong[s]

to the county," and the State can seek treble damages for funds illegally paid. Moreover, Rule

1.15 of the New York Rules of Professional Conduct requires Defendant Campanie to turn these

funds over to the county and to avoid commingling them or using them for his own benefit, none

of which he has done.

4. Second, Defendant Campanie's receipt of extra compensation involves conflicts

of interest and interests in County contracts, in violation of General Municipal Law § § 801. As

County Attorney, he decided or helped to decide which lawyers would represent Madison

County in disputes with the Oneida Nation, and, although the County Board already had chosen

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Defendant Campanie to represent the County for a set salary, he selected both himself and the

Nixon Peabody firm to represent the County in certain matters and arranged to be paid additional

compensation as if he were an outside, private attorney billing for fees for County representation

in addition to his set salary. As County Attorney, Defendant Campanie had a conflict of interest

with respect to the foregoing, which constituted self-dealing. Moreover, Defendant Campanie

then proceeded to bill through the Nixon Peabody firm and to receive payment through the firm.

Defendant Campanie thus had a prohibited interest in Nixon Peabody's contract to represent

Madison County. General Municipal Law § 801 prohibits such interests in county contracts.

5. Defendant Campanie put himself in the position of supervising Nixon Peabody's

legal work for Madison County. That supervision involved the quality of the work and the

soundness of the strategies followed. Yet Defendant Campanie is paid through Nixon Peabody,

relies on Nixon Peabody to evaluate the merit of his work, benefits personally from a

continuation of all the litigation involved and would suffer economically from its settlement. A

County Attorney should consider County interests separately from his own interests in

continuing to receive extra-salary compensation for continuing and not settling litigation. That

Defendant Campanie has been receiving extra-salary compensation for at least twelve years, and

will be doing it in the future unless enjoined, provides a troubling explaination for Madison

County's opposition to settlement of longstanding disputes with the Oneida Nation.

6. Third, the State was not authorized to pay Defendant Campanie for most of his

work representing Madison County, even if he were considered a private attorney and not the

County Attorney. State Law § 10 authorizes State payments only for work by the County's

private attorneys on the Oneida land claim litigation, and then only for a relatively small part of

that work involving defense against a claim "to recover lands within the state." Of the more than

$12 million the State has paid to Nixon Peabody and Defendant Campanie, it appears that a

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substantial portion or most has been for work for which State Law § 10 does not authorize

payment, such as tax and trust litigation and for lobbying state and federal legislative and

administrative officials in Albany, New York and in Washington, D.C.

7. Fourth, Defendant Campanie misrepresented the nature of his work. In annual

ethics disclosures dating back to 1998, Defendant Campanie submitted a form stating that the

work for which he received additional, extra-salary compensation was for the "defense of the

Oneida Indian Land Claim." See Campanie's 1998 Annual Statement of Financial Disclosure,

attached hereto as Exhibit A. But, in fact, Defendant Campanie (like Nixon Peabody, through

which he billed) has billed for a substantial amount of work other than the Oneida land claim,

including for tax litigation, administrative proceedings involving a trust land application, trust

land litigation, lobbying, and other matters not involving the Oneida land claim cases. Any

effort by Defendant Campanie to characterize his work as work in defense of the Oneida land

claim would have been to facilitate otherwise unauthorized receipt of State's funds.

(Remarkably, an early disclosure form admitted that the payments received through Nixon

Peabody were additional compensation for working as County Attorney, but Defendant

Campanie deleted that admission in later disclosure reports once he apparently realized the

payment to him of additional compensation is illegal. Compare Campanie's 1998 and 1999

Annual Statements of Financial Disclosure, attached hereto as Exhibits A and B).

8. Fifth, in addition to the State payments, Defendant Campanie has received from

Madison County lump sum expense reimbursements (i.e., paid by the County as a lump sum

without having received particularized, detailed billing with backup for each individual charge

for which reimbursement is made), even including reimbursement for expenses to support his

private law office. Those payments violate County Law § 203, which forbids lump sum expense

reimbursement, and, so far as they are for expenses of his private law office, also violate the

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prohibition on additional, extra-salary compensation. Upon information and belief, these

payments to support Defendant Campanie's private law office total $6,000 per year and are

ongoing.

9. Defendant DiNapoli has authorized and has failed and refused to either cease

these illegal payments to Defendant Campanie or to seek the return of these illegal payments to

the State of New York, despite written requests that he do so and despite his duty as State

Comptroller to superintend the fiscal concerns of the state. See Letter to New York State

Comptroller Thomas P. DiNapoli, dated October 25, 2010, attached hereto as Exhibit C.

10. Important public interests are involved here. The public has an interest in

preventing the improper expenditure of State and County funds, in preventing the unlawful

enrichment of public officers, and in preventing conflicts of interest in the administration of

public contracts. The public is rightly concerned that more than $1 million in state and county

funds not be spent improperly. The public is rightly concerned that public officers, like County

Attorneys, conduct the public's business, including litigation, free of the compromise produced

by conflicting self-interest. The County is entitled to a County Attorney who exercises his or her

functions and provides legal advice to the County free of direct and personal financial interest in

the outcome. The public also has a strong interest in recovering funds that have been wrongfully

disbursed.

PARTIES

11. Plaintiff Steven Mahler is a citizen and taxpayer of New York State and a resident

of Madison County. He pays taxes on a real property assessment of more than $1,000.

12. Plaintiff Daniel Garrow is a citizen and taxpayer of New York State and a resident

of Madison County. He pays taxes on a real property assessment of more than $1,000.

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 13. Defendant S. John Campanie is the County Attorney for Madison County. He has

held this position since his appointment in 1987.

14. Defendant Campanie & Wayland-Smith PLLC is a law firm based in Oneida

County, New York. On information and belief, Defendant Campanie has been a member and

majority owner of Campanie & Wayland-Smith PLLC since August 14, 2000.

15. Defendant Thomas P. DiNapoli is Comptroller of the State of New York and is

sued in his official capacity.

STANDING, JURISDICTION, AND VENUE

16. Plaintiffs, as citizen taxpayers, have standing to bring this action under State

Finance Law § 123-b(1). Plaintiffs have standing to bring this action under General Municipal

Law § 51 because they pay taxes in Madison County on real property assessments exceeding

$1000.

17. Pursuant to State Finance Law § 123-c(1), the Supreme Court has jurisdiction,

and venue is proper in Albany County in that some or all of the illegal disbursements took place

in Albany County.

FACTUAL BACKGROUND

I. The Oneida Land Claim Litigation

18. For many years the State of New York paid private counsel to represent Madison

County (and also Oneida County) in federal land claim litigation brought by the Oneida Nation

of New York concerning land in Madison County and Oneida County. That litigation began

with Oneida Indian Nation v. County of Oneida (N.D.N.Y. Case No. 70-CV-35), often referred

to as the "test case," which was resolved by entry of judgment and is no longer pending.

19. From the beginning, the State's payments have been made based on the invocation

of State Law § 10, which authorizes the State to pay a county's lawyer "for the defense of any

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action or proceeding[] against" the county if the action or proceeding is "to recover lands" from

the county. Section 10 authorizes payment for legal work to prevent a plaintiff from recovering

county lands, but, as the courts have decided, does not authorize payment for legal work to

protect a county from paying money damages (such as rent) based on a claim that the County

does not own its lands.

20. In 1974, the Oneidas filed a broader land claim action against Madison County

and Oneida County, No. 74-CV-187. New counsel from the Boston firm of Goodwin, Proctor &

Hoar represented the counties in that case and in No. 70-CV-35, which was still pending at that

time. The State of New York was also named as a defendant, but the State was ultimately

dismissed on immunity grounds.

21. In 1998, the United States intervened as a plaintiff in No. 74-CV-187 on behalf of

the Oneidas so that the State of New York, which has no immunity as against the claims of the

federal government, could again be made a defendant.

II. The County Attorney's Decision to Bill through Nixon Peabody for Additional,
Extra-Salary Compensation for County Representation

22. In or about 1998, Madison County and Oneida County engaged Nixon Peabody

to represent them in the land claim litigation, with the State agreeing to pay the bills, as for

counsel in earlier years. Payments by the State were made under at least the following contract

numbers: C003088, C102843, and C102844. Payments from the State to Nixon Peabody under

the contracts over the past twelve years have exceeded $12 million. The billing by Nixon

Peabody continues, as do, on information and belief, the payments by the State.

23. At about the same time that Nixon Peabody was retained, Madison County

Attorney, Defendant Campanie, arranged to be paid additional, extra-salary compensation

through Nixon Peabody for representing the County. Like all previous Madison County

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Attorneys, Defendant Campanie (who was first appointed in May 1987) was and is restricted to

the salary established for his office by the Board of Supervisors. An illegal arrangement began

in 1998, nevertheless, whereby Defendant Campanie would bill through and be paid by Nixon

Peabody from funds paid by the State of New York pursuant to Nixon Peabody's contracts, such

as those specified above in the previous paragraph. Thus, Campanie received a direct, personal

benefit from the retention of Nixon Peabody. Not only was this additional compensation in

excess of his salary illegal for Defendant Campanie as County Attorney, but he also put himself

in the position of regularly accepting funds from a law firm that had a contract to represent the

County subject to supervision from Defendant Campanie.

24. Defendant Campanie was paid through Nixon Peabody a monthly, lump sum

payment of $6,500, without regard to hours, for most months. At times, he submitted bills to

Nixon Peabody for fees far in excess of that amount. He has, on information and belief, received

over $1 million through Nixon Peabody to date, and the payments continue.

25. On information and belief, all bills covering the time period through August 13,

2000 were submitted to Nixon Peabody on Defendant Campanie's behalf by his then-law firm,

Kiley Law Firm PC. Bills covering the period from August 14, 2000 until the present were

submitted to Nixon Peabody on Defendant Campanie's behalf by his law firm, Defendant

Campanie & Wayland-Smith PLLC. All payments to Campanie by Nixon Peabody described

herein were made via the Kiley Law Firm PC and Defendant Campanie & Wayland-Smith

PLLC.

III. Payments Through Nixon Peabody

26. In a 1998 ethics disclosure form relating to his work as County Attorney,

Defendant Campanie recorded the following admission of his plan to receive additional, extra-

salary compensation:

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 Lastly, there is a proposal pending that for 1999 may result in additional
compensation for extraordinary time commitments in defense of the
Oneida Indian Land Claim, to be paid by New York State. (Emphasis
added).

See Campanie's 1998 Annual Statement of Financial Disclosure, attached hereto as Exhibit A.

The reference to "additional compensation" was to payments Defendant Campanie expected to

receive over and above his County Attorney salary fixed by the Board of Supervisors. The

reference to the Oneida land claim defined the extent of the work for which additional

compensation would be sought. There was no reference to the laws forbidding additional

compensation. There was no explanation why an extraordinary time commitment was required

by Defendant Campanie, or why the work would not be duplicative and unnecessary, given the

fact that Nixon Peabody would be representing Madison County – and given the fact that the

Attorney General had appeared in the action, along with the large law firm of White & Case,

acting as outside counsel to the State, advancing every argument that Madison County advanced.

Defendant Campanie never entered an appearance as counsel for Madison County in either of the

land claim cases, No. 70-CV-35 or No. 74-CV-187, for which he sought to be paid the additional

compensation.

27. For each of the following years (although plaintiffs are not in possession of

disclosure forms for 2009 or 2010), Defendant Campanie phrased his ethics disclosure form to

avoid the use of the incriminating "additional compensation" term that had been included in the

report for 1998. For 1999, for example, Defendant Campanie, presumably then aware of the

statutory prohibition on additional compensation, wrote the following:

Lastly, in connection with the extraordinary time commitments in

defense of the Oneida Indian Land Claim, and pursuant to discussions by
and among New York State, Nixon Peabody LLP and the Counties, bills
have been submitted by the Kiley Law Firm PC [Defendant Campanie's
then-firm] to Nixon Peabody LLP and in turn by Nixon Peabody LLP to

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 the State of New York, pursuant to the understanding that as part of its
contract with New York State to defend the Counties, such billings will
be paid by New York State. The final amount to be paid by New York
State is still a matter of negotiation.

See Campanie's 1999 Annual Statement of Financial Disclosure, attached hereto as Exhibit B.

The reference to "discussions" and to "the understanding" suggests that Defendant Campanie's

arrangement was not documented in a written contract. The description also suggests that

Defendant Campanie billed pursuant to Nixon Peabody's contract, although those contracts do

not mention Defendant Campanie. Further, the Nixon Peabody bills to the State merely listed

payments to Defendant Campanie as a lump sum disbursement by the Nixon Peabody firm, with

no time records or details. Moreover, on at least one Nixon Peabody bill where the requested

reimbursement to Defendant Campanie and the Oneida County Attorney is approximately

$143,000, there is absolutely no reference to a payment to Defendant Campanie. That payment

is merely lumped into a request for $165,691.49 in "Charges and Disbursements." See Statement

for Legal Services, dated September 15, 1999, attached hereto as Exhibit D.

IV. Payments for Work on Non-Land Claim Matters

28. Defendant Campanie (like Nixon Peabody, through which he billed and from

which he received a portion of payments made by the State to Nixon Peabody) has billed and

received payment for work on matters outside of the land claim cases – the tax, trust and

lobbying work described above. See Oneida Indian Nation v. Madison County, 401 F. Supp.2d

219 (N.D.N.Y. 2005) (the "Tax Litigation"); State v. Salazar, 2010 U.S. Dist. Lexis 32497, No.

08-CV-644 (N.D.N.Y. 2010) (the "Trust Litigation"). The level of payments – which exceed a

total of $12 million – reveals that such non-land claim work was included in the bills because so

much work could not have been done just on the land claim litigation.

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 29. Even as to work on the land litigation, Defendant Campanie (through Nixon

Peabody) billed the State for work that did not concern recovery of lands from the Counties, the

only circumstance that can justify payment under State Law § 10, the statute under which

payments were sought and under which they were made. Section 10 authorizes only payment for

a legal defense against claims for recovery of the Counties' lands, and not for most of the work

that Defendant Campanie billed through Nixon Peabody. In June 2005, the Second Circuit Court

of Appeals held in Cayuga v. Pataki, 413 F.3d 266 (2d Cir. 2005), that Indian tribes in New

York could not sue to recover lands long-ago sold to the State and obtained by its counties or by

others. Madison County was, therefore, no longer even theoretically exposed to a claim for

recovery of its lands by the Oneidas. Yet for the following five or more years Defendant

Campanie and Nixon Peabody have continued to bill the State for all the work they did on land

claim matters, even though they could not possibly be said to involve recovery of county lands

and, of course, also for work on matters involving trust, tax and other non-land claim disputes.

30. At the very least, no work on land claim matters has been needed since argument

on June 3, 2008 in the Second Circuit on appeal from a District Corut order partially granting

and partially denying the State and the Counties' motion for partial judgment. Yet bills were

submitted to and paid by the State for the rest of 2008, all of 2009, and continuing into 2010.

Those bills almost certainly were for non land claim work involving, among other things, the

Tax Litigation and the Trust Litigation that the Counties chose to file against the Oneidas.

V. Lump Sum Expense Payment to County Attorney Campanie

31. Although County Law § 203 forbids "lump sum" reimbursements "in lieu of

actual and necessary disbursements" involving specifically, separately itemized expenses, the

Madison County Board of Supervisors passed a resolution authorizing monthly lump sum

payments of $500 to Defendant Campanie as reimbursement for such things as having a library,

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computers, telephones and staff in his private law office, located outside of Madison County,

from which he apparently does some Madison County Attorney work as a convenience to

himself. Defendant Campanie, of course, would maintain his private law library and email-

capable computers even if he were not also the County Attorney and even if he chose to do all of

his County Attorney work at the public office that Madison County provides for Defendant

Campanie at County expense at the County Office Building. For that reason, the payments are

also illegal under County Law § 203 as not for a reimbursable expense, which means they are

prohibited additional compensation, even if they were not impermissibly made in a lump sum

and not for specific itemized expenses.

COUNT I

(County Law §§ 201 and 501; Public Officers Law § 67; State Finance Law § 123-b and
General Municipal Law § 51 - Misappropriation of State Funds and Waste)
(Against Defendants Campanie, and Campanie & Wayland-Smith PLLC)

32. Plaintiffs repeat and reallege the foregoing allegations as if fully set forth herein.

33. As County Attorney, it is Defendant Campanie's job to represent Madison County

in all of its legal matters; any legal representation that he provides the County falls within his

duties. County Law § 501(1) provides that the County Attorney "shall … defend all civil actions

or proceedings brought by or against the county." County Law § 501(3) also requires that

Defendant Campanie "shall perform such additional and related duties as may be prescribed by

law and directed by the board of supervisors."

34. The compensation of a County Attorney is to be fixed by the County's Board of

Supervisors in the form of a salary, and is not open to supplementation through side payments.

[E]ach board of supervisors shall fix the salary of all such officers paid
from county funds, except the members of the judiciary. Such salary
shall be in lieu of all fees, percentages, emoluments or other form of
compensation payable for services rendered in the performance of the
powers and duties of the office.

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County Law § 201. Section 201 further stipulates that fees received by Defendant Campanie or

any County Attorney "by virtue of his office from whatever source" are required to "be paid into

the county treasury" because they "belong to the county." (Emphasis added). Under this

provision of section 201, the funds Defendant Campanie has received are client property

misappropriated by Defendant Campanie and his law firms. Rule 1.15 of the New York Rules of

Professional Conduct prohibits such commingling and misappropriation of client funds.

35. Similarly, Public Officers Law § 67 provides that persons such as County

Attorneys, whose compensation for a service is allowed by law, "shall not charge or receive a

greater fee or reward, for that service, than is so allowed." Section 67 authorizes the State to

seek treble damages for any funds received in violation of the statute. Any purported direct or

indirect agreement between Madison County and Defendant Campanie to vary this or any other

provision of state law is null and void.

36. In Thompson v. Hofstatter, 265 N.Y. 54, 61 (1934), the Court of Appeals

explicitly addressed the question of "whether a County Attorney can thus be paid additional

compensation over and above his salary for ordinary legal attorney work because the salary fixed

is not an adequate compensation," holding that:

It is a well-settled rule that a person accepting a public office, with a

fixed salary, is bound to perform the duties of the office for the salary.
He cannot legally claim additional compensation for the discharge of
these duties, even though the salary may be a very inadequate
remuneration for the services. Nor does it alter the case that by
subsequent statutes or ordinances his duties within the scope of the
charter powers pertaining to the office are increased and not his salary.
Whenever he considers the compensation inadequate, he is at liberty to
resign.

Id. at 65 (quoting 1 John F. Dillon, Municipal Corporations § 426 (5th ed.)).

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 37. Because these payments to Defendant Campanie are illegal under Public Officers

Law § 67 and County Law § 201, Defendant Campanie has caused a misappropriation of state

funds under State Finance Law § 123-b. Defendant Campanie should be enjoined from receiving

any further such payments and compelled to account for and repay those funds he has already

received.

38. Because these payments to Defendant Campanie are illegal under Public Officers

Law § 67 and County Law § 201, they constitute waste under General Municipal Law § 51.

Defendant Campanie should be enjoined from receiving any further such payments and

compelled to repay those funds he has already received.

COUNT II

(General Municipal Law §§ 801 and 804; State Finance Law § 123-b and General
Municipal Law § 51 - Misappropriation of State Funds and Waste)
(Against Defendants Campanie, and Campanie & Wayland-Smith PLLC)

39. Plaintiffs repeat and reallege the allegations in paragraphs 1 to 31 as if fully set

forth herein.

40. General Municipal Law § 801 prohibits Defendant Campanie from having an

interest in Madison County's contract with Nixon Peabody for legal representation. Madison

County has an oral or written contract with Nixon Peabody through which the retention of the

firm as the County's lawyers was established. For Defendant Campanie to be paid as if he were a

part of the Nixon Peabody firm or covered by its contracts, and to receive checks from the Nixon

Peabody firm, gives him a prohibited interest in County contracts.

41. Under General Municipal Law § 804, "[a]ny contract willfully entered into by or

with a municipality in which there is an interest prohibited by this article shall be null, void and

wholly unenforceable." Any purported direct or indirect agreement between Madison County

and Defendant Campanie is null and void.

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 42. Because this agreement is unlawful under General Municipal Law § 801, by

receiving payments under it, Defendant Campanie caused a misappropriation of state funds

under State Finance Law § 123-b. Defendant Campanie should be compelled to repay those

funds he has already received under this agreement and enjoined from receiving any further such

payments, and all direct and indirect contracts between Madison County and Defendant

Campanie with respect to billing a payment through Nixon Peabody should be declared void.

43. Because this agreement is unlawful under General Municipal Law § 801,

payments to Defendant Campanie under the agreement constitute waste under General Municipal

Law § 51. Defendant Campanie should be compelled to repay those funds he has already

received under this agreement and enjoined from receiving any further such payments, and all

direct and indirect contracts between Madison County and Defendant Campanie should be

declared void.

COUNT III

(State Law § 10; State Finance Law § 123-b and General Municipal Law § 51 -
Misappropriation of State Funds and Waste)
(Against Defendants Campanie, and Campanie & Wayland-Smith PLLC)

44. Plaintiffs repeat and reallege the allegations in paragraphs 1 to 31 as if fully set

forth herein.

45. State Law § 10 authorizes state payments for the County's legal work only for

work relating to recovery of land:

The governor shall, at the expense of the state, employ counsel and
provide for the defense of any action or proceeding, instituted against the
state, or against any person deriving title therefrom, to recover lands
within the state, under pretence of any claim inconsistent with its
sovereignty and jurisdiction.

46. The State's indemnity of County legal fees and expenses has not been restricted to

the payments authorized by § 10. State payments have been made to Defendant Campanie and

15
Nixon Peabody for work entirely outside the land claim litigation, work that involved tax

disputes, trust land disputes, lobbying and public relations work.

47. Further, the bulk of the legal work performed by Defendant Campanie and Nixon

Peabody in the land claim litigation could not have included and did not include defense of a

claim to recover county land, the sole basis under state law for the State to pay the County's legal

fees. For example, the bulk of the work involved defense of claims for monetary damages,

which did not involve efforts to recover county land and has been held by the courts not to be

covered by § 10.

48. Because these payments to Defendant Campanie are not authorized by State Law

§ 10, Defendant Campanie has caused a misappropriation of state funds under State Finance Law

§ 123-b. Defendant Campanie and his law firm should be enjoined from receiving any further

payments under State Law § 10 for work not involving the defense of an action to recover lands

within the state. Defendant Campanie and his law firm should be compelled to repay all funds

already received for work not authorized by State Law § 10.

49. Because these payments to Defendant Campanie are not authorized by State Law

§ 10, they constitute waste under General Municipal Law § 51. Defendant Campanie and his law

firm should be enjoined from receiving any further payments under State Law § 10 for work not

involving the defense of an action to recover lands within the state. Defendant Campanie and his

law firm should be compelled to repay all funds already received for work not authorized by

State Law § 10.

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 COUNT IV

(County Law §§ 201 and 203; Public Officers Law § 67; Finance Law § 123-b and General
Municipal Law § 51 - Misappropriation of State Funds and Waste)
(Against Defendants Campanie, and Campanie & Wayland-Smith PLLC)

50. Plaintiffs repeat and reallege the allegations in paragraphs 1 to 31 as if fully set

forth herein.

51. The Madison County Board of Supervisors passed a resolution authorizing

monthly lump sum payments of $500 to Defendant Campanie to cover certain expenses of his

private law office operated as Campanie & Wayland-Smith. The County Attorney has a public

office in the County Building, provided at public expense. The resolution indicates that

Defendant Campanie prefers to conduct some public business from his private law office –

which is not even located in Madison County.

52. The lump sum payments violate County Law § 203, which prohibits lump sum

expense reimbursements.

53. That illegality is compounded by the fact that $500 payments cover items that

Defendant Campanie would have had to purchase whether or not he were County Attorney, such

as law books, computers and staff who answer telephone calls. Such payments for expenses not

directly incurred in doing work as the county Attorney constitute prohibited additional

compensation to the County Attorney in violation of County Law §§ 201 and 203 and Public

Officers Law § 67.

54. Because these payments to Defendant Campanie are prohibited by County Law

§§ 201 and 203 and Public Officers Law § 67, Defendant Campanie has caused a

misappropriation of state funds under State Finance Law § 123-b. Defendant Campanie and his

law firm should be enjoined from receiving any further lump sum payments, and should be

compelled to repay all such payments already received.

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 55. Because these payments to Defendant Campanie are prohibited by County Law

§§ 201 and 203 and Public Officers Law § 67, they constitute waste under General Municipal

Law § 51. Defendant Campanie and his law firm should be enjoined from receiving any further

lump sum payments, and should be compelled to repay all such payments already received.

COUNT V

(Public Officers Law § 67 and Finance Law § 123-b - Misappropriation of State Funds)
(Against Defendant DiNapoli)

56. Plaintiffs repeat and reallege the allegations in paragraphs 1 to 31 as if fully set

forth herein.

57. Despite written demand that he do so, Defendant DiNapoli has refused to prevent

continued illegal payments to Defendant Campanie and his law firm as set forth above. The

Office of the Comptroller, on information and belief, continues to make such payments, and

declines to recover illegal payments already made.

58. Because he has failed and refused to voluntarily discontinue such illegal

payments, or to seek to recover those already made, Defendant DiNapoli has caused a

misappropriation of state funds under State Finance Law § 123-b. Defendant DiNapoli should

be permanently enjoined from making those payments, and compelled to bring an action under

Public Officers Law § 67 to recoup those funds already wrongfully paid.

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 PRAYERS FOR RELIEF

WHEREFORE, Plaintiffs request that the Court:

A. Enjoin Defendant DiNapoli from making any further payments to

Defendants Campanie or Campanie & Wayland-Smith PLLC relating in

any way to litigation or disputes involving the Oneida Nation or any

matter relating to representation of Madison Count7y, pursuant to State

Finance Law § 123-e(1);

B. Compel Defendant DiNapoli to bring an action under Public Officers Law

§ 67 to recoup funds illegally paid to Defendant Campanie, pursuant to

State Finance Law § 123-e(1);

C. Compel repayment by Defendants Campanie and Campanie & Wayland-

Smith PLLC to Madison County, or alternatively, to the State of New

York of all funds illegally paid to Defendants Campanie, or Campanie &

Wayland-Smith PLLC, pursuant to State Finance Law § 123-e(1) and

General Municipal Law § 51;

D. Declare void any and all direct and indirect contracts between Madison

County and Defendant Campanie for representation relating to the Oneida

Nation of New York, pursuant to State Finance Law § 123-e(1) and

General Municipal Law § 51;

E. Enjoin Defendant Campanie from receiving any extra-salary

compensation or reimbursement for work within the scope of his duties as

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 Madison County's County Attorney, pursuant to State Finance Law § 123-

e(1) and General Municipal Law § 51;

F. Award costs and fees to Plaintiffs in accordance with State Finance Law

§ 123-g; and

G. Award such other relief to which plaintiffs may be entitled at law or in

equity or to which they otherwise may be entitled.

DATED: April 11, 2011 BOIES, SCHILLER & FLEXNER LLP

By:
George F. Carpinello
10 North Pearl Street, 4th Floor
Albany, NY 12207
Ph: 518-434-0600

Attorneys for Plaintiffs

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