Harris Corporation Acquittal Briefing and Hearing

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WILSON, SONSINI, GOODRICH & ROSATI
ROBERT P. FELDMAN
Two Palo Alto Square, Suite 900
Palo Alto, California 94306
Telephone: (415) 493-9300
McKENNA & CUNEO
MICHAEL L. FAYAD
One Market Plaza, Suite 2700
Steuart Street Tower
San Francisco, California 94105
Telephone: (415) 543-0204
Attorneys for Defendant
HARRIS CORPORATION
9 KEKER & BROCKETT
JEFFREY R. CHANIN
10 JULIA BOAZ-COOPER
710 Sansome Street
11 San Francisco, California 94111-1704
Telephone: (415) 391-5400
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Attorneys for Defendant
13 JOHN D. IACOBUCCI
14 COBLENTZ, CAHEN, McCABE & BREYER
CHARLES R. BREYER
15 JEFFREY COGEN
222 Kearny Street, 7th Floor
16 San Francisco, California 94108
Telephone: (415) 391-4800
17
Attorneys for Defendant
18 RONALD L. SCHULTZ
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19 UNITED STATES DISTRICT COURT
20 FOR THE NORTHERN DISTRICT OF CALIFORNIA
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UNITED STATES OF AMERICA, )
)
Plaintiff, )
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v. )
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HARRIS CORPORATION, JOHN p. )
IACOBUCCI, and RONALD L. SCHULTZ, )
)
Defendants. )
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MOTION FOR JUDGMENT OF ACQUITTAL A ~ D
No. CR 90 0456 CAL
MOTION FOR JUDGMENT OF
ACQUITTAL AND INCORPORATED
MEMORANDUM
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TABLE OF CONTENTS
TABLE OF CASES AND AUTHORITIES
INTRODUCTION
I. ARGUMENT
II.
NO RATIONAL JUROR COULD FIND DEFENDANTS, AS
CHARGED IN COUNT FOUR, GUILTY OF CORRUPTLY
AUTHORIZING A BRIBE ON MAY 1, 1989
NO RATIONAL JUROR COULD FIND DEFENDANTS GUILTY
OF "FALSIFICATION" OF RECORDS WHERE THE RECORDS
THEMSELVES WERE IN FACT TRUE
III. NO RATIONAL JUROR COULD FIND DEFENDANTS GUILTY
OF CONSPIRING TO FALSIFY HARRIS' RECORDS OR
"FALSIFICATION" OF RECORDS WHERE THE GOVERNMENT'S
EVIDENCE SHOWS THAT DEFENDANTS MERELY FAILED TO
DISCLOSE; A FAILURE TO DISCLOSE IS NOT A CRIME
UNDER 15 U.S.C. § 78m(b)(4) AND (5)
A. 15 U.S.C. § 78m(b)(4) And (5) as Amended in
1988 Is Unambiguous on its Face
B. 15 U.S.C. § 78m(b)(4) And (5) is Unambiguous
with Reference to Established Usage by
Congress and Consistent Judicial
Interpretation
C. Any Arguable Ambiguity in the Meaning of
15 U.S.C. § 78m(b)(4) and (5) Must be
Construed in Favor of The Defendants
CONCLUSION
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
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TABLE OF CASES AND AUTHORITIES
CASE
Bronston v. United States
409 U.S. 352 (1973)
Crandon v. United States
u.S. ,110 S.ct. 997 (1990)
In re Stringer
847 F.2d 549 (9th Cir. 1988)
Metheany v. United States
390 F.2d 559 (9th Cir. 1968)
united States v. Adler
380 F.2d 917 (2nd Cir. 1967)
United States v. Attick
12 649 F.2d 61 (1st Cir. 1981)
13 United States v. Bass
404 U.S. 336 (1971)
14
United States v. Brewster
15 506 F.2d 62 (D.C.Cir. 1974)
16 united States v. Cloud
872 F.2d 846 (9th Cir. 1989)
17
united States v. Cook
18 497 F.2d 753 (9th Cir. 1973)
19 United States v. Cowley
720 F.2d 1037 (9th Cir. 1983)
20
United States v. Diogo
21
320 F.2d 898 (2nd Cir. 1963)
22
united States v. Dunlop
573 F.2d 1092 (9th Cir. 1978)
23
united States v. Erickson
24
601 F.2d 296 (7th Cir. 1979)
25
United States v. Forrestt
623 F.2d 1107 (5th Cir. 1980)
26
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
CASE (con't)
PAGE
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United States v.
Gahagan
881 F.2d 1380
(6th Cir. 1989)
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united States v.
Howard
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855 F.2d 832 (11th Cir. 1988)
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united States v.
Irwin
654 F.2d 671 (10th Cir. 1981)
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united States v. Johnson
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621 F.2d 1073 (lOth Cir. 1980)
2
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United States v. Lange
528 F.2d 1280 (5th Cir. 1976)
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.9
united States v. Loya
10 807 F.2d 1483 (9th Cir. 1987)
1
11 united States v.
Marabelles
724 F.2d 1374
(9th Cir. 1984)
9
12
united States v. Marley
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632 F.2d 978 (2nd Cir. 1980)
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14 united States v.
Overmyer
867 F.2d 937 (6th Cir. 1989)
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united states v. Quijada
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588 F.2d 1253
(9th Cir. 1978)
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united States v.
Rivera-Sola
713 F.2d 866
(1st Cir. 1983)
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united States v.
Rovetuso
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768 F.2d 809 (7th Cir. 1985)
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united States v.
Strand
574 F.2d 993
(9th Cir. 1978)
2, 5
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United States v.
Whitaker
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848 F.2d 914
(8th Cir. 1988)
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PAGE
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UNITED STATES CODES
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7 U.S.C.
§ 1373
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7 U.S.C.
§ 1642
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IS U.S.C. § 78m(b)(2)
11, 12,
IS
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IS U.S.C. § 7 8m (b) ( 4 )
10-13,
lS-17
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IS U.S.C. § 78m(b)(S)
10-16
IS U.S.C.
§ 78dd-l(a).
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IS U.S.C. § 78dd-l(a) (3) (A)
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IS U.S.C. § 78dd-l(a) (3) (A) (i).
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IS U.S.C. § 80a-33
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16 U.S.C. § 916e
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18 U.S.C. § lS2
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18 U.S.C. § 1001
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18 U.S.C. § ISIS
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18 U.S.C. § 1621
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21 U.S.C. § 846
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26 U.S.C. § S762(a)(2)
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26 U.S.C. § S763(b)
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4S U.S.C. § 438(e)
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47 U.S.C. § 220(e)
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49 U.S.C. § 10S29(f)
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49 U.S.C. § 11909(a)
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OTHER AUTHORITY
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Devitt & Blackmar, Federal Jury Practice & Instructions,
17 Instruction § 16.02 (3rd ed. 1977 and Supp. 1990) 8
18 H.R. Rep. No. 640, 9Sth Congress, 1st Session, 8 (1977) 2
19 Manual of Model Jury Instructions for the Ninth Circuit,
Instruction No. 8.29(A) (1989) 8
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
INTRODUCTION
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Fed. R. Crim. P. 29(a) requires the district court to
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grant a motion for acquittal if the evidence is insufficient to
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sustain a conviction. The Court must decide whether, viewing the
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evidence in the light most favorable to the government, any
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rational juror could have found the elements of the crime beyond a
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reasonable doubt. United States v. Loya, 807 F.2d 1483, 1486 (9th
8 Cir. 1987).
9 As set forth more fully below, Judgment of Acquittal is
10 mandated on Count Four of the Indictment, which charges Defendants
11 with corruptly authorizing a bribe on May 1, 1989, and on Count
12 Five, which charges Defendants with "falsification" of records of
13 payments to Robert O'Hara.
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15
16 I.
17 ARGUMENT
18 NO RATIONAL JUROR COULD FIND DEFENDANTS, AS CHARGED IN COUNT
FOUR, GUILTY OF CORRUPTLY AUTHORIZING A BRIBE ON MAY 1, 1989
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The Foreign Corrupt Practices Act criminalizes only
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payment or authorization of payment which is "corruptly" made; that
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is, only payment or authorization of payment which is made with the
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expectation of some explicit official action in return. 15 U.S.C.
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§ 78dd-l(a). The Act further requires that with respect to payment
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to a third party intermediary -- as the Indictment describes O'Hara
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the payment must be authorized to be made, "to any foreign
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
official .•• ," "for the purposes of - (A) (i) influencing any act
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or decision of such foreign official in his official
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capacity." 15 U.S.C. § 78dd-l(a)(3)(A) and 15 U.S.C. § 78dd-
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l(a) (3) (A) (i). In short, the payment must be for some prospective
5 act or decision of a foreign official.
6 The legislative history of the FCPA references the use of
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"corruptly" in the domestic br ibery statute. H.R. Rep. No. 640,
8 95th Congress, 1st Session, 8 (1977). The Ninth Circuit, in
9 agreement with other courts that have construed the domestic
10 bribery statute, has held that "corruptly" requires proof that a
11 quid pro quo exists between the alleged br ibe and the official
12 action sought. See United States v. Strand, 574 F.2d 993, 995-996
13 (9th Cir. 1978); see also United States v. Brewster, 506 F.2d 62,
14 71 (D.C.Cir. 1974); United States v. Johnson, 621 F.2d 1073 (10th
15 Cir. 1980).
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In Strand, the court made clear that in order to be
17 "corrupt," the payment at issue must be in exchange or return for
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some official action, or violation of official duty. 574 F.2d at
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995. Though the defendant in Strand argued that the trial court
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had defined "corruptly" as no more than the hope or expectation of
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generalized benefit to oneself, the Ninth Circuit emphasized that
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the trial court's instructions as a whole had in fact made clear to
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the jury that the receipt of the unlawful payment was required to
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be made in exchange or return for specific official action, or
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violation of official duty. Id. at 996, and n. 3.
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Thus, in order to meet its burden of proof for the crime
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charged in Count Four of the Indictment, the Government is required
to prove, in pertinent part, that:
(1) On May 1, 1989, the Defendants cor ruptly
paid or authorized payment to Robert O'Hara,
with the expectation of obtaining in return some
explicit official action in their favor;
(2) That the Defendants corruptly paid or
authorized payment to O'Hara knowing that O'Hara
would offer or give a portion of the payment to
Telecom officials; and
(3) That the Defendants knew that such offer or
payment by O'Hara would be for the purpose of
influencing the acts or decisions of Telecom
officials in their official capacities.
This burden has not been met.
No rational juror could conclude beyond a reasonable doubt
that any portion of Defendants' May 1, 1989 payment to Robert
O'Hara was authorized to be made to any Telecom officials for the
purpose of influencing any act or decision of such Telecom
officials in their official capacities.
The Government concedes that at the time of the May 1,
1989 payment, the Defendants had abandoned any pursuit of Telecom
contracts in Colombia.
1
O'Hara's undisputed testimony is that
1:.1
Scott MacKay explained in his opening statement:
However, by April of 1989, it was determined at
DTS that Mr. O'Hara's sole purpose at that point
should be to find a commercial distributor. The
whole deal changed. . • • But that didn't end
DTS's dealings with Mr. O'Hara because they
still had to pay him for services that he had
rendered in March.
Transcript of Government's Opening Statement, March 6, 1991 at 33-
34, attached hereto as Exhibit A.
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
Defendants determined during their March trip to Colombia that they
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were not interested in bidding on the Telecom contracts that O'Hara
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had appr ised them of, and that they didn't bid on any Telecom
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contracts.
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The Government presented no evidence that Defendants' May
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1, 1989 payment of $13,345 was intended to go to Telecom
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officials. The only evidence by the Government that even supports
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speculation that some portion of the May payment would go to
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Telecom officials is Robert 0' Hara 's testimony as to his
10 understanding that there was a "meeting of the minds" wi th Jack
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Iacobucci on January 13, 1989.
2
O'Hara's understanding, however,
12 is directly contrary to his sworn testimony at trial and in the
13 Grand Jury that Mr. Iacobucci did not enter into any agreement with
14 Mr. O'Hara.
3
15 Further, the Government has failed to present any evidence
16 at all that the May 1, 1989 payment was "corrupt." All evidence
17 relating to the May 1 payment shows that the payment could not have
18 been for the purpose of influencing any act or decision of Telecom
19 officials: In March Harris employees determined that they would
20 not bid for any Telecom contracts; they did not bid for any
21 contracts, and they ceased any pursuit of Telecom business as of
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~ I Testimony of Robert O'Hara, March 12, 1991 at 41-43,
attached hereto as Exhibit B.
II See Testimony of Robert O'Hara, March 12, 1991 at 43;
Testimony of Robert O'Hara, March 13, 1991 at 5:826; Grand Jury
Testimony of Robert O'Hara on September 15, 1989, at 21; all
attached hereto as Exhibit C.
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
the March trip.
2
The Government's theory on Count Four is that Defendants'
3
May 1 payment was reimbursement for money paid, or authorized to be
4 paid, by O'Hara in March.
4
Put differently, the Government
5 contends that on May 1, 1989 Defendants were reimbursing O'Hara for
6 money supposedly paid or authorized to be paid in March to
7 unidentified Telecom officials to obtain bid specification changes
8 on a contract that Harris employees had already determined in March
9 the company wouldn't bid for, and in fact did not bid for.
10 The Government's reimbursement theory is contrary to the
11 statutory requirement that the payment at issue must be made for a
12 prospective act or decision by the foreign government official.
13 The Ninth Circuit's decision in Strand leaves no doubt that
14 "corruptly" means that the payment must be made with the
15 expectation of official action or violation of official duty in
16 return. United States v. Strand, 574 F.2d 993, 995-996 (9th Cir.
17 1978). Criminal statutes must be construed narrowly; any arguable
18 ambiguity in a federal criminal statute cannot be interpreted to
19
embrace offenses not clearly wi thin the law. Crandon v. united
20
States, U.S. , 110 S.Ct. 997 (1990); United States v.
21 Dunlap, 573 F.2d 1092, 1093-94 (9th Cir. 1978).
22
Accordingly, judgment of acqui ttal is mandated on Count
23
Four.
24
25
il Transcript of Government's Opening Statement, March 6,
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1991 at 33-34, attached hereto as Exhibit A.
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
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II.
NO RATIONAL JUROR COULD FIND DEFENDANTS
GUILTY OF "FALSIFICATION" OF RECORDS
WHERE THE RECORDS THEMSELVES WERE IN FACT TRUE
Count Five of the Indictment charges Defendants with
violating the accounting provision of the Foreign C o r ~ u p t Practices
Act, which cr iminali zes a knowing falsi fica tion of those books,
records, and accounts which the FCPA requires a corporation to
keep, in reasonable detail, accurately and fairly reflecting the
transactions and dispositions of the assets of the corporation.
The Indictment charges that the Defendants falsified their books,
records and accounts by describing payments to O'Hara as
12 "consultant retainer fees," "consultant expenses," and "incidental
13 fees," when in truth a portion of the payments were for foreign
14 government officials.
15 Upon request by the Defendants for clarification of the
16 facts constituting Defendants' violation of the accounting
17 provision, the Government has given two explanations. First, the
18 Government contended that Defendants' records were false because
19 they did not describe that a portion of the $22,845 paid to O'Hara
20 was "to bribe foreign officials." Government's Opposition to
21 Defendants' Motion to Dismiss Count Five, at p. 7:18-21. Next, the
22 Government contended that the Defendants' falsified check request
23 forms and wire transfers and expense journal entries by failing to
24 state that a portion of the money paid to O'Hara was dispersed by
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Harris Corporation "to pay foreign officials." Letter from Scott
26 MacKay to Jeffrey Chanin dated January 31, 1991, attached hereto as
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
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Defendants' Exhibit D.
However, Robert O'Hara's uncontradicted
testimony
establishes that Defendants' descr iption of payments to him as
"consultant retainer fees," "consultant expenses," and "incidental
fees," was in fact true -- no disbursements or payments were ever
made to a foreign official.
MacKay: You indicated it was not your
intent to pay those incidental fees or slush
funds to anyone?
O'Hara: That's correct
MacKay: Now, Mr. 0' Hara, what is it that you
intended to do with these incidental fees?
O'Hara: Put them in my pocket.
12
Testimony of Robert O'Hara, March 12, 1991 at 4:585-587, attached
13 hereto as Exhibit E.
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Feldman: You never paid any bribes in Colombia,
did you?
O'Hara: Never.
Testimony of Robert O'Hara, March 13, 1991 at 5:786-787, attached
hereto as Exhibit F. Robert O'Hara never intended to do -- or did
-- anything with the money paid to him as "consultant retainer
fees," "consultant expenses," and "incidental fees" except, in
fact, to pocket it.
A first principle of our criminal jurisprudence is that
every crime requires proof of both a mens rea, guilty mind, and an
actus reus, prohibited act. Here, there has been no act prohibited
by law.
The Defendants did not "falsify" their records -- their
descriptions of payments to O'Hara accurately and truly described
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
the disposition of the monies paid to him.
2
A first requirement of every federal "false statement" or
3
"falsification" statute is that the statement, record or other
4 representation must in fact be false.
5
Indeed, Defendants have not
5
found a single reported case in which a defendant was charged under
6
any federal false statement or falsification statute with making a
7
"false" statement or record when that statement or record was not
8
in fact false. For example, falsity is a specific, separate
9 element of 18 U.S.C. § 1001, the principal "false statements"
10 statute, which, like the FCPA, uses the .language "whoever
11 falsifies."6 Falsi ty of a representation or omission is also an
12 explicit requirement of the perjury statute,7 the false oaths and
13 statements provision of the bankruptcy statute,8 the bank fraud
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15 ~ I Falsity, as the Government's proposed jury instruction
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agrees, must mean:
a book, record, or account is "falsified" if it
is untrue when made and was then known to be
untrue by the person making it, or causing it to
be made.
Devitt & Blackmar, Federal Jury Practice & Instructions,
Instruction § 16.02 (3rd ed. 1977 and Supp. 1990).
£1 See, ~ United States v. Whitaker, 848 F.2d 914, 916-917
(8th Cir. 1988); United States v. Irwin, 654 F.2d 671, 675-676
(10th Cir. 1981); United States v. Lange, 528 F.2d 1280 (5th Cir.
1976); United States v. Adler, 380 F.2d 917 (2nd Cir. 1967).
II See Manual of Model Jury Instructions for the Ninth
Circuit, Instruction No. 8.29(A) (1989) (18 U.S.C. § 1621 requires
proof that testimony was in fact false); see also United States v.
Forrestt, 623 F.2d 1107, 1116 (5th Cir. 1980)-.---
~ I See Metheany v. United States, 390 F.2d 559 (9th Cir.
1968); UnIted States v. Overmyer, 867 F.2d 937 (6th Cir. 1989).
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
statute,9 and the false statements provision of the tax code.
lO
2
construing the evidence in favor of the Government, at
3
most Defendants here attempted to falsify their books, records and
4
accounts by describing payments to 0' Hara as fees and expenses
5
while believing, incorrectly, that their descriptions were false.
6
Customarily, the government charges an attempt where the
7
defendant's intent satisfies the mental state described by the
8 criminal statute, but where his act does not accomplish the conduct
9
prohibited by statute. Federal law prohibiting possession or
10 distribution of a "controlled substance" provides a case in
11
point: where a defendant, possessing the level of knowledge or
12 intent required by the statute, distributes a substance which,
13 unknown to him, is not in fact "controlled" -- for example, where
14 he distributes powder detergent rather than cocaine he may be
15 charged only with attempted violation of 21 U.S.C. § 846. See
16 United States v. Quijada, 588 F.2d 1253 (9th Cir. 1978).
17
Defendants cannot be convicted for attempted
18 falsification, however, both because it is not charged in the
19 Indictment and because the accounting provision of the Foreign
20
Corrupt Practices Act does not criminalize attempted
21
falsification. Under federal law, attempt can be charged only
22 where a specific criminal statute outlaws both its actual as well
23
24
2/
See United States v. Cloud, 872 F.2d 846 (9th Cir. 1989).
25
10/ See United States v. Marabelles, 724 F.2d 1374 (9th Cir.
26
1984); UnIted States v. Howard, 855 F.2d 832, 835 (11th Cir. 1988).
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MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
as its attempted violation. United States v. Rivera-Sola, 713 F.2d
2
866, 869 (1st Ci r. 1983); see also Uni ted States v. Rovetuso, 768
3
F.2d 809 (7th Cir. 1985); United States v. Marley, 632 F.2d 978,
4
987 (2nd Cir. 1980). Thus, to draw again upon the example cited
5
above, attempted distribution or possession of a controlled
6
substance is criminalized by an explici t attempt provision at 21
7
U.S.C. § 846. The FCPA contains no such provision.
8
In view of a complete lack of any evidence that O'Hara
9 ever paid any money to a foreign official, no reasonable juror
10 could find that Defendants "falsified" their books, records, and
11 accounts by failing to state that the money paid to O'Hara was to
12 "bribe foreign officials" or to "pay foreign officials." Judgment
13 of Acquittal is therefore mandated on Count Five.
14
15
16
17
18
19
III.
NO RATIONAL JUROR COULD FIND DEFENDANTS GUILTY OF
CONSPIRING TO FALSIFY HARRIS' RECORDS OR "FALSIFICATION"
OF RECORDS WHERE THE GOVERNMENT'S EVIDENCE SHOWS THAT
DEFENDANTS MERELY FAILED TO DISCLOSE; A FAILURE TO
DISCLOSE IS NOT A CRIME UNDER 15 U.S.C. § 78m(b)(4) AND (5)
Count Five of the Indictment charges Defendants with
20 "falsifying" Harris' records on the theory that Defendants' failed
21 to disclose that a portion of O'Hara's retainer and expense money
22 was to pay foreign government officials. The Government has never
23 claimed that the retainer and expense money recorded in Harr is'
24
records was not, in fact, paid to O'Hara, or that the records were
25
false for any reason other than the non-disclosure of the ultimate
26
disposition of such money by O'Hara. There is no evidence that
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Defendants "falsified" their records by any affirmative
misrepresentation; rather, at most Defendants "falsified" by
omission, that is, by failing to describe the ultimate disposition
of money paid to O'Hara.
Defendants' failure to detail the
ultimate disposition of money to O'Hara, however, does not
constitute a crime under the FCPA accounting provision, 15 U.S.C. §
78m(b)(4) and (5).
A.
15 U.S.C. § 78m(b)(4) And (5) as Amended in 1988 Is
Unambiguous on its Face
The Foreign Corrupt Practices Act does not permit criminal
prosecution for failing "to make and keep books, records and
accounts which, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the issuer."
See 15 U.S.C. § 78m(b)(2).
In the 1988 amendments to the FCPA,
Congress expressly provided in Paragraph (4) of subsection 78m(b):
(4) No criminal liability shall be imposed for
failing to comply with the requirements of
paragraphs (2) of this subsection except as
provided in paragraphs (5) of this
subsection.
Paragraph (5), in turn, only criminalizes knowingly falsifying
books, records, or accounts.
The language of Paragraph (5) is
unequivocal, and does not include failing to make and keep detailed
books and records:
(5) No person shall •.. knowingly falsify any
book, record, or account described in
paragraph (2).11
The Government concedes that a knowing failure to make and
- 11 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
2
3
4
5
6
7
keep books, records and accounts in the detail required by
Paragraph (2) is not a crime under Paragraphs (4) and (5).12 Yet,
at the same time, the Government asks the Court to interpret the
separate charge of "knowingly falsifies" to include falsification
through a failure to keep sufficiently detailed records. This
strained interpretation swallows the restriction on criminal
liabili ty imposed by Paragraph ( 4 ) , effectively permitting
8 Defendants to be prosecuted for a violation of the civil "detailed
9
records" standards. Imposition of criminal liability for failing
10 to make and keep detailed records is exactly what the Government
11 urges in charging falsification by omission, flouting the plain
12 intent and meaning of Paragraphs (4) and (5) of 15 U.S.C. § 78m(b).
13 As set forth more fully below, the Government's requested
14 interpretation of 15 U.S.C. § 78m(b)(4) and (5) also ignores
15 established practice and usage in drafting criminal statutes;
16 Congress provides for independent language prohibiting "omission"
17
18
19
20
21
22
23
24
25
26
11/ Paragraph (5) also criminalizes knowingly circumventing or
failing to implement a system of accounting controls. See 15
U.S.C. § 78m(b)(5). The Indictment nowhere alleges that Defendants
violated this provision, and counsel for the Government has
conceded that that provision is not at issue in this case.
12/ The language of Count Five of the Indictment directly
charges Defendants with the crime of failing to keep reasonably
detailed records. Similarly, the language of Paragraphs B.2 and
C.9 of Count One charges the Defendants with conspiring to commit
such a crime. However, in its Opposition to Defendants' Motion to
Dismiss Count Five, the Government conceded that the failure to
keep reasonably detailed records does not give rise to criminal
liability under the Act, and argued instead that the "reasonable
detail" language of Paragraph (2) at 15 U.S.C. § 78m(b) was
"relevant to" the charge of falsification.
- 12 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
or a "failure to keep records" when it chooses to criminalize such
2
conduct in addition to the conduct of affirmative
3
"falsification." In agreement with Congress' practice, the federal
4 courts have consistently construed language of falsification
5 identical to that used in Paragraph (S) of IS U.S.C. § 78m(b) to
6 cover only affirmative misrepresentations.
7
8
9
B. 15 U.S.C. S 78m(b)(4) And (5) is Unambiguous with
Reference to Established Usage by Congress and Consistent
Judicial Interpretation
10 A criminal statute prohibiting false representations, such
11 as IS U.S.C. § 78m(b)(S), may not be used to prosecute a failure to
12 disclose additional information. Congress has consistently
13 described falsification as an offense distinct from omission or
14
15
16
17
18
19
20
21
22
23
24
25
26
concealment in penal statutes.
13
When it chooses to prohibit
13/ See, ~ 7 U.S.C. § 1373 ("failing to make any report or
record" in addition to "making any false report or record"); 7
U.S.C. § 1642 ("failing to make any report or keep any record" in
addition to "making any false report or record"); IS U.S.C. § 80a-
33 ("omit to state any facts necessary" in addition to "make any
untrue statement"); 16 U.S.C. § 916e ("fails to make, keep, or
furnish" report in addition to "furnish a false" report); 18 U.S.C.
§ lS2 ("knowingly and fraudulently conceals" in addition to
"knowingly and fraudulently makes a false oath or account"); 18
U.S.C. § 1001 ("concealment" in addition to "false
representation"); 18 U.S.C. § ISIS ("knowingly making a false
statement" in addition to "intentionally omitting information from
a statement"); 26 U.S.C. § S762(a)(2) ("furnishing false
information" in addition to "failing to furnish information"); 26
U.S.C. § S763(b) ("fails to make any record, return, report, or
inventory," in addition to "keeps or makes any false or fraudulent
record, return, report, or inventory"); 4S U.S.C. § 438(e) ("does
not enter required specific facts" in addition to "makes a false
entry"); 47 U.S.C. § 220(e) ("willfully neglect or fail to make
full, true, and correct entries in such accounts" in addition to
"willfully make any false entry in the accounts"); 49 U.S.C. §
(cont. )
- 13 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
omissions, Congress incorporates express language of "omission" and
2
"concealment," in contrast to the "falsification" language used in
3
15 U.S.C. § 78m(b)(5).
4
In addition to established congressional practice, the
5
federal courts have consistently interpreted statutes prohibi ting
6
falsification to include only affirmative misrepresentation, absent
additional language clearly prohibiting omission, concealment, or
8 failure to make records. Beginning with Bronston v. United States,
7
9 409 U. S. 352, 357-358 (1973), the courts have held that a person
10 who states the literal truth cannot be prosecuted under a statute
11 prohibiting the making of false representations or records. Thus,
12 literally true statements may not be prosecuted under the federal
13 perjury statute,14 the statute prohibiting making false statements
14 to a grand jury,15 the "false statements" statute,16 the statute
15 prohibiting any false entry or statement of a bank's accounts,17 or
16 under the bank fraud statute.
18
17
18
19
20
21
22
23
24
25
26
10529(f) ("false or incomplete entry"); 49 U.S.C. § 11909(a) ("does
not enter business related facts and transactions in the record" in
addition to "makes a false entry in the report or record").
14/ See, ~ , Bronston v. United States, 409 U.S. 352, 357-
358 (1973-).-
15/
See, ~ , United States v. Cowley, 720 F.2d 1037 (9th
Cir. 1983r;-see also United States v. Cook, 497 F.2d 753 (9th Cir.
1973).
16/
See, ~ , United States
(6th Cir. 1989); United States v.
1963).
v. Gahagan, 881 F.2d 1380, 1382
Diogo, 320 F.2d 898 (2nd Cir.
17/
See, ~ , United States v. Erickson, 601 F.2d 296, 302-03
(7th Cir. 1979).
(cont.)
- 14 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
Defendants' descriptions of the subject transactions in
2 this case were literally true and accurate. The Indictment alleges
3 that $22,845 was, in fact, paid to O'Hara for consultant and
4 retainer fees and for expenses; this is exactly what the Indictment
5 alleges, and the Government's evidence shows, was described by the
6 Defendants in Harris' books and records. O'Hara has testified that
7 he spent the $22,845 for expenses such as travel and hotel
8 accommodations, public relations, entertainment, and kept the
9 remainder of the money as his "retainer" or "consulting" fees .19
10 Defendants stated the literal truth when they recorded the subject
11 transactions as "consultant retainer fees," "consultant expenses,"
12 and "incidental fees."
13
Following the ruling of Bronston and its progeny,
14 Defendants cannot be convicted for conspiring to fail to make and
15 keep records and accounts in the detail required by § 78m{b){2),
16 since this objective is not a crime under subparts (4) and (5), or
17 can they be convicted for falsifying Harris' records based on the
18
literally true statements alleged in the Indictment, and
19 established by O'Hara's own testimony. The statute at issue here,
20
15 U.S.C. § 78m{b){5), only permits criminal prosecution for
21
"knowingly falsifying any book, record, or account." Paragraph (5)
22
contains no language prohibiting omission or concealment. Congress
23
24
18/ See, ~ , United States v. Attick, 649 F.2d 61, 63 (1st
Cir. 1981).
25
19/ See Testimony of Robert O'Hara, March 14, 1991 at 6:930-
26
938; 6:990-991, attached hereto as Exhibit G.
- 15 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
2
3
4
5
made clear its intent not to criminalize omissions under the FCPA
by expressly limi ting criminal liabili ty to Paragraph (4) of 15
U.S.C. § 78m(b). In the absence of express language criminalizing
omission or concealment, the statute must be construed only to
prohibit affirmative falsification. See United States v. Diogo,
6
320 F.2d 898,902 (2nd Cir. 1963); In re Stringer, 847 F.2d 549,
7 551 (9th Cir. 1988).
8
9
10
c. Any Arguable Ambiguity in the Meaning of 15 U.S.C. §
78m(b)(4) and (5) Must be Construed in Favor of The
Defendants
11 15 U.S.C. § 78m(b)(4) and (5) could not be clearer in that
12 "falsification," not failure to keep records in reasonable detail,
13 triggers criminal liability under the Foreign Corrupt Practices
14 Act. However, assuming the statute were somehow ambiguous as to
15 whether "falsification" encompasses a failure to disclose, as well
16 as affirmative misrepresentation, a first principle of statutory
17 construction in criminal cases requires that the statutory language
18 be construed narrowly, and any ambiguity must be resolved in favor
19
of the defendants. Crandon v. United States, u.s. , 110
20 S.Ct. 997 (1990); United States v. Dunlap, 573 F.2d 1092, 1093-1094
21 (9th Cir. 1978) (criminal statutes must be str ictly construed; any
22 ambiguity in a criminal law cannot be interpreted to embrace
23
24
25
26
offenses not clearly within the law).
The Supreme Court has warned that it is especially
important that complex federal crimes -- such as the FCPA -- be
defined narrowly to minimize the scope of the conduct embraced.
- 16 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
2
3
4
5
6
United States v. Bass, 404 U.S. 336, 348 (1971) (cited in
Crandon).
It is rare, the Court has warned, that legislative
history or statutory construction will support an interpretation of
a fedeTal criminal statute broader than that clearly warranted by
the text. Crandon, 110 S.Ct. at 1003.
This is particularly true here, where the language of §
7 78m(b)(4) evidences clear intent by Congress to restrict the scope
8 of criminal liability, while the Government's reading of the
9 accounting provision would expand criminal liability. To interpret
10 "knowingly falsifies" expansively would be to defeat Congress'
11 intent as expressed by the language of the statute, not to give it
12 effect.
13 For these reasons, a judgment of acquittal on Count Five
14 of the Indictment must be entered.
15
16
17
18
19
20
21
22
23
24
25
26
- 17 -
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
CONCLUSION
For all the foregoing reasons, this Court should grant
Defendants' Motion for Judgment of Acquittal on Count Four, and on
Count Five.
Dated: March 18, 1991
ILK/JI-3P6
Respectfully submitted,
KEKER & BROCKETT
By: g ~ ~ - ~ - ~
--+=J-=E-=F=F=R=E::":Y,--:R,- • ..L...::C==HA=-=-N=-=I"..:N=-----
- 18 -
JULIA BOAZ-COOPER
On behalf of all
Defendants
MOTION FOR JUDGMENT OF ACQUITTAL AND INCORPORATED MEMORANDUM
PROOF OF SERVICE BY HAND
2
I am over the age of eighteen years and not a party to
3
this action. My business address is:
4
710 Sansome Street
San Francisco, California 94111-1704
5
On the date specified below, I caused to have hand served
6
7
8
the attached:
MOTION FOR JUDGMENT
INCORPORATED MEMORANDUM
OF
ACQUITTAL AND
9 by placing a true copy thereof (to which was attached a copy of
10 this document) in a sealed envelope and having said document hand
11 delivered to the following:
12 Scott MacKay, Esq.
Peter Loewenberg, Esq.
13 U.S. Attorneys Office
450 Golden Gate, Room 16201
14 San Francisco, CA 94102
15 Executed on March 18, 1991, at San Francisco, California.
16
I, Ingr id Komi to, declare under penalty of per jury that
17 the foregoing is true and correct.
18 C\ g,"(;t:OL:;.l;;
4' ngr id Komi to
19
20
21
22
23
24
25
26
PROOF OF SERVICE BY HAND
EITHER ALREADY COMPLETED OR CLOSED. AND D. T. S. WASN'T
ELIGIBLE, OR FOR OTHER REASONS D. T. S. REALLY WASN'T SUITABLE
TO BID ON THOSE SPECIFICATIONS.
ULTIMATELY, THEY CONCLUDED THAT WHILE THERE MIGHT BE SOME
OTHER GOVERNMENT WORK AVAILABLE IN COLUMBIA AS ~ L L AS
COMMERCIAL WORK, THESE LARGE CONTRACTS THAT O'HARA HAD BEEN
SELLING JUST W£REN'T THERE.
NOW, MR. O'HARA WILL TESTIFY THAT HE WASN'T TOO CONCERNED
WHEN THIS HAPPENED BECAUSE THEY HAD MET WITH CONGRESSMAN LOPEZ,
AND HE APPEARED TO BE A MAN OF GREAT INFLUENCE. AND O'HARA WAS
OBVIOUSLY CONNECTED WITH HIM. SO HE STILL THOUGHT HE COULD DO
BUSINESS WITH D. T. S. OR HARRIS CORPORATION AND HE TOLD HIM,
"THERE'S OTHER GOVERNMENT BUSINESS OUT THERE. ~ STILL HAVE
SMALLER GOVERNMENT BUSINESS. AND YOU FOLKS HAVE SEEN BOGOTA.
YOU KNOW, THERE IS LOT OF COMMERCIAL THINGS AVAILABLE AS ~ L L .
SO HE WASN'T TOO CONCERNED. HE THOUGHT THAT THEY HAD BOTH
GOVERNMENT BUSINESS AND COMMERCIAL BUSINESS STILL AVAILABLE TO
THEM.
weLL, THE EVIDENCE WILL SHOW THAT MR. STENVENSON
SUGGESTED THAT MR. O'HARA BE DROPPED BECAUSE HE DIDN'T THINK HE
WAS GOING TO DELIVER. BUT THAT DECISION WAS NOT MADE AND FOR
ANOTHER TWO W£EKS MR. STENVENSON WAS WORKING ON THIS
REPRESENTATIVE AGREEMENT FOR MR. O'HARA.
HOWEVER, BY APRIL 11 OF 1989. IT WAS DETERMINED AT D. T.
S. THAT MR. O'HARA'S SOLE PURPOSE AT THAT POINT SHOULD BE TO
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
FIND THEM A COMMERCIAL DISTRIBUTOR. THE WHOLE DEAL CHANGED.
YOU HAVE TO UNDERSTAND, WHEN I SAY THAT. NO AGREEMENT HAD BEEN
SIGNED YET; EVERYTHING HAD BEEN DONE ORALLY, BUT AT THAT POINT
THEY SHIFTED FROM TRYING TO DRAFT UP A REPRESENTATIVE AGREEMENT,
AS MR. O'HARA HAD ORIGINALLY PROPOSED. TO ONE THAT WAS
SUBSTANTIALLY DIFFERENT. BUT THAT DIDN'T END D. T, S.·S
DEALINGS WITH MR. O'HARA, BECAUSE THEY STILL HAD TO PAY HIM FOR
THE SERVICES THAT HE HAD RENDERED IN MARCH.
BETWEEN APRIL 11 AND APRIL 26. MR. O'HARA SENT A NUMBER
OF FACSIMILES WITH DIFFERENT INVOICES FROM NaN YORK TO D. T. S.
OUT IN CALIFORNIA, OUT HERE IN NOVATO.
AND THE LAST OF THESE INVOICES, AND HE KEPT CHANGING THEM
AT THE VARIOUS LEVELS AT D. T. S., BUT THE LAST OF THESE
INVOICES WAS ON APRIL 26. 1989 WHEN HE SUBMITTED A BILL FOR
$13,345, INCLUDING $3,000 IN INCIDENTAL FEES, THIS BILL HAD NO
DOCUMENTATION, NO EXPLANATION WHAT THESE INCIDENTAL FEES WERE.
AND AGAIN, THE EVIDENCE WILL SHOW THAT ALTHOUGH MR.
O'HARA HAD MADE IT PERFECTLY CLEAR PRIOR TO THAT IN HIS
DISCUSSION TO MR. IACOBUCCI AND MR. SCHULTZ. THAT THESE
INCIDENTAL FEES WOULD BE USED TO PAY FOREIGN OFFICIALS, THEY
NONTHELESS AUTHORIZED ON MAY 1ST $13.345 TO BE WIRED FROM D. T.
S. TO MR. O'HARA IN NaN YORK.
LET ME JUST BRIEFLY PUT UP FOR YOU THIS CHECK REQUEST.
AGAIN, "POLO ASSOCIATES.
WIRE FUNDS TO MANUFACTURER'S HANOVER TRUST. DATED
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
0' HARA - 0 I RECT /MAC f 41
HARRIS CORPORATION COULD THEN APPOINT AS A LOCAL REPRESENTATIVE
2 OF HARRIS CORPORATION IN COLUMBIA.
3 o. AND WHAT, IF ANYTHING, DID YOU TELL MR. IACOBUCCI ABOUT THE
4 OWNERSHIP OF THAT LOCAL COMPANY?
5 A. I TOLD HIM THAT ALFONSO LOPEZ WOULD BE PART OWNER OF THE
6 COMPANY.
7 o. AND DID YOU DISCUSS WITH MR. IACOBUCCI THE PERCENTAGES THAT
8 POLO AND THE LOCAL COMPANY WOULD RECEIVE?
9 A. I DISCUSSED TO HIM THAT THE LOCAL COMPANY SHOULD
10 RECEIVE FIVE PERCENT OF WHATEVER COMMISSIONS MIGHT BE WORKED OUT
11 AND THAT POLO WOULD RECEIVE 10 PERCENT. AND THE REASON POLO
12 WOULD GET 10 PERCENT IS BECAUSE ALFONZO WOULD GET FIVE PERCENT.
13 SO HE WOULD BE GETTING IT FROM BOTH ENDS.
14 o. SO YOU TOLD MR. IACOBUCCI THAT YOU ALSO WOULD PAY MR. LOPEZ
15 FROM YOUR 10 PERCENT TO POLO?
16
17
A.
O.
RIGHT. RIGHT.
YOU INDICATE A MOMENT AGO YOU DISCUSSEJ YOU
18 CHARACTERIZED AS INCIDENTAL FEES OR SLUSH FUNDS?
19
20
A.
O.
CORRECT.
WOULD YOU EXPLAIN TO THE JURY. PLEASE. WHAT IT IS THAT YOU
21 TOLD MR. IACOBUCCI WITH RESPECT TO THOSE?
22 A. BELIEVED THAT THE FOUR THOUSAND DOLLARS OR SO A
23 MONTH THAT I WAS GOING TO OPERATE ON WASN'T THAT MUCH IF I
24 WASN'T GOING TO GET EXPENSES TO GO BACK AND FORTH. SO I CREATED
25 THIS IDEA OF A SLUSH FUND OR INCIDENTAL FEE SO THAT I CAN, IN
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
O'HARA - DIRECT/MAC ~ .. 42
1 EFFECT, GET MORE MONEY FOR MYSELF.
2 AS EXPLAINED TO IT TO JACK. IT CAME OUT THAT IT WAS TO
3 TAKE CARE OF SOME LOCAL OFFICIALS IN COLUMBIA. LOCAL TELECOM
4 OFFICIALS, BUT I REALLY, AT THAT MOMENT IN TIME. HADN'T INTENDED
5 TO PASS ANY MONEY TO ANYBODY.
6 a. AND WHAT DID YOU TELL MR. IACOBUCCI THAT THIS MONEY WOULD
7 BE PAID FOR?
8 A. TO TAKE CARE OF -- TO TAKE CARE. EXCUSE ME. OF LOCAL
9 GOVERNMENT OFFICIALS. INCLUDING ANYBODY IN TELECOM THAT MIGHT
10 HAVE TO BE TAKEN CARE OF, AND ALSO ALFONSO LOPEZ WOULD SHARE IN
11 THOSE FEES.
12 MR. FELDMAN: I'M SORRY. I MISSED THE LAST TWO
13 WORDS.
14 THE WITNESS: MR. LOPEZ WOULD ALSO SHARE IN THOSE
15 FEES.
16 BY MR. MAC KAY:
1 7
18
19
a.
A.
a.
AND WHAT FEES WOULD THOSE?
THE INCIDENTAL FEES OR SLUSH FUNDS. WHATEVER I SET UP.
YOU INDICATED AT THE TIME IT WAS NOT YOUR INTENT TO PAY
20 THOSE INCIDENTAL FEES OR SLUSH FUNDS TO ANYONE?
21
22
23
24
A.
a.
THAT'S CORRECT.
DID YOU THINK THAT IT MIGHT BECOME NECESSARY
MR. FELDMAN: OBJECT. IRRELEVANT.
THE COURT: SUSTAINED.
25 BY MR. MAC KAY:
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
O'HARA - DIRECT/MAC KAY 43
-----------------------,
Q. DID YOU IN FACT REACH AN AGREEMENT WITH MR. IACOBUCCI AT
2 THIS MEETING?
3 MR. FELDMAN: OBJECT. HE MAY SAY WHAT MR.
4 IACOBUCCI SAID.
5 THE COURT: OR HE MAY TESTIFY TO WHETHER HE
6 THINKS HE HAD AN AGREEMENT.
7 BY MR. MAC KAY:
Q. LET ME STRIKE THAT. 8
9
10
HOW LONG DID THIS MEETING TAKE. MR. O'HARA?
A. DON'T THINK IT TOOK MORE THAN A HALF HOUR OR 35 MINUTES,
11 AT THE TOPS.
12 Q. AND AT THE END OF THE MEETING, WHAT. IF ANYTHING, DID MR.
13 IACOBUCCI SAY TO YOU?
14 A. ~ L L , HE INDICATED THAT HE WOULD LIKE TO DO BUSINESS BUT
15 HE'S A A TWO-BILLION DOLLAR CORPORATION AND HE COULDN'T DO IT ON
16 A HANDSHAKE. THAT I SHOULD -- I SHOULD WRITE DOWN THE TERMS
17 THAT ~ DISCUSSED AND FORWARD IT TO HIM FOR HIS ATTORNEYS TO
18 LOOK OVER.
19 Q. NOW, MR. O'HARA, WHAT IS IT THAT YOU INTENDED TO DO WITH
20 THESE INCIDENTAL FEES?
21 A. PUT THEM IN MY POCKET. IF IT WAS NECESSARY IN COLUMBIA,
22 WHICH I DIDN'T BELIEVE IT WOULD BE, I WOULD HAVE TAKEN CARE OF
23 WHATEVER--
24 MR. FELDMAN: EXCUSE ME. MOVE TO TO STRIKE THE
25 "WHATEVER" FROM THE WITNESS' ANSWER.
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
O. DID YOU IN FACT REACH AN AGREEMENT WITH MR. IACOBUCCI AT
2 THIS MEETING?
3
MR. FELDMAN:
OBJECT. HE MAY SAY WHAT MR.
4 IACOBUCCI SAID.
5
THE COURT:
OR HE MAY TESTIFY TO WHETHER HE
6 THINKS HE HAD AN AGREEMENT.
7 BY MR. MAC KAY:
O. LET ME STRIKE THAT.
8
9
10
HOW LONG DID THIS MEETING TAKE. MR. O'HARA?
A.
DON'T THINK IT TOOK MORE THAN A HALF HOUR OR 35 MINUTES,
11 AT THE TOPS.
12 O.
AND AT THE END OF THE MEETING. WHAT. IF ANYTHING. DID MR.
13 IACOBUCCI SAY TO YOU?
14 A.
~ L L . HE INDICATED THAT HE WOULD LIKE TO DO BUSINESS BUT
15 HE'S A A TWO-BILLION DOLLAR CORPORATION AND HE COULDN'T DO IT ON
16 A HANDSHAKE. THAT I SHOULD -- I SHOULD WRITE DOWN THE TERMS
17 THAT ~ DISCUSSED AND FORWARD IT TO HIM FOR HIS ATTORNEYS TO
18 LOOK OVER.
19 O.
NOW. MR. O'HARA. WHAT IS IT THAT YOU INTENDED TO DO WITH
20 THESE INCIDENTAL FEES?
21 A.
PUT THEM IN ~ POCKET. IF IT WAS NECESSARY IN COLUMBIA,
22 WHICH I DIDN'T BELIEVE IT WOULD BE. I WOULD HAVE TAKEN CARE OF
23 WHATEVER--
24
MR. FELDMAN:
EXCUSE ME. MOVE TO TO STRIKE THE
25 "WHATEVER" FROM THE WITNESS' ANSWER.
ROSITA FLORES. OFFICIAL COURT REPORTER. USDC
O'HARA -
5-826
1 WELL, I FELT THAT WE HAD AN AGREEMENT, BASED ON THE
2 MEETING.
3 Q. ALL RIGHT.
4 A. THE POINTS THAT I HAD POINTED OUT, AND THAT WERE IN THE FAX
5 THAT YOU SHOWED ME EARLIER, WERE THE POINTS THAT I BELIEVE WE
6 HAD AGREED ON.
7 Q. OKAY. PERHAPS YOU CAN ANSWER MY QUESTION.
8 AFTER THE MEETING ON JANUARY 13TH' THERE WERE LOTS OF
9 POINTS LEFT TO NEGOTIATE; RIGHT?
10 A. (PAUSE.)
11 I DON'T KNOW WHAT YOU MEAN BY -LOTS OF POINTS-.
12 I'M I'M ••••
13 Q. WELL, YOU REGARDED THE CONVERSATION YOU HAD WITH JACK AS A
14 VERY LOOSE CONVERSATION, DIDN'T YOU?
15
16
17
18
A.
Q.
A.
AS A VERY WHAT?
AS A VERY LOOSE CONVERSATION.
NO, I DIDN'T REGARD IT AS VERY LOOSE AT ALL.
I THOUGHT THAT WE HAD A MEETING OF THE MINOS.
•
WE
19 SHOOK HANDS. HE SAID HE WOULD LIKE TO DO BUSINESS IN COLOMBIA.
20 THAT HE WOULD HAVE TO CHECK WITH HIS ATTORNEYS.
21 Q. AND IT WAS A VERY LOOSE MEETING, BECAUSE IT WAS JUST YOUR
22 FIRST MEETING; RIGHT?
23 A. IF YOU CHARACTERIZE IT AS SUCH. I -- I THOUGHT WE HAD A
24 MEETING OF THE MINDS.
25 Q. YOU TESTIFIED BEFORE THE GRANO JURY7 RIGHT?
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
ROBERT 0' HAllA
21
1 A. No.
2 Q. Since 19891
3 A. I know since 1985.
4 Q. 19851
5 A. 'les.
6 Q. Now. let's get back to the meeting with Mr.
7 Iacobucci in New 'lark which took place in your offices, at
8 the end of your conversation about what you could do for
9 Iacobucci and for Harris, did Mr. Iacobucci say anything
10 to indicate that he was in favor of your proposal?
11 A.
Well. we came to the conclusion that we
12 like to have a contract; being a two billion
13 dollar corporation. he couldn't do it on a handshake, so
14 he had to go through formal steps to affect a contract
15 between Polo and Harris.
16 o.
Did he say at that meeting he would like to
17 dc with you?
IS A. Uh-huh.
19 o.
And did you say the same to him?
20 A. Yes.
21 o.
Did you discuss any terms of the contract
22 that would be entered into in the future would contain?
23 Did you discuss your monthly salary?
24 A.
It wasn't a salary. It was an independent
5 contract. Be set up the contract for certain fees for
S C H f LLER & cmnD1HOmWG1II'CmIS
..... . _ ...... -- . ----:--._------
- - -- -- ......
_ ...... __ •. _ .......... ......'' "v....J.--. ......
I.
u.s. Dtpanmeat of JUIdcc
JAN- 3 J 1991
FE!) 01 1991
BX FACS!H'ILE WII.SON.
Ja::rey R. ChAnin, Eaq.
Kakar " Srackett
710 San.em. Street
San Francisco, Ca11:orn1a i411l
Dear Mr. Chanin:
OQOOHICH Ii ROS"TI
ReI unit.4 stBtCQ y. Harti' It 010
No. Cr. 90 0456 CAL
Thank you for your latter datad January 2g, 1991 in which you
inquira a. tc cur position concarninq tho natura or the
talaitication allaqad 1n Count riv •.
15 7Sm(b) and 'Sff make Qriminal the know!n;- And
w111tul tGl.1t1oition of i •• u.r
'
• Qook., reQorQa, and ••
In the in.tant oaS8, detendants talsitiad check request forma and
wire transfer and expan.a by ta11inq to reflect in
thoaa Dook., racords, and aooount. th8;1: a portion of the money paid
to Rob.rt D. O'Hara, doinq bu.in ••• -as Polo A •• cciAt •• , Ino., wa.
disbursed by Harri. corporation to tor.i;n officials.
CCt Robart P. Feldman, Esq.
Michaal L. Fayad, Eaq.
•• R. Breyer, Seq.
S1ncarely,
LauronCQ A. urqanacn
Chief, Fraud Seotion
criminal 01vi&ion
By:

SQot.t. w:·
Trial Attorney
BX FACSIMILE
Jetfrey R. Chanin, Elq.
Keker , Brockett
710 Sansome Streat
u.s. Department or Jusdec
JAN 3 I 1991
San Francisco, California 94111
Oear Mr. Chanin,
ReI United statal V, Harti. It
No. Cr. gO 0456 CAL
:" E eEl V E D
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WILSON. SQNSINI,
/:lOOCHleli & ROSA TI
This letter i& to rQquest that a4v1ae U$ if you intend to
1neroduca At trial ev1aenca at the polyqraph 8xaminat1on taken
Mr. Iacobucci, to includ •• licitinq tram any witn ••• the taot that
Mr. Iacobucci submittad to a polyqraph axamination. A4ditionally,
it is that you advisQ us it you intend to qUGstion Mr.
Wang or Mr. O'Hara, or w1tnea., Mr. Wanq or
Mr. O'Hara haa baan a'ked to 8ubmit or hAS submitted to a polygrAph
examination. •
It is our view that in this any rcfaranca to a polyqraph
examination is inadmis8ible. Oni;.d &total v, Candal!, 870
4gS (oth Cir. 1989); United itatea y. Bgwln, 857 F.2d 133' (ith
Cir. 1988)1 Itown v, Dorgy, 783 r.ad 1389 (9th eir. 1986).
Plea •• advise U8 of your intant1Qns in this raqara sacn as
pCIiI1iI1:1a.
co: P. Feldman, E8q.
Micha&l L. Fayad, Eaq.
Charla. R. Sray.r, Elq.
Sincerely,
Laurence A. or;an.on
Ch1af, FrAud Seoe1on
criminal Oivision
!y:

scott w.' MaCKay r
Trial Attornay
COMPANY.
a. AND DID YOU DISCUSS WITH MR. IACOBUCCI THE PERCENTAGES THAT
POLO AND THE LOCAL COMPANY WOULD RECEIVE?
A. WELL. I DISCUSSED TO HIM THAT THE LOCAL C.OMPANY SHOULD
RECEIVE FIVE PERCENT OF WHATEVER COMMISSIONS MIGHT BE WORKED"OUT
AND THAT POLO WOULD RECEIVE 10 PERCENT. AND THE REASON POLO
WOULD GET 10 PERCENT IS BECAUSE ALFONZO WOULO GET FIVE PERCENT.
SO HE WOULD BE GETTING IT FROM BOTH ENDS.
a. SO YOU TOLD MR. IACOBUCCI THAT YOU ALSO WOULD PAY MR. LOPEZ
FROM YOUR 10 PERCENT TO POLO?
A. RIGHT. RIGHT.
a. YOU INDICATE A MOMENT AGO YOU DISCUSSED WHAT YOU
CHARACTERIZED AS INCIDENTAL FEES OR SLUSH FUNDS?
A. CORRECT.
a. WOULD YOU EXPLAIN TO THE JURY. PLEASE. WHAT IT IS THAT YOU
TOLD MR. IACOBUCCI WITH RESPECT TO THOSE?
A. WELL. BELIEVED THAT THE FOUR THOUSAND DOLLARS OR SO A
MONTH THAT WAS GOING TO OPERATE ON WASN'T THAT MUCH IF
WASN'T GOING TO GET EXPENSES TO GO BACK AND FORTH. SO I CREATED
THIS IDEA OF A SLUSH FUND OR INCIDENTAL FEE SO THAT I CAN, IN
EFFECT, GET MORE MONEY FOR ~ S E L F .
AS I EXPLAINED TO IT TO JACK, IT CAME OUT THAT IT WAS TO
TAKE CARE OF SOME LOCAL OFFICIALS IN COLUMBIA. LOCAL TELECOM
OFFICIALS, BUT I REALLY, AT THAT MOMENT IN TIME, HADN'T INTENDED
TO PASS ANY MONEY TO ANYBODY.
i!': ..
~
li" .
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
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Q. AND WHAT DID YOU TELL MR. IACOBUCCI THAT THIS MONEY WOULD
BE PAID FOR?
A. TO TAKE CARE OF -- TO CARE. EXCUSE ME. OF LOCAL
GOVERNMENT OFFICIALS. INCLUDING ANYBODY IN TELECOM THAT MIGHT
HAVE TO BE TAKEN CARE OF. AND ALSO ALFONSO LOPEZ WOULD SHARE IN
THOSE FEES.
MR. FELDMAN: I'M SORRY. I MISSED THE LAST TWO
WORDS.
THE WI TNESS : MR. LOPEZ WOULD ALSO SHARE IN THOSE
FEES.
BY MR. MAC KAY:
Q. AND WHAT FEES WOULD THOSE?
A. THE INCIDENTAL FEES OR SLUSH FUNDS. WHATEVER I SET UP.
Q. YOU INDICATED AT THE TIME IT WAS NOT YOUR INTENT TO PAY
THOSE INCIDENTAL FEES OR SLUSH FUNDS TO ANYONE?
A. THAT'S CORRECT.
Q. DID YOU THINK THAT IT MIGHT BECOME NECESSARY
MR. FELDMAN: OBJECT. IRRELEVANT.
THE COURT: SUSTAINED.
BY m. MAC KAY:
Q. DID YOU IN FACT REACH AN AGREEMENT WITH MR. IACOBUCCI AT
THIS MEETING?
m. FELDMAN: OBJECT. HE MAY SAY WHAT MR.
24 IACOBUCCI SAID.
THE COURT: OR HE MAY TESTIFY TO WHETHER HE
ROSITA FLORES. COURT REPORTER. USDC
THINKS HE HAD AN AGREEMENT.
BY PJR. MAC KAY:
Q. LET ME STRIKE THAT.
HOW LONG DID THIS MEETING TAKE, MR. O'HARA?
A. DON'T THINK IT TOOK MORE THAN A HALF HOUR OR 35 MINUTES,
AT THE TOPS.
Q. AND AT THE END OF THE MEETING. WHAT. IF ANYTHING, DID MR.
IACOBUCCI SAY TO YOU?
A. HE INDICATED THAT HE WOULD LIKE TO DO BUSINESS BUT
HE'S A A TWO-BILLION DOLLAR CORPORATION AND HE COULDN'T DO IT ON
A HANDSHAKE. THAT I SHOULD -- I SHOULD WRITE DOWN THE TERMS
THAT DISCUSSED AND FORWARD IT TO HIM FOR HIS ATTORNEYS TO
LOOK OVER.
Q. NOW, MR. O'HARA, WHAT IS IT THAT YOU INTENDED TO DO WITH
THESE INCIDENTAL FEES?
A. PUT THEM IN MY POCKET. IF IT WAS NECESSARY IN COLUMBIA,
WHICH I DIDN'T BELIEVE IT WOULD BE. I WOULD HAVE TAKEN CARE OF
WHATEVER --
MR. FELDMAN:
EXCUSE ME. MOVE TO TO STRIKE THE
"WHATEVER" FROM THE WITNESS'
THE COURT: IT MAY BE STRICKEN.
WOULD YOU ASK THE QUESTION AGAIN SO MR. O'HARA CAN ANSWER
IT.
BY MR. MAC KAY:
It 25

Q.
MR. O'HARA, WHAT WAS YOUR INTENT WITH RESPECT TO THESE
ROSITA FLORES, COURT REPORTER. USDC
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O'HARA -
5-786
THE COURT: LET ME SEE THE NOTES I NCAMERA.
MR. MAC KAY: THIS AFTERNOON I WILL BE ABLE TO
3 GIVE THEM TO YOU.
THE COURT:
OKAY. ALL RIGHT.
ARE READY FOR THE JURY?
4
5
6
MR. FELDMAN:
NOT QUIET. THEY ARE TRYING TO
7 CORRELATE THE ORIGINAL EXHIBITS WITH OURS.
8 (PAUSE.)
9 (THE FOLLOWING PROCEEDINGS HELD IN THE PRESENCE OF
10 THE JURY:)
1 1
12
MR. FELDMAN:
THE COURT:
MAY I BEGIN?
OH. YES. I'M SORRY. ALL RIGHT. YES
13 GO AHEAD.
14 CROSS-EXAMINATION
15 BY MR. FELDMAN:
16
17
18
19
20
21
22
Q.
A.
Q.
A.
Q.
HOW DO YOU FEEL?
FEEL FINE.
YOURSELF?
I'M OKAY.
YOU NEVER PA'ID ANYBODY ANY BR I BES IN COLUMB I A, 0 10 YOU?
NEVER.
AND HARRIS NEVER BID ON ANY GOVERNMENT CONTRACTS IN
23 COLUMBIA, TO YOUR KNOWLEDGE?
24
25
A.
Q.
TO MY KNOWLEDGE, THEY HADN'T.
AND, UNFORTUNATELY, YOU DIDN'T GET THEM ANY BUSINESS;
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
5-787
O' HARA - CROSS /

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RIGHT?
A.
O.
DID I GET HARRIS CORP -- NO.
AND YOU, UNFORTUNATELY, EVEN ABLE TO GET THEM
4 COMMERCIAL BUSINESS IN MAY, JUNE OR JULY, YOU?
5
6
7
8
A. NO, SIR.
MR. MAC KAY:
MR. FELDMAN:
THE WITNESS:
WHAT YEAR. MR. FELDMAN?
ANY YEAR?
NO, SIR.
9 BY MR. FELDMAN:
10 o.
AND YOU HADN'T SEEN ANY SPECS BEFORE THE TRIP THAT FRANK
11 AND JOE TOOK TO COLUMBIA, HAD YOU, ACTUAL SPECS?
12
13
A.
O.
NO.
AND YOU NEVER DISCUSSED BRIBING -- YOU NEVER PAYING ANY
14 MONEY TO ANY TELECOM OFFICIAL WITH ANY TELECOM OFFICIAL, DID
15 YOU?
16
17
A.
O.
NO.
IN FACT, YOU MET, WHAT IS IT, JORGE CORTAZAR. AT
18 IS THAT RIGHT?
19
20
A.
O.
YES.
AND THEN TELL THE JURY THE NAME OF ANY OTHER TELECOM
21 OFFICIAL YOU MET THE TIME WHEN ANGULO INTRODUCED YOU AND
22 AT THE --
23
24
25
A.
O.
A.
I'M SORRY. THE TIME WHO?
SORRY. ANGULO INTRODUCED YOU TO CORTAZAR?
THAT'S CORRECT.
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
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O'HARA - CROSS/fELDMAN
6-930
HOPE WE'RE NOT GOING TO HAVE TO, BUT THERE'S A POSSIBILITY WE
MIGHT. SO I JUST WANTED TO TELL YOU THAT AHEAD Of TIME.
THE OTHER SCHEDULING MATTER IS WE WILL CONCLUDING AT
12:30 TODAY, INSTEAD Of 1:30. THE REASON IS MY FAULT. I HAVE A
MEETING WITH THE CHIEF JUDGE AND SOME VISITING JUDGES FROM
CANADA. SO I HAVE TO DEPART AT 12:30.
SO WITH THAT WE WILL RESUME THE TESTIMONY OF MR.
O'HARA.
MR. O'HARA, YOU'RE STILL UNDER OTHER FROM YOUR PRIOR
DAY'S TESTIMONY.
ROBERT O'HARA. PLAINTIFF'S WITNESS. PREVIOUSLY SWORN
CROSS-EXAMINATION (RESUMED)
MR. fELDMAN: (TRANSPARENCY PROJECTED ON SCREEN.)
Q. DEfENDANTS' 302 IN EVIDENCE IS SOMETHING YOU SENT TO HARRtS;
RIGHT?
A. I -- I DIDN'T HEAR YOUR QUESTION.
Q. DEFENDANTS' 302 IN EVIDENCE IS SOMETHING THA[ YOU SENT TO
HARRIS; RIGHT?
A. CORRECT.
Q. AND YOU SAID: VOUCHERS FOR FEBRUARY AND MARCH, 1989,
EXPENSES fOLLOW.
(INDICATING AT SCREEN.)
RIGHT?
A. IT APPEARS THAT'S WHAT I PUT DOWN.
Q. THAT -- THAT WASN'T A CODE fOR ANYTHING, WAS IT?
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
6-931
1 A. EXPENSES?
2 Q. YEAH.
3 THAT WASN'T A CODE FOR ANY KIND OF BRIBERY, WAS IT?
4 A. NOT THAT I'M AWARE OF.
5 Q. (PROJECTED TRANSPARENCY CHANGED.)
6 THE SECOND PAGE OF THE SAME EXHIBIT SAYS: FOR
7 EXPENSES DURING TRIP TO BOGOTA ON BEHALF OF HARRIS ••• (COUNSEL
8 INDICATING AT SCREEN) •••• FEBRUARY THROUGH -- FEBRUARY 9TH
9 THROUGH FEBRUARY 16TH, FOUR THOUSAND.
10 RIGHT?
11 A. CORRECT.
12 Q. AND: EXPENSES FOR TRIP PLANNED TO BOGOTA, MARCH 9TH THROUGH
13 MARCH 19TH, FOUR THOUSAND DOLLARS.
14 (COUNSEL INDICATING AT SCREEN.)
15 RIGHT?
16 A. CORRECT.
17 Q. lHAT'S -- THAT'S NOT A CODE FOR BRIBERY, IS IT?
18 A. NOT THAT I'M AWARE OF.
19 Q. YOU HAD THOSE EXPENSESi RIGHT?
20 YOU WERE IN -- YOU WERE GOING TO INCUR EXPENSESJ
21 RIGHT?
22 A. WELL, SURE. I WAS PLANNING ON GOING TO BOGOTA. I NEEDED
23 MONEY TO TRAVEL.
24 Q. AND YOU WERE ENTITLED TO THAT FOUR THOUSAND DOLLARS, YOU
25 THOUGHT; RIGHT?
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
6-932
1 A. I DIDN'T SEE WHY NOT. I -- I HAD AN AGREEMENT WITH JACK FOR
2 IT.
3 Q. BOTH. FOUR THOUSAND FOR FEBRUARY AND FOUR THOUSAND FOR
4 MARCH; RIGHT?
5 A. THAT'S CORRECT.
6 Q. YOU HAD NOT ONLY TRIPS TO BOGOTA, BUT TWO TRIPS TO
7 CALIFORNIA; RIGHT?
8 A. TRUE.
9 Q. (PROJECTED TRANSPARENCY CHANGED.)
10
11
INCIDENTAL FEES OF FIFTY-FIVE HUNDRED.
THIS IS SUPPOSED TO BE A BRIBE; RIGHT?
12 A. SUPPOSEDLY, YEAH.
13 Q. SO YOU HAD EXPENSES OF FOUR THOUSAND IN FEBRUARY, FOUR
14 THOUSAND IN MARCH, A BRIBE OF FIFTY-FIVE HUNDRED; YOU WERE LEFT
15 WITH NOTHING.
16 RIGHT?
17 A. I DON'T -- I DON'T r0LLOW WHAT YOU MEAN -I WAS LEFT WITH
18 NOTHING-.
19 Q. WELL, YOU HAD FOUR THOUSAND DOLLARS WORTH OF EXPENSES IN
20 FEBRUARY; RIGHT?
21 A. WELL, THAT'S WHAT I WROTE.
22 Q. AND YOU HAD -- YOU WERE GOING TO HAVE FOUR THOUSAND WORTH OF
23 EXPENSES IN MARCH; RIGHT?
24 A. WELL, THAT'S THE WAY IT -- IT WAS WRITTEN.
25 Q. AND THEN YOU WANTED -- YOU'RE SAYING THAT WHAT YOU TOLD
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
6-933
1 HARRIS IS YOU WANTED FIFTY-FIVE HUNDRED FOR A BRIBE; RIGHT?
2 A. PARTIALLY, YEAH.
3 Q. SO YOU WOULD BE LEFT WITH NOTHING. YOU HAVE -- FOUR
4 THOUSAND A MONTH GOES OUT, FIFTY-FIVE HUNDRED YOU GIVE AWAY, AND
5 YOU HAVE NOTHING.
6 THAT'S WHAT THIS SAYS; RIGHT?
7 A. WELL, I GUESS IT COULD BE INTERPRETED THAT WAY.
8 Q. AND, IN FACT, THEY DIDN'T EVEN GIVE YOU THE FOUR THOUSAND
9 FOR MARCH ON MARCH 8TH, DID THEY?
10 A. I DON'T RECALL.
11
THEY MAY OR MAY NOT HAVE. I DON'T RECALL.
12 Q. WELL, MR. O'HARA, HOW MUCH MONEY DID THEY WIRE YOU ON MARCH
13 8TH?
14 A. I DON'T BELIEVE THEY WIRED ME ANY MONEY ON MARCH 8TH.
15 Q. HOW ABOUT MARCH 9TH?
16 A. MARCH 9TH I THINK THEY WIRED ME NINETY-FIVE HUNDRED DOLLARS.
17 Q. 50 ACCORDING TO YOUR TESTIMONY YOU WERE GOING TO -- YOU LET
18 HARRIS THINK, AND YOU BELIEVE THAT YOUR AGREEMENT WITH THEM WAS,
19 THAT YOU WERE GOING TO GO INTO YOUR POCKET FOR THE BRIBE MONEY,
20 IS THAT IT?
21 YOU WERE GOING TO LAY OUT THE BRIBE MONEY. IS THAT
22 IT?
23 A. IS WHAT -- I'M NOT FOLLOWING YOU.
24 Q. YOU HAD FOUR THOUSAND IN FEBRUARY, FOUR THOUSAND IN MARCH --
25 A. UH-HUH.
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
1 Q.
AND FIFTY-FIVE HUNDRED IN BRIBE MONEY: RIGHT?
2 THAT'S THE TESTIMONY.
3 A. RIGHT.
4
5
6
MR. FELDMAN: MAY I APPROACH THE WITNESS?
THE COURT: YES. AND CALM DOWN A LITTLE.
MR. FELDMAN: (COUNSEL AT WITNESS STAND WITH
7 DOCUMENT S • )
6-934
8 Q. GOVERNMENT'S 50 IS IN EVIDENCE, AND IT'S A FAX THAT YOU SENT
9 TO FRANK THOMPSON: RIGHT?
10 A. THAT'S CORRECT.
11 Q. IN IT YOU ASK FOR FOUR THOUSAND DOLLARS AS A MONTHLY FEE;
12 RIGHT?
13 A. CORRECT.
14 Q. THAT'S FOR MARCHi RIGHT?
15 A. THAT'S WHAT IT'S MARKED.
16 Q. AND THAT -- THAT INVOICE IS DATED MARCH 24TH, ISN'T IT?
17 A. YES, IT IS.
18 Q. GOVERNMENT'S 67 IN EVIDENCE IS AN INVOICE WHICH YOU SENT TO
19 DTS, ISN'T IT?
20 A. THAT'S TRUE.
21 Q. WITHOUT THE PENCILED HANDWRITING: CORRECT? THE PENCILED
22 HANDWRITING IS NOT YOURS, IS IT?
23 A. NO, IT'S NOT.
24 Q. AND IN THIS INVOICE, DATED •••• A FAX LINE OF APRIL 11TH, YOU
25 ASK FOR A MONTHLY FEE OF FOUR THOUSAND DOLLARS; RIGHT?
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
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O'HARA - CROSS/FELDMAN
6-935
A. CORRECT.
Q. YOU REFER TO THE FOUR THOUSAND DOLLARS THERE AS A FEE;
RIGHT?
A. TRUE.
Q. IN THE ••• GOVERNMENT 50 ON MARCH 24TH YOU ASK FOR A FEE
YOU DESCRIBE THE FOUR THOUSAND DOLLARS AS A MONTHLY FEE;
CORRECT?
A. TRUE.
Q. DEFENDANTS' 368 IS SOMETHING THAT YOU SENT TO HARRIS;
CORRECT?
A. TRUE.
Q. LOOK AT ALL THE PAGES, PLEASE.
A. (WITNESS REVIEWING DOCUMENTS.)
Q. YOU SENT THAT ENTIRE EXHIBIT TO HARRIS, DID YOU NOT?
A. TRUE.
MR. FELDMAN: YOUR HONOR, I -- I WOULD MOVE
DEFENDANTS' 368.
MR. MAC KAY: CAN I TAKE A LOOK AT IT?
I DON'T THINK I HAVE A COPY.
(COUNSEL MOVING TO WITNESS STAND, REVIEWING DOCUMENT.)
THANK YOU.
NO OBJECTION.
THE COURT: 368 MAY BE ADMITTED.
CARL R. PLINE
(DEFENDANTS' EXHIBIT NO. 368
RECEIVED INTO EVIDENCE.)
OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
~ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
O'HARA - CROSS/FELDMAN
6-936
1 BY MR. FELDMAN:
2 Q. GOVERNMENT'S 69 IS ••• MINUS THE HANDWRITING, SOMETHING THAT
3 YOU SENT TO HARRIS, IS IT NOT?
4 A. (PAUSE WHILE WITNESS REVIEWING DOCUMENTS.)
5 YES, IT IS.
6 Q. AND IN IT YOU REFER TO THE FOUR THOUSAND DOLLARS ••• AS A
7 MONTHLY FEE, DO YOU NOT?
8 A. YES, I DO.
9 Q. GOVERNMENT'S 57 IN EVIDENCE IS SOMETHING YOU SENT TO HARRIS,
10 IS IT NOT?
11 A. YES, IT IS.
12 Q. AND IN IT YOU REFER TO THE FOUR THOUSAND DOLLARS AS PAC'S
13 MONTHLY FEE, DO YOU NOT?
14 A. TRUE.
15 Q. DEFENDANTS 369 IS SOMETHING THAT YOU SENT TO HARRIS, IS IT
16 NOT?
17 A. (WITNESS REMEMBER REVIEWING DOCUMEtHS.)
18
19
20
21
22
23
24
YES, IT IS.
MR. FELDMAN: I WOULD OFFER 369, YOUR HONOR.
MR. MAC KAY: NO OBJECTION.
THE COURT: 369 WILL BE ADMITTED.
BY MR. FELDMAN:
(DEFENDANTS' EXHIBIT NO. 369
RECEIVED INTO EVIDENCE.)
25 Q. AND IN IT YOU REFER TO YOUR THIRTY-FIVE HUNDRED IN MAY -- ON
CARL R. PLINE
OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
6-937
1 MAY 25TH AS A MONTHLY FEE, DO YOU NOT?
2 A. THAT IS AS PER THE CONTRACT I HAD SIGNED, RIGHT.
3 Q. DEFENDANTS 370 IS A -- ANOTHER FAX CONTAINING AN INVOICE
4 THAT YOU SENT TO HARRIS, IS IT NOT?
5 A. YES, IT IS.
6 Q. AND THAT IS A FAX -- I WOULD OFFER DEFENDANTS' 370, YOUR
7 HONOR.
8
9
MR. MAC KAY: NO OBJECTION.
THE COURT: IT MAY BE ADMITTED.
10 (DEFENDANTS' EXHIBIT NO. 370
11 RECEIVED INTO EVIDENCE.)
12 BY MR. FELDMAN:
13 Q. THAT IS A FAX DATED JUNE 28TH. YOU ENCLOSED A FAX THAT
14 SAID: FOR SERVICES RENDERED IN BOGOTA, COLOMBIA, JUNE, 1989,
15 THIRTY-FIVE HUNDRED DOLLARS.
16 CORRECT?
17 A. TRUE.
18 Q. (COUNSEL RETURNING TO LECTERN. TRANSPARENCY PROJECTED ON
19 SCREEN.)
20 SO YOU DESCRIBE THE FIFTY-FIVE HUNDRED -- ON THE MARCH
21 8TH FAX, YOU SAID THAT THERE WAS A VOUCHER FOR SERVICES RENDERED
22 IN BOGOTA ATTACHED TO THE MARCH 8TH FAX; RIGHT?
23 A. TRUE.
24 Q. AND THAT'S WHAT THE INCIDENTAL FEES WERE; RIGHT?
25
RIGHT?
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/FELDMAN
6-938
1 THIS FIFTY-FIVE THOUSAND -- OR FIFTY-FIVE HUNDRED IS
2 FOR THE INCIDENTAL FEES; RIGHT?
3 A. WELL, IT'S THE MONEY TO TAKE CARE OF PEOPLE.
4 Q. RIGHT. THIS IS
5 A. IT'S INCIDENTAL FEES, RIGHT.
6 Q. THIS IS THE INCIDENTAL FEES THAT YOU HAD THIS AGREEMENT
7 WITH -- THIS MEETING OF THE MINDS WITH JACK ABOUT; RIGHT?
8 A. ABSOLUTELY.
9 Q. NO QUESTION ABOUT IT; RIGHT? MEETING OF THE MINDS.
10
11
12
13
14
THAT'S WHAT YOU HAD.
YOU HAD A REAL GOOD MEETING OF THE MINDS; RIGHT.
MR. MAC KAY: OBJECTION, YOUR HONOR.
ASKED AND ANSWERED.
MR. FELDMAN: NO, I -- THIS IS CROSS-EXAMINATION, AND
15 IT'S IMPORTANT.
16
THE COURT: IT IS, BUT IT'S GOTTEN ARGUMENTATIVE AND
17 NOT CROSS-EXAMINATION.
18 BY MR. FELDMAN:
19 Q. YOU HAD --
20
21
THE COURT: THE OBJECTION IS SUSTAINED.
MR. FELDMAN: YES.
22 Q. YOUR MEETING OF THE MINDS WAS VERY FIRM, WASN'T IT?
23 A. WELL, IN MY MIND IT WAS, YES.
24 Q. ALL RIGHT.
25
AND LET
LET ME ASK YOU, MR. O'HARA: THIS PHRASE
CARL R. PLINE
OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/CHANIN
6-990
1 Q. YOU ALSO TOLD THE FBI ON SEPTEMBER 28TH, 1989, THAT PAYING
2 LOPEZ WAS NOT DISCUSSED WITH MR. IACOBUCCI.
3 DO YOU RECALL THAT?
4 A. I'M SORRY, THAT WHAT?
5 Q. THAT PAYING LOPEZ WAS NOT DISCUSSED WITH MR. IACOBUCCI.
6
DO YOU RECALL THAT?
7 A. AGAIN, I •••• I HAVE TO TELL YOU THAT I MIGHT HAVE SAID
8 SOMETHING LIKE THAT. I'M NOT REAL CLEAR ON IT.
9 Q. SO YOU TOLD THE FBI THAT YOU ASKED FOR DISCRETIONARY FUNDS
10 TO ARRANGE MEETINGS; AND THAT YOUR EFFORTS TO ARRANGE A MEETING
11 EVENTUALLY TOOK THE FORM OF THE COCKTAIL PARTY AT THE BOGOTA
12 ROYAL HOTEL ON MARCH 14TH, AT WHICH THE RIGHT PEOPLE WERE
13 PRESENT.
14 DO YOU REMEMBER THAT?
15 A. AGAIN I -- I WOULD SAY I PROBABLY SAID WORDS TO THAT EFFECT.
16 Q. UH-HUH.
17 AND YOU INCURRED WHAT, THREE THOUSAND TWO HUNDRED AND
18 FORTY DOLLARS OF EXPENSES AT THE BOGOTA ROYAL HOTEL, INCLUDING
19 THE CHARGES FOR THE COCKTAIL PARTY?
20 A. YEAH. I BELIEVE IT CAME TO SOMETHING LIKE THAT.
21 Q. AND YOU -- YOU ALSO HAD SOME INCIDENTAL EXPENSES FOR
22 PRINTING AND SENDING INVITATIONS, AND RESTAURANTS, AND TRAVEL
23 AROUND BOGOTA?
24 A. SURE. WHATEVER EXPENSES WERE ON THE -- THEY WERE ALL
25 INCURRED ON BEHALF OF HARRIS.
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
O'HARA - CROSS/CHANIN
6-991
1 Q. AND YOU TESTIFIED ON TUESDAY THAT YOU ALSO HAD SOME
2 DISCUSSION WITH MR. IACOBUCCI IN JANUARY ABOUT EXPENSES FOR
3 TRAVEL; RIGHT?
4 A. TRUE.
5 Q. AND THAT'S BECAUSE YOU BELIEVED THAT THE FOUR THOUSAND
6 DOLLAR MONTHLY FEE THAT YOU ASKED FOR AS A CONSULTING FEE WASN'T
7 GOING TO LEAVE YOU ANYTHING AFTER TRAVEL EXPENSES.
8 A. TRUE.
9 Q. OKAY.
10 COULD YOU TELL THE JURY WHAT KIND OF INCIDENTAL TRAVEL
11 EXPENSES YOU ACTUALLY INCURRED ON YOUR -- ON YOUR TRIPS TO
12 CALIFORNIA TO VISIT WITH DTS, AND YOUR TRIPS DOWN TO COLOMBIA?
13 A. IN TOTAL?
14 Q. JUST TELL THEM THE KINDS OF EXPENSES THAT YOU HAD TO GO OUT
15 TO CALIFORNIA, MEET WITH DTS PEOPLE; GO DOWN TO COLOMBIA, CHECK
16 OUT THE OPPORTUNITY.
17 A. WHAT KIND OF EXPENSES?
18 Q. YEAH.
19 A. NORMAL BUSINESS TRAVEL EXPENSES; HOTEL, AIR FARE, CAR
20 RENTAL, MEALS. ENTERTAINMENT. PRINTING. TELEPHONE.
21
AM I LEAVING SOMETHING OUT?
22 Q. I DON'T KNOW. ANY OTHERS THAT YOU CAN REMEMBER?
23 A. WELL, TO THE BEST OF MY RECOLLECTION THAT'S WHAT THE
24 BUSINESS EXPENSES WOULD HAVE BEEN.
25 Q. OKAY.
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
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WILLIAM T. McGIVERN, JR.
United States Attorney
Scott W. MacKay
Peter Loewenberg
Trial Attorneys
Fraud Section, Criminal Division
U.S. Department of Justice
1400 New York Avenue, N.W.
Washington, D.C. 20005
(202) 514-0880
~ ... 1 ,-,
\ .... \JL"\ •
. ~ , r " 1-
-c . ; ~ :-\,l\ ~ ' c ) . 'e,;;':. '- ,
7 Attorneys for the United States
8 UNITED STATES DISTRICT COURT
9 NORTHERN DISTRICT OF CALIFORNIA
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r 15
V
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UNITED STATES OF AMERICA,
Plaintiff,
v.
HARRIS CORPORATION,
JOHN D. IACOBUCCI, and
RONALD L. SCHULTZ,
) CR No. 90-0456 CAL
)
)
)
)
) GOVERNMENT'S MEMORANDUM
) IN ANTICIPATION OF DEFENDANTS'
) MOTION FOR A JUDGMENT OF
) ACQUITTAL PURSUANT TO RULE
) 29
)
Defendants. )
________________________________ ) COURT: Hon. Charles A. Legge
18 I. Introduction
19
The United States of America, by counsel, respectfully
20 submits this memorandum in anticipation of defendants' motion for a
21
judgment of acquittal pursuant to Fed. R. Crim. P. 29(a).
The
22 purpose of this memorandum is to demonstrate that the evidence
23 presented in the Government's case-in-chief is sufficient to sustain
24 a conviction of each defendant for each count charged in the
25 indictment.
26
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Rule 29 ( a) requires the Court to grant a motion for a
judgment of acquittal "if the evidence is insufficient to sustain a
conviction." The Court must determine whether, viewing the evidence
in the light most favorable to the Government, the jury could
reasonably find the defendants guilty beyond a reasonable doubt.
United States v. Merriweather, 777 F.2d 503, 507 (9th Cir. 1985),
cert. denied, 475 U.S. 1098 (1986); United States v. Hazeem, 679 F.2d
8 770 (9th Cir. 1982), cert. denied, 459 U.S. 848 (1982). In making
9 its determination, the Court must resolve all factual disputes and
10 draw all reasonable inferences from the evidence in favor of the
11 Government. United States v. Beecroft, 608 F.2d 753, 759 (9th Cir.
12 1979); see Glasser v. United States, 315 U.S. 60, 80 (1942).
13 The Government's evidence has proved beyond a reasonable
14 doubt that:
15 1. As charged in Count One, the defendants conspired with
16 Robert D. O'Hara (O'Hara), d/b/a Polo Associates Corp., Inc. (Polo),
17 to authorize the payment of and to pay O'Hara while knowing that
18 O'Hara would pay, offer, or give a portion of that money to certain
19 officials of the Government of Colombia, that is Colombian
20 Congressman Lopez and unidentified and unknown officials of the
21 Colombian national telephone agency, Telecom;
22
2. As charged in Count One, the defendants further
23 conspired with O'Hara to falsify the books, records and accounts of
24 Harris by failing to reflect in those books, records, and accounts
25 that a portion of the money paid by and authorized to be paid by
26 defendants to O'Hara was, in fact, to be paid or offered to officials
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of the Colombian government;
3. The defendants corruptly made an interstate telephone
call (Count Two) and caused and directed two interstate wire
transfers of money in furtherance of the payment and authorization
of the payment of $22,845 to O'Hara (Counts Three and Four) knowing
that O'Hara would payor offer a portion of that money to Congressman
Lopez and officials of Telecom so that those officials would use
their influence in order to obtain telecommunications contracts for
Harris and DTS with the Government of Colombia; and
4. As charged in Count Five, the defendants knowingly and
11 willfully falsified the books, records and accounts of Harris
12 Corporation by creating and causing the creation of certain check
13 request forms and wire transfer and expense journal entries, which
14 failed to reflect that a portion of the money paid by and authorized
15 to be paid by defendants to O'Hara was, in fact, to be paid or
16 offered to officials of the Colombian government.
17 In each case, the liability of defendant Harris Corporation
18 is premised upon the acts, omissions, and declarations of defendants
19 Iacobucci and Schultz within the scope of their authority as
20 employees or agents of Harris Corporation, as discussed in detail
21 below.
22 I I . Conspiracy
23
24
25
A. Authorization of Payment and Payment of Money to O'Hara
Knowing He Would Pay a Portion of That Money to Congressman
Lopez and Officials of Telecom.
The conspiracy charged in Count One began on or about
26 January 13, 1989 when O'Hara met with defendant Iacobucci at the
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offices of Warren Kremer Associates, an advertising agency in New
York City. Tr. 4-577. At this meeting, O'Hara made it clear to
Iacobucci that he was proposing an illegal agreement: "I told him
that what I was about to tell him I wouldn't repeat in front of
anybody ... [b]ecause I thought that it may not be quite aboveboard
to do what I was about to propose to do." Tr. 4-580.
O'Hara then outlined the details of his criminal scheme to
8 bribe foreign officials of the Government of Colombia to obtain
9 telecommunications contracts for Harris Corporation. First, O'Hara
10 told Iacobucci that Alfonso Lopez Caballero was a Colombian
11 congressman and was O'Hara's friend. Tr. 4-583. Lopez's status as
12 a Colombian congressman in January 1989 was independently established
13 through the testimony of Consuela Alarcon. Tr. 1-37-38. Next, in
14 furtherance of the conspiracy to bribe foreign officials, O'Hara
15 stated that Congressman Lopez would use his influence with Telecom
16 to help O'Hara and Harris to obtain telecommunications contracts
17 available from the Colombian government and Telecom. Tr. 4-583-84;
18 5-704. Consuela Alarcon also established that Telecom was an
19 instrumentality of the Colombian government. Tr. 1-28.
20 O'Hara advised Iacobucci that Congressman Lopez would have
21 an ownership interest in a local Colombian company to be appointed
22 by Harris as its local representative. Tr. 4-584-85. O'Hara
23 indicated that Congressman Lopez would receive a proposed 5%
24 commission to be paid to the local Colombian company from any
25 contracts obtained. Additionally, O'Hara would pay Congressman Lopez
26 a portion of the 10% commission that 0 'Hara proposed Polo would
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receive from any contracts obtained by Harris from the Colombian
government. Tr. 4-585.
O'Hara also told Iacobucci that he would need to be paid an
"incidental fee" or "slush fund" to be able "to take care of people
in the government down there [Colombia] . . " Tr. 4-584. O'Hara
testified, "As I explained it to Jack [Iacobucci], it came out that
7 it was to take care of some local officials in Colombia, local
8
Telecom officials
" Tr. 4-585. O'Hara further testified that
9 he told Iacobucci that the incidental fees or slush fund were "to
10 take care of -- to take care . of local government officials,
11 including anybody in Telecom that might have to be taken care of, and
12 also Alfonso Lopez would share in those fees." Tr. 4-586; 5-705.
13 Iacobucci agreed to O'Hara's proposal by responding, "We do
14 business allover the world. We're a two billion dollar corporation.
15 We know how business is done." Tr. 5-705. O'Hara testified that he
16 "thought that we [O'Hara and Iacobucci] had a meeting of the minds.
17 We shook hands. He said that he would like to do business in
18 Colombia." Tr. 5-826. O'Hara further testified that his "meeting
19 of the minds" with Iacobucci was "very firm." Tr. 6-938.
20 At this time, O'Hara believed that he had an agreement with
21 Congressman Lopez that Congressman Lopez would use his influence to
22 obtain business for O'Hara and Harris. Tr. 4-570. In return for
23 that influence, O'Hara intended to pay Congressman Lopez a share of
24 whatever profits were generated by any such business obtained. Tr.
25 4-570. The extent of this illegal agreement is corroborated by the
26 subsequent selection of Interdelta, a company in which Lopez had an
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ownership interest, Tr. 1-34, GX. 1, as Harris' local representative.
Tr. 5-710, GX. 6 . Moreover, the substitution of Compania
Metropolitana for Interdelta as the local Colombian representative
for Harris, at the direction of Congressman Lopez, further
corroborates the extent to which Congressman Lopez was conspiring
6 with O'Hara to violate the FCPA. Tr. 5-891 ("Alfonso [Lopez] told
7 me that Metropolitana would be the new company."). Tr. 5-755-56
8 (O'Hara understood that Congressman Lopez had an ownership interest
9 in Compania Metropolitana). Accordingly, 0' Hara clearly had the
10 requisite criminal intent necessary to establish a conspiracy to
11 bribe Congressman Lopez with the 5% commission payments to the local
12 representative and a portion of the 10% commission payments to Polo.
13 With regard to the payment of the incidental fees, O'Hara
14 did not intend to pay these fees to Lopez but did intend, if
15 necessary, to pay such fees to officials of Telecom. Tr. 4-588; 5-
16
877. His intention to pay the incidental fees to officials of
17 Telecom is sufficient to establish O'Hara's criminal intent with
18 respect to the conspiracy to bribe unknown officials of Telecom
19 charged in the indictment. See Indictment, ~ ~ B.1., C.1., C.6. -
20 C. 7 .
21
Iacobucci confirmed his willful participation in the
22 conspiracy to bribe Congressman Lopez and officials of Telecom when
23
he told Peter Wang on January 16, 1989 that:
"
. he [Iacobucci
24 had met a man in New York . [who] ... had connections with the
25 Government of Colombia, and could help us get business in that
26 country. He [Iacobucci] then went on to say that he wanted me to
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take off my legal hat and put on my business hat. Look the other way
. is what he said." Tr. 2-95-96. Iacobucci further confirmed
his participation in the conspiracy when he stated to Wang on March
8, 1989 that with regard to the money being paid to O'Hara and the
5 Colombians: "... some of it is fees and some of it is a, and he
6 went like this. (indicating). He went 'swish,' He made the 'swish'
7 (indicating). And gestured it with his hand, like this (indicating)
8
" Wang demonstrated and testified that Iacobucci used a gesture
9 meaning "under the table" or a "bribe." Tr. 2-126.
10
Further evidence of an agreement between O'Hara and
11 Iacobucci to violate the FCPA is circumstantial. Despite learning
12 ,from Alejandro Jimenez, the DTS regional sales manager for Latin
13 America, that Harris' equipment did not qualify for the Colombian
14 government tenders discussed by O'Hara, Tr. 6-1066-67, Iacobucci told
15 Jimenez that "he had found somebody who might be able to do something
16 for us, and if I knew Mr. O'Hara." Tr. 6-1067. Moreover, Jiminez
17 was later excluded from participating in the O'Hara/Colombian
18 transaction. Tr. 6-1072. Additionally, at a lunch in Sausalito in
19 early February, O'Hara told Thompson and Iacobucci that thus far DTS
20 had been going through the front door in trying to get Colombian
21 government business, O'Hara could take them through the back door to
22 get government business. Tr. 4-599. Iacobucci indicated that he
23 wished to proceed with the Colombia deal.
24 Finally, on March 1, 1989, after Wang had advised Schultz
25 that the payment contemplated for O'Hara may be a violation of the
26 FCPA, Iacobucci told Wang, in essence, that he was being fired from
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DTS. Tr. 2-110-11. The reasonable inference to be taken from the
timing of Iacobucci's firing of Wang, particularly in view of Wang's
testimony that he was shocked because no prior indications had been
given to him that he had any problems that would result in his
termination, Tr. 2-111, is that Iacobucci fired Wang because of his
failure to "look the other way" about the O'Hara payments.
Defendant Schultz joined the conspiracy to bribe Congressman
Lopez and officials of Telecom, on March 1, 1989, when he met with
Peter Wang and told him that O'Hara had asked for money and that DTS
10 had agreed to pay. Tr. 2-102. Al though Wang warned Schultz that the
11 payment may be in violation of the FCPA, Tr. 2-104, Schultz continued
12 to take steps to cause that payment to be made. Defendant Schultz's
13 willful participation in the conspiracy became readily apparent on
14 March 8, 1989 when Iacobucci handed him the facsimile from O'Hara,
15 dated March 8, 1989, demanding $8,000 in monthly expense fees and
16 $5,500 in "incidental fees," and directed Schultz to call O'Hara.
17 GX. 5. O'Hara testified that the use of the term "incidental fees"
18 on GX. 5 was a "code" as " ... it was considered by myself and Jack
19 in the initial meeting a way to refer to money to be paid to other
20 people." Tr. 5-838.
21 Schultz then spoke with O'Hara on the telephone on March 8,
22 1989. O'Hara testified about their conversation, stating that:
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Mr Schultz received the fax that I had sent to -
- or was given the fax that I had sent to Mr.
Iacobucci requesting the funds. And ... had a
question about what the fifty-five hundred dollars
were, and how was -- how were they supposed to
record it on their books.
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And I said: You know, that's up to Jack. Jack
certainly knows what it's for. You'd better check
with Jack.
Q. And that was the extent of the conversation?
Not really, because he kept pushing me to tell him
what it was about.
And I said -- finally I said:
funds. It's to -- take care of
a bribe. Let's get the thing
Jack.
Look, I need the
some people. It's
going. Go talk to
Q. And were those the -- can you recall the exact
words that you used with Mr. -- with Mr. Schultz
at that time? What specifically did you tell Mr.
Schultz?
I said it was to take care of people in Colombia.
I said: you'd better check with Jack.
Whether I used the term bribe, or he said 'Do you
mean it's a bribe?' I'm not sure, but the word came
up in the conversation.
Q. And did you tell him what people you were going
to take care of?
I believe I told him it was some people at Telecom
to take care of some specifications that may have
to be altered to be able to get the bid spec in.
Q. And do you recall discussing a switch in that
conversation?
I believe -- I told him it was for a Number Five
Central Office Switch.
Q. And what, if any, response did you have from
Mr. Schultz in that conversation?
Basically, I -- I recall him saying that he would
get back to Jack; and, you know, they would take
care of it.
Tr. 5-724-25.
Following that conversation on March 8, 1989, Wang testified
that Schultz met with him and told Wang that he had spoken with John
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Pollok, who works with O'Hara, (in fact, as demonstrated by the
testimony of O'Hara noted above, it was O'Hara with whom Schultz
spoke) and that Pollok had told Schultz that the money, the
4 incidental fees, were a bribe to the Colombian government
5 authorities. Tr. 2-118. Specifically, Wang testified that Schultz
6 told him" ... that the money to be paid was a bribe and the purpose
7 of the bribe was to have someone in the Colombian government alter
8 the requirement specifications so that it would appear that the
9 Harris equipment would comply, when in fact the Harris equipment does
10 not comply." Tr. 2-119-20.
11 Mr. Wang further testified that at the time Schultz advised
12 him of his conversation with Pollok, Schultz handed Wang GX. 2, the
13 "bribe note", upon which Mr. Schultz had written:
14 "- $5,500 - payment to get documents so wording gets changed
15 so that Harris equipment will be accept
16 - NEC #5 ess
17 - not able to give receipt as bribe
18 - FAX copy to John Pollok
19 212-686-2914
20 O'Hara testified that GX. 2 reflected the subject matter he
21 discussed with Schultz in their telephone conversation on March 8,
22 1989. Tr. 5-727. Moreover, in the consensually monitored telephone
23 conversation between Wang and Schultz on July 7, 1989, Schultz did
24 not deny that he had such a conversation with either O'Hara/Pollok
25 or with Wang:
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PW: Bob O'Hara and John Pollok are, are
asking, ah, Harris to, ah, give the money to bribe,
ah, the government of Colombia to alter those specs
and that was really, ah, rally on my, urn
conscience.
RS: Yeah. But as it turns out, that wasn't really
I guess what they were doing .
***
PW: But, ah, but you know Pollok came right out,
remember, and didn't Pollok just come right out
and tell you that it was a bribe?
RS: No, I think that was kind of my interpretation
of it . . .
The testimony of Wang and O'Hara, together with GX. 2, the
11 "bribe note," make it clear that Schultz willfully joined and
12 participated in the conspiracy to bribe officials of Telecom.
13 Although there is no evidence to directly show that Schultz was aware
14 of the agreement between Iacobucci and O'Hara to bribe Congressman
15 Lopez, his willful and knowing participation in the conspiracy to
16 authorize payments to O'Hara, knowing that O'Hara would pay a portion
17 of that money to Telecom officials to obtain business for Harris,
18 makes him criminally liable for his coconspirators' agreement and
19 acts with regard to the payment of bribes to Congressman Lopez.
20 The testimony of Arthur Widen, the DTS Controller, shows
21 that, in furtherance of the conspiracy, both Iacobucci and Schultz,
22 and thus Harris Corporation, authorized "incidental fee" payments of
23 $5,500 on March 8, 1989 (GX. 81 - Check Request) and $3,000 on May
24 1, 1989 (GX. 82 - Check Request) to O'Hara while knowing, based upon
25 O'Hara's representations to Iacobucci on January 13, 1989 and to
26 Schultz on March 8, 1989, that O'Hara would pay, offer, or give a
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portion of that money to either Congressman Lopez or officials of
Telecom.
Based on these authorizations, on March 9, 1989, the $5,500
was wired from Harris' account at National City Bank in Cleveland,
Ohio to O'Hara's account at Manufacturers Hanover Trust in Brooklyn,
New York (Tr. 5-729-30, GX. 60.) and on May 1, 1989, the $3,000. was
wired from Harris' account at National City Bank in Cleveland, Ohio
to O'Hara's account at Manufacturers Hanover Trust in Brooklyn, New
York (Tr. 5-781/82, GX. 62).
The Government's evidence has established that each of the
overt acts alleged in " D.1. - 17. of the Indictment occurred and
12 that each was in furtherance of the conspiracy. These overt acts
13 include the January 13, 1989 meeting between Iacobucci and O'Hara in
14 New York City; the January 16, 1989 conversation between Iacobucci
15 and Wang; the February 2, 1989 meeting between O'Hara and Iacobucci
16 and Thompson in Sausalito; O'Hara's meeting with Iacobucci and other
17 DTS employees at DTS on February 23, 1989; O'Hara's facsimile to
18 Iacobucci on February 28, 1989 outlining the terms of a consulting
19 agreement (GXs. 7,42); O'Hara's facsimile to Iacobucci on March 8,
20 1989 demanding payment of $5,500 "incidental fees" (GXs. 5,46); the
21 March 8, 1989 telephone conversation between O'Hara and Schultz; the
22 preparation of the "bribe note" (GX. 2) by Schultz on March 8, 1989;
23 the preparation of the check requests by Schultz and Iacobucci
24 requesting payment of $5,500 and $3,000 in "incidental fees" to
25 O'Hara and the wiring of that money from Harris to O'Hara; and,
26 various invoices sent by O'Hara to DTS in April 1989 requesting
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payment of $3,000 in "incidental fees."
B. Conspiracy to Falsify the Books and Records of Harris
Corporation
As previously noted, the Government's evidence has clearly
demonstrated that 0' Hara represented to both Iacobucci (at the
January 13, 1989 meeting in New York City) and to Schultz (during
their telephone conversation on March 8, 1989) that he would "take
care of", or bribe, Congressman Lopez (to Iacobucci only) and
officials of Telecom with the "incidental fees" paid to him by Harris
Corporation. Nonetheless, on March 8, 1989, Schultz and Iacobucci
signed a check request (GX. 81) requesting that $9,500 (of which
$5,500 were "incidental fees") be paid to Polo as "Retainer &
Expenses for Mfg. Representative (Consultant). (Widen testimony,
3/18/91) . Schultz presented this check request to the DTS
Controller, Art Widen, and thereby caused the money wired to O'Hara
to be booked in April 1989 as an international sales expense for Polo
in the DTS general ledger in the account designated "Professional and
Outside Services." (GX. 75; Widen testimony, 3/18/91).
Similarly, on May 1, 1989, while still knowing the true
purpose of "incidental fees," Schultz and Iacobucci signed a second
check request (GX. 82) requesting that $13,345 (of which $3,000 were
"incidental fees" payable for O'Hara's activities in March 1989) be
paid to Polo from an "International Sales" account. (Widen testimony,
3/18/91). Schultz again presented this check request to the DTS
Controller and thereby caused the money wired to O'Hara to be booked
in June 1989 as an international sales expense for Polo in the DTS
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general ledger in the account designated "Professional and Outside
Services." GX. 76; Widen testimoy, 3/18/91).
In each instance, the clear inference to be taken from these
transactions is that Iacobucci and Schultz, knowingly falsified the
check requests and the two DTS general ledger journal entries
reflecting the debits to Polo Associates based on those check
requests (GX. 75 - general ledger detail - 3/31/89; GX. 76 - general
ledger detail - 5/26/89) by failing to reflect, although they knew
it to be a fact, that a portion of the payments to O'Hara were for
10 foreign officials. Instead, the defendants falsely described those
11
expenses as "Retainer & Expenses for Mfg. Representative
12 (Consultant) ," or "International Sales" expenses, or Outside and
13 Professional Services for Polo when they knew full well that such a
14 description was false by omission.
15 Indeed, the testimony of DTS controller, Arthur Widen, on
16 March 18, 1991 made it abundantly clear that it was entirely
17 inappropriate to book the Polo expenses to the International Sales -
18 Outside and Professional Services expense account if part of that
19 expense was for payments to foreign officials. The final false
20 booking of the May 1, 1989 payment of $3,000 of incidental fees, made
21 to the DTS general ledger on June 8, 1989 terminated the conspiracy.
22 III. Counts Two, Three, and Four
23
Based upon the previous recitation of the evidence
24 concerning the conspiracy to violate the FCPA anti-bribery
25 provisions, it is apparent that the Government's evidence is
26 sufficient to sustain a conviction of each defendant for Counts Two,
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Three and Four. In each instance, the defendants caused the use of
or used a means or instrumentality of interstate commerce (Count Two
- the interstate telephone call between Schultz and O'Hara on March
8, 1989, which Iacobucci directed or caused Schultz to make; Counts
Three and Four - the interstate wire of funds between the Harris bank
account in Cleveland, Ohio and the O'Hara bank account in Brooklyn,
New York caused by the check requests made by Iacobucci and Schultz
on March 8, 1989 and May 1, 1989) corruptly, in furtherance of the
authorization of payment and payment of "incidental fees" to O'Hara.
As previously discussed, the defendants both authorized the
payment of and caused the "incidental fees" to be paid to O'Hara
knowing, based upon his representations to them, that he would offer,
pay, promise or give ("take care of") a portion of the incidental
fees to foreign officials of Telecom to obtain or retain business for
15 Harris. Specifically, O'Hara advised Iacobucci of this scheme at
16 their January 13, 1989 meeting in New York and he advised Schultz of
17 his intent during their March 8, 1989 telephone conversation.
18 The defendants acted "knowingly" within the meaning of the
19 statute because, based on O'Hara's representations to them, they were
20 aware or had a firm belief that O'Hara had offered or promised to pay
21 or had given money to officials of Telecom, or that it was
22
substantially certain that he would do so. Alternatively, the
23 defendants acted knowingly as they were aware that there was a high
24 probability that O'Hara had offered or promised to payor had given
25 money to such foreign officials. Moreover, given the unequivocal
26 representation by O'Hara to Iacobucci and Schultz that he intended
'ORM 080,183
MAR.83
GOVT MEMO IN ANTICIPATION OF
DEFENDANTS' RULE 29 MOTION - 15 -
1
to use the incidental fees to pay foreign officials of Telecom, the
2 I defendants clearly acted "corruptly."
IV. Count Five
The Government's evidence discussed in II. B. above
concerning the conspiracy to violate the accounting provisions of the
3
4
5
6
FCPA demonstrates that there is sufficient evidence to sustain a
7 conviction of the substantive FCPA accounting offense alleged in
8 Count Five. The parties have stipulated to the status of Harris as
9 an issuer. The conduct of Iacobucci and Schultz with respect to the
10 check requests establishes that they aided and abetted the accounting
11 violation by causing those books and records to be false by omitting
12 an entry that a portion of the payment to Polo was for foreign
13 officials.
14 V. Conclusion
15 For the foregoing reasons, the Government believes that it
16 has demonstrated that the evidence presented in its case-in-chief is
17 sufficient to sustain a conviction of each defendant for each count.
18 Accordingly, the Court should deny any motion for a judgment of
19 acquittal made by the defendants pursuant to Rule 29(a).
20
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25
26
aRM OBO-183
MAR.83
DATED: 3 r 1614' I
By:
GOVT MEMO IN ANTICIPATION OF
WILLIAM T. McGIVERN, JR.
United States Attorney
So ltw. MPl} J!rL.
Scot t W. I M a ~ K a y r
Peter B. Loewenberg
Trial Attorneys
U.S. Department of Justice
DEFENDANTS' RULE 29 MOTION - 16 -
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FORM OBD-183
MAR. 83
CERTIFICATE OF SERVICE
I hereby certify that on March ~ , 1991, I served the
foregoing Government Memorandum in Anticipation of Defendants' Rule
29 Motion by transmitting said document to counsel for the defendants
by messenger at the following addresses:
Michael L. Fayad, Esq.
McKenna & Cuneo
One Market Plaza
Steuart Street Tower, 27th
San Francisco, California
Jeffrey R. Chanin, Esq.
Keker & Brockett
710 Sansome Street
San Francisco, California
Floor
94105
94111
Charles R. Breyer, Esq.
Coblentz, Cahen, McCabe & Breyer
222 Kearny Street, 7th Floor
San Francisco, California 94111
Scott . MacKa
Trial Attorney
,
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IN THE UNITED STATES
NORTHERN DISTRICT
BEFORE: THE HONORABLE CHARLES A.
UNITED STATES OF AMERICA,
PLAINTIFF,
VS
HARRIS CORPORATION, JOHN,
IACOBUCCI AND RONALD SCHULTZ
)
)
) CR 90 0456
)
)
)
)
)
8-1389
) TUESDAY, MARCH 19, 1991
)
DEFENDANTS. )
)
-------------------------------)
DAILY TRANSCRIPT OF PROCEEDINGS
BEFORE THE HONORABLE CHARLES A. LEGGE, JUDGE
ORIGINAL
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
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FOR THE PLAINTIFF:
FOR THE DEFENDANT
IACOBUCCI:
FOR THE DEFENDANT
HARRIS CORPORATION:
FOR THE DEFENDANT
SCHULTZ:
COURT REPORTERS:
PETER B. LOEWENBERG
AND
SCOTT W. MAC KAY
TRIAL ATTORNEYS
7-1316
UNITED STATES DEPARTMENT OF JUSTICE
CRIMINAL DIVISION
1400 NEW YORK AVENUE, NW RM. 3114
P.O. BOS 28188, CENTRAL STATION
WASHINGTON, DC 20038
KEKER & BROCKETT
BY: JEFFREY CHANIN, ESQ.
AND JULIA BOAZ COOPER, ESQ.
710 SANSOME STREET
SAN FRANCISCO, CALIFORNIA 94111
WILSON, SONSINI, GOODRICH & ROSATI
BY: ROBERT P. FELDMAN, ESQ.
AND JANET M. CRAYCROFT, ESQ.
TWO PALO ALTO SQUARE
PALO ALTO, CALIFORNIA 94305
AND
Me KENNA & CUNEO
MICHAEL L. FAYAD
1575 EYE STREET, N. W.
WASHINGTON, D. C. 2005
COB LANTZ , CAHEN, MC CABE & BREYER
BY: CHARLES BREYER, ESQ.
AND
JEFFREY S. COGEN, ESQ.
222 KEARNY STREET
SAN FRANCISCO, CALIFORNIA 94108
ROSITA FLORES
CARL PLI NE
OFFICIAL COURT REPORTERS
450 GOLDEN GATE AVENUE
BOX 36052
SAN FRANCISCO, CA 94102
ROSITA FLORES, OFFICIAL COUAT REPORTER, .USDC
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RULE 29 MOTIONS
TUESDAY, MARCH 19, 1991
8-1317
8:00 A.M., O'CLOCK
JURY.)
(FOLLOWING PROCEEDINGS OUTSIDE THE PRESENCE OF THE
MR. BREYER: GOOD MORNING, YOUR HONOR.
LET ME GET THE OTHERS.
(PAUSE IN PROCEEDINGS WHILE WAITING FOR COUNSEL TO
RETURN TO COURTROOM.)
THE COURT: ALL RIGHT.
IS EVERYONE HERE THIS MORNING?
MR. MAC KAY: FOR THE GOVERNMENT, YES, YOUR HONOR.
MR. FELDMAN: AND FOR THE DEFENSE.
THE COURT: ALL RIGHT.
ALL RIGHT. THE GOVERNMENT HAS NOW RESTED, AND THE
DEFENDANTS HAVE IN WRITING MADE CERTAIN RULE 29 MOTIONS. I
DON'T KNOW WHETHER THOSE ARE GOING TO BE SUPPLEMENTED BY ORAL
MOTIONS THIS MORNING, BUT WHAT I RECEIVED LATE YESTERDAY WAS THE
FOLLOWING, AND IN NO PARTICULAR ORDER:
THE GOVERNMENT'S MEMORANDUM IN ANTICIPATION OF
DEFENDANTS' MOTION FOR A JUDGMENT OF ACQUITTAL; DEFENDANT
SCHULTZ' MOTION FOR JUDGMENT OF ACQUITTAL; RULE 29 MOTION, RE
OTHER GOVERNMENT AGENCIES; MOTION FOR JUDGMENT OF ACQUITTAL AND
INCORPORATED MEMORANDUM; AND MOTION FOR JUDGMENT OF ACQUITTAL.
I'VE SPENT SEVERAL HOURS GOING OVER THESE MOTIONS,
INCLUDING THE FIRST GOVERNMENT'S OPPOSITION.
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1318
1 AND BEFORE I TURN IT OVER TO YOU, I THINK YOU OUGHT TO
2 KNOW WHERE I STAND ON SOME OF THESE THINGS.
3 WE'RE OF COURSE DEALING WITH THE STANDARD OF RULE 29
4 WHICH REQUIRES ME TO MAKE ANY REASONABLE INFERENCE FROM THE
5 EVIDENCE IN FAVOR OF THE GOVERNMENT. AND WHAT I MUST DETERMINE
6 IS WHETHER THERE IS SUFFICIENT EVIDENCE, USING THOSE INFERENCES,
7 BY WHICH A JURY COULD REASONABLY FIND GUILT BEYOND A REASONABLE
8 DOUBT.
9 AND I MUST SAY, IN LOOKING AT THE. WHOLE THING, I THINK
10 IT'S -- I THINK IT'S A CLOSE CALL.
11 THE DEFENDANTS HAVE ATTACKED VARIOUS ELEMENTS OF THE
12 COUNTS. I SUPPOSE WITHIN -- BY ATTACKING THE SUFFICIENCY OF THE
13 EVIDENCE REGARDING COUNT ONE, THEY -- THE DEFENDANTS MAY ALSO BE
14 INDIRECTLY ATTACKING COUNTS TWO, THREE, FOUR, AND FIVE, BECAUSE
15 OF COURSE THE ABSENCE OF ANY CONSPIRACY OR AGREEMENT IN COUNT
16 ONE WOULD CERTAINLY UNDERCUT THE CONCEPTS OF CORRUPT, KNOWING,
17 WILLFUL, CONTAINED IN COUNTS TWO, THREE, FOUR, AND FIVE.
18 I'VE TAKEN A BIT MORE MACRO APPROACH WITH THIS, AND
19 LOOKED -- TRIED TO LOOK TO SEE REALLY WHAT THE CASE IS ABOUT,
20 AND WHETHER THERE IS SUFFICIENT EVIDENCE FOR A REASONABLE JURY
21 TO RULE -- FIND THE DEFENDANTS GUILTY BEYOND A REASONABLE DOUBT.
22 I THINK IT'S -- I THINK IT'S A THIN CASE. A THIN
23 CRIMINAL CASE. I'VE ALREADY DETERMINED THAT THE GOVERNMENT HAS
24 NOT SHOWN A CONSPIRACY BETWEEN O'HARA AND LOPEZ BY A MEASURE OF
25 THE PREPONDERANCE OF THE EVIDENCE. WHILE THAT DOES NOT, I
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS 8-1319
SUPPOSE, AS A MATTER OF LAW COMPEL A CONCLUSION THAT NO
REASONABLE JURY COULD FIND IT BEYOND A REASONABLE DOUBT, IT
CERTAINLY GOES IN THAT DIRECTION.
WHAT THERE HAS TO BE, AS I SEE IT, IS A CONSPIRACY
BETWEEN O'HARA AND HARRIS CORPORATION. AND THE PEOPLE AT HARRIS
CORPORATION THAT O'HARA DEALT WITH ARE ESSENTIALLY MR. IACOBUCCI
AND MR. SCHULTZ.
THERE'S GOT TO BE AN AGREEMENT BY SOMEBODY ON THE
HARRIS SIDE OF THE TABLE TO DO THE THINGS THAT ARE ACCUSED. AND
BY THE THINGS THAT ARE ACCUSED, IT WOULD MEAN AN INTENT OR AN
ACT -- WITH AN ACT TO PAY MONEY TO O'HARA, TO ATTEMPT TO USE
INFLUENCE -- OR USE THE MONEY FOR INFLUENCE ON LOPEZ TO ASSIST
IN THE OBTAINING OF CONTRACTS FROM TELECOM.
NOW ••• I THINK IT'S VERY THIN.
O'HARA IS NOT A BUSINESSMAN IN THE TRADITIONAL SENSE
OF THE TERM. THAT IS, HE'S NOT IN THE BUSINESS OF OVER A PERIOD
OF TIME CONSISTENTLY SUPPLYING GOODS, SUPPLYING SERVICES. HE'S
ONE OF THESE PEOPLE WHO ARE ON THE PERIPHERY OF THE BUSINESS
WORLD, WHO TRY TO POSITION THEMSELVES INTO DEALS. THAT IS, THEY
SEE A POTENTIALITY FOR A DEAL AND SOME ROLE FOR THEM IN A DEAL,
AND THEY INSERT THEMSELVES INTO THE DEAL, AND WORK BOTH ENDS TO
MAKE A DEAL.
THERE'S NOTHING ILLEGAL ABOUT THAT. BUT WHAT IT DOES
IS ADD SOME CONTEXT AS TO WHY THE WORDS, PARTICULARLY O'HARA'S
WORDS, KEEP CHANGING AS THE DEAL GOES ALONG, AND AS HIS
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS 8-1320
TESTIMONY GOES ALONG. BECAUSE WHAT HE WANTS IS ANY DEAL,
ANYTHING, WHERE HE'S GOING TO BE IN THE MIDDLE OF IT AND GET
SOME COMPENSATION. AND HE WANTS A DEAL OF ANY KIND TO GO
FORWARD ON ANY TERMS.
HE ALSO ADMITS LYING TO IACOBUCCI, TO SCHULTZ, TO
HARRIS CORPORATION.
SO TO SAY THAT HIS IS THE TESTIMONY WHERE A JURY CAN
FIND BEYOND A REASONABLE DOUBT THAT THE HARRIS COMPANY PEOPLE
AGREED TO SOMETHING ••• IS VERY DIFFICULT.
SO WE THEN COME TO THE OTHER COAST, AND WE SEE WANG.
A LOT OF HIS TESTIMONY IS SOMEWHAT ILLOGICAL, IN THE SENSE THAT:
WOULD A COMPANY WHO IS ABOUT TO EMBARK ON AN ENTERPRISE THAT
COULD BE CRIMINAL USE A MAN WHO THEY'VE JUST FIRED TO DOCUMENT
THE DEAL?
WITH RESPECT TO WANG, WHAT I GET FROM HIM, EVEN TAKING
HIS PERCEPTION OF IT, IS THAT HE SEES THE EVENTS AS HE BELIEVES
THEY ARE OCCURRING AT THE TIME THE EVENTS STARTED. HE DOESN'T
SEE IT THROUGH TO FRUITION; HE DOESN'T SEE WHAT OCCURRED AT THE
END; AND HE'S, OF COURSE, ONLY TELLING THE GOVERNMENT WHAT HE
SAW AT THE BEGINNING.
WE ALSO, OF COURSE, HAVE THE FACT THAT NO MONEY EVER
GOT PAID TO COLOMBIA. AND NO CONTRACT WAS EVER ENTERED INTO BY
HARRIS WITH ANYBODY IN COLOMBIA.
THAT'S A PRETTY THIN PACKAGE.
NOW, OF COURSE ••• SOME OF WHAT I HAVE SAID IS AN
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1321
1 EVALUATION. AND ON A RULE 29 STANDARD I'M NOT SUPPOSED TO
2 EVALUATE. BUT WHAT I STILL AM CHOKING ON IS WHETHER THERE IS
3 SUFFICIENT EVIDENCE THAT HARRIS AND •••• WELL, HARRIS THROUGH ITS
4 OFFICERS AND EMPLOYEES, IACOBUCCI AND SCHULTZ, EVER REALLY
5 AGREED TO ANYTHING THAT O'HARA PROPOSED TO DO.
6 THERE'S NO DOUBT IN MY MIND THAT O'HARA WOULD HAVE
7 DONE WHATEVER HE COULD HAVE DONE. IT'S THE NATURE OF HIS
8 BUSINESS. CERTAINLY INDICATED BY WHAT HE SHOWED HERE.
9 SO WHERE IS THE AGREEMENT? WHERE IS THE AGREEMENT
10 THAT MAKES A CONSPIRACY OUT OF COUNT ONE? AND IF THERE WAS NO
11 AGREEMENT, WHERE IS THE CORRUPT KNOWLEDGE IN COUNTS TWO, THREE,
12 AND FOUR; AND WHERE IS THE WILLFULNESS AND KNOWINGNESS ON COUNT
13 FIVE?
14 I MUST SAY WITH RESPECT TO COUNT FIVE I HAVEN'T
15 COMPLETED MY RESEARCH YET. I FIND THAT -- THOSE SECTIONS
16 DEALING WITH THE COUNT FIVE VIOLATION KIND OF TORTUOUS TO WALK
17 THROUGH, AND I GET HUNG UP ON THEM EVERY TIME I TRY TO READ
18 THEM.
19 I SUPPOSE THAT ••• TAKING IT AT ITS MAXIMUM, THE THINGS
20 THAT MIGHT INDICATE AN AGREEMENT ARE -- ABOVE AND BEYOND WHAT
21 O'HARA HAD TO SAY, WHICH I DON'T THINK IS ENOUGH TO ESTABLISH AN
22 AGREEMENT. I THINK MOST OF O'HARA'S TESTIMONY, EVEN TAKING --
23 READING THE GOVERNMENT'S BRIEF AND TAKING IT AT FULL FACE VALUE,
24 THE MOST THAT COULD BE -- THAT IT SHOWS THERE IS O'HARA PUT A
25 PROPOSITION ON THE TABLE; MR. IACOBUCCI DIDN'T SLAM DOWN HIS
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1322
1 BRIEFCASE, OR HIS BOOKS, AND WALK OUT THE DOOR; HE KEPT TALKING.
2 SAID HE WOULD THINK ABOUT IT.
3 I THINK MOST OF WHAT O'HARA TESTIFIES TO -- IF NOT ALL
4 OF WHAT O'HARA TESTIFIES TO -- IS THAT HE, O'HARA, THOUGHT THERE
5 WAS A DEAL.
6 A SHAKING OF THE HANDS ••• I DON'T ADD ANY SIGNIFICANCE
7 TO THAT AT ALL. ANY TIME ANY CIVILIZED PEOPLE ARE AT A BUSINESS
8 MEETING, THEY GENERALLY SHAKE HANDS AND SAY GOODBY TO ONE
9 ANOTHER AT THE END OF THE MEETING.
10
WANTING TO DO BUSINESS IN COLOMBIA. WELL, I DON'T
11 THINK THERE'S ANYTHING CONSPIRATORIAL ABOUT THAT. I'M SURE IF
12 MR. IACOBUCCI COULD GET SOME BUSINESS IN COLOMBIA ON A BONA FIDE
13 BASIS, HE WOULD LOVE TO GET THE BUSINESS. THAT'S WHAT HE'S IN
14 BUSINESS FOR.
15 SO I SUPPOSE WHAT CONCERNS ME, WHAT MAY 'ESTABLISH
16 ENOUGH EVIDENCE FOR A JURY TO FIND AN AGREEMENT, ARE THREE
17 THINGS.
18 ONE, THE PAYMENTS. IF THERE IS NO AGREEMENT, WHY THE
19 PAYMENTS? I SUPPOSE IT COULD BE ARGUED THAT IT WAS TO KEEP
20 O'HARA WORKING ON SOME KIND OF INTRODUCTION. MAYBE TO PAY HIM
21 FOR HIS ATTEMPTS TO GET BUSINESS. MAYBE TO HOPE SOMEHOW THAT
22 O'HARA'S CONTACTS WITH LOPEZ AND OTHERS MIGHT GENERATE SOME
23 BUSINESS SOMEWHERE. OR MAYBE TO PAY FOR THE ARRANGEMENTS -- OR
24 PAY HIM SOME COMPENSATION FOR THE ARRANGEMENTS THAT WERE FINALLY
25 AGREED TO BETWEEN O'HARA AND HARRIS CORPORATION.
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RULE 29 MOTIONS 8-1323
AND, FRANKLY, I'M FUZZY ABOUT THIS MAY PAYMENT OF
QUITE WHAT ••• THAT WAS TO BE FOR. SO THAT'S ONE THING THAT •••
THERE'S AT LEAST SOME CONCRETE EVIDENCE OF SOMETHING; AND, THAT
IS, AN ACT, TO WIT, TRANSFER OF MONEY TO O'HARA.
ANOTHER ELEMENT THAT -- ANOTHER ELEMENT THAT MIGHT
ESTABLISH AN AGREEMENT IS THE CONVERSATIONS BETWEEN MR.
IACOBUCCI AND MR. WANG. THOSE ARE REFERRED TO AT THE BOTTOM OF
PAGE 6 AND THE TOP OF PAGE 7 OF THE GOVERNMENT'S MEMORANDUM.
AND THE THIRD ELEMENT ARE MR. SCHULTZ' CONFERENCES
WITH WANG. AND OF COURSE HIS -- THE SO-CALLED BRIBE NOTE, ALSO
REFERRED TO IN THE GOVERNMENT'S MEMORANDUM.
SO THAT'S ••• WHERE I AM. THERE'S NO DOUBT IN MY MIND
THAT IF I WERE THE TRIER OF FACT I WOULD CONCLUDE AT THIS POINT
IN THE EVIDENCE THAT THE GOVERNMENT HAS NOT BEEN ABLE TO
ESTABLISH ITS CASE BEYOND A REASONABLE DOUBT.
I DON'T FAULT THE GOVERNMENT IN ANY WAY. WHEN
SOMEBODY LIKE WANG COMES TO THEM AND SAYS: "I'VE GOT SOME HOT
INFORMATION," AND THEN THEY MEET O'HARA, AND O'HARA HANDS IN HIS
VERSION, I SUPPOSE IT'S PERFECTLY REASONABLE FOR THE GOVERNMENT
TO PROCEED.
BUT WERE I THE TRIER OF FACT I WOULD FIND FOR
ACQUITTAL. BUT, AS YOU ALL KNOW, THAT'S NOT MY ROLE. AND MY
ROLE IS AGAIN, RESTATING THE OBVIOUS, IS TO SEE WHETHER
THERE'S ENOUGH EVIDENCE HERE FOR ANY REASONABLE JURY TO FIND IN
FAVOR OF THE GOVERNMENT. AND, AS I SAID, I THINK IT'S CLOSE.
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1324
1 I CAN SEE WHY O'HARA PLEADED GUILTY. HE WANTED TO DO
2 WHATEVER HE COULD DO. I'M CONVINCED FROM LISTENING TO HIM, IF
3 HE HAD AN OPPORTUNITY TO BRIBE SOMEBODY TO GET A PIECE OF
4 BUSINESS, HE WOULD DO IT. AND HAVING STARTED DOWN THAT TRAIL •••
5 HE CERTAINLY HAD A GUILTY CONSCIENCE, GUILTY MIND; AND I CAN SEE
6 WHY HE PLEADED GUILTY.
7 I MUST SAY THAT I DON'T RECALL, IN ANY OF THE CASES
8 I'VE HANDLED IN SIX -- DURING SIX PLUS YEARS HERE ON THE BENCH,
9 THAT I HAVE EVER GRANTED A COMPLETE RULE 29 MOTION. I'VE CUT
10 AWAY CAUSES OF ACTION WHERE I FELT THAT THERE IS NOT ••• EVIDENCE
11 OR LAW TO SUPPORT IT; BUT I DON'T BELIEVE I'VE EVER GRANTED A
12 FULL RULE 29. BUT I MUST SAY IN THIS CASE I'M TEMPTED.
13 SO WHERE DOES THAT LEAVE US?
14 WHAT I WOULD LIKE YOU TO FOCUS ON IS ••• WHAT'S THE
15 EVIDENCE OF THE AGREEMENT? AND I DON'T THINK WHAT O'HARA
16 TESTIFIED TO ABOUT HIS CONVERSATIONS WITH IACOBUCCI, STANDING
17 ALONE, IS SUFFICIENT TO GET TO A JURY.
18 I THINK WE NEED -- OR THE GOVERNMENT NEEDS THE LATER
19 EVIDENCE OF IACOBUCCI'S CONVERSATIONS WITH WANG; SCHULTZ'
20 CONVERSATIONS WITH WANG, TOGETHER WITH THE BRIBE NOTE; AND THE
21 AGREEMENT.
22 SO I'D LIKE TO HEAR YOUR THOUGHTS ON THOSE SUBJECTS.
23 AND I'M NOT PRECLUDING -- I'M TAKING A MACRO APPROACH TO THIS
24 THING, AS YOU CAN SEE. AND I'M NOT PRECLUDING YOU FROM ARGUING
{
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25 ANYTHING ELSE; AND INDEED SOME OF YOUR MOTIONS HAVE BEEN MORE
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1325
1 MICRO THAN MACRO. AND I UNDOUBTEDLY WILL HAVE -- WELL, I
2 SHOULDN'T SAY "UNDOUBTEDLY"; I MAY WELL HAVE TO FOCUS ON THOSE
3 SEPARATELY.
4 SO ••• DEFENDANTS, IT'S YOUR MOTION. BUT ••• DON'T JUST
5 GIVE ME PLATITUDES; AND DON'T JUST SAY: JUDGE, I CERTAINLY
6 AGREE WITH YOU.
7 I WANT TO HEAR WHAT YOU HAVE TO SAY ABOUT THESE
8 SPECIFIC THINGS THAT I RAISED. AND WHY YOU FEEL THE EVIDENCE IS
9 NOT SUFFICIENT TO SHOW AGREEMENT.
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MR. FELDMAN: WOULD YOU LIKE US TO BEGIN?
THE COURT: YES.
MR. FELDMAN: AM I ALLOWED TO START, JUDGE, BY SAYING:
13 "I AGREE WITH YOU"?
14 THE COURT: I WILL ASSUME THAT THE DEFENDANTS AGREE
15 ,WITH ME AT THE MOMENT.
16 MR. FELDMAN: LET ME SEE IF I CAN ADDRESS SOME OF THE
17 MATTERS THAT YOU WERE TROUBLED BY, RATHER THAN TELL YOU WHY I
18 AGREE WITH YOU.
19 AS I UNDERSTAND THE COURT'S CONCERNS, THE FIRST ISSUE
20 WAS ONE OF WHETHER THE PAYMENTS REFLECTED AN AGREEMENT TO DO
21 SOMETHING CORRUPT; THAT IS TO SAY, THE -- THE AGREEMENT ALLEGED
22 IN THE INDICTMENT.
23 AND ••• I BELIEVE THAT THERE'S TESTIMONY IN THE RECORD
24 FROM MR. O'HARA THAT THE PAYMENT FOR THE EXPENSES WAS BASICALLY
25 IN CONNECTION WITH A TRIP; THAT IS, THE TRIP IN MARCH.
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RULE 29 MOTIONS 8-1326
AND MR. STEVENSON TESTIFIED YESTERDAY THAT THE TRIP
WAS TO -- UNDERTAKEN FOR THE PURPOSE OF CHECKING OUT THE
OPPORTUNITY. AND MR. O'HARA TESTIFIED, IN EFFECT, THAT THAT'S
WHY THEY WENT DOWN THERE, TO SEE WHETHER THE -- IN HIS WORDS:
TO SEE WHETHER THEY COULD BE EFFECTIVE, AND TO SEE WHETHER THEY
WISHED TO BID, AND FIND OUT WHAT THEY WANTED TO DO DOWN THERE,
TO -- TO SEE IF THEY WANTED TO DO BUSINESS, AND TO MEET PEOPLE.
THE COURT: WELL, THEN WHY THE MAY PAYMENT?
MR. FELDMAN: WELL ••• THE MAY PAYMENT, YOUR HONOR --
WITHOUT ADDRESSING THE MOTION WITH RESPECT TO THE OTHER TELECOM
COMPANIES, WITHOUT GETTING INTO THAT NOW -- IN OUR VIEW THE MAY
PAYMENT IS THE CLEAREST EVIDENCE OF WHY THERE IS NO
CONSPIRATORIAL AGREEMENT. THE MAY PAyMENT •••• WITHDRAW.
I THINK THE EVIDENCE IS QUITE CLEAR NOW, PARTICULARLY
AFTER MR. STEVENSON'S TESTIMONY, BUT EVEN INCLUDING MR. O'HARA'S
TESTIMONY, THAT THERE WAS NO CONTRACT AT TELECOM ON WHICH THIS
COMPANY WISHED TO BID OR EVEN PURSUE. THERE SIMPLY WAS NOTHING.
THEY WENT DOWN THERE, AND THERE WAS NO SUITABLE OPPORTUNITY.
AND THE TESTIMONY IS NOW ABSOLUTELY CLEAR, FROM BOTH
O'HARA AND STEVENSON, THAT NO LATER THAN APRIL 7TH, WHICH IS
WHEN O'HARA VISITED DTS FOR THE SECOND TIME, THAT, ACCORDING TO
STEVENSON AND O'HARA, THOMPSON SAID: YOU WILL NOW SEARCH FOR A
DISTRIBUTOR FOR US.
THAT TOOK PLACE ON APRIL 7TH. AND STEVENSON TESTIFIED
YESTERDAY THAT O'HARA SUBMITTED A BILL. O'HARA TESTIFIED THAT
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RULE 29 MOTIONS 8-1327
HE SUBMITTED A BILL. I DON'T REMEMBER THE EXHIBIT NUMBER, BUT
YOU MAY RECALL IT REFERRED TO A RAFAEL CAMPOS, WHO MR. O'HARA --
THE COURT: I DON'T.
MR. FELDMAN: IT WAS A -- IT WAS THE FIRST IN THE
SERIES OF BILLS IN THE POST-TRIP PERIOD.
I ASKED MR. O'HARA IF HE REMEMBERED THAT THE PERSON
WAS DEAD.
THAT MAY RING A BELL. THERE WAS -- THERE'S AN --
THE COURT: WELL, I REMEMBER THE TOPIC. YOU ASK ME IF
I REMEMBER AN EXHIBIT, AND I FRANKLY DON'T HAVE THE EXHIBIT IN
MIND.
MR. FELDMAN: I DON'T HAVE THE NUMBER IN MIND.
BUT THERE WAS AN EXHIBIT WHICH MR. O'HARA SUBMITTED.
IT WAS THE FIRST IN THAT SERIES. IT WAS, AS HE PUT IT, JUST
ANOTHER ATTEMPT TO GET MONEY.
AND THOMPSON KNOCKED HIM DOWN FROM SOME TWENTY-FIVE
THOUSAND TO SOME THIRTEEN THOUSAND.
AND THERE WAS AN ENTRY ON THERE FOR INCIDENTAL FEES.
AND ••• THE FACT THAT THAT INVOICE WAS PAID AFTER ANY INTEREST IN
TELECOM, OR PURSUING TELECOM THROUGH O'HARA HAD TOTALLY
DISAPPEARED, BY O'HARA'S TESTIMONY AND BY STEVENSON'S TESTIMONY,
AND BY THE FACT OF WHAT THE EVENTUAL AGREEMENT WAS, IN OUR VIEW
SHOWS THAT THERE WAS NEVER AN AGREEMENT TO PAY CORRUPT
INCIDENTAL FEES.
THE COURT: WELL, THE GOVERNMENT ARGUES ••• I THINK,
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT1COURT
RULE 29 MOTIONS 8-1328
1 THAT THE MAY PAYMENT WAS A PART OF THE EARLIER SCHEME.
2 MR. FELDMAN: BUT -- SURE. I GUESS THAT'S WHAT THEY
3 ARGUE. BUT ••• HOW COULD THAT BE? THERE WAS NO -- I MEAN, THE
4 GOVERNMENT'S--
5 THE COURT: WELL, WHAT DO YOU SAY IT WAS? WHAT DO YOU
6 SAY IT WAS?
7 YOU SAY IT WAS TO ENABLE O'HARA TO PURSUE THE
8 AGREEMENTS TO SEEK A DISTRIBUTOR; RIGHT?
9 MR. FELDMAN: NO.
THE COURT: IS THAT RIGHT? 10
11 MR. FELDMAN: NO, NOT -- ACTUALLY, THAT'S -- THAT'S
12 NOT QUITE RIGHT.
THE COURT: NOT RIGHT. 13
14 MR. FELDMAN: WHAT IT WAS -- I THINK MR. O'HARA
15 TESTIFIED -- IS A RIPOFF.
16 I DON'T MEAN TO BE ••• TOO COLLOQUIAL ABOUT THIS,
17 BUT --
18 THE COURT: WELL, WHAT DID -- WHAT DID HARRIS THINK IT
19 WAS PAYING?
20 MR. FELDMAN: I -- HARRIS DIDN'T KNOW WHAT IT WAS
21 PAYING, YOUR HONOR.
22 I MEAN, THE EVIDENCE IS THAT O'HARA SENT IN A BILL FOR
23 TWENTY-FIVE THOUSAND DOLLARS •••
THE COURT: UH-HUH. 24
25 MR. FELDMAN: •••• AND FRANK THOMPSON KNOCKED IT DOWN
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COURT
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RULE 29 MOTIONS
TO THIRTEEN THOUSAND DOLLARS.
8-1329
THAT INCIDENTAL FEE ENTRY IS NOT THE ONLY FALSE ENTRY
ON THERE. THERE'S AN ENTRY THERE FOR A MONTHLY REP FEE OF TWO
THOUSAND DOLLARS. THAT WAS NONSENSE. THERE ARE OTHER ENTRIES
THAT JUST DON'T COME TO MY MIND NOW THAT ARE JUST NONSENSE.
THEY HAVE NO NO SEMBLANCE OF REALITY.
AS O'HARA TESTIFIED, HE PUT ALL THAT MONEY IN HIS
POCKET. IT WAS JUST NONSENSE. IT WASN'T -- I MEAN, PERHAPS I'M
NOT ••• HAPPY TO SAY THIS ON BEHALF MY CLIENT, BUT
THE COURT: WELL, WHAT YOU'RE SAYING IS YOU THINK THAT
O'HARA DEFRAUDED HARRIS.
MR. FELDMAN: WELL, IT'S ABSOLUTELY CLEAR. IT'S--
IT'S ABSOLUTELY CLEAR.
I MEAN, WE'RE SEARCHING PERHAPS IN THE LIGHT OF DAY
AND HINDSIGHT FOR A -- YOU'RE ASKING ME: WHY DID THEY THINK
THEY ARE PAYING?
WELL, THE TRUTH OF THE MATTER IS O'HARA SUBMITTED
BILLS, WE KNOCKED THEM DOWN, AND GOT THEM DOWN AS FAR AS WE
COULD, AND WEREN'T ABLE TO GET ANY SATISFACTORY ANSWER.
BUT THAT, I DON'T THINK, WITH ALL DUE RESPECT, IS
ACTUALLY THE INQUIRY. BECAUSE -- I REALIZE THIS IS NOT A JURY
ARGUMENT, AND I WON'T ARGUE IT THAT WAY -- BUT WE WENT DOWN
THERE TO SEE IF THERE WAS AN OPPORTUNITY, FOUND OUT THAT THERE
WASN'T.
AND IT CAN HARDLY BE SAID THAT WE WOULD HAVE -- AND
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS 8-1330
THIS IS THE ONLY THING THAT I CAN UNDERSTAND FROM THE
GOVERNMENT'S POSITION -- THAT WE WOULD HAVE REIMBURSED HIM FOR A
PAYMENT ON A CONTRACT THAT WAS NONEXISTENT THAT WE DID NOT BID
ON.
IT'S -- IT JUST DOSEN'T -- I MEAN, I DON'T THINK IT'S
ANY MORE COMPLICATED THAN THAT. WE WENT DOWN TO SEE IF THERE
WAS AN OPPORTUNITY.
WE WENT TO THE PUBLIC READING ROOM, SAW --
THE COURT: YES, I KNOW.
MR. FELDMAN: ACCORDING TO THE UNDISPUTED
TESTIMONY, THAT THERE WAS NOTHING TO BID ON.
THE COURT: ALL RIGHT.
MR. FELDMAN: SO YOU'RE ASKING ME TO MAKE SENSE OF THE
MAY 1ST PAYMENT.
AND WHAT I CAN TELL YOU WITH CERTAINTY IS THAT IT'S
IMPOSSIBLE -- OF ALL THE THINGS THAT WE HAVE IN THIS CASE, IT
HAS BEEN OUR POSITION FROM THE VERY BEGINNING THAT THE MOST
ILLOGICAL, MOST UNSUPPORTABLE POSITION, CLAIM, OR ALLEGATION IS
THAT THE MAY 1ST PAYMENT WAS INTENDED TO BE A CORRUPT PAYMENT TO
TELECOM.
BECAUSE THERE WAS NO INTEREST WHATSOEVER IN TELECOM
BUSINESS AT THAT POINT. IT HAPPENS -- ALTHOUGH I DO THINK
IT'S -- AND I THINK IT'S BUT I DON'T THINK IT'S
NECESSARY -- THAT THE FINAL FORMAL AGREEMENT HAD BEEN SIGNED
BEFORE THAT PAYMENT WAS MADE. THE FINAL FORMAL AGREEMENT WHICH
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1331
1 HAD NOTHING WHATSOEVER TO DO WITH OBTAINING BUSINESS AT TELECOM.
2 THE COURT: WHEN WAS THAT SIGNED?
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MR. FELDMAN: APRIL 25TH.
AND THE EVIDENCE IS AT LEAST CONSISTENT WITH A VIEW
THAT WELL, IT'S NOT CONSISTENT; IT'S CLEAR -- THAT WHEN THEY
CAME BACK FROM TELECOM THERE WERE DRAFTS OF THAT CONTRACT WHICH
PRECEDED, OBVIOUSLY, APRIL 25TH.
MR. O'HARA SAID THEY SENT DRAFTS BACK AND FORTH. AND
9 YOU'VE GOT THE CHART THAT SHOWS THE COMPLETE DIFFERENCE IN THE
10 FINAL AGREEMENT --
11 THE COURT: YES.
12 MR. FELDMAN: SO -- AND THAT AGREEMENT, YOUR HONOR,
13 PRECEDED BY FIVE DAYS THE PAYMENT ON MAY 1ST. IT ALSO REFERS TO
14 THE PAYMENT OF THIRTEEN THOUSAND THREE HUNDRED AND FORTY-FIVE
15 DOLLARS.
16 SO I THINK THAT ••• THE CLEAREST EVIDENCE THAT THERE
17 WAS NOT A CONSPIRATORIAL AGREEMENT IS ACTUALLY THAT MAY 1ST
18 PAYMENT.
19 IF I'M NOT EXPRESSING IT WELL, I WOULD LIKE TO TRY
20 AGAIN. BECAUSE IF THERE WAS NO CONTRACT OF INTEREST, AND IT WAS
21 CLEAR FROM STEVENSON AND O'HARA THAT WE WERE NO LONGER
22 INTERESTED IN PURSUING TELECOM, AND CERTAINLY THAT THERE WAS NO
23 SPECIFIC TELECOM CONTRACT, THEN THERE COULD NOT HAVE BEEN A
24 PURPOSE OF PAYING A TELECOM OFFICIAL FOR AN ACT OR DECISION.
25 AND THAT'S WHAT'S REQUIRED, PAYMENT FOR --
CARL R. PLINE OFFICIAL COURT REPORTER
U. s. DISTRTl:T l:nIlRT
RULE 29 MOTIONS 8-1332
1 THE COURT: YES.
2 MR. FELDMAN: CORRUPT PAYMENT FOR --
3 THE COURT: I AGREE.
4 MR. FELDMAN: -- AN ACT OR A DECISION.
5 THE COURT: I KNOW.
6 MR. FELDMAN: AND IT IS IMPOSSIBLE AS A LOGICAL
7 MATTER, NEVER MIND AS A MATTER OF PROOF BEYOND A REASONABLE
8 DOUBT, TO SAY THAT THERE WAS A PURPOSE TO OBTAIN AN ACT OR
9 DECISION OF TELECOM WHEN WE WERE NOT INTERESTED IN ANY CONTRACTS
10 AND WERE SEEKING DISTRIBUTORS.
11 SO I -- I •••• I DON'T SEE THAT.
12 THE COURT: WELL, THAT JUST LEAVES US WITH A GREAT BIG
13 nWHy,n QUESTION MARK.
14 MR. FELDMAN: WELL, JUDGE, I THINK IT ACTUALLY
15 DOESN'T. I THINK THAT THE nWHY" IS -- WELL, SURE IT DOES.
16 EXCEPT THAT I THINK WE'RE NOT AT THIS STAGE •••• I MEAN, THE
17 BURDEN IS NOT ON US TO PROVE WHY.
18 IF WE EXCLUDE THE POSSIBILITY THAT THERE WAS ANY
19 CORRUPT PURPOSE INTENDED, WE DON'T HAVE TO PROVE -- JUST LIKE WE
20 DON'T HAVE TO PROVE WHY PETER WANG WAS FIRED -- WE DON'T HAVE TO
21 PROVE WHY THAT MONEY WAS PAID IF THERE'S NO PROOF AT ALL THAT IT
22 WAS FOR AN ACT OR DECISION OF TELECOM TO GET BUSINESS.
23 THE COURT: WELL, TRUE
(
24 MR. FELDMAN: IN -- IN MY VIEW THAT IS
,
25 THE COURT: TRUE. BUT NOW I HAVE -- I HAVE TO
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTI ONS 8-1333
1 EVALUATE WHETHER INFERENCES CAN ARISE FROM THOSE FROM WHICH A
2 JURY COULD DRAW CONTRARY CONCLUSIONS. THAT'S WHERE ANSWERS TO
3 nWHy
n
QUESTIONS AT LEAST PROVIDE SOME MENTAL REPOSE.
4 MR. FELDMAN: YES. I ACTUALLY THINK THAT •••• YOU
5 KNOW, I CITED THE CELOTEX OPINION TO YOU.
6 THE COURT: YES.
7 MR. FELDMAN: I THINK THAT •••• THAT THIS CASE -- IT'S
8 BEEN MY EXPERIENCE THAT I, AT LEAST, HAVE IN THE PAST, I THINK
9 INCORRECTLY, AT THIS STAGE OF CASES INDULGE TOO MUCH OF A -- I'M
10 NOT SURE THE WORD IS PREFERENCE, BUT I'VE USED THE ABSOLUTE
11 WRONG APPROACH.
12 AT THIS STAGE OF THE CASE THERE'S A MUCH HIGHER BURDEN
13 ON THE GOVERNMENT THAN THERE IS ON A CIVIL PLAINTIFF IN A CASE;
14 THAT IS, THERE'S A MUCH --
15 THE COURT: NO, NO. 1--
16 MR. FELDMAN: OKAY.
17 THE COURT: -- I AGREE.
18 MR. FELDMAN: SO THE FACT
19 THE COURT: IT SEEMS EVIDENT.
20 MR. FELDMAN: -- THE FACT THAT THERE MAY BE A FACT OR
21 A QUESTION -- WHICH I DON'T THINK THERE IS WITH RESPECT TO THE
22 MAY PAYMENT -- DOESN'T MEAN THAT THE CASE GETS TO THE JURY.
23 THE COURT: OKAY.
24 WELL, THE OTHER -- AS I SAID, THE OTHER THINGS FROM
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CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS 8-1334
BEYOND A REASONABLE DOUBT IS MR. IACOBUCCI'S CONVERSATIONS WITH
WANG, AND MR. SCHULTZ' CONVERSATIONS WITH WANG AT THE TIME THIS
SO-CALLED BRIBERY NOTE IS FLOATING AROUND.
MR. FELDMAN: WELL, I THINK THAT -- I UNDERSTAND THE
COURT'S CONCERN WITH RESPECT TO THAT.
THE TESTIMONY NOW IS QUITE CLEAR THAT ••• MR. -- FROM
MR. O'HARA THAT MR. IACOBUCCI SAID: THIS DEAL CAN'T BE DONE
UNTIL LAWYERS GET INVOLVED AND BLESS IT.
AND YOU HAVE BEFORE YOU THE PROOF OF WHAT HARRIS
CORPORATION DID WITH THIS DEAL; THAT IS, IT WENT TO PETER WANG.
HE DRAFTED THIS EXHIBIT A, AND THAT WAS UNACCEPTABLE TO -- IT
WAS A DRAFT. IT TURNED OUT TO BE UNACCEPTABLE TO ALL CONCERNED,
INCLUDING MR. O'HARA. AND CERTAINLY TO HARRIS.
AND THE DEAL THAT WAS EVENTUALLY STRUCK WAS TOTALLY
DIFFERENT THAN EVEN WHAT WANG'S EXHIBIT A, MUCH LESS WHAT IT IS
THAT IACOBUCCI SAYS -- I BEG YOUR PARDON, THAT O'HARA SAYS HE
THOUGHT IN JANUARY.
YOU HAVE CASES BEFORE YOU WHERE THE FACT THAT THERE
ARE NEGOTIATIONS, INCLUDING EXTENSIVE NEGOTIATIONS -- AND I HAVE
REFERENCE PARTICULARLY TO THE MELCHOIR-LOPEZ CASE -- THE FACT
THAT THERE ARE EXTENSIVE NEGOTIATIONS -- WHICH THERE REALLY
WEREN'T HERE BUT THE FACT THAT THERE ARE EXTENSIVE
NEGOTIATIONS IS NOT ONLY NOT PROOF OF AN AGREEMENT, BUT IN MANY
CASES CAN BE CONSTRUED AS PROOF OF A NONAGREEMENT.
AND IT CERTAINLY WAS IN THE MELCHOIR-LOPEZ CASE, WHICH
CARL R. PLINE OFFICIAL COURT REPORTER
U. S. DISTRICT COIIRT
RULE 29 MOTIONS 8-1335
1 IS AT 627 F.2D. IN THAT CASE THE PARTIES INDICATED A
2 WILLINGNESS TO DEAL IN NARCOTICS. IT WASN'T SUBTLE.
3 I MEAN, HERE THERE MAY BE SOME QUESTION ABOUT -- EVEN
4 AT THIS STAGE ABOUT WHAT WAS SAID, OR THOUGHT, OR HOPED, OR
5 WISHED. WHEREAS IN THE MELCHOIR-LOPEZ CASE THERE WAS ABSOLUTELY
6 NO QUESTION THAT THERE WAS AN EXTENSIVE DISCUSSION ABOUT ILLEGAL
7 THAT IS, NARCOTICS.
8 BUT BECAUSE THE PARTIES NEGOTIATED OVER A LONG PERIOD
9 OF TIME AND NEVER AGREED, THE NINTH CIRCUIT RULED THAT THE
10 CRITICAL ELEMENT OF AGREEMENT WAS LACKING. THAT IS --
11 THE COURT: WELL, WE'RE -- I -- I GUESS EVERYBODY
12 AGREES WITH THE GOVERNMENT, YOU, AND I. AND, THAT IS,
13 THERE'S GOT TO BE ADEQUATE EVIDENCE FROM WHICH A REASONABLE JURY
14 COULD FIND BEYOND A REASONABLE DOUBT THAT THERE WAS AN
15 AGREEMENT.
16 MR. FELDMAN: RIGHT.
17 THE COURT: MY QUESTION IS WHETHER MR. IACOBUCCI'S
18 CONVERSATIONS WITH MR. WANG AND MR. SCHULTZ
'
CONVERSATIONS WITH
19 MR. WANG MIGHT EVIDENCE THAT AGREEMENT.
20 MR. FELDMAN: WELL, I THINK THEY THEY ACTUALLY GO
21 THE OPPOSITE WAY, SINCE WHAT THEY WERE ASKING WANG TO DO WAS TO
22 PUT TOGETHER AN AGREEMENT. AND--
23 THE COURT: OH.
24
..
MR. FELDMAN: HE BEGAN TO DO THAT, AND THEN
(
25 STOPPED. I MEAN, THAT'S REALLY WHAT HAPPENED HERE.
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS 8-1336
IF YOU STEP -- IF ONE STEPS BACK FOR A MOMENT AND
LOOKS AT THE TRANSACTION, WHAT HAPPENED HERE IS THAT, JUST AS
YOU SAID, IACOBUCCI AND O'HARA MET IN NEW YORK. AND WHO KNOWS
WHAT O'HARA SAID.
AND IACOBUCCI CLEARLY DID NOT ••• THROW DOWN HIS
BRIEFCASE. AND O'HARA'S VERSION OF WHAT HE SAID CHANGES A
MILLION TIMES.
IACOBUCCI SAYS ON FEBRUARY 3RD, ACCORDING TO O'HARA:
I HAVE TO CHECK WITH MORE PEOPLE; I'LL GET BACK TO YOU.
ON FEBRUARY 23RD HE SAYS, IN EFFECT THE SAME THING:
WE HAVEN'T RECEIVED A PROPOSAL FROM YOU.
ON FEBRUARY 28TH O'HARA SENDS THE PROPOSAL. AND
YOU'VE SEEN ALL THE QUESTIONS THAT APPEAR ON IT, ALL THE CHICKEN
SCRATCHES, INCLUDING ONE AT THE BOTTOM WHICH WE HAVEN'T
EMPHASIZED THAT SAYS: THE WHOLE DEAL IS SUBJECT TO FINANCING,
AND AN ACCEPTABLE PROPOSAL FOR HDTS.
IT'S AT THE BOTTOM OF THAT -- WHAT WE CALL THE O'HARA
PROPOSAL, OR THE 2-28 FAX.
THEY THEN TURN TO WANG TO DRAFT THIS AGREEMENT IN A
PROPER WAY. HE BEGINS THE PROCESS ON MARCH 1ST, AND STAMPS THE
THING "DRAFT". IT STILL HASN'T GONE TO THE LAWYERS. THE DRAFT
IS SENT.
THE DTS PEOPLE GO TO COLOMBIA. THERE'S NO BUSINESS,
THERE'S NOTHING TO DO. THEY COME BACK.
REAL LAWYERS GET INVOLVED, AND A TOTALLY DIFFERENT
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1337
1 DEAL IS DRAFTED.
2 SO UNTIL •••• SO GIVING O'HARA'S TESTIMONY FULL DUE --
3 WHICH I DON'T THINK CAN BE DONE -- WHAT HE SAYS THAT IACOBUCCI
4 SAYS IS: WE CAN'T HAVE A DEAL UNTIL THE LAWYERS DRAFT IT. I
5 CAN'T DO BUSINESS ON A HANDSHAKE.
6 IT'S MORE THAN JUST IT WAS A HANDSHAKE AND IT WAS
7 AMBIGUOUS ABOUT WHETHER THERE WAS A DEAL. THAT'S NOT THE
8 TESTIMONY. THE TESTIMONY IS THERE WAS A HANDSHAKE, BASICALLY
9 SAYING: GOODBY; AND THEN AN EXPLICIT STATEMENT THAT: WE CAN'T
10 DO BUSINESS UNTIL THE LAWYERS GET INVOLVED AND LOOK AT THIS.
11 IT'S VERY CLEAR, AND IT'S REPEATED. AND O'HARA,
12 HIMSELF, SAID THAT HE DID NOT THINK HE WAS WORKING FOR HARRIS
13 AFTER THAT MEETING. O'HARA, HIMSELF, SAYS THAT HE WAS SPENDING
14 MONEY OUT OF HIS OWN POCKET. O'HARA, HIMSELF, SAYS THAT --
15
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THE COURT: ALL RIGHT. FORGET O'HARA.
MR. FELDMAN: YEAH. SORRY.
THE COURT: I THINK I'VE MADE MYSELF CLEAR --
MR. FELDMAN: YES.
THE COURT: -- IF NOT, I'LL REPEAT, THAT IF ALL WE HAD
20 WAS O'HARA'S TESTIMONY, IF THE GOVERNMENT PUT O'HARA ON, AND
21 O'HARA TESTIFIED, AND THE GOVERNMENT RESTED --
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MR. FELDMAN: YES.
THE COURT: -- NONSUIT.
MR. FELDMAN: RIGHT.
THE COURT: OKAY. NO DOUBT ABOUT IT.
CARL R. PLINE OFFICIAL COURT REPORTER
U. s. f)TSTRTC'T C'()III;.lT
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RULE 29 MOTIONS
SO WE'VE GOT TO LOOK AT OTHER THINGS.
MR. FELDMAN: WELL, I'M -- I'M SORRY. THEN I
MISUNDERSTOOD YOUR QUESTION. BUT I THINK THAT THE ANSWER
8-1338
THE COURT: WELL, I -- I THINK WHAT YOU'RE TELLING ME
IS THAT EVEN WITH THE CONVERSATIONS IACOBUCCI HAD WITH WANG --
MR. FELDMAN: RIGHT.
THE COURT: -- GIVING FULL CREDENCE TO WANG'S
TESTIMONY, EVEN IF THEY OCCURRED, AND THERE WAS SOME DISCUSSIONS
IN THERE ABOUT POSSIBLE PAYOFFS, AND THE GESTURE OF THE HANDS
THAT INDICATED AN UNDER-TABLE PAYMENT, THAT THAT STILL NEVER
RESULTED IN AN AGREEMENT.
MR. FELDMAN: IT -- IT'S --
THE COURT: ISN'T THAT
MR. FELDMAN: YES.
THE COURT: -- THE POINT?
MR. FELDMAN: THAT'S MY POINT.
AND I THINK IT'S MOST -- I'LL REST WITH THIS.
I THINK IT'S MOST CLEAR WITH RESPECT TO -- OR IT'S
MOST CLEARLY PROVEN BY THE MAY 1ST PAYMENT.
THAT IS --
THE COURT: WHY?
MR. FELDMAN: BECAUSE THE ABSOLUTE ILLOGIC OF SAYING
THAT THE MAY 1ST PAYMENT WAS FOR A -- WAS CORRUPTLY PAID FOR AN
ACT OR DECISION, SINCE THERE WAS NO ACT OR DECISION SOUGHT. AND
THE GOVERNMENT MUST PROVE --
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS
THE COURT: ALL RIGHT.
MR. FELDMAN: I'LL REST WITH THIS.
8-1339
3 THE GOVERNMENT MUST PROVE THE ACT OR DECISION SOUGHT.
4 IT MUST PROVE THE ACT OR DECISION SOUGHT, AND THAT IT WAS SOUGHT
5 CORRUPTLY. THIS IS NOT THE TIME FOR A WISH, OR A HOPE, OR A
6 PRAYER. THEY HAVE TO ADDUCE EVIDENCE OF WHAT THAT ACT OR
7 DECISION WAS, AND WHETHER IT WAS CORRUPT.
8 AND HONESTLY I THINK THERE ISN'T •••• I MEAN EVEN
9 UNDER THE OLD STANDARD OF A SCINTILLA, I DON'T THINK THERE'S A
10 SCINTILLA OF EVIDENCE ABOUT WHAT THAT PURPOSE WAS, OR WHAT THAT
11 ACT OR DECISION WAS.
12 THE COURT: OKAY. WHAT ABOUT SCHULTZ' CONVERSATIONS
13 WITH •••• WITH WANG AND THAT BRIBE NOTE?
14 MR. FELDMAN: IN TERMS OF WHETHER
15 THE COURT: YOU KNOW, I DON'T •••• I DON'T PUT A GREAT
16 DEAL OF CREDENCE IN THE TELEPHONE CONVERSATION BETWEEN SCHULTZ
17 AND O'HARA.
18 IT SEEMED TO ME LIKE SCHULTZ WAS GIVEN AN INVOICE, AND
19 HE WANTED TO TALK -- WANTED TO TALK TO O'HARA TO FIND OUT WHAT
20 WAS GOING ON.
21 CERTAINLY SCHULTZ' STATEMENTS, EVEN FROM O'HARA, DON'T
22 CONSTITUTE AN AGREEMENT TO ANYTHING.
23 BUT WHEN YOU COMBINE THE NOTE AND YOU COMBINE THE FACT
24 OF PAYMENT ••• AS WELL AS HIS CONVERSATION WITH WANG, THAT --
25 THAT TOO BOTHERS ME.
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RULE 29 MOTIONS
MR. FELDMAN: WELL--
8-1340
THE COURT: I DON'T KNOW WHETHER YOU WERE GOING TO
ADDRESS THAT, OR MR. BREYER IS GOING TO ADDRESS THAT.
MR. FELDMAN: I'M SURE MR. BREYER WILL HAVE SOME
COMMENTS ABOUT IT, BUT LET ME SAY -- LET ME SAY SEVERAL THINGS
ABOUT THAT.
FIRST, I BELIEVE THERE'S EVIDENCE IN THE RECORD NOW
THAT THE -- MR. SCHULTZ' CONDUCT WITH RESPECT TO THE -- WE'VE
GOT A MOTION ABOUT THIS -- THAT MR. SCHULTZ' CONDUCT WITH
RESPECT TO AUTHORIZING THE CHECK REQUEST OCCURRED BEFORE THE
CONVERSATION WITH O'HARA, THE ALLEGED CONVERSATION WITH O'HARA.
THE COURT: I MUST CONFESS THAT THAT POINT HAD MISSED
ME TOTALLY JUST FROM LISTENING TO THE EVIDENCE.
I NOTICED YOU WERE EXAMINING -- ALL OF YOU WERE
EXAMINING ABOUT THE PRECISE TIMES OF THINGS, BUT THE
SIGNIFICANCE OF IT WENT BY ME UNTIL I READ MR. SCHULTZ' MOTION.
MR. FELDMAN: SECOND -- AND THE REASON I REFERRED TO
O'HARA WHEN YOU ASKED ABOUT ONE OF THE OTHER SUBJECTS WAS THAT
WHILE I UNDERSTAND YOUR CONCERN ON THOSE SUBJECTS I THINK THAT
THE FACT THAT THERE WASN'T AN AGREEMENT IS WHAT SHOULD CARRY THE
DAY.
AND WHATEVER MAY APPEAR ON A NOTE, OR IN AN ALLEGED
CONVERSATION DOESN'T CONTROL. IT'S THE ACTUAL FACTS THAT
CONTROL, NOT ••• FOR EXAMPLE, MR. O'HARA'S STATE OF MIND, OR FOR
THAT MATTER MR. WANG'S STATE OF MIND. WHAT CONTROLS IS WHETHER
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1341
1 THERE WAS IN FACT AN AGREEMENT. AND I THINK THAT THE EVIDENCE
2 IS CLEAR THAT THERE WASN'T.
3 SO THE •••• THE -- THE -- IF YOU WILL, THE SIDESHOWS IN
4 MY VIEW CAN'T OVERCOME THE, IN MY VIEW, UNDENIABLE FACTS THAT
5 THERE WASN'T -- SUPPORTING THE LACK OF AGREEMENT.
6 THE COURT: OKAY.
7 NOW, SUPPOSE I AGREE WITH YOU THERE'S NO AGREEMENT
8 WITH RESPECT TO COUNT ONE.
9 MR. FELDMAN: YES.
10 THE COURT: WHAT DOES THAT DO TO TWO, THREE, FOUR, AND
11 FIVE? DOES THAT UNDERCUT ALL OF THOSE COUNTS?
12
13 REAL
MR. FELDMAN: WELL ••• THERE'S A -- THERE'S SOME
THERE ARE TWO PROBLEMS.
14 ONE IS A STRICT LEGAL PROBLEM; THAT IS TO SAY, HOW --
IS WHETHER, AS A MATTER OF LAW, ONE FALLS AFTER THE OTHER.
16 AND THEN THE SECOND IS WHAT DO YOU DO IF YOU CONCLUDE
17 THAT THE SUBSTANTIVE COUNTS COULD STAND, EVEN IN THE ABSENCE OF
18 A CONSPIRACY COUNT.
19 AND I THINK THERE'S A VERY DIFFICULT PROBLEM IN
20 CONNECTION WITH THE SECOND ANALYSIS. BECAUSE ••• THEN A HUGE
21 PORTION OF THIS CASE IS GONE, AND YOU'RE LEFT WITH THE MOST ••••
22 THE COURT: WELL, I'M WONDERING WHETHER I'M LEFT WITH
23 ANYTHING, IF I WERE TO CONCLUDE THERE WAS NO AGREEMENT. BECAUSE
24 OF THE REQUIREMENTS OF TWO, THREE, AND FOUR OF CORRUPT; AND THE
25 REQUIREMENT OF KNOWING; AND, IF THERE WAS NO AGREEMENT, CAN
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RULE 29 MOTIONS
THERE BE CORRUPT AND CAN THERE BE KNOWING?
MR. FELDMAN: RIGHT.
8-1342
I MEAN, IF •••• CERTAINLY, IF THERE'S NO AGREEMENT,
THERE CAN'T BE ANYTHING CORRUPT. AND IF •••• AT A MINIMUM, IF
THERE'S NO AGREEMENT, THERE CAN'T BE ANYTHING CORRUPT.
AND IT WOULD •••• IT WOULD -- I DON'T
THE COURT: WELL, IT SEEMS TO ME --
MR. FELDMAN: -- I DON'T KNOW HOW TO MAKE SENSE OF IT.
THE COURT: IT SEEMS TO ME THAT IF -- WELL, SUPPOSE
WE WERE TO DIRECT A SPECIAL INTERROGATORY TO THE JURY, SAYING:
WAS THERE AN AGREEMENT BETWEEN HARRIS AND O'HARA?
AND THE JURY CAME BACK AND SAID: NO, NO AGREEMENT.
I THINK I WOULD HAVE TO DISMISS COUNTS'TWO, THREE,
FOUR, AND MAYBE COUNT FIVE. I HAVEN'T FINISHED MY ANALYSIS OF
COUNT FIVE YET.
BUT I THINK I WOULD HAVE TO DISMISS COUNTS TWO AND
THREE.
MR. FELDMAN: I -- I DON'T SEE HOW YOU COULD DO
ANYTHING OTHER THAN THAT.
THE COURT: ALL RIGHT.
DO OTHER DEFENDANTS WANT TO ADD SOMETHING?
MR. BREYER: OH.
THE COURT: ROH
R
OR nNO
n
?
MR. BREYER: YES.
MR. CHANIN: VERY BRIEFLY.
CARL R. PLINE OFFICIAL C.OIJRT RFPORTFR
RULE 29 MOTIONS 8-1343
1 WITH RESPECT TO THE MAY 8TH PAYMENT WHICH YOU INQUIRED
2 ABOUT, THE EVIDENCE THAT -- AS I UNDERSTAND IT IS UNDISPUTED
3 THAT THE CHECK REQUEST -- HIDING UNDER THERE (INDICATING) --
4 WHICH MR. IACOBUCCI APPROVED FOR NINETY-FIVE HUNDRED DOLLARS WAS
5 APPROVED AROUND NOONTIME. THE CONVERSATION -- BY MR. IACOBUCCI.
6 THE CONVERSATION BETWEEN MR. SCHULTZ AND MR. O'HARA,
7 WHATEVER MAY HAVE BEEN SAID, WAS ABOUT TWO AND A HALF OR THREE
8 HOURS AFTER THAT --
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THE COURT: WAIT A MINUTE. NOW, WAIT A MINUTE.
YOU'RE -- YOU'RE TALKING ABOUT WHICH DEAL -- OR
MR. CHANIN: THIS IS THE MARCH 8TH.
THE COURT: MARCH. YEAH. SURE. OKAY.
MR. CHANIN: THE MARCH 8TH -- THE NINETY-FIVE HUNDRED
14 DOLLAR PAYMENT.
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THE COURT: YEAH. ALL RIGHT.
MR. CHANIN: AND SO THAT --
THE COURT: THAT IS THE POINT OF MR. SCHULTZ' MOTION.
MR. CHANIN: THAT'S -- THAT'S RIGHT.
THE COURT: OKAY.
20 MR. CHANIN: AND AS TO MR. IACOBUCCI, IT IS EQUALLY,
21 IF NOT MORE, IMPORTANT. HE WAS NOT A PARTICIPANT IN THE PHONE
22 CALL WITH MR. O'HARA. WHATEVER MAY HAVE BEEN SAID, HE APPROVED
23 THE NINETY-FIVE HUNDRED DOLLARS BASED UPON WHATEVER HIS
24 UNDERSTANDING WAS.
25 AND THERE'S NO EVIDENCE THAT WHATEVER WAS SAID TO MR.
CARL R. PLINE OFFICIAL COURT REPORTER
11- S. OTSTRTC:T C:OIIRT
RULE 29 MOTIONS 8-1344
1 SCHULTZ BY MR. O'HARA ••• CAME BACK TO MR. IACOBUCCI.
2 THE -- THE ACT OF THE AUTHORIZATION FROM HIS POINT WAS
3 COMPLETE AROUND NOONTIME; THAT WAS THE LAST THAT HE HAD TO DO
4 WITH THAT.
5 AGAIN, ALTHOUGH I DON'T PUT MUCH CREDENCE IN WHAT MR.
6 O'HARA SAID TO MR. SCHULTZ IN THIS TWO -- I THINK 2:45 P.M.
7 PHONE CALL, THERE'S NO EVIDENCE THAT MR. SCHULTZ EVER RELAYED
8 ANY OF THAT INFORMATION TO MR. IACOBUCCI.
9 THE COURT: OKAY.
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12
MR. BREYER: I HAVE SOME BRIEF REMARKS.
THE COURT: UH-HUH.
MR. BREYER: THE SIGNIFICANCE, YOUR HONOR, OF THE
13 TIMING SHOULDN'T BE LOST FOR PURPOSES OF THIS MOTION, BECAUSE IN
14 FACT IT IS UNCONTRADICTED THAT THE PAYMENT WAS AUTHORIZED AT OR
15 ABOUT NOON. THE CONVERSATION OCCURRED AT OR ABOUT 3:00 P.M.
16 AND, THEREFORE, THE QUOTE nCORRUPT PURPOSE,n WHICH WE
17 BELIEVE THERE'S INSUFFICIENT EVIDENCE FROM WHICH A TRIER OF FACT
18 COULD CONCLUDE GUILT HERE, COULDN'T HAVE TAKEN PLACE. THAT IS,
19 THAT TELEPHONE CONVERSATION -- AND ACCEPTING WHICH ACCEPTING
20 THAT O'HARA SAID THE THINGS THAT HE CLAIMS TO HAVE SAID, OR THAT
21 CHOATE (PHONETIC> SAID IT, AND ACCEPTING PETER WANG'S TESTIMONY
22 TO BE TRUE, THE PAYMENT HAD TO OCCUR AS A MATTER OF FACT,
23 LOGIC AND LOGIC IN ADVANCE OF THAT.
24 SO THEN YOU REALLY GO BACK, YOU GO BACK IN TIME TO AN
25 EARLIER CONVERSATION TO SEE WHETHER THE EARLIER CONVERSATION,
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1345
1 THE TESTIMONY ABOUT THAT MARCH 1ST CONVERSATION, SOMEHOW
2 SUPPLIES THE CORRUPT PURPOSE.
3 AND THERE, WHEN YOU LOOK AT THE TESTIMONY OF PETER
4 WANG, BOTH ON DIRECT AND ON CROSS, WHAT PETER WANG IS SAYING
5 WHEN HE SAID HE WARNED RON SCHULTZ ABOUT THE FOREIGN CORRUPT
6 PRACTICES ACT IS THAT HE, PETER WANG, MADE CONNECTIONS IN HIS
7 MIND, IN HIS MIND THAT SOMETHING WRONG WAS OCCURRING, AND THAT
8 WHAT HE DID WAS HE GAVE RON SCHULTZ A LECTURE OR A STATEMENT
9 ABOUT THE FOREIGN CORRUPT PRACTICES ACT.
10 BUT WHAT HE DOESN'T TESTIFY TO IS THAT HE TOLD
11 SCHULTZ, OR ANYBODY, THAT HE HAD PUT THESE PIECES TOGETHER, AND
12 TOLD THEM ABOUT THESE PIECES.
13 AND WHAT I 'M WHAT I'M TRYING TO ARTICULATE, AND
14 PERHAPS NOT VERY WELL, IS THAT THERE'S A CONFUSION HERE ABOUT
15 WHAT PETER WANG CONCLUDED IN HIS OWN MIND -- ACCEPTING WHAT HE
16 SAYS IS ABSOLUTELY TRUE, ACCEPTING IT AS TRUTH -- WHICH I DON'T
17 BELIEVE IT IS, BUT ACCEPTING IT AS TRUTH -- THAT BECAUSE HE MADE
18 CONNECTIONS IN HIS MIND, AND THEN HE SAID CERTAIN THINGS
19 THE COURT: WAIT A MINUTE. WAIT A MINUTE.
20 MR. BREYER: -- THAT THEREFORE --
21 THE COURT: YOU'RE GOING TO LOSE ME -- YOU'RE GOING TO
22 LOSE HERE NOW.
23 MR. BREYER: OKAY.
24 THE COURT: BACK UP.
25 MR. BREYER: MAYBE I CAN --
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RULE 29 MOTIONS 8-1346
THE COURT: NO, NO. BACK UP. I JUST -- I THINK YOU
CAN CLARIFY IT WITH SOME QUESTIONS.
YOU SAY THAT THE MARCH PAYMENT WAS APPROVED BEFORE
SCHULTZ TALKED WITH O'HARA.
MR. BREYER: YES.
THE COURT: SO THAT'S BEFORE THE SO-CALLED BRIBE NOTE
WAS EVEN IN EXISTENCE.
MR. BREYER: YES.
THE MARCH --
THE COURT: SO IN ORDER TO FIND SOME GUILTY KNOWLEDGE
TO CONNECT UP WITH THE MARCH 1 PAYMENT, WE'VE GOT TO DO
SOMETHING IN TIME BEFORE THE AUTHORIZATION OF THE WIRE TRANSFER.
MR. BREYER: YES.
THE COURT: NOW, WHAT IS THAT?
THAT -- YOU'RE -- YOU'RE ARGUING ABOUT A POSSIBLE
CONNECTION WITH WANG, IN ORDER TO KNOCK IT DOWN; RIGHT?
MR. BREYER: I'M GOING --
THE COURT: BUT DID THAT EVEN OCCUR BEFORE THAT
AUTHORIZATION?
BECAUSE THE ONLY CONVERSATION I REMEMBER BETWEEN
SCHULTZ AND WANG WAS THE ONE AT WHICH THE BRIBE NOTE --
MR. BREYER: NO.
THE COURT: -- WAS DISCUSSED.
MR. BREYER: THERE WAS A -- THERE WAS A --
THE COURT: THERE IS A PRIOR ONE?
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS
MR. BREYER: THERE IS AN EARLIER CONVERSATION
THE COURT: OKAY.
MR. BREYER: -- WHICH OCCURRED ON MARCH 1ST --
THE COURT: OKAY.
8-1347
MR. BREYER: -- THE DAY THAT WANG WAS FIRED, AND ALSO
THE COURT: YEAH, THAT'S RIGHT.
MR. BREYER: -- AND ALSO THE DAY THAT HE WAS HANDED
THE AGREEMENT
THE COURT: UH-HUH.
MR. BREYER: -- TO DRAW UP -- I MEAN HANDED A FAX TO
DRAW UP AN AGREEMENT.
THE COURT: RIGHT.
MR. BREYER: AND HE SAID HE LOOKED AT IT. AND THEN HE
SAYS AND YOU CAN LOOK AT PAGE 2 VOLUME 2, PAGE 102 THROUGH
104, HE SAYS THAT HE MADE A LINK -- THE WITNESS, PAGE 103:
WELL, I IMMEDIATELY MADE A LINK IN MY MIND.
HE MAKES A LINK IN HIS MIND BETWEEN THINGS THAT HE
HEARD EARLIER, AND THEN THIS DOCUMENT. AND WHAT DOES HE SAY?
HE SAYS: I TOLD MR. SCHULTZ THAT HE SHOULD BE CAREFUL OF THE
FOREIGN CORRUPT PRACTICES ACT. OR GIVES A LECTURE ON THE
FOREIGN CORRUPT PRACTICES ACT.
AND WHAT I'M SAYING IS THAT THERE CAN'T -- YOU
CAN'T ~ - THE GOVERNMENT HASN'T BEEN ABLE TO SUPPLY THE CORRUPT
MOTIVE HERE BY VIRTUE OF TESTIMONY OF PETER WANG WHO SAYS HE
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1348
1 MADE A LINK IN HIS MIND. BECAUSE THAT'S NOT AN ARTICULATION OF
2 HIS CONCERNS WHICH WOULD HAVE SUPPLIED THE EVIDENCE -- IF THEY
3 WERE EXPRESSED, WOULD HAVE SUPPLIED THE EVIDENCE OF A CORRUPT
4 MOTIVE.
5 SO I'M SAYING THAT THE TIMING IS EXTREMELY SIGNIFICANT
6 HERE. BECAUSE YOU CAN'T TAKE INTO CONSIDERATION, YOU CAN'T TAKE
7 INTO CONSIDERATION THE PURPORTED CONVERSATION WITH PETER WANG
8 SUBSEQUENT TO THE BRIBE NOTE, BECAUSE THE PAYMENT OCCURRED
9 FIRST. IT OCCURRED BEFORE -- THE PAYMENT ACTUALLY WASN'T MADE
10 BEFORE, BUT THESE DEFENDANTS --
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16 COMMENT?
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THE COURT: WELL, THEY -- THEY AUTHORIZED --
MR. BREYER: THEY DID EVERYTHING NECESSARY.
THE COURT: ALL RIGHT.
I SEE WHAT YOU'RE SAYING.
MR. FELDMAN: JUDGE, MAY I MAKE ONE ADDITIONAL
THE COURT: YES.
MR. FELDMAN: ACTUALLY TWO.
I REALIZE THIS IS NOT AN ARGUMENT TO THE JURY. BUT
20 LET ME SEE HOW TO SAY THIS, IN THE -- GIVEN THE CONTEXT THAT
21 WE'RE IN.
22 THIS IS A RULE 29 MOTION. THIS IS AN OVERWHELMINGLY
23 COMPLICATED STATUTE AND INDICTMENT.
24 IT IS A CASE IN WHICH THERE WAS NO CONTRACT, THERE WAS
25 NO BID, THERE WAS NO BRIBE --
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1349
THE COURT: OH, I UNDERSTAND. 1
2 MR. FELDMAN: AND -- BUT I THINK THAT -- I KNOW YOU
3 UNDERSTAND THAT.
4 THE SECOND THING IS ••• LOOKING AT IT FROM THE
5 PERSPECTIVE OF THE CORPORATION, WHICH AFTER ALL I REPRESENT, I
6 MEAN, WHAT HAPPENED HERE FROM THE CORPORATION'S POINT OF VIEW IS
7 NOTHING.
8 I MEAN, IT -- A GENERAL MANAGER HAD A CONVERSATION IN
9 JANUARY. AND TWO GUYS WENT TO COLOMBIA TO FIND OUT THERE WAS NO
10 BUSINESS, AND CAME BACK AND TURNED THE MATTER OVER TO LAWYERS
11 WHO DRAFTED AN APPROPRIATE AGREEMENT.
12 SO NOTHING HAPPENED. I MEAN, IT'S ALMOST LIKE A
13 MOVIE. I MEAN! NOTHING HAPPENED.
14 AND WE'RE HERE ABOUT NOTHING. AND THE QUESTION IS
15 WHETHER AT THIS STAGE, AT THE RULE 29 STAGE ••• GIVEN THAT
16 ABSOLUTELY NOTHING HAPPENED, WHETHER THERE'S A -- IN MY VIEW,
17 WHETHER THERE'S AN APPROPRIATE, LEGAL WAY TO GET AT THAT.
THE COURT: ALL RIGHT.
COUNSEL FOR THE GOVERNMENT.
18
19
20 MR. MAC KAY: JUDGE, COULD I HAVE THE INDULGENCE OF
21 THE COURT FOR ABOUT FIVE MINUTES BEFORE --
22 THE COURT: YEAH. SURE. I REALIZE I'M -- I'M REALLY
23 THROWING MOST OF THE BURDEN ON YOU FOLKS.
24 MR. MAC KAY: ACTUALLY, IT'S ••• MORE A COMFORT MATTER,
25 AS OPPOSED TO
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS
THE COURT: OKAY.
MR. MAC KAY: -- THE NEED TO PREPARE.
8-1350
I WANT TO HAVE MY MIND FOCUSED ON WHAT I 'M SAYING.
THE COURT: ALL RIGHT. A TEN-MINUTE RECESS.
MR. MAC KAY: THANK YOU, YOUR HONOR.
I THINK I'M READY TO ARGUE THE LEGAL ISSUES.
(LAUGHTER.)
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(PROCEEDINGS RECESSED FROM 8:50 A.M. UNTIL 9:00 A.M.)
THE COURT: ALL RIGHT, MR. MAC KAY.
10 MR. MAC KAY: THANK YOU, YOUR HONOR.
11 I THINK, IF I MAY, I WOULD LIKE TO BEGIN WITH GIVING
12 YOU THE GOVERNMENT'S VIEW ON WHETHER AN AGREEMENT WAS
13 ESTABLISHED. AND OF COURSE I THINK YOU CAN SEE FROM OUR PAPERS
14 THAT WE TAKE THE POSITION THAT OF COURSE THERE WAS AN AGREEMENT.
THE COURT: YES. 15
16 MR. MAC KAY: AND ••• IT'S OUR POSITION THAT THE
17 EVIDENCE WAS CLEAR THAT BETWEEN JANUARY 13TH, WHEN MR. IACOBUCCI
18 MET WITH O'HARA, AND MARCH 9TH OF 1989, WHEN THE NINETY-FIVE
19 HUNDRED DOLLARS WAS WIRED, THAT SERIES OF EVENTS AND
20 TRANSACTIONS CLEARLY SHOWS THAT THERE WAS AN AGREEMENT.
21 NOW, OBVIOUSLY, THE TERMS OF THE AGREEMENT WERE LAID
22 OUT AT THE 1-13 MEETING BETWEEN MR. IACOBUCCI AND MR. O'HARA.
23 IT'S OUR VIEW THAT THE EVIDENCE IS CLEAR THAT BASED ON
24 MR. IACOBUCCI'S RESPONSE HE AGREED, AT LEAST IN PRINCIPLE, TO
25 THE PROPOSAL.
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RULE 29 MOTIONS 8-1351
NOW, MR. FELDMAN CITES THE MELCHOIR-LOPEZ CASE, WHICH
INDEED TALKS ABOUT MERELY AGREEING, OR NEGOTIATING, AND NOTHING
MORE, DOES NOT CONSTITUTE AN AGREEMENT. BUT IN THIS CASE THERE
WAS CONSIDERABLY MORE.
FOR INSTANCE, MR. IACOBUCCI RETURNS TO DTS -- AND YOU
HAVE THE TESTIMONY OF MR. WANG, WHO INDICATED THAT MR. IACOBUCCI
SAID TO HIM: I'VE MET THIS MAN, O'HARA -- OR I'VE MET A MAN IN
NEW YORK WITH CONNECTIONS TO THE COLOMBIAN GOVERNMENT, AND YOU
NEED TO LOOK THE OTHER WAY.
THE SO-CALLED HATS CONVERSATION.
THAT'S CERTAINLY THE FIRST SIGN, INDEPENDENTLY OF THE
MEETING ON 1-13, THAT MR. IACOBUCCI HAS AGREED TO THE SCHEME
THAT MR. O'HARA LAID OUT AT THAT ORIGINAL MEETING.
THEN THAT'S FOLLOWED UP BY THE SERIES OF EVENTS ON
MARCH 1ST, WHERE MR. SCHULTZ TELLS MR. WANG THAT THEY'RE GOING
TO MAKE A PAYMENT TO THE MAN IN NEW YORK NAMED O'HARA. AND MR.
WANG WARNS MR. SCHULTZ THAT IT COULD BE A VIOLATION OF THE FCPA.
AND, AS WE POINT OUT IN OUR PAPERS, WE THINK THE FAIR
INFERENCE FROM THAT, AND FROM THE FACT THAT SOON THEREAFTER THAT
DAY MR. WANG IS FIRED, IT'S OUR VIEW THAT THAT SHOWS THAT MR.
SCHULTZ WENT AND DISCUSSED THE MATTER WITH MR. IACOBUCCI. AND
THE INFERENCE WAS THEY WERE CONCERNED THAT MR. WANG WOULD CAUSE
DIFFICULTIES WITH RESPECT TO THAT DEAL, AND THEY FIRED HIM.
THE COURT: WELL THEN, WHY DID THEY GIVE HIM THE JOB
OF DOCUMENTING THE DEAL?
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1352
1 MR. MAC KAY: HE WAS THE ONLY ONE THAT COULD DO IT AT
2 THAT TIME, YOUR HONOR.
3 THE COURT: WELL ••••
4 MR. MAC KAY: BUT THEN I -- I THINK IT'S CLEAR
5 LATER -- LATER ON THE 8TH -- MARCH 8TH IS REALLY THE SEMINAL
6 DAY, WHERE YOU HAVE THE CONVERSATION BETWEEN MR. WANG AND MR.
7 IACOBUCCI, FOLLOWING THE WANG-SCHULTZ CONVERSATION, WHERE MR.
8 IACOBUCCI CLEARLY INDICATES BY HIS -- HIS COMMENT: SOME OF IT
9 IS A FEE, AND SOME OF IT IS UNDER THE TABLE, MAKING THE SWISHING
10 GESTURE AS REFLECTED IN THE RECORD, AND THE DEMONSTRATION IN
11 WANG'S TESTIMONY.
12 YOUR HONOR, THIS IS ••• EVIDENCE BEYOND A REASONABLE
13 DOUBT IN OUR VIEW THAT THERE'S AN AGREEMENT AT THAT POINT. THAT
14 MR. IACOBUCCI HAS THE INTENT AT THAT TIME TO HAVE AN ILLEGAL
15 AGREEMENT, AS ORIGINALLY PROPOSED BY O'HARA IN THAT 1-13 MEETING
16 IN NEW YORK CITY.
17 MOREOVER, YOU ALSO HAVE THE CONVERSATION INDEPENDENTLY
18 BETWEEN MR. SCHULTZ AND MR. O'HARA ON THE TELEPHONE, WHERE MR.
19 O'HARA, WHO IS THOUGHT TO BE MR. POLLOK BY MR. SCHULTZ, CLEARLY
20 OUTLINES THAT THESE INCIDENTAL FEES ARE A BRIBE. AND THE NOTE,
21 GOVERNMENT EXHIBIT 2, THE SO-CALLED BRIBE NOTE, REFLECTS THAT.
22 THE COURT: WELL, WHAT DO YOU DO WITH THE ARGUMENT --
23 OR DO YOU AGREE WITH EVIDENCE, I GUESS I SHOULD SAY, THAT THE
24 MONEY WAS AUTHORIZED BY MR. SCHULTZ AND MR. IACOBUCCI BEFORE MR.
25 SCHULTZ HAD THE CONVERSATION WITH --
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1353
MR. MAC KAY: WELL, FIRST, YOUR HONOR, WE --
THE COURT: -- O'HARA/POLLOK.
1
2
3 MR. MAC KAY: RIGHT. WE DON'T THINK THAT THE -- THE
4 EVIDENCE IS ALL THAT CLEAR.
5 MR. WIDEN I BELIEVE TESTIFIED THAT HE THOUGHT IT WAS
6 AROUND NOON, BUT HE ALSO SAID nLUNCHTIME
n
• LUNCH COULD RUN
7 ANYWHERE FROM NOON TO 4:00 O'CLOCK.
8 WE DON'T THINK THAT'S NECESSARILY UNDISPUTED EVIDENCE.
9 HOWEVER, LET'S ASSUME THAT -- THAT IN FACT THE
10 AUTHORIZATION, THE CHECK REQUEST WAS DONE BEFORE THE
11 CONVERSATION.
12 WITH REGARD TO MR. IACOBUCCI, WE BELIEVE THAT BASED ON
13 HIS INTERACTION OR HIS MEETING WITH MR. O'HARA ON THE 13TH OF
14 JANUARY, AND THEN HIS SUBSEQUENT CONVERSATIONS WITH PETER WANG,
15 THAT HE CLEARLY KNEW WHAT THE INCIDENTAL FEES WERE FOR PRIOR TO
16 THAT.
17 AND THAT IN EFFECT ON 1-13, JANUARY 13TH, WHEN HE MET
18 WITH MR. O'HARA, AND THEN LATER WHEN HE REVEALED HIS
19 UNDERSTANDING OF WHAT MR. O'HARA WAS PROPOSING, AND THE FACT
20 THAT HE WAS AGREEING TO IT TO MR. WANG ON MARCH 1ST AND MARCH
21 8TH, HE.BY THOSE ACTIONS HAD ALREADY IN EFFECT MADE AN
22 AUTHORIZATION TO PAY THE MONEY TO MR. O'HARA.
23 AND THE MERE FACT THAT HE SIGNED THE CHECK REQUEST
24 BEFORE OR AFTER THE CONVERSATION, WITH RESPECT TO MR. IACOBUCCI,
25 DOESN'T MAKE IT ANY LESS A CORRUPT USE OF A MEANS OR
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RULE 29 MOTIONS
INSTRUMENTALITY IN FURTHERANCE OF THE AUTHORIZATION
8-1354
THE COURT: WELL, IT WOULD LET MR. SCHULTZ OUT ON THAT
COUNT, THOUGH, WOULDN'T IT?
MR. MAC KAY: WELL, WITH RESPECT TO MR. SCHULTZ, YOUR
HONOR, ASSUMING THAT THE CONVERSATION WITH O'HARA OCCURRED AFTER
THE AUTHORIZATION, NONETHELESS, THE TRANSFER WASN'T MADE UNTIL
THE NEXT DAY. AND MR. SCHULTZ DID NOTHING TO STOP IT.
AND WE FEEL THAT, IF ANYTHING, IS AIDING AND ABETTING.
SO ••• YOU KNOW --
THE COURT: WELL, WHAT DO YOU -- WHAT DO YOU DO -- HOW
DO YOU RECONCILE THE BASIC FACT THAT NO MONEY EVER REALLY GOT
PAID?
NO •••• HARRIS DIDN'T SUBMIT A BID FOR ANYTHING,
HARRIS DIDN'T ENTER INTO A CONTRACT OR ANYTHING. AND THE
ULTIMATE CONTRACT THAT WAS SIGNED UP BETWEEN HARRIS AND O'HARA
WAS TOTALLY DIFFERENT FROM THE THINGS THAT THEY STARTED TALKING
ABOUT ON JANUARY THE 13TH.
IT MAKES ME THINK THAT YOU -- BECAUSE WANG CAME TO YOU
AND HAD OVER THE FULL SPECTRUM OF THE EVENTS THIS VIEW OF IT
ARE TAKING THAT VIEW.
AND IT'S -- IT'S DIFFICULT FOR ME TO SEE -- AND I'M
NOT EXPRESSING THIS VERY WELL -- I JUST HAVE THIS BASIC
DISCOMFORT THAT WE'RE ASKING A JURY TO CONVICT THESE PEOPLE OF
SOMETHING ON A DEAL THAT NEVER GOT DONE.
MR. MAC KAY: WELL, YOUR HONOR
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1355
1 THE COURT: AND WE ALL KNOW, WE ALL KNOW, BASIC
2 CONSPIRACY LAW DOESN'T REQUIRE THE DEAL ACTUALLY GET DONE.
3
4
MR. MAC KAY: EXACTLY.
THE COURT: BUT IT DOES REQUIRE AN AGREEMENT.
5 AND WITH THE THING BEING AS FLUID AS IT WAS,
6 ULTIMATELY RESULTING IN NO AGREEMENT AT ALL
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MR. MAC KAY: BUT--
THE COURT: VIS-A-VIS COLOMBIA, IT JUST GIVES ME
THIS VERY GREAT LEVEL OF DISCOMFORT.
MR. MAC KAY: BUT THERE WERE TWO PAYMENTS, YOUR HONOR.
11 TWO PAYMENTS.
12
13
THE COURT: OKAY. WELL--
MR. MAC KAY: FIFTY-FIVE HUNDRED DOLLARS AND THREE
14 THOUSAND, BOTH OF WHICH RELATED TO THE INCIDENTAL fEES THAT HAD
15 BEEN DISCUSSED ON THE -- ON THE 13TH Of JANUARY, AND THEN AGAIN
16 ON MARCH 8TH.
17 AND -- AND, YOUR HONOR, THAT IS THE EVIDENCE. THAT IS
18 THE EVIDENCE THAT THERE WAS --
THE COURT: THE PAYMENTS. 19
20 MR. MAC KAY: YEAH. THE FACT THAT THEY ULTIMATELY
21 DIDN'T REACH A CONTRACT HAS NO EFFECT, INSOFAR AS THEY MADE TWO
22 PAYMENTS.
23 AND THAT'S WHAT DISTINGUISHES --
24 THE COURT: BUT WHAT ABOUT O'HARA SAYING ON THE
25 WITNESS STAND: I WAS LYING TO IACOBUCCI; I WAS LYING TO
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1356
1 SCHULTZ. I HAD ABSOLUTELY NO INTENT AT ALL OF EVER PAYING THAT
2 MONEY ANYWHERE. IT WAS FOR ME.
3 MR. MAC KAY: WELL, HE -- THAT'S -- HE SAID THAT, YOUR
4 HONOR. BUT HE ALSO SAID: IF IT WERE NECESSARY, I WOULD PAY.
5 HE SAID THAT THREE TIMES.
6 AND I HAVE -- I HAVE IT IN THE TRANSCRIPT HERE. I
7 WOULD BE HAPPY TO SHOW YOU --
8 THE COURT: OH, I THINK YOU'RE RIGHT. I THINK HE DID
9 SAY THAT.
10 THERE'S NO DOUBT IN MY MIND O'HARA WOULD HAVE DONE
11 WHATEVER HE FELT HE HAD TO DO TO GET ANY DEAL AT ALL.
12 MR. MAC KAY: NOW, YOUR HONOR, IT'S CLEAR -- IT'S
13 CLEAR THAT MR. O'HARA WAS IN FACT SCAMMING THE COMPANY TO SOME
14 DEGREE. BUT HE ALSO HAD THE REQUISITE INTENT TO PAY THOSE
15 INCIDENTAL FEES TO OFFICIALS OF TELECOM IF NECESSARY.
16 AND WE THINK THAT'S ENOUGH TO SUSTAIN THE
17 CONSPIRATORIAL AGREEMENT WITH RESPECT TO THE TELECOM PAYMENTS.
18 NOW, WITH RESPECT TO LOPEZ, HE CLEARLY -- HE CLEARLY
19 ENTERTAINED A THOUGHT THAT HE WAS GOING TO MAKE SURE LOPEZ GOT
20 PART OF THE COMMISSIONS. THAT'S -- I DON'T THINK THAT'S BEEN
21 ATTACKED.
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24
HE --
THE COURT: WELL, BUT COMMISSIONS FOR WHAT?
MR. MAC KAY: THE COMMISSIONS FOR ANY BUSINESS THAT
25 MIGHT BE DONE. THAT WAS THE BRIBE, SO TO SPEAK; OR THE PAYMENTS
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RULE 29 MOTIONS 8-1357
THAT WOULD BE MADE TO MR. LOPEZ, CONGRESSMAN LOPEZ.
AND THAT'S REALLY PART THE SECOND PRONG OF THE SAME
BRIBERY CONSPIRACY. THE INCIDENTAL FEES, AND THE COMMISSIONS TO
MR. LOPEZ.
NOW, THE MERE FACT THAT THEY NEVER GOT ANY BUSINESS,
AND THERE WERE NO COMMISSIONS DOESN'T MEAN THAT THERE COULDN'T
BE A CONSPIRATORIAL AGREEMENT TO PAY THOSE COMMISSIONS.
THE COURT: WELL, I'VE ALREADY DETERMINED BY A
PREPONDERANCE OF THE EVIDENCE THAT THERE WASN'T AN AGREEMENT
WITH RESPECT TO O'HARA AND LOPEZ.
MR. MAC KAY: WELL, THAT'S -- THAT'S FINE, YOUR HONOR.
12 I -- I UNDERSTAND YOU DID THAT, AND WE'VE TAKEN AN OPPOSITE
13 POSITION
THE COURT: YES. 14
15 MR. MAC KAY: BUT THAT'S YOUR FINDING.
16 THAT STILL DOES NOT AFFECT THE AGREEMENT BETWEEN
17 O'HARA AND THE COMPANY, PARTICULARLY MR. IACOBUCCI, WITH RESPECT
18 TO WHAT THEY WERE AGREEING TO DO WITH THE COMMISSIONS.
19 WHETHER LOPEZ KNEW ANYTHING ABOUT IT OR NOT, THE FACT
20 OF THE MATTER
21 THE COURT: WELL, DID THEY EVER AGREE ON COMMISSIONS?
22 I MEAN, I CAN -- I CAN SEE HOW YOU CAN ARGUE THAT
23 THERE WAS SOME AGREEMENT WITH RESPECT TO SOME UP-FRONT BRIBE
24 MONEY -- AT LEAST ARGUE IT -- BY SAYING ON MARCH THE 8TH THE
25 MONEY GOT TRANSFERRED. MAYBE YOU CAN ARGUE ON MAY THE 1ST.
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1358
1 BUT CAN -- WHAT'S -- WHAT'S THE EVIDENCE THAT HARRIS
2 AGREED TO THE PAYMENT OF COMMISSIONS?
3 MR. MAC KAY: THE FACT THAT THEY MADE THE TWO
4 PAYMENTS, THE FIFTY-FIVE HUNDRED DOLLARS AND THE THREE THOUSAND
5 DOLLARS ESSENTIALLY BASED ON THAT 2-28 FAX, THE ORIGINAL FAX
6 FROM O'HARA DETAILING HIS PROPOSAL. THE FACT THAT THEY PAID
7 PURSUANT TO THAT AGREEMENT. THE FACT THAT WHEN MR. --
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THE COURT: WELL, WHAT -- WHAT IS THAT EXHIBIT NUMBER?
MR. MAC KAY: I CAN TELL YOU IN A SECOND, YOUR HONOR.
MR. FELDMAN: 42.
THE COURT: 42?
MR. FELDMAN: DEFENDANTS' 301 IS THE ONE WITH THE
13 HANDWRITING ON IT; AND 42 IS THE GOVERNMENT'S VERSION, I
14 BELIEVE.
15 MR. MAC KAY: IF YOU'LL REMEMBER, YOUR HONOR, THE
16 TESTIMONY OF MR. WIDEN YESTERDAY
17 THE COURT: WELL, HANG ON A MINUTE.
18 (COURT REVIEWING EXHIBIT.)
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MR. MAC KAY: DO YOU HAVE IT, SIR?
THE COURT: YEAH. I'M READING IT.
MR. MAC KAY: OKAY.
THE COURT: OKAY.
SUPPOSE THIS WERE A CIVIL CASE. O'HARA ••• SENDS A
24 PROPOSAL TO HARRIS. A FEW DAYS LATER HARRIS WIRES FIFTY-FIVE
25 HUNDRED TO O'HARA.
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTIONS
HAVE THEY MADE A CONTRACT?
8-1359
MR. MAC KAY: YOU'RE ASKING THE WRONG GUY, YOUR HONOR.
THE COURT: WELL--
MR. MAC KAY: BUT, NO. LET--
THE COURT: -- MY POINT IS --
MR. FELDMAN: I HAVE AN ANSWER.
THE COURT: -- IF THEY HAVEN'T MADE A CONTRACT ON A
CIVIL BASIS, YOU KNOW, CAN I REALLY SAY THAT'S ADEQUATE EVIDENCE
TO SUBMIT TO A JURY TO DETERMINE BEYOND A REASONABLE DOUBT THAT
THEY MADE ONE?
MR. MAC KAY: SURE YOU CAN.
I MEAN, I -- I THINK IT'S INTERESTING YOU SHOULD RAISE
THAT, YOUR HONOR, BECAUSE IN ONE OF THE CASES CITED BY MR.
FELDMAN IN HIS PAPERS, THE MELCHOIR-LOPEZ CASE --
THE COURT: UH-HUH.
MR. MAC KAY: -- THE NINTH CIRCUIT SAYS: ALTHOUGH THE
EVIDENTIARY REQUIREMENT FOR ESTABLISHMENT OF AN AGREEMENT IN THE
CONSPIRACY CONTEXT IS CONSIDERABLY MORE LAX THAN IN THE CASE OF
AN ENFORCEABLE CONTRACT, INFERENCES OF THE EXISTENCE OF SUCH AN
AGREEMENT MAY BE DRAWN QUOTE "IF THERE BE CONCERT OF ACTION, ALL
THE PARTIES WORKING TOGETHER UNDERSTANDINGLY WITH A SINGLE
DESIGN FOR THE ACCOMPLISHMENT OF A COMMON PURPOSE."
AND -- AND OUR VIEW IN THIS CASE IS WE HAD JUST THAT
WITH RESPECT TO THE TERMS LAID OUT IN THIS PROPOSAL. AND -- AND
YOU SEE IT FROM THE EVIDENCE, YOUR HONOR. YOU SEE IT -- IN FACT
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULE 29 MOTIONS 8-1360
1 THEY SENT THE LETTER TO INTERDELTA AS REQUESTED IN THE 2-28 FAX
THERE. 2
3 THEY HAD MR. WANG DRAFT AN AGREEMENT TO CONSIDER
4 REFLECTING THESE TERMS. MR. WANG DID THAT. AND THAT'S THE
5 EXHIBIT A THAT'S •••• MULTIPLE COPIES ARE IN EVIDENCE.
THE COURT: YES. 6
7 MR. MAC KAY: AND THEN YOU SEE IT TALKS ABOUT THE
8 INCIDENTAL FEES. AND YOU TIE THE INCIDENTAL FEES INTO THE
9 ORIGINAL DISCUSSION WITH MR. IACOBUCCI AND MR. O'HARA. AND
10 THAT'S FOLLOWED BY THE PAYMENT, TWO PAYMENTS OF INCIDENTAL FEES;
11 THE MARCH 9TH PAYMENT, AND THE MAY 1ST PAYMENT.
12 AND YOU REMEMBER MR.
13 THE COURT: WELL, HOW DO YOU CHARACTERIZE THAT MAY 1ST
14 PAYMENT? I'M STILL FUZZY ON THAT.
15 YOU -- YOU SAY THEY WERE PAYING HIM FOR SOMETHING
16 ALREADY DONE, OR ••• ?
17 MR. MAC KAY: THAT'S CORRECT, YOUR HONOR.
18 THE COURT: PAYING O'HARA FOR SOMETHING ALREADY DONE?
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MR. MAC KAY: YES, SIR.
THE COURT: OKAY.
ON NEXT PAGE.)
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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RULE 29 MOTION 8-1361
MR. MAC KAY: OUR THEORY OF THE MAY 1ST PAYMENT
IS AS FOLLOWS:
THAT, WITH RESPECT TO MR. IACOBUCCI, AS I HAVE ALREADY
STATED, BETWEEN JANUARY 13 AND MARCH 8TH, MR. IACOBUCCI CAME TO
AN AGREEMENT WITH MR. O'HARA AND, IN EFFECT, AUTHORIZED PAYMENTS
TO MR. O'HARA.
ON MARCH 8TH, MR. SCHULTZ DID THE SAME, BASED ON THE
TELEPHONE CONVERSATION. THOSE WERE THE -- AT THAT POINT, YOU
HAD AN AUTHORIZATION FROM THOSE INDIVIDUALS, OKAY, AT LEAST BY
MARCH 8TH.
COUNT FOUR, WHICH DISCUSSES OR CHARGES THE MAY 1ST
PAYMENT, AT THAT POINT, MAY 1ST, THAT'S SIMPLY WHEN THE
DEFENDANTS CORRUPTLY USED THE MEANS AND INSTRUMENTALITY OF
INTERSTATE COMMERCE, THE BANK WIRE, WITH REGARD TO THAT ORIGINAL
AUTHORIZATION. SO THE AUTHORIZATION WAS MADE BACK AT A TIME
WHEN, CLEARLY, ALL THE DEFENDANTS HAD AN IDEAL
THE COURT: HOLD ON. I'M LOST. WHAT DID THE
MONEY REPRESENT? WHAT DID THAT SECOND 9,500 REPRESENT?
THE DEFENDANTS SAY THEY WERE JUST A NEGOTIATED NUMBER OF
SOME KIND; THAT THEY WERE CUTTING O'HARA DOWN, BUT, NOW, YOU'RE
SAYING THAT SOME OF THAT IS SPECIFICALLY EARMARKED FOR BRIBE
MONEY.
MR. MAC KAY: ABSOLUTELY, YOUR HONOR. THAT'S OUR
THEORY.
THE COURT: BUT BY MAY, ISN'T IT PRETTY CLEAR
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION 8-1362
1 THAT THERE WASN'T ANYBODY TO BRIBE?
2 MR. MAC KAY: THE DEFENDANTS HAD NO REASON NOT TO
3 BELIEVE THAT IN MARCH O'HARA HADN'T ALREADY OFFERED, PROMISED OR
4 GIVEN MONEY TO FOREIGN OFFICIALS FOR THE CORRUPT PURPOSE, AND
5 THE MERE FACT THAT THE PAYMENT COMES AFTER THE BRIBE DOESN'T
6 MEAN THAT THEY STILL DON'T HAVE THE REQUISITE INTENT, AND THERE
7 IS A D. C. CIRCUIT CASE.
8 THE COURT: I AGREE YOU CAN AGREE TO DO IT ONE DAY
9 AND PAY THE MONEY LATER.
·10 MR. MAC KAY: BECAUSE IF YOU DIDN'T DO IT THAT
11 WAY, IT WOULD BE VERY EASY TO STRUCTURE IT AROUND THE STATUTE.
12 THE COURT: WOULDN'T YOU HAVE TO CONNECT THE
13 PAYMENT WITH SOMETHING? WHAT YOU ARE SAYING IS THAT YOU ARE
14 CONNECTING IT WITH THE EARLIER, QUOTE, AGREEMENTS?
15 MR. MAC KAY: AND THE CONNECTOR IS THE TERM
16 "INCIDENTAL FEES", THE 3,000 OF THAT MAY 13, 3,000 OF THAT, AS
17 YOU MAY RECALL FROM THE EXHIBIT, WAS ACTUALLY INCIDENTAL FEES.
18 AND WE FEEL THAT AT THE TIME THAT THIS MONEY WAS WIRED, IT WENT
19 BACK TO THAT ORIGINAL AUTHORIZATION AND THE DEFENDANTS KNEW
20 WITHIN THE MEANING OF THE STATUTE THAT IT DID GO BACK TO THAT
21 ORIGINAL AUTHORIZATION AT A TIME WHEN CLEARLY THEY CONTEMPLATED
22 STILL DOING BUSINESS WITH TELECOM.
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THE COURT: OKAY.
MR. MAC KAY: AND JUST ONE POINT I'D LIKE TO MAKE
25 ABOUT THE EVIDENCE ON THE AGREEMENT, YOUR HONOR.
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION 8-1363
1 YOU MAY RECALL THE TESTIMONY OF MR. WIDEN YESTERDAY, WHEN
2 MR. SCHULTZ BROUGHT HIM THE FIRST AUTHORIZATION FOR $9500. MR.
3 WIDEN TESTIFIED THAT HE ASKED MR. SCHULTZ" "DO YOU HAVE AN
4 AGREEMENT WITH THIS GUY O'HARA OR POLO ASSOCIATES?"
5 SO MR. SCHULTZ RESPONDED, ACCORDING TO MR. WIDEN'S
6 TESTIMONY, "YES, WE HAVE AN AGREEMENT AND JACK'S APPROVED IT",
7 OR WORDS TO THAT EFFECT.
8 AND TO ADDRESS YOUR CONCERN ABOUT AN AGREEMENT, YOUR
9 HONOR, THAT'S SORT OF THE ICING ON THE CAKE AT THAT POINT TO
10 SHOW THAT THERE WAS INDEED AN AGREEMENT.
11 I GUESS ONE OTHER POINT I '0 LIKE TO MAKE, YOUR HONOR, AND
12 UNDERSTAND AND I APPRECIATE THAT THE COURT DISCERNED THE FACTS
13 THAT WITH RESPECT TO COUNTS TWO, THREE AND FOUR, THE INTENT OF
14 O'HARA IS REALLY IRRELEVANT.
15 THE FACT THAT O'HARA MAY HAVE WANTED TO POCKET THE MONEY,
16 THROW IT AWAY, DO WHATEVER HE WANTS WITH IT, THAT'S REALLY
17 IRRELEVANT TO THE CORRUPT INTENT OF THE DEFENDANTS.
18 THE COURT: AGREE, BUT ISN'T -- LET ME ASK THE
19 SAME QUESTION I ASKED THEN.
20 IF I WERE TO DETERMINE THAT NO AGREEMENT HAS BEEN SHOWN
21 OR NO REASONABLE JURY COULD FIND BEYOND A REASONABLE DOUBT THAT
22 THERE WAS AN AGREEMENT TO DO SOMETHING, DON'T COUNT TWO, COUNT
23 THREE, AT LEAST COUNTS TWO, THREE AND FOUR FALL BECAUSE WITH
24 THAT, YOU DO NOT HAVE ANY CORRUPT INTENT OR ANY KNOWING ACTION.
25 MR. MAC KAY: I BELIEVE, YOUR HONOR, I HAVE TO
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
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RULE 29 IVIOTION 8-1364
TAKE EXCEPTION TO THAT PROPOSITION.
THE COURT: YOU THINK SO?
MR. MAC KAY: YES, SIR.
THINK THAT EVEN IF YOU FIND THAT THE DEFENDANTS DIDN'T
AGREE TO THE SPECIFIC TERMS OF THE PROPOSAL THAT MR. O'HARA MADE
WITH THAT 2-28 FAX, YOU STILL, WITH RESPECT TO COUNT TWO, THREE
AND FOUR, YOU STILL HAVE A SITUATION WHERE MR. O'HARA IS
REPRESENTING TO THOSE INDIVIDUALS, TO THE DEFENDANTS AND THE
COMPANY, WHAT HE IS GOING TO DO WITH THESE INCIDENTAL FEES. AND
THEY ACT UPON THOSE REPRESENTATIONS. THEREFORE, THEY KNEW THAT
HE WOULD DO WHAT HE'S REPRESENTING AND, YOU KNOW, WE MAY BE
TRYING TO SLICE IT TOO MANY WAYS, BUT THAT'S NOT CONTINGENT UPON
THE EXISTENCE OF AN AGREEMENT.
THE COURT: WELL, ISN'T IT? NOW, LET'S SEE.
COUNTS TWO, THREE AND FOUR INVOLVE 78(D)(D)-1A3.
MR. MAC KAY: RIGHT.
THE COURT: THAT REQUIRES THAT AN ISSUER -- AND
IT'S AGREED THIS COMPANY IS AN ISSUER OR ANY AGENT OF THE
ISSUER, AND CERTAINLY, MR. IACOBUCCI AND MR. SCHULTZ WERE
AGENTS -- CORRUPTLY. OKAY.
AND THEN WE GET DOWN TO 3, KNOWINGLY -- I'M SORRY.
"WHILE KNOWING THAT ALL OR PORTION OF SUCH IVIONEY WILL BE
OFFERED", ET CETERA. NOW, DOESN'T THAT REQUIREMENT OF KNOWING
THAT ALL OR A PORTION OF THE IVIONEY WILL BE OFFERED, DOESN'T THAT
SORT OF REQUIRE THE ESTABLISHMENT OF AN AGREEMENT BEFORE ANY
RFPnRTFR_
RULE 29 IVIOTION 8-1365
1 JURY COULD FIND KNOWING?
2 MR. MAC KAY: I'M TRYING TO FIND, IF YOU GO TO
3 78(D)(D)-1F2A, IT DEFINES "KNOWING", THE STATUTE, ITSELF,
4 DEFINES KNOWING.
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THE COURT:
MR. MAC KAY:
WAIT A MINUTE. STAY WITH ME.
THINK THE DEFINITION OF
7 "KNOWING", AS USED IN THE STATUTE, FALLS FAR SHORT OF THE NEED
8 TO ESTABLISH AN AGREEMENT.
9 THE COURT: HANG ON ONE SECOND. LET ME READ THE
10 LANGUAGE.
1 1 MR. MAC KAY: YOUR HONOR, IF I MAY, LET ME
12 PARTICULARLY POINT OUT TO YOU F2(B) AND THE KNOWING DEFINITION.
13 IT SAYS, "WHEN KNOWLEDGE OF THE EXISTENCE OF A PARTICULAR
14 CIRCUMSTANCE IS REQUIRED FOR AN OFFENSE, SUCH KNOWLEDGE IS
15 ESTABLISHED IF A PERSON IS AWARE OF A HIGH PROBABILITY OF THE
16 EXISTENCE OF SUCH CIRCUMSTANCE UNLESS THE PERSON ACTUALLY
17 BELIEVES THAT SUCH CIRCUMSTANCE DOES NOT EXIST."
18 THINK THAT FALLS FAR SHORT OF ACTUALLY HAVING TO HAVE
19 AN AGREEMENT. IT'S ENOUGH THAT THEY HAVE A -- THAT THEY ARE
20 AWARE OF A HIGH PROBABILITY. THAT'S A LESSER STANDARD THAN A
21 AGREEMENT, YOUR HONOR, WITH RESPECT TO KNOWLEDGE, AT LEAST IN
22 THE GOVERNMENT'S VIBN.
23 THE COURT: OKAY.
24 MR. MAC KAY: AND I DON'T WANT TO SEPARATELY
25 ADDRESS COUNT FIVE NOW. WE HAVE SUBMITTED ALL KINDS OF PAPERS
R O ~ I TA FI O A F ~ OFF I (" I AI rnllClT CI&:'cnDT&:'D 11C!1"\r-
1 ON THAT.
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READING.
RULE 29 MOTION 8-1366
THE COURT: YES, I STILL HAVEN'T COMPLETED MY
STILL HAVE TO DIG UP SOME MORE ON THAT.
MR. MAC KAY: UNFORTUNATELY, THERE IS NOT ANY LAW
5 ON THAT PARTICULAR SECTION.
6 THE COURT: I'M TRYING TO WALK THROUGH THE
7 STATUTE. THAT'S A DIFFICULT WALK.
8 MR. MAC KAY: BUT I CERTAINLY CONCUR WITH YOUR
9 COMMENT ABOUT THAT STATUTE.
10 THE COURT: LET ME JUST TALK ABOUT IT BRIEFLY.
11 GATHER THAT THE SECTION CITED IN THE INDICTMENT ON COUNT FIVE,
12 WI-"'CH IS 78M(B) (2) (A), THAT IS MODIFIED, IS IT NOT, BY (B) (4)
13 AND (B)(5)?
14 MR. MAC KAY: YES.
15 THE COURT: IT'S REALLY THE STANDARD OF (B)(4) AND
16 (B)(5) THAT I HAVE TO LOOK TO.
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MR. MAC KAY: (B)(5) IS ACTUALLY THE CRIMINALIZED
THE COURT: THAT'S WHERE I GOT TO WORK.
MR. MAC KAY: YES, YOUR HONOR.
THE COURT: SO (B)(2)(A) DEFINES THE CONDUCT OR
22 REQUIRED STANDARD CONDUCT, AND (B)(5) DEALS WITH WHAT'S
23 CRIMINAL?
24 MR. MAC KAY: INDEED. THAT'S AN IMPORTANT
25 DISTINCTION IN THE SENSE THAT THE ACCURACY OF THE BOOKS AND
1 TA 1=1 nCI=C: nrr I,.... I 11.1 ... I""\n"""''''n ..............
RULE 29 MOTION 8-1367
1 RECORDS IS AN ISSUE QUITE APART FROM FALSIFYING.
2 THE COURT: RIGHT, RIGHT. SO YOU CAN DO SOMETHING
3 ABOUT IT, IF THEY DON'T.
4
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MR. MAC KAY: THAT'S RIGHT, YOUR HONOR.
THE COURT: OKAY.
DEFENDANTS WISH TO REPLY?
MR. BREYER: YES. YOUR HONOR.
8 LET ME JUST GO, FIRST, BRIEFLY, BECAUSE OF SOMETHING THE
9 GOVERNMENT HAS SAID THAT THE ICING ON THE CAKE TO ESTABLISH AN
10 AGREEMENT WAS MR. WIDEN'S TESTIMONY YESTERDAY.
11 THE COURT:
12 THAT HERE. OKAY.
13
14
(PAUSE. )
MR. BREYER:
HANG ON ONE MINUTE. LET ME SEE ABOUT
THE PROBLEM YOU ALWAYS HAVE WITH THE
15 ENGLISH LANGUAGE OR ANY LANGUAGE IS THE FACT THAT WHEN YOU USE A
16 OORD LI KE "AGREEMENT" I N AN ARGUMENT OR I N TEST IMONY, YOU MAY BE
17 TALKING ABOUT MANY DIFFERENT THINGS. SO YOU HAVE TO LOOK AND
18 THE GOVERNMENT SAYS, MR. WIDEN TESTIFIED THAT THERE WAS AN
19 AGREEMENT, WHICH IS THE ICING ON THE CAKE -- THAT TO SHOW THAT
20 THERE WAS THERE ILLEGAL AGREEMENT, YOU HAVE TO LOOK AND SEE WHAT
21 MR. WIDEN SAID.
22 WHAT HE SAID APPEARS ON PAGE 1224 AND IS REITERATED ON
23 PAGE 1226, AND I OOULD SAY THIS IS THE DIRECT EXAMINATION. AND
24 IN THAT TESTIMONY, WHICH I HAVE JUST BEEN HANDED THE TRANSCRIPT,
25 IT'S YESTERDAY, OF VOLUME 7, MR. WIDEN SAYS THAT THERE WAS AN
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
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RULE 29 MOTION 8-1368
AGREEMENT -- HE ASKED MR. SCHULTZ WHETHER THERE WAS AN AGREEMENT
AS TO WHAT THESE EXPENSES WERE FOR, THE $9500.
AND MR. SCHULTZ -- AND ASKED WHY HE ASKED THAT, HE SAYS
ON PAGE 1226, -- OR QUESTION BY THE GOVERNMENT, PARDON
ME, "WHY WAS IT NECESSARY TO ASK THIS QUESTION?"
AND MR. WIDEN SAYS, "I WANTED TO MAKE SURE THERE WAS AN
UNDERSTANDING BY BOTH PARTIES OF WHAT THE MONEY WAS TO COVER,
THE $9500."
AND ON PAGE 1224, HE SAYS, QUESTION, "WHAT QUESTION DID
YOU ASK HIM?
ANSWER BY MR. WI DEN, "I ASKED RON I F THERE I S AN
AGREEMENT IN PLACE COVERING THESE EXPENSES.
ri
"DID MR. SCHULTZ RESPOND?"
"YES, HE DID".
"HOW DID HE RESPOND?
HE SAID, "YES, AN AGREEMENT. THAT IS, HAD AN
UNDERSTANDING AS TO WHAT THESE FUNDS WERE FOR", THE $9500. THEY
FOR EXPENSES AND THEY WERE FOR THE MODEL REP FEE. I'M NOW
ADDING SOMETHING THAT'S NOT IN THE TRANSCRIPT BUT THE DOCUMENT
ITSELF REFLECTS THAT.
SO I THINK THAT HAVE TO BE VERY CAREFUL WHEN WE
USE TERMS LIKE "AGREEMENT" AS TO WHAT WE'RE TALKING ABOUT IN THE
CONTEXT OF THE TESTIMONY.
AND, FINALLY, YOUR HONOR, ALL THE DEFENDANTS HAVE MOVED
PURSUANT TO RULE 29 FOR A DISMISSAL OF THESE, FOR A JUDGMENT OF
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION 8-1369
1 ACQUITTAL FOR ALL THESE COUNTS.
2 ~ SPECIFICALLY ADDRESSED WHY. I THINK THE COURT IS
3 APPROACHING IT FROM THE LARGER PICTURE FIRST.
4 THE COURT: YES, I AM, AND YOU RAISED THAT POINT
5 THAT, YOU KNOVV, IF I DISMISSED EVERYTHING HERE AND GRANT AN
6 ACQUITTAL HERE ON EVERYTHING, WE DON'T NEED TO GET TO THE
7 SMALLER POINTS. BUT AT THE SAME TIME, ON THAT, I'M NOT GIVING
8 THE OPPORTUNITY YET TO ARGUE THE 4 SEGMENTS OF THE MOTION EXCEPT
9 INSOFAR AS IT IS SUBSUMED IN THE LARGER
10 MR. BREYER: I DON'T WISH TO ADDRESS COUNT THREE
11 UNTIL THE COURT GOES THROUGH THE PROCESS OF COMING TO A
12 CONCLUSION.
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THE COURT: IN ESSENCE, YOU MADE YOUR ARGUMENT.
MR. BREYER: I HAVE MADE MY ARGUMENT.
THE COURT: YOUR POINT IS THAT, IF EVERYTHING
16 STANDS, COUNT THREE, THE AUTHORIZED PAYMENT OF MONEY, BEFORE
17 THERE IS ANY
18
19
20 KNOVVLEDGE.
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MR. BREYER: AND, OF COURSE
THE COURT: -- CONDUCT OR I SHOULD SAY GUILTY
MR. BREYER: BUT I AM CONCERNED, OBVIOUSLY, WHERE
22 WE WROTE OUR MOTION BEFORE WE RECEIVED THE GOVERNMENT'S
23 ANTICIPATED MOTION, BUT WHEN I READ THE GOVERNMENT'S ANTICIPATED
24 MOTION LAST NIGHT, IT SEEMED TO ME NOT TO BE -- AND I'M NOT
25 ASCRIBING BAD FAITH -- VERY ACCURATE IN ITS RECITATION OF THE
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION 8-1370
1 EVENTS OF THE MARCH 1ST CONVERSATION.
2 AND ALL I WOULD DO WITH RESPECT TO THAT IS INVITE THE
3 COURT, I DON'T NEED TO ARGUE IT AT ALL. I WOULD ASK THE COURT
4 TO REREAD CERTAIN SECTIONS OF THE TESTIMONY WITH RESPECT TO
5 THAT, BECAUSE I BELIEVE IT
6 THE COURT: IN ORDER TO GET THE TIME SEQUENCE?
7 MR. BREYER: NO. IN ORDER TO FIND OUT WHAT MR.
8 SCHULTZ WAS TOLD ON MARCH 1ST BY PETER WANG, BECAUSE THEY ARE
9 USING THAT CONVERSATION TO SUPPLY THE SO-CALLED CORRUPT.
10 SEE, I MEAN, THE PROBLEM THAT THEY HAVE IS MR. SCHULTZ
1 1 WASN'T IN ANY OF THESE MEETINGS THAT HAVE BEEN TESTIFIED TO OR
12 PRIVY TO THOSE DISCUSSIONS. THERE IS NO EVIDENCE THAT HE WAS
13 UNTIL WE GET TO THE FEBRUARY 28 FAX AND THE MARCH 1ST MEETING.
14 SO IT'S EXTREMELY IMPORTANT FROM THE GOVERNMENT'S POINT OF VIEW
15 TO SHOW WHAT DID MR. SCHULTZ KNOW AS OF THE TIME HE AUTHORIZED
16 THE PAYMENT, WHICH PAYMENT WAS AUTHORIZED BEFORE THE PURPORTED
17 CONVERSATION WITH O'HARA?
18 THEY HAVE TO SHOW THAT IN THEIR CASE IN CHIEF, AND THEY
19 SHOW IT OR ATTEMPT TO SHOW IT BY RECITATION OF EVENTS ON MARCH
20 1ST, WHICH I FIND TO BE COMPLETELY INACCURATE IN TERMS OF WHAT
21 THE TRANSCRIPT SAYS.
22 SO I DON'T THINK YOU HAVE TO GET TO THAT POINT AT THIS
23 POINT IF IN FACT YOU'RE DEALING WITH A LARGER PICTURE, BUT IF
24 YOU START TO DEAL WITH THE SMALLER PIECES, THEN I WOULD
I
\
25 RESPECTFULLY REQUEST THE OPPORTUNITY TO BE HEARD ON THAT.
ROSITA FLORES. OFFICIAL COURT REPORTER. USDC
RULE 29 MOTION 8-1371
1 THE COURT: THANK YOU.
2 ~ L L , WHAT ABOUT THE GOVERNMENT'S ARGUMENT HERE THAT
3 SUPPOSE I ~ R E TO FIND NO AGREEMENT, BUT, NEVERTHELESS, COUNT
4 TWO COUNTS THREE AND FOUR COULD STAND, DO YOU WANT TO ADDRESS
5 THAT?
6 MR. CHANIN: I'D BE HAPPY TO, YOUR HONOR.
7 AND IF I MAY DO SO, I WOULD LIKE TO ADDRESS IT IN THE
8 CONTEXT OF WHETHER THE PAYMENTS, THEMSELVES, SATISFY THE LEGAL
9 REQUIREMENTS FOR AN AGREEMENT.
10 THE GOVERNMENT'S ARGUMENT, AS I UNDERSTAND IT, IS THAT
11 THE PAYMENT OF $9500 ON MARCH 8TH AND AGAIN IN MAY, ITSELF,
12 INDICATES AGREEMENT BY ASSENT, IF YOU WILL, TO A CORRUPT
13 PURPOSE, AND I THINK THERE IS NO QUESTION THAT THE PAYMENT
14 SATISFIES THE ELEMENTS THAT THERE WAS AN AGREEMENT TO PAY MONEY.
15 WHAT THE STATUTE REQUIRES IS AN AGREEMENT WITH -- FOR A CORRUPT
16 PURPOSE AND THAT BEING A SPECIFIC ACT OR DECISION OF A TELECOM
17 OFFICIAL. IF YOU GO BACK TO
18 THE COURT: READ THE CORRUPT CASES, THAT IS,
19 THE CASES YOU CITED TO ME DEFINING CORRUPT. IT SEEMS TO ME THE
20 STATEMENT WAS ESSENTIALLY CORRECT, AND WHAT THE CIRCUIT HAS SAID
21 OR AND OTHER CIRCUITS HAVE SAID IS THAT THE LANGUAGE OF CORRUPT
22 MEANS A QUID PRO QUO. I GUESS, SUPPOSE ONE CAN ARGUE WHICH
23 CAME FIRST AND WHICH CAME SECOND. I THINK QUID PRO QUO IS A
24 PART OF THE REQUIREMENT OF THE STATUTES.
25 MR. CHANIN: SO I THINK THE QUESTION IS WHETHER
ROS I TA FLORES. OFF I C I AL COlJRT RFPnRTFR IIcm,...
RULE 29 IIIIOTION 8-1372
1 THERE WAS A MEETING OF THE MINDS AS TO A QUID PRO QUO, AND IF
2 YOU GO BACK TO THE EVIDENCE PRESENTED FROM MR. O'HARA, HE SAID A
3 LOT OF DIFFERENT THINGS ABOUT WHAT HE TOLD MR. IACOBUCCI THE
4 IIIIONEY WAS FOR. HE TESTIFIED THAT IT WAS TO ARRANGE MEETINGS TO
5 INTRODUCE PEOPLE. HE ALSO TESTIFIED IN FAVOR OF THE
6 GOVERNMENT'S POSITION THAT HE SAID THE INCIDENTAL FEE IIIIONEY WAS
7 TO TAKE CARE OF TELECOM OFFICIALS. ASSUMING THAT WAS SAID, THAT
8 IS NOT ENOUGH TO ESTABLISH, IN MY OPINION, A MEETING OF THE
9 MINDS AS TO A CORRUPT QUID PRO QUO, THAT BEING A SPECIFIC ACT OR
10 DECISION OF A TELECOM OFFICIAL AND WHEN -- SO EVEN IF YOU
11 EVEN IF WE WERE TO ACCEPT THE ARGUMENT THAT A PAYMENT ON MARCH
12 8TH, WHICH INCLUDED SOME PORTION FOR INCIDENTAL FEES, WAS AGREED
13 TO, THERE HAS TO BE IIIIORE FOR A JURY TO CONCLUDE BEYOND A
14 REASONABLE DOUBT THAT SOMEBODY AT TELECOM WAS GOING TO DO SOME
15 ACT OR NOT DO SOME ACT IN THEIR OFFICIAL CAPACITY AS A RESULT OF
16 THAT IIIIONEY. I DON'T THINK THERE IS ANY EVIDENCE OF THAT AT ALL.
17 MR. IACOBUCCI AND MR. O'HARA, BACK IN JANUARY, ACCORDING
18 TO MR. O'HARA'S TESTIIIIIONY, TALKED ABOUT BID PACKAGES FOR
19 SWITCHES REQUIRING 300 TO 500 LINES. MR. O'HARA ADMITTED TO
20 SENDING A FACSIMILE TO MR. ANGULO INQUIRING ABOUT THE 300 TO 500
21 LINE BID PACKAGES. WHAT HAPPENS LATER IN TIME WHERE THERE IS
22 APPARENTLY SOME NOTION IN MR. O'HARA'S MIND THAT LEADS HIM TO
23 SAY TO MR. SCHULTZ, PERHAPS, IF WE ACCEPT IT, THAT IIIIONEY IS
24 NEEDED TO CHANGE BID SPECIFICATIONS. THAT'S WAY DOWN THE LINE.
25 THERE WAS NEVER ANY DISCUSSION LIKE THAT WITH MR. IACOBUCCI
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
RULE 29 MOTION 8-1373
1 ABOUT THE NEED TO PAY AN OFFICIAL TO DO ANYTHING, AND THE FACT
2 THAT THESE PAYMENTS ~ R E MADE THE DAY BEFORE THE STAFF PEOPLE
3 ~ R E TO GO DOWN, THOMPSON AND STEVENSON, TO COLUMBIA TO CHECK
4 OUT THE WHOLE THING, TO SEE IF THERE WAS ANY CONTRACT, IT SEEMS
5 TO ME IS SOMEWHAT OVERWHELMING THAT MR. IACOBUCCI COULD NOT HAVE
6 HAD A MEETING OF THE MINDS WITH MR. O'HARA THAT THAT MONEY WAS
7 GOING TO PAY TELECOM OFFICIALS. IT WAS JUST ALL TOO PRE MATURE.
8 SO, I DON'T THINK THAT THEY HAVE ESTABLISHED A MEETING OF THE
9 MINDS OTHER THAN TO PAY MONEY TO MR. O'HARA, NOT THE KIND OF
10 MEETING OF THE MINDS THAT WOULD BE REQUIRED FOR THIS SPECIFIC
11 STATUTE.
12
13
THE COURT: OKAY.
MR. FELDMAN: BRIEFLY.
14 ONE OF THE ELEMENTS OR EVIDENCE THAT THE GOVERNMENT
15 RELIED ON IS EXHIBIT 71, WHICH IS THIS LETTER (INDICATING),
16 SUPPOSEDLY APPOINTING INTERDELTA.
17
18
THE COURT: YES.
MR. FELDMAN: IN FACT, THE EVIDENCE IS ACTUALLY
19 IN TWO PLACES.
20 YOU HAVE 71?
21
22
THE COURT:
MR. FELDMAN:
YES.
HAVE 71. 71 IS THE ORIGINAL. IT
23 HAS INK ON IT. YOU CAN SEE BY LOOKING AT IT.
24
25
THE COURT: YOU MEAN TO SAY IT NEVER GOT SENT?
MR. FELDMAN: JOE STEVENSON TESTIFIED YESTERDAY
ROSITA FLORES, OFFICIAL COURT REPORTER. USDC
RULE 29 MOTION 8-1374
1 HE TOOK IT DOWN TO COLUMBIA.
2 THE COURT: IT WAS NEVER DELIVERED?
3 MR. FELDMAN: EXACTLY.
4 AND MR. WANG SAID IT WAS ONE OF THOSE WESTERN
5 CIVILIZATION BITS THAT MAYBE I OVERDID THAT MR. WANG TESTIFIED
6 THAT HE THOUGHT IT WAS MAILED.
7 NOTED FOR THE RECORD THAT HE HAD A COpy IN FRONT OF
8 HIM, AND JOE STEVENSON TESTIFIED YESTERDAY THAT HE CARRIED IT
9 DOWN, AND HERE IT IS (INDICATING). IT NEVER GOT DELIVERED.
10 INTERDELTA NEVER GOT APPOINTED.
11 SO WHEN THE GOVERNMENT TELLS YOU THAT INTERDELTA WAS
12 APPOINTED PURSUANT TO EXHIBIT 71, THEY ARE FLAT WRONG. HERE IT
13 IS.
14 SECOND, WITH RESPECT TO EXHIBIT 52, HOW WE CAN TALK ABOUT
15 AN AGREEMENT IN THIS CASE, I HAVE ABSOLUTELY NO IDEA. THIS
16 EXHIBIT 52, YOU RECALL, WAS DRAFTED BY O'HARA, NEVER SENT, BUT
17 REFLECTED WHAT HE THOUGHT WAS HAPPENING AND THIS, JUDGE, IS WITH
18 RESPECT TO THE DRAFT AGREEMENT.
19 THE NEXT PAGE OF THE EXHIBIT IS THE AGREEMENT LABELED
20 ~ D R A F T ~ AND O'HARA SAYS IN IT, IN THE SECOND FULL PARAGRAPH,
21 LAST SENTENCE, "PLAINLY NOT IN MY INTEREST TO AGREE TO SUCH AN
22 AGREEMENT. " DON'T KNOW HOW --
23 THE COURT: WHERE ARE YOU?
I
24 MR. FELDMAN: I'M IN EXHIBIT 52. EXHIBIT 52,
\ .
25 FIRST PAGE IS A LETTER.
ROSITA FLORES. OFFICIAL COURT REPORTER, USDC
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RULE 29 MOTION 8-1375
THE COURT: I'M SORRY. OKAY.
MR. FELDMAN: FIRST PAGE IS A LETTER TO
IACOBUCCI. THE ENCLOSURE IN THE EXHIBIT -- I BEG YOUR PARDON --
IS A DRAFT CONSULTANT AGREEMENT, AND WITH RESPECT TO THE DRAFT
CONSULTANT AGREEMENT, O'HARA SAYS, IN THE LETTER, WHICH IS THE
FIRST PAGE, IN THE SECOND FULL PARAGRAPH LAST SENTENCE, "PLAINLY
NOT IN MY INTEREST TO AGREE TO SUCH AN AGREEMENT."
~ HAD A LITTLE BIT OF, THINK, LEWIS CARROL AND TOLKIEN
HERE, BUT I DON'T SEE H O W ~ CAN BE TALKING ABOUT AN AGREEMENT
HERE WHEN SOMEBODY SAYS" ITO,S NOT IN OUR INTEREST TO AGREE TO
SUCH AN AGREEMENT AND HE'S THE SUPPOSED CONSPIRATOR.
IN THE MELCHIOR LOPEZ CASE, WHICH WE DO CITE, IT IS THE
CASE THAT EVIDENTUARY STANDARDS FOR PROVING A CONSPIRACY ARE
MORAL ACTS, AND WITH RESPECT TO PROVING A CONTRACT, THAT HAS
NOTHING TO DO WITH WHAT IS REQUIRED TO BE PROVEN. THAT'S
ONLY --
THE COURT: WHAT WAS THE CONSPIRACY ABOUT?
MR. FELDMAN: AND WHAT MUST BE PROVEN AND IN A
CONTRACT CASE, AS YOU KNOW, THERE ARE ALL SORTS OF WAYS THAT A
CONTRACT MAY BE ESTABLISHED THAT DON'T REQUIRE ACTUALLY HAVING A
MEETING OF THE MINDS, BUT THAT IS THE ESSENCE, THE CRITICAL
REQUIREMENT FOR A CONSPIRACY. SO WHILE THERE IS DEFINITE
LANGUAGE, IT'S NOT A SURPRISE THAT CONTRACTS MAY BE FORMED IN
ALL SORTS OF WAYS AND ALL SORTS OF EVIDENCE MAY BE CONSIDERED
WITH RESPECT TO THAT.
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 IVIOTION 8-1376
1 TO SUGGEST THAT THERE CAN BE A CRIMINAL CONSPIRACY PROVEN
2 BASED ON A L ~ R STANDARD THAN ONE MAY FIND IN A CIVIL CONTRACT
3
4
CASE, THINK, IS COMPLETELY INACCURATE.
THE COURT: I'M SORRY. WHERE IS THE CITATION TO
5 THAT CASE YOU ARE TALKING ABOUT?
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MR. FELDMAN: MELCHIOR LOPEZ, SIX 27 F2ND.
KNOW THE CITE.
MR. MAC KAY: 886, JUDGE, 627 F2ND.
THE COURT: WHAT'S THE CITE?
MR. MAC KAY: 886.
MR. FELDMAN: V'AJULD YOU LIKE A COPY, YOUR HONOR?
THE COURT: MIGHT AS WELL.
WHILE WE ARE HANDING THINGS UP, MR. BREYER, COULD I
HAVE A COpy OF MR. WIDEN'S TESTIIVIONY? DON'T BELIEVE I HAVE A
15 COpy OF THAT YET.
16 (THE COURT WAS HANDED DOCUMENTS).
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18
THE COURT: YOU CAN GIVE ME THE PAGE CITES.
MR. FELDMAN: I'M NOT SURE IF I AM UP TO THE
19 THIRD OR FOURTH POINT.
20 THE COURT: YOU COMPLETED THE THIRD. YOU'RE ABOUT
21 TO GO INTO THE FOURTH.
22 MR. FELDMAN: WITH RESPECT TO THE FOURTH POINT
23 THEN, AT PAGE 2-204 OF MR. WANG'S CROSS-EXAMINATION, HE WAS
24 ASKED WHAT SCHULTZ SAID TO HIM ON MARCH 1ST.
25 WHAT WANG SAID SCHULTZ SAID WAS THAT THERE V'AJULD BE A
RULE 29 MOTION 8-1377
1 COLUMBIAN COMPANY WITH ITS OWN CONNECTIONS TO THE COLUMBIA
2 GOVERNMENT WHICH WAS POSITIONED AS THE MIDDLE MAN IN THE DEAL.
3 THAT'S NOT CORRUPT. THERE IS NO DISCUSSION OF CONTRACTS. THERE
4 IS NO DISCUSSION OF INFLUENCE. THERE IS NO DISCUSSION OF AN ACT
5 OR DECISION. SO I MUST CONFESS I'M A LITTLE BIT PUZZLED ABOUT
6 WHAT THE PURPOSE OF THE REFERENCE IS AS TO MARCH 4TH BUT
7
8
THE COURT:
MR. FELDMAN:
MARCH 1ST.
MARCH 1ST. BUT WHATEVER THE
9 PURPOSE IS, WHAT WANG SAYS AT PAGE 2-204 THAT SCHULTZ SAID
10 SOMETHING ABOUT A COLUMBIAN COMPANY WITH ITS OWN CONNECTIONS TO
11 THE COLUMBIAN GOVERNMENT, WHICH WAS POSITIONED AS A MIDDLE MAN
12 IN THE DEAL, HAS NOTHING TO DO WITH CONTRACTS, ACTS OR
13 DECISIONS, CORRUPT PAYMENTS.
14 WITH RESPECT TO COUNTS TWO AND THREE, THOSE PAYMENTS
15 WERE -- THOSE ACTS WERE UNDERTAKEN BEFORE ANY ALLEGED
16 CONVERSATIONS ABOUT IMPROPRIETIES. SO YOU HAVE TO HAVE A
17 CONJUNCTION OF THE ACTUS REUS AND THE INTENT. IT DOESN'T EXIST.
18 WITH RESPECT TO COUNT FOUR, THERE IS SIMPLY, AND I STILL
19 REMAIN TOTALLY CONFUSED ABOUT HOW ANYBODY CAN SAY THAT THERE
20 COULD BE A CORRUPT PAYMENT ABOUT A CONTRACT WHICH, BY THEN, WE
21 WERE POSITIVE DIDN'T EXIST. IT IS IMPOSSIBLE TO SAY THAT YOU
22 CAN REIMBURSE SOMEBODY FOR A BRIBE PAID IN CONNECTION WITH A
23 CONTRACT THAT YOU DIDN'T EVEN CARE ABOUT, THAT DIDN'T EVEN
24 EXIST. IT'S NOT. IT IS ABSOLUTELY ILLOGICAL. THERE IS NO
25 CONTRACT THAT WE WERE INTERESTED IN, SO THERE WAS NOTHING TO
ROSITA FLORES. OFFICIAL COURT REPORTFR " ~ n ~
RULE 29 MOTION 8-1378
1 HAVE PAID A BRIBE ABOUT. PERHAPS, THAT'S THE BEST WAY OF SAYING
2 IT. THERE WAS NOTHING TO HAVE PAID A BRIBE ABOUT. IMPOSSIBLE
3 TO HAVE PAID A BRIBE BECAUSE THERE WAS NOTHING TO HAVE PAID A
4 BRIBE ABOUT. WE KNEW, WE HAD TO HAVE KNOWN THAT ON MAY 1ST.
5 IT'S -- I AM NOT ONE WHO WILL SAY TO YOU --
6 THE COURT: YOU HAVE TO KNOW ON MAY 1ST, BECAUSE BY
7 THEN THE COMPANY FORMED ITS INTENT, SHALL WE SAY, NOT TO ENGAGE
8 IN ANY FURTHER DEALS OR GOVERNMENT DEALS, TELECOM DEALS.
9 MR. FELDMAN: BUT IT'S EVEN STRONGER THAN THAT,
10 YOUR HONOR.
1 1 THE COURT: JUST DON'T THINK SOMETHING'S WRONG
12 WITH SAYING, IF A AND B HAD AGREED IN JANUARY OR MARCH TO PAY
13 BRIBE MONEY, THAT IN MAY, ONE PARTY CAN PAY THE OTHER SOME OF
14 THAT BRIBE MONEY TO BE USED, AS LONG AS IT'S EITHER
15 REIMBURSEMENT FOR MONEY THAT WAS PAID PREVIOUSLY OR IN
16 CONTEMPLATION WITH FURTHER DEAL? SO WE HAVE TO GO OUTSIDE AND
17 SAY, WELL, WHY IS THIS NOT COMTEMPLATION FOR A FURTHER DEAL?
18 REASON: BECAUSE YOUR PEOPLE AT TELECOM DECIDED THERE WAS NO
19 DEAL TO BE DONE.
20 MR. FELDMAN: YES. I THINK THERE IS ACTUALLY A
21 QUESTION ABOUT WHETHER REIMBURSEMENT WOULD CONSTITUTE AN
22 OFFENSE.
23 BUT SETTING THAT ASIDE, BECAUSE I THINK THAT I UNDERSTAND
24 YOUR POSITION, THIS IS A VERY UNUSUAL SITUATION. THIS IS A
25 SITUATION IN WHICH THERE IS NO DISPUTE THAT WE KNEW THAT THERE
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RULE 29 MOTION 8-1379
WAS NO CONTRACT ON MAY 1ST. THAT IS, I UNDERSTAND YOUR MOTION
THAT IF THERE WERE AN AGREEMENT AND THERE WERE A CONTRACT IN
MARCH AND APRIL, THAT WE COULD REIMBURSE ON MAY 1ST. BUT THAT'S
NOT WHAT HAPPENED. THERE IS NO DISPUTE IT IS AN UNUSUAL
SITUATION UNDER RULE 29. THERE IS NO DISPUTE AT ALL THAT WE
WERE NOT PURSUING TELECOM CONTRACTS AND NEVER DID. THERE WAS NO
CONTRACT WHEN WE GOT DOWN THERE THAT WE WERE INTERESTED IN. SO
THERE WAS NOTHING TO HAVE BRIBED ANYONE ABOUT.
THE COURT: WAIT A MINUTE. WAIT A MINUTE. WHAT
ABOUT O'HARA'S TESTIMONY THAT THEY WERE STILL INTERESTED IN THE
OTHER TELEPHONE COMPANIES, COMMERCIAL DEALS?
NOW, I BELIEVE I HAVE SAID THAT BECAUSE OF THE
GOVERNMENT'S INDICTMENT AND THE BILL OF PARTICULARS WERE LIMITED
TO TELECOM, IS IT REALLY THAT CLEAR THAT YOU WERE NOT INTERESTED
IN ANYTHING FURTHER THAN TELECOM?
MR. FELDMAN: ABSOLUTELY. AND EVEN IF WE WERE,
AND I COULD ADDRESS IT, BUT I SHOULDN'T HAVE TO, BECAUSE YOU
HAVE ALL THE BILL OF PARTICULARS, BUT I WANT TO BE VERY CLEAR
ABOUT THIS PAYMENT AND THAT'S WHY WE WENT THROUGH SUCH PAINS
BEFORE AND DURING THE TRIAL, BECAUSE ONCE WE KNOW THAT THERE WAS
NO CONTRACT IN WHICH WE WERE INTERESTED IN, THEN IT IS
INCONCEIVABLE THAT WE WOULD HAVE BRIBED ANYBODY. WHAT WERE WE
TO HAVE BRIBED ANYBODY ABOUT? THERE IS NOTHING. THERE IS
ABSOLUTELY NOTHING.
THE COURT: THAT'S WHY I FIND THE MAY 1ST PAYMENT
ROSITA FLORES, OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION 8-1380
1 JUST KIND OF A LINGERING QUESTION IN ALL OF THIS.
2 MR. FELDMAN: BUT IT'S NOT A LINGERING QUESTION,
3 JUDGE. IT'S NOT, AT LEAST, NOT FROM ME.
4 THE COURT: WHY WERE THEY PAYING MONEY AT ALL TO
5 ANYBODY?
6 MR. FELDMAN: BECAUSE THEY SENT THIS GUY DOWN
7 THERE TO SEE IF THERE WAS AN OPPORTUNITY, AND THEN THEY HAVE HIM
8 LOOKING FOR A DISTRIBUTOR.
9 THE COURT: GUESS THAT'S THE SIMPLEST WAY FOR
10 THE DEFENSE SIDE.
MR. FELDMAN: IF I COULD SAY ONE FINAL THING. 1 1
12 COULDN'T AGREE WITH YOU MORE, AND KNOW WE'RE NOT SUPPOSED TO
13 SAY WE AGREE WITH YOU THIS MORNING, BUT I COULDN'T AGREE WITH
14 YOU MORE THAN WHAT HAS HAPPENED, AND I MEANT NO DISRESPECT OR
15 CRITICISM OF THESE PEOPLE, EITHER.
16 WHAT HAS HAPPENED IS WANG TOOK A VERY BRIEF SNAPSHOT OF
17 THIS TRANSACTION, GAVE IT TO THE GOVERNMENT, AND THAT'S WHAT'S
18 BEEN PURSUED.
19 I DON'T MEAN ANY CRITICISM OF ANYBODY AT ALL, BUT THAT'S
20 ABSOLUTELY NOT WHAT HAPPENED HERE.
21 REPRESENT A COMPANY THAT ENTERED INTO A DEAL WITH
22 SOMEBODY TO SEEK A DISTRIBUTOR, AND THAT IS WHAT HAPPENED. SO
23 WE ARE FACED WITH MUCH MORE TESTIMONY AND A GREAT DEAL MORE TIME
24 AND EXPENSE FOR SOMETHING THAT EVERYBODY IN THIS ROOM KNOWS
25 DIDN'T HAPPEN.
ROSITA FLORES. OFFICIAL COURT REPORTER, USDC
RULE 29 MOTION
8-1381
1 MR. MAC KAY:
THE GOVERNMENT DOESN'T TAKE THAT
2 POSITION, YOUR HONOR.
3
MR. FELDMAN:
AND I DON'T THINK THAT THAT'S WHAT
4 ~ SHOULD HAVE TO DO.
5 THE COURT: OKAY.
6 ALL RIGHT.
7 I'M GOING TO SUBMIT THE MOTIONS, AND I'M GOING TO TAKE
8 ABOUT AN HOUR TO GO OVER THE MATTERS YOU'VE RAISED AND COMPLETE
9 MY ATTEMPT TO EXAMINE THIS COUNT FIVE STATUTE.
10 SO, WILL YOU BE AVAILABLE ABOUT QUARTER TO 11, PLEASE?
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JURY)
RULING ON RULE 29 MOTIONS 8-1382
(PROCEEDINGS RESUMING AFTER RECESS AT 10:53 A.M.)
(FOLLOWING PROCEEDINGS OUTSIDE THE PRESENCE OF THE
THE COURT: BE SEATED, PLEASE.
ALL RIGHT. WE ARE HERE FOR RULING ON THE RULE 29
MOTIONS FOR ACQUITTAL THAT HAVE BEEN MADE BY THE DEFENDANTS.
I 'M NOT GOING TO REPEAT MY COMMENTS, AND OBSERVATIONS,
AND RESPONSES TO QUESTIONS, AND ••• MY OWN QUESTIONS THAT I HAVE
MADE EARLIER ON THE RECORD TODAY.
I THINK IT IS IMPORTANT, HOWEVER, THAT WE HAVE TO KEEP
OUR EYE ON THE STANDARD OF A RULE 29 MOTION; AND, THAT IS, I
HAVE TO TAKE THE EVIDENCE MOST FAVORABLE TO THE GOVERNMENT, DRAW
ALL INFERENCES FAVORABLE TO THE GOVERNMENT, AND THEN DETERMINE
WHETHER THERE IS SUFFICIENT EVIDENCE ON THAT STANDARD FOR A
REASONABLE JURY TO FIND THE DEFENDANTS GUILTY OF ONE OR MORE
COUNTS BEYOND A REASONABLE DOUBT.
I'VE GONE OVER ALL THAT MATERIAL. AND I FIND THAT
THERE IS NOT SUFFICIENT EVIDENCE ON THAT STANDARD WHEREIN A
REASONABLE JURY COULD CONCLUDE THAT THERE WAS AN AGREEMENT
BETWEEN HARRIS CORPORATION, MR. IACOBUCCI, OR MR. SCHULTZ ON THE
ONE HAND, AND O'HARA ON THE OTHER HAND, TO DO SOMETHING
PROHIBITED BY SECTION 78DD-l(A) (3).
I DON'T BELIEVE THAT ANY REASONABLE JURY COULD FIND
SUCH AN AGREEMENT -- THAT THOSE PARTIES CAME TO SUCH AN
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULING ON RULE 29 MOTIONS 8-1383
1 AGREEMENT BY A STANDARD OF BEYOND A REASONABLE DOUBT.
2 THEREFORE, I AM DIRECTING A VERDICT ON BEHALF OF THE
3 DEFENDANTS ON COUNT ONE.
4 AS TO COUNTS TWO, THREE, AND FOUR, THE STATUTE
5 REQUIRES THE FOLLOWING MENTAL ELEMENTS.
6 ONE IS CORRUPT; ANOTHER IS KNOWING; AND SECTION 78FF,
7 I BELIEVE, ADDS THE ELEMENT OF WILLFUL. AND IN ASSESSING THE
8 STANDARD OF KNOWING, I HAVE USED THE DEFINITION AS PROVIDED IN
9 SECTION (F) (2) OF THE 78DD-l STATUTE.
10 SINCE NO AGREEMENT WAS REACHED, AS I'VE ALREADY
11 STATED, I DO NOT BELIEVE THAT ANY REASONABLE JURY COULD FIND
12 THOSE NECESSARY MENTAL ELEMENTS FOR A VIOLATION OF COUNTS TWO,
13 THREE, AND FOUR.
14 IF THERE WAS NO AGREEMENT TO DO SOMETHING IMPROPER,
15 THEN NO CONDUCT ALLEGEDLY IN FURTHERANCE OF THAT AGREEMENT COULD
16 BE CORRUPT OR KNOWING OR WILLFUL.
17 AS TO COUNT FIVE ••• I CAN FIND NO CASE LAW THAT'S VERY
18 HELPFUL, IF ANY CASE LAW AT ALL, ON COUNT FIVE. THE STATUTORY
19 DEFINITION OF THE MENTAL STATE REQUIREMENT IS SECTION 78M(B) (5).
20 THAT REQUIRES KNOWING FALSIFICATION. AND SECTION 78FF AGAIN
21 ADDS THE ELEMENTS OF WILLFUL AND KNOWING.
22 AGAIN, SINCE NO AGREEMENT WAS REACHED BETWEEN HARRIS,
23 IACOBUCCI, AND SCHULTZ ON THE ONE HAND, AND O'HARA ON THE OTHER,
24 I DO NOT BELIEVE THAT THERE IS ANY REASONABLE BASIS FOR A JURY
25 TO FIND THAT THE ELEMENTS OF KNOWING FALSIFICATION, WILLFULNESS,
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
RULING ON RULE 29 MOTIONS 8-1384
1 OR KNOWINGLY HAVE BEEN SATISFIED.
2 STATED MORE SIMPLY, IF THERE WAS NEVER AN AGREEMENT TO
3 DO ANYTHING IMPROPER, THERE REALLY CAN'T BE A VIOLATION OF THE
4 SECTION IN HOW THE TRANSACTION WAS RECORDED ON THE BOOKS.
5 I'M, THEREFORE, ORDERING THAT THE MOTION FOR ACQUITTAL
6 FOR ALL DEFENDANTS AND ON ALL COUNTS WILL BE GRANTED.
7 JUST FOR THE REASONS I'VE ALREADY STATED THIS MORNING,
8 BOTH EARLIER ON THE RECORD AND NOW, I JUST DON'T THINK THERE'S
9 ENOUGH EVIDENCE TO GET TO A JURY IN A CRIMINAL CASE.
10 I DO NOT IN ANY WAY FAULT THE GOVERNMENT OR THE
11 ATTORNEYS HERE; THE U.S. ATTORNEYS, OR THE FBI. THEY DID THEIR
12 ABSOLUTE BEST WITH WHAT WAS AVAILABLE TO THEM.
13 THEY WERE OBLIGATED TO, OF COURSE, PURSUE INFORMATION
14 BROUGHT TO THEM BY WANG AND BY O'HARA. AND, HAVING FELT A CRIME
15 WAS COMMITTED, TO ASK A GRAND JURY FOR AN INDICTMENT.
16 SO I DON'T FAULT THEM AT ALL. THEY WERE DOING WHAT
17 THEY'RE OBLIGATED TO DO. BUT I JUST DON'T BELIEVE THAT THE
18 EVIDENCE IS SUFFICIENT TO CARRY A CRIMINAL CASE.
19 AS TO THE DEFENDANTS, THE DEFENDANTS GOT CLOSE. THIS
20 IS NOT AN EASY DECISION WHICH I'M MAKING, AND IT'S IN MANY WAYS
21 A DIFFICULT ONE AND A CLOSE ONE.
22 THE DEFENDANTS GOT VERY CLOSE TO SERIOUS TROUBLE. I'M
23 SURE AS FAR AS THEIR FUTURE CONDUCT IS CONCERNED THAT HAVING
24 BEEN THROUGH THIS EXPERIENCE WILL BE ENOUGH TO DETER MR.
25 IACOBUCCI AND MR. SCHULTZ, AND I DARE SAY ANY OTHER HARRIS
CARL R. PLINE OFFICIAL COURT REPORTER
U. s. DISTRTr:T rOllDT
8-1385
1 COMPANY OFFICER, FROM GETTING CLOSE TO SUCH AN EVENT AGAIN.
2 I HOPE THAT THIS PROSECUTION HAS SOME GENERAL
3 DETERRENCE VALUE; THAT IS, DETERRENCE ABOVE AND BEYOND THE
4 PARTIES IN THIS CASE -- THINKING OF THE PUBLIC GENERALLY -- TO
5 KNOW THAT THE GOVERNMENT DOES, AND I 'M SURE WILL, BRING SUCH
2
6 CASES WHERE THEY BELIEVE THE EVIDENCE JUSTIFIES IT. AND IF
7 INDICTED THE POTENTIAL DEFENDANTS ARE AT LEAST FACING THE
8 PROSPECT OF A SERIOUS CRIME.
9 SO I HOPE THAT EVEN THOUGH THIS PROSECUTION HAS
10 RESULTED IN A JUDGMENT OF ACQUITTAL THAT THE MERE BRINGING OF
11 THE ACTION, AND THE TRIAL OF THE ACTION WILL HAVE SOME GENERAL
12 DETERRENCE VALUE ON OTHER COMPANIES.
13 AS TO MR. O'HARA, I'M SUGGESTING -- OR REQUESTING, I
14 GUESS I SHOULD SAY, THAT THE PARTIES ADVISE MR. O'HARA'S
15 ATTORNEY, IF HE HAS ONE, OR THE JUDGE IN NEW YORK IF HE DOES NOT
16 HAVE AN ATTORNEY, THAT AFTER TRIAL IN THIS CASE I HAVE FOUND
17 THAT THERE WAS NO CONSPIRACY BETWEEN MR. O'HARA AND CONGRESSMAN
18 LOPEZ BY A PREPONDERANCE OF THE EVIDENCE; AND HAVE FOUND THAT
19 THERE WAS NO ••• CONSPIRACY BETWEEN O'HARA ON THE ONE HAND, AND
20 HARRIS CORPORATION, IACOBUCCI, AND SCHULTZ ON THE OTHER, ON A
21 STANDARD OF RULE 29.
22 I DON'T KNOW WHAT EFFECT THIS MAY HAVE, IF ANY, ON MR.
23 O'HARA'S PENDING PROCEEDINGS. BUT I THINK THAT AT LEAST HIS
24 ATTORNEY OUGHT TO KNOW THE CONSEQUENCES OF THAT.
25 SO I'M GOING TO BRING IN THE JURY, HERE, AND ADVISE
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
8-1386
1 THEM THAT I HAVE ARRIVED AT THIS DECISION. I 'M NOT GOING TO
2 ELABORATE FOR THEM ON WHY.
3 I WILL THEN DISCHARGE THE JURY, AND THEN BOTH SIDES
4 ARE FREE, IF THE JURY WISHES, TO SPEAK WITH YOU.
5 BUT I WOULD ASK THAT YOU REMAIN WHERE YOU ARE, WITH NO
6 PUBLIC DEMONSTRATION, UNTIL THE JURY IS DISCHARGED.
7 MR. SANTOS, WILL YOU BRING THE JURY IN?
8 THE CLERK: YES, JUDGE.
9 (JURY ENTERING COURTROOM AT 11:05 A.M.)
THE COURT: ALL RIGHT.
LET THE RECORD SHOW THE JURORS ARE ALL PRESENT.
GOOD MORNING, LADIES AND GENTLEMEN.
10
11
12
13 I HAVE SOME NEWS FOR YOU TODAY THAT SOME OF YOU MAY
14 VIEW AS GOOD NEWS, SOME OF YOU MAY VIEW AS BAD NEWS. I'LL GIVE
15 YOU THE BOTTOM LINE, AND THEN I'LL BACK UP FROM THERE.
16 THE BOTTOM LINE IS THAT THE CASE IS CONCLUDED.
17 OKAY. NOW, WHY?
18 THE PROCEDURE IS THAT ONCE THE GOVERNMENT RESTS, IT'S
19 THEN MY OBLIGATION TO ANALYZE THE EVIDENCE IN THE CASE, AND TO
20 ANALYZE THE LAW IN THE CASE, TO DETERMINE WHETHER THERE IS A
21 SUFFICIENT LEGAL AND EVIDENTIARY BASIS FOR YOU TO BE MAKING A
22 DECISION.
23 AFTER WORKING AT THAT PROCESS LAST NIGHT AND MOST ALL
24 OF THIS MORNING, AND HEARING FROM LAWYERS FROM BOTH SIDES, I
25 HAVE CONCLUDED THAT THERE IS NOT A SUFFICIENT EVIDENTIARY AND
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
8-1387
1 LEGAL BASIS FOR THE CASE TO BE SUBMITTED TO YOU FOR A DECISION;
2 AND THAT THE ••• DEFENDANTS SHOULD BE ACQUITTED.
3 SO WE DO NOT NEED YOU TO PARTICIPATE FURTHER. THAT'S
4 GOOD NEWS FOR YOU, I'M SURE, TO KNOW THAT YOUR TIME IS NOW FREE.
5 PERHAPS IT MAY BE UNSATISFACTORY NEWS, BECAUSE YOU
6 HAVE DEVOTED, I KNOW, A GREAT DEAL OF PERSONAL ENERGY AND
7 ATTENTION TO THIS CASE. AND IT MAY BE SOMEWHAT UNSATISFACTORY
8 TO GET YOU TO THIS POINT AND THEN TELL YOU THAT YOU DON'T NEED
9 TO DECIDE IT.
10 I'M SORRY FOR THAT, BUT THAT'S THE WAY OUR SYSTEM
il PROCEEDS. IT'S PART OF THE DIVISION OF RESPONSIBILITIES BETWEEN
12 THE JURY AND THE JUDGE THAT I TOLD YOU ABOUT DURING THE FIRST
13 DAYS OF THE TRIAL.
14 I'M NOT GOING TO ELABORATE WITH YOU ON THE REASONS FOR
15 MY DECISION. SOME OF THEM -- MOST OF THEM GET SO CLOSE TO THE
16 LAW YOU WOULD PROBABLY FIND THEM A LITTLE DULL ANYWAY.
17 BUT THAT'S THE BOTTOM LINE OF THE DECISION.
18 THE JUDGMENT OF ACQUITTAL IS GOING TO BE ENTERED FOR
19 ALL THREE DEFENDANTS; THE CORPORATION, MR. IACOBUCCI, AND MR.
20 SCHULTZ.
21 I WANT TO EMPHASIZE THAT IN MAKING THIS DECISION I IN
,
22 NO WAY FAULT THE GOVERNMENT, OR THE U.S. ATTORNEYS, OR THE FBI.
23 BASED UPON THE INFORMATION PRESENTED TO THEM BY MR.
24 WANG AND BY MR. O'HARA, THEY CERTAINLY HAD AN OBLIGATION TO ALL
25 OF US TO PURSUE THE INVESTIGATION, AND TO PURSUE AN
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
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AND TO PROSECUTE THE CASE.
AND THE FACT THAT THE EVIDENCE HAS TURNED -- IN
BALANCE WITH THE LAW HAS TURNED OUT TO BE INSUFFICIENT IS
CERTAINLY NO RECOGNITION OF THE LACK OF ZEAL, OR THE LACK OF
COMPETENCE ON THE GOVERNMENT'S PART.
INDEED THE GOVERNMENT HAS DONE THE ABSOLUTE BEST IT
COULD WITH THE AMMUNITION, SHALL I SAY, THAT IT HAD TO WORK
WITH. BUT I'VE DETERMINED AS A MATTER OF LAW IT'S JUST NOT
SUFFICIENT.
SO YOU ARE DISCHARGED AT THIS TIME.
YOU CAN GO TO THE JURY ROOM WITH MR. SANTOS, AND GIVE
HIM YOUR JUROR'S BADGES, AND GET YOUR THINGS.
AND THEN AT THAT TIME YOU ARE FREE TO TALK WITH ANY OF
THE PARTICIPANTS IN THE CASE TO WHOM YOU MIGHT WISH TO TALK
WITH.
IF YOU DON'T WANT TO TALK WITH ANYBODY, YOU DON'T HAVE
TO. YOU CAN JUST GO ON ABOUT YOUR BUSINESS AND GO HOME.
IF YOU DO WISH TO TALK WITH ANY OF THE PARTICIPANTS,
THEY WILL WAIT FOR YOU HERE IN THE COURTROOM, AND I KNOW WILL BE
HAPPY TO SHARE SOME THOUGHTS WITH YOU.
SO ON BEHALF OF THE COURT AND ALL OF US HERE, I AGAIN
APOLOGIZE FOR YOUR HAVING -- FOR HAVING TO TAKE THIS AWAY FROM
YOU, AND NOT LET YOU DECIDE THIS AFTER THE PERIOD OF TIME YOU
SAT THROUGH IT.
I DO APPRECIATE YOUR DILIGENCE. AND THANK YOU VERY
CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
8-1389
1 MUCH FOR YOUR PARTICIPATION.
2 THANK YOU.
3 ALL RIGHT.
4 COURT IS ADJOURNED.
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6 (PROCEEDINGS CONCLUDED AT 11:09 A.M.)
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CARL R. PLINE OFFICIAL COURT REPORTER U. S. DISTRICT COURT
CERTIFICATE OF REPORTER
I, WE, THE UNDERSIGNED OFFICIAL REPORTERS OF THE
UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
CALI FORN I A, 450 GOl DEN GATE AVENUE, SAN FRANC I SCO, CALI FORN I A,
DO HEREBY CERTIFY:
THAT THE FOREGOING TRANSCRIPT, PAGES NUMBERED 1
THROUGH
1389 INCLUSIVE, CONSTITUTES A TRUE, FUll AND
CORRECT TRANSCRIPT OF MY, OUR, SHORTHAND NOTES TAKEN AS SUCH
OFFICIAL REPORTER TO THE PROCEEDINGS HEREINBEFORE ENTITLED
AND REDUCED TO TRANSCRIPTION TO THE BEST OF MY, OUR, ABILITY.
ROS I TA FlO!Ekl.

CARL R. PLI NE