Month: May 2009

Liveblogging Oliphant with Day 5 of Mulroney on the stand

Former prime minister Brian Mulroney is on the stand again today at the Oliphant Commission, an inquiry into certain business dealings of Karlheinz Schreiber and Mulroney. It is Mulroney's fifth day on the stand and, we are told, his last.

Commission counsel Richard Wolson will continue his cross-examination this morning. Other lawyers here will then get a crack at him, if they so choose. Schreiber's lawyer will certainly be among them but it's not yet been announced if that lawyer, Richard Auger, will proceed. That's because Auger's client — the aforementioned Karlheinz had emergency gall bladder last Tuesday night. As of Friday at noon, Auger had not yet had a chance to confer with his client. If he has had that chance over the weekend, expect him to follow Wolson.

I'll be liveblogging the proceedings but not here. You'll have to head over to our sister site on the Canada.com network.

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More on Conrad Black and "honest services"

Earlier today, the U.S. Supreme Court agreed to review Conrad Black's fraud conviction. Legal beagles believe it is because the Supremes are keen to weigh in on the concept of “honest service” as it applies between private parties:

…“It’s one-in-a-million for the court to review a criminal case,” said a U.S. lawyer who spoke to Canwest News Service on Monday. Neither the lawyer nor his firm are involved in the case.

“And they don’t hear these cases unless they want to overturn,” the lawyer said.

George Jackson, a lawyer with the Chicago-based law firm Bryan Cave LLP, was less certain the Supreme Court will overturn the fraud conviction but said the court seems to be interested in using the Black case to clarify a legal concept — the definition and application of “honest services” in U.S. law — that appears to have differing interpretations among America’s lower courts.

“It is not surprising that the Supreme Court has agreed to hear this appeal,” Jackson said.

“The Supreme Court may not rule in Conrad Black’s favour, but I do believe they intend to resolve the debate over the application of honest services. The increased use of this statute coupled with the split among the circuit courts makes the Black case ideal for Supreme Court review.”

In their brief to the Supreme Court, Black’s lawyers noted he was found not guilty of several charges but was found guilty on three charges of mail fraud “based on an instruction that permitted the jury to find a ‘scheme to defraud’” — a hotly contested element of the offence — by determining that petitioners either stole the company’s money, or deprived the company or its shareholders of their right to (Black’s) “honest services,” according to the brief.

At trial, the prosecution successfully convinced the jury that Black and his associates deprived their victims of the “honest services” they owed to their victims, the shareholders of a New York company Black controlled, Hollinger International Inc.

The concept of “honest services” first entered the U.S. legal lexicon in the 1970s, when lawmakers wanted to to make it illegal for a politician, for example, to award jobs or contracts to cronies and, in doing so, unfairly earn a political advantage. In this kind of scheme, voters were being deprived of the “honest services” they were entitled to from the politician.

Lawyers and some jurists subsequently expanded the concept to the corporate arena, notably in the Enron case. But several U.S. courts have interpreted and applied the concept in different ways.

In agreeing to hear the review, the U.S. Supreme Court appears ready to rule on the definition and application of just what it means to provide an “honest service” in the context of a corporation or a contract between private individuals.

“The (U.S.) Courts of Appeals are hopelessly divided on the application of (honest services) to purely private conduct,” Black’s lawyers wrote in their brief. …

Read the full story
Also: Let me point you at a piece by Paul Waldie, a friend and former colleague at the then-Black owned National Post, who looks at the issue of “honest service” in a little more detail.

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Conrad Black gets a shot at freedom

In a decision that stunned plenty of legal beagles, the U.S. Supreme Court has agreed to review Conrad Black's fraud conviction. One lawyer I spoke to said it's a “one-in-a-million” chance that SCOTUS agrees to review a criminal conviction.

But review, they will. (They will not be reviewing Black's obstruction of justice conviction.) Black has been in jail in Florida since March, 2008 on a 6 1/2 year stretch. The court will review his case in October.

From SCOTUS Blog:

Docket: 08-876

Title: Black, et al. v. United States

Issue: Whether the “honest services” clause of 18 U.S.C. § 1346 applies in cases where the jury did not find – nor did the district court instruct them that they had to find – that the defendants “reasonably contemplated identifiable economic harm,” and if the defendants’ reversal claim is preserved for review after they objected to the government’s request for a special verdict.

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Ever seen a $1,000 bill?

We're in the last 10 minutes or so of testimony this week at the Oliphant Commission. Brian Mulroney is on the stand, getting a grilling about the cash he received from Karlheinz Schreiber.

We've heard a lot about how, three times, Mulroney received envelopes stuffed with 75 $1,000 bills from Schreiber.

You ever seen $1,000 bill? I don't think I ever have. In fact, I don't think Canada prints them anymore but here's the ones that are out there:

These images and more information, incidentally, are available at the Bank of Canada's Web site.

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Wolson connects the dots on Schreiber's unique access to Mulroney

Richard Wolson, Oliphant Commission counsel, does a very effective job of using the documentary record to connect the dots to show that Schreiber had unique access to Mulroney, access that some might think exceptional for an individual that Mulroney said had a “peripheral” relationship with the PM.

Check out all the details here.

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Mulroney's technical explanation of the coffee with Schreiber

As Mulroney's second day on the stand under cross-examination from commission counsel Richard Wolson begins, we keep coming back to Mulroney's testimony on April 21, 1996 as part of his lawsuit against the federal government for libel and slander.

In it, you'll recall, he is asked if he knows Schreiber. He replies he might have had a cup of coffee with him.

As Wolson reminded him yesterday, it was more than a cup of coffee, it was a cup of coffee at the end of which, Mulroney walked away with $75,000 in cash stuffed into an envelope!

Why didn't Mulroney tell the court about the nature and circumstances of his relationship with Schreiber when asked about it by government lawyers in 1996. Mulroney replies (and this is my shorthand, not the official transcript):

“This might sound technical to some people but I ask you to simply remembr the context: At that point, I'm fighting for my life and my family's honour. I'm confronting the government of Canada who is spending millions of dollars on top-flight legal talent. I had offered the government full and complete co-operationg prior to the publication of the letter. They turned us down flat. I walk into the courtroom in Montreal and I'm facing 9 lawyers who are out to destroy me. …
So I'm told to go in there and deal with it in exactly the truthful manner that I did…”

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Time to pare it back on Facebook: Goodbye to some FB friends

If just six more people became my Facebook friend, I'd have 1,000. Seems like a worthwhile goal to shoot for, doesn't it? And, a few weeks or months ago, I might have said yes.

But with 994 friends — most of whom I do not know — Facebook's value is much less than what I think it could be. I know I'm missing updates, info, photos — you name it — because I'm getting drowned by updates, info, photos, etc. from individuals I don't have much interest in. Remember: I am not using Facebook to sell products, find high school friends (though I'm pleased to have found more than a few), or publish pictures of my kids. I'm on Facebook — and any other social media service, such as Twitter — for professional reasons only.

And so, I've come to the conclusion that less is more on Facebook — fewer friends means greater value. So, over the next little while, I'm going to be saying goodbye to Facebook friends and Facebook apps.

So to those who I'm going to 'unfriend' on Facebook, a message: First, thank you for being my Facebook friend. I appreciate your interest. Secondly: my contact info is always online at my own Web site. Feel free to call or send e-mail anytime. Thirdly, my blog is where you'll find a lot of conversations I'm interested in. And, finally, Twitter has, indeed, upended Facebook in terms of short micro-bursts about where I am and what I'm doing. You can follow me on Twitter @davidakin.

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Liberals ask for cash to fend off Tory attacks

The Liberal Party of Canada has sent the following out to its members:

Trust the Conservatives to get attack ads out faster than they can deliver their promised stimulus funding. Unable to provide leadership himself, Stephen Harper has launched new ads attempting to divert attention away from his government's failures to fix the economy and to undermine the credibility of the one leader he knows can take his place – Michael Ignatieff.

Enough is enough. Please make a donation today and help Michael respond with a new kind of politics and hold this government to account.

Canadians deserve a government dedicated to solving problems, not partisan attacks. Our future depends on it. Michael's honesty and leadership have already begun to offer Canadians a sense of hope for a brighter future, with a government that will help Canada prosper and grow. Show your support and let's remind the Conservatives that their games won't work – Canada comes first.

Thank you,

Rocco Rossi

National Director

Liberal Party of Canada

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Bank of Canada research: Current crisis hitting our banks harder than earlier ones

The Bank of Canada has just released a research paper authored by Fuchun Li in which Li argues for a new kind of “stress test” to see how Canadian banks are faring under the current fiscal crisis and compares that result to how they fared under earlier fiscal crises. Li is an employee of the bank, working in its “Financial Stability” department. From the paper's abstract, here's what he has to say:

First, compared to recent financial crises, including the 1987 U.S. stock market crash, 1994 Mexican peso crisis, and 1997 East Asian crisis, the ongoing 2007 subprime crisis has been having more persistent and stronger contagion impacts on the Canadian banking system. Second, the October 1997 East Asian crisis induced contagion in Asian countries, and it quickly spread to Latin American and G-7 countries. The contagion from the East Asian crisis to the Canadian banking system was not as strong or as persistent as that of the ongoing subprime crisis. However, it had a stronger impact on emerging markets. Third, there is no evidence of contagion from the 1994 Mexican peso crisis to the Canadian banking system. Contagion from that crisis occurred in Argentina, Brazil, and Chile, but the contagion effects of that crisis were limited to the Latin American region.

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Mulroney gets cross-examined

Freezing at Oliphant on 12seconds.tv

Well, what are we to make of the first 90-minutes of what's certain to be a much longer relationship between Richard Wolson, the counsel for The Oliphant Commission, and the Rt. Hon. Brian Mulroney?

Turns out they spent most of that 90 minutes trying to sort out just what it was Mulroney was talking about 13 years ago when he was deposed by lawyers representing the federal government, the very government he was suing at the time for smearing him with accusations that he took bribes from Airbus while in office.

I don't want to put words in Wolson's mouth but he seemed, at the very least, sceptical that Mulroney answered questions put to him in that deposition in a “fulsome” manner. Mulroney, having been sworn in to tell something approximating the truth, the whole truth, and nothing but the truth seems, in Wolson's opinion, to have gone two for three in that department. Wolson seemed to be checking to see if “the whole truth” was, in fact, offered by Mulroney.

The “whole truth”, it seems from Wolson's line of questioning this morning would have involved Mulroney telling lawyers in 1996 who were asking him about his relationship with Karlheinz Schreiber that, yes, he certainly did have a commercial relationship with Schreiber, and, oh by the way, on three occasions, Mulroney accepted envelopes from Schreiber stuffed with thousand-dollar bills, cash that never made it into a bank account.

Mulroney agreed to disagree with Wolson's characterization, relying on the finer points of Quebec civil law, that, on advice of his counsel, he answered the questions truthfully and precisely and that no one every asked him if he had a commercial relationship with Schreiber.

Why is all this important? It all goes to credibility. At the end of the day, we, the Canadian public, have asked Mr. Justice Jeffrey Oliphant, to tell us if he believed Mulroney engaged in any behaviour which was unethical while he was in office or in the period shortly after he left office. Schreiber, a fugitive from German justice whose credibility is weak just on that point alone, alleges that Mulroney engaged in behaviour with him that would be construed as unethical. Mulroney's credibility could be weakened if what he says now about his relationship with Schreiber fails to match up with what he's previously told judges or parliamentarians under oath or journalists when they've interviewed him about this matter.

My opinion after 90 minutes? If you had a low opinion of Mulroney's credibility before these hearings, I bet you still do. If you think he's conducted himself appropriately, you most likely still feel that way.

There were no new facts presented this morning and both men, while appearing respectful of each other, also got a bit grumpy at times with each other.

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