Man Accused in Blackstone Extortion Blames Firm

NEW YORK (Reuters) – A man accused of trying to extort millions of dollars from his son-in-law, an executive of the Blackstone Group LP, on Wednesday blamed the private equity firm for his “malicious” arrest and charges.

The case in New York State Supreme Court against Stuart Ross, estranged father-in-law of Blackstone Senior Managing Director David Blitzer, was adjourned until September 23 to give Ross time to find an attorney.

But outside the courtroom, Ross, 71, said he believed that Manhattan District Attorney Robert Morgenthau brought the charges against him and his friend Stuart Jackson, 79, “at the behest of Blackstone to attempt to crush two innocent individuals.”

Asked for comment, Blackstone Group spokesman Peter Rose said, “That is utter nonsense.”

Ross said he and Jackson were arrested on Friday after a sting operation in the Union League Club in Manhattan on Thursday. They were charged with attempting to extort as much as $11 million from Blitzer, an executive at Blackstone's London office, and face up to seven years imprisonment if convicted.

Ross, of Aventura, Florida, is a non-practicing attorney and once-successful businessman who has been estranged from his daughter, Allison Blitzer and her husband, David Blitzer, since 2002.

Ross was released on bail of $2,500 at arraignment in the early hours of Saturday and Jackson was released on his own recognizance. Jackson, of Manhasset, New York, is accused of acting as Ross' attorney in negotiations with Blitzer and his lawyer over several months.

Judge Melissa Jackson ordered the defendants not to contact the family in any way.

“We believe this is totally unlawful, totally malicious,” the gray-haired Ross, who was dressed in a blue business suit, told reporters. “This was a preconceived operation by Blackstone to show its strength.”

In a statement on Friday, the prosecutor said Ross, in telephone calls, e-mails and voicemail messages, “made threats to ruin Blitzer's life, personally and professionally, unless Blitzer paid off Ross.”

But Ross said on Wednesday that the case was about his request to have visitation rights with his grandchildren and he believed he had an agreement with Blitzer.

In a separate civil lawsuit filed on Friday, Blitzer sued Ross for $11 million. He accused Ross of stealing hundreds of thousands of dollars from him in a “relentless campaign of harassment and threats” to Blitzer and his family.

It described how Ross was once successful in business with licensing rights to the Smurfs cartoon characters, but a series of business mishaps led him to lose much of his money before he met Blitzer.

An attorney for Blitzer declined to comment.

By Grant McCool

(Editing by Maureen Bavdek)