EFTA00183736 13/2009 13:11 FAX # KIRKLAND & ELLIS LLP AND AFFILIATED PARTNERSHIPS Jay P. Lefkowitz, To Call Writer Directly: lefkowitz@kirkland.com Citigroup Center 153 East 53rd Street New York, New York 10022-4611 www.kirkland.com Facsimile: Confidential For Settlement Purposes Only Pursuant to Rule 408 February 13, 2009 VIA FACSIMILE Robert . Josefsberg, Esq. Podhurst Orseck, P.A. City National Bank Building 25 West Flagler Street, Suite 800 Miami, FL 33130 Dear Bob, We have received copies of your firm's invoices for the last several months as related your representation of a select group of individuals in connection with a matter between Mr. Epstein and the United States Attorney’s Office in the Southern District of Florida (the "USAO"). We write this letter to (1) address issues raised by those invoices and (2) suggest a resolution to this matter that would benefit all parties involved. First and foremost, after thoroughly reviewing the invoices from your firm, it is clear that the services you have provided to the women at issue far exceed the scope of services for which Mr. Epstein agreed to pay under the federal Deferred Prosecution Agreement (the “Agreement”) and Addendum. Pursuant to the relevant Agreement and Addendum, Mr. Epstein agreed to pay the attorney representative for his representation of a select group of individuals at “his or her regular customary hourly rate.” Importantly, the Addendum limits the scope of this representation and specifies that the Agreement “shall not obligate Epstein to pay the fees and costs of contested litigation filed against him.” The Addendum further provides that Mr. Epstein’s obligation to pay the fees of an attorney representative ceases when the work performed is aimed at pursuing “a contested lawsuit pursuant to 18 § 2255” or “any other contested remedy.” Simply put, the Agreement and Addendum only require Mr. Epstein to pay fees expended in connection with negotiating a settlement for each of the relevant individuals, not for services relating to any type of pre-litigation effort. Thus, any charges related to work performed beyond, or extraneous to, reaching a settlement should not be Mr. Epstein's responsibility. Mr. Epstein fully intends to fulfill his agreement and pay for all fees associated with settlement at your firm’s regular hourly rates. However, Mr. Epstein will not pay for any services beyond those directed towards reaching a settlement. To resolve this matter, we are
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EFTA00183737 02/13/2009 13:12 FAX ☑ 003/003 Confidential For Settlement Purposes Only Pursuant to Rule 408 Robert C Josefsberg February 13, 2009 Page 2 available and ready to discuss the invoices with you on a line-by-line basis and believe that we can come to an agreeable resolution as to the fees accumulated to date. During the same discussion, we hope to clarify with you the exact number of women who have agreed to utilize your services for the purpose of reaching a settlement with Mr. Epstein. Second, upon serious consideration and discussion, Mr. Epstein is prepared to offer your clients a settlement that we believe will serve to compensate each individual appropriately. As a final resolution to this matter, Mr. Epstein would pay each individual who agrees to relinquish any and all potential civil claims against him $50,000.00, which is the statutory amount provided by 18 §2255, at the time of the alleged violations. Each individual would receive this amount, without any need to offer proof of claim or injury and without any further delay. We hope that you discuss this offer with your clients in the next 30 days, as Mr. Epstein’s offer to settle will remain open until March 13, 2009. Very truly yours, An Jay P. Lefkowitz