The Fall of the House of Zeus

by Curtis Wilkie

  Ghosts of Mississippi—Bobby DeLaughter, portrayed by Alec Baldwin as the hero in Rob Reiner’s 1996 film dealing with the conviction of civil rights–era assassin Byron De La Beckwith, walks from federal court twelve years later following his own arraignment in a judicial bribery case. (photo credit i15.4)

  “I’d cut my own throat for you.”—Even as he assured Joey Langston and Steve Patterson that he would protect them, former Hinds County district attorney Ed Peters prepared to give evidence against them to federal authorities. (photo credit i15.4)

  “A Greek tragedy.”—U.S. attorney Jim Greenlee gave a classical description to his account at an Oxford press conference of Dick Scruggs’s involvement in a judicial bribery case. (photo credit i15.5)

  “A monster that we were dealing with.”—State judge Henry Lackey, the key witness in the case against Scruggs, referred to him repeatedly as a “monster.” (photo credit i15.5)

  “You’ve had your chance to respond.”—U.S. district judge Neal Biggers, who presided over much of the case against Scruggs, was known as “Maximum Neal”—even by his admirers—for his stern rulings. (photo credit i15.5)

  “You would be out on your ass.”—Johnny Jones, once a partner in Scruggs Katrina Group, was threatened with expulsion from the legal team and subsequently sued Scruggs and others. (photo credit i15.5)

  “I’ve taken care of my problem.”—Joey Langston (left) decided he had no choice but to plead guilty. After receiving a three-year prison sentence, he walked from the federal courthouse with his attorney Tony Farese. (photo credit i15.6)

  “An embarrassed man.”—Steve Patterson on his way to another court appearance in Oxford. (photo credit i15.6)

  The Insider—On the set of Michael Mann’s 1999 film, shot in part in the Scruggs’s Pascagoula home, life imitates Hollywood as Scruggs, 60 Minutes producer Lowell Bergman, and CBS correspondent Mike Wallace—all portrayed as characters in the movie—enjoy a laugh. (photo credit i15.6a)

  “This ain’t my first rodeo.”—Attorney Tim Balducci insisted that he had been involved with Scruggs in other scandalous activities. (photo credit i15.7)

  A “childish” and “hurtful” advertisement—Insurance Commissioner George Dale blamed his defeat in the 2007 election on this full-page ad, placed in Mississippi newspapers by Scruggs.

  “He has so much to offer society.”—Robert Khayat (center), chancellor of Ole Miss, annoyed Judge Biggers when he suggested leniency for Scruggs (right). Before the case developed, the two old friends from the Gulf Coast met with a visiting Dan Rather on the Ole Miss campus. (photo credit i15.7)

  “He knows a lot of people.”—P. L. Blake, one of the stealthiest players in a political organization that has had influence in Mississippi for decades. (photo credit i15.8)

  “Their family could not survive without him for a decade.”—After urging her husband to plead guilty to a lesser charge rather than face the possibility of a harsh sentence at the end of a trial, Amy Scruggs, six months pregnant, hosted a farewell party for Zach before he left for prison. Their daughter, Augusta, plays at the left. (photo credit i15.8a)

  “I had to stand there … ​and take an ass-whipping.”—On his way to sentencing in federal court, Dick Scruggs is accompanied by his chief attorney, John Keker (left), son Zach (rear), and wife, Diane. (photo credit i15.8b)

  CHAPTER 16

  During the early stages of the investigation, the FBI relied upon Judge Lackey to ensure that his telephone calls with Balducci were recorded and that sophisticated equipment installed in his office captured Balducci’s visits on videotape. Now it was necessary to go a step further.

  Four days after Balducci met with Lackey, Tom Dawson of the U.S. Attorney’s Office applied for authorization for the FBI to begin intercepting all calls made over Balducci’s cell phone. The request went to the senior federal judge for Mississippi’s Northern District, Neal Biggers, and for the purpose of the prosecution the case could not have gone into better hands.

  Biggers was seventy-two and had a reputation as a stern jurist. More important to the federal authorities, the judge had a background as a prosecutor himself. He had served as a county prosecutor in his home town of Corinth shortly after getting his law degree from Ole Miss in 1963, and he later served two terms as a district attorney in northeast Mississippi, handling myriad criminal prosecutions in a region with a long history of redneck gangsters. Corinth, a crossroads city that had been fought over in the apocalyptic Civil War battle at nearby Shiloh, lay on the Tennessee border, and a murderous band of bootleggers and gamblers had operated in the area for years. Just across the state line, Sheriff Buford Pusser, the hero of the movie Walking Tall, had flirted and fought with the mob before his death. Biggers was no stranger to thugs, and he had little sympathy for them.

  There was another aspect to Biggers’s record that would be helpful to the federal investigators. Before he became a federal judge, he had served for almost ten years as a state circuit judge—the same position that Lackey held—and he could be sure to be insulted and indignant at any attempt to undermine the sanctity of the office.

  On September 25, Biggers signed an order authorizing the FBI to begin tapping Balducci’s phone. Almost immediately, it produced results.

  One of the first recorded calls involved an effort by Patterson and Balducci to make a name for themselves in Fred Thompson’s campaign for the Republican presidential nomination. Hedging their bet on Biden, the pair funneled a sizable contribution to Thompson through a third party and wanted to be represented at an upcoming Thompson fund-raiser in the Mississippi Delta by Balducci’s father, a banker in the area.

  Patterson urged his associate to ask the elder Balducci to attend the event and “to look up Tommy Anderson and tell him who he is” by identifying himself as the father of Patterson’s partner.

  Patterson said he had just “talked to Tommy” and knew that Anderson would be with Thompson at the party.

  In the years since Jim Eastland had passed from the scene, the dark side of the Force had become, if nothing else, bipartisan.

  Before nine o’clock on the morning of Thursday, September 27, Patterson called his partner as Balducci, who had been up early, drove between Oxford and Calhoun City.

  “Since you’re stopping by there to see Dickie,” Patterson said, there was something Balducci should know. “I mentioned very cryptically to P.L. one day last week that I had a pretty good problem that I had solved, and I was gonna go ahead and solve it.” Patterson said he had asked Blake, “What should I do?” and Blake had replied, “Solve it, and if you need help, let me know.”

  Balducci told Patterson he planned to tell Scruggs that “I’ve taken care of something you and I have gotten handled, and I was gonna get you to talk to P.L. and let P.L. visit with him at some point.”

  “I’ve already done that,” Patterson said. “P.L. doesn’t know what it’s about. He just knows the amount.”

  “What’d you tell him?” Balducci asked.

  “Forty.”

  “So you didn’t pad it?”

  “No.”

  “Great job,” Balducci said. “Way to go.”

  “Yeah,” said Patterson. “I just told him the truth.”

  Patterson said he asked Blake, “Do I go ahead and take care of it or what?” And Blake told him, “Yeah, go ahead and take care of it.” Patterson said he assured Blake, “We’ve already taken care of half of it.”

  Balducci, bearing $20,000 in cash and en route to Lackey’s office, told Patterson that he would “reinforce that this morning.” He added that he had already stopped by Scruggs’s office “to pick up that thing Sid had gotten for me,” a reference to the order Scruggs’s associate was supposed to be preparing for Lackey. Balducci told his partner he would return to Oxford after meeting with Judge Lackey and talk to Scruggs.

  “I’m gonna lead with this issue,” Balducci said. Then he would ask Scruggs to make two calls that would serve as a blessing for their dream firm, the a
ssociation they intended to call Patterson, Balducci and Biden.

  The pair had become deeply involved in negotiations with Senator Biden’s brother, Jim, whose wife, Sara, was a lawyer and could lend the Biden name to the law firm. They wanted to add other big names to their masthead.

  “Mention Ieyoub to him,” Patterson suggested, speaking of the former attorney general of Louisiana, Richard Ieyoub, whom Patterson had approached about lending his name to the group. “See what his reaction is. I think it’ll be positive.”

  He asked Balducci if he had heard yet from another contact named Zeke Reyna, a Texas lawyer whom they were counting on to send $500,000 to buy a share of a mass tort case.

  “The motherfucker never called me back.”

  A half hour later, Balducci was in Lackey’s office. The judge observed that his visitor was “traveling mighty early this morning.”

  “Oh, man,” Balducci said, “I got things rolling, rocking and rolling.” He reported that Patterson was still sore from surgery. “He’s being kind of a baby about it. I think he’s playing up his sympathy thing.” He said he had told Patterson “you better get your big ass up and rolling” because they had an important black-tie dinner to attend in Washington that weekend. It was an event where they planned to meet with members of the Biden family to try to enlist a prominent black minister from Boston, Charles Stith, as an associate of their firm. Stith had served as ambassador to Tanzania during the Clinton administration.

  After more small talk, Lackey sighed deeply and opened the unpleasant subject. “Let me tell you,” he said, “I don’t want a nickel of your money, Tim.”

  “I know that, Judge.”

  “And if this is not coming back to you, if it’s not Mr. Scruggs’s money, I don’t want a nickel of it because it’s not gonna do Tim any good, and he’s the one that I’m trying to help.”

  “Don’t worry about that,” Balducci told him. “All that’s taken care of.”

  Lackey sighed again. “This is my first trip, and I know you think I’m a complete horse’s ass.”

  “Absolutely not!” Balducci interjected.

  “And I feel lower than whale shit, to tell you the truth,” the judge continued.

  “I’m just glad I’m in a position to help you, Judge,” Balducci said and whispered conspiratorially, “This is between me and you—and just between me and you. There ain’t another soul in the world that knows about this. Okay? And this is taken care of.”

  Lackey seemed bothered about the note of confidentiality, the absence of Scruggs’s name in the agreement with Balducci. So Lackey said, “I would think Mr. Scruggs would have to know something.”

  “Here’s how it works,” Balducci replied, taking satisfaction in lecturing his mentor on the unsavory ways of the world. “Just so you’ll have some understanding of how it works, there will come a time where I’ll just sit him down in private and tell him that I solved a problem for him. That he had a problem that needed solving, and that he needs to take care of the problem that I solved for him. That’s how that’ll work. So don’t worry about any of this.”

  “All right,” Lackey said. But he still had concerns. “There’s one other thing that I’ve heard about over the years, that when a substantial amount of cash is withdrawn, you have to sign …”

  “This money didn’t come from a bank,” Balducci said. “Judge, I’ve been around long enough to know—and I’ve been involved in enough to know over time—that you always gotta have a slush fund.”

  “Yeah.”

  “You can’t have gotten where I’ve gotten in my life at this point and not know that sooner or later things come up that you gotta take care of, and you need a slush fund.”

  Lackey asked to see a copy of the order that would send the Jones case to arbitration. Balducci produced the document, which he described as “pretty straight.” Then he laid an envelope containing $20,000 in cash on Lackey’s desk.

  “Lord have mercy,” the judge exclaimed.

  “You good for a couple more weeks, right?” Balducci asked. The $20,000 represented half of the payoff to Lackey. He believed it would keep Lackey’s debtors at bay until the remainder arrived.

  “Let me ask you,” said Lackey, “aren’t no serial numbers or nothing traced on this doggone …”

  “Absolutely not.”

  Lackey fretted again over the situation. To calm him, Balducci said, “This is just business, Judge. You’re in a position to help me. I’m in a position to help you. There’s no reason why we shouldn’t help each other.”

  The judge listened as Balducci explained there was no urgency to issue the order. Then he spoke quietly. “Tim, you’ve always been special to me.”

  “I know, Judge. This doesn’t affect our friendship. It doesn’t affect the way I think of you and my fondness for you … It would break my heart if I knew that you were without options to get the help you needed,” Balducci said. “You taught me how to practice law as much as anybody, so I owe you a great debt of gratitude.”

  Lackey felt it was necessary to bring up Scruggs’s name again. “Whenever you tell Mr. Scruggs. Or Dickie or whatever. Dick—whatever I should call him. I don’t know what I should call him. Don’t even know how old he is. I know I’m older than he is because I’m older than dirt. But you tell him this is a first-time venture for me.”

  “He’s not even involved at that level, Judge,” Balducci said. “He’s not involved in a direct manner. Doesn’t want to be. Doesn’t need to be.”

  Once again, it seemed as though an explicit connection to Scruggs was slipping away.

  “Well, he’s a powerful fellow, I know.”

  “He knows how things work,” Balducci agreed. “You don’t climb the mountain he’s climbed without cutting a corner here and there.”

  “Yeah,” said the judge. “All right.”

  “It will be fine because I will tell him, and he trusts me implicitly. Listen: this ain’t my first rodeo with Scruggs.”

  · · ·

  Lackey had another entry for the journal the prosecutors wanted him to keep.

  “As Tim walked out of the office,” he wrote, “I felt so forlorn and sad that our profession had come to this, that a young man of Tim’s ability would be this cowardly and stoop this low at the behest of scum he is trying to help just so he can add another dollar to his pile.”

  Driving back to Oxford, Balducci got a call from Jim Biden. They talked about the two telephone calls they wanted Scruggs to make. In one, Scruggs would call Jim Biden and express his support for the Patterson, Balducci and Biden firm; ideally, he might even agree to have his name used on letterhead as an investor in joint ventures. Scruggs’s name carried clout, not only in the South, but also in Washington. In the other call, Balducci said he would ask Scruggs to vouch for the group with Gabor Ondo, a Swiss attorney who might be helpful in securing lucrative international deals.

  “That would be absolutely perfect,” Jim Biden said.

  Shortly before noon, as soon as Balducci left Scruggs’s office in Oxford, he called his partner. They had an extraordinary exchange. Some of the people who knew them felt they were an unlikely pair, the slightly built Balducci and the grossly overweight Patterson, a modern Mutt and Jeff. But in this talk, they delivered a low-comedy routine worthy of Abbott and Costello.

  After Patterson answered the call, Balducci had an instruction.

  “Repeat after me: You’re the man.”

  “I’m the man.”

  “No! I’M the man.”

  “Oh, you the man?”

  “I’m the man.”

  “You the man.”

  “I’m the man. Say it one more time.”

  “You the man.”

  “There you go.”

  “You the man.”

  “Say it like you mean it.”

  “You the man!”

  Balducci sounded exhilarated. “All right! Done! Handled! All is well!”

  Patterson laughed. “What’s done? And wh
at’s handled? And what’s ‘all is well’?”

  “All of it,” Balducci shouted.

  “There’s a lot to handle.”

  “I know.”

  “And there’s a lot that ain’t well,” Patterson said.

  Balducci refused to be discouraged. “Well, what I can tell you is from this trip this morning, all is done and all is handled and all is well. Top to bottom. Soup to nuts.”

  “Including Oxford?” Patterson asked.

  “Yep. Everything.”

  “Calls made?”

  “Calls are made. Everything’s great. Follow-up has been done by me, just now, touching everybody.”

  “Was he aware of what we were doing?” Patterson asked of Scruggs. “Could you tell if P.L. had talked to him?”

  “I asked him, and he said P.L. had not talked to him. I said, well, he’s going to be giving you a call here soon.”

  “Okay.”

  Patterson asked about the two calls they wanted Scruggs to make. “Did he talk to Jimmy?” He was referring to Jim Biden.

  “He left him a message. I was sitting right there and he left him the appropriate message. I mean, he took the pledge, put his foot on base. All nine yards.”

  Balducci said he had just called Biden to tell him of Scruggs’s message.

  Patterson wanted to know if Scruggs had talked to Ondo, the Swiss contact.

  “He left him a message. I told Jimmy that he talked to him. But he actually left him a message.”

  “Good enough,” Patterson said.

  “Same thing.”

  “You da man.”