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Judge declares Tyco mistrial

Tyco judge declares mistrial, cites pressure on juror

From wire reports
NEW YORK — The judge in the Tyco International (TYC) case said Friday he had "no choice" but to declare a mistrial, citing outside pressure on one of the jurors.

Former Tyco CEO Dennis Kozlowski and wife Karen, entering court Friday.
Louis Lanzano, AP

A gasp rippled across the courtroom when the mistrial was announced after a nearly six-month trial.

The decision came on the 12th day that the jury had the the case against former chief executive L. Dennis Kozlowski and former chief financial officer Mark Swartz. (Video: Mistrial declared after nearly six months of testimony)

A source, speaking to The Associated Press on condition of anonymity, said that Juror No. 4 had received a threatening or coercive letter within the past 24 hours.

Juror No. 4 became the subject of intense media scrutiny last week after some news organizations reported she made an "OK" gesture toward the defense as she passed in front of lawyers. The Wall Street Journal and the New York Post named the juror.

Defense lawyers repeatedly asked for a mistrial, saying the juror — an apparent holdout for acquittal — was being pressured by the media and possibly by other jurors to change her vote.

"It is certainly a shame that this has to be done at this time," state Supreme Court Justice Michael Obus told jurors after announcing his decision. "There has been no finding that this juror has done anything wrong," said Obus. "A great disservice may have been done to her and her family."

The judge said jurors were free to discuss the case with the media but cautioned them their words would "forever be in the public domain."

The jurors left the courthouse on a bus without comment, though the judge said they were free to talk to the media.

"We literally were within minutes" of reaching a verdict, juror Peter McEntegart told CNN, adding that the jury was not permitted to deliberate Friday. "That's difficult for me right now." He said it would have been a split verdict, convicting on some counts and acquitting on others.

The Post and Journal broke with normal journalistic conventions in naming the juror while the trial was under way. Col Allan, editor of the New York Post, said the newspaper did so because of a gesture in the courtroom interpreted by some to be an 'OK' sign to defendants, which he said "created public interest in her identity."

The Journal gave a similar reason for its decision. Other journalists, including an AP reporter, who were in the courtroom did not interpret the gesture as any kind of signal.

The mistrial raises the possibility of another trial for the two men, who could get up to 30 years in prison.

New York's district attorney vowed to seek a retrial against two men.

"The Manhattan District Attorney's Office intends, at the earliest opportunity, to seek a retrial," Manhattan District Attorney Robert Morgenthau said in statement. "For that reason, any further comment would be inappropriate."

Kozlowski's lawyer, Stephen Kaufman, said all sides would return to court May 7 to set a possible date for a second trial.

"We're disappointed because of the events that occurred outside the courtroom that this case did not reach a verdict," said Kaufman, who declined to answer any questions.

After the proceedings ended, Kozlowski told the AP, "I'm relieved now." He walked out of the courthouse with his wife and left in a black sport-utility vehicle.

The trial came amid a spate of high-profile cases involving corporate corruption. During the trial, federal prosecutors brought criminal charges against former executives of WorldCom and Enron, and Martha Stewart was convicted of lying to investigators in a stock scandal just blocks away in another Manhattan court.

The case exposed a culture of greed atop Tyco, a conglomerate that makes everything from coat hangers to undersea fiberoptic cable.

Prosecutors said Tyco picked up the tab for a long list of extravagances: half the $2 million birthday bacchanal for Kozlowski's wife; $15 million worth of furnishings for an $18 million Fifth Avenue corporate apartment.

The government accused Kozlowski and Swartz of stealing $170 million by hiding unauthorized bonuses and secretly forgiving loans to themselves. They also were accused of stealing an additional $430 million by pumping up Tyco stock by lying about the company's finances.

Defense lawyers countered that the two had earned every dime and that the board of directors and auditors knew about the compensation and never objected. They said — and prosecutors did not dispute — that Kozlowski once legitimately earned more than $100 million in one year.

Before the focus shifted to the jury, the case at times seemed more like an episode of "Lifestyles of the Rich and Famous" than a criminal trial.

Jurors saw a videotaped tour of the Tyco-owned apartment where Kozlowski lived while in Manhattan. On the walls were paintings by Monet and Renoir.

Some of the apartment's decorating touches became infamous: the $6,000 floral-patterned shower curtain in the maid's bathroom; a $15,000 sculpted terrier, on its hind legs with a brass ring through its paws to hold umbrellas; a $17,100, leather and bronze Venetian "traveling toilette box," stored in a closet.

Jurors watched an edited videotape of the $2 million Roman-themed party that Kozlowski threw for his wife's 40th birthday on the Italian island of Sardinia in the Mediterranean.

The fete featured a performance by singer Jimmy Buffett and, as the CEO put it, "all the things we're best known for." The jury saw young men and women performing, dancing and serving, with men dressed as Roman soldiers and women as Roman maidens.

Swartz, who was not portrayed as a gatherer of gaudy goodies, was accused of using millions of Tyco dollars for personal investments and real estate speculation.

One example cited by prosecutors was his attempt to buy a dozen apartments in the Trump International Hotel and Tower so he could rent them, as income producing properties for himself, to Tyco for company employees in New York.
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