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In the first of the closing arguments in the trial of the two former top executives of Tyco International Ltd., the lawyer for former chief financial officer Mark Swartz said his already well-compensated client had no motive to steal from the company. “He was the highest-paid CFO in the country,” said defense lawyer Charles Stillman, noting that Swartz received almost $50 million in disclosed compensation in 2001. The Manhattan District Attorney’s Office has charged both Swartz and former Tyco chief executive officer L. Dennis Kozlowski with grand larceny, securities fraud and falsifying business records over their alleged theft from the company of more than $150 million in unauthorized loans and bonuses. It is the pair’s second trial on those charges. Manhattan Supreme Court Justice Michael Obus declared the first trial a mistrial last April after one juror, who had been identified by some newspapers as a holdout for acquittal, was contacted by an outside party. The retrial, also before Justice Obus, began in January. The prosecution’s case has depended heavily on former members of Tyco’s board of directors who have testified that they never approved several bonuses paid to Kozlowski and Swartz. But Stillman said Monday that his client never made any attempts to conceal bonuses and loans and pointed out that those payments were known to others, including the company’s outside auditors at PricewaterhouseCoopers. That fact, he said, was “absolutely devastating” to the prosecution’s case. Where information on the payments was missing, as in Swartz’s W-2 income tax form, said Stillman, it was an honest mistake. It was not, the defense lawyer said, the sort of mistake lawyer David Boies suggested when he testified for the prosecution. Boies had testified about confronting Swartz during a 2002 internal investigation of Tyco conducted by his law firm, Boies Schiller & Flexner. When the CFO was asked about the omission of $12.5 million in loan forgiveness, Boies had said, Swartz admitted concealing the bonus was a “mistake.” Stillman said Swartz meant only that the omission was an oversight. Stillman said Monday Boies’ testimony made no sense and lacked credibility given his role representing Tyco in civil suits against Kozlowski and Swartz. The defense lawyer called Boies the “$40 million man” in reference to his law firm’s billings to Tyco over the past three years. Stillman, of Stillman & Friedman, said the W-2 omission by itself showed nothing and noted that no tax charges had been brought against Swartz. The defense lawyer said the prosecution’s case amounted to “guesswork and speculation” and added that prosecutors were inviting the jury to speculate wildly on Swartz’s motives. “Mistakes were made,” said Stillman. “That doesn’t mean a crime was committed.” Kozlowski’s lawyer, Stephen Kaufman, is expected to begin his summation today, with the prosecution to follow later in the week. Assistant Manhattan District Attorneys Owen Heimer and Ann Donnelly are prosecuting the case. The jury is expected to get the case after the Memorial Day weekend.

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