“Tim says he’s somehow working with Dickie Scruggs and that Scruggs and his firm have asked him to contact me about dismissing a lawsuit one of his former partners filed against him over some fees in one of their big tort cases.” I had heard there were several million-dollar fee squabbles involving Scruggs but didn’t know Henry had one in his court or just how big the money was. “A lawyer named Johnny Jones has sued Scruggs for allegedly shorting him $17 million on their fee arrangement. Grady Tollison represents Jones. The Daniel Coker firm represents Scruggs. They have moved to dismiss the case, and Tim wants me to grant their motion. But Tim is not even an attorney on the case. I’m sure the Daniel Coker people have no idea he’s come to see me. It’s a terrible situation.”
My mind went into trial-prep mode. I asked Henry what he had told Tim. In every similar case I’d had, when an honest public official was offered a bribe, the official always got angry and threw the person out of his office, leaving us no opportunity to gather evidence. I had lost too many promising cases that way. What had Henry done? “Well, John, I’m embarrassed to say it, but I just kind of froze up. I couldn’t say anything. I was speechless. I wanted to believe he hadn’t said it. Inside, I was so angry my thoughts were scrambled. I wondered who was really behind Tim’s approach to me. I just said nothing.”
I was relieved. The case was not blown. “So where did you leave it with him, Henry?” I asked cautiously. “Well, he just kept talking and I managed to kind of nod as he was leaving and told him I’d get back to him. I think he would talk to me about it again if we need to.” I told Henry we definitely needed to and asked if he would “wear a wire,” sounding like a TV show. He said, “I have my own pocket recorder I can use.” What a pleasure dealing with a professional. I asked Henry to sit down right away and write out everything he remembered that Tim had said, everything. He said he’d already started.
I began to explain to Henry what we both already knew: The legal rules on entrapment. Let Tim do the talking, just react as normally as you can, don’t push him, let him come to you. Don’t initiate any corrupt ideas. Let Tim make all the offers. Henry had already thought of all that. It was my impression at the time that the offer had taken place that very morning, and only later did I learn that it had happened a week or so earlier. In the meantime, Henry had sought the counsel of his fellow judges and a local assistant DA. Judge Andy Howorth, my neighbor, had suggested Henry go to me at the U.S. Attorney’s office. The case was too expensive for the county to handle and too political to take to the state attorney general, who would have been put in an impossible position with all the money and powerful players likely to be implicated if Dick Scruggs really was involved.
I told Henry we would contact the FBI, the federal agency with exclusive jurisdiction over corruption cases. Because of Henry’s office and the suspect’s position as a lawyer, we would have to coordinate closely our undercover investigation with the FBI and DOJ in Washington. Henry gave me his private cell phone number and home telephone. We agreed to stay in constant contact. We both knew it was going to be a long and tricky and highly publicized case, something neither of us looked forward to. Due its gravity, we decided to take this case straight to the supervising state FBI office in Jackson and its brand-new Special Agent in Charge, Frederick Brink, whom we had never met. Jim Greenlee, Tom Dawson, and I drove to Jackson for the encounter.
Fred Brink was a smooth, direct, sophisticated graduate of the U.S. Naval Academy. He seemed to accept us in good faith in all respects. Without our even asking, he assigned Bill Delaney, a classic old-style FBI agent, to the case. Bill was already working on the big $55 million public corruption case in our district involving the failed Mississippi Beef plant, a sensitive, politically tinged case, so his frequent appearances in our office would arouse no suspicions that he was also working on another case.
Based on what Henry had said, none of us knew if Dick Scruggs was really involved or whether Balducci was acting on his behalf. It could have been that Balducci was just freelancing and trying to get in good with Scruggs, hoping if he pulled it off by abusing his friendship with Henry that Scruggs would pay him for it and maybe associate him on other cases.
I began to contemplate Dick Scruggs. He had made hundreds of millions of dollars as a plaintiff’s lawyer on the Gulf Coast, moving to Oxford before Hurricane Katrina hit, planning to slow his lifestyle and enjoy his money. He was becoming well known locally as a philanthropist with both public and private charitable gifts. Since most of his money came from suing tobacco companies, he was seen as a regular Robin Hood, suing the big guys and helping the little ones. He was the only billionaire I knew, unless John Grisham was one (some claim Scruggs was technically not quite a billionaire, but close enough for me). I saw Dick frequently on the street. He was always friendly, and we had some good chats, often several times a week.
Dick seemed intrigued by criminal law, which he’d never practiced, and was always asking me about my more colorful cases. I liked him instinctively. We also knew each other because I had taught federal trial practice to his son, Zach, at Ole Miss five years earlier. Out of over a thousand students I’d taught over twenty-five years, Zach was easy to remember: he was the only billionaire’s son I’d taught. Zach was a clean-cut kid, popular with other students. In my class he prepared well but was low-key. In no way did he act like a spoiled billionaire’s son. When he moved to Oxford with his father, I saw him weekly on the Square at lunchtime and always enjoyed our encounters.
Zach once called me to say that Osama bin Laden’s sister-in-law Carmen had tried to retain his firm to represent her against Osama’s brother in a divorce and property settlement dispute. Zach said he told her they didn’t practice that kind of law. He joked at the time that he figured the Feds had her phone tapped and might have intercepted him and just wanted me to know they had nothing to do with such people. Later, when I read a fine book she wrote on her experiences, I wished I’d read it earlier and advised Zach to go ahead and take the case.
As I talked to Dick in our Oxford Square encounters, he asked me often about wine. My book, Thomas Jefferson on Wine, had appeared in November 2006 and was being positively talked about in Oxford. After all, not many small-town lawyers dabble in such esoteric subjects. Dick was getting ever more interested in wine. From John Grisham’s interesting book King of Torts it was well-known that several plaintiff’s lawyers on the Mississippi Gulf Coast were deeply into wine, and Dick seemed to have caught the bug. He asked if I would consider flying with him to Bordeaux and Burgundy to pick out some wines to stock the wine cellar he was building in his new home on the site of the old Hovious family house, one of the rare private residences actually on the Ole Miss campus. I told him I’d love to do it after I retired, which I had already promised my wife I would do in August 2007. He said he’d “put me on the meter” or pay me by the hour, but I said no, the trip and a few choice bottles would be payment enough.
The undercover phase of the Scruggs case went well, but slowly. We could not afford to press Balducci; it might spook him. And Henry was still hoping Tim would back off. Henry was often in court and Tim was often traveling, so poor Bill Delaney was constantly driving from Jackson to Oxford and back as they missed meeting after meeting. Bill’s equipment was great, however. The first recorded meeting produced one of the best undercover videos I’d ever seen. Bill stage-managed Henry’s office, placing a briefcase holding the camera facing the only other chair he’d left in the room, so Tim had to face directly into the camera. As a veteran trial lawyer, Henry made a perfect undercover operative. He asked Tim lots of questions without seeming to. Yet it was a constant struggle with his conscience over what he was doing to someone he’d considered a friend and protégé.
Of course we had bobbles. One time, when Henry agreed to go to lunch with Balducci, Tim’s partner, Steve Patterson, showed up with the firm’s investigator, obviously checking to see if Henry was for real. The audiotape wasn’t very good, with all the clinking of
glasses and clatter of knives and forks on plates, but it was good enough, and we could tell the suspects had bought Henry’s act.
The biggest problem for me was the delays. I had signed a written agreement with DOJ to retire on August 31, 2007, but every time there was to be a meeting, something happened to delay it. It was worse than an undercover drug case. We could never herd all the cats into one room at one time. We were becoming more convinced that Scruggs was actually involved to some extent but doubted we’d ever catch him. Our plan was to get Balducci cold on tape so that we could always convict him no matter what else happened but would not charge Scruggs unless we had a really solid case. If you try to kill the king of torts you had better succeed. Not only was Dick Scruggs a respected billionaire lawyer, but his brother-in-law was Trent Lott, one of the most powerful men in Washington, a United States senator, former Republican Majority Leader, and a high-profile, highly articulate regular on the Sunday talk show circuit. We couldn’t afford to go bear hunting with a switch. It would also put U.S. Attorney Jim Greenlee, a Republican appointee, on a serious hot seat. But Jim never flinched and always told us to treat the case as much as possible like any other case.
I began to feel anxious about my role in the case. After all, I was the one primarily responsible for getting the office involved in it. How could I retire right in the middle of it? I was happy in my job and proud of my career but was more tired every morning. From time to time, I had chest pains. I was worn out from the constant stress of the endless Mississippi Beef investigation and the intense public interest in it. The media wanted blood and expected miracles. And several politicians, who were innocent, were having their reputations tarnished for no reason but understandable public cynicism about our political system. People had no idea how convoluted the evidence was, and we had no way to explain it to them.
Beside Mississippi Beef, the Scruggs case was actually simple, and except for the human cost, it was exciting. But it was taking too long. Finally my retirement day came and I went happily, leaving the Scruggs case to veteran prosecutor Tom Dawson with lots of consulting by U.S. Attorney Jim Greenlee and our team of assistants. Our aces Bob Norman and Chad Lamar, often partners in their cases, were working the evidence hard with brilliant AUSA Dave Sanders, another of my former students, doing the heavy lifting on legal issues. I felt bad but knew I was leaving the case and the office in good hands. Then we suddenly started losing players faster than a college football team. Dave Sanders was named U.S. magistrate judge. Jimmy Maxwell, another rising star advocate, was appointed to the Mississippi Court of Appeals.
At least I was able to help solve one big problem before I left. One Monday I walked into Tom Dawson’s office. He had the longest face I’d ever seen. “It’s over. Henry has recused himself and withdrawn from the case.” Tom was depressed. Even the unflappable Bill Delaney looked concerned. I thought for a moment, and one simple thing came to mind: “I’ll call Henry.” When I asked him what happened, he said, “John, I have written a letter to the lawyers and the other judges and faxed it to them Friday saying I discovered I have a conflict of interest and have to withdraw.” Hm. “What was the conflict?” I asked. “One of my former law clerks now works for Daniel Coker, the law firm representing Scruggs. I saw the law clerk at a reception late last week and realized it.”
That didn’t sound right. I had personally tried scores of cases before Judge Keady, the federal judge I clerked for. Wanting to reassure Henry but also be respectful of his feelings, I asked him: “Have you read any cases on these conflicts?” I had guessed right. “John, I read cases all weekend. I now believe I don’t need to recuse myself after all. This is so embarrassing. I hope I didn’t just lose my nerve and blow the case.” I assured him he had not. The same keen sense of ethics that had caused him to pursue the investigation in the first place had made him think of recusal. Rather than just throwing Balducci out of his office, as most of us would have done, Henry had chosen the harder, better road. He had not taken the easy way out and would not do so this time either.
But I learned much later that I was mistaken as to his motives. The real reason Henry wanted out of the case was because the stress of his meetings with Tim had caused his heart defibrillator to go off during a meeting. Henry feared Tim would discover his wire. Henry’s wife also feared he would die of a heart attack. I didn’t learn till later that Henry had had bypass surgery and also wore a pacemaker, which he never told me. If I’d known he had such a bad heart, I probably would never have asked him to wear a wire. But the whole Scruggs case was full of twists like that.
Henry then volunteered, without my even asking, to simply “un-recuse” himself and fax the lawyers and his fellow judges another letter undoing the first one. When I went back and told Tom and Bill Delaney, they couldn’t believe it. Bill, who knew I felt guilty about leaving the case, made me feel better when he said, “John, you’ve done a good day’s work. This case was dead. Now you can retire with a clear conscience.” I retired as scheduled and spent six weeks with my wife in a little village in southwest France that she and my daughter Lydia had picked out the year before. I put the Scruggs case out of my mind almost entirely, not even e-mailing or calling home for updates.
When I got back to Oxford, I got one good night’s rest to sleep off the jet lag and headed for the office. Dawson had big news. “We’ve got it. Balducci just paid Henry in cash on videotape. He’s paying him again tomorrow. Bill Delaney is going to brace up Balducci with a video player outside Henry’s office and try to get him to cooperate.”
The confrontation was as smooth and simple as a routine drug case flip. After seeing and hearing himself on tape, Balducci simply said, “What do you want me to do?” Bill Delaney wired him up and sent him straight to Dick Scruggs. Although a shameful example for young lawyers, Balducci was a wonderful undercover operative. He caught Scruggs on tape agreeing to pay him back for a bribe Balducci had given Henry Lackey out of his own “slush fund.” Then things began to get complicated for me personally. Happily retired, I considered myself lucky to still be trusted to know about the case since I’d be a witness as to Henry’s initial statements to me and our original planning of the case. Then I suddenly got drawn back into the vortex of the undercover investigation and what would certainly be a big-time trial.
One morning I got a phone call from recently retired state chancery judge and former U.S. magistrate Norman Gillespie. “John boy,” Norman said. “We want you to join our new law firm.” He was retiring, unfortunately, to the firm of Patterson and Balducci. In an amazingly bold stroke, Balducci and former state auditor Steve Patterson had formed a new law firm with offices on K Street in Washington, D.C., and in New Albany and Oxford as well. The whole thing was right out of John Grisham.
Patterson was not even a lawyer, but the former elected state auditor and chairman of the Mississippi Democratic Party. He and Tim Balducci had formed their new law firm in Washington, D.C., where non-lawyers can legally be partners with lawyers. He and Balducci, with very little visible financing, had convinced several respected retired judges to serve as “Of Counsel” to the new firm. Being “Of Counsel” used to involve only retired partners of the firm who retained an office and use of a secretary part-time and drew a small stipend from the firm. They would serve mainly as business-getters or “rainmakers” and also as business-keepers, persuading old clients not to leave for other firms after their retirement. It was a fairly recent idea for firms to retain retired judges and senior lawyers from other firms. In most cases it was a good arrangement for all parties. In my case it was a quandary. Poor Norman Gillespie, a totally innocent bystander, had been sucked into the Scruggs case orbit and was unwittingly trying to bring me in too. I called FBI agent Bill Delaney right away and told him the deal. He was not surprised. “These guys think they can walk on water, John. Go ahead and meet with them, just let us know what happens.” When I told Tom Dawson he laughed out loud. “Hailman, you just can’t seem to get this retirement thing ri
ght, can you?”
I went to the lunch, which took place at the City Grocery, Oxford’s most prominent restaurant. Norman, Steve, and I sat at my preferred front table in the window looking out on the Square through tall French doors. It’s the best table not only because it has the best view, but also is by far the quietest. The thought did cross my mind that if I had been wearing a wire, this table would have been the quietest place to record conversations. Since it was Steve’s treat, I ordered a glass of expensive California Roussanne, glad to be retired and able to drink wine at lunch, which always made me too sleepy to concentrate on law afterward. Steve pitched the law firm to me, which, unfortunately, sounded great. They had fine offices near the White House in Washington and claimed partners in Zurich, Switzerland, and Caracas, Venezuela. I wouldn’t have to do any real work if I didn’t want to but would have a nice office above the old Duvall’s boutique on the Square in Oxford. “We just want to use your name and reputation to attract business,” Steve said.
In a way, it was a shame I couldn’t accept. But declining was a problem too. If I did it too abruptly, they might get suspicious. Just then Dick Scruggs and his retinue of young attorneys walked in. They looked surprised to see me with Patterson. Instead of coming over to shake hands and chat as always, Dick waved sort of wanly and took a seat at a table far in the back. He looked a little nervous, I thought. No doubt the idea of a retired federal corruption prosecutor sitting in the middle of Balducci and Patterson’s law firm in Oxford was a little unnerving. Patterson clearly had not run this idea past Dick Scruggs in advance. Then came the bigger surprise. After handing me a thick, impressive big-time law firm presentation folder with expensive individual pages on all the partners and their practices, Steve announced that Sara Biden, the wife of Senator Joseph Biden’s brother Jimmy, was joining the firm as a partner in the Washington office. Would this thing never end?
From Midnight to Guntown Page 22