Day 11 Closes On Tyco Jury
Jurors in the Tyco International corporate looting trial finished an 11th day of deliberations without a verdict Thursday after asking to review exhibits related to comments made by the two defendants.
The jury, which will resume its talks Friday morning, asked for exhibits relating to statements from former Tyco CEO L. Dennis Kozlowski and co-defendant Mark Swartz, the former chief financial officer, about their stock sales and company loans.
The request could indicate that the jury is focused on the securities fraud charge against the two. They are accused of falsely pumping up Tyco's stock price with their comments to investors, then profiting by selling shares.
After a $20 million payment to Frank Walsh, a Tyco board member, became public and Tyco stock began falling in 2002, Kozlowski tried to soothe edgy investors with phone calls and positive press releases.
The jurors resumed deliberations after state Supreme Court Justice Michael Obus delivered a 45-minute explanation on the counts of securities fraud and conspiracy to commit grand larceny and criminal possession of stolen property.
Before ending deliberations Thursday, the jurors requested exhibits related to a Tyco account set up for Kozlowski's short-term borrowing needs. Kozlowski lawyer Stephen Kaufman has said the account was for personal spending and that his client reimbursed it regularly.
The jurors were to see the exhibits Friday.
Kozlowski, 57, whose $6,000 shower curtain and $2 million toga party made him a symbol of corporate excess, is accused with Swartz, 43, of looting the company of $600 million.
They are charged with 32 counts of grand larceny, falsifying business records, conspiracy and violating state business laws. Each could face up to 30 years in prison if convicted. The two allegedly took unauthorized bonuses and abused company loan programs and used the money to finance lavish lifestyles
The defense says all money and benefits the defendants received was known to internal and external auditors and approved by members of Tyco's board of directors.
On Wednesday, the judge announced that during the day he had denied the defense's latest mistrial motion and sealed the record of the discussion in chambers about it.
The motion was made Tuesday by Charles Stillman, lead lawyer for Swartz's defense team, who had referred to "venomous" attacks on juror No. 4 in Internet chat rooms.
Some reporters speculated that juror No. 4 was the panelist who brought deliberations to a halt after deciding that the prosecution had not proved its case.
One note last week described the jury room atmosphere as "poisonous" and said deliberations had been "compromised." But the resumption of deliberations this week apparently marked an easing in the acrimony among the jurors.
Obus also rejected a motion for a mistrial by Kaufman, the Kozlowski lawyer. Kaufman said he was concerned that the juror, apparently holding out for acquittal, might feel coerced to abandon a genuinely held view.
Earlier Wednesday, jurors asked Obus to clarify three counts related to the prosecution's charge that Kozlowski and Swartz stole $38.5 million from the company by disguising it as loan forgiveness.
Tyco, which has about 270,000 employees and $36 billion in annual revenue, makes electronics and medical supplies and owns the ADT home security business. Its operations headquarters are in West Windsor, N.J., but the company is based in Bermuda.
"If the defendants were optimistic late last week and early this week that they might get a mistrial they ought to be fairly pessimistic now that the jury is back deliberating again on the substance of the case," says CBSNews.com Legal Analyst Andrew Cohen. "That doesn't necessarily mean we'll see convictions here but it's not a good sign for Kozlowski and Swartz."