Complaint filed against Mich. SC justice over allegations



DETROIT (Legal Newsline) - A former member of the Michigan Judicial Tenure Commission confirmed Wednesday he has submitted a complaint against a sitting state Supreme Court justice who is alleged to have engaged in suspicious real estate transactions.

Dan Pero was appointed to the JTC by former Gov. John Engler, a Republican who served from 1991 to 2003. He served on the commission for only a couple years, the former chief of staff said.

In a phone interview Wednesday, Pero called the allegations against Justice Diane Hathaway "very damning."

Earlier this month, WXYZ-TV in Detroit aired a story about Hathaway, questioning how ethical she was in convincing her bank to let her out of her mortgage on her Lake St. Clair, Mich., home.

According to the television station's report, which aired on its 11 p.m. newscast May 9, the justice convinced her bank last November that she couldn't afford to keep making payments on the home, even though her other lakefront home in Florida was paid for.

Hathaway's bank apparently allowed her to do a short sale.

A short sale is often used as an alternative to foreclosure because it reduces additional fees and costs to both the creditor and borrower.

WXYZ reported that the transaction was just part of a "strange real-estate shuffle."

"(The report) raised a lot of very serious questions about how the justice handled the short sale, whether or not assets were moved and if any ethics were violated," Pero said.

He said he waited about a week before taking action.

"She refuses to talk to reporters. She has refused to make any public comment," he said. "I waited to see if she would, but nothing. So I filed a complaint."

Pero said he mailed his complaint Thursday.

"That's very questionable behavior that you just don't expect from any judge, much less a judge on the state Supreme Court," he said.

Then, take into account that there are thousands of homeowners in Michigan in the process of losing their homes, or have already lost their homes, in similar short sales, Pero said.

"If her name was Diane Hathaway and she was a cashier at a department store, I don't think anyone would question that the bank would give her the same deal," he said.

The JTC, which is responsible for investigating complaints of judicial misconduct by state judges, will not say if it has received Pero's complaint, much less if it is looking into the matter.

"The commission does not comment on whether it is investigating or not," Paul J. Fischer, executive director and general counsel, said in an email.

The commission has no jurisdiction over federal judges or administrative law judges such as workers' compensation magistrates, department of corrections hearing officers, and the like.

Its authority is limited to investigating alleged judicial misconduct -- which includes any improper off-the-bench conduct -- and, if warranted, recommending discipline.

"I really hope the JTC would look into this," Pero said, noting that he understands that the commission can't speak on the matter.

"Hopefully they can get some answers. Not just for the people of Michigan, but, in particular, those people who find, or have found, themselves in the same position she did."

Pero said if he was still a commissioner, he wouldn't hesitate in pursuing the complaint.

"I would definitely ask that we do something," he said. "It would be incumbent on us, as the watchdog of the judiciary, that we investigate and try to do something about it."

Pero is currently listed as a senior consultant for Strategic Federal Affairs.

SFA describes itself as a "federal government relations firm that specializes in working with the U.S. House of Representatives and the White House's federal departments and agencies."

According to his bio on the SFA website, Pero also is president of Pero Consulting Inc. and the American Justice Partnership, a national coalition of more than 60 organizations focused on legal reform.

From Legal Newsline: Reach Jessica Karmasek by email at

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