Prepared: March 26, 2026 For: Plaintiff's Counsel Re: Discovery Demands and Deposition Framework — Trust Accounts, Fee Allocation, and Financial Record Discrepancies
Richard C. Litman ("Plaintiff") is entitled under the Combination Agreement and subsequent arbitration award to 20% of all collected fees on matters he originated during his tenure at Nath, Goldberg & Meyer ("NGM"). Joshua B. Goldberg ("Defendant") served as Co-Managing Partner with sole control over NGM's financial operations, trust accounts, billing systems, and payment allocations from at least 2020 through the present.
Preliminary analysis of financial documents already produced — including Defendant's own spreadsheets, trust bank journals, invoice summaries, and payment allocation reports — has identified the following irregularities requiring forensic accounting investigation:
$15 Million Trust Account Discrepancy. NGM's three trust accounts (Eagle Bank Trust Account ending in 0495, Bank of America Escrow Account ending in 8777, and Bank of America Wire Account ending in 8751) show total inflows of approximately $32.7 million. However, Defendant's own workup (the "NGM Litman Workup") reports only $16.5 million in total receipts — a discrepancy of approximately $15 million that remains unexplained.
Zero-Revenue Attribution for Major Clients. The NGM Litman Workup's "Revenue" sheet reports $0 in receipts for King Faisal University ("KFU") and King Saud University ("KSU") — despite verified actual payments of approximately $11.6 million from these two clients alone (KFU: approximately $12.3 million collected; KSU: substantial additional collections across docket prefixes 33032, 33056, and 33092).
Direct Trust-to-Operating Transfers. Documents show transfers from the Bank of America Wire Account (ending 8751) directly to NGM's operating account. Client trust funds held in IOLA or attorney trust accounts are subject to strict fiduciary obligations under New York Rules of Professional Conduct, Rule 1.15. Direct transfers to an operating account without proper allocation and documentation raise serious questions about trust account management.
Recording Error on Major Wire Transfer. A $595,214 wire transfer was recorded with a $1,000 discrepancy — entered as either $594,214 or $596,214 (a variance of $1,000). While the dollar amount is modest relative to the total, the existence of a recording error on a transaction of this magnitude calls into question the reliability of the entire accounting system.
Missing January 2024 Payment. The January 2024 payment of $132,637 (Plaintiff's 20% share of $663,183.38 in collected fees) appears in the Litman Summary spreadsheet as "Paid" but does not appear in the NGM Litman Workup. This omission — of a six-figure payment to Plaintiff — requires explanation.
Unpaid Invoices Not Allocated. Four specific invoices have been identified as paid by clients but not allocated to Plaintiff's 20% share. The identity of these invoices has been documented and will be referenced in deposition.
Freedom Bank Historical Layer. NGM maintained accounts at Freedom Bank during an earlier period. The relationship between Freedom Bank accounts, the current Eagle Bank and Bank of America accounts, and the flow of client trust funds through these institutions has not been explained.
CPA Statement Regarding Trust Account Closure. Deborah Schaefer, NGM's Certified Public Accountant, told Plaintiff that trust accounts were being closed because "you're not supposed to have trust money for your own money." This statement, if accurate, suggests potential commingling of client trust funds with firm operating funds — a serious ethical violation under Rule 1.15.
Umbrella Docket Magnitude. KFU umbrella docket 36372 encompasses $10.84 million across 871 entries. KSU umbrella docket 35610 encompasses $3.72 million across 388 entries. The scale of these dockets — $14.56 million combined — demands line-item reconciliation that has never been provided.
These demands are made pursuant to CPLR 3101(a) (full disclosure of all matter material and necessary), CPLR 3120 (discovery and production of documents), and CPLR 3130 (interrogatories). The financial records demanded below are directly relevant to (1) the commercial value of Plaintiff's name as used by Defendant under NY Civil Rights Law Sections 50-51, (2) Defendant's profits derived from the unauthorized use of Plaintiff's name, and (3) damages under Section 51, which include "any profits attributable to the use."
Demand No. 1. All bank statements, deposit slips, wire transfer confirmations, and withdrawal records for Eagle Bank Trust Account ending in 0495 (designated as "t23" in NGM internal records) from January 1, 2017 to the present.
Demand No. 2. All bank statements, deposit slips, wire transfer confirmations, and withdrawal records for Bank of America Escrow Account ending in 8777 (designated as "t3" in NGM internal records) from January 1, 2017 to the present.
Demand No. 3. All bank statements, deposit slips, wire transfer confirmations, and withdrawal records for Bank of America Wire Account ending in 8751 (designated as "Wire_8751" in NGM internal records) from January 1, 2017 to the present.
Demand No. 4. All bank statements, deposit slips, wire transfer confirmations, and withdrawal records for any and all Freedom Bank accounts maintained by NGM, Nath Associates, PLLC, Nath & Associates, or any affiliated entity from January 1, 2015 to the date of account closure, together with records documenting the closure of such accounts and the transfer of balances therefrom.
Demand No. 5. All records of any and all transfers between any trust account and any operating account of NGM, Nath Associates, PLLC, Nath & Associates, or any affiliated entity from January 1, 2017 to the present, including but not limited to journal entries, transfer authorizations, and ledger entries documenting the purpose and client attribution of each transfer.
Demand No. 6. All IOLA account records, including account opening documents, signatory cards, and any correspondence with banks regarding the establishment, maintenance, or closure of IOLA accounts, from January 1, 2017 to the present.
Demand No. 7. All versions of the document internally identified as "NGM Litman Workup" or any workup, compilation, or summary prepared by or on behalf of Defendant relating to fees, receipts, or revenue attributed to Richard Litman-originated matters, from January 1, 2017 to the present, including all drafts and revisions.
Demand No. 8. All Fee Allocation Summary spreadsheets (quarterly and monthly) from 1Q2017 through the most recent quarter, including all versions, drafts, and revisions of such documents.
Demand No. 9. All Payment Allocation Reports (monthly or other periodic reports labeled "RCL as originating attorney" or similar) from January 2017 to the present.
Demand No. 10. All Invoice Summary with Accounts Receivable spreadsheets (annual and interim) for calendar years 2017 through 2025, including all versions with the "run dates" noted on each.
Demand No. 11. All docket ledger reports, client accounting ledgers, and billing journals for KFU umbrella docket 36372, including all 871 entries and any sub-docket entries not captured in the umbrella report.
Demand No. 12. All docket ledger reports, client accounting ledgers, and billing journals for KSU umbrella docket 35610, including all 388 entries and any sub-docket entries not captured in the umbrella report.
Demand No. 13. All invoices, billing statements, and fee agreements for the following KFU docket series: 32087, 33101, 33102, 33103, 33110, 33120, 33125, 33130, 33135, 33140, 33145, 33150, 33155, 33160, 33165, 33170, 33175, 33180, 33185, and 33190, from January 1, 2017 to the present.
Demand No. 14. All invoices, billing statements, and fee agreements for KSU docket series 33032, 33056, and 33092, from January 1, 2017 to the present.
Demand No. 15. The complete Receivables_All report (most recently run June 5, 2025 per produced documents), including all $3,183,565.88 in outstanding accounts receivable attributed to "Richard Litman" as responsible lawyer, together with any prior versions of this report.
Demand No. 16. All wire transfer records for the $595,214 transaction identified in the trust account records, including the originating wire instruction, receiving bank confirmation, and any internal ledger entries recording this transaction, together with any documents reflecting the $1,000 recording discrepancy.
Demand No. 17. All records of payments made to or on behalf of Richard Litman from January 1, 2020 to the present, including wire transfer confirmations, check copies, ACH records, and any other evidence of funds transfer, together with the internal allocation or journal entry supporting each payment.
Demand No. 18. All records of the January 2024 payment of $132,637 (or $132,636.68) to Richard Litman, including wire confirmation, check copy, and the internal ledger entry recording this payment, and any documents explaining why this payment does not appear in the NGM Litman Workup.
Demand No. 19. All records relating to the four invoices identified as paid by clients but not allocated to Plaintiff's 20% share, including the original invoice, proof of client payment, and any documents reflecting the allocation of the collected funds.
Demand No. 20. All engagement letters, retainer agreements, and correspondence between NGM or any affiliated entity and Deborah Schaefer, CPA, or her firm, from January 1, 2017 to the present, regarding accounting services, trust account management, or financial reporting.
Demand No. 21. All work papers, reports, reconciliations, and correspondence prepared by Deborah Schaefer, CPA, or her firm, relating to NGM's trust accounts, client escrow accounts, or IOLA accounts, from January 1, 2017 to the present.
Demand No. 22. All IRS Forms 1099 issued to or on behalf of Richard Litman by NGM, Nath Associates PLLC, or any affiliated entity from 2017 through 2025.
Demand No. 23. All IRS Forms 1065 (partnership returns) and Schedules K-1 issued to Richard Litman by NGM, Nath Associates PLLC, or any affiliated entity from 2017 through 2025.
Demand No. 24. All documents reflecting the "responsible attorney" or "originating attorney" designation in NGM's billing system (including the system referred to internally as "The Pad") for any matter originated by Richard Litman, from January 1, 2017 to the present.
Demand No. 25. Identification of all billing, accounting, and practice management software used by NGM from January 1, 2017 to the present, including version numbers, implementation dates, and the identity of all individuals with administrative access to modify client attribution, responsible attorney designations, or fee allocation formulas.
Demand No. 26. All audit logs, change logs, and system records reflecting any modification to the "responsible attorney" or "originating attorney" field for any matter originally designated to Richard Litman, from January 1, 2017 to the present.
Demand No. 27. A complete export of all data from the internal tracking system referred to as "The Pad," including all entries, modifications, and historical records for Litman-originated matters.
Interrogatory No. 1. State the total amount of client funds received into each of the three trust accounts identified above (Eagle Bank 0495, BOA 8777, BOA 8751) for each calendar year from 2017 through 2025, broken down by client and matter number.
Interrogatory No. 2. State the total amount transferred from each trust account to NGM's operating account(s) for each calendar year from 2017 through 2025, identifying the date, amount, and client matter attribution for each transfer.
Interrogatory No. 3. Explain the $15 million discrepancy between total trust account inflows (approximately $32.7 million) and the total receipts shown in the NGM Litman Workup (approximately $16.5 million), identifying for each trust account deposit not reflected in the Workup (a) the date, (b) the amount, (c) the client, (d) the matter, and (e) the reason for its omission.
Interrogatory No. 4. Explain why the NGM Litman Workup's Revenue sheet reports $0 in receipts for King Faisal University and King Saud University, when verified payments from these clients total approximately $11.6 million as documented in the KFU Receivables and Payments report (run June 11, 2025) and Invoice Summaries with AR (run June 4-6, 2025).
Interrogatory No. 5. Identify all individuals who had authority to (a) authorize transfers from trust accounts to operating accounts, (b) modify the "responsible attorney" designation in NGM's billing system, and (c) approve payment allocations to Richard Litman, for each year from 2017 through 2025.
Interrogatory No. 6. State the methodology used to calculate the amounts shown in each Fee Allocation Summary provided to Plaintiff, including (a) how "Collected Fees" were distinguished from "Collected Disbursements," (b) whether all client payments on Litman-originated matters were included, and (c) whether any payments were excluded and, if so, the reason for exclusion.
Interrogatory No. 7. Identify all persons who prepared, reviewed, or approved the NGM Litman Workup, the Fee Allocation Summaries, and the Payment Allocation Reports, for each reporting period from 2017 through 2025.
Interrogatory No. 8. State whether Deborah Schaefer, CPA, advised NGM that trust accounts should be closed because "you're not supposed to have trust money for your own money," and if so, (a) the date of such advice, (b) the persons present, (c) the specific accounts referenced, and (d) what actions were taken in response.
Interrogatory No. 9. Describe the accounting treatment of the $595,214 wire transfer identified in the trust account records, including (a) the date of the transfer, (b) the originating and receiving accounts, (c) the client matter attribution, (d) the amount recorded in NGM's books, and (e) the reason for the $1,000 recording discrepancy.
Interrogatory No. 10. Identify all client matters originated by Richard Litman for which collected fees were not included in the 20% calculation provided to Plaintiff in any Fee Allocation Summary or Payment Allocation Report, stating for each (a) the matter number, (b) the client, (c) the amount collected, and (d) the reason for exclusion.
Interrogatory No. 11. State the total amount of accounts receivable currently outstanding on matters attributed to Richard Litman as responsible or originating attorney, and identify all such matters, amounts, and client names.
Interrogatory No. 12. Describe all transfers, closures, or changes in signatory authority for Freedom Bank accounts maintained by NGM or any predecessor or affiliated entity, including the disposition of all balances upon closure.
Area 1: Trust Account Control and Authority
Area 2: The $15 Million Discrepancy
Area 3: The Zero-Revenue KFU/KSU Entry
Area 4: Wire-to-Operating Transfers
Area 5: The $595,214 Recording Error
Area 6: Missing January 2024 Payment
Area 7: Fee Allocation Methodology
Area 8: Deborah Schaefer and Trust Account Closure
Area 1: Job Duties and Systems
Area 2: Trust Account Operations
Area 3: Fee Allocation and Workup Preparation
Area 4: Specific Transactions
Area 5: The Pad
Area 1: Engagement and Scope
Area 2: Trust Account Advice
Area 3: Financial Reporting to Litman
Area 4: Tax Treatment
Plaintiff should retain a forensic accountant with experience in attorney trust accounting and law firm financial disputes. The expert's scope of work should include:
Trust Account Reconciliation. Complete reconciliation of all three trust accounts (Eagle Bank 0495, BOA 8777, BOA 8751) and the historical Freedom Bank accounts, tracing every deposit to a client matter and every withdrawal to a recipient, for the period January 2017 through the present.
Revenue Tracing. Trace all revenue collected on Litman-originated matters from initial client payment through trust account deposit, trust-to-operating transfer, fee allocation, and ultimate disbursement, identifying any amounts not properly credited to Litman's 20% share.
Workup Discrepancy Analysis. Identify and quantify the $15 million discrepancy between trust account inflows and the NGM Litman Workup, classifying each unaccounted-for dollar by client, matter, and disposition.
KFU/KSU Revenue Audit. Line-item reconciliation of all 871 entries in KFU umbrella docket 36372 ($10.84 million) and all 388 entries in KSU umbrella docket 35610 ($3.72 million), matching each invoice to a client payment and tracing that payment through to the 20% fee allocation.
Trust Account Compliance Review. Evaluate whether NGM's trust account practices — including direct Wire-to-Operating transfers, the handling of client retainers, and the stated reason for trust account closure — complied with New York Rule of Professional Conduct 1.15 (Preserving Identity of Funds and Property of Others).
Recording Error Analysis. Identify all recording errors, discrepancies, and unexplained variances in the trust account and billing records, with particular attention to the $1,000 discrepancy on the $595,214 wire transfer and any pattern of similar errors.
Damages Calculation. Calculate total underpayment to Litman, including (a) the 20% share of all collected fees that were not credited or paid, (b) prejudgment interest on unpaid amounts, and (c) the current outstanding receivables ($3.18 million) attributable to Litman-originated matters.
Pattern of Financial Control. Document Defendant's control over all financial flows — from client retainer receipt through trust deposit, billing, fee allocation, and partner distribution — to establish that Defendant had sole authority over the financial apparatus that depended on Litman's name.
The forensic accountant should hold the following credentials or equivalent:
Given the volume of records (2,426 financial documents totaling 618.9 MB already produced, plus records demanded above), the forensic accountant should be engaged no later than April 15, 2026 to complete the analysis before the deposition deadline of June 2, 2026. The expert's preliminary report should be available to guide deposition questioning. A final report can be completed after depositions and production of additional records.
If Defendant resists production of the documents demanded above, the following arguments support a motion to compel under CPLR 3124.
Damages Under Section 51. NY Civil Rights Law Section 51 authorizes recovery of "any damages sustained" and "any profits attributable to the use" of a person's name. The financial records demanded are the only means of calculating (a) the total profits Defendant derived from using Plaintiff's name on 905 patents and thousands of related documents, and (b) the amounts owed but not paid to Plaintiff.
Commercial Motive. Defendant used Plaintiff's name because that name generated $18.4 million in revenue. The financial records prove the motive — the firm was 76-79% dependent on Litman-originated work. This is directly relevant to the "for purposes of trade" element of the Section 50-51 claim.
Trust Account Records Are Not Privileged. Trust account records are fiduciary records, not work product or privileged communications. An attorney who holds client trust funds has a fiduciary duty to account for those funds, and no privilege attaches to records documenting the receipt, holding, and disbursement of client money.
Defendant has already produced partial financial records — the Fee Allocation Summaries, Payment Allocation Reports, Invoice Summaries, and Trust Bank Journals — that establish the existence of the irregularities described above. Having produced partial records that raise questions, Defendant cannot withhold the complete records that would answer those questions. See Allen v. Crowell-Collier Pub. Co., 21 N.Y.2d 403 (1968) (full disclosure is the rule; restrictions on disclosure are the exception).
If Defendant fails to produce the demanded records, Plaintiff will seek an adverse inference instruction under CPLR 3126. The $15 million discrepancy, the $0 KFU/KSU revenue entry, and the missing January 2024 payment are precisely the types of gaps that warrant an inference that the withheld records would be unfavorable to Defendant.
Given that Deborah Schaefer advised trust account closure, and given the ongoing litigation, Defendant should be reminded of his obligation to preserve all trust account records, billing records, and accounting system data. Any destruction of records after commencement of this action — or after Defendant reasonably anticipated litigation — would support sanctions under CPLR 3126 and the common-law spoliation doctrine. See Voom HD Holdings LLC v. EchoStar Satellite L.L.C., 93 A.D.3d 33 (1st Dep't 2012).
The records demanded are finite and well-defined: bank statements, billing records, and accounting reports that every law firm is required to maintain under Rule 1.15 and the Recordkeeping Requirements of 22 NYCRR 1200.0, Rule 1.15. The burden of production is minimal because these records should already exist in organized form. The $15 million discrepancy alone justifies whatever burden production may entail.
| Item | Deadline | Notes |
|---|---|---|
| Serve Document Demands (Section II) | Immediately | 20 business days to respond per CPLR 3122 |
| Serve Interrogatories (Section III) | With document demands | 20 days to respond per CPLR 3133 |
| Retain forensic accountant | By April 15, 2026 | Must complete analysis before June 2 depositions |
| Depose Valencia Gray | Before Goldberg | Establish accounting facts before confronting Goldberg |
| Subpoena Deborah Schaefer | With Gray deposition | Non-party; CPLR 3101(a)(4) subpoena required |
| Depose Goldberg | Last | Confront with Gray/Schaefer testimony and forensic accountant findings |
| Preservation letter | Immediately | Remind Defendant of obligation to preserve all financial records and accounting system data |
| Follow-up motion to compel | If demands not satisfied within 20 days | CPLR 3124 |
This document is prepared as a litigation support tool for Plaintiff's counsel. It is based on analysis of financial documents already produced in discovery and information provided by the Plaintiff. All figures should be verified by a retained forensic accountant. This document is protected by the attorney work product doctrine.