Police raid at Judge Michalski's home sought evidence of tax crimes

The sources said law enforcement officials are trying to determine whether an online retail clothing and jewelry business operated in the home has been following state and federal tax laws.

And authorities are now seeking information about another individual – Michalski's wife, Susan – in addition to the judge.

“We haven’t been told what the investigation is focused on, but yes, they did take documents from the home relating to a minuscule business run by Mrs. Michalski,” said attorney Anthony J. Lana, who represents Judge Michalski. “It’s a very small consignment business, selling jewelry, clothes and various knickknacks on eBay. The amount of money involved is very small … pocket change.”

No charges have been filed against Michalski or his wife. 

Lana added that he is not aware of any violations of law by either the judge or his wife, who now has her own attorney, Daniel J. Henry Jr.

“The search warrant indicated that agents were searching for information about both the judge and his wife," Henry told The News. "Right now, we’re trying to determine, is she a target, a witness, a subject of the investigation? She wants to protect her rights and protect herself.”   

Judge Michalski's entire court caseload was transferred from him on Friday, one day after the police raid, and officials of the State Office of Courts Administration said no further cases will be assigned to him “until further notice.”

Michalski, 61, is the judge who suffered injuries in February 2021, when he was hit by a freight train in the Village of Depew. Another judge called the incident “a suicide attempt” in a court ruling.

The judge was struck days after learning that Buffalo FBI agents wanted to question him about his relationship with strip club owner Peter G. Gerace Jr., a longtime friend and former client of Michalski.

Agents from the FBI and other federal agencies – who also participated in the raid on Thursday – have continued to investigate Michalski’s friendship with Gerace, owner of the Pharaoh's Gentlemen's Club in Cheektowaga, said the two government sources with knowledge of the probe.

Michalski was struck by the train on the same day Gerace was arrested on felonies including drug trafficking, sex trafficking and bribing a federal drug agent – charges that Gerace denies.

Federal agents and prosecutors have never publicly disclosed why they want to question the judge about Gerace.

According to Lana and Henry, the warrants that allowed police to search the Michalski home gave no indication that investigators were looking in the home for any evidence relating to Gerace or his strip club.

“The warrants made no mention of drugs or weapons of any kind. They were strictly seeking financial information,” Lana said.

Search warrants were issued by judges in state and federal court, and the warrants specifically sought information related to a company called Everydaydeals364, said one source who saw the warrants. The source said the warrants gave police permission to search for “computers, documents and cellphones.”

According to a law enforcement official, Susan Michalski’s online company is called Everydaydeals364. 

Everydaydeals364 has an eBay shop that has sold about 4,700 items since it became an eBay member in 2007, according to the eBay website. It is currently offering for sale about 1,000 items of men's, women's and youth clothing and accessories, with most costing less than $30.  

“They were looking for evidence of tax crimes,” the law enforcement official told The News. “You now have criminal investigations, federal and state, involving the FBI, the U.S. Attorney, the state Attorney General’s Office and State Police.”

The official added that the Internal Revenue Service and the State Department of Taxation and Finance are also involved in the investigations of the judge.

“They are looking into whether there was income from the business that should have been reported,” the official said.

Lana said he doesn’t know whether the Michalskis file joint tax returns or whether they have reported income from Susan Michalski’s online business.

Michalski is also under investigation by the State Commission on Judicial Conduct, which reviews complaints of ethical misconduct by judges. 

“As far as I know, the part-time business of a spouse bears no relationship to the qualifications of a sitting judge nor should it,” said attorney Terrence M. Connors, who is representing the judge in the commission’s ongoing probe.

Financial disclosure forms filed by Judge Michalski from 2014 through 2019 with the Ethics Commission for the state’s Unified Court System show his wife held several jobs between 2014 and 2019.

The judge did not report any income from everydaydeals364. But Susan Michalski had other employment, according to the disclosure forms. She worked in sales for four companies at different times and earned between $5,000 up to $100,000 annually, depending on the employer.

Judge Michalski listed an outside income of $5,000 to $20,000 a year serving as an adjunct professor at Medaille College during that period.