The Los Angeles County Bar Blog

Murray verdict reached

According to news sources, the jury in the trial of Dr. Conrad Murray has reached a verdict of involuntary manslaughter.

Liveblogging the Jackson trial

Michael Jackson fans blog the trial on his behalf, attacking a possible defense argument on rapid detox. A live blog of the trial follows the testimony of Dr. Paul White, a witness for the defense. According to a reuters story, Dr. White, an anesthesiologist, has doubts about the corner's determination that propofol killed Michael Jackson, "I was somewhat perplexed at how a determination has been made that Dr. Murray was infusing propofol."

Some questions jurors may be wishing they could ask

I contacted criminal defense attorney Lou Shapiro, who has a few questions about what the jury may be wanting to know.

He wrote, "Now that we are over a week into the trial of Dr. Murray, we are left with more questions than answers. The jurors want to know: 1. Why was medicine cleaned up before the paramedics arrived? 2. Why didn't Dr. Murray inform the paramedics or the doctors that Jackson had been given propofol? 3. Why was Dr. Murray calling his girlfriend in the ambulance? 4. Why did Dr. Murray record Michael Jackson on his phone? 5. Why was propofol being delivered to Dr. Murray's residence, rather than Jackson's residence? While Dr. Murray has the right not to testify, he is the only one who can provide answers to these questions."

Other doctors in trouble

According to LAist, "[Dr. Marc] Abrams had been under investigation in conjunction with 'his treatment of a 25-year-old patient who overdosed on prescription drugs.'" More.

And according to KTLA news, "Dr. Nazar Al Bussam, 71, was arrested in October 2010 after a three-year investigation by the Drug Enforcement Administration." The LA Times reports that the doctor has received a seven-year sentence; the doctor has been linked to the deaths of three patients.

Meanwhile, Trials and Tribulations, a trail watch blog, has been following the Dr. Murray trial with regular updates.

Remembering the trials of another king's doctor

The Guardian/Observer has an excellent summary of the story of Dr. Nick, the personal physician of Elvis Presley. According to Wikipedia, Dr. George Constantine Nichopoulos was indicted in 1980 on 14 counts of overprescribing drugs to Elvis Presley and Jerry Lee Lewis, as well as twelve other patients, and ultimately the doctor lost his license to practice medicine.

The ABA Journal has an article on how attorney James Neal successfully defended Dr. Nick before a Memphis jury.

Since his trials, Dr. Nick has spent years trying to rehabilitate his reputation, with some success.

One point of comparison between Dr. Nick and Dr. Murray: Dr. Nick tried to keep Elvis's addiction to prescription drugs in check, going so far as to "persuade Knoll, the manufacturers of Dilaudid, Elvis's favourite painkiller, to press a special batch of a thousand pills without any active ingredients. It took a year of letter-writing and legal wrangling. But they looked just like the real thing. They cost him $5.98 apiece."

The Jackson Doctor Trial: The Players

The Judge: According to a biography prepared for LACBA's Criminal Justice Section's Criminal Justice Awards Dinner of 2007, in which he was honored as Judge of the Year, Judge Michael E. Pastor "was assigned to the Criminal Courts Building [in 1985], where he handled misdemeanor trials, E.D.P. matters, and felony preliminary hearings. He was selected to become the first judge to handle 'Night Court' preliminary hearings....In 2001 Judge Pastor was assigned to handle felony jury trials in the Foltz Criminal Justice Center and remained in that assignment until 2004, when he was chosen for his present assignment in a felony 'long-cause' court....In that capacity, he has presided over a significant number of complicated and noteworthy felony trials." NBC Los Angeles has more, as does Fox.

The Prosecutor: David Walgren is with the District Attorney's Major Crimes Division. In 2008, he won the conviction of Theodore Churchill Shove for double murder. Fox has more.

The Defense: Edward M. Chernoff is a former D.A. who, according to the L.A. Times, handles "mainly white-collar cases." The article states, "J. Michael Flanagan, a veteran Glendale lawyer who is helping defend Murray, said...'[Chernoff is] going to win this case, and it's going to set up his career for the rest of his life.'"

More on the trial here and here.

Tom Mesereau Reviews the Murray Trial Teams

I had an opportunity to speak by phone with Thomas A. Mesereau, Jr., today about the trial of Dr. Conrad Murray. Mesereau, who is best known for his defense of Michael Jackson and Robert Blake in their criminal trials, stated, as he has in other interviews, that in this case he is pro-prosecution. When I asked Mr. Mesereau to speculate as to why Dr. Murray's defense counsel did not accept a plea bargain before trial, he indicated that he considers it likely that no plea deal was offered. In a case in which it is conceivable that a second-degree murder charge could have been brought, perhaps the charge of involuntary manslaughter was all the bargain that the prosecution was willing to make.

Mesereau indicated that so far, both legal teams are doing a very professional job, with opening arguments on both sides earning his praise.

Ponzi Scheme Prosecutions

In "Swindlers' List" in Los Angeles Lawyer, Alex Pilmer and I addressed many of the legal issues that arise upon the inevitable collapse of a Ponzi scheme.  Since our article appeared, there have been significant practical developments in three on-going high-profile Ponzi scheme cases.

Last Tuesday, U.S. District Court Judge David Hittner revoked the bail of accused Ponzi-schemer R. Allen Stanford in Houston, Texas.  In revoking Stanford's $500,000 bail, Judge Hittner found that Stanford was a "serious flight risk."  In contrast to Madoff's plea bargain, Stanford has vowed to defend the charges against him at a jury trial.  Trials in high-profile Ponzi schemes cases are unusual--in part because the evidence is typically overwhelming- so we will continue watching the developments in this case.

Also, Los Angeles Federal Court Judge Phillip Gutierrez extended his temporary order appointing a receiver over the operations of the PEM Group and Danny Pang, who are accused of operating a several-hundred-million-dollar Ponzi scheme.

But the big news last week was Bernard Madoff's sentencing. On June 29th, U.S. District Court Judge Denny Chin, sitting in Manhattan, sentenced Madoff to 150 years--or, as Judge Chin noted, technically 1,800 months--in federal custody for his crimes.  Given that Madoff is 71 years old, a 150-year sentence seems like overkill.  But Judge Chin took on that argument directly. Calling Madoff's fraud "staggering," he stated that "the symbolism is important....the message must be sent that Mr. Madoff's crimes were extraordinarily evil, and that this kind of irresponsible manipulation of the system is not merely a bloodless financial crime that takes place just on paper, but that it is instead...one that takes a staggering human toll.  The symbolism is important because the message must be sent that in a society governed by the rule of law, Mr. Madoff will get what he deserves, and that he will be punished according to his moral culpability."

Madoff's sentencing hearing was conducted before a packed New York courtroom.  The Court heard statements from only nine of Madoff's victims, but Judge Chin stated that he received letters from many other victims.  These victim statements appear to have been a significant contributing factor in Judge Chin's decision.  In contrast, Judge Chin noted that "in a white collar fraud case such as this, I would expect to see letters from family and friends and colleagues.  But not a single letter has been submitted attesting to Mr. Madoff's good deeds or good character or civic or charitable activities."

Victim statements can be very compelling to the sentencing judge.  For example, federal judge Margaret Morrow sentenced Reed Slatkin to 14 years in federal prison for his Ponzi scheme, even though the prosecutors argued for a sentence of only 11 1/2 years.  At the sentencing hearing, two of Slatkin's victims gave statements about the depth of the loss and the human suffering that the scam caused.  Those stories were echoed in the Madoff sentencing hearing; stories of retirements ruined, children's college funds decimated, lifetimes of hard work and savings eliminated because of greed and broken trust.

Nevertheless, some commentators have already begun to decry Madoff's 150-year sentence as bad precedent, pointing out that it creates disincentives for future accused defendants to plead guilty.  After all, the argument goes, who would plead guilty when the guilty plea results in the maximum sentence?  We think that argument misses the mark.  Ponzi schemes and similar frauds take an enormous toll on individual victims specifically and on society generally.  The personal and financial havoc that fraudsters like Madoff cause can never be fully remedied.  Heavy prison sentences serve not only as retribution for crimes like Madoff's but also serve as deterrents to future would-be Madoffs.  Although Ponzi schemes are doomed to fail from their inception (and most fail soon after they start), a number of recent high-profile schemes, including Madoff's, endured for many years and claimed thousands of victims. If heavy sentences can deter future frauds from happening in the first place, we will all be better off.

New and Old Criminal Cases

—"An FBI investigation that lead to the federal indictment of several members of MS13 details murders, drug deals, robberies and witness intimidation that even in dry legal language is quite chilling." Crime Scene. The indictment includes names and streets. Celeste Fremon of Witness LA is surprised the Alex Sanchez of Homies Unidos is among those indicted.

—The LA Weekly has a follow-up story on how the case against grocer George Torres fell apart it was revealed that taped conversations with witnesses were not made available to the defense.

Protecting Madoff Investors

It is bad enough that most of the people who invested with Madoff will lose a significant amount of their wealth. It is also possible, in fact, likely, that many of the investors who received distributions from Madoff or pulled their money out in time may have to return the money.

When the inevitable bankruptcy engulfs Bernard L. Madoff Investment Securities, the bankruptcy trustee will have the ability to require a return of previously paid distributions to share them with other victims of the Ponzi scheme.

The bankruptcy trustee's ability to seize distributions from what turned out to be a Ponzi scheme is based on the theory of a fraudulent conveyance, and may nab even those investors who were innocent victims of Madoff's scheme. This may impact even those investors who received distributions years ago.

The ability of the trustee to get at a person's assets will depend on a number of factors, including the state in which the investor lives, and whether the investor is married or single.

A lot of Madoff investors live in Florida, and their residences may be fully protected by Florida law. However, a lot of Madoff investors may be New York snowbirds who cannot claim Florida as their state of residence. For these investors and all others, the long reach of the bankruptcy trustee should be a call for immediate action.

Even in a high-profile case like this one, assets may be shielded with proper asset protection planning.