A multimillion-dollar bash and sexual conduct don't prove a crime, Dennis Kozlowski's lawyer asserts.
By Associated Press
Published March 16, 2004
NEW YORK - A video of a $2-million birthday party presented at the trial of two former top executives of Tyco International and questions about sexual partners had nothing to do with their case, a defense lawyer said Monday in closing arguments.
Stephen Kaufman, attorney for former Tyco chief executive officer L. Dennis Kozlowski, said those things were mentioned to confuse jurors and incite prejudice against the defendants.
Prosecutors contend Kozlowski, 57, and his co-defendant, former chief financial officer Mark Swartz, 43, looted the conglomerate of more than $600-million and used the money to finance a lavish lifestyle.
Kaufman referred to the 40th birthday party that Kozlowski threw for his wife Karen on the Italian island of Sardinia in June 2001. The party featured scantily clad young men and women, along with singer Jimmy Buffet, flown in at a cost of $250,000. Half the bill - $1-million - was paid by Tyco as a "business" meeting, testimony showed.
Kaufman also said Kozlowski felt "sorrow and contrition" for dalliances with two women who testified that they were involved with the CEO while they worked at Tyco.
"I don't say those relationships were appropriate," Kaufman said. "I do say they were irrelevant. These should not be facts that you consider when you deliberate the guilt or innocence of my client."
The two are accused of stealing $170-million by taking unauthorized bonuses and by abusing loan programs, and $430-million more by manipulating Tyco stock prices from 1995 through 2002.
But Kaufman said the former CEO earned - and internal and external auditors were aware of - every penny he got from Tyco. "He never robbed; he's not a thief. He never stole from the company," the lawyer said.
"The board of directors supported Dennis 100 percent of the time," Kaufman said. "They never refused a request of Dennis'. This board was so supportive of Dennis; they said he could spend $200-million whenever he wanted."
"You will not find, ladies and gentlemen, that Dennis ever stole a dime from Tyco."
"His focus was Tyco," Kaufman continued. "It was not the focus of someone who stole. It was the focus of someone who created. He is the architect of a splendid creation."
Kaufman spoke emphatically but in a weak voice, his recovery from the flu still evident. His summations were postponed last week when he became ill.
Monday's summations were delayed about two hours when juror No. 5 became sick, apparently with the flu. Justice Michael Obus dismissed her after consulting with her doctor. She was replaced by an alternate.
Charles Stillman, attorney for Swartz, presented his summation last week. He told the jury that after 47 prosecution witnesses and 700-plus exhibits, there was "not one thimble full of proof" against Swartz.
Swartz and Kozlowski are charged with a total between them of 32 counts of grand larceny, falsifying business records and violating state business laws. The grand larceny charge - a "megalarceny" under state law since it alleges theft of more than $1-million - is punishable by up to 25 years in prison.
JUDGE CITES ERROR IN ADELPHIA CASE: The judge in the fraud trial of the Rigas family said Monday that prosecutors had made "an egregious error" and a motion for a mistrial would be appropriate.
In questioning former Adelphia Communications Corp. director Dennis Coyle last week, the government had sought to show that Rigas-owned businesses incurred debt guaranteed by Adelphia, even though the businesses did not fulfill some financial requirements for such guarantees. On Monday, Coyle testified that he now realizes that his understanding of the requirements was wrong.
"The fact that the government made an egregious error is very unfortunate and would appropriately be dealt with on a motion for a mistrial," U.S. District Judge Leonard Sand told lawyers before jurors arrived in court Monday. He added that he was not suggesting what the outcome of such a motion would be.
Former Adelphia chairman John Rigas, two of his sons, and former Adelphia executive Michael Mulcahey face charges of fraud and conspiracy in an alleged effort to loot the company and mislead creditors, investors and the public. All four have pleaded not guilty.
John Rigas was not in court Monday. He was at the Mayo Clinic in Rochester, Minn., for bladder-cancer treatment following an appointment there last week. He is expected to be out today as well.
Actor Peta Wilson gave the trial a touch of glamour Monday when she testified that she flew on Adelphia's corporate jet at least eight times at the invitation of Timothy Rigas, often for "personal" purposes. Wilson said she didn't reimburse Adelphia for the flights.
Wilson starred on the cable television series La Femme Nikita and in the recent movie The League of Extraordinary Gentlemen.
