A Conflict of Interest Read online

  “None.”

  “Not a single one?”

  “No, sir. Not one share.”

  “What happened to those shares, Special Agent?” Pavin asks this as if he truly has no idea.

  “They were sold.”

  “Please tell the jury, Special Agent, the average share price at which OPM sold its position in Salminol.”

  Just as Pavin sprinkles his statement to the court with the words your Honor, he can’t help himself but refer to McNiven as Special Agent at every opportunity. I’m tempted to make the point on cross-examination that every single FBI agent is a special agent—there’s no one who’s just a regular agent—which indicates that McNiven might not be so special after all.

  “OPM sold at an average share price of $1.07.”

  “What was the average share price that OPM paid for those shares, Special Agent?”

  “A little more than nineteen cents.”

  “Special Agent McNiven, were you able to calculate the total profit that OPM made on its Salminol purchase and sales?”

  “$161,850,448.”

  Pavin lets the number speak for itself. After enough time has passed for the jury to recognize that Pavin considers this a strong point for the prosecution, he turns the witness over to me.

  My cross is short, focusing on the only things I know McNiven won’t fight me on. He concedes the share price of thinly traded securities—which he refers to as penny stocks whenever he can—sometimes rises quickly, but not before saying that such stocks are prime targets for illegal manipulation. He also has no choice but to acknowledge that Ohlig didn’t sell his personal holdings of Salminol, suffering an almost $4.5 million loss, but he counters by making the obvious point that Ohlig’s personal loss was more than offset by the enormous profit he earned through OPM.

  When I’m done, Judge Sullivan dismisses the jury, reminding them to stay clear of the media and to return by 9:30 the next morning. When the jury has left, she says, “Counsel, anything else for us to do today?”

  Pavin and I rise in unison and then say at the same time, “No,” with him then adding the “your Honor” part.

  “Very well,” Judge Sullivan says. “Enjoy your evening.”

  I chuckle to myself. Perhaps Pavin will, but I know I won’t. Today has not gone well, and I’m sure my client is going to tell me so as soon as he can.

  Back in the war room after court, it doesn’t take a mind reader to recognize that Ohlig is disgusted with me. It’s of little concern to me, however. The client’s ultimate opinion is invariably based solely on the result.

  “My guess is that tomorrow Pavin will do a few of the OPM brokers,” I tell Ohlig as he’s getting ready to leave for his hotel. “They’ll testify to the way the business ran, and my cross is going to be limited to establishing that they didn’t know anything was wrong with Salminol. I figure they’ll have to acknowledge that or else they’ll be admitting their own securities law violations.”

  “Make sure you ask them if I ever told them to lie,” Ohlig says. “They’ll say that not only did I never do that, but that I said that one lie and they were out on their asses.”

  “I’m not going to go there.” I say this firmly, not wanting to invite a debate on the subject. “Rule number one in cross-examination—don’t ask anything unless you’re positively sure of the answer. All we need is for one of these guys to say that they think you’ve sometimes crossed the ethical line and you’re toast.”

  Ohlig glares at me, holding the stare for a good twenty seconds before speaking. “Does the truth matter to you at all? I guarantee that if you ask them whether I ever told them to do anything they thought was dishonest, they’d say I didn’t.”

  I look in Abby’s direction. She knows better than to disagree with me in front of the client, but by not meeting my eyes that’s exactly what she’s doing.

  “The type of pressure the government has over them means they could say just about anything,” I reply. “For all we know, Pavin could be threatening that he’s going to bring a perjury indictment if they say anything he doesn’t like.”

  “It sounds like I’m not going to add anything,” Ohlig says, making little effort to mask his annoyance. “After all, it’s not like what I think matters to you anyway, Alex. I’m just the guy who’s going to end up in jail if you’re wrong.”

  Elizabeth is awake when I get home. We’ve barely spoken since the trial began. In fact, we’ve barely spoken since Abby and I had sex, which was seven days ago (but who’s counting). Some of that has to do with the late hours I’ve been keeping, which is par for the course when on trial, but it’s also because I’ve been more than happy to avoid Elizabeth. I fear that she’ll be able to see the betrayal on my face—not just for that one night, but of my continuing thoughts of Abby each and every day.

  “You’re up?” I say.

  “I wanted to know how you were doing.”

  “Not good. Hopefully things will get better when we put on our case.”

  “I didn’t mean about the case. How are you doing, Alex?”

  “I’m not sure. It’s harder than I thought. I really don’t like him.”

  “Why? I thought you believed he was innocent. Did something happen to change your mind?”

  Then I remember, I still haven’t told Elizabeth about my mother’s affair. I could tell her now, but I don’t, for the same reasons I didn’t tell her the first time.

  “It’s nothing specific,” I stammer, “it’s just that when his second-in-command flipped, I figured I must have been wrong about him.” It’s a lie, of course, but on the continuum of falsehoods I’ve told Elizabeth lately, it’s a minor one.

  “Well, no offense, Alex, but it’s hardly a shocker that your client ends up being guilty after claiming he was innocent. I don’t remember that ever upsetting you before, so why does it matter to you now?”

  “Because in those cases I still wanted to win, and here I’ve started to believe that Michael Ohlig deserves to be punished for what he did.”

  36

  A few years ago, I represented a twenty-two-year-old guy named Dominic Avallone who was arrested as part of what the Manhattan DA’s office called “a major crackdown on Wall Street.” The charge was securities fraud, but the underlying conduct was that he allowed his brokerage firm, a bucket shop called First Brooklyn Securities, to pay someone to take his Series 7 securities exam, the test that would-be brokers have to pass before dealing with the public. A Series 7 test is about as difficult as a driver’s license exam, but it took only a few minutes with Dominic for me to realize there was no way he could have passed the test on account of the fact that he could barely read.

  I tell this story because “Wall Street” is one of those terms that is awfully broad, ranging from the CEO of Goldman Sachs to guys like Dominic Avallone. More reputable brokerage firms may have their bad apples, but, by and large, their brokers are college educated, hardworking and honest. To become a broker at one of those places you not only need to get hired, which isn’t easy given the competition, but then you also need to survive a somewhat rigorous training program. As you go down the food chain to lesser prestigious brokerage houses, the competition for employment is less and, oftentimes, so is the training.

  OPM hired some brokers out of college, but most came from other walks of life. The training period was little more than reading a twenty-seven-page manual, and it’s likely no one ever actually did that.

  The government’s first witness on the second day of trial proves the point. His name is Lawrence Connors. He’s tall and gangly, still much more a boy than a man, and is dressed in a double-breasted suit and clip-on red suspenders, as if he takes his sartorial cues from the movie Wall Street.

  If McNiven’s resume prepared jurors to hear from a man of integrity, Connors’s background completely underscores just how unqualified OPM’s brokers were to sell stock to the public. The point is driven home right off the bat when Connors explains how he joined OPM after being fired a
s the assistant manager of a Sbarro’s at the food court in a Palm Beach mall.

  Pavin takes Connors through the day-to-day activity of a broker at OPM. I’ve heard the same story dozens of times through the years—the morning meetings in which a voice on a speakerphone (often from the office next door) tells the brokers about which stock is to be sold that day, the dissemination of the “research” about the stock, which the brokers then use to develop a sales pitch, and the 3-by-5 cards identifying prospective customers—the “leads,” as they’re called—which are treated like gold, but are actually little more than the phone numbers for the senior citizens in the area.

  “Was Salminol ever the stock of the day?” Pavin asks.

  “Yes.”

  “For more than one day?”

  “Yes. It was the stock of the day for more than a week,” Connors says.

  “Did you ever do any research yourself regarding Salminol?”

  “No.”

  “So you didn’t even run an internet search?”

  “We didn’t get the internet at the office,” Connors says, which causes some titters in the gallery, although Connors doesn’t seem to understand what they find amusing.

  “Then how did you know what to tell the customers?”

  “The research analysts told us what to say.”

  “How did they do that?”

  “They would tell us over the phone, and sometimes they would hand out written materials.”

  “Did they hand out written materials with regard to Salminol?”

  “No.”

  “Do you know why OPM didn’t want to commit to writing what it was telling customers with regard to Salminol?”

  “Objection,” I say, “assumes facts not in evidence regarding the implication that OPM did not want to commit to anything in writing.”

  Judge Sullivan seems startled, undoubtedly because I’ve objected so infrequently. This was a no-brainer, however.

  “I think you can ask a better question than that, Mr. Pavin,” she says, a common judicial dodge to avoid having to rule.

  “Thank you, your Honor,” Pavin says. “Do you know why there were not written materials regarding Salminol, Mr. Connors?”

  “No.”

  It’s one of the reasons that I don’t object much. There’s really little point, other than to awaken everyone in the courtroom to the fact that something is about to be said that’s damaging to your case. Here, all I’ve done is to get the jury to focus on the fact that OPM decided not to issue written materials on Salminol, and never explained why to its brokers.

  “Did you ever meet any of the research analysts?” Pavin asks.

  “No.”

  “Do you know whether they truly exist?”

  “They would put their names on the top of the research reports.”

  “Is that the only reason you assume that these people existed? Because you read a name at the top of a piece of paper?”

  “Yes,” Connors answers, not even smart enough to realize how foolish he sounds.

  I know that Pavin has left things out of his direct as little booby traps for me to step on during the cross. For instance, when I get Connors to confirm that Ohlig did not require that he or anyone else sell Salminol, he goes on to say that OPM offered four times the selling commission for it, so Ohlig didn’t have to say it. The questions about the pitch go the same way.

  “You decided what to tell prospective buyers, correct?” I ask.

  “I took it from the research reports.”

  “No one ever told you what to say, did they, Mr. Connors? There was not a script you read from, correct?”

  “No.”

  “And Mr. Connors, no one ever told you that you couldn’t do your own research, did they?”

  “No, but—”

  I don’t let him expand. It’s litigation 101. Never let a witness gain control of the examination. I wanted a straight “no,” and when I don’t get it, I need to ask a more limited question.

  “Did anyone at OPM ever tell you directly, Mr. Connors, you are not allowed to do your own research?”

  “No, but—”

  “Sir, the answer is simply yes or no,” I say, anticipating that he was going to remind me that the OPM brokers did not have internet capabilities on their system.

  I expect Pavin to object, but he doesn’t. This can only mean that he’s prepared Connors well enough to handle this on his own. Connors breaks eye contact with me and looks directly at Judge Sullivan. “I can’t answer yes or no, your Honor. They told us that everything we needed to know about Salminol was in the written research, and I couldn’t do my own research even if I wanted to because we didn’t get the internet at the office.”

  By the time I tell Judge Sullivan I have no further questions, I wonder if more damage has been done on my cross than Pavin did on direct.

  Ohlig looks at me as if there were no question about it.

  The next witness is another OPM broker, a guy named Tom Pittman, who provides pretty much the same testimony as Connors. In all, Pavin has six OPM brokers on his witness list, and so when he says he wants to call a third one, I ask Judge Sullivan for a sidebar.

  After we approach and Judge Sullivan nods in my direction, I say, “Your Honor, this broker’s testimony is just going to be duplicative of what Mr. Connors and Mr. Pittman just said. The government has put every OPM broker on its witness list, but there’s no reason for them to call additional brokers because their testimony is going to be duplicative of what the jury has already heard.”

  Judge Sullivan doesn’t respond, but from her body language, I can see that she agrees. Just like anyone else, she doesn’t want to hear the same thing over and over again.

  Then Pavin lays down a trump card.

  “Your Honor, we’d like to call one more broker witness. He’s got something new to add.”

  “What is it, Mr. Pavin?” Judge Sullivan asks, sounding skeptical. Lawyers are a lot like children in that, no matter how much you give them, they always want one more.

  “He’s going to say that Mr. Ohlig offered him a bribe in order to change his testimony.”

  “Well, Mr. Miller,” she says, peering down at me from the bench. “That’s something different, wouldn’t you say? Let’s take a ten-minute recess and then you can call your witness, Mr. Pavin.”

  “You couldn’t just send this one away on a Caribbean vacation?” I’m careful not to raise my voice too much because we’re in one of the annex rooms right outside the courtroom and the walls are thin. “You had to go all out and bribe this one?”

  Ohlig chuckles as if he’s amused by the joke.

  “There’s nothing funny about this, Michael! What do you think you’re doing? This is a serious crime you’ve committed. On top of which, I’m betting that Pavin is going to think I’m a co-conspirator. And call me crazy, but I’d rather not be indicted at this stage of my legal career.”

  “Can I offer something?” Abby says.

  “I wish you would,” Ohlig says, as calm as always. “I think Alex here is about to explode.”

  “Can’t we keep the evidence out on relevance grounds? Bribing a witness”—Abby looks at Ohlig—“allegedly bribing a witness isn’t evidence that Michael committed securities fraud.”

  “It is evidence of obstruction of justice, however,” I say.

  “So let Pavin bring those charges,” Abby counters. “But we can argue that it isn’t one of the counts of this indictment, and it’s unduly prejudicial under Rules 404 and 608.”

  Ohlig responds before I can. “Abby, you make the argument. Maybe you’ll have better luck on this one than Alex, since you, at least, seem interested in my defense.”

  “May we approach, your Honor,” I say as soon as we reenter the courtroom. The jury hasn’t been summoned yet, but I don’t want to have this discussion in front of the press.

  “What is it, Mr. Miller?” Judge Sullivan says, clearly annoyed that there’s going to be a further delay.

  �
�If we may approach.”

  “Come, but make it quick,” she says.

  As soon as we’re beside the bench, I tell her that we’d like to be heard on the relevance of the prosecution’s next witness.

  “Didn’t we already discuss this at the last sidebar?” Judge Sullivan says rather sternly. “Mr. Pavin has already proffered a theory of relevance that was accepted by this court.”

  “The relevancy objection we previously discussed concerned duplicative testimony,” I explain. “Now that the government has identified the new area that this witness is going to address, we would like to be heard about why the testimony should be excluded under the Federal Rules of Evidence.”

  “Make it quick, Mr. Miller.” Judge Sullivan sighs as if she’s got somewhere else she’s supposed to be.

  “Actually, Ms. Sloane is going to address the court on this one.”

  “Let’s hear it, Ms. Sloane.”

  “Thank you, your Honor,” Abby says. “Without conceding the truth of what this witness will say, testimony about an alleged bribe isn’t relevant to the crime at hand, but speaks to the commission of another crime, one with an extremely attenuated relationship to securities fraud. Pursuant to Federal Rules of Evidence 404 and 608, this kind of testimony is, at most, character evidence, which is inadmissible for the purposes of proving that the person acted in conformity therewith. To the extent the government claims it’s impeachment evidence, it would still be improper at this juncture of the proceedings because Mr. Ohlig has not testified and therefore there’s nothing to be impeached. Finally, if the government has evidence of the commission of another crime, they have an obligation to present such charges to a grand jury. They can’t end-run that requirement by introducing the evidence now in this trial.”

  Abby is nothing short of outstanding. Perhaps it’s because of the hold she has on me, but I can’t keep my eyes off her. She’s confident and in total control, and I’m embarrassed that it reminds me of how she was in bed.

  “Your Honor, this is an issue for the jury,” Pavin says when it’s his turn. “If they don’t believe the witness’s testimony that Mr. Ohlig offered him money if he recanted, then so be it. But if they do believe it, then it certainly shows a guilty state of mind by Mr. Ohlig.”