Judge in Amazon-Watson case ‘reluctantly’ recuses himself

Northstar CEO

Brian Watson is the CEO of Northstar Commercial Partners, which is being sued by Amazon.

A new judge has taken over the long-running lawsuit filed by Amazon against a Denver-based commercial real estate firm.

Judge Liam O’Grady of the Eastern District of Virginia recused himself on Monday from the case against Northstar Commercial Partners after disclosing his wife’s ownership of Amazon stock, saying in a court filing that he did so “reluctantly.”

In its lawsuit filed in April 2020, Amazon accused Northstar, which is fully owned by CEO Brian Watson, of bribing two Amazon employees in order to win data center development deals in northern Virginia. Watson has denied wrongdoing.

Liam OGrady.jpeg

Liam O`Grady

In mid-December, O’Grady disclosed in a court filing that he had learned on Nov. 23 that his wife held about $22,000 of Amazon stock in a brokerage account. He said his wife sold the stock in early December.

The conflict was highlighted by the Wall Street Journal in a story late last month.

In his initial filing, O’Grady said that he had determined that he did not need to recuse himself from the case. Amazon supported that conclusion. But Watson and one of the ex-Amazon employees, Carl Nelson, objected.

“It’s very important for my client that there be complete due process and an appearance of fairness in how these issues are being resolved,” Brownstein Hyatt attorney Stan Garnett, who represents Watson, said in a hearing on the matter last week.

O’Grady said in the hearing that he believes he has been impartial while overseeing the case, and that he could continue to be impartial going forward. He said a broker handled trades for his wife, and that he was “completely ignorant of any of the dealings.”

O’Grady also noted Amazon’s size, and said the case before him would “in no way ever affect the stock price of Amazon’s stock.”

“Nothing I could ever do in this case could have an impact,” he said, according to a transcript. “So the underlying basis for … my impartiality being questioned is 100 percent flawed.”

In his Monday recusal, however, O’Grady said he was stepping aside, however, because of the optics.

“Perception of the fair administration of justice — both by the public and by the parties in the case — is of the highest importance to the court,” the judge wrote. “Also importantly, my learned and honest colleagues should not have to suffer possible criticisms that might target them and me by those who do not understand the issues involved, if I were to decide not to recuse myself.”

The case is now assigned to District Judge Michael Nachmanoff.

Northstar CEO

Brian Watson is the CEO of Northstar Commercial Partners, which is being sued by Amazon.

"Perception of the fair administration of justice ... is of the highest importance to the court," wrote Liam O’Grady, whose wife had owned about $22,000 worth of Amazon stock.

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