New York's highest court ruled Monday that families forced to pay high phone rates to talk to relatives in state prison won't receive refunds for the cost.

The lawsuit was first brought by the inmates' families in 2004.

In a 5-1 decision, the Court of Appeals affirmed a lower court's ruling that the families failed to assert legitimate claims under the state constitution.

The court found that the fee was bad public policy, but didn't qualify as being unconstitutional.

Defense organizations and relatives of inmates argued that the state had illegally collected millions of dollars through a prison telephone service contract. They said the state's contract with MCI Worldcom Communication violated the state constitution. The contract has since been taken over by Verizon.

"We're very disappointed," said Rachel Meeropol, a staff attorney at the Center for Constitutional Rights in New York. The center has represented families in the case.

Georgia's biggest court system has warned that a 2010 Fulton County proposal that cuts $53 million from the judicial budget could force them to shut down the courthouse, jeopardize death penalty cases and slash as many as 1,000 jobs.

Fulton County's judicial leaders declared an "economic state of emergency" and warned Wednesday that the cuts, which amount to about a fourth of Fulton County's judicial budget, would lead to drastic changes at the Fulton County Jail, the sheriff's office along with prosecutors, judges and public defenders.

"This is not something you can adjust to," said Doris Downs, the county's chief superior court judge. "This is going to dismantle the justice system."

The proposed cuts, which were released last week, are part of a spending plan that would slash the county's funding by $148.2 million in 2010. Downs and other judicial leaders said the cuts came as a surprise to them and urged commissioners to rethink the spending plan before it plunges the legal system into a "crisis."

Fulton County Commission Chair John Eaves said the spending plan is still tentative and that commissioners will approve final changes in January. But he said that the judicial system will have to shoulder a portion of the cuts along with other county agencies.

Regina Schenck, 46, of Herald, a small community in southern Sacramento County, is headed to prison for three years and five months, the sentenced handed down for her stealing $1.3 million from her employer, Sacramento law firm Diepenbrock Harrison.

She was also ordered to repay the $1.3 million to her former employer plus $264,000 in restitution to the IRS. She pleaded guilty on Sept. 1.

Between 2003 and 2008, Ms. Schenck wrote law firm checks to pay her own bills, created false documents, and told lies to cause law firm partners to authorize checks that she secretly used to buy five horses and a horse trailer, according to Assistant U.S. Attorney Matthew Segal, who prosecuted the case.

She also used the law firm’s computer network to inflate her salary, give herself bonuses and benefits, and she omitted her fraud-procured income from her tax return, prosecutors say.

A federal appeals court in New York says the CIA did not violate Valerie Plame's free speech rights.

The 2nd Circuit Court of Appeals upheld a 2007 lower court decision in its ruling Thursday. The decision barred Plame from revealing the length of her tenure with the CIA in a memoir.

The appeals court agreed that the agency made a good argument to keep the information secret.

Plame's identity was revealed in a syndicated newspaper column in 2003 after her husband, former Ambassador Joseph Wilson, began criticizing the war in Iraq.

She and her publisher sued the CIA in 2007. They claimed they had a First Amendment right to publish her dates of employment.

Scott Rothstein, the Florida lawyer whose firm asked U.S. prosecutors to investigate the alleged disappearance of $500 million in investor funds, was accused in a government filing of conducting a “Ponzi” scheme.

Acting U.S. Attorney Jeffrey Sloman in Miami is seeking the civil forfeiture of eight properties linked to the lawyer.

“There is probable cause to believe that the above- described defendant properties were acquired in connection with a ‘Ponzi’ scheme, conducted by attorney Scott Rothstein” and others, according to Sloman’s filing yesterday in federal court in Fort Lauderdale, Florida.

The law firm, Rothstein Rosenfeldt Adler PA, asked U.S. prosecutors to investigate the possible misappropriation of funds, the firm’s attorney, Kendall Coffey, said in a Nov. 3 interview.

Rothstein, the Fort Lauderdale-based firm’s co-founder, is believed to have taken the funds from a side business that dealt in legal-case settlements, Coffey said then.

Investors were allegedly being enticed to invest in pay-out plans for settlements that didn’t actually exist, prosecutors said. The payments were scheduled over as many as 12 months.

“The entire investment scheme was a fraud,” Sloman’s office said in the court document. Some of the investor proceeds were used to acquire the properties now sought by the U.S., all of which are located in Florida.

The Supreme Court is considering whether sentencing a juvenile to life in prison with no chance of parole is cruel and unusual punishment, particularly if the crime is less serious than homicide.

The cases being heard Monday involve two Florida convicts. Joe Sullivan was sent away for life for raping an elderly woman when he was 13. Terrance Graham was implicated in armed robberies when he was 16 and 17.

Graham, now 22, and Sullivan, now 33, are in Florida prisons, which hold more than 70 percent of juvenile defendants locked up for life for crimes other than homicide.

Lawyers for Graham and Sullivan argue that it is a bad idea to render a final judgment about people so young.