In 2004, Warren N. Barr, operating as 13th & State LLC, began development of Vision on State, a 253-unit condominium project in the South Loop neighborhood of Chicago, financed with a $55.7 million loan. Sales were slow.
Barr was the head of Renaissant Development Group LLC, which began sales and marketing for the 292-unit Park Lafayette Towers, twin 20-story buildings at 1918 East Lafayette Place, in 2005. Construction was underway in 2007, with a sales and marketing office and a model unit located nearby. The timing was horrible: just as the building was ready for occupancy, the Great Recession depressed the real estate market. Only eight units were sold, and Barr lost the property in a $100 million foreclosure in 2009. Fortunately, the buildings had been completed by that time, making it easy for receiver Bob Monnat of Mandel Group to successfully market the Park Lafayette Towers units as apartments.
Between March 2007 and July 2012, Barr caused buyers to obtain mortgages to purchase condos at Vision on State by making false statements to lenders in loan applications, real estate contracts, and HUD-1 settlement statements about the sales price of the units, the buyers’ employment, income, financial condition, assets, liabilities, sources of down payment, and intention to occupy the condos, and the funds that 13th & State was providing such as the buyers’ down payments, buyers’ incentives, and commissions.
Barr caused false documents to be prepared that concealed from lenders that funds represented as the buyers’ down payments were actually provided by 13th & State, so that the buyers were contributing little or no equity, and that the purchase prices were inflated.
Barr got involved as a buyer in this scheme by applying for a loan to purchase a Vision on State condo. As a part of his application, Barr submitted that he had two bank accounts containing over $70,000; that he was not a party to any lawsuit; and that he did not borrow any money used as a down payment. These were all lies: Barr’s bank accounts contained about $4,000 combined; he was a party to several lawsuits; and 13th & State loaned him all the money for his down payment.
By July 2014, FBI agents had contacted Barr and were negotiating for his voluntary return to the United States. Barr, however, had run into financial difficulties in Saudi Arabia; he could not pay his hotel bill and was unsure if he could afford a flight back to the United States. For months, FBI agents attempted to extradite Barr to the United States. Despite this effort, and before the agents could get to Barr, Saudi Arabian officials detained him for unrelated conduct.
Barr spent six months in a Saudi prison, charged with $26,250 in debts, including his hotel bill, before he was released to FBI custody and escorted back to the United States in February, 2015. He pleaded guilty to the charges.
As Barr began to prepare for his sentencing hearing, he believed documents concerning his detention in Saudi Arabia were relevant; and he believed the government’s failure to produce all those documents was problematic. He accordingly filed a motion in March 2017, seeking discovery of evidence that was “in any way favorable to him or that could lead to such evidence,” including additional documents the government had concerning his detention in Saudi Arabia. The district court granted Barr’s discovery motion three days after Barr filed it. The government then pointed out that some of the requested documents may be classified. As a result, Barr’s counsel underwent a government-clearance process to view the classified material. The government allowed Barr and his attorney to review three classified documents along with additional unclassified material.
Then, in November 2018, Barr’s attorney filed a motion to withdraw because Barr had retained new counsel. Before the district court ruled on that motion, the government turned over more emails concerning the FBI’s attempt to bring Barr back to the United States. The district court allowed Barr to substitute his counsel and delayed the sentencing hearing for another three months. All told, the court continued the sentencing hearing more than ten times. In January 2019, six days before the scheduled sentencing hearing and three years into the litigation, Barr filed three motions. First, he sought to withdraw his guilty plea, alleging that—due to his counsel’s ineffective assistance—his plea was involuntary. Second, he asked the court to dismiss the indictment because of an alleged Brady violation. Third, Barr asked the court to continue his sentencing hearing so his new counsel could seek government clearance and review the previously disclosed classified documents. The district court denied all three motions.
At his sentencing hearing, Barr tried to argue that his time in Saudi Arabia should be a mitigating factor. The district court disagreed and prevented Barr from advancing this argument at the hearing. Frustrated with this result, Barr sought the judge’s recusal. The judge denied the recusal motion and sentenced Barr to 87 months’ imprisonment in February 2019.
