Former Luzerne County Common Pleas Judge Mark A. Ciavarella Jr. leaned back in his chair with his hand on his chin during opening arguments of his federal racketeering trial Tuesday, listening as the prosecution told the jury that he and former Luzerne County President Judge Michael T. Conahan had “turned the court of common pleas into a criminal enterprise.”
During the course of his arguments in U.S. District Judge for the Middle District of Pennsylvania Edwin M. Kosik’s courtroom, federal prosecutor Gordon A. Zubrod alleged Ciavarella and Conahan had accepted kickbacks from builder Robert K. Mericle for the construction of two private juvenile detention centers, PA Child Care and Western PA Child Care, and had extorted millions of dollars from the facilities’ former co-owner, Robert J. Powell.
But the defense contended that the money Mericle paid was originally intended only for Ciavarella as a “finder’s fee” for his help in bringing the builder in on the projects and one that both men believed was a legal business transaction.
The defense also argued that Powell was no victim, but rather a willing accomplice in several schemes masterminded by Conahan without Ciavarella’s knowledge.
According to Zubrod, Ciavarella reached out to Powell, a successful Luzerne County trial attorney and businessman, in the late 1990s about opening a private juvenile detention center that would replace the county-run center.
Soon after, Ciavarella enlisted his “very, very close friend” Mericle to build the facility, Zubrod told the jury.
In 2001, according to Zubrod, Mericle informed Ciavarella that he intended to pay the judge a “finder’s fee” for bringing him aboard the project.
“Here’s where the conspiracy begins,” Zubrod told the jury.
According to Zubrod, Ciavarella told Mericle to make it appear as though he was paying the money to Powell, who would then redistribute the money to both Ciavarella and Conahan.
Mericle agreed and, following the completion of the PA Child Care facility in 2003, paid more than $997,000 to Powell, who then forwarded the money to the judges, who split the proceeds roughly down the middle, Zubrod said.
In 2001, Conahan agreed in writing to send juveniles to PA Child Care, informing Powell that he and Ciavarella would require a cut of those proceeds as well, according to Zubrod.
Zubrod told the jury that Powell, who was saddled with a $12 million mortgage on the facility, complied because he was afraid he wouldn’t get any business otherwise.
Powell knew Conahan and Ciavarella “could ruin him,” Zubrod said.
During this time, Zubrod said, Conahan and Ciavarella took steps to have the county’s juvenile detention facility shut down.
Former Luzerne County Commissioner Tom Makowski later testified that the common pleas court informed the county in 2002 that it would no longer send juveniles to the county’s facility and would remove the facility from its budget.
Makowski testified that the court also returned the county’s license for the facility to the state, effectively shutting it down.
In October 2003, according to Zubrod, Powell docked his boat at a condominium owned by the two judges and their wives.
Around that time, Zubrod said, Powell also formed Pinnacle Group of Jupiter with Conahan and Ciavarella.
But, in 2004, the judges “turned on Powell” and began gouging him for more money, according to Zubrod.
“Powell said, ‘Don’t tell me you burned through $1 million already,’ and their response was, ‘Heh heh, yeah, we burned through it,’” Zubrod told the jury.
The judges then instructed Powell to make the next payments to Pinnacle, disguised as rental payments for the condo, Zubrod said.
According to the prosecution, Powell complied, paying $590,000 to the judges in less than nine months.
When Mericle built Western PA Child Care for approximately $9.7 million, the judges again took a $1 million cut, funneling the money through Pinnacle as rental income, Zubrod alleged.
Later, when Mericle built expansions on both PA Child Care and Western PA Child Care, the judges received payments of $150,000 for each project, according to Zubrod.
Zubrod told the jury Powell eventually moved his boat to Costa Rica and took his family on a vacation to Italy for a month in the summer of 2006 to get away from Conahan and Ciavarella.
According to Zubrod, Ciavarella told Powell, “If you can take your children and your family to Italy, you can pay us.”
From August 2006 to December 2006, Powell paid the judges another $140,000, using employees of his firm, the Powell Law Group, to deliver FedEx boxes full of money, according to Zubrod.
According to Zubrod, Ciavarella never reported any of this money on either his tax returns or his financial disclosure forms and both IRS Agent Ben Wylam and Nicholene DiPasquale of the Administrative Office of Pennsylvania Courts testified to these allegations.
But Ciavarella’s attorney, William Ruzzo, painted a much different picture of Powell, beginning his arguments by referring to his large physical stature.
At well over 6 feet tall and nearly 260 pounds, “Powell is not a man to be extorted,” he said, calling the prosecution’s assertion that Powell was a victim “nonsense” propagated by Powell in an attempt to avoid the wrath of his business partner and possibly legal authorities for taking money from the detention centers and using it for personal gain.
According to Ruzzo, not only was Powell not being extorted, he actually socialized regularly with both judges and engaged in other business transactions separate from the detention facilities.
Ruzzo said Conahan once paid Powell $50,000 for use of his private plane and that, on another occasion, both Conahan and Ciavarella paid Powell $50,000 for use of his boat.
“If you’re extorting someone, do you go and pay $100,000 for the use of their toys?” Ruzzo asked the jury.
Ruzzo also told the jury that Ciavarella was not aware of the payments Powell had been making to Pinnacle and that a conversation between Powell and Conahan while Powell was wearing a wire indicated as much.
“You know why he didn’t get the smoking gun?” Ruzzo asked the jury. “Because there was no smoking gun.”
As for the finder’s fees Mericle paid to Ciavarella, Ruzzo said neither man intended them to be kickbacks and that it was Ciavarella’s decision to share the money with Conahan without Mericle’s knowledge.
The fact that the money was paid to Ciavarella indirectly was not an attempt to hide the payment from authorities and did not make it illegal, Ruzzo said.
“It’s pretty hard, anyway, to send a wire transfer and keep it a secret,” he said.
Toward the end of his opening statements, Zubrod said both Powell and Mericle would testify, as would former Luzerne County Prothonotary Jill Moran, Pat Owens, treasurer of the Powell Law Group and Conahan’s tipstaff, Nick Callen.
Ruzzo said Ciavarella would be testifying on his own behalf.