Siegelman Trial Day 7 - Former Healthsouth Official Implicates Scrushy

Mike Martin (l)
Mike Martin (l)
Margaret Sellers
Margaret Sellers

The corruption trial of former Governor Don Siegelman, ousted Healthsouth CEO Richard Scrushy and two other men entered its seventh day Tuesday. Prosecutors spent the day focusing on a $250,000 donation Scrushy made to Siegelman's education lottery foundation.

The government is trying to convince the jury that the donation was actually a bribe. And testimony Tuesday may have helped their case.

Mike Martin served as Healthsouth's chief financial officer during the Siegelman administration. His testimony, according to prosecutors, proved that Scrushy was intent on bribing the governor to get a seat on a state hospital regulatory board.

"If there's any question about whether Don Siegelman sold that seat to Mr. Scrushy, I think it's been put to rest based on testimony today," said chief prosecuting attorney Louis Franklin.

In the courtroom, Martin said Scrushy told him he needed to donate to Siegelman's education lottery foundation, but he didn't want the check to come from Healthsouth because "it wouldn't look good."

That's when Martin says he and Scrushy contacted UBS, Healthsouth's investment banking firm, and asked UBS to make the contribution instead.

Martin says UBS was reluctant until Scrushy threatened to terminate its contract. Ultimately, he says, UBS came up with a plan.

UBS allegedly forgave another company's debt, so that it could make the donation to the lottery foundation. Martin says Scrushy then made it clear that he wanted to deliver the check in person to the governor.

Scrushy maintains Martin's testimony is a lie. He says Martin would do anything for the government after making a deal prior to Healthsouth's accounting fraud trial last year.

"I think he's just doing what he did before," Scrushy said. "He's just making it up as he goes."

Defense attorneys were expected to cross examine Martin Wednesday.

Earlier in the day, the former chairwoman of that state hospital regulatory board, Margaret Sellers, told jurors that Nick Bailey, a former aide to Siegelman, told her that Scrushy wanted to be vice chairman of the board.

But she said Scrushy never pressured her to take any action and never asked the certificate of need board to grant any special favors for Healthsouth.

Sellers also testified that in 1999 Scrushy told her that he was concerned about an application from Birmingham's Brookwood Medical Center for permission to install an MRI, which is a piece of diagnostic equipment. Brookwood is a competitor of Healthsouth.

She said Scrushy did not tell her how to vote on the Brookwood project and Scrushy recused himself from considering the request. She said the board turned down the application.

Reporter: Mark Bullock
with help from the Associated Press