Case: Litman v. Goldberg, Index No. 524343/2025 Court: Supreme Court of the State of New York, Kings County Judge: Hon. Brian L. Gotlieb, J.S.C. Surviving Claim: Count V -- NY Civil Rights Law Sections 50-51 (Misappropriation of Name) Prepared: April 4, 2026 Classification: Attorney Work Product / Privileged
Account 36372 was the umbrella trust account for King Faisal University ("KFU"), one of the largest clients originated by Richard Litman. Between September 30, 2020 and November 20, 2024, a total of $10,737,709.88 flowed into this single account across 871 transactions. Litman was entitled to 20% of collected fees on KFU matters under both the Combination Agreement and the arbitration award.
The structure of Account 36372 suppressed Litman's allocation in three ways:
KFU wire payments were deposited into umbrella account 36372 rather than into the specific patent docket accounts (e.g., 33110.89U, 33101.05U) where the work was performed. This gave Goldberg sole discretion over when and how money was allocated to individual matters -- and therefore when Litman's 20% was triggered.
86 lump-sum transfers to operating totaling $8,617,811.01 moved money out of trust with almost no invoice references. Of these 86 transfers, only 3 contained any invoice reference. The remaining 83 were described simply as "Transfer to Operating" -- providing no audit trail connecting the disbursement to specific client work.
375 inter-docket transfers totaling $2,016,672.00 moved money within the trust system. Every one of these transfers listed the counterparty as "Nath Goldberg & Meyer, in trust" -- the firm's name, not the client's. Money was shuffled between sub-dockets at Goldberg's direction, further obscuring the connection between KFU payments and Litman-originated work.
The result: despite $10.84 million flowing through Account 36372, Goldberg's own workup reported $0 in KFU revenue. Zero. Litman's 20% was calculated on a number that excluded the firm's single largest client.
As of November 20, 2024, $84,231.87 remains frozen in Account 36372 -- money generated under Litman's name that has never been disbursed or allocated.
KFU paid NGM by international wire transfer, typically in large lump sums covering multiple patent matters at once. These wires were deposited into umbrella account 36372, designated as the general KFU trust docket, rather than into the specific patent prosecution sub-accounts where the work was performed.
Over the life of the account, 38 external deposits totaling $12,202,568.99 were received. Of these, 32 were wire transfers totaling $10,843,901.60. The largest single wire was $936,422.00 on May 10, 2023, described as "Wire Payment/Retainer Multiple invoices King Faisal University." Other major wires include:
| Date | Amount | Description |
|---|---|---|
| April 4, 2024 | $659,772.00 | Wire Payment / Retainer KFU 135900 / 36372 |
| February 13, 2024 | $648,374.00 | Payment / Retainer Wire King Faisal University 36372 |
| February 21, 2024 | $597,666.00 | Wire Payment/Retainer KFU 135900/36372 |
| February 29, 2024 | $597,130.00 | Wire Payment / Retainer KFU 135900 36372 |
| December 19, 2023 | $595,838.00 | Wire KFU Payment / Retainer 36372 |
| September 14, 2023 | $593,610.00 | Wire Payment / Retainer KFU 36372 |
| December 26, 2023 | $583,262.00 | Wire Payment / Retainer King Faisal University 36372 |
| June 15, 2023 | $523,144.00 | Wire Retainer Multiple Dockets King Faisal University |
None of these deposits were allocated to specific patent dockets upon receipt. They sat in 36372 as undifferentiated lump sums until Goldberg directed their distribution.
Money exited Account 36372 through two channels, and both were controlled by Goldberg:
Channel 1: Lump-Sum Transfers to Operating (86 transfers, $8,617,811.01)
These transfers moved money from the KFU trust account directly into the firm's operating account at "Nath & Associates PLLC." Litman's 20% allocation was driven by trust-to-operating transfers -- meaning if the transfer was delayed, Litman's credit was delayed. If the transfer was made without invoice references, there was no way to verify that the correct amount was transferred for the correct work.
Of the 86 lump-sum operating transfers: - Only 3 contained any invoice reference - 83 were described simply as "Transfer to Operating" -- no client matter number, no invoice number, no explanation of what work the payment covered
The pattern intensified dramatically over time:
| Year | Operating Transfers | Total Amount |
|---|---|---|
| 2020 | 0 (2 general disbursements) | $110,760.00 |
| 2021 | 3 | $155,925.14 |
| 2022 | 11 | $499,315.00 |
| 2023 | 27 | $2,790,594.00 |
| 2024 | 42 | $5,077,616.87 |
In 2024 alone, 42 transfers moved over $5 million from trust to operating -- an average of nearly $121,000 per transfer -- almost entirely without documentation tying the transfers to specific invoices.
Channel 2: Inter-Docket Transfers (375 transfers, $2,016,672.00)
These transfers moved money within the trust system from the umbrella 36372 account to individual patent prosecution sub-dockets (e.g., 32087.28, 33101.05U, 33110.89U). Every one of these 375 transfers listed the counterparty as:
"Nath Goldberg & Meyer, in trust"
This is the firm's name -- not King Faisal University, not the patent applicant, not the client. Under trust accounting rules, client funds should be held in the client's name. The use of the firm's name as counterparty on all 375 inter-docket transfers means the trust records identify these funds as belonging to the firm rather than to the client whose money it was.
Because Litman's 20% was calculated based on trust-to-operating transfers rather than on deposits received, the structure created a built-in delay mechanism:
This is precisely what happened. Invoice 405540 illustrates the pattern: KFU paid $11,840 on docket 33110.89U, which was credited on June 29, 2023. The trust ledger shows a $11,840 transfer on June 19, 2023 labeled "To: 33110.89U Patent Application 405540." But Litman's 20% allocation on this invoice was never applied. As Litman documented in his June 2025 email to Goldberg (ND264009): "Invoice 405540 (Docket 33101.97U): $11,440 - Paid, allocation missing."
This was not an isolated case. Litman identified multiple KFU dockets with the same problem: - Docket 33110.43U: Trust payment transferred to operating, but no 20% RCL credit applied - Docket 33110.63U: Trust payment received but NOT transferred to operating -- no credit issued at all - Docket 33110.92U: Trust payment made WITHOUT any invoice or transfer record - Dockets 33120.22S and 33120.26S: Trust transferred but no RCL credit
The trust ledger reveals that the firm's receiving entity changed names during the relevant period, without explanation:
| Entity Name | Used For | Period |
|---|---|---|
| Nath & Associates | Operating transfers | Early 2020 |
| Nath & Associates PLLC | Operating transfers | 2021 forward (83 transfers) |
| Nath & Associates, PLLC | Operating transfers | Sporadic |
| NATH, GOLDBERG & MEYER | Operating transfers | Single entry |
| Nath Goldberg & Meyer, in trust | Inter-docket transfers | All 375 TRF entries |
The entity receiving the operating transfers -- "Nath & Associates PLLC" -- is different from the entity listed on the inter-docket transfers -- "Nath Goldberg & Meyer, in trust." This means client trust funds flowed between accounts held under different entity names, none of which is the actual client (King Faisal University). The proliferation of entity names further complicates any independent audit of fund flows.
Invoice 405540 is a microcosm of the entire scheme:
The $2,400 difference between the trust deposit ($11,840) and the invoice amount ($9,440) was allocated to a related PTO Filing Fee invoice (319688, $2,400). The entire payment was processed, the work was completed, the patent issued -- all under Litman's name as attorney of record -- but Litman's 20% was never credited.
Litman identified at least three more KFU invoices with the same pattern: Invoice 405629, Invoice 405664, and others, totaling over $35,120 in missing allocations on KFU matters alone.
The trust ledger contains four entries dated August 19, 2021, each annotated with the notation "JBGverbal" -- identifying Joshua B. Goldberg as having verbally authorized the transfer:
| Entry No. | From Docket | To Account | Amount | Authorization |
|---|---|---|---|---|
| 2488679 | 32087.50 | 36372 | $298.00 | JBGverbal 8.18.2021 |
| 2488683 | 32087.14 | 36372 | $3,000.00 | JBGverbal 8.18.2021 |
| 2488688 | 32087.08 | 36372 | $1,100.00 | JBGverbal 8.18.2021 |
| 2488691 | 32087.19 | 36372 | $810.00 | JGBverbal 08.18.2021* |
*Entry 2488691 contains a typographical transposition ("JGB" instead of "JBG") but is clearly the same person -- all four transfers were executed on the same date, in sequential entry numbers, with the same authorization date.
Total moved by Goldberg's verbal command: $5,208.00.
The significance is not the dollar amount. It is the proof that Goldberg could pick up the phone, instruct accounting staff to move money between Litman's patent dockets, and the instruction was executed immediately. The trust accounting system recorded the identity of the authorizing individual -- "JBG" for Joshua B. Goldberg, "MSL" for Martha S. Long (a separate entry on January 31, 2023, confirms the notation system). Goldberg exercised personal, verbal, undocumented control over the movement of trust funds generated by work performed under Litman's name.
Deborah J. Schaefer, CPA -- NGM's external accountant, referred to Litman by Goldberg himself -- told Litman that trust accounts were being closed because the firm was "not supposed to have trust money for your own money."
This statement is an admission of awareness that the trust accounts contained firm funds rather than solely client funds. Under Virginia RPC 1.15 (the governing rule for NGM as a Virginia-organized firm) and New York Rule 1.15, the commingling of client trust funds with firm funds in a trust account is a per se violation.
On June 7, 2025, Litman emailed Goldberg, copying Schaefer (ND263924), identifying specific KFU dockets with trust irregularities:
"I've flagged King Faisal University dockets that require attention. These relate to payments received, invoice status, trust transfers, and uncredited 20% allocations."
He listed specific dockets (33110.43U, 33110.63U, 33110.92U) and noted: "There is significant money involved here."
On June 19, 2025, Litman sent Schaefer a draft memo summarizing the June 2023 KFU payments, copying Goldberg (ND264006):
"Here is a draft memo summarizing the June 2023 KFU payments. There are many matters for which I was not paid as described in the draft."
Goldberg was copied on both emails. He was on notice that Litman had identified missing allocations on KFU trust account payments. His response, when it came, was: "I need to figure out why" -- an acknowledgment that allocations were missing, without any corrective action.
On March 18, 2024, a $595,214 KFU wire payment was received into the Bank of America Wire_8751 account and transferred directly to the Bank of America Operating_2417 account -- bypassing the trust accounts entirely. Client trust funds went straight into the firm's operating account without passing through any trust account.
The wire was recorded in the Soluno accounting system as $594,214 -- exactly $1,000 less than the actual wire amount. A correction entry on March 19, 2024 documented the discrepancy:
"Correction: There was a wire transfer form [sic] the Bank of America Wire_8751 account to the Bank of America Operating_2417 account on March 18, 2024 for $595,214. The amount recorded in Soluno is $1,000 lower because it was recorded as $594,214."
The correction added the missing $1,000 to the ledger but did not address the fundamental problem: a client wire payment of nearly $600,000 was deposited directly into the firm's operating account, not into trust.
On April 9-10, 2024, $587,358.87 in KFU trust funds was routed through the operating account to transfer between banks:
A legitimate inter-bank transfer of trust funds should have been processed trust-to-trust. Routing through the operating account created temporary commingling of $587,358.87 in client trust funds with firm operating funds.
Every one of the 375 inter-docket transfers within Account 36372 lists the counterparty as:
"Nath Goldberg & Meyer, in trust"
This is the firm's name. Under trust accounting rules, client funds held in trust should be identified as belonging to the client -- in this case, King Faisal University. The consistent use of the firm's own name as the counterparty on intra-trust transfers means the trust records do not properly identify the beneficial owner of the funds.
Of 86 transfers from trust to operating, only 3 contained any invoice reference. Trust-to-operating transfers should be supported by documentation showing: - Which client matter the funds relate to - Which invoice was being paid - That the services were completed - That the transfer amount matches the earned fee
The absence of invoice references on 83 of 86 transfers means there is no contemporaneous record linking the vast majority of trust disbursements to specific earned fees. Without this documentation, it is impossible to verify that: - The correct amount was transferred for each matter - Litman's 20% was calculated on the correct base - The timing of transfers was driven by client billing rather than firm cash-flow needs
The trust ledger shows that large KFU wire payments sat in Account 36372 for extended periods before being transferred to operating:
While some processing delay is normal, the pattern of holding funds and then disbursing in lump sums without invoice references meant that Litman had no visibility into which payments had been received, which had been transferred, and whether his 20% had been applied.
Litman's emails documenting KFU trust irregularities were sent to Goldberg or copied to him:
| Date | Goldberg's Role | |
|---|---|---|
| February 9, 2024 | ND263559 -- Litman asks about Freedom Bank trust accounts | Direct recipient |
| June 7, 2025 | ND263924 -- Litman identifies KFU trust irregularities | Direct recipient (Schaefer CC'd) |
| June 19, 2025 | ND264006 -- Litman sends KFU payment analysis | CC'd (Schaefer primary) |
Goldberg cannot claim ignorance. He received contemporaneous written notice that Litman had identified missing allocations on KFU trust payments.
When Litman raised accounting concerns in August 2023, Goldberg did not address them directly. Instead, he referred Litman to Deborah Schaefer, the CPA. As Schaefer confirmed: "Josh did mention you wanted to chat." Goldberg interposed the CPA between himself and Litman's questions about trust account management, while maintaining personal control over the trust accounts themselves.
The four "JBGverbal" entries on August 19, 2021 prove that Goldberg personally directed trust fund movements by verbal instruction. The accounting system distinguished between individuals who authorized transfers -- "JBG" for Goldberg, "MSL" for Martha Long, "Per MSL" for Long's written authorization. Goldberg's verbal commands were recorded and executed. He was not a passive firm partner; he was the person who decided where KFU trust money went.
The "NGM Litman Workup" that Goldberg prepared to calculate Litman's 20% share reported $0 in revenue from King Faisal University. Zero. Despite $10,737,709.88 flowing through Account 36372, despite 86 transfers totaling $8.6 million to the firm's operating account, despite KFU being one of the firm's largest clients -- the workup showed nothing.
When confronted, Goldberg admitted the Soluno reports "drew its data from account ledgers that didn't include payments actually made." This is a direct admission that the accounting system he controlled was structurally deficient in a way that excluded KFU revenue from Litman's allocation calculation.
When Litman identified specific KFU invoices where his 20% had not been applied -- including Invoices 405540, 405629, and 405664, totaling over $35,120 -- Goldberg's response was: "I need to figure out why." He acknowledged the allocations were missing. He did not dispute the amounts. He did not offer immediate correction. And there is no record that the allocations were ever applied.
The 36372 structure is a primary mechanism through which the $16.2 million accounting gap was created:
| Metric | Goldberg's Workup | Trust Ledger (Actual) | Difference |
|---|---|---|---|
| Total client receipts | $16,506,604.92 | $32,708,669.08 | $16,202,064.16 |
| KFU revenue | $0.00 | $10,737,709.88 | $10,737,709.88 |
| KSU revenue | $0.00 | $3,720,000+ | $3,720,000+ |
| 20% due to Litman | $2,402,451.86 | $4,299,347.35 | $1,896,895.49 |
KFU alone accounts for $10.74 million of the $16.2 million gap -- 66.3% of the total discrepancy. The 36372 umbrella structure made this possible by routing all KFU payments through a single account that was excluded from the Soluno reports Goldberg used to calculate Litman's share.
At 20% of the $8,617,811.01 that was transferred from Account 36372 to operating, Litman was owed approximately $1,723,562.20 on KFU trust-to-operating transfers alone. The amount actually credited to him from KFU: unknown, but Goldberg's workup showed $0 in KFU revenue, implying that none of it was included in the 20% calculation.
In June 2025, Litman noted that his allocation had been reduced to approximately $20,000 per month ($240,000/year) despite massive revenue flowing through his originated client accounts. He stated that "7 figures" was owed -- over $1,000,000. Goldberg did not dispute this claim. His silence is an adoptive admission.
At 20% of collected fees, $1 million owed implies at least $5 million in collected fees. The trust ledger confirms that the firm collected far more than that from KFU alone. The gap between what Litman received and what he was owed is a direct financial consequence of the 36372 structure.
As of November 20, 2024 -- the date of the last transaction in the trust ledger -- Account 36372 holds a balance of $84,231.87.
This balance has been static since November 2024. It represents KFU client funds that: - Were received by the firm under Litman's name as attorney of record - Were deposited into the umbrella trust account - Were never transferred to operating - Were never allocated to specific patent matters - Have generated no 20% credit for Litman
The $84,231.87 is money earned under Litman's professional identity that sits in an account Goldberg controls, uncredited and undisbursed for over five months.
Account 36372 was not merely a bookkeeping convenience. It was the financial infrastructure through which $10.84 million in KFU client revenue -- all generated by patent work performed under Richard Litman's name -- was processed in a way that systematically excluded it from Litman's 20% allocation.
The scheme operated through three reinforcing mechanisms: 1. Deposits into the umbrella account rather than specific matter dockets, giving Goldberg sole discretion over allocation 2. Lump-sum transfers to operating without invoice references (83 of 86 transfers), destroying the audit trail 3. Inter-docket transfers under the firm's name rather than the client's, obscuring beneficial ownership
Goldberg personally authorized trust fund movements ("JBGverbal"), was copied on every email documenting the irregularities, admitted the accounting system "didn't include payments actually made," acknowledged missing allocations ("I need to figure out why"), and prepared a workup that reported $0 in KFU revenue despite $10.74 million flowing through the account.
The 36372 structure is not a rounding error. It is the mechanism by which the firm's single largest client was excluded from the calculation of Litman's compensation -- while Litman's name remained on every KFU patent filing, every filing receipt, every Notice of Allowance, and every issued patent.
| Document | Description |
|---|---|
| KFU Trust Ledger (Account 36372) | 871 transactions, Sept. 30, 2020 -- Nov. 20, 2024; generated June 19, 2025 by Deborah J. Schaefer |
| KFU 36372 Lump Sum Operating Transfers | 86 trust-to-operating transfers extracted from ledger |
| ND263924 (June 7, 2025) | Litman email to Goldberg CC Schaefer identifying KFU trust irregularities |
| ND264006 (June 19, 2025) | Litman KFU payment analysis to Schaefer CC Goldberg |
| ND263559 (February 9, 2024) | Litman email re Freedom Bank trust accounts |
| ND264009 / ND264010 | Litman emails identifying Invoice 405540 allocation gap |
| NGM Litman Workup | Goldberg's compensation calculation showing $0 KFU revenue |
| Quarterly Compensation Summary | Shows $4,299,347.35 due vs. $2,403,125.66 paid |
| Trust Account Summary (June 26, 2025) | Schaefer-produced report showing $32,708,669 total trust receipts |
This memo was prepared for counsel review in connection with Litman v. Goldberg, Index No. 524343/2025. All figures are drawn from financial documents produced in discovery and communications preserved in Richard Litman's email accounts. A forensic accountant should verify all figures before use in court filings.