When Justice Fails

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Guest Analysis
by Philip Smith

In the matter of Don Siegelman, try to put aside everything we know, that we’ve heard, that we’ve been filled up with by hopeful parties from both sides of the fray. Put Karl Rove on a shelf for a minute next to Bill and Leura Canary alongside of Alice Martin. Set aside the writings of Scott Horton, the editorials of the New York Times, the political blogs — what Rove calls the net root — The Huffington Post, The Daily Koss and The Locust Fork News-Journal.

Forget the allegations of Jill Simpson and the dire press releases put out by Lewis Franklin on behalf of the DOJ’s Middle District of Alabama. And for the moment, for this article, we will also set aside names like McCormick and Evans and the specialized legal semantics that often makes the determination of life and death; or matters of freedom and imprisonment, dependant on the shades of meaning found in a single word. Unhook yourself from the guerrilla war being fought over the left-right lateral plane using the Siegelman-Scrushy case as a battleground.

Our system of justice is the hallmark of our democracy and it is still very often the envy of the world. For many people in foreign lands who long for basic civil rights, who long to be able to protest a government without persecution, who long to be free of capricious arrests and mob rule justice, they look to the American Judiciary as a time-tested beacon and a monument to the rights of individuals. It was forged in the revolution, codified by the Constitution and tested over time by a variety of wars that proved that a nation could be secure and strong while protecting personal liberties. The hallmarks of our system are an independent judiciary, a right to a trial to be decided by our peers, a right to competent representation, and an assurance that justice is blind, that no man or woman is too rich, too poor, too powerful, too unimportant, too unpopular, too arrogant, too humble to not be treated as equals, to not be leveled of all of the attributes that might make the defendant stand out in a crowd. That is the noble goal of a good system and most of the time it works, and justice is blind enough not to notice the many traits that might set a defendant apart from the rest of us. This system usually works even when we, as individuals, can not hope to be so blind.

But is it possible that this system, this hallmark of our democracy can be fallible? That justice can fail? And is it possible that we can be perceptive enough — as blind as Lady Justice — to see it when it does?

Quid Pro What?

The indictment, trial and conviction of Don Siegelman and Richard Scrushy came swirling out of a confluence of issues that although reflective of modern public sentiment raises disturbing questions about the co-mingling of public opinion and justice, and about the practice of adversely manipulating the judicial process. The venerable and time-tested jury system, which is a cornerstone of our judiciary, is being tested like it never has been before. And it runs both ways. Teams of specialized lawyers have successfully mounted OJ-style defenses to overwhelm juries with a blizzard of confusing challenges to forensic evidence, and likewise, prosecutors have tactically taken advantage of the complexity of many white collar crimes in order to “teach” a jury the law so they may win a conviction.

This trend of legal tactics outstripping the built-in protections of the jury system is the backdrop, but in the matter of Don Siegelman and Richard Scrushy, there were other factors that led to an extra-legal result.

First, there is an increasingly restive general public that has been primed to be mistrustful of the flow of money into political parties or politically-based initiatives, there is a general distrust of lobbying and lobbyists with an often repeated assessment that any money that is given to a political campaign or politically driven initiative is wrong, and on top of that, there is a rising distrust of politicians, in general. In the middle of this climate, there are the particulars of the two individuals involved. Following Siegelman’s ascension to the State House as a Democrat in a red state, he was under a constant and withering media attack. His supporters claim that much of this attack was orchestrated or synthesized from leaked information by his political opponents, and it is one plank of Siegelman’s argument that his prosecution was politically motivated. But in this effort to leave the specific political threads out of this argument, we can dismiss this strand in favor of looking at the climate itself, the strange brew of public sentiment that made this case something that could happen anywhere. It wasn’t just something that happened to a Democrat and businessman in Alabama, but it could happen to any politician it could happen to any businessman.

Besides these media attacks, over a year before his indictment, the DOJ’s Northern District of Alabama leaked information about unsubstantiated accusations that Siegelman was never charged with. This toxic mix of rumors and allegations lingered for 18 months before Siegelman would face the jury in Montgomery. And that is still only the half of it.

It wasn’t just anybody who sat at the defense table with Siegelman. It was Richard Scrushy, perhaps the most universally hated man in Alabama. This can not be understated. The indictment unsealed nearly two and a half years after the HealthSouth fraud scandal had become public knowledge, and six months after Scrushy had been acquitted of wrongdoing, in the HealthSouth fraud. Scrushy’s own pollsters had it that over 80 percent of the population in the district where he was indicted thought that he should have been found guilty and that he should be in prison. To this day, when the media trumpets Siegelman’s case, they generally leave out the part that the other party is Scrushy, because like the population of Alabama, they most likely think Scrushy is a criminal.

Now the questions: Even if the charges, indictment and seating of the jury technically met legal standards, could it have been possible for Scrushy and Siegelman to have a fair trial? Not just in Alabama, but anywhere?

Going outside of the staid boundaries of the courtroom, and appealing to our own sensibilities, is it fair to ask a jury to be the arbiters of questions that were never dreamed of by our founding fathers? How about if we consider the fact that over 100 people who raised more than $100,000 for George W. Bush’s campaign ended up with government jobs. Twenty-three of them received ambassadorships and three were named to cabinet level positions (according to published accounts in the Washington Post and elsewhere). Over half of the people in the $100,000 club were corporate heads, hopeful CEOs just like Scrushy. Some of these corporate leaders came from companies that would later become notoriously famous (names like Enron, AIG, Merrill Lynch, Lehman Brothers & Co. and Bears Stearns & Co.) and some of the individual donors, such as Jack Abramoff, would later also become similarly famous. But like Don Siegelman, President Bush could not have known that some of his biggest supporters would eventually be in jail. Bush also used well known go-betweens, like Karl Rove, who had well-documented visions of using a wide variety of methods to win the right that he could brag that he could get things done for his client. This comparison is not meant to cast aspersions on the previous presidential administration but just to underscore the blurry lines between legal and illegal campaign financing and how without absolute and concrete proof, it is impossible to ask ordinary citizens to make a clear distinction and to be confident enough in their decision to put someone in prison.

Is it fair to ask members of the general public to see through the fog surrounding the legally protected practice of lobbying and the fuzzy Rubicon that turns the hopes of a businessman and a politician into a legal matter where the stakes are prison and personal ruination? Was this the way justice was supposed to work in this country?

Crossing the fuzzy line with a nexus

Although this is an extra-legal rendition of the facts surrounding the Siegelman-Scrushy case, it is necessary at this point to introduce a nexus or two, something that the legal community is fond of. Let’s plug a confusing, misunderstood legal distinction into an unstable landscape where people mistrust politicians and businessmen alike, and where they particularly don’t care for Don Siegelman and Richard Scrushy, and then let’s make the lynchpin Nick Bailey, the witness whom the success or failure of the case depends upon.

As a background, it is a long settled and a typical legal investigative practice to use criminally responsible individuals as cooperating witnesses. The value of these witnesses in the courtroom is supposed to arrive at an equilibrium determined by weighing what they have to say for the prosecution against defense efforts to explore the witnesses’ own criminal behavior and the nature of the deal that led to their testimony. In the end, the jury is given the Solomon-like task of deciding which side seems more believable. But the situational aspects surrounding Bailey seemed to tip the scale to make him the perfect weapon for the prosecution, even if Lady Justice’s blindfold had slipped a bit as it would turn out that he wasn’t exactly the best harbinger of the truth.

Let’s consider a couple of aspects of the case, where it concerns this witness. Whereas Siegelman was convicted of receiving money that was used to defray the expenses of a statewide initiative for education, in Alabama, Bailey was convicted of taking bribes because he had gotten in over his head by trading in hog futures. Except to show that the two men had vastly different goals, this set of facts is not all that relevant by itself. A couple of the other dimensions Bailey brought in are much more important. Bailey had fallen in with Lanny Young, an opportunistic man who was the government’s main witness to all of the charges that Siegelman was acquitted of, and a man who appeared to make his way by wielding a heavy-handed influence over people, and then implying that he could get things done via his access or implied access to people he knew. In the end, both Young and Bailey were swimming up the same stream and they were heavily squeezed to give state’s evidence against Siegelman.

How do we know about the pressure and coaching of Nick Bailey that led to the massaging of this tenuous link into a lynchpin? Besides the fact that Bailey’s personality seemed to be vastly different than the careful diction that was coming out of his mouth, and that it appeared he was spitting out a constant robotic stream of words he was told to say, he told us. We know about his transformation from a confused aide who was over-his-head in bribery to a primed and ready state’s witness because he told us from the stand. But before we go to the obvious molding of Nick Bailey, it is necessary to see how Bailey fits into the above-described climate.

The prosecution has a distinct advantage because juries find it hard to understand the intricacies necessary to extract a quid pro quo from a lobbying maneuver. It is not the kind of hard evidence the general public readily recognizes or understands. There are no fingerprints. There is no gun to wave around. And there is a general misunderstanding of what the nature of these charges really is. So what happens if a prosecution team puts a witness on the stand who doesn’t truly understand what he saw? And then he is asked to tell the jury what happened? This is Nick Bailey. He didn’t understand the difference between bribery and lobbying any better than the general public, except for one thing. He did understand that if he “saw” what he was asked to see, then most of the charges against him would go away. (In spite of confessing to numerous charges of bribery, Bailey would later spend less than a year in jail.) A witness of this nature can be and will be shaped by the nature of the questions. But a reader of this article does not have to take my word for it, does not have to rely solely on the impressions of someone who was in the courtroom for every day of the two month trial, we can read Nick Bailey’s own words.

In reviewing Mr. Bailey’s understanding of what transpired between himself and the governor, relative to Richard Scrushy, it is worth noting that Bailey always termed the money Scrushy gave to the education foundation as Scrushy’s “commitment.” Even on the stand, even when his own prison sentence was dangling in the balance, dependant on what he had to say about Siegelman and Scrushy, he still used the language that would indicate that, at the time, Bailey thought this was a typical campaign contribution. When donors are signed up to give sums of money to political campaigns or to churches, the speculative income is always termed as the donor’s “commitment.” Bailey had trouble calling this money a bribe even when he was invited to do so, and Bailey would also confirm that an open and documented discussion took place that targeted Scrushy and other big businessman for making donations to the education foundation.

Bailey not only saw this as a legitimate donation, but after the feds began to question him about what happened between Scrushy and Siegelman, it is clear that just like the general public, Bailey was confused about how the whole thing works and about what is legal or illegal. He may have also been confused about why the feds were suddenly asking him about Richard Scrushy, during interviews in June, 2003. After all, they had already been talking to him for a couple of years about his own criminal behavior and had made frequent—not very successful probes—to find out if this criminal activity extended into the governor’s office. And Bailey had already told them everything he knew, all about the bribes he had taken and all about Lanny Young, but he apparently never mentioned that he thought Scrushy was involved in any illegal activities, concerning the governor. But yet, suddenly Scrushy’s name came up and suddenly the feds wanted to know all about Scrushy’s contacts with the administration. Perhaps it was just a coincidence that Scrushy’s name came up in the middle of this ongoing dialog with Bailey, in June of 2003, just three months after the feds swooped in on HealthSouth and Scrushy’s name entered the lexicon of corporate greed. Bailey was a confused and scared public official who had been telling his handlers as much as he could, and now he federal agents were asking him specifically about Scrushy, the guy everyone thought had caused the HealthSouth mess, and the guy nearly everyone would eventually think got away with something, in Birmingham. It is clear from Bailey’s testimony, that the agents could have asked their hopeful cooperating witness about any member of the CON board, and he would have willingly pointed a finger at any member of the board, which was entirely made up of people who had either contributed to political campaigns or whose organizations had contributed to campaigns.

Bailey told Siegelman attorney David McDonald that the governor could not have appointed Scrushy to be the chairman of the CON board—so he would have the most power—because he had already committed the chairmanship to someone else, who represented an organization that just happened to have given donations equal to twice what Scrushy had given. By Bailey’s own admission, it doesn’t appear that Scrushy got much of a bang for his “bribe.”

McDonald: Your educated guess is Governor Siegelman could not have appointed Richard Scrushy to head the CON board after getting $500,000 because he may have already committed to Margie Sellers after the—
Bailey: I didn’t say he couldn’t. I said he didn’t.
McDonald: He didn’t. Right. Well, is that because maybe Margie Sellers paid him a million dollars to be the – head of the CON Board?
Bailey: Let me see. Who was Margie Sellers representing? The Nursing Home Association?
McDonald: Yes.
Bailey: It could have been more than that, yes.

The helpful distinction Bailey offered the defense counsel is significant because it demonstrates that he was well aware that it was within the governor’s powers to give the chairmanship of the CON Board to anyone that he wished. But he didn’t. Bailey would later say that he didn’t know if Margie Sellers had bought her way onto the board, but it was obvious that he felt that for $500,000, a donor could be the vice chairman of the board, and for $1,000,000 a donor would be given the chair. But one thing is certain, if Margie Sellers were being targeted by the government in the way that Richard Scrushy was, and that if the agents or grand jury had asked this cooperating witness about Margie Sellers, he would have said that her organization paid $1,000,000 for to buy chairmanship of the CON board. It is clear that Nick Bailey made the perfect nexus to link the government’s case to the foggy landscape hovering over the fuzzy line they were using to try to win convictions of Siegelman and Scrushy.

This point becomes even clearer when McDonald asked Bailey this question:

McDonald: Okay. Well, I want to make a list of all the CON Board member that have or could have bought their way onto the board. Can we do that?
Bailey: I suppose you could list all nine of them.

The one that was going to be indicted, arrested, convicted and sent to prison just depended on which one Bailey was being asked questions about.

Looking at the possibility that Bailey was unduly influenced by the prosecution, and going beyond the general impressions that were given at trial, there is some insight in the transcript. The prosecution’s sometimes over-the-top theatrics generated some memorable moments in the trial (as we shall see) but a certain confrontation between Scrushy attorney Art Leach and Nick Bailey was one of the enduring images of the trial.

Under questioning, Leach was examining the fact that Bailey’s story appeared to be changing and evolving through numerous successive FBI interviews.

Leach: All right. And in terms of these events, would you testify to this jury that your memory was better on June 30 of 2003 or better today? [May 5, 2006] Bailey: My recollection of these events are better now than they were then, Mr. Leach.
Leach: Sir?
Bailey: My recollection of the events around the delivery of this check is better now than it was then.

Nick Bailey actually told Art Leach that his memory improved over time, that he remembered things better as time went by. When asked by the prosecution how he came to change his mind about critical events in the case, Bailey would say that he was “reevaluating his memory” and looking at documents helpfully provided to him by his agent-handlers. Since Nick Bailey, who never actually saw a bribe take place, was still the government’s only witness to the affair via a snippet of a conversation he was alleged to have had, is it fair, right or just by the stringent guidelines set forth by our founders, to put someone in jail on the word of a cooperating witness whose memory is improving over time. And following this gossamer link, it gets even better.

The Bailey Nexus: 31 words to prison

If we seek the truth, if we seek to establish the supreme rule of law and to cleanse our society by prosecuting and punishing criminals in accordance with both the mandates and protection of the Constitution, then it should always be our goal to make sure that our laws are applied and enforced fairly, that the prosecutors, the defense attorneys, the judges and the citizen jurors work together to make every effort to ensure that this important balance is preserved. If we seek the truth, then in a better world, truth and fairness should take priority over what might be possible, what might be winnable, or what might slip through the cracks of a very good system of justice. That’s how it would be if we truly sought the truth.

So in the matter at hand, with a public primed to view the presence of any money in the political process as inherently wrong, with the public clearly mistrustful of politicians, with the public not having an understanding of the role of lobbying in politics and viewing the practice as essentially shady if not criminal, with the public viewing the people at the defense table with jaded eyes primed by years of negative press; and with misunderstood charges steeped in legalese that few members of the lay public could hope to understand, with a cooperating witness who’s obviously been coached to the point that he declares that his memory has been improving over time, and with a criminal witness who himself demonstrates that he has a fuzzy knowledge of just what it is he has seen or is supposed to have seen, it would seem that it should be an absolute imperative that the evidence of corruption must be clear and convincing. There should be eyewitnesses. There should be unequivocal evidence gleaned from statements or documents that pointed to an easily understood quid pro quo. But there wasn’t. Not at all.

Instead of unequivocal evidence to mitigate all of these factors and to show that a crime actually was committed in spite of the many reasons that seemed to say that justice is on wobbly, unsteady ground, there was a second-hand conversation that amounted to thirty-one words, and it was these thirty-one words, replete with multiple interpretations, that sent the defendants to prison for over six years a piece.

The entire conversation, as reported by Nick Bailey seven years after the fact, is reprinted here:

After Siegelman and Scrushy met privately, Nick Bailey said that Siegelman emerged from his office holding a check that he said was for $250,000. And they had the following exchange.

Siegelman: He’s half way there.
Bailey: What in the world is he going to want for that?
Siegelman: The C-O-N board.
Bailey: I wouldn’t think that would be a problem would it.
Siegelman: I wouldn’t think so.
That’s it. That’s all we have. Thirty-one words to prison. Before even considering all of the factors listed above, it appears that this thirty-one word downward slope to prison is nebulous at best. After reviewing the climate and going over the various extra-legal factors, it can only appear that in spite of the best efforts of the prosecutors, the judge, the defense attorneys and the jury, justice has failed this time.

Bailey’s reconstructed conversation is clearly open to multiple interpretations, and the way our system of justice is designed, the jury is tasked with sorting this out and coming up with their best shot. But with all of these factors in play, wasn’t a directed pre-determined interpretation guaranteed? So on the one hand, it could be argued that this is precisely the way Justice is supposed to work, but on the other hand, it could easily be argued that this is precisely the way Justice is not supposed to work. And doubt is supposed to win. Always.

Consider this interpretation: Siegelman hoped for a very large contribution from Scrushy. Documentary evidence confirms that this was indeed true, and that Scrushy, along with other businessmen, was targeted for big donations. Witnesses also confirmed that Scrushy was urged to meet with Siegelman to patch fences. So Siegelman receives a check and he is feeling good, as any fund raiser would feel after landing a large commitment. He knows Scrushy has committed $500,000 or feels confident that he will be able to get that much, so he tells his young aide, in a jovial mood, “He’s half way there.”

Bailey asks what he’s going to want for that. If that is really exactly what Bailey said, after his memory had improved his recollection of this encounter over the course of seven years, there is the real possibility that Siegelman ignored the form of the question or even misheard it (after all, it is only ten words) and he told Bailey what he was already planning to do with Scrushy, regardless of any donation he received. “I’m going to put him on the CON Board.” There is evidence for this. Scrushy’s name was on short lists that were being compiled by Siegelman staffers who were going to be appointed to various positions. It is well known, in Alabama, that Scrushy’s place on that board was not at all unusual or undeserving. He was the CEO of the largest Healthcare provider in Alabama (and it was four years before the story of the fraud broke) and he had been named to serve on the CON board by three previous governors. Did Scrushy the businessman hope that his donation would get him some favorable treatment by the Siegelman administration, and was Siegelman more inclined to treat Scrushy favorably with a large campaign donation in hand? Probably. Perhaps certainly. And most certainly, George Bush and the over one hundred large donors who received government jobs did as well. But when we consider for a moment the background of the trial, and then if we squint or stare at those thirty-one words, can we clearly see a quid pro quo? Or do we only see something we can’t be sure of? Sure enough to send men to prison? Or emerging from the mist, do we only see a miscarriage of justice?

How did the appellate court see it? In order to avoid the notion that this article omits salient facts, the view of the 11th Circuit Court, about this matter, is as follows:

To the extent that the jury’s verdict rests upon their evaluations of the credibility of individual witnesses, and the reasonable inferences to be drawn from that testimony, we owe deference to those decisions. In our system, the jury decides what the facts are, by listening to the witnesses and making judgments about whom to believe. This they have done, and, though invited to do so, we shall not substitute our judgment for theirs…

Inferring actors’ states of mind from the circumstances surrounding their conversation, from their actions, and from their words spoken at the time is precisely the province of the jury. As we noted above, “the [jury] is quite capable of deciding the intent with which words were spoken or actions taken as well as the reasonable construction given to them by the official and the payor.” See Evans, 504 U.S. at 274 (Kennedy, J., concurring). In making these judgments, jurors are presumed to use their common sense and are free to choose among reasonable constructions of the evidence. [Appellate Court decision March 6, 2009]

As indicated throughout this document, the appellate court adopted the general stance that our jury system is capable of sifting through competing arguments and sorting things out, and it is clear that the 11th Circuit, guided by precedence and The Constitution, was not tasked with evaluating the whole climate and making the extra-legal determination that although this is the way the justice system is supposed to work, in light of all of these other factors, this time, in this particular case, justice failed. It was a conclusion the 11th Circuit Court of Appeals could not have made and they were not asked to. This case fell through the cracks because of extraordinary issues that were neither the 11th Circuit’s concern nor their job.

The Appellate Court also cited a Supreme Court decision, quoting Justice Kennedy:

The criminal law in the usual course concerns itself with motives and consequences, not formalities. And the [jury] is quite capable of deciding the intent with which words were spoken or actions taken as well as the reasonable construction given to them by the official and the payor.

And the 11th Circuit used this cited case as the basis for this portion of their opinion:

Since the agreement is for some specific action or inaction, the agreement must be explicit, but there is no requirement that it be express. To hold otherwise, as Justice Kennedy noted in Evans, would allow defendants to escape criminal liability through “knowing winks and nods.”

As stated previously, this article is not concerned with either the political issues or with the finer points of the law. Legal and political issues will remain the province of the lawyers and politicians. But instead, this article is concerned with looking at the sensibilities behind what has happened, and the possibility that even with the finest minds in the legal sphere sorting out the case, justice has somehow failed. The two passages above are problematic in their application to the Siegelman-Scrushy case because both snippets pre-suppose that someone actually saw the official and the payor commit the act in question. Neither of these legal applications appears to cover the situation where a third party cooperating witness is relaying his memory of a short conversation that may or may not refer to an explicit action. In either case, the “knowing winks and nods” assessment is also problematic because if it is the only extant evidence that we have to offer as proof of this tricky, misunderstood, juror-obtuse crime, then by the tenants of our Constitution, the “knowing wink” should never rise to the level of putting someone in prison on the basis of that act alone. It only makes sense that some evidence must be introduced that would clarify beyond a reasonable doubt that a “nod or wink” or some language meant to consummate a deal actually took place between the official and the payor. Or at the very least, it seems that evidence must be introduced that would unequivocally clarify what was meant by that “nod or wink.” This case has neither.

The appellate court went on to say that there were some two-off or three-off corroborations for Bailey’s one-off rendition of the thirty-one words to prison. But as we’ll see, this corroboration, meant to bolster a weak case, was in itself problematic, and not all that helpful. It does not really provide the safety net that we might have hoped for, the extra details that could serve to mitigate the many adverse factors, and would have provided some comfort that justice was served.

The center could not hold: Straining to hear words from the edge of the storm

The heart of the case is behind us. The Nick Bailey exchange was the core of the evidence that was used to convict Don Siegelman and Richard Scrushy. But some elements were brought in as “corroborating” factors to bolster and shore up this weak framework, and rather than being the hoped for bulwarks, the beams that would shore up Bailey’s tenuous rendition, the effect of this supporting evidence was to further pump fog into the trial scenario, making it even more difficult for justice to prevail.

First, there was the matter of Eric Hanson, conveniently named as a co-conspirator so his statements, as reported by two yet un-sentenced cooperating witnesses could pass the usual hearsay filters. Hanson’s unindicted co-conspirator status was also a deft ploy that allowed the prosecutors to use his words, as reported by Nick Bailey, without actually having to call Hanson to the stand. To do this would have exposed something else that doesn’t come out of the trial transcript. Hanson was not only one of HealthSouth’s primary lobbyists, but he was also a good friend of both Siegelman and Scrushy. The government’s juxtaposition of the talk emanating from Eric Hanson, a good friend of both defendants, as the “evidence” that is supposed to corroborate Bailey’s thirty-one word rendition, was itself a maneuver that could not be underestimated. Calling Hanson a co-conspirator had the salutary affect of suitably scaring Hanson which put him out of reach as a witness for the defense. He could have told the court about the nature of his talk; he could have told the court that it was all business as usual and that there were no promises or demands, but as it played out, Hanson said that he had a death in the family so he would not honor the defense’s subpoena, and he would be unable to testify.

Why didn’t Scrushy and Siegelman send the US Marshalls out to compel Hanson to testify? For the answer, we need to look at the role of Alabama and how Southern Traditions played out in this matter, and how the prosecution adroitly used these deeply entrenched values as yet another extra-legal factor that had the cumulative effect of leading the legal process astray. After Scrushy and Siegelman were convicted, in a fit of hyperbole, Scrushy attorney Terry Butts, himself a southern lawyer and a one-time Alabama Supreme Court Justice, was quoted as saying: “This is the worst miscarriage of justice since General Sherman burned Atlanta.” At first glance, this seemed like an over-the-top assessment blurted out by a defeated attorney. However, Terry Butts was not elevating the Scrushy-Siegelman situation to make a direct comparison to the broad scope of the Civil War, he was instead invoking what every southerner would instantly recognize as the perceived violation of honor, and in the hearts and minds of many southerners, the Civil War—to this day—was much more about honor than it was about slavery. The character of the Southern Gentleman and the code of honor they adhere to is deeply ingrained in southern society, and it is centered around the values of faith, loyalty and trust. Terry Butts was saying that what happened to Scrushy in Montgomery was a violation of the faith and trust we have in our legal system, and perhaps that it was once again tramped on by a government that does not cherish these principles as strongly. It is likely that the prosecutors knew that Siegelman and Scrushy, both native Alabamians, would not violate these values of faith and trust, and expose their friend to the maelstrom that had descended upon the two of them, even if it meant saving themselves, even if it meant compelling the one witness who could debunk the prosecution’s theory to come and testify. It was reckless for the prosecution to name a man they knew to be innocent as a co-conspirator, but it was yet another deft ploy in insuring the eventual extra-legal result.

Hanson is a lobbyist and a Democratic fundraiser, which as previously discussed, already puts him well within two unpopular categories of people—by popular public perception—those who are tasked with finding and maintaining a flow of money into politics and those who are paid to manipulate politically obtainable goals by any means available to them. Every election cycle, the candidates promise their constituents that one of their goals will be to regulate campaign financing and to get the lobbyists out of the political process. But more specifically, Hanson’s stock in trade, like Lanny Young, was to convince people that he could get things done for his client. If a company wanted to receive a certain honor, Hanson could make that happen. If a company wanted to have an employee named to a regulatory board, Hanson could make that happen. His livelihood depended on his clients thinking that he was the guy that could make things happen, even if like Lanny Young, he was more adept at reading which way the wind blows and claiming credit for it. And he was a big talker. All across the country, political parlors and backrooms where deals are done are filled with big talkers, guys that enjoy their position as supposed puppetmasters behind the political process. This was Eric Hanson.

Let’s take a look at some of Eric Hanson’s talk. Checking the Internet archives, there is a piece of text that once was on the website for US Strategies, the company that Eric Hanson is the president of. It is under the heading “Some examples of what we accomplish,” and reads as follows:

• Multiple Certificates of Need (CONs), which are state and local health planning approvals for new health facilities and services, are granted to various clients.

• A direct healthcare and rehabilitative services provider is awarded positions on JCJHO panels, insuring input on critical issues. They are successful with last minute collections and Medicare reimbursement issues, including coding, procedures and activities.

Eric Hanson had a well documented proclivity for telling people that he could get his clients on regulatory boards. That’s what lobbyists do. Of course he would say this about the CEO of HealthSouth, which was then one of his primary clients. Hanson’s bragging that he got Scrushy on a CON Board was nothing out of the ordinary and nothing he wasn’t already doing in a very public forum, but it still took Nick Bailey’s thirty-one words to send Scrushy and Siegelman to prison. And if Hanson was a friend of both Scrushy and Siegelman, doesn’t it make sense, almost too much sense, that he would tell Siegelman’s people that his friend and client wanted to be on the CON Board; and as a fundraiser and friend of Siegelman, doesn’t it make almost too much sense that Hanson would tell his friend Scrushy’s people that he would like Richard to donate to Siegelman’s educational initiative? Since the prosecution, by way of their ploy, prevented this witness from being cross-examined, the truth will remain hidden, but there was no evidence that either Siegelman or Scrushy were directing or ordering any private conversations Hanson might have had. Far from bolstering Bailey’s testimony or making those thirty-one words more clear, this additional “evidence” only shows that if we can throw more lobbyists into the mix, there is an even better chance that justice will fail.

And there is the matter of Mike Martin, the only cooperating witness to make an appearance in both the Scrushy and the Siegelman-Scrushy trials. At the time of the Siegelman-Scrushy trial, Martin had still not received his final sentence for his considerable role in the HealthSouth fraud. The DOJ had twice appealed his light sentence and he was awaiting his third and final sentence. Martin came to HealthSouth from the banking community and his role in the fraud can not be underestimated. Whereas some of the HealthSouth conspirators had a background with the auditing firm, which allowed them to know how to “hide” small amounts of money across many accounts, Martin knew how the financial community worked, and so he was able to help HealthSouth hide or scrub millions of bogus dollars within the structure of deals and acquisitions. And when the feds came to knock on his door, it had been at least a couple of years since he left HealthSouth, and he had likely thought that he had taken his money and gotten away with it. So when he was caught and cornered, Martin was more than eager to tell stories. His eagerness and willingness to say anything and everything set him apart from the other cooperating witnesses at the HealthSouth trial. It was clear that he knew that helping the feds nail Scrushy was his ticket to freedom and he was going to try to do it with gusto. Oddly enough, and it is worth noting in the topical light of what is currently happening in the banking industry, Martin told some of HealthSouth’s outside financial people about what was going on in the fraud. And although to this day, the DOJ and SEC claims they adequately investigated the banking connection to HealthSouth, documents have shown that Martin stated more than once that some of the bankers knew what was going on in HealthSouth. But there was money to make and they went along with it. One of those bankers was Bill McGahan. Remember that name.

One of the differences between the trial in Montgomery, and Scrushy’s previous trial, is that in Birmingham, Scrushy’s attorneys had won the right to have witnesses’ testimony pre-screened by the judge in order to prevent legally inadmissible damning testimony. In the Siegelman-Scrushy trial, Judge Fuller used his discretion to allow the raw testimony to be heard and deferred to the attorney’s use of objections, in order to control the flow of information. (Fuller then further restricted the attorney’s ability to raise objections because of the multiple defendant format.) This approach became very important during the testimony of the always volatile Mike Martin. In the pretrial motions, the Scrushy defense had successfully had the court issue an order that no information about the Birmingham fraud trial should enter the courtroom. It may be more than a little likely that the jurors couldn’t help but to know about this major local event anyway, and couldn’t hope to not harbor at least some contempt for defendant Scrushy (at least 80% of them, anyway) but during Martin’s testimony, the doors were going to blow down and Scrushy’s notoriety was going to come rushing into the courtroom. Scrushy attorney Terry Butts asked Martin why he left HealthSouth—hoping to explore Martin’s explosive personality—and Martin blurted out: “Because I couldn’t get Scrushy to quit doing fraud.” Objection. Long sidebar. Scrushy’s attorney rephrased his previous question, and Martin again reiterated that he left “Because I couldn’t get Scrushy to give up the fraud.” In the stunned courtroom, it really didn’t matter what Martin said after that. His alleged role in the scheme was minimal so it is plausible to assume that he had already done what he had been brought into the courtroom to do. At the time, he was still un-sentenced for his HealthSouth role and he still had stories that he was determined to tell. In the Montgomery courtroom, one hundred miles and a couple of years from Birmingham, he was able to bring in his opinion of Richard Scrushy, but Martin didn’t mention that he tried to beat up the guy who tried to tell Scrushy about HealthSouth’s cash shortfall. Why would he do that? If he was so worked up about the fraud that he left HealthSouth, why would he try to beat up the guy who threatened to expose it to both Richard Scrushy and possibly the outside world? Why wouldn’t he have seen him as an ally and help him?

During the trial, Martin testified that Scrushy had told him that they had to raise some money for Siegelman’s educational initiative in order to have some influence in the governor’s administration. That sounds plausible. Over one hundred holders of Bush-era government jobs and a few hundred more lobbyists would probably agree. He also testified that Scrushy said that he did not want it to be publicly known that HealthSouth was supporting Siegelman’s initiative because it was to be fueled by a state lottery. To understand the impact and plausibility of this statement, it is necessary to understand something about the Bible Belt and to once again consider the role Alabama played in this unfolding drama. The educational lottery was an extremely controversial issue which was narrowly defeated in the polls. Most churches and many community leaders were allied against the lottery as they saw it as a gateway to the proliferation of gambling. Lotteries and casino gambling had sprung up in many of the southern states, and this coalition was determined to prevent gambling from penetrating into Alabama. It is not at all unusual for corporations to indirectly support various causes to avoid alienating large segments of their customer populations.

So in order to facilitate this donation, Mike Martin who was knee deep in the fraud, made some calls. Who did he call? His good friend Bill McGahan. It doesn’t come up in the transcripts, and if it comes up at all in media accounts, it is only mentioned in passing, but Bill McGahan was a good friend of Mike Martin.

…it would just look bad if HealthSouth made a direct contribution to the lottery, so we needed to ask – he instructed me in particular to ask our investment banker, Bill McGahan, from [the Swiss bank] UBS, to make the contribution.

Is it at all suspicious, strange, odd, funny, or unusual that Scrushy would tell Martin to call his good friend, associate and cohort Bill McGahan, to help them raise money? Martin would go on to tell the court that he called McGahan every day about this donation, but since he was one of HealthSouth’s primary connections in the banking community and was also good friends with CFO Mike Martin, it is more than likely that Martin spoke to the banker on a daily basis anyway. And there’s more. During the fraud trial and the subsequent SEC hearings, it was learned that Martin had told McGahan about what was going on at HealthSouth. With both Martin and McGahan having good reasons to gingerly tell stories about HealthSouth and Richard Scrushy, in the end it does not appear that this supporting “evidence” was anything more than the normal course of business for Martin. His role in the trial was more about throwing his verbal bucket of paint by way of his blurted out fraud allegations than it was about bolstering or propping up Bailey’s thirty-one words to prison, and like Bailey, it was painfully apparent that criminality was established only through the form of the questions via who Martin was being asked about.

Hanson and Martin. They were the beams used to shore up Bailey’s thirty-one words, the corroboration that was supposed to clarify and give substance to what Bailey was supposed to have seen. Hanson and Martin were supposed to convince us that justice prevailed, but it ended up being kicked back to Bailey so we have to look at those words again, and there is the overwhelming feeling that even if the i’s were dotted and t’s were crossed in the hundreds of legal briefs that have been filed since the beginning of this matter, it didn’t add up to justice. It is the best legal system in the world, but this time, justice failed.

Justice Obstructed

Let’s probe deeper into our sensibilities. In a realm of law that is as clear as mud, Siegelman was convicted on a single charge that was not related to his bribery conviction. The circumstances surrounding the sale of a motorcycle resulted in an obstruction of justice charge. And again let’s set aside the well-crafted legal arguments of DOJ professional attorneys and a raft of defense lawyers so numerous they overpopulated the chairs set aside for them in the well of the court. Justification for this set-aside departure can be found in the legal system itself, where the various subsections of the obstruction statutes have caused splits and conflicts within the judicial circuits, and have had numerous Supreme Court challenges. But recently and more specifically, obstruction charges have taken on an extra-legal role in many courtrooms which is worth scrutiny and might be cause for some alarm. Obstruction of justice charges have become popular tack-on charges to slip into corruption or white collar business trials. Whereas the juries may not understand or be able to process the obtuse legalese of complicated business or political issues, they can grasp onto these safety-valve charges that are inserted to make sure the prosecution team gains a conviction. So at the same time we venerate the jury system as sacrosanct, saying that our peers should always be the final arbiters of justice, the prosecutors have begun to hedge their bets and have employed a tactic to ensure a conviction when they can not adequately trust the evidence or the abilities of the jury. And the beauty of it, from the perspective of committed prosecutors, is that this strategy is extremely hard to assail by the defense because the prosecutors can easily manipulate the jury system with the blessing of our statutes and of the higher courts. It could be argued that if we have to use a few tricks to put the bad guys away—since we can’t trust the juries to understand overly complex issues—then this helps to ensure that the system works even when the prosecutors can not convince juries to convict defendants on less-accessible grounds. But doesn’t this argument run exactly contrary to the foundations of our system, where the rights of the individual—no matter what the nature of public opinion—are to be protected and that defendants can only be convicted by the fair presentation of evidence at a trial?

A strong and memorable image from the Don Siegelman trial, one that didn’t show up in the media much or wouldn’t jump out of the transcripts, was of DOJ career prosecutor Stephen Feaga endlessly waving a check in front of bank clerks and other people who were completely unconnected from the events of the trial, people who were called to the stand merely to identify the check as one that had come from their bank or institution, and Feaga would ask them what opinion the witness would have if he knew the check was used to pay off a bribe, a fact that was yet to be determined and that the poor clerk had absolutely no knowledge of. What Feaga did, although embarking on an ethically questionable path, was perfectly legal and well within the available tools of a prosecutor setting out to win a conviction, and it was within the confines of legal boundaries, leaving Judge Fuller free to use his judicial discretion to overrule numerous objections to the technique. The cumulative effect of the spectacle allowed Mr. Feaga to regale the jury with a closing-argument style statement repeated with pile-driver regularity that affirmatively declared the thing the evidence was supposed to prove. The fruit of the prosecutor’s efforts was readily apparent when the obstruction charge was the only non-Scrushy charge left standing. And the Appellate court, which only had to rule on applicable statute, had neither the power nor the task to rule on a technique that fell within a certain legal framework but may have been used to overtly convict an individual of a crime where there was plentiful and unavoidable doubt.

So beginning with the fact that obstruction of justice is a nebulous crime with an unsteady tradition in American legal jurisprudence, let’s factor in two more components of the Siegelman case. Even if Siegelman should not have written the checks which led to his obstruction conviction, and even if it was the result of some furtive behavior because of the many questions that were being asked within the context of a political and media-driven firestorm, the fact remains that his primary accusers—themselves confessed and convicted criminals—had ample reasons to tell stories. Indeed the testimony of Bailey and Young indicate that whatever happened concerning the motorcycle was something that was hatched between the two of them. But that’s not the half of it. Don Siegelman was acquitted of twenty-two charges in his corruption trial—every charge that did not involve Richard Scrushy—and no matter what impression Steven Feaga and the prosecution was able to impart into the minds of the jury, the jury did not believe that there was enough evidence to support any claims that Lanny Young bribed Don Siegelman. There was no evidence—at least none that was substantiated beyond a reasonable doubt—that the “crime” in which the motorcycle Siegelman was accused of selling to cover up actually existed. And let’s keep factoring in the high probability that Lanny Young and Nick Bailey were manipulated and used by the prosecution in an attempt to convict Don Siegelman on very thin evidence. We already know that Bailey was manipulated in an attempt to convict Scrushy and Siegelman on other charges. By statute, we can only make the obstruction of justice charge go in one direction; it can only be used to criminalize a defendant’s attempt to manipulate a witness to avoid prosecution. In this case, in the matter of Don Siegelman and Richard Scrushy, we need to take a hard look at this. It seems very possible, if not even likely, that there was an obstruction of justice, but that it was because the witnesses were manipulated by the government to win a prosecution. And in any case, regardless of feelings toward Siegelman or Scrushy, there is no way that this could possibly make the citizenry comfortable that justice was served in accordance with the ardent wishes, dreams and hopes of our founding fathers. It is a good system but justice failed.

When Justice Fails

On top of the circumstances and sensibilities outlined in this article, there are also legal and political arguments that concern themselves with the nature and origins of the matter of Don Siegelman and Richard Scrushy. Some of them may have merit in accordance with their respective disciplines, and the meritorious threads would give additional credence to the notion that something went awry in Montgomery, Alabama. But even if none of them pan out, if it turns out there was no untoward political conspiracy, if the legal arguments of the case arguably fit within the narrow limits of the law and judicial discretion, something went wrong that is worthy of being closely examined with an eye cast on the continual fine tuning of our system of justice, a system that is truly the envy of the world. In order to be the shining beacon our judiciary has always been and has always aspired to be, we need to strive to find a way to adjust our legal framework so it remains strong enough to adequately address changes in our society and the complexities of the 21st century, and we need to be able to invoke corrective measures when individuals fall through the cracks of the system. This is what happens when justice fails, and the challenge for each of us is to set aside what we might believe or think we know about Don Siegelman and Richard Scrushy; we need to set aside our politics—whether we happen to be conservative or liberal—we need to shed the thin skin of our personal feelings, and we need to close our eyes as tightly as we can until we are as blind as Lady Justice herself, and think about the various issues that came together and were outlined in this document, and think about what happened in Montgomery, and think about the times in your life when you did some of the things that any of the actors of this story have done—supported candidates, bragged about things you could do, told little stories to get better treatment—and then try to really see a better system of justice, a place where we can fix our mistakes and continue to build a stronger nation.

It is a great system in a great country, but this time, justice failed.

© 2009 – 2010, Glynn Wilson. All rights reserved.

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