The Bigger They Come, The Harder They Fall On You

Graduate students and other students of politics and government are wasting
their time taking seminars. They should be sitting in on white-collar crime
trials in federal court. Here in the United States District Court in Baltimore,
lobbyist Gerard E. Evans has been found guilty on nine counts of wire and
mail fraud, with the jury hung on two counts; his fellow defendant, legislator
Tony E. Fulton (D-Baltimore), was acquitted on five counts, with the jury
hung on six.  Evans is reputed to have been the top lobbyist in Maryland,
where lobbyists learn early to be all that they can be.

According to Bonsib, Evans’s firm, founded in 1994 with partner John R.
Stierhoff—who testified under a grant of immunity—grossed over a million
a year in 1996, 1997, and 1998. (Income tax returns from the period were
not presented in court, for either defendant.)

Fallout from the fraud conviction may not actually slow Evans down much.
As everyone comments, criminal charges are something of a tradition for
regional high-flyers; the previous top-grossing lobbyist, attorney Bruce
Bereano, was convicted and continued his lobbying activities, literally,
from the halfway house. Eventually he was also disbarred—not a feat any
ordinary man could pull off in Maryland—despite a roster of character references
and statements on his behalf in the Court of Appeals by the best-connected
political figures in Annapolis. Evans, however, has never passed the bar
in Maryland, becoming barred in Pennsylvania and then by waiver in the
District Court in DC.

Allegedly the defendants defrauded some of Evans’s corporate clients—several
paint and asbestos companies—by scaring them into thinking that politicians
here were on the verge of introducing market share liability legislation.
A market share bill, as the corporate lawyers emphasized on the stand,
would leave former manufacturers and sellers of lead-based paint substantially
less able to defend against litigation. Under current law, a plaintiff
wanting to sue for damages related to lead paint would have to prove what
company manufactured the lead paint ingested or breathed by individual
plaintiffs. Under the purported legislation, damages in a lawsuit would
be apportioned among the companies by current market share, as with tobacco.

The source of the market share concept, as more than one lawyer-witness
testified, was DES litigation, the host of cases involving pregnant women
who took DES to avoid morning sickness and consequently brought to term
babies with what one attorney called a “signature injury,” i.e. missing

Obviously scary stuff, and the companies reacted, by and through legal
counsel of their hardnosed reps, with fitting horror. A whole fictive scenario
was unrolled before their terrified eyes by their man on the scene, Evans,
including dramatis personae from upstairs and downstairs: Peter Angelos,
multi-million-dollar plaintiffs’ attorney, whose asbestos and tobacco litigation
among other pursuits enabled him to purchase the Orioles; popular former
Mayor Kurt Schmoke; and state Senator Paul Pinsky (D-22nd).

Scare figure Angelos is evidently a living legend well beyond the mid-Atlantic.
All the attorneys who testified on behalf of companies for the prosecution
detailed Evans’s having freely injected Angelos’s name into discussion.
The argument was that since Angelos is winding down asbestos cases (with
a mere 12,500 trials now bundled for trial in Baltimore), and since tobacco
has settled—three billion for the state and one billion for Angelos, unless
he cuts his take to half a billion, as Attorney General Joseph Curran would
like—he must be looking for other fertile fields for plaintiffs. Indeed,
Angelos has already filed lawsuits on lead paint. So he was nicely positioned
to serve as a bogeyman.

As to Schmoke, he testified by videotaped deposition that he had known
Fulton since their childhood in the same part of Baltimore, had kept in
touch over the years, and had contributed to Fulton’s campaigns. So it
would seem—to the paint companies—that a rather fire-breathing letter from
Fulton to Schmoke (allegedly drafted by Evans, for Fulton to send over
his signature) would command attention. Copies of the letter, calling for
the mayor’s office to act on lead paint hazards, were duly sent to the
paint companies by Evans. In the prosecution’s most dramatic testimony,
a young former employee of Evans & Stierhoff described Evans engaged in
what he called “creative lobbying,” i.e. cutting a fax line from an unrelated
message from the mayor’s office and attaching it to Fulton’s letter, to
hype Schmoke’s purported interest in a lead-paint bill.  Senator Pinsky
came with a different reputation, testifying to a concern for poor households
and working people, and adding a touchingly frank boast for inside the
Beltway: “I’ve probably received less money than almost anybody else in
the Senate.” To his credit, his name was mentioned, apparently feverishly,
in conversation and correspondence between the hapless corporations’ attorneys
and their paid lobbyist. Unlike Angelos and Schmoke, the disinterested
Pinsky figured as a bogeyman more because of his beliefs than because of
his position.

Three attorneys for the corporate victims (a phrase we do not read every
day)—Harry Lehman for Sherwin-Williams, Susan Pace for Glidden, and Timothy
Knaus for National Lead Industries—testified that they were induced to
pay sizable sums to Evans specifically by their fear of market share liability
legislation. That this legislation would have been wildly atypical for
the Free State, which has just made cable companies free to charge late
fees though no one enforces the companies to pay theirs, seems to have
occurred to no one. Evans claimed both in conversation and in writing (including
through the mail, which is where the feds come in), that Senator Pinsky
was having a market share bill drafted, that he was shopping it among his
colleagues, and even that he was doing so on behalf of Peter Angelos.

This legislation, for defraying some public costs of brain damage in children,
in Baltimore and elsewhere, who ingested chips of lead paint or breathed
in dust laden with lead, has virtually never been on the table in Maryland.
When Senator Sandy Rosenberg (D-Baltimore) finally introduced a market
share bill in the 2000 state legislature, it promptly died in the Judicial
Proceedings Committee—where matters of environmental or health concern
are sent to die, according to testimony—killed by unanimous vote. Responding
to Evans’s assertions, Pinsky testified that he had never had such a bill
drafted and had never introduced one. Schmoke also testified to having
had no meetings and to having taken no action on the concept. Angelos,
subpoenaed by the prosecution in the last week of trial, did not appear
on the stand.

Allegedly the paint companies were further softened to Evans’s inducements
by Fulton’s participation, although the federal jury found no direct connection.
First Fulton had a market share bill drafted, providing a copy to Evans
(only), who sent the copy to his clients. (The exact legal language is,
“for the purpose of executing and attempting to execute the scheme and
artifice to defraud, did knowingly and willfully cause to be transmitted
in interstate commerce by means of a wire communication, signs, signals
and sounds, that is, a facsimile memo from Annapolis . . .”) Fulton then
withdrew the bill a few days later, after lobbying by Evans—at the same
time sending Evans a letter extolling the latter’s advocacy for changing
his mind, a copy of which Evans also sent his clients. (Subsequently, prosecutors
allege, Evans arranged for Fulton to receive a $10,000 real estate commission
in the firm’s purchase of an Annapolis building.)

Children brain damaged by lead chips or particles develop learning disabilities
and behavioral problems, further burdening the juvenile-justice and family-law
systems, none too robust in the mid-Atlantic to begin with. It need hardly
be said that these problems have been around for years; still, as the corporate
reps testified repeatedly, the companies refuse to fund even certifiably
community-based programs for lead abatement and blood screening for children
(although they don’t oppose legislation for such programs, referred to
in court as “good legislation”), or even to donate to related charities.
 To be sure, the companies can still work in other directions, in a “three-pronged
strategy” of legislation-influencing, political contributions and donations
to charity designed to enhance their standing as “good corporate citizens”
(another phrase repeated). As elicited in testimony, specific recipients
of their largesse in Maryland in recent years have been the Assembly’s
Black Caucus—formerly headed by Delegate Fulton—and a duck decoy museum
on the Eastern shore, a pet project of another legislator.  By the way,
questioning also elicited that the Assembly did successfully pass a bill
in 1994 reducing landlords’ liability in connection with lead paint, with
the overlapping support of the Black Caucus and the Baltimore city delegation
among other groups.

Whether Delegate Fulton is a landlord did not come out. Meeting with press
after the trial, Assistant U. S. Attorney Dale P. Kelberman said that Fulton
has been a landlord but that he did not know whether he is now—this item
either a stone left unturned in the year-long FBI investigation, or another
X-marks-the-spot successfully excluded by the defense. Undisputedly Delegate
Fulton is a licensed real estate agent and broker, and by all courtroom
accounts his only sustained legislative effort on lead paint—that is, the
only concern manifested consistently and materially—has been with connected
with the issue of landlord liability. One of the more chilling moments
in the trial came in Harry Lehman’s off-the-cuff thumbnail sketch of Delegate
Fulton as provided by Evans: “Chair of the Assembly’s Black Caucus; wife
a pediatrician; some history of marital problems; three daughters in private
school [it turned out to be two]; sometimes conservative; police protection;
sometimes carried a weapon.”

When the hired guns ride into town for the showdown, and hire others to
help them, they come armed.  So, how did the public come out, in this trial?
Good news, up to a point: the good guys won one, or most of one, and the
truth did come out, or largely. The jury, which was attentive, diligent,
and businesslike, appropriately rejected Evans’s insinuations against other
persons, assigning responsibility for his actions where it belonged. (Predictably,
Evans’s lawyer said in opening that Pinsky had been “out to get my client
for a long time.”) The rather transparent smoke screen signified by “Angelos”
was repudiated.  Also, a qualified federal judge, Chief Judge J. Frederick
Motz, applied consistent courtroom discipline and meticulous attention.
Most motions were heard in chambers or over white noise at the bench—thwarting
the press—and final strikes in jury selection were submitted in writing
rather than in open court, but the defense seems to have been given ample
opportunities. On the other hand, if it wanted a sloppy jury, it didn’t
get one; it got at least one full row of note-takers.

Happily, both Bonsib and Fulton’s attorney, state GOP chair Richard Bennett,
modified their trial strategies over the course of the month. After the
first two weeks of trial, Bonsib somewhat ameliorated what one attorney
called the “classic defense by tedium”—mind numbing parsing, frequent mixing/shuffling
of papers, omitting to cite document numbers when referring to them with
lawyer-witnesses, and frequently pausing with the formulaic phrase “court’s
indulgence, your honor”—interspersed with his standard response, “Fair
enough,” in which he sounded like Dan Aykroyd on the old “Saturday Night
Live.” Farther in, he did what looks to a lay perspective like a better
job, given not that much of a defense. (Evans blaming a young African-American
office assistant, whose law school tuition was being paid by the firm,
for the cut-and-paste artifice, apparently did not sit well with the jury.
The prosecutor dispatched this one briskly in closing: “How about the James-Davis-did-it-all-by-himself
defense?”—"You going for that one?")

Another bright spot was the excellent job done on behalf of the public
by the prosecutor. Whatever efforts defense counsel made to throw Kelberman
off the track, if any, did not work; he never lost his focus, never left
out details in a rush to conquest, and did not over-emphasize points already
bolstered by repeated testimony—regardless of courtroom jokiness, moments
of candor, righteous indignation, murky personal exchanges or any other
Jane Austen-scaled weapons from the other arsenal. Speaking of saving money,
the Evans trial may actually keep some other trials out of court. With
Evans convicted of fraud, his corporate clients may be able to get restitution
through sentencing (September 14), instead of through civil litigation.
Restitution, as Kelberman pointed out, would have the effect of an award
in a future lawsuit, without the cost of a trial. As U. S. Attorney Lynne
A. Battaglia joked, “We’ll be the collection agency.”

The bigger picture, however, is that this trial laid out a road map of
legislation almost incontestably in the public interest—market share liability,
changing the cap on punitive damages, changing the statute of limitations
in product liability, and ending the concept of “comparative negligence.”
All these laws would give consumers back some redress, which explains why
the corporate reps are fighting on legislative turf around the country.