V Visa Inc

   (FROM THE WALL STREET JOURNAL 8/31/15) 
   By Robin Sidel 

Keila Ravelo, an immigrant who became a successful New York antitrust lawyer, wasn't shy about celebrating her achievements.

The 49-year-old drove a Bentley Continental "Flying Spur" sedan and favored Hermes handbags. She also spent tens of thousands of dollars annually to send her two sons to a sports-oriented boarding school in Florida. Starting in 2008, she has donated more than half a million dollars to Democratic candidates and political-action committees.

But when federal agents showed up at her New Jersey home three days before Christmas, they kicked off a chain of events that could send her to prison and scuttle the biggest antitrust settlement in U.S. history. It already may have ended her marriage.

It is a stunning downfall for Ms. Ravelo, who until late last year was a partner at global law firm Willkie Farr & Gallagher LLP, where her primary client was MasterCard Inc. The agents alleged that Ms. Ravelo and her husband bilked MasterCard, Willkie Farr and another law firm out of more than $5 million by setting up fake vendors and filing sham invoices for legal services.

As part of its investigation into the alleged theft, court records allege that Willkie Farr subsequently discovered that Ms. Ravelo had received confidential information via emails from an opposing lawyer working on two major antitrust lawsuits brought by retailers against credit-card companies, one of which resulted in a record $6 billion settlement with MasterCard and Visa Inc. The lawyer, Gary Friedman, was a longtime friend and former colleague of Ms. Ravelo's, according to court records.

Now, the record-breaking pact may be in jeopardy. On Tuesday, lawyers on both sides will file court documents arguing whether the settlement should be unraveled because of the two lawyers' behind-the-scenes actions. Many large merchants that have objected to the settlement, including Wal-Mart Stores Inc. and 7-Eleven Inc., now want to undo it, but Visa and MasterCard are expected to ask that it stay in place. Among their arguments: They said Ms. Ravelo was never a key player in the case.

But in a harshly worded 44-page ruling, U.S. District Judge Nicholas Garaufis this month threw out a settlement in a parallel case involving American Express Co. because of the emails. The judge said Ms. Ravelo helped Mr. Friedman frame the legal issues and come up with a settlement strategy, among other things. At least twice, Mr. Friedman wrote Ms. Ravelo emails that said, "Burn after reading," the judge said.

Mr. Friedman's lawyer declined to comment. Steve Sadow, an Atlanta lawyer representing Ms. Ravelo, declined to comment on the judge's ruling.

Ms. Ravelo's fall stunned the New York legal community, where she was generally well respected, according to a number of lawyers who worked with her. "It is inexplicable," said one person who worked closely with Ms. Ravelo for more than a decade, referring to the sharing of documents in the antitrust cases.

Ms. Ravelo is free on $500,000 bail in connection with the alleged plan to bilk the law firms and MasterCard. She has been charged with conspiracy to commit wire fraud and is in plea negotiations, according to court records.

On Tuesday, her husband, Melvin Feliz, pleaded guilty to conspiracy to commit wire fraud and tax evasion in connection with the case. Mr. Sadow, Ms. Ravelo's lawyer, slammed the development, saying the husband "caved to the intense and overwhelming government pressure to implicate Ms. Ravelo."

In his statement, Mr. Sadow said his client had hoped Mr. Feliz would "take full responsibility for his actions by publicly proclaiming what he has repeatedly and consistently told his family: that Ms. Ravelo acted as [Mr.] Feliz coercively demanded -- not freely, voluntarily or with criminal intent." Mr. Sadow referred to Mr. Feliz as Ms. Ravelo's "estranged husband." Mr. Feliz's lawyer declined to comment.

Mr. Feliz has additional legal troubles. He is awaiting sentencing after pleading guilty in February to plotting to transport more than 40 pounds of cocaine from California to New York. Police arrested him in March 2014 after receiving a tip that Mr. Feliz and two other men were planning to arrange to pay $550,000 to buy the drugs and move them across the country in a tractor trailer, according to a criminal complaint.

Before the past year, Ms. Ravelo's life had been a steady ascent to professional success and personal affluence. Raised in the Dominican Republic, Ms. Ravelo came to the U.S. when she was 17 to attend college. She graduated from Columbia University's law school in 1991 and was courted by multiple top law firms. Twice, firms put out news releases after hiring her, citing her experience in handling complex antitrust litigation. At Willkie Farr, she earned about $2.5 million a year, according to a person familiar with the matter.

In her private life, Ms. Ravelo was featured on a New Jersey-based social and celebrity news website, in a 2013 article titled "The Modern and Classic Style of Keila Ravelo." That same year, she appeared in an "NBC News" segment about parents who spend large sums to encourage their children's sports dreams. The segment estimated that Ms. Ravelo and Mr. Feliz spent more than $70,000 a year on baseball-related activities for each of their two sons.

Ms. Ravelo also was a board member of the National Center for Law and Economic Justice, an organization in New York that works with low-income families. From 2008 to 2014, she donated over $500,000 to Democratic causes and candidates, according to Sunlight Foundation, which tracks political contributions.

Ms. Ravelo first met Messrs. Friedman and Feliz in the early 1990s, when she was an associate at Sidley Austin LLP. There, she worked with Mr. Friedman, a fellow associate, on a pro bono case representing her future husband, Mr. Feliz.

Over the years, Ms. Ravelo and Mr. Friedman remained close friends, with their families socializing and going on vacation together, according to court records. The two lawyers also discussed investment opportunities and at one point considered buying a Gulfstream II jet and operating an air-charter business, according to court papers. While Mr. Friedman started his own firm, Ms. Ravelo moved on to law firm Clifford Chance LLP, where her biggest client was MasterCard.

A decade ago, retailers including Kroger Co., Safeway Inc. and Walgreen Co. filed price-fixing suits against Visa and MasterCard that challenged their long-standing rules prohibiting merchants from charging more when they used a credit card over other forms of payment. The case received class-action status, laying the groundwork for years of negotiations between the merchants and card network. At the time of the settlement, Visa and MasterCard said that it was in the best interest of all parties.

In the case, Ms. Ravelo's job was far from glamorous. She spent most of her time dealing with discovery, the painstaking process of hashing out the exchange of documents with opposing lawyers, according to people who worked with her.

Mr. Friedman represented merchants in the Visa-MasterCard case, as well as the similar case involving American Express.

The substance of the communication between the two has largely been filed under seal, but court records show it went beyond a typical exchange between opposing lawyers. The exchange included confidential information about AmEx that Mr. Friedman passed onto Ms. Ravelo. She also gave Mr. Friedman advice on discovery processes and a slide presentation, Judge Garaufis said in his ruling. Mr. Sadow declined to comment.

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August 30, 2015 20:06 ET (00:06 GMT)

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