By Bill Wichert

Law360 (March 23, 2020, 4:27 PM EDT) -- Two men accused of taking part in a cryptocurrency-related Ponzi scheme and bilking investors out of $722 million have asked a New Jersey federal court to release them from a county jail amid fears of catching the novel coronavirus, suggesting a COVID-19 outbreak at the facility is inevitable.

In separate motions filed over the past four days, Matthew Brent Goettsche and Jobadiah Sinclair Weeks urged the court to let them out of the Essex County Correctional Facility in Newark, New Jersey, citing concerns about their health and related problems with meeting with their attorneys while behind bars.

"It is not a matter of 'if,' but 'when' the DOC has its own COVID-19 outbreak," Goettsche's attorney, Rodney Villazor, said Friday in a letter to U.S. District Judge Claire C. Cecchi, referring to the Essex County Department of Corrections. "Once the virus is introduced, it will be nearly impossible to stop its spread."

"The risk to Mr. Goettsche's health and safety grows with each day that he remains incarcerated at the DOC," Villazor added.

Weeks' lawyers echoed those points on Monday in seeking his release, noting the county jail has "an exceptionally poor record of maintaining detainee health."

His attorneys pointed to the findings issued last year by the U.S. Department of Homeland Security's Office of Inspector General, which found issues at the jail that "'represent significant threats to detainee health and safety,'" according to Weeks' brief.

Among other conditions, investigators found "leaks causing mold and mildew growth 'in every housing unit holding detainees,'" and identified food safety concerns including "'raw, spoiled, or expired' meat, 'raw chicken,' 'expired and moldy bread,' and 'hamburgers that were foul smelling and unrecognizable,'" the brief stated.

"At a minimum, these conditions reflect neglect of and a lack of concern for detainee health, even in the best of times at the Essex County Correctional Facility. Adding a highly contagious virus to the mix results in a recipe for disaster," according to the brief.

"Given the noted risks of illness through inadequate food service and environmental safety at the Essex County Correctional Facility, a swift outbreak of COVID-19 at the facility is virtually inevitable," the brief added.

Goettsche, Weeks and co-defendant Joseph Frank Abel have been charged with running purported cryptocurrency mining pool company BitClub Network, soliciting money from investors in exchange for shares of purported cryptocurrency mining pools and offering bonuses for the recruitment of new investors, prosecutors said. A fourth man, Silviu Catalin Balaci, also has been charged in the scheme.

According to the indictment, Goettsche, Weeks and others solicited BitClub investments by showing investors false and misleading figures that purported to show earnings from BitClub's bitcoin mining pool operations. Prosecutors say Goettsche and others manipulated the earnings numbers in order to promote the sale of bitcoin mining shares in BitClub and to convince members to invest additional funds in BitClub's cryptocurrency-related products.

Given restrictions at the Essex County jail amid the global coronavirus pandemic, Goettsche and Weeks each argued that remaining there could impede his ability to meet with his respective attorneys and prepare a defense.

Villazor, Goettsche's attorney, noted on Friday that the jail has issued new guidelines that "severely limit" visits by attorneys, "placing complete discretion in the facilities' guards to decide whether to allow an attorney contact visit on a 'case-by-case basis,' after the attorney 'communicate[s] the need and reason for the contact visit to the visit sergeant.'"

"This means we will only learn whether we can or cannot have a contact visit with Mr. Goettsche on site, upon physically appearing at the DOC,"  Villazor said, adding that the jail prohibited him from bringing hand sanitizer and disinfectant wipes during a recent visit with Goettsche.

Villazor further cited the substantial amount of electronic discovery in the matter and said the only practical method for Goettsche "to review discovery and meaningfully assist in his own defense is to view discovery on a laptop with counsel by his side within the cramped confines of the attorney visit room."

As a result of the ongoing public health crisis, Goettsche and defense counsel are "forced into a Hobson's choice" — ignore protocols recommended by the U.S. Centers for Disease Control and Prevention and "meet in close quarters at the Essex County detention facility to review discovery" or "forego Mr. Goettsche's Sixth Amendment rights to a speedy and public trial, and wait indefinitely for the spread of COVID-19 to sufficiently dissipate," Villazor said.

Weeks' lawyers on Monday pointed to the possibility of a 23-hour lockdown at the jail for pretrial detainees to prevent exposure to COVID-19. If Weeks was placed in "perpetual lockdown," he would not be able to assist in reviewing discovery, according to his brief.

"Mr. Weeks cannot access this information electronically; he cannot participate in an online/virtual meeting with counsel," the brief stated. "In short, continued detention of Mr. Weeks during this pandemic cripples his ability to participate in the development of his defense."

Matthew Reilly, a spokesman for the U.S. Attorney's Office for the District of New Jersey, said Monday the office declined to comment.

Weeks attorney Michael L. Yaeger of Carlton Fields PA told Law360 on Monday, "These are scary times for everyone, and especially for people who are not allowed to protect themselves in the ways the rest of us are trying to. Joby Weeks just wants to stay healthy and be in a place where he can safely prepare for his day in court."

Counsel for Goettsche did not immediately respond to a request for comment Monday.

The government is represented by David W. Feder, Anthony P. Torntore, Jamie L. Hoxie and Sarah Devlin of the U.S. Attorney's Office for the District of New Jersey.

Goettsche is represented by Rodney Villazor of Smith Villazor LLP and Benjamin Sauter, Andrew Lourie and Hartley M.K. West of Kobre & Kim.

Weeks is represented by Simon Gaugush and Michael L. Yaeger of Carlton Fields PA.

The case is U.S. v. Goettsche et al., case number 2:19-cr-00877, in the U.S. District Court for the District of New Jersey.

--Additional reporting by Stewart Bishop. Editing by Janice Carter Brown.

Update: This article has been updated with additional counsel information.

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