1. From the Mountaintop: Last Weekend
On a mountain overlooking Birmingham, there is a statue of Vulcan. Not one of the guys from the Enterprise, but the Roman god of the forge. While standing watch over the city, he is a visible reminder of the city’s unique past. Birmingham was planned to sit on the intersection of north-south and east-west rail lines, and to be a steal-producing city of the Industrial Age. The city dates to 1871, and it was an unusual venture for the South, where the agrarian society had been crippled by the Civil War. It would become a manufacturing center, and although it has branched into other industries, notably medical research and banking, there is at least one steal-producing company in the area.
I was reading in the paper, the other day, that the guy who made the giant statue of Vulcan also made a bust of Jesus Christ, and he intended them to be displayed together. The union of the Roman god of the forge and the Christian God is a pretty good summary of the region. Of course, the symbolism does little to explain the journey that Birmingham has been on, but the roots are clear.
So why did HealthSouth originate here? Was it just a good place for Scrushy to make something in a place that was familiar to him? Or were the remnants of a battlefield, the rise of the upscale surrounding communities, and the declining economy a good place to set up a kingdom?
It is the weekend before the trial. If I can make a prediction, but I don’t think it is a very difficult one, there will probably be a flurry of motions on Monday: Perhaps some last-minute suppression pleas and most certainly a request for a continuance. Yes, the Alabama brain trust is becoming a tad predictable, and the trial hasn’t even started yet. If there is no improvement in the arguments, the trial will begin on Tuesday.
2. The Faces of Trial
The Defendent
Scrushy shows many faces. He is sometimes relaxed and smiling. At other times, he is tense and focused. And then there are those icy stares. When he greets people, he is warm and friendly, and inviting. When he wants to send a message across a room, it is clear and unequivocal. His public and private side have met in the courtroom. He is no longer able to separate the two, and for the duration of trial, a situation he can not control, he’ll be forced to drift back and forth between the two sides of Richard M. Scrushy.
Counsel for the Defense
Parkman has the friendly face of a used car salesman. His demeanor says that I’m going to be as charming as possible, because I may need something from you, even if I don’t know what it is right now. It is a consistent façade. Perhaps he goes home to curse at the walls, but that’s an unknown because he only puts on one demeanor, puts only one continence on display. I’ve seen him greet both friends and strangers with the same amount of disarming but a little unctuous down-home charm. The feeling is that even if it is an unfamiliar face, there might be some reason to get that person on my side. On my side, I can control the situation. When he is on stage, in front of the jury, there is an occasional scowl, but it is well-timed for maximum effect. [Perhaps if he should ever have occasion to read this stuff, this will all change.]
The Bailiff
With long silver hair, in a pony tail, she’s the jack-of-all-everything in the courtroom. I overheard her explaining to someone that, “If the judge said we’re going to do brain surgery in the middle of the courtroom, then we’ll do our best.” And she’ll do it with a smile. Her duties are variously to swear in witnesses, signal to retrieve the jury, help fix or employ the courtroom monitors, be a cheerleader and caretaker for the jury, helping to retrieve documents for the judge, and assisting both the prosecution and defense with whatever they need. In terms of how many things she does and the mileage she travels, she’s the hardest working person in court.
US Marshal
There’s a Marshal here who reminds me of the Duke’s manservant, in Moulin Rouge. He is the quintessential security-type, calmly waiting for nothing to happen. Even when he is happy or pleased, his mouth doesn’t go to a full grin, but instead, is more of a half-open straight line. But you can tell he is happy by contrast to his usual working face. All of the marshals are polite and professional, but I’m not much of a threat.
Whereas lives will change in this place, and this place will change lives, the faces will remain the same.
3. ‘The fog of trial
Parkman’s overall strategy has been to adopt a scattershot approach: Shoot at everything and try to kick up enough dust and smoke that everything in the target area is in a murky realm where the truth and lies, and everything in-between is obscured so well that the two poles are indistinguishable. And if bigger targets remain standing, or lurk out of the mist, then roll out the canons. After doing this for a couple of days now, there are some discernible shapes and movement on the other side, so he must not be done now. Besides smoke and fog, his other weaponry is the semantic duel that also had mixed results today. In keeping with this spirit, the entry today is a little bit scattershot as many themes were addressed. Picture one of those very busy gallery arcades: Something like that.
Part of the strategy was to give the jury alternative explanations that were contrary to the earlier ones provided by Owens. Some of these theories may not have made much sense, either from a business perspective or in basic logic, but the goal is to make it sound plausible enough to create doubt in the jury’s mind. Owens said that they were going to use a change in Medicare regulations (Transmittal 1753) as an excuse to lower HealthSouth’s earnings by $175 million. Lowering the stated earnings of the company was the first step toward cleaning up the fraudulent books, before they were inevitably exposed. According to Owens, there was a real aspect to the effect of the Medicare change, which the company placed at $15 – $20 million, and there was a phony aspect, where they were going to inflate the real portion to $175 million. The defense strategy was to blur the edges between the real and the phony, and in particular, suggest that a possible scenario was that the entire medical industry would adopt Medicare billing standards, which would make the real losses more than $175 million. (There is a good discussion about this written as a comment to yesterday’s entry). Pulling away from the closed environment of the courtroom, the problem with this notion is that there was never a real fear that this type of change was going to occur in the medical industry, and there was never any documentation, at the time or since, that would support the $175 million as a real figure.
One of the major themes today was to ask questions about things where there could clearly be two meanings and two interpretations. Reasonable doubt thrives on multiple meanings. One instance of this came when Parkman asked why Owens had to write a letter to Scrushy to tell him about what is going on if Scrushy already knew. And Owens said the letter was about guidance, and not about the fraud. Semantics and diverging meanings was very much an issue in the recorded testimony, and since the beginning of his cross examination, Parkman has never strayed far from those tapes. The problem with the recordings is that Owens was using his wife as a cover story to get Scrushy to talk about the fraud. So when Scrushy says something like: “I’m just trying to figure out how you got into this.” Owens would say he was referring to the situation with his wife, but the defense would say he is talking about the fraud, with a special emphasis and focus on the word: “YOU.” “And when Owens agreed with Scrushy saying “You took them down the road,” the defense would again see the YOU, while the prosecution would see it as only an acknowledgement of the corporate structure. The issue is not about if Owens directed people to commit fraud, that has been given; but only if Scrushy directed Owens to commit fraud. But the more these lines are repeated, and emphasized, the more the original issue becomes murky and unclear.