MONTGOMERY, Ala., Aug. 25, 2006 -- Attorneys for Richard Scrushy have filed their reply to the government's response to the Scrushy team's Motions for Acquittal.
In their reply the defense team says, "When the Court considers the testimony, rather than the Government's fanciful construction of evidence... it becomes clear that the Government actually has no evidence that Mr. Scrushy did anything that the law forbids."
"...the Government attempts to avoid the clear requirement as enunciated by the Supreme Court of the United States that there be an explicit quid pro quo in a bribery case. Clearly, its reason for doing so is that the evidence falls far short of establishing such an agreement between Richard Scrushy and Governor Siegelman. Its effort to dodge this legal requirement through slight of hand attempts to narrow the Supreme Court's legal findings on bribery cases to the specific statute under consideration in those cases must fail...the Supreme Court has dictated the legal requirements in bribery cases broadly rather than as they relate to specific statutes."
"The Government has ignored the protected status of the contributions in question. After not saying a word about whether the contributions were legitimate during the trial, the Government now attempts to cast them as illegitimate which is precisely the mistake the appeals court made that resulted in the reversal of McCormick before the Supreme Court. The testimony at trial from the Government's witness Nick Bailey clearly establishes that the contributions in question in this case were campaign contributions."
Further relating to any alleged scheme in counts five through nine, the brief says,"Since the Government failed to prove the agreement by way of an explicit quid pro quo, the scheme alleged in counts 5-9 also has to fail. The Government never proved that there was a scheme, no one testified about who was involved, what the object of the scheme was, who the participants were or what acts were done in furtherance of the scheme."
The filing goes on to comment about the government's beef with the transcripts used by the Scrushy team to support their acquittal motions earlier in the month. The government in its filing last Friday had urged Judge Fuller to "disregard Defendant's use of these unofficial transcripts."
In Friday's reply to the government lawyers for Scrushy argue that "The Government's position on the transcripts is symptomatic of a central problem that the defense has had to confront throughout this litigation. The Government never wants to deal with precise information and evidence. At every turn, its positions and arguments are driven by a desire to deal only with its construction of the "facts" rather than providing specific and reliable reference to the actual proof at trial."
"The Government's contention that federal program bribery does not require proof of a quid pro quo is contrary to the decisions of the Supreme Court and the 11th Circuit Court of Appeals."
The filing goes on to argue that "evidence of any actions in relation to the political contributions after they were delivered is not relevant to the sufficiency of the evidence as to Defendant Scrushy's intent to commit the offense charged in Count Four." According to the brief, "At trial, Defendant never contested that the first political contribution of $250,000 came from IHS, nor did he ever contest that he procured that political contribution and caused its delivery to the Governor. Any efforts to cause another business (IHS) to make a political contribution for which the solicitor (HealthSouth) expects credit with the politician to whom it is given tells the jury absolutely nothing about the intent of Defendant Scrushy as it relates to the donee (the Governor's lottery campaign). Further, it tells us nothing in terms of whether or not that contribution is to obtain the requisite quid pro quo required to render the contribution an illegal bribe..."
The filing also argues that the "alleged crimes were complete by July 19, 1999, and the indictment was not returned until May 17, 2005 - five years and ten months after the statute of limitations had expired."
Calling the government's indictment "artfully crafted," the brief states this "made it impossible for the Defendants to know there was a statute of limitations problem prior to trial." In the filing it is argued a defense filing for a bill of particulars on counts three and four to which the government objected would have helped the defense know "immediately that there was a statute-of-limitations problem...Instead of defending the conduct that successfully prevented the Defendant from discovering that the statute of limitations had run, the Government now argues that the Defendant has waived the defense..."
The filing was made shortly after 7 p.m. Friday night and comes in the wake of an Alabama Supreme Court decision late Friday that says Richard Scrushy must repay $47.8 million in bonuses he received during the fraud at HealthSouth.
"We conclude that ... Scrushy was unjustly enriched by the payment of the bonuses, which were the result of the vast accounting fraud perpetrated upon HealthSouth and its shareholders, and that equity and good conscience require restitution in the form of repayment of those bonuses," the court said in its ruling.
I talked with Richard Scrushy briefly and he had not read the Alabama Supreme Court opinion and had no comment.
Scrushy attorney Art Leach advised me that he has spent his recent days working on the reply to the government in the Montgomery government corruption case and will have comment in the future after he has had the time to review the opinion.
The court's unanimous decision upholds a lower court order that sided with HealthSouth shareholder Wade Tucker of Birmingham who sued Scrushy.
According to the Associated Press, Tucker's lawyer, John Somerville, calls today's ruling "a victory for the shareholders of HealthSouth." He says it "provides a sense of justice, and the money will go back to HealthSouth."
Scrushy could ask for a rehearing in state court or appeal the decision to the U.S. Supreme Court.
A HealthSouth spokesman declined immediate comment to the Associated Press.
The shareholder's suit claimed Scrushy got the bonuses improperly as the scandal secretly engulfed the Birmingham-based firm for seven years beginning in 1996.
Ruling for the first time on the legal claims in the case, the state's highest court rejected Scrushy's arguments that he was due to keep the money even though HealthSouth lost millions during the period when it was reporting profits.