EWE & Jim Letten: Secret Deals for Guidry and Graham. Perdigao SOL

The last Edwin Edwards investigation and trial was a go for broke effort. EWE had beaten the Feds twice in court years earlier and passed into legend during his second corruption trial when he mixed drinks for bar patrons in the French Quarter with his lawyer one evening after the day’s court session had ended.

As a Hancock County guy who at the time identified himself as more of a Louisianian than Mississippian, (not an uncommon thing in Hancock County) I don’t know that I can adequately explain the public’s love affair with a man we all knew was a crook. What I do know is today, even former EWE rivals like Governor David Treen think he should be released from prison. As we dig into USA v Perdigao v Adams & Reese I’m beginning to understand why people could think Edwin Edwards was railroaded. Thanks to Belle’s monitoring of PACER we have posted Perdigao’s Amended Witness List to our Perdigao litigation page. The amendment contains exhibits including the Texas case of USA v Collins that provides some color.

To understand the explosive implications of the Perdigao’s allegations against US Attorney Letten we start with this column written in late April by Times Picayune columnist James Gill. I remember Mr Gill as a talented writer and bane of uptown bluebloods. He also boils Perdigao’s allegations against Jim Letten and Robert Guidry down to the nitty gritty:

The abiding mystery of the Edwards trial is how come Guidry got such a sweet deal. After copping a plea and becoming the star government witness, Guidry was certainly entitled to a break, although five months in a half-way house seemed remarkably lenient after all the sleazy deals he admitted.

But that was not the biggest favor the feds did for Guidry. The license he secured for the Treasure Chest in Kenner eventually put more than $100 million in Guidry’s pocket. He was ordered to make restitution of just $3.5 million.

Even more remarkable however is a few other things we know for certain about the relationship between Letten and Guidry. In addition to criminal immunity Letten testified he gave Guidry oral civil immunity thus saving him the trouble of the pesky State lawsuit seeking recovery of damaged caused by Guidry’s sleazy business dealings. The proof concerning this unusual arrangement according to Perdigao is in the transcript of the case State of Louisiana v Robert Guidry. Here is the salient and sensational quote beginning on the bottom of page 8 of Perdigao’s motion for Letten’s recusal:

Despite the clear language of the plea agreement which did not mention civil immunity, the U.S. Attorney testified that Guidry had been awarded civil immunity in addition to criminal immunity.

In the same proceeding, East Baton Rouge District Attorney Doug Moreau, who authorized Guidry’s state criminal immunity, contradicted the U.S. Attorney and testified that civil immunity was never discussed or contemplated. Although the district court, appellate court and Supreme Court of Louisiana held that the suit by the State could proceed against Guidry, the testimony of the U.S. Attorney provided the basis for removal of the case from the state court system to the federal district court, which dismissed the State of Louisiana’s claims against Guidry’s profits.

I can’t imagine the State of Louisiana was happy with this arrangement but then again it appears that for Mr. Letten, taxpayer money was no object when it came to his pursuit of EWE.

The original Perdigao witness list filing contained a teaser that Guidry was not the only criminal to profit from the Edwards prosecution. Page 5 of the original preliminary witness list contains this statement which indicates a pattern of secret Letten immunity deals:

Letten’s oral, non-public immunity deal with Guidry paralleled his oral, non-public immunity deal with Patrick Graham (another informant in the Edwards case) for which Letten was severely criticized by U.S.D.C. Judge Lynn N. Hughes.

I found the Texas case and Judge Hughes’ criticisms yesterday about the same time the amended witness list was filed. The amendment contained the exhibits missing from the original filing and frankly my jaw dropped when I read what Judge Hughes had to say about Letten’s handling of Graham. I direct our readers to page 32 of the amended witness list. Judge Hughes was not impressed with Graham’s credibility when she ordered the convictions of the former Texas DOC executive director James Collins and business owner Yank Berry reversed:

Patrick Graham is a thief and a tax evader. He was the government’s key witness in this case.

In May 1995, this court signed a $35,000,000 civil-fraud judgment against Graham. He had raised funds from various institutional investors to build prisons in Texas. These would be for-profit prisons. They were speculative: no contracts were in place for their use. The prisons did not meet Texas standards for prison construction and could not be sold. Graham, therefore, defaulted on interest payments to the bondholders, and the investors sued. Graham got $2,000,000 from the deal. He failed to pay taxes totaling $700,000. He would later be convicted for this, too.

In January 1996, Graham was arrested for stealing $150,000 from a Texas inmate’s wife. Graham had told her that he was an official at the prison, that Collins was corrupt, and that Graham and he would take bribes in exchange for helping her husband escape. He also said that other officials, like Wayne Scott, were in on the plan. Graham knew that these were lies.155 He was later convicted of first-degree theft and sentenced to ten years in prison.

Judge Hughes Continues:

Graham did not want to stay in Texas custody for his criminal conviction; he said that he “was not real pleased with it.” Graham contacted the United States Attorney for the Eastern District of Louisiana to make a deal. He offered to tell the government about his crimes and those of others in exchange for (a) custody in a federal prison in Louisiana and (b) immunity from prosecution for federal crimes involving Louisiana public officials in that state. Ultimately, Graham wanted to get into the witness protection program. At the time of trial, Jim Letten was working on that for him. Then, Letten was the First Assistant United States Attorney for the Eastern District of Louisiana. He is now the United States Attorney for that district.

Agents came from everywhere to talk to Graham. Some wanted to talk about Safeguard Technology, some wanted to talk about VitaPro, and some wanted to talk about other transactions. Graham changed his story to fit their needs……….

Graham’s assistance to the government seems to have benefitted him. The court learned that Graham spent less than three months in a Texas prison for his Texas conviction; he was taken to federal prison in Louisiana to serve his time there. In addition, by the time of the trial in this court, the government had placed no lien on Graham’s house for his failure to pay over a $1,000,000 in taxes and penalties.

In this district, Letten arranged for Graham to be charged with only a misdemeanor for his tax evasion of nearly $1,000,000. The government asked that he receive only probation – no imprisonment. Graham was sentenced to three months in prison. Letten has also not prosecuted Graham for his fraud involving one of Graham’s companies, Evergreen Global Resources.

Last, from 1997 until at least the time of trial, Graham had received $1.2 million in loans from companies that he controlled. The companies had no officers, and their only board member was Lutex Trust, a trust for which Lori Lero was the trustee. Graham signed no promissory notes, and he reported less than one-twelfth of it as income. The government has done nothing in response.

Having factually set up the background the Judge makes it clear she found Letten’s behavior with Graham unethical. In fact, on page 34, she politely labels him a liar:

The court learned that the government – Letten – had made an oral immunity deal with Graham; immunity deals are usually in writing. The court ordered the government to disclose fully the deals that it had struck with Graham. While other agencies were forthcoming, Letten resisted. He wanted to keep his deal with Graham secret. In December 1999, Letten told the prosecutor in Houston that he was not at all intervening in Graham’s Texas state prosecution to ask the judge for leniency; he only told that judge about Graham’s cooperation solely for the purpose of informing him. Letten rejected the idea that this was “any type of signal” that Graham should receive a reduced sentence. The facts are otherwise.

Three months after his letter to the prosecutor, Letten wrote the judge in that case and asked for a continuance of Graham’s sentencing so that he could be present to tell the court how Graham had assisted the federal government. He did this out of his “legal and moral obligations to Mr. Graham.” (emphasis added) Letten wanted the judge to give Graham probation for his first-degree felony, but the judge gave Graham ten years in prison. Ultimately, Graham received parole extraordinarily early from his prison sentence in Texas. The Federal Bureau of Investigation in New Orleans said that it did not help Graham with his release. Technically, it was correct. A retired F.B.I. agent from that division, however, did write a letter to the Texas parole board. Presumably, he acquired information on Graham through his professional, not personal, experience with him.

On the tax-fraud case in this court, Letten not only influenced the United States Attorney’s recommendations, but he also wrote the judge in that case to affect Graham’s sentence. It is clear that Letten’s efforts worked since the judge took into account Graham’s “significant level of cooperation” to “the U.S. Attorney’s offices in two districts.”

Despite his colleague’s inability to shoot straight, the prosecutor in this case immediately disclosed to the court Letten’s lack of candor and intervention with the Texas state court. When the court confronted Letten, he calmly said that his appearing in person in state court on behalf of Graham to ask for mercy was not a favor. Gary Cobe prosecuted this case. While the court has a view of the record that may differ from his, the court has no criticism of his work at all.

One explanation of Letten’s behavior would be that he was consumed by his pursuit of Edwin Edwards that clouded his better judgement. Somehow you gotta think he could have obtained Robert Guidry’s testimony under far better terms, including not allowing Mr Guidry to profit to the tune of almost $100 million dollars for his part in the Treasure Chest License Bribery Scheme and making him pay some restitution to the citizens of Louisiana for his role in public corruption.

Now we find out Letten hopped in bed with a sleazoid in Patrick Graham and allowed him also to profit from his illegal activities provided he could get his lies straight before he sat on the witness stand. Against this backdrop Jamie Perdigao’s explosive allegations against former US Attorney Eddie Jordan and current USA Jim Letten begin to gain traction. And given the events alleged by Perdigao we now know indeed occured, if Perdigao is also truthful that Guidry passed money to Bill Jefferson and the NOLA US Attorney’s office, we’re compelled to wonder not if Letten got a slice of the pie rather how much it totaled.

It is no wonder why this story is creating such a buzz in legal circles with our Louisiana friends. Before it is done there may be a full blown US Attorney scandal right here in Soggy Bottom accompanied by the implosion of a huge insurance defense firm in Adams & Reese.

sop