Roger The Dodger

In my June 2 post about the John Edwards trial ("Three Defendants Will Walk"), I predicted that both Roger Clemens and George Zimmerman would be found not guilty of the charges they face in their high profile cases, and promised to write briefly about them. The Clemens case went to the jury yesterday afternoon, so I'm trying to get this out before they come back with a verdict. The Zimmerman trial, for the shooting death of Trayvon Martin in Sanford, Florida, probably won't start until next year.

Clemens, one of the greatest pitchers in the history of baseball, has been charged with lying under oath to the US Congress in 2008 when he testified that he did not use steroids or permit himself to be injected with human growth hormone ("HGH") in violation of civil laws and baseball rules. After conducting 235 interviews with 179 different people, the US attorneys have found themselves in the unenviable position of having to rely on just one key witness, Brian McNamee, to prove their perjury and obstruction of justice allegations. McNamee was the strength and conditioning coach for the Boston Red Sox, Clemens' team at the time of most of the alleged events. McNamee claims that not only did he inject Clemens, at Clemens' request, with HGH, but that he has saved the vials and needles over the last six years. Clemens' DNA is on those items.

One of the long-standing strategies of litigation attorneys is that they want to make their own witnesses appear to be not just truthful but likable as well. The first follows from the second, as it's much easier to believe a likable person. This is particularly true in jury cases, which the Clemens case happens to be. In that regard, McNamee presents a double-barrelled challenge for the prosecution. Even one of the prosecutors, Gilberto Guerrero, admitted to the jury in his closing argument that McNamee was an unsavory character - - all the more likely, Guerrero said, to be the type of guy to supply drugs to the pitcher. If I were the prosecutor, I would not want to pin my hopes of wining the case on the testimony of a low life like McNamee.

Coincidentally, Clemens has been called a low life himself, and more than once. Several years ago, when the charges first surfaced and McNamee was talking to reporters, Clemens "outed" his wife Debbie by telling the scribes that any steroid and HGH McNamee administered were given by McNamee via injection to Debbie (not Roger) to "help her get ready" for a Sports Illustrated swimwear photo shoot. That was information the Rocket Man need not have shared. Clemens was also the protagonist in a famous bat throwing incident in Game 1 of the 2000 World Series when, while pitching for the Yankees, he threw a chunk of a shattered bat in the direction of the Mets Hall of Fame catcher Mike Piazza as Piazza was running to first. Incidentally, Piazza's career batting average against Clemens at the time of the incident was a whopping .578! Coincidence? Clemens, whose fast ball reached 100 miles per hour, also was known as a bean baller, something that did not ingratiate himself with either his opponents or his teammates.  Well-publicized rumors of a ten year affair with B-list country singer Mindy McCready hasn't helped the Rocket's rep either.  From what I have read, Roger The Dodger is not the sharpest knife in the drawer. That is not his fault. But acting like a dipstick is.

McNamee is not the only witness problem the prosecution had to work around. Andy Petitte, a Yankee teammate and one of Clemens' best friends, gave testimony during a congressional hearing that Clemens admitted to Petitte that he used HGH. But during the present trial Clemens' defense counsel, the superb Rusty Hardin, got Petitte to recant his former testimony, saying that "maybe he misunderstood" what his buddy had told him.

In my post about the Edwards case I wrote that there were common threads running between the Edwards and Clemens cases. Both involve (arguably) despicable defendants who are represented by excellent trial lawyers. In both cases, the star witness for the prosecution is a contemptible former friend of the defendant - - Andrew Young in the Edwards case, and Brian McNamee in the Clemens case. Edwards' daughter Cate faithfully stood by her unfaithful father throughout the trial. Debbie Clemens, along with the couple's four sons, did the same for Rocket, even though he "threw her under the bus." How much of that is window dressing for the eyes of the jurors? Both defendants, if found guilty, would likely be handed prison sentences which would put them away for the remainder of their lives. (Clemens faces thirty years if convicted on all counts.) Jurors are human, so this is likely to weigh on their minds during deliberation.

As in any criminal trial, the burden of proof which the prosecution must meet is "beyond a reasonable doubt" (contrasted with the standard of proof in a civil trial of merely "a preponderance of the evidence"). In both the Edwards and Clemens trials, their defense counsel chose not to call either man to take the stand to testify on his own behalf. Although this could play negatively with the jury ("Why didn't he testify?"), the strategy is the proper non-move if (If!) the defense team is confident that the prosecution did not meet that extremely difficult and lofty burden of proof. Andy Petitte was a weak witness. Brian McNamee came across as a rat. Roger Clemens was a World Series champion and will probably be in the Hall of Fame some day. This is America. Game over. I predict Clemens walks.

Three Defendants Will Walk

There are three high profile cases which have been in the national news during the past several weeks. The first to reach a conclusion was the federal case against former US senator and presidential aspirant John Edwards. Three days ago, Edwards was acquitted of one of the six counts brought against him for corruption, and due to a deadlocked jury, a mistrial was declared with respect to the other five counts. The other two cases to which I'm referring are the federal perjury case against former Boston Red Sox pitcher, Roger Clemens, and the widely watched second degree murder case against George Zimmerman in Sanford, Florida.

You are going to have to trust me on this, when I state that I knew two weeks ago that Edwards was going to get his big win. Unfortunately, I was unable to document my bold prediction here on The Quentin Chronicle due to commitments involving my expiring two year term as the President (aka Glorified Bookkeeper) of the Broken Arrow Condominium Association in Hayward, Wisconsin. Before I run out of time (or excuses) regarding the Clemens and Zimmerman trials, I am going on record here and now by predicting that neither of those defendants will be found guilty of the felonies with which they are charged.

The Edwards case was not all that tough to predict, starting with the fact that the prosecution's theory of the case was poorly conceived. In order to prevail, the prosecution would have to convince a twelve person jury that they all had the ability, not to mention the legal right, to read Edwards' mind and then come to the conclusion that he orchestrated an outlandish coverup of contributions in an aggregate amount approaching $1 million. The prosecution must have believed that the jurors would not be able to get past the sordid scumminess of Edwards' personal life and would therefore reject Edwards' position that the controversial donations made in 2007 and 2008 were not meant for his campaign, but instead were used in an effort to hide his affair and resultant love child from his terminally ill wife. Ironically, it was that very scumminess that made Edwards' story more believable. In other words, the worse his personal situation was four or five years ago, the more money he needed to achieve his goal of hiding things from his wife.

The prosecution's star witness, former Edwards' aide Andrew Young, was absolutely skewered by the Edwards defense team. This did not go unnoticed by the jury. Once the jury learned that (i) Young wrote a tell-all book about his days working for Edwards (and thereby calling into question the character of Young), and (ii) most of the allegedly illegal contributions ended up in Young's - - not Edwards' - - bank account, the prosecution probably realized too late that they had placed their bet on the wrong horse. Young came off the witness stand looking almost (almost!) as much of a low life as the defendant.

John Edwards made his millions as a trial lawyer before he became a politician. You can be confident that the legal team he put together was the best money can buy. When the defense rested its case two weeks ago without even calling a single witness, there were some sharp legal beagles who made that collective decision, including Edwards himself. Even with Edwards' devoted daughter Cate available to be called to testify on behalf of her father, defense counsel did not need her as they correctly calculated that the prosecution had failed to prove the charges. That is when I knew that the fat lady had sung.

While it is true that the prosecution could still re-try Edwards on the five counts which ended in mistrial, that is very unlikely to happen, and as coincidence would have it, there are at least five reasons why. First, the campaign finance laws have changed, thanks to the US Supreme Court's recent ruling allowing PACs to make unlimited campaign contributions. Thus, the charges against Edwards for receiving illegal campaign contributions would be brought under obsolete statutory law. This would make it easier for defense counsel if a new trial took place. Under today's current law, a PAC could make the same amount of contributions that Edwards received from individuals in 2007 and 2008, and there would be no cry of foul play. Second, the judge ruled in favor of the prosecution in almost every motion brought before and during trial (including motions to allow salacious evidence which many judges would not have permitted on the grounds of irrelevancy), and still they did not get a single favorable verdict out of six counts. If there were a new trial, there would be a different judge and the prosecution might lose some of those same motions. Third, trials are expensive, and as noted above, many legal observers thought that the Feds should never have brought the recently concluded case to trial in the first place. Would a re-trial be good use of taxpayers' money? Fourth, the prosecution would still have to rely on Andrew Young, who has already proven to be a poor witness. And fifth, a post-trial poll of the twelve jurors found that no more than four of them were willing to find Edwards guilty on any single count. That data is likely predictive of how a future, albeit different, jury would rule.

In the near future I plan to post (more briefly) about the Clemens and Zimmerman cases. There are a few common threads linking them to the Edwards case, and it is my opinion that the respective prosecutors have a difficult row to hoe. As the Edwards case showed us, there is a difference between being a creep and being a felon.

The Case Of The Clawback Crusader

While our country awaits the decision of the US Supreme Court in the so-called Obamacare case, there is another fascinating legal battle going on right here in Minnesota.

Imagine that you are the pastor of a medium size congregation on the outskirts of the Twin Cities metro area. Every year the population of your town is increasing, and with that trend comes a growth spurt for your congregation and the need to expand your facilities. You and your parishioners pray that you will find the means to make that expansion happen, and soon thereafter a donor comes forward with a six or seven figure check. Plans are drawn, a new addition (perhaps a community center where seniors can gather, or a pre-school and day care facility) is constructed, and your building is no longer overcrowded. You feel blessed, and lucky. But, several years later you learn that the donor was a major Ponzi scheme operator, and that the funds he gave you were tainted. Now the government wants you to return that money. Since the money is already spent, in the form of bricks and mortar, that just might be kind of hard to do.

In a different scenario, imagine that years ago you invested most of your life's savings with that same Ponzi schemer, thinking that not only would your money be safe but that you would earn a decent return on your investment. Now your money, along with funds entrusted with that schemer in good faith by hundreds of other innocent people like yourself, has vanished. The money that all of you thought was being invested was actually spent either to support the extremely lavish personal life style of the Ponzi artist, or to pay off people who unwittingly invested before you did.

The two situations described above are not uncommon in the aftermath of the Tom Petters scandal which rocked Minnesota when it first came to light four years ago. By way of background, a Ponzi scheme entails an investment of funds by an initial group of innocent people who are led to believe that the person with whom they are investing will, in turn, reinvest their funds on the individuals' behalf. But instead of making those investments that the Ponzi artist has described to the individuals, he uses the money for other purposes, such as funding his own personal expenses or putting the money in a different investment vehicle than the one promised. Meanwhile, the artist concocts phony statements which look like the real McCoy to the unsavvy investors, with those statements showing a much more handsome rate of return than those people could get anywhere else. Hardly any of the original investors ask to cash out, because they have been led to believe, via verbal assurances and the phony statements, that they are making money hand over fist. In the unlikely event that an original investor does want out, the funds for liquidation come from a second wave of innocent investors. In other words, the first investors are being paid with the seed money invested by the second investors, and so on down the line.

In the Petters' racket, he created phony statements showing investment in goods which, he said, were being sold as inventory to big box retailers such as Best Buy. By the time his accomplice, Deanna Coleman, ratted on him to the US Attorney's office, Petters' Ponzi scheme had resulted in $3.65 billion (that's with a "b") worth of investments made by unsuspecting individuals going down in flames. There was no contract with any retailer. Petters was found guilty and was sentenced to fifty years (compared to Coleman's slap on the wrist of a one year sentence). Petters' companies were forced into bankruptcy, which is under the jurisdiction of the federal court. The court has appointed Doug Kelley, whom I have dubbed "the Clawback Crusader," as the trustee in bankruptcy.

As in any bankruptcy, the job of the trustee is to try to make the pot of dough for the unsecured creditors of the bankrupt debtor as large as possible. One of the tools available to the trustee is the clawback procedure. In a clawback, the trustee forces the recipients of so-called "ill gotten gains" from the debtor to return the money to the court, via the trustee. The theory behind the clawbacks is this: the money obtained in good faith by the unsuspecting party (such as the congregation in my first scenario above) from the bad guy was not his to give in the first place. As cold as that seems, Kelley's argument is that permitting the non-profit recipients to keep the money donated to them by Petters would be unfair to the folks who got screwed by Petters, such as the investors in my second scenario above. Kelley estimates that the amount of money he's targeting for clawbacks is $425 million! At the end of the day (if you can stand that cliche), either the congregation will have to somehow find a way to give the Petters donation back, or the original investors will be left out in the cold, with none of their investments salvaged.

This week, the Minnesota state legislature passed a bill giving the non-profits a huge break. Under the newly passed law, non-profits would only be subject to the trustee's clawback with respect to those funds received from the debtor (in this case, Petters) within two years of the clawback demand. Any funds received further in the past could be kept. (The old law was a six year statute of limitations.) Governor Dayton signed the bill into law, over the dramatic objections of Kelley. Kelley has yet to announce if he will appeal.

The new law obviously works to the severe detriment of the investors. The money which trustee Kelley will be able to recoup for them under the clawback will be significantly less, because Petters made almost all of his donations to the non-profits more than two (but less than six) years ago. Most of those donations were subject to the clawback under the old law, but not under the new one. Conversely, many of the non-profits, such as Minnesota Teen Challenge, Big Brothers And Big Sisters Of The Twin Cities, and the College Of St. Benedict, praised Dayton and the legislature. For now, they can breathe a sigh of relief.

The fact that I was a not a bankruptcy lawyer does not stop me from making a prediction here. If Kelley appeals, I believe he has a better than even chance of getting the new law overturned on the grounds of it being unconstitutional. In my view, the investors have a better claim to those funds than do the non-profits, notwithstanding the fact that the non-profits have long-since spent the money. Additionally, I question whether Minnesota lawmakers can pass such a law retroactively. The rules of the game (reducing the statute of limitations from six years to two) should not be changed after the horse is already out the barn door. Finally, the Bankruptcy Code is a federal law, and if a conflict is deemed to exist between federal and state law, the bigger boys are going to prevail.

Whether or not my prediction proves accurate, this is a very sorry state of affairs. It is impossible for both the non-profits and the investors to win. They are both victims, but one of them will be the much bigger loser.