Southern District Judge William H. Pauley III (See Profile) had to order the arrest of a former juror on Feb. 15 as part of an effort to find out whether all or some of those convicted in the Jenkens & Gilchrist tax shelter fraud case deserve a new trial.
Suspended lawyer Catherine M. Conrad was arrested at her Bronxville home by U.S. marshals and hauled into court to answer questions about why she kept from the lawyers during voir dire in United States v. Daugerdas that she had a criminal history, that she was suspended from practice in New York state for problems associated with severe alcoholism, and that her husband was a convicted felon who served seven years behind bars in New Jersey.
Ms. Conrad was Juror #1 on the panel that convicted Jenkens & Gilchrist lawyers Paul Daugerdas and Donna Guerin, former BDO Seidman CEO Denis Field and former Deutsche Bank Alex.Brown banker David Parse on May 24 of a tax shelter scheme designed to provide wealthy clients with bogus tax losses (NYLJ, May 25, 2011).
After the verdict, lawyers with Brune & Richard, representing Mr. Parse, made a motion for a new trial saying they had discovered Ms. Conrad had lied about her identity.
But prosecutors argue that Theresa Trzaskoma of Brune & Richard knew Ms. Conrad’s identity within two hours of the start of jury deliberations on May 12 and that she shared her concerns with Susan Brune and Laurie Edelstein of the firm. This knowledge, they argue in papers filed with Judge Pauley, constitutes a waiver of any right to ask for a new trial.
On Feb. 15, while Ms. Conrad waited in a holding cell off a courtroom on the 24th floor at 500 Pearl St., Ms. Trzaskoma was questioned by Assistant U.S. Attorney Jason Hernandez about how and when she came to learn about Ms. Conrad’s background.
Ms. Trzaskoma said she woke up on the morning of May 12, 2011, wondering why Juror #1 had sent a note to the judge asking questions about respondeat superior and vicarious liability—terms not usually thrown around by a layperson.
Ms. Trzaskoma said she began an investigation with the help of a paralegal, learning on Westlaw that Juror #1 had the same last name as a suspended attorney. At one point she sent an e-mail saying, “OK, unless Conrad totally lied about her highest level of education, it can’t be the same person as the suspended lawyer. But let’s keep a little dossier on her.”
But in yet another e-mail, Ms. Trzaskoma states, “Jesus, I do think it’s her.”
Ms. Trzaskoma insisted under questioning on Feb. 15 that there was confusion regarding Ms. Conrad’s real identity and that, in the end, she and her colleagues simply could not believe she was the same person as the suspended attorney. That possibility, she said, “was just so far out there, so remote” that they dismissed it.
However, one problem for Brune & Richard is that, in the fact section of their memorandum asking for a new trial, they neglected to mention either their suspicions or their inquiries during trial and only made their motion after lead prosecutor Stanley Okula disclosed to the court he had received a post-trial note from Ms. Conrad saying, “KUDOS to you and your team.”
Under pressure from Mr. Hernandez, Ms. Trzaskoma expressed “regret” for not including her pre-deliberation investigation and suspicion in the memorandum.
“It should be in there, correct?” Mr. Hernandez asked.
“I regret the brief conveyed the impression it had never occurred to us before,” she said. Nonetheless, Ms. Trzaskoma insisted that she had been straight with Judge Pauley when asked by the judge during a post-trial conference whether she or the firm had any knowledge—at trial—that Ms. Conrad was the same person as the suspended lawyer.
“We did not know at trial,” she said.
Judge Pauley had one question for Ms. Trzaskoma, reminding her that, on the third day of deliberations, May 16, he had excused one juror for medical reasons, seated an alternate and then instructed the panel to begin deliberations anew.
“During that entire episode, did you ever revisit the question of Juror #1 and the possibility that she might be someone other than who she said she was?” the judge asked.
“I did not,” Ms. Trzaskoma answered. “I genuinely believed that Juror #1 was who she said she was.”
Former Juror Testifies
Then it was Ms. Conrad’s turn.
Ms. Conrad had behaved erratically at a Dec. 20 hearing in which Judge Pauley said she would be subpoenaed to testify at the Feb. 15 hearing.
“I reject it and you’re going to have to arrest me because nothing is going to change,” Ms. Conrad responded at the time. “They’re fricken crooks and they should be in jail and you know that. Good.”
Ms. Conrad phoned chambers at 7:52 a.m. on Feb. 15, telling a judge’s deputy, “I will not be coming and I will not testify.”
Shortly after the hearing began at 9:30 a.m., Judge Pauley issued a warrant for her arrest.
After she was led into the courtroom, Judge Pauley instructed her court-appointed counsel, Bobbi C. Sternheim, to sit in the jury box as close as possible to the witness stand to keep Ms. Conrad on track.
As arranged beforehand, Ms. Conrad invoked her Fifth Amendment right not to testify and the judge compelled her to answer by granting her “use immunity” for her testimony. That would prevent the prosecution from using her testimony or any evidence derived from the testimony against her.
Christopher Gair of Jenner & Block in Chicago, trying to win a new trial for Mr. Daugerdas, began a tortured direct examination of Ms. Conrad, asking her time and again if she knew the difference between rational and irrational and whether it was rational to flout an order of a federal judge or lie about her identity during voir dire.
“I don’t know, I’m not a psychologist,” Ms. Conrad said repeatedly.
At one point, she glared at the defense lawyer and said, “Why don’t we get to the meat of this?”
She insisted, “I was a very unbiased juror” and when asked again if she could tell the difference between rational and irrational, she stated, “It has nothing to do with the jury verdict that was rendered against your client.”
“Have you ever been examined by a psychologist?” Mr. Gair asked. “Has anyone ever told you you suffer from bi-polar disorder? What medications do you take?”
“Water,” Ms. Conrad answered.
“That’s a medication?” Mr. Gair asked.
“If it calms me down, sure,” Ms. Conrad said.
Mr. Gair introduced into evidence the 2007 decision of the Appellate Division, First Department, suspending Ms. Conrad from practicing and a 2010 decision by the same court denying her reinstatement.
After being asked a few questions by Paul Shechtman of Zuckerman Spaeder who represents Mr. Parse, Ms. Conrad was asked several times by Mr. Okula whether she entered the case with an ax to grind. “Were you biased against the defendants in any manner or form,” Mr. Okula asked.
“Not at all,” she responded.
At the close of the day, Judge Pauley asked Ms. Conrad why she perjured herself when she answered questions on voir dire.
Ms. Conrad said that, while she was unemployed, it certainly was not for the money. Instead, she said she missed the dynamics of the courtroom and was interested in serving as a juror at trial.
Ms. Conrad was released at the end of the day, but Judge Pauley did not lift the arrest warrant, as it is possible she could be recalled to court.
The hearing will continue on Feb. 16.
Mr. Daugerdas was convicted on 18 counts of tax evasion and Ms. Guerin nine counts for giving their legal blessing to the tax shelters prosecutors said had no economic purpose. Mr. Field was convicted of four counts of tax evasion. The three of them and Mr. Parse were found guilty of mail fraud and a corrupt endeavor to obstruct and impede the tax laws.
Raymond Craig Brubaker, a banker at Deutsche Bank, was acquitted on all counts.
Also appearing for the defendants at the Feb. 15 hearing were Mark Rotert of Stetler, Duffy & Rotert in Chicago for Ms. Guerin; and Sharon L. McCarthy of Kostelanetz & Fink for Mr. Field.
@|Mark Hamblett can be contacted at firstname.lastname@example.org.