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Durham attorney vows to appeal guilty verdict

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An attorney for convicted fraud mastermind Tim Durham vowed Thursday to appeal the case to the U.S. Supreme Court if necessary to prove his client did nothing wrong.

Attorneys for Jim Cochran and Rick Snow likely will follow suit in the coming months after a federal jury on Wednesday evening returned a guilty verdict on all 12 felony counts for Durham, eight of 12 for Cochran and five of 12 for Snow.

The government had accused the men of running Ohio-based Fair Finance as a Ponzi scheme that stole more than $200 million from 5,000 Ohio investors who purchased investment certificates from the consumer-loan company.

Durham attorney John Tompkins said he will review the trial record in the next few weeks but expects his appeal will focus on what he claims were improper government wiretaps of Durham phone conversations with Cochran and Snow.

Tompkins tried to keep the jury from hearing the recordings — which were key to the government's case — first by claiming they were obtained without probable cause and later by saying the government ignored segments that cast Durham in a more positive light when it edited 1,800 conversations down to just 19 snippets.

He also plans to take another look at comments made by a fellow defense attorney that led Tompkins to ask for a mistrial shortly before the case went to the jury.

U.S. Attorney Joe Hogsett said his team will do whatever it takes to defend the jury's ruling.

"Many of the defense objections that were raised at trial frankly echoed their objections filed with the court prior to trial," Hogsett said in an interview after the ruling Wednesday. "We will vigorously defend this case on appeal."

Veteran Indianapolis defense attorney Bob Hammerle called it a "certainty" that Durham, Cochran and Snow will appeal the convictions because that's "the only course of action left to them."

Hammerle said it is very likely the convictions will be upheld on appeal, noting that even the best appellate lawyers in the country don't approach the Major League Baseball-record .367 lifetime batting average of the legendary slugger Ty Cobb.

"No matter who you are, the odds are you're going to lose four out of every five appeals," Hammerle said.

The defense attorneys weren't alone in considering a potential appeal as the trial progressed. The possibility also influenced the prosecution's case, Hammerle said.

The court reserved a full three weeks for the trial, but the prosecution led by assistant U.S. Attorney Winfield Ong wound up using only six days to present its case.

"Mr. Ong is very good good as his analysis," Hammerle said. "He wanted to put out evidence that clearly shows what Durham did, but also not take a chance of creating problems on appeal."

Hammerle also noted Judge Jane Magnus-Stinson is known for being thorough and careful to avoid traps that can support appeals of convictions delivered in her courtroom.

Tompkins acknowledged the odds are long for a successful appeal but "every case really should be judged on its own merits." The appeal would start with the U.S. Court of Appeals, 7th District, in Chicago.

He planned to meet with Durham at the Marion County Jail on Thursday to discuss their next moves.

The first priority for Tompkins — along with Cochran attorney Bill Dazey and Snow attorney Jeffrey Baldwin — is preparing for a hearing Monday at which Magnus-Stinson will determine whether the men should be released on home detention until a sentencing hearing in the next few months, where they would be entitled to call character witnesses.

The judge will determine prison sentences, which could amount to life in prison. Federal rules require inmates to serve at least 85 percent of their sentence even with good behavior. Under federal guidelines, the maximum for Durham's 12 convictions is 225 years.

Tompkins noted that several factors can be considered in sentencing, which is "very discretionary," but he said a sentence that amounts to life in prison is a "realistic possibility" for his client.

A New York judge in 2009 gave Bernie Madoff, who ran a $65 billion Ponzi scheme, a record 150-year sentence, though Madoff agreed to plead guilty before a trial. A judge in Houston last week gave R. Allen Stanford, who ran a $7 billion Ponzi scheme, a 110-year sentence.

For comparison, Madoff's scheme involved a dollar figure 325 times larger than the roughly $200 million fraud at Fair Finance.

Tompkins expects his appeal will focus on the government wiretaps that played a key role in the case against his client, but he's also looking for grounds in an exchange that led him to ask the judge for a mistrial before the case went to the jury Wednesday.

His concern: Cochran attorney Bill Dazey in his closing argument Tuesday had gone "too far."

Dazey left many in the courtroom including the other attorneys with the impression he had acknowledged there was a fraud at Fair Finance but that his client did not know it was happening.

"There was a scheme to defraud," Dazey said, but Durham did not clue in Cochran on the plan.

Tompkins argued the comment violated a trial rule that bars attorneys from stating personal opinions.

But a review of the record in open court Wednesday showed Dazey intended the statement as a hypothetical, suggesting that if the jury decided there was fraud, they should consider whether Cochran knew about it. A long pause between the "if" and the rest of his statement led many — including a prosecuting attorney who referenced Dazey's statement in his closing — to misinterpret.

The judge denied Tompkins' motion before calling in the jury to offer final instructions on their deliberations.

The U.S. Attorney's Office offered six days of testimony, thousands of pages of documents and recordings from FBI wiretaps as it tried to convince jurors the defendants ran Fair Finance as a Ponzi scheme. Prosecutors said the defendants gutted Fair by doling out tens of millions of dollars in related-party loans to Durham, Cochran, their friends and their failing businesses. Those loans were never repaid.

Defense attorneys blamed the 2009 collapse of the consumer-loan company on a "perfect storm" of a bad economy, bad press and newly skeptical Ohio regulators.

Defense presentations lasted less than two hours and did not include testimony from Durham or his co-defendants.

"I didn't get the picture across clearly enough," Tompkins said Thursday. "That's always disappointing."

An archive of IBJ's coverage of Tim Durham and Fair Finance is available here.

 

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  1. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  2. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  3. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  4. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  5. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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