Live Blog: Kwame Kilpatrick Trial Day 15 - Fox 2 News Headlines

Live Blog: Kwame Kilpatrick Trial Day 15



I'll be back in the morning.  The attorneys will have more discussion the am about how to address objections about introducing evidence.  the Defense is trying to keep as much out of the court record as possible.

M.L. Elrick will have a complete wrap up at 5 and 6, and don't forget to read his Takeaway tonight on

talk to you all in the morning.


And we're done for the day.  Rutherford is a stocky, feisty old SOB with silver hair, a gravelly baritone voice, and he appears to not suffer fools gladly.   Of all the witnesses so far he has been the most confidant on the stand.  He understand the exhibit numbering and called the exhibits by their catalogue numbers, even the judge has trouble keeping track of the at times.  But Rutherford is sharp as a tack and speaks what he believes and is not afraid to correct the prosecutor if he thinks he's out of line.  He's quite fun to watch on the witness stand.


Asked if he's have paid all this money if Kwame wasn't Mayor and he says no.  Pay Bernard? No.

Says he supposes he expected something in return.

asked if he needed access to Mayor for casino project, Rutherford say, "couldn't do it without him."

1:02 PM

BAck now.  Sowing $327,000 figure on screen and Rutherford confirms is the total of the checks he described.  Now we're looking at a list of checks paid to Maestro and Associates.

$427,275 total on screen.  Rutherford says it all came from his companies.  CAsh for suits and Vegas cash and Prize fight ticket are not on the chart.


Rutherford says yes the more than $100,000 total is correct.

Chutkow asks if total is what was paid to Kwame.  Thomas objects (because the payments were to PAC and Civic Fund) Judge sustains, Chutkow tries to rephrase, and now they're having a sidebar.


Now looking at more checks.  Rutherford identifies them as all the exhibits they've been talking about for 3 and a half hours and Chutkow introduces them as evidence.


Chutkow now asking about plea deal.  Rutherford could have been sentenced to 24-30 months but has actually been sentenced to 21 months for testifying.  Rutherford asked if he hoped his sentenced would be reduced further and he says "wouldn't you."

Judge can lower even more.  Rutherford says he hasn't really had any conversations or been promised anything by the government.

SAys he doesn't really know who makes the decision.


Chutkow now asking where money came from that he lavished on Kilpatrick.  Describes that each mental health patient in the care of his companies came with a price tag.  That might  add up to $2.8 million he says and that the company got a 20 percent administrative fee.

Says Wayne county health didn't care where that money went.


Chutkow asks where the money came from.  Rutherford says well we said the name DPR about a hundred times and that's my company.

asked how much money his for profit company made, says he'd hade to look at tax records, accounting statements, can't answer that right now.

SAys he got $275,000 a year but is very clear that this salary was not just for running the non profit but for several companies


Rutherford say Derrick met with a few people from City Council as well.

Rutherford says the Sands Hotel group was the second party interested in buying greektown.

Says the Mayor met with the Sands CEO in D.C.

Kwame Met with CAsino developer Sheldon Addison, in VEgas, who Rutherford says was the third richest man in the country to talk about the riverfront CAsino development.


Rutherford say Kwame sent Derrick Miller to the CAsino meetings and that he took Derrick to VEgas with him to meet with Herra's.  Met with CEO, CFO, and other raking employees.  Says Derrick was there and reported back to the Mayor.


Now talking about conversations with Kwame about Greektown CAsino, says building they wanted cost too much, and money they borrowed was too expensive, (a very precise way of saying the got a high interest rate.)  That it would be a good business to buy, but the owners thought it was worth than the buyers thought it was worth so they never got close on a price.


Now looking at checks to Next Vision Foundation run By Ayanna K.  couple of $5000 checks.  Sent employees to Halloween fundraiser.  SAys either Kwame of Ayanna called to ask for money.  Asked if it was the family connection and he answered, "absolutely."


Rutherford say the last check he paid to Bernard was in 2003 because Bernard told him about his community mental health board appointment and Rutherford says because he was part owner of Gateway Community services and he didn't think it fair and it would come up and it wouldn't be a good thing.  He hasn't said "conflict of interest"  but that's the term for it.


Rutherford is looking at exhibits and says there's a month missing and that the March Check is for $5,000 and combined with a $15,000 check would add up to their agreement.  SAys Bernard would not have had to ask him for the check he would have had it ready.  SAys he didn't particularly need his services but, because he was the Mayors father was one reason. the other was that you never knew when you might need someone.

Says he didn't need Bernard for running the homeless shelter,  I KNOW HOW TO RUN THE HOMELESS SHELTER.


Now showing a check from his company to Maestro and Associates for $10,000, Bernard's company.  I've seen these before.  Scott Lewis and I did  a story about these payments that linked Rutherford to Bernard.  When we finally tracked down Bernard to ask him he said there was nothing wrong with getting paid to be a consultant.  But he sure wasn't happy talking about it.  And we just heard Rutherford say he hired Bernard after a phone call from a Democratic operative named CAssandra Smith Gray and almost gleefully described how having the father of a sitting Mayor on the payroll would work to his advantage.


Chutkow asking about Rutherford helping Bernard set up his business.  Rutherford says it was a 30 second conversation, doesn't remember when.

This is following a very telling exchange between Chutkow and Rutherford where Rutherford stopped and said if we're going to get into that (hiring Bernard) let's start where it started and tell the truth about it...   Rutherford demonstrated he's a feisty old pugilist and not afraid to mix it up with the feds. 


Says having Bernard would be beneficial to him because he'd been in government and knew the bureaucrat that got things done, could call them.  Politicians had to re-elected every two years.


asked if he had conversation with Bernard about hiring him as consultant.  Rutherford says it was someone else that came up to him, that Bernard never asked him.  SAys he got a phone call from a mutual friend saying they needed to Get Bernard out of his Wayne County job because it wasn't good to have him there when his son was the mayor.  says he was told Bernard need $10,000 a month and Rutherford thought that was a good deal, he's a business man and it would be great to have the Mayor's Dad on the payroll.

Says he gave some thought and help and direction to set it up.


Chutkow now conferring with Bullotta, coming back to podium now.  ASks if Rutherford remembers being interviewed by IRS, says which of the hundred times.


Rutherford says they may have met when Bernard was a County Commissioner.  Say more acquaintance than friend. 


court is back in session.  again let me apologize for the technical troubles.  we appear to have lost the last hour of the blog.  Jon Rutherford is still on the stand.

Mark Chutkow asking how long he has known Bernard Kilpatrick.


Rutherford say he probably had conversations with Kwame about his contributions but doesn't remember specific days.

Now looking at checks.


Chutkow asks if Hertell was still Speaker and Rutherford says no he'd left.  (Hertell was term limited out)

Chutkow asks what understanding was that checks would be used for.  Rutherford say he'd only write the checks if Kwame was elected floor leader if Democrats won.  It was an understanding he had when he wrote the checks. 


Judge explains evidentiary matter.  Says the testimony about what Rutherford was told is not being offered for the truth but so they can understand what was in his mine.  Not that it's true, but explains his motivation.  Whether he was told it or not it's a matter of cross exam.  In other words the defense can try to show that Rutherford wasn't told something.  YOu'll hear this referred to from time to time as a Hobbs act issue which allows hearsay in certain situations like this.


Court is back in session.  Remember the Judge is going to give the jury instructions as soon as they are seated and settled in.


The overflow room on the first floor is conveniently located right across from the snack bar and right around the corner from the bathrooms.  I mention this because it has become the habit of the Defense teams to congregate on the first floor during breaks.  So I get a pretty good look at their moods just be stepping out the door.  Also, it's nice to grab a coffee when the testimony gets tedious.

So that's the set up.  While out in the hall talking with M.L. we say Kwame and Thomas walking by.  Usually Kwame hangs with Bobby, and sometimes Bobby and Bernard during the breaks.  But this time it was just Kwame and his attorney walking and talking softly.

The extortion chapter is a large part of the overall case.


Judge says she'll have to give jury instruction that this isn't being offered for the truth but only to show what was going through Rutherford's mind at the time.

okay, that's settled and the court is in recess for a few minutes.


Judge says that there are cases that support going "to state of mind" to allow hearsay exception but prosecution hasn't gotten to that point yet.


Okay, they're leaving the sound on so we'll stick around and see  what the argument is about.

Chutkow says Kwame would have control over money so he could curry favor to be elected house leader and that it's not being offered for truth but to show Rutherford's reason for engaging in the actions and motivation.

Thomas say Hertell has not an un indicted coconspirator and this would be hear-say.


Rutherford says he understood the fund was run by Kwame.  Thomas is objecting.  Judge says this was an objection raised yesterday and should be addresses.  Excusing Jury for 15 minutes so lawyers can argue their respective viewpoints on how the evidence should be introduced.  BAck in 15 minutes.


Looking at check now for 50,000 to 21st century fund.  State Democratic Party.  Jon says Hertell introduced him to folks from 21st and he donated to help democrats during that election cycle.


Jon says his company model was based on the Henry Ford Hospital model.  Like the x-ray part of the hospital being run by a separate company.

Chutkow now asking if his for profit company charged the non profit company rent.  Say his Friend Curtis Hertell introduced him to Kilpatrick.  That's former House Speaker Hertell.


Says he had contracts with Detroit - Wayne county mental health.  Chutkow asks if he also had for-profit companies.  Rutherford says yes. As I recall, one of the reasons Jon got in trouble was for "selling" a homeless shelter to himself then charging outrageous rent  which ended up being paid taxpayers.


Rutherford says he's currently unemployed but started as a high school coach and teacher, became a college basketball coach, went into housing managment then created Metro Emergency Services to help homeless women  and children in the late 80's or early 90's, financed it with his own money.  In ten years built it into a company that also provided services to mentally ill adults.  Says went belly up after newspaper article about a contribution he made to Kilpatrick.  I think he just said it was a $38 million a year company.


Jon Rutherford is up next.  He's the guy that ran a homeless shelter that provided emergency mental health services.  He and his assistant were indicted on numerous counts of income tax evasion, conspiracy and fraud.  The was accused of kicking back money to get contracts.  Bernard Kilpatrick was his "consultant."

The attorney are now in a sidebar discussing how certain evidence will be introduced.


Berger says he expects the Fund to have rules about what is reimbursable.  Thomas wants to know if it could be the case that the money could be used this way and Berger says it's possible.

Judge excuses Berger to return to New York to weep about the Yankees. Berger laughs and thanks the Judge.


Thomas up, what if Berger knew Kwame was under siege.  Berger says if the Funds bylaws said it was appropriate but other things unrelated to the Civic Fund would be inconsistent with the use he thought it was going to be used for.


Thomas has no further questions, thanks Berger and says go tigers.  general laughter in court.  Bullotta comes up and asks if Berber is a tigers fan and Berger say no he's a Yankees fan.

after the laughter subsides Bullotta asks if they'd have made the contribution knowing the money was going to be used the way it was.  Berger say no it wouldn't have been consistent with the companies criteria.


Thomas asks if he'd be reimbursed for expenses.  Berger says he thinks that a corporation would set it  own rules like his firm does and if it  was consistent with those purposes. 


Thomas asking if Civic Fund would have expenses related to employees, fund raising, and travel.  Berger says sure.


Thomas is bouncing back and forth between documents here.  Asks Berger if he had conversations with FBI agents.  Says he talked to special agent David Hunt in 2010 and Bullotta for a few minutes this morning.

Berger says Hunt just asked him about the contributions.

Thomas wants to know if it was the FBI that told him the  money was being used improperly.


Thomas asking about part that says educate voters.  Berger says who you vote for is political but the only thing he can say is the document also says civic Fund would help get out the vote.

Thomas now talking about the distinction between legislative issues and campaign.  Berger says agrees.


Thomas looking at "purpose" documents now.  Berger says he and his partners make political purposes and his understanding was it would not be used to political purposes.

Thomas reading part where it say providing information to residents about legislative issues>  Berger says he doesn't remember seeing this wording and is relying his conversations.

Berger says his overall understanding was that the money was education and civic purposes and would in no way be used for political purposes.


Thomas asking if he knows difference between 501c3 and 501c4 and Berger says not really.

Looking at contribution letter now.


Berger says what was described to him was a real  need because the city had financial issues.  Berger says he thought this was the vehicle by which the city of Detroit would benefit indirectly.


Thomas asks if $10,000 is a large amount to us but not unusual.  Berger says it's a significant amount but his firm does this often.

Thomas asks if donating money generally is improper and Berger says no.


Thomas on cross.  Wants to know how Berger was asked to donate money.  Berger says his firm represents pensions all over the world and since Detroit was in financial stress they were more than  happy to give back to the community.

Thomas asks again how it came to be that Berger was asked to donate.  Berger says he recalls the Pension fund attorney asking him to consider making contributions.


Bullotta asking if he believed any of the money was going to be used for personal purposes.  Berger says he believed the contributions were going to be used for civic and education purposes and that he absolutely did not believe it would be used for campaign purposes.


looking at the actual check now.  Berger says it's clearly a check from his firm.  It's entered into evidence.  Berger says he doesn't have a specific recollection but he would have been involved in the decision to make a second donation.  He's a lawyer and sounds like one on the stand.  This is  another $10,000 check to the Civic Fund and the City of Detroit because, as Berger says, that's what they understood the money was for.


Now looking at the check stub, the firm's evidence of the check.  Berger says he got it from the controller and gave it to the FBI.


looking at a letter from June 2006, written by firm to pension fund lawyer, "please find our contribution for $10,000."  It's the letter that accompanied the check, sent Fed Ex.


Looking at the "purposes" page.  Berger says he was specifically told that the Fund was for the benefit for the Citizens of Detroit and for education and similar purposes.


Berger is identifying documents related to the donation, the solicitation letter, a letter from his firm and other pages.

The letter says "needs a check for $10,000."


Berger works is an attorney and investigates securities fraud on behalf of investors.  the firm works for the Detroit Police and Fire pension fund.


One more witness on the civic fund, the judge tells the jury.  this is Max Berger, another contributor. 


The jury is coming in now.


"all rise"  Thomas asks Judge if she waited 2 hours In he rain last night wondering if the Tigers game was going to start.  The judge said she was in a suite and someone else was buying the beer so she was okay.

They'll be talking about the climate of fear at some point this morning.  Looks like Rutherford will be up this morning but first one final witness on the Civic Fund matter.


Kwame's defense attorney Jim Thomas ended the day yesterday asking a special agent for the IRS if she left it up to a secretary to find out if that fictitious Mayors Organization he'd mentioned a few days ago really existed.  The special agent gamely defended the secretary saying she was a part of the  investigative team.  Thomas scoffed disparagingly and said no further questions.  Makes me wonder if there are any secretaries on the Jury.  Also makes me wonder if he'd had HIS secretary find out the name of the organization maybe he would have gotten the name right.


All the defense attorneys are in the court room, except Jim Thomas and John Shea.  bobby Ferguson  and Victor Mercado are in but Kwame and Bernard Kilpatrick are not.  The prosecutors are chatting at their table, all except for Mike Bullotta.

 8:37 am

Good Morning from the Theodore Levin Federal Court House in downtown Detroit.  The prosecution is  starting a new chapter in the Kilpatrick trial today, the extortion chapter.

-Ken Martinek is Senior Producer -Investigations for Fox 2 News

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