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Attorneys at Law: Judge in Peterson Case Imposes Gag Rule; Waksal Receives Sentence; Tacoma Chief Kills Estranged Wife, Self

Aired June 15, 2003 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

JEFFREY TOOBIN, CNN LEGAL ANALYST: Thanks, I'm CNN legal analyst, Jeffrey Toobin with Court TV's Catherine Crier and CNN contributor Michael Smerconish. Welcome to "Attorneys at Law."
The judge in the Scott Peterson trial slaps a gag order on all participants, but that won't stop us. We'll talk about it coming up. But first we'd like to welcome our guest, former assistant U.S. attorney, David Schertler. Welcome, David.

DAVID SCHERTLER, FORMER ASSISTANT U.S. ATTORNEY: Thank you. It's a pleasure to be here.

(CROSSTALK)

CATHERINE CRIER, COURT TV: Let's get right to the big case.

Sam Waksal becomes the first chief executive to receive jail time in the recent wave of corporate scandals. Waksal, the former CEO of ImClone, was sentenced to seven years, three months in prison for securities fraud, obstruction of justice and other charges. In addition, he must pay $4.3 million in fines.

Waksal and family members attempted to sell large blocks of company stock one day before an announcement that the Food and Drug Administration had rejected the new drug. Well, that news sent the stock plummeting. His attorney asked that Waksal serve time at a Florida minimum-security facility; the judge is leaving that decision up to the Federal Bureau of Prisons.

TOOBIN: David, you used to used to be a federal prosecutor, but then you moved over to the dark side, and now you're a criminal defense attorney. You represent a former executive at WorldCom. So let's look where we are on these corporate scandals. You have Kenneth Lay, former CEO of Enron -- no charges. Bernie Ebbers, former CEO of WorldCom -- no charges. Sam Waksal, of all people, is going away for seven years. What makes him different? Why did he get this?

SCHERTLER: Well, there is nothing different. I think what you have to consider with respect to Enron and WorldCom is that those investigations are ongoing. There's a very good likelihood that Bernie Ebbers may face charges. When you look at the WorldCom investigative reports that came out earlier this week, those reports seemed to indicate that there is evidence to show that Bernie Ebbers knew about the financial manipulation that was taking place at WorldCom. The case against Ken Lay seems to be a harder case to make, and the accounting fraud that's alleged at Enron is much more complex. Whether they're ever able to connect Ken Lay to that is a big question, but they will connect higher-management people that have not yet been indicted.

Sam Waksal just happened to be the first, I think, of a number of high-level corporate executives that were are going to see charged, either pleading guilty or going to trial, and I think what we're also seeing is that prosecutors and lawmakers are taking a very aggressive approach against corporate fraud in the wake of WorldCom and Enron.

CRIER: It's interesting, because here we have insider trading that didn't necessarily hurt the investor. This is something where they pocketed extra cash and made a little profit, but in fact, we have WorldCom and Enron where these guys have lost billions of dollars for people around the world, literally -- put people out on to the street with no retirement. These are the guys they should be focusing on.

SCHERTLER: That's absolutely right. The impact of the accounting fraud alleged in WorldCom and Enron is far greater than what Sam Waksal did. I think what you're seeing, though, is that in the wake of Enron and WorldCom, prosecutors and lawmakers want to send a very strong message to corporate America regarding any type of fraud, and I think Sam Waksal just happened to be the first in that line.

The message is that corporate executives are going to do jail time if they engage in any kind of fraud, whether it's insider trading or the kind of accounting manipulation that you see at WorldCom and Enron.

SMERCONISH: His lawyer made quite a plea for leniency, bringing up everything from the fact that his parents were Holocaust survivors to the fact that he was friendly with the janitor at the company, and it didn't wash. As a matter of fact, he pled guilty but he still got the max under the federal-sentencing guidelines. Now, if I'm the CFO of WorldCom, and I'm awaiting trial, why am I going to plead? I might as well take my chances.

SCHERTLER: I think that's what the CFO of WorldCom is thinking right now, and that's what he's up against. I think that he would like to enter into some plea agreement with the prosecutors. I don't know what the negotiations have been, but undoubtedly the prosecutors are taking a very hard line. If he enters into a plea agreement, it probably would involve a similar if not greater amount of jail time.

SMERCONISH: It defeats the purpose of a plea.

SCHERTLER: It defeats the purpose of a plea in the sense that the defendant gets a benefit of leniency from pleading, but I think at the same time the prosecutors are saying we want to send a every strong message. Whether you plead or go to trial ...

CRIER: What happened to Martha? TOOBIN: Put on your strategist's hat here for a minute. The root cause of Martha was the investigation of Sam Waksal. He got this big sentence; does this help or hurt her case? What do you think?

SCHERTLER: I don't think it has much impact on her case, as much as people would like to connect the two. With Martha Stewart, when you read the indictment, it's the classic case in white collar-crime of the cover-up being far worse than the original crime. Martha Stewart sold her stock allegedly based on some information she got from the brokers at Merrill Lynch. It was a small amount of money that was involved. I'm not sure she would have ever been charged for that crime.

TOOBIN: I disagree with you. I think this is actually quite good news for Martha Stewart, because of the dog that didn't bark here. Here was a guy who was looking at a huge amount of time, and he didn't flip, he didn't cooperate against Martha Stewart. Why? Well, it seems like he had nothing to give on her. The fact that he went through with this sentencing and didn't flip and nothing came out bad about Martha Stewart, that suggests to me that there is an important avenue of possible information about her that came up empty.

CRIER: You have to watch out, though, because by going after the obstruction of justice and not going after the insider trading, there is no nexus between his case and hers.

SCHERTLER: That's right. There is no allegation that Sam Waksal ever gave information to Martha Stewart, and I think what you said, Jeff, is there was no way he could cooperate against her because he didn't have the information.

Martha Stewart's problem is that they have alleged the classic type of thing that prosecutors love to go after which is obstruction of justice.

(CROSSTALK)

That goes to the heart of what we do as prosecutors and law- enforcement officials in investigating a case, and if you undermine that, we're going to go at you with all guns blazing.

TOOBIN: The public relations effort that has been launched on Martha's behalf -- I mean, this week alone you had Hillary Rodham Clinton and Bill Sapphire at the "New York Times" both in a way coming to her defense. What's the impact of that?

SCHERTLER: I don't think in the end it has much impact. It might be nice for public relations right now. The fact of the matter is, either by way of a plea or by way of a trial, the government believes -- and I don't think they would have indicted this case unless they felt they had a strong case against her, because it is so high profile -- but the government believes that they have a case that they can make beyond a reasonable doubt at trial, and that's when the whole matter will be decided.

TOOBIN: You think it really doesn't matter? I mean, you don't think the public relations matters? I mean, this is a huge public- relations effort. I mean, it's been on both sides whether you consider the congressional investigation of her last summer where she was just beaten to death by the Republicans in Congress, and now she has people coming to her defense. Don't you think this might really have an impact on the trial?

SCHERTLER: Jeff, my experience has been in these high-profile cases you'll get some negative publicity here, you may get some positive publicity there, but if the case goes to trial, I do have an intrinsic confidence in the jury system, and essentially you get 12 people who will sit there and say, "OK, we'll put that all that aside. Let's listen to what the evidence is and find out if this person really committed a crime."

CRIER: The Bush administration and Congress, after Enron particularly, and then as things piled up, decided they had to make a public-relations statement by going after these guys strongly, and yet the response from the PR campaign is, "So, go after the big guys." Martha saved herself $45,000 of losses, but she didn't hurt anybody. Why aren't we seeing the perp walk with Ken Lay? That's the PR campaign that could actually get a political response.

SCHERTLER: Again, you have to kind of separate the cases and those cases are still ongoing, and you're going to see more charges in both cases. Whether they get to Ken Lay and Bernie Ebbers is a question.

But the fact of the matter is, I don't think Martha would have been charged other than the government is alleging she literally, along with her stock broker, made up a story out of whole cloth to explain this stock sale that was untrue. They have a couple cooperating witnesses that support that theory.

SMERCONISH: David, we've got to take a quick break.

Coming up on the docket: The Scott Peterson case; a judge orders both sides to keep quiet, but will they? Stay with us.

(COMMERCIAL BREAK)

SMERCONISH: Welcome back. The judge in the Scott Peterson murder trial has told both sides of the case to be quiet. He imposed a gag order, saying it's necessary to protect Peterson's right to a fair trial, but Peterson's lawyers opposed the order. In a separate matter, another judge ordered eight search warrants released to the public sometime next month. The searches were conducted before Peterson's arrest in April.

I got to talk to you about this gag order, David, because the media beast will still be outside the courthouse in Modesto looking to get fed. Anybody going to pay attention to it?

SCHERTLER: The media certainly won't. The lawyers do have some obligation to pay attention to it, and they'll have to limit their comments to what's on the public record. Whether or not it causes the media frenzy to die down, I doubt it, but there'll be less information in any case.

CRIER: The thing that I thought was interesting about the gag order is the judge is not limiting this to the discovery of other suspects of other people involved. So, it gives the defense the opportunity to go out there and talk about, "Where are you, real suspect? Let's find the real killer."

TOOBIN: Forgive my cynicism about this whole enterprise, but just I think this is not going to make a bit of difference. When you think about the leaks, the thing that the judge is really concerned about, the release of the partial-autopsy results, the so-called satanic-cult theory. All of that didn't come from the press conference, it came from a conversation between someone and a reporter. None of that is going to be stopped by the gag order. It seems to it's just a bunch of theater.

SMERCONISH: David, there was a subpoena issued to a judge last week, the judge that actually oversaw the wiretapping of Scott Peterson. How unusual is that? What's going to come from it from your perspective?

SCHERTLER: Well, it's highly unusual to subpoena a judge, and I think it's been described as an aggressive tactic by Mark Geragos and the defense team. Ultimately, I don't think anything will come of it. The wiretaps are approved by way of an affidavit that's submitted to the judge by the police, and he looks at the affidavit, decides it's sufficient, and allows him to go ahead and wiretap.

The problem here is that in the discussions about what was really the tapes, with the judge and the prosecutor, those are supposed to be recorded by a court reporter and apparently they weren't in this case. So you bring in the judge to say, "Well, this is what I recall about the conversations," but I doubt it will have any effect on the admissibility...

TOOBIN: Mark Geragos doesn't practice in Modesto. He's a Los Angeles guy. He doesn't care about who he alienates down there. He's got his own -- he can offend the judges. I don't know whether -- I don't think he's ...

CRIER: Any misconducts coming out of that? Because we still haven't heard the testimony about misconduct on the part of the prosecution, or the acquisitions of the conversations, the attorney- client conversations. It's protecting the record.

TOOBIN: In one sense, this is a pretty vanilla thing. They went and got a judge's approval for the wire, and that's what they do. But let's turn to another disturbing case in California, this one in San Jose. The man accused in the kidnapping and sexual assault of a 9- year-old girl was arraigned this week.

Enrique Sosa Alvarez faces charges including rape, child endangerment and residential burglary. He will enter a plea in July after his lawyer has time to review the case. The young woman's abduction was captured on a neighbor's security camera. Alvarez was arrested Monday after the girl provided key details about the suspect. If convicted, Alvarez could face life in prison.

Here we have a security camera performing a key role. Do you think there's any limit on how many security cameras we're going to have on any our -- does privacy matter here at all?

SMERCONISH: Jeffrey, what's significant here abut this security system is it's a middle-class family. It's a $1,500 security system with four cameras. The point being, security systems are no longer for just the wealthy fat cats among us or the corporate entities, but all Americans are going to have videotape systems to surveil their properties.

(CROSSTALK)

SMERCONISH: I don't think you have an expectation of privacy if you're walking down the street. If that camera comes into my home, then it's a separate matter.

CRIER: It's been interesting in Britain, because a lot of people have found themselves on tapes. They're putting together tapes and sort of selling them surreptitiously of scenes on the street. People aren't aware, so that kind of thing would be a violation. But it was interesting -- the Elizabeth Smart case, if we all remember, also had tapes that weren't necessarily good enough to find the cars that were coming in and out, but that was basically just the camera on the pole at the front of her street.

TOOBIN: I am inclined to agree with you. I think, basically, people are so concerned about crimes, that this is a cost that they are willing to pay. They are simply not worried about the civil- liberties aspect, the privacies. Put up as many cameras as possible.

SMERCONISH: How about this amazing 9-year-old girl? She remembered the pizza delivery, the telephone number -- can you put her on the stand?

SCHERTLER: Yes, you can. When you get down into the age of four, five and six, it's much more tenuous in terms of the reliability of that kind of witness. But nine years old, you can definitely put a 9-year-old on the stand. And especially, based upon what we have heard about this young girl, she really seems to have had her wits about her while this whole thing was going on.

CRIER: No question. When the judge takes on the obligation then of questioning, "Do you understand? Telling the truth," this child will pass with flying colors.

SCHERTLER: I agree.

CRIER: All right. Now, to our last case on the docket. Miami police have linked at least four sexual assaults to a serial rapist through DNA evidence. The victims, age 11 through 55, were attacked in their homes while they were alone. Police say the man speaks to his victims in Spanish and has worn the same piece of jewelry and clothes in several of the incidents. Because of the attacks on several children, police warned parents to keep a close watch on their latch-key kids.

OK, this is interesting, because we have Baton Rouge, Louisiana actually tracking down a serial killer because they ran through the neighborhoods collecting DNA. Is this going to become acceptable?

TOOBIN: I think it's totally going to become acceptable. I think what we're going to see is the gradual fading out of fingerprints. We have fingerprint banks, the FBI has fingerprint banks, and no one really has any civil-liberties objection to that. I think they simply just have to be replaced by DNA banks.

Think about it: This guy, I bet, when catch him, they're going to find he had a criminal record. This is not his first offense.

(CROSSTALK)

TOOBIN: If there were a DNA record where you could simply plug in his results, it would pop, you'd get a blind hit.

CRIER: What about the problem that we saw in Florida several years back where there was a rapist loose, and they went around and collected the DNA from 2,600 African-American men, stopping them on the street, not necessarily just in the neighborhoods where the rapes occurred. And there was quite an uproar, because it turned out the rapist was actually in Washington.

SCHERTLER: You're going to have a problem with that, Catherine, and you're going to have the same problem with that -- you know, Jeff alluded to this being the same as fingerprints, and I agree with him. You can't just go around fingerprinting, especially a distinct group of people, taking their fingerprints, and you can't do it with DNA analysis, too. I think that's where we'll have the problem. How can we get this data bank of DNA samples from people?

CRIER: I guess it just starts with the felons. the convicted felons.

SMERCONISH: You'll have less wrongful convictions with the DNA. That's the way to go.

(CROSSTALK)

TOOBIN: Accuracy is going to be helped in this system. I don't see that as a civil-liberties problem at all.

CRIER: Got to take another quick break. David Schertler, thank you very much for sharing your perspective with us.

SCHERTLER: My pleasure.

CRIER: And coming up next, the legal cases that make us say, "objection." Stay with us.

(COMMERCIAL BREAK)

CRIER: Welcome back. In April, Tacoma, Washington Police Chief David Brame shot his estranged wife, Crystal, before killing himself while his children waited nearby in a parked car. Crystal Brame later died of her injuries. Now her family has filed a $75 million claim against the city, alleging that officials ignored danger signs about David Brame.

An investigation of Brame's career has uncovered a date-rape allegation, and psychological-test results in the late 1980's determined him unfit for duty.

Interesting case at this time, because I think it reflects on several things -- one, the blue wall of silence, protecting one another, but, secondly, the problem with our employment laws, our discrimination laws. Nowadays, believe it or not, the police department might have been in trouble for holding cases like this -- situations like this against the chief.

TOOBIN: I have to say I am somewhat sympathetic to the police department here, because it is very hard to predict what someone is going to do down the road. You know, it seems to me the ultimate responsibility here is on David Brim, not on the police department.

SMERCONISH: He didn't shoot her because he's the chief. I mean, what if he went on to become a bus driver? I don't see any causation in this case.

Further down the west coast, Californians who want to talk on their cell phones while driving may soon have to keep both hands on the wheel. The California senate is considering a bill approved by the state's general assembly that would ban holding and talking on a cell phone while driving. Violators would be hit with a $20 fine for a first offense and 50 bucks thereafter.

If the bill is approved, California would join New York as the only states to ban hand-held cell-phone use while driving. What they ought to ban is stupidity. Yes, talking on a cell phone is dangerous, but so is changing the radio, putting in a CD, fixing your hair. All those things.

TOOBIN: This is a good law. In New York, it's worked pretty well. People spend more times in their cars in California than they do in New York. But it's a good thing.

(CROSSTALK)

TOOBIN: All right, next case. Now to a case of rough justice and tough justice in Texas.

A federal jury there ruled that Jose Luis Bethencourt had to forfeit his $5.5 million state-lottery prize, because he bought the winning ticket with cash made by selling cocaine. The jury didn't buy the defendant's claim that he purchased the ticket with money made from selling old clothes. God, I wonder why. Meanwhile, Bethencourt is awaiting sentencing for a drug-dealing conviction.

And what about the prize money? Uncle Sam gets the prize money, and you know what? I think it's tough luck for Mr. Bethencourt, but that's the way it has to be.

CRIER: It's the deficit.

TOOBIN: We have a deficit, and I don't want to see this guy making that money.

CRIER: The only problem I have with this is the forfeiture laws right now are really scary, and we need to look at those.

(CROSSTALK)

SMERCONISH: I spoke to the prosecutor this week, Jodi (ph) Young, and he said to me, "Look, if the guy taken the drug money and put it into Dell Computer stock and made a fortune, we'd be going after the stock." It;s the same principle that applies.

CRIER: OK. Bye, bye bucks.

Finally, we pose this question: Would you take this case? The Army is investigating allegations that U.S. Army Colonel Kassem Saleh, who is married, tried to woo prospective wives through Internet dating services. Well, dozens of women in the U.S. and Canada say they want to see the colonel punished and even thrown in jail. If the allegations against him are proven true, it is unclear whether they violate criminal law or Army regulations. Is this a breach of promise or just a breach of etiquette?

TOOBIN: He messed with the wrong women.

CRIER: Oh, absolutely.

TOOBIN: Because he found them on tallpersonals.com. So these are some tall women who are going to be after his butt.

SMERCONISH: My California stupidity law applies to these women. They never met him; it was an on-line thing.

TOOBIN: OK.

CRIER: But he's married. You can't make...

TOOBIN: Oh, there's lots of trouble with this guy.

That's all the time we have this week. On behalf of Catherine Crier and Michael Smerconish, I'm Jeffrey Toobin. Thanks for watching.

"CNN LIVE SUNDAY" continues after this break.

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Waksal Receives Sentence; Tacoma Chief Kills Estranged Wife, Self>


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