After agreeing in writing not to pursue $50,000 in attorney fees through a lien on a client’s property, Josephine Townsend — candidate for Clark County prosecutor — did the opposite, public records show.
Townsend, who agreed to give up the lien as a part of her client’s plea deal, said prosecutors didn’t have the right to keep her from using that lien to collect on unpaid attorney fees.
Fred Engh, 31, hired Townsend in May 2013 to defend him against dozens of charges related to operating a multistate retail theft crime ring in which he reportedly sold more than $700,000 in fraudulently obtained gift cards.
In order to pay Townsend, Engh signed a promissory note to Townsend Law for $50,000 on May 17, 2013, and a deed of trust on Engh’s Vancouver home, which was recorded May 30, 2013, Townsend wrote in court documents. The house has a taxable assessed value of nearly $150,000, according to county property records.
A few days later, the civil division of the Prosecuting Attorney’s Office, which operates out of a separate office from the criminal division, filed a complaint in Superior Court on May 21, 2013, seeking to forfeit all of Engh’s interest in the property to the state because, according to the county, Engh had knowingly acquired the property with proceeds from money laundering and organized crime. Clark County sheriff’s deputies seized the property that same day.
About a year later, Townsend and Deputy Prosecutor Michelle Nisle began final negotiations of a criminal settlement offer under which Engh would be required to plead guilty in exchange for reduced charges, according to email correspondence between the two attorneys.
Vancouver attorney Rachel Brooks requested the emails from the county for use in her blog, Josie Townsend Watch, which opposes Townsend’s election as county prosecutor. She provided the emails to The Columbian at the newspaper’s request. Brooks, who worked for Townsend at the city of Vancouver, also filed a bar complaint against Townsend in 2005, for which Townsend was later disciplined.
In a June 18 email, Townsend asked that Engh receive no more than eight years in prison and that she receive $50,000 from her lien on the house.
“Because he wants to pay his attorney, he wants my lien of $50,000 released on the house and the remainder of the value of the house you can have,” Townsend wrote.
Nisle declined the counteroffer, citing sheriff’s detectives’ concern over the release of the $50,000.
The deputy prosecutor then made a counteroffer, which included nine years in prison but no agreement on the financial issues related to Engh’s house.
Townsend replied on June 22 that Engh would agree to release his interest in his house, and she would no longer pursue the lien on the house.
“He gives up the house, and I will release my lien,” Townsend wrote.
Nisle agreed to the new terms and agreed to recommend a sentence of eight years.
Engh pleaded guilty July 3 to reduced charges of leading organized crime, money laundering and bail jumping. Nisle recommended a sentence of eight years, but Judge Suzan Clark gave him 10 years, citing what she said was his lack of remorse. As part of his sentence, Engh was required to forfeit all of his assets, including the $150,000 house, about $100,000 in cash and other personal property.
In exchange for Engh’s guilty plea, Nisle dismissed dozens of other charges, including money laundering and trafficking in stolen property.
Reversal of position
Two weeks later, Townsend filed a motion to intervene in the county’s civil case that sought forfeiture of Engh’s interest in the house. In the motion, she claimed that she was entitled to $50,000 of the value of the house because the promissory note predated the plea agreement.
“The only interest that Mr. Engh could transfer … as part of his plea arrangement was his remaining interest in the home after the $50,000 encumbrance had been paid,” Townsend wrote in the motion.
Civil Deputy Prosecutor Bill Richardson, who was handling the civil case, confronted Townsend in an email about the motion.
“In your June 22, 2014, email, there seems to be a clear indication that you offered to give up your potential lien on the house,” Richardson wrote. “After the signing of the plea agreement, Michelle Nisle clearly told me that you had given up your potential lien on the house. … please, let me know if this discussion changes your mind regarding further pursuit of the lien.”
“Well, I put it in an email, and I see that now, so I have to abide by it,” Townsend replied.
Superior Court Judge David Gregerson signed off Aug. 22 on a stipulated judgement in which both parties agreed that Engh’s property should be forfeited to the state.
The proceeds from sale of the property will be placed in an account used by the Clark County Sheriff’s Office for law enforcement equipment expenditures, Richardson said.
Townsend now says that the criminal settlement could not require her to give up her lien.
“Despite this, the prosecutor’s office demanded that not only did Mr. Engh give up his lien, but that I basically give up my right to collect on attorney fees,” Townsend said in an email to The Columbian. “That was not part of any pretrial offer entered in the case. … It only speaks to Mr. Engh’s giving up his lien.”
The settlement offer filed in court says that Engh is required to “forfeit all property seized as evidence in the case and all property pending forfeiture hearings that have not already been resolved.”
“If you read the pretrial agreement, you will see that specifically, it only requires Mr. Engh to give up his rights to the property, but the prosecutor’s office stated that if I did not give up my personal lien on the property, that Mr. Engh would have to do a minimum of at least two more years in prison,” Townsend said. “That was not put in writing, but was the topic of phone discussions with the prosecutor’s office.
“The prosecutor’s office acted improperly and created a conflict for me — either I give up my lien, and my client gives up his lien, or my client would have to do two more years in prison.”
Prosecutor Tony Golik said that if Townsend thought his office acted improperly, she could have complained to the judge in the case.
“She could have brought a motion to the court, and she did not,” Golik told The Columbian. “We did not do anything wrong in this case. This is the first time I have heard her make this claim when her conduct is being examined by you. I think the trail of emails speak for themselves in this case.”
Engh was the ringleader of a network of shoplifters who stole merchandise and then returned it for store credit on a gift card, according to court documents. The shoplifters, often called “boosters,” then sold the gift cards to Engh for 40 to 75 percent of their value, and he resold the gift cards online, according to court documents.
The crime ring operated for at least three years in Washington, Oregon and Nevada, officials say.
Investigators said he sold more than $700,000 in fraudulently obtained gift cards during that period.
