Scrushy Attorney Art Leach on Reply to Government, Supreme Court Opinion

I sat down for a short interview with Art Leach, Richard Scrushy's lead attorney in the Montgomery government corruption trial to discuss the recent court filings related to the defense's motion for acquittal and to find out where the Scrushy lawyers were on a response to a recent Alabama Supreme Court opinion against Mr. Scrushy involving millions of dollars in bonuses he received from HealthSouth from 1997-2002, in the midst of a massive accounting fraud.  Scrushy was acquitted in the criminal trial involving the fraud.

Q:  You filed your reply to the government response Friday and you talk in there a lot about the government's inference that they no longer call these contributions legitimate campaign contributions.  Would you comment on that?

"Well I just found it interesting, perhaps surprising,  that the government would take that tack because at trial they didn't raise that issue and all the evidence, which is what we have to rely on is evidence, is that they were campaign contributions and if you go back and you look in the record you'll see that both of the checks in question here were made out to entities that were related to the governor's campaign on the lottery.  So to say that they were not campaign contributions just is totally contrary to the evidence and contrary to what the government did at trial and so we don't think that's going to hold up with Judge Fuller."

Q:  There's still the issue of quid pro quo in bribery cases.  In there you say the government's trying to dodge that requirement through a slight of hand, can you explain that?

"The argument we make in the brief is that the government wants to say that the quid pro quo requirement only relates to a specific statute.  But if you look at what the Supreme Court has said on that issue, they didn't talk about a specific statute as much as they talked about bribery generically and you have to look at a couple of different Supreme Court cases in order to get there, but when you look at those two cases it's clear that the Supreme Court's talking about bribery and not bribery as it relates to a specific statute.

It makes a difference in this case because our argument is that they did not meet the requirements of law set out by the Supreme Court of the United States."

Q:  You picked up the argument made by the Siegelman defense about the statute of limitations, can you explain the issues involved with that?

"The first issue is that there had been a waiver and we argue in reply that there is no waiver because all the cases that they cite are cases where the issue is raised for the first time on appeal.  A Rule 29 motion is not considered part of the appeal, it's considered part of the trial.  We also don't believe that there's been any waiver because of the way the government not only structured their indictment, but their refusal to share information with us prior to the time that it came to trial.  So our argument is that it's being raised at trial and is being raised at the earliest possible moment due to the fact we didn't realize that the issue is there until all the evidence had been concluded."

Q:  You talk also about Nick Bailey's testimony concerning conversations that he allegedly had between Hanson, Bailey and the governor and you talk in there about the fact that Hanson was not called by by the government to corroborate that.  Your thoughts.

"It's not just Hanson.  We also talk about that with regard to the witness that they could have called related to their scheme to defraud.  The government elected not to call those witnesses and it's not just whether there is or is not evidence, it's the absence of evidence and the absence of testimony and the failure to call witnesses that is also telling with regard to the government's case.  And, you know, the failure to call Hanson and the failure to call Tim Adams, shows that there is an absence of evidence on several different points in the case.  Some relate to the bribery count others relate to the honest services mail fraud counts."

Q:  Can you talk a little bit about the lack of a scheme that you talk about in the brief?

"Normally in cases where you have a mail fraud, not just honest services mail fraud, but any kind of mail fraud, you have a witness who takes the stand and says, 'I was a part of the fraud.  This is what we designed to do.  This is what we want to accomplish.  This is how we went about it and this is what we were trying to achieve. '

In this case they had no one like that.  The closest thing they got is Loree Skelton and Loree Skelton just didn't get there for them.  I think they were surprised by Loree Skelton's testimony and she basically countered every one of the government's theories.  So I kept waiting for the next witness to take the stand and that witness who could say 'Alright, you know this is the way that this was done.  This is what we've attempted to accomplish.  This is how we went about it.'

And they just never got any testimony in that regard.  Nick Bailey was not a participant in that part of the scheme.  In other words what happened once Richard Scrushy got on the CON Board. Nick Bailey's testimony is 'Well, I don't know what happened then.  I didn't have a  piece of that.'  The best he could say is 'Richard Scrushy got to be vice chairman.'  Well, vice chairman's no different from being a member of the board.  So in terms of that scheme and how it was to be executed and who the participants were, there's just a vacuum of testimony and the jury's left to speculate in order to return their verdict."

Q:  Speaking about the jury, what do you say to people that say the jury issued their verdict and now lawyers are trying to get their clients off with a technicality?

"Well, Rule 29, a Motion for Judgment of Acquittal, is not a technicality.  It's a step in the process where a judge compares what the law requires to the evidence that was presented and makes a legal determination as to whether or not the evidence is different or not.  So you might call it a technicality only because to lay people everything that lawyer's do relates to technicalities.  But this is a critical step in the process.  As to the motion that we have filed, we are totally in earnest that we do not believe the evidence is sufficient to sustain the case. "

Q:  Speaking of evidence, there's some talk in the brief about direct versus circumstantial evidence, could you comment on that for me please?

"Well I think that the point there is that the government claimed in their response that we had alleged that they have got to have direct evidence of the quid pro quo, which is not there. We think that their evidence is insufficient whether you look at it as direct or circumstantial evidence.

Direct evidence is when a person says 'I was there.  I heard the conversation and this is what was said.  Circumstantial evidence is a string of facts that lead you to the conclusion that something happened or did not happen and the problem here is even the circumstantial evidence they presented is inadequate because when the governor came out and talked to Nick Bailey, according to the government's evidence, in our view it didn't show that the governor made a decision.

In other words when the governor walks out supposedly from a meeting and shows Nick Bailey a check, the governor right at that moment, was governor of the state of Alabama and could have appointed Richard Scrushy at that moment on the spot.  He had the power.  He had the authority.  He could have done it.  Instead he says 'Here's the check.  Richard Scrushy's halfway there.'  This according to the government's proof. 'I can't believe he's done it.'  Nick Bailey says,'Well what does he want?'  Governor responds,'The CON Board.'  'That shouldn't be a problem,' is what Nick Bailey says and the governor says, 'I wouldn't think so.'

You know in order to have a quid pro quo, the governor should have come out and said, 'I'm going to appoint Richard Scrushy.  Give me the check.  He's held up his end of the bargain.  I'm going to hold up my end of the bargain.  He's going to become chairman or whatever the heck it is of the CON Board.'  That isn't what happened.  So we're simply saying from a legal standpoint that does not indicate there was a quid pro quo.  And you know there's a lot more to it than that.  We're radically simplifying it for your interview purposes.

For instance on that, you know part of the argument we make is that Nick Bailey's testimony just doesn't make any sense, because it's absolutely clear, no one can dispute the fact that that check could not have possibly been there.  There's just no way.  But the government tries to fudge that by saying,'Well, there could have been more than one meeting.

But when we asked Nick Bailey was there any other meeting at which all the participants were present, that's Loree Skelton, the governor, Richard Scrushy, you know, is there a second meeting like that, Nick Bailey says 'no, there's only one meeting like that.'  So, I mean clearly all the evidence points to the fact that that sequence of events where the check is present and the governor's got it in his hand and these statements occur could not possibly happen because you've got all the evidence that indicates that the check isn't even written until July 19.  Couldn't have possibly been in the state of Alabama before the 20th.

Q:  Can you explain to people what happens from here.

"What happens from here is that Judge Fuller will make a determination whether there will be a hearing on the Rule 29 motion.  If he does have a hearing, he'll set a specific date, we'll have a hearing.  It will be argued and at some point he'll come down with his order.  He has discretion to enter a judgment of acquittal on some of the counts, all of the counts...He has wide discretion as far as that is concerned.

Once this is resolved or during the process of this being resolved, we have a deadline to file a motion for new trial which is a request that the judge throw the verdict out and just set the case for another trial. If he decides not to do that, we haven't filed that motion, we haven't made a determination about that yet, but that's somewhere in the future, and then we will be proceeding down the road to a sentencing date."

Q:  Friday the Supreme Court affirmed the Jefferson Circuit Court ruling that Mr. Scrushy has to repay $47.8 million in bonuses.  Where are you at in review of that opinion?

"Well we are in the process of trying to make the decision as to whether or not we file a motion for re-hearing with the Supreme Court.  I have appeared in the lower court in front of Judge Horn.  I will be talking with the other lawyers and those lawyers will be making the decision as to whether or not there's a re-hearing filed in that case.  Part of what we are looking at is the way that this case implicates broader Alabama law and how it possibly hurts businesses in the state of Alabama to have a decision like that, like this in place.  We will likely get to the conclusion of that at the end of this week because we only have 14 days and once we make that decision we will formulate a pleading and it will be filed."

Q:  What about the opinion that has been voiced in the press that since it was a unanimous decision there's really no sense in going back in front of the court?

"You know the whole idea behind a re-hearing is that there might be some problems with the opinion of the court, things that they did not consider that we need to bring to their attention.  You know whether or not you would go and try to attack the entire opinion is one thing as opposed to picking certain segments of the opinion.  But it's just too early for us to say.  We've got a lot of work to do. We're actually working on that today."

Reported by:  Helen Hammons