Status: Draft settlement demand letter. Not for transmittal until reviewed and finalized by Richard Litman's counsel of record. All factual assertions should be verified against source exhibits in evidence/freedom_bank_wires_20250722/, output/FREEDOM_BANK_WIRES_EXTRACTED.md, and output/FEDERAL_COMPLAINT_EXHIBITS_ANALYSIS.md before sending.
CORRECTION NOTE — 2026-05-01 (Re-Tag of "Litman 4/11/2026" Citation)
Scope: § 4 ("The October 8, 2025 payment — the first quarterly, not an anomaly") cites a 4/11/2026 clarification from Mr. Litman. That clarification is oral, not a written communication. It was contemporaneously memorialized in
output/MEMO_FOR_UNCLE_2026-04-11.md; no email, letter, or text dated 4/11/2026 exists in the corpus.Action before transmittal: Counsel should remove or refine the "(4/11/2026)" parenthetical to either (a) "per oral discussion with our client on 4/11/2026," or (b) reframe based on Litman's 1/12/2026 written email demanding the quarterly report (
evidence/gould_hurley_emails/Litman v Goldberg - quarterly report.eml.eml) and Gould's 1/15/2026 reply confirming "payments are quarterly per the agreement" — both of which are written and verifiable. The 1/12 + 1/15 email pair is a stronger evidentiary anchor for opposing-counsel correspondence than the oral 4/11 clarification.Original parenthetical preserved inline as a footnote.
Cite for verification:
output/VERIFY_CADENCE_CHANGE_2026-05-01.md§ I, § II, § III; logged inoutput/RETAGGED_4-11-2026_CITES_2026-05-01.md.
[LETTERHEAD]
April 10, 2026
VIA EMAIL AND FIRST-CLASS MAIL
Aaron Gould, Esq. Connell Foley LLP [Address]
Re: Litman v. Goldberg, Index No. 524343/2025 Supreme Court of the State of New York, County of Kings Settlement Discussion — Privileged & Confidential — FRE 408 / CPLR 4547
Dear Mr. Gould:
I write in furtherance of our prior settlement correspondence and in light of material new evidence that substantially alters the litigation calculus in this matter. The purpose of this letter is to place your client on notice of that evidence, to reset the settlement range accordingly, and to propose a defined thirty-day window within which the parties may attempt to resolve this dispute before the next round of motion practice and disciplinary filings.
As you know, Mr. Litman's fifth, sixth, and seventh demand letters — transmitted in the weeks preceding the July 21, 2025 filings — anchored the outstanding principal owed at $2,599,640.05 and requested a $1,000,000 good-faith wire by July 1, 2025 as a gesture of bona fides while the parties continued to negotiate. That wire was never received. No substantive response was provided. On July 21, 2025, and in direct response to that silence, Mr. Litman filed both the state action captioned above and the federal action Litman v. Nath, No. 1:25-cv-04048 (E.D.N.Y.), under the Lanham Act and pendent state-law theories.
In the nine months since those filings, discovery has produced — and independent forensic work has uncovered — evidence that transforms this case from a fee-recovery dispute into a documented pattern of post-litigation evidence destruction, trust-account misconduct, and willful misappropriation under N.Y. Civil Rights Law §§ 50-51. The principal new development, and the reason I write now, concerns an undisclosed Freedom Bank of Virginia trust account.
Recent forensic investigation has established that Nath, Goldberg & Meyer maintained a trust account at Freedom Bank of Virginia, account number 220001028, which was never disclosed to Mr. Litman in any accounting, never reflected in any NGM practice-management system accessible to him, and never included in the Schaefer/Kren accounting report attached as Exhibit A to the federal complaint. The account was also never produced in discovery in this matter.
The omission is not inadvertent. The CPA who prepared Exhibit A — Deborah J. Schaefer — had been affirmatively notified of the Freedom Bank account by Mr. Litman beginning in August 2023. The account nevertheless does not appear in her report.
On February 9, 2024, Mr. Litman sent Mr. Goldberg a written request that the Freedom Bank trust account(s) be closed or, in the alternative, that Mr. Litman's name be removed from them. The operative language was unambiguous: "I would appreciate you closing them or removing my name." Mr. Goldberg did not respond. No closure occurred. No name change occurred. The account remained open, under NGM's control, with Mr. Litman's name intact, for seventeen months.
Mr. Litman told Mr. Goldberg in writing on June 13, 2025 — forty-five days before the eventual closure and thirteen days before the June 26, 2025 litigation trigger — verbatim:
"PS. Each bank has a number in your system so you should be able to determine any money remaining in trust at Freedom."
That single sentence, preserved in Mr. Litman's iCloud text-message archive as exhibit IMG_1249 (mirror filename IMG_0722), forecloses any defense premised on "we did not know where the Freedom Bank account was" or "we could not locate it in our books." Mr. Litman told Mr. Goldberg — in plain English, and in advance of the closure — that NGM's own practice-management system (Soluno) contained a numeric identifier keyed to the Freedom Bank account and that Mr. Goldberg could identify and reconcile the balance with a single query. The plural phrasing — "each bank has a number" — independently confirms multiple Freedom Bank accounts. NGM's internal Trust Register Report, generated nineteen days later by NGM's own bookkeeper MaryJane Harper and discussed in Section 2.3 below, contains precisely that indexed line item ("t20 – Freedom Trust_1028 $24,495.15") — so Mr. Litman was not merely correct about what was in Mr. Goldberg's system; he was correct to the penny.
Mr. Goldberg's response to Mr. Litman's June 13, 2025 message did not address Freedom Bank at all. At 10:12:30 the same day he wrote only: "Martha assigns 4 series." That answer has no bearing on how much trust money remained at Freedom Bank, and it does not purport to dispute any premise of Mr. Litman's message. It is a deflection. Mr. Litman's immediate follow-up — "Agreed about Freedom, we know how much is there, the question is what the funds are for" — forced Mr. Goldberg back to the Freedom Bank topic and elicited the admission, quoted in Section 2.3 below, that anchors our spoliation claim. The full exchange is preserved as iCloud exhibit IMG_1250 (mirror filename IMG_0723).
The evidentiary significance of this June 13, 2025 exchange is that it converts the Freedom Bank knowledge element from inference to direct documentary proof. Mr. Goldberg was told in writing, in his own firm's system, where to find the Freedom Bank balance; he deflected; when pressed, he admitted the balance was known; forty-five days later, the account was swept to zero in the exact amount of that balance and closed the following week.
Separately, and earlier in time, Mr. Litman's August 17–18, 2023 text thread to Mr. Goldberg — iCloud exhibit IMG_1168 (mirror filename IMG_0697) — contains not only the already-known disclosure "there is money in two trust accounts at freedom bank," but the immediately following message, in the same continuous thread, on the same day: "I have a CLE on Thursday on what we need to do with notifying clients." The two messages appear together. Read together, they establish that Mr. Litman's Freedom Bank disclosure was made in immediate conjunction with his stated intent to notify affected clients — a client-notification effort that NGM thereafter blocked on five separate occasions over four years. The Freedom Bank concealment and the blocked client notification are not two independent facts; they were disclosed to Mr. Goldberg in one breath in August 2023 and were continuously suppressed together through July 28, 2025.
NGM's own internal Trust Register Report, printed in June 2025 by MaryJane Harper, reflects a closing balance on account 220001028 of exactly $24,495.15 as of June 30, 2025. The same report shows the account active, in NGM's custody, and bearing a specific dollar balance — yet this account is entirely absent from the Schaefer/Kren Exhibit A covering the same reporting period.
The state and federal complaints were filed on July 21, 2025.
One day later — on July 22, 2025, at 12:55 p.m. Central time — NGM caused a wire transfer of exactly $24,495.15 to be initiated from Freedom Bank account 220001028 to "Nath and Associates" at Bank of America, New York. The amount matches the June 30, 2025 closing balance to the penny. The transaction is memorialized under wire sequence number 78568, with OMAD 20250722B6B7HU3R00991707221354FT03 and IMAD 20250722GMQFMP01017268. The wire was received and notified by Freedom Bank in real time.
The memorandum field on the wire, as entered by NGM, reads — verbatim — "NGM Bank to Bank transfer Close Account." Those are not my words. They are the words your client entered into the wire-instruction form.
Freedom Bank's standard wire-notification email was delivered to litman@4patent.com at 12:55 CDT on July 22, 2025. That is the very email account NGM had eliminated, without notice or consent, four days earlier, on July 18, 2025 — in breach of Section 3 of the 2017 Amendment's royalty-free license. Either NGM expected the notification to bounce into the void and leave no trace, or the July 18 "elimination" was incomplete. Either explanation is damaging; the first goes directly to intent.
Six separate Bates-numbered copies of the notification were nevertheless preserved through NGM's own tenant-side retention (C2051472_ND0000071721, 071722, 071984, 071985, 115441, 115442). Your client's attempt to suppress the notification failed. The wire is documented.
The representation that Mr. Litman's @4patent.com and @nathlaw.com email accounts were "eliminated" on July 18, 2025 is now known to be false. That falsity is not established by Mr. Litman's testimony or by reconstruction — it is established by your client's own document production (Bates prefix ND0001), which contains, on its face:
The latest produced message is dated December 31, 2025 — more than five months and thirteen days after the alleged elimination. The produced corpus includes Microsoft 365 quarantine notices, which are generated only by a live, provisioned mailbox running against an active exchange policy. A deleted mailbox does not generate quarantine notices. Their presence in the production proves, as a matter of Microsoft infrastructure, that the mailboxes remained operational, provisioned, and actively processing inbound mail throughout the period Mr. Goldberg represented them as "down."
What Mr. Goldberg eliminated was Mr. Litman's access to the mailboxes. The mailboxes themselves remained live, continued to receive client email, continued to receive USPTO correspondence, continued to receive the six Freedom Bank closure confirmations on July 22, 2025 — and, critically, remained under Mr. Goldberg's administrative control throughout. He was watching the incoming mail on the very accounts he represented to Mr. Litman as eliminated.
The prior representation — whether made by your client or through counsel — that Mr. Litman's access was "never revoked" is impossible to reconcile with the documented July 21, 2025 text exchange in which Mr. Litman asks "Any update on email accounts?" and Mr. Goldberg responds "Let me find out from IT what happened." And the corresponding representation that the accounts were "eliminated" is impossible to reconcile with 8,024 produced messages. One or the other must give. The documentary record leaves only one coherent reading: Mr. Goldberg cut off Mr. Litman's access while keeping the mailboxes running, so that he could continue operating under Mr. Litman's email identity and monitor the inbound mail addressed to Mr. Litman at those addresses.
This finding independently and materially increases the egregiousness factor for punitive damages. It also converts the prior elimination representation into an affirmative misrepresentation made during the pendency of litigation — a fraud-on-the-Court predicate that will travel with your client through the remainder of this case and into the USPTO OED, Virginia State Bar, and District of Columbia Bar grievance forums.
On or about July 28, 2025, the Freedom Bank account was fully closed. Mr. Litman is prepared to attest to the closure date.
The concealment is made materially more egregious by a fact your client indisputably knew and has never acknowledged: Mr. Litman was a Director of Freedom Bank of Virginia, and served for a period as Chairman of the Bank's Executive Loan Committee (which met weekly). He also served on the Bank's Strategic Planning Committee and Corporate Governance Committee. That service is memorialized in an internal Freedom Bank "Director Committees" organizational document dated August 20, 2013, two independent photographs of which are in Mr. Litman's contemporaneous evidence archive. His service on the Board of Directors is also the basis for the statement, appearing in Mr. Litman's nathlaw.com professional biography for years, that he "served for over a decade as chairman of the board of a local bank." That "local bank" — as your client has always known — is Freedom Bank of Virginia.
The Plaintiff-Director-at-Freedom-Bank fact is not color; it is substance. It materially aggravates the case in three respects that bear directly on settlement value:
The trust accounts existed because of Mr. Litman. On information and belief, the undisclosed NGM trust accounts at Freedom Bank were opened through Mr. Litman's personal banking relationships as a Director — meaning the institutional relationship exists because of Mr. Litman, not in spite of him. That fact alone is inconsistent with any "these are NGM's own accounts" defense your client may be tempted to run.
Mr. Goldberg knew. Mr. Litman's service on the Board was disclosed publicly through the nathlaw.com biography for the entire period during which the trust accounts were maintained. Mr. Goldberg was the managing member of the very firm hosting that biography. No plausible construction of the record has your client unaware that the person whose name was on the door of his firm was also sitting on the Board of the host bank where he was quietly running undisclosed trust accounts.
The concealment was personal. Mr. Goldberg was not concealing accounts at an arbitrary bank. He was concealing NGM-administered trust accounts from a named Director of the very bank where those accounts sat. And he was closing them one week after being sued — at a bank where the plaintiff had personally chaired the Executive Loan Committee. There is no "routine bookkeeping" reading of that conduct. The Plaintiff-Director-at-Freedom-Bank fact converts the closure from an institutional concealment into a personal, knowing, director-to-director betrayal, and places the scienter element of Civil Rights Law § 51 at its strongest setting.
The egregiousness factor for punitive damages under Civil Rights Law § 51 — which authorizes exemplary damages for "knowing" use — has been substantially increased by this finding. A settlement range that does not account for the Plaintiff-Director-at-Freedom-Bank overlay understates your client's exposure.
The foregoing sequence is not a technicality. It is a textbook spoliation record and a textbook set of trust-accounting violations:
Spoliation of evidence. NGM had a duty to preserve the Freedom Bank account records the moment litigation became reasonably foreseeable — certainly no later than the July 21, 2025 filings, and arguably as early as Mr. Litman's June 26, 2025 written litigation notice. The account was swept and closed within the week. Under New York law, this supports an adverse-inference instruction at trial. Pegasus Aviation I, Inc. v. Varig Logistica S.A., 26 N.Y.3d 543 (2015).
Per se trust-accounting violations. Sweeping funds from a trust account styled in part under Mr. Litman's name to an operating account at a related entity, and then closing the trust account six days later, violates — independently — Virginia RPC 1.15, D.C. RPC 1.15, and the USPTO's analogue at 37 C.F.R. § 11.115. Because your client is admitted in the District of Columbia and the Commonwealth of Virginia (not New York), and because NGM is a District of Columbia professional limited liability company, the relevant disciplinary forums are the USPTO Office of Enrollment and Discipline, the Virginia State Bar, and the District of Columbia Bar. Grievance drafts in each of these three forums are prepared and are ready to file.
Consciousness of guilt — punitive multiplier. The seventeen-month delay followed by a one-day-after-suit sweep, under a memo that literally contains the words "Close Account," is party-admission evidence of intent. N.Y. Civil Rights Law § 51 expressly authorizes exemplary damages for any "knowing" use — the Freedom Bank sequence independently satisfies the scienter element.
Personal liability of Mr. Goldberg. Your client is the responsible attorney on the trust account, the signatory on the Nunc Pro Tunc Assignment that forms the basis of the § 51 case, and the individual named by the arbitrator as having "directed substantial firm operations . . . from his residence in Brooklyn." Judge Maslow's December 5, 2025 oral decision — which your co-counsel Mr. Gould conceded — already pierces the LLC veil under LLC Law § 609 and Turane v. MGN, LLC, 171 A.D.3d 835 (2d Dep't 2019), for personal participation liability. The Freedom Bank wire is another act of personal participation.
The Freedom Bank sweep was not the first post-litigation-threat act; it was preceded by a deliberate and documented termination of every regular payment NGM had been making to Mr. Litman for the prior sixteen months.
Sixteen months of regular payments. From April 2024 through May 21, 2025, NGM made regular monthly wire-transfer payments into Mr. Litman's personal Fidelity brokerage account, number 645375268. The total visible across this period is approximately $1,022,944.98 across sixteen transactions.
The payment shape. Monthly amounts ran from $16,469.11 to $29,322.80, punctuated by periodic quarterly spikes: $156,010.60 in April 2024, $257,119.76 in November 2024, $149,031.80 in December 2024, and $89,239.90 in April 2025. The baseline-plus-spike pattern is consistent with the "$25,000/month W-2 advance" Mr. Goldberg committed to in writing in March 2021 (Exhibit L to the federal complaint), with true-ups keyed to quarterly receipts.
The sudden stop. After the May 21, 2025 payment, NGM made no further payments to Mr. Litman. There was no June 2025 payment. No July 2025 payment. No August 2025 payment. No September 2025 payment. The sixteen-month cadence simply ceased.
The timing. The cutoff occurred precisely as Mr. Litman's June 26, 2025 demands escalated to the litigation threat — "that is the answer that gets you into litigation" — and continued uninterrupted through the July 21, 2025 filings and well beyond.
The October 8, 2025 payment — the first quarterly, not an anomaly. A single wire of $135,947.69 was transmitted on October 8, 2025 — three months after suit was filed. Mr. Litman has now clarified (per oral statement 4/11/2026, memorialized in our internal memo MEMO_FOR_UNCLE_2026-04-11.md; the position is also corroborated by Mr. Gould's own 1/15/2026 written email — "The payments are quarterly per the agreement. We had that discussion already…") that this October 8 wire is the first quarterly payment under a unilateral change in payment cadence imposed by your client after the lawsuits were filed.[^4-11-orig]
[^4-11-orig]: Original phrasing (corrected 2026-05-01): "Mr. Litman has now clarified (4/11/2026)…" — implied a 4/11/2026 written communication. There is no such written artifact; the clarification was oral. See Correction Note at top. NGM did not stop calculating the 20% formula — it stopped paying monthly and switched (without notice or consent) to a quarterly cadence. The $135,947.69 is Mr. Litman's 20% share for Q3 2025 (July–September 2025) collections, which implies total NGM-collected Litman-originated revenue for the quarter of approximately $679,738. The legal significance is threefold: (i) NGM continued collecting fees on Mr. Litman's matters after suit was filed — it did not stop running the formula, it merely slowed the payouts; (ii) the unilateral change from monthly to quarterly cadence is itself a breach of Mr. Goldberg's March 2021 written commitment to a "$25,000/month W-2 advance" (Exhibit L to the federal complaint), imposed without any notice to or consent from Mr. Litman; and (iii) under the quarterly cadence your client unilaterally imposed, a Q4 2025 quarterly payment should have arrived on or about January 2026 and a Q1 2026 quarterly payment should have arrived on or about April 2026. Neither has been received. Those two quarterly payments — each representing an additional ~$120K–$200K owed at a minimum — are a live, ongoing, continuing breach that has accrued since the filing of these lawsuits. Far from weakening Mr. Litman's position, the October 8 quarterly payment strengthens it: it establishes, on bank-transaction evidence, that the 20% formula remained operational and that NGM was in continuous possession of substantial amounts properly belonging to Mr. Litman at all times from June 2025 forward. We will be asking your client under oath at his deposition who authorized the cadence change, when, whether Mr. Litman was notified, whether he consented, and where the Q4 2025 and Q1 2026 quarterly payments are.
The evidentiary significance of the payment cutoff is three-fold. First, the pre-May 21 record confirms — on bank-transaction evidence rather than on reconstruction — that NGM was in fact paying Mr. Litman pursuant to an ongoing compensation arrangement through mid-2025; any defense that no such arrangement existed, or that it had lapsed, is foreclosed by NGM's own wires. Second, the sudden termination of that arrangement immediately upon the litigation threat is itself a party admission — the retaliatory and coordinated character of the July 18 email cutoff, the July 22 Freedom Bank sweep, and the August concealment pattern is corroborated by the June payment stop. Third, the $3,276,440.61 "paid" figure that appears in prior demand correspondence can now be partially verified, line by line, against the Fidelity transaction record, closing off any attempt to dispute it on the ground of recordkeeping opacity. The continued non-payment from June 2025 forward is itself an ongoing breach, accruing additional damages with every month that passes.
The Freedom Bank wire does not stand alone. It is one act in a documented sequence of coordinated post-litigation-threat conduct by the same responsible partner, all by the same responsible partner, all tending to suppress or destroy records relevant to this action, or to retaliate against Mr. Litman for asserting his rights:
Five discrete acts, within roughly sixty days, each post-dating the litigation trigger, each by the same responsible partner, each tending either to retaliate against Mr. Litman, to suppress or destroy records relevant to this action, or both. No one of these acts is susceptible of an innocent explanation on its own; taken together, they describe a campaign.
The Freedom Bank discovery is dispositive on its own terms. It does not, however, exist in isolation. I remind you of the following items already in the record:
Prior correspondence anchored the outstanding principal at $2,599,640.05. That figure remains the defensible floor for contract damages, and I note that it is conservative relative to both (a) NGM's own defendant-produced 22-month and 24-month receivables totals of $2,108,387 and $2,412,428 respectively, and (b) Mr. Litman's $2,403,125.66 reconstructed total, which cross-checks the NGM-produced numbers to within 0.4%. The $3,276,440.61 "paid" figure cited in prior demand letters can now be partially verified, transaction by transaction, against the Fidelity record described in Section 4 — and the continuing non-payment from June 2025 forward is itself an ongoing breach that accrues additional damages month over month.
For the reasons set forth above, the Freedom Bank discovery materially increases the expected value of this case along four independent axes:
Two recent findings — the email-elimination fraud documented in Section 2.5A (8,024+ inbound emails to "eliminated" accounts post-7/18/2025, proving the accounts remained live and under Mr. Goldberg's administrative control) and the Plaintiff-Director-at-Freedom-Bank finding documented in Section 2.7 (Mr. Litman as Chairman of the Executive Loan Committee of the very bank where Mr. Goldberg concealed, operated, and then closed the undisclosed trust accounts) — materially increase the egregiousness factor and, with it, the settlement range. The email-elimination finding converts a representation made during pendency of the litigation into an affirmative misrepresentation; the Freedom Bank director finding converts an institutional concealment into a personal, director-to-director betrayal. Each, independently, takes the punitive exposure under Civil Rights Law § 51 to its highest setting.
Taking all of the foregoing into account, the revised settlement range on this matter is:
$7,000,000 to $15,000,000
Position within the range will depend on timing. Earlier resolution yields a lower number. Specifically:
These brackets are anchored conservatively against the documented compensatory damages, the disgorgement exposure under Murray v. Beard, and the statutory punitive exposure under Civil Rights Law § 51, as now aggravated by the email-elimination-fraud and Plaintiff-Director findings. They do not assume any additional evidence that may be adduced through the outstanding bank subpoenas or the Goldberg deposition.
I propose the following:
A thirty-day settlement window from the date of this letter, during which the parties engage in good-faith negotiation — either directly or through a mutually acceptable mediator — with a view to resolving the state and federal actions and all related disciplinary exposure.
Immediate preservation orders from your client, in writing, confirming: a. that all records associated with Freedom Bank account 220001028 — statements, wire orders, signature cards, authorized-signer documents, monthly reconciliations, and internal correspondence — have been preserved and will not be destroyed, altered, or transferred; b. that no additional NGM trust or operating accounts have been closed, transferred, or scheduled for closure since July 21, 2025, and none will be without prior written notice to Mr. Litman; and c. that NGM will not further alter, disable, or redirect any email account, alias, or domain bearing Mr. Litman's name pending resolution of this matter.
Engagement of a court-appointed or mutually agreed neutral CPA to conduct a forensic reconciliation of NGM's trust and operating accounts for the period January 2020 through the present, with full access to the Freedom Bank records, the Bank of America trust account (003926278751), the missing August and September 2025 Payment Allocation Reports, and the underlying Soluno/Devlos practice-management exports.
If these three items cannot be confirmed in writing within fourteen days, I will understand that the parties are not in a position to settle within the thirty-day window, and Mr. Litman will proceed with (a) the spoliation motion currently in draft; (b) the three disciplinary filings; and (c) a subpoena directly to Freedom Bank of Virginia for the underlying SWIFT/Fedwire records, complete statement history of account 220001028, and any additional wires dated July 21, 2025 through July 28, 2025.
Mr. Litman remains open to dialogue. He has been open to dialogue for several years. The purpose of this letter is not to threaten, and I have written it in that spirit; the purpose is to place your client on notice that the evidentiary record has grown materially since our last settlement exchange, and that a window still exists — but a narrowing one — to resolve this matter on terms materially below where it will sit if the Freedom Bank discovery is litigated on the papers.
I would appreciate a response within seven days confirming either (a) willingness to engage in a thirty-day negotiation window on the terms described in Section 8, or (b) that your client declines to do so, in which case we will proceed accordingly.
All rights, remedies, claims, and defenses are expressly reserved. This letter is transmitted for settlement purposes only, is confidential, and is inadmissible at trial under Federal Rule of Evidence 408 and CPLR 4547.
Respectfully,
[Counsel of record for Richard C. Litman]
cc: Richard C. Litman
FREEDOM_BANK_WIRES_EXTRACTED.md, (b) the February 9, 2024 closure-request email, (c) the MaryJane Harper Trust Register excerpt showing the $24,495.15 balance, and (d) the relevant page of the Schaefer/Kren Exhibit A showing the omission.