I'll Take Care of You

by Caitlin Rother

  As they reviewed her activities the night of the murder once more, she mentioned that “we” left the soccer game around 8:00 P.M. However, the detectives apparently didn’t catch her slip of the tongue, perhaps because she didn’t mention with whom she had left.

  Pressed for more details about her role in Bill’s finances, she said that since they’d been together, Bill had given her increasing control over his money, including making her a trustee of one of his accounts.

  Jacob Horowitz, she said, was one of Bill’s former scientist employees who had helped Bill develop his blood-plasma separator. After an internal dispute with Horowitz, Bill and his partners bought out Horowitz, then sold the company. Bill had been receiving royalties from that sale, but several “nuisance” suits by Horowitz had blocked the flow of money, she said. Just recently, however, Bill finally heard he’d won the legal battle.

  His Swiss bank account was the only one she didn’t know much about, but she thought it had been established because of concerns about the recent IRS audit. Elaborating on most of his five life insurance policies, she said one was for the trust, one was for the family, one was for the business, and one named her as the beneficiary. But she claimed not to know the value of the payouts, which detectives later learned came to a total of $9 million.

  They also learned that Bill had taken Kevin out of his will, apparently because Kevin’s government-funded medical costs would no longer be covered if he came into an influx of money. With this in mind, Bill had set up a special-needs trust to take care of Kevin’s medical costs and monthly bills. This would also continue his eligibility for public-assistance programs, such as Dial-a-ride and speech therapy programs, which were important because Kevin had already capped out his insurance after the accident. The trust was designed to kick in if and when Bill died.

  Nanette told detectives that she’d been concerned about Bill’s recent dealings in the gun market, and she gave them the name of his gun dealer.

  Asked about Bill’s usual habits, she gave them a general rundown: He usually left for Vegas on Tuesday or Wednesday and returned Thursday or Friday, almost always during daylight hours. He never filed a flight plan. He normally wore the blue robe he’d been wearing that night. He typically drank four to five beers around dinnertime and maybe some wine with dinner. (Curiously, the glass where he’d been sitting at the dining table contained hard liquor.) They rarely used the alarm system in the house, unless they were on vacation. When he was in Las Vegas, he didn’t gamble. And she didn’t know anyone else with whom he had regular contact there other than his Realtor, David Mitchell.

  She also said that a number of keys to the Balboa Coves house hadn’t been returned by workmen, such as window cleaners, gardeners, and painters, but she hadn’t copied any keys herself. Nor did she know where Bill would have had any made.

  “You can call me anytime,” Nanette said. “I want to help in any way that I can.”

  When her gunshot residue test came back, her hands were clean.

  CHAPTER 5

  That Saturday morning, December 17, the first news story hit the local paper, stripped across the front page. Few details were released and no suspects were cited in the Daily Pilot story, which said, Police were tight-lipped about William Francis McLaughlin’s death, citing a need to protect their investigation.

  The NBPD wouldn’t even acknowledge that the divers seen combing the waters behind the house were part of the homicide investigation. But, in fact, two sets of divers scoured the channel for a day and a half, looking for the murder weapon. One was a team of Newport Beach lifeguards and the other was a U.S. Navy dive team, stationed in San Diego, that used metal detectors to search through the thick marine grass covering the channel floor.

  In the article, Bill was described by neighbors as a physically fit man who would jog through the complex, and when a homeowners’ association fund fell short of the kitty needed to install the community security gate in 1990, McLaughlin was among the residents who made an additional donation.

  Although neighbors said Bill had been affectionate with Kevin at a homeowners’ association party, they also said they found Bill and his family to be “standoffish,” because they hadn’t socialized much with neighbors over the two decades they’d lived in Balboa Coves.

  The regional paper, the Orange County Register, also played the story on its front page, with the headline NEWPORT MILLIONAIRE SLAIN IN GATED HOME.

  “He was a really nice guy,” twenty-six-year-old Jenny McLaughlin told the reporter. “This has always been a really quiet neighborhood, but who knows.”

  Citing court records, the article characterized Bill and Sue’s divorce as “bitter,” noting that she’d gotten a restraining order to stop him from transferring any holdings and from calling her early in the morning to bully her into taking a payout of $1 million of his “hard-earned money.” If she didn’t, he’d threatened to take “unpleasant tactics.”

  He’s very controlling and domineering, Sue’s filings stated.

  In Bill’s filings from May 1990, he explained that Sue should not be given any direct control over any of the property. He needed full control over all of it, he said, as leverage for business purposes or his investments would fail. He offered to pay his wife $5,000 a month for living expenses.

  Bill also explained that the two 8:00 A.M. calls he’d made to her were never intended to harass her, only to save money on long-distance rates. He said he’d been threatened with legal action since 1989 by a former business partner, presumably Jacob Horowitz. Someone had been trying to serve him with papers, and he was simply trying to find out if it was Sue’s representative or someone else. He said he also wanted to question her about whether the $11,000 in charges on that month’s MasterCard bill were real or “unsubstantiated,” as they’d been the previous month, when he’d had to cancel the credit card.

  He said he’d started setting up a number of trusts to protect their assets from this litigation, including a Cook Islands Asset Protection Trust, as well as a living trust and an asset protection trust for his separate property after Sue had left the “family home.”

  Just as he later did with Nanette, it had been his practice with Sue to give her a certain amount to pay the household bills.

  Since I handled all the business of the community, all she would have to do was tell me how much she needed to run the household each month and I would give it to her, he stated in court papers. In this manner, I have provided substantial payments to my wife each month over the past several years. I never asked on what these moneys were spent even though I felt they were rather excessive.

  These filings indicate that Bill watched his money quite closely when Sue was managing the household. This begs the question whether Bill trusted Nanette so much that he blindly let her manage the bills and appointed her as a trustee to his estate, or whether he was still keeping an eye on things and could have figured out what she was doing just before he was killed, as his brother Patrick suggested.

  Although Nanette may have thought Bill had trusted her completely, it’s possible that she didn’t understand how these trusts and his estate worked as well as she’d thought. She also may not have known that Bill had designated a close friend to be the “protector” of his estate, which meant that the friend had the power to correct or change any of Nanette’s actions relating to the living trust.

  In his divorce declaration, Bill estimated the value of his estate at only $8.15 million, including $3.9 million cash in the bank. He listed $9.43 million in “liabilities,” including money that he figured he would have to pay Jacob Horowitz, who later cited these documents as proof that Bill knew he owed him money when the two were fighting in civil court.

  In the end, Sue got to keep the Hawaii home, valued at $2.5 million, as part of a $4.5 million package that included a 1986 Isuzu Trooper and annual payments of $300,000. Bill kept a twenty-one-acre avocado ranch in Fallbrook (valued in 1990 at $690,000) in neighboring San Diego County, the Balboa C
oves house (valued at $600,000), and his two homes in Las Vegas. He also kept his airplane, two boats, two Mercedes cars, and a 1986 Chevrolet station wagon. In addition, he held on to all future earnings and royalties from the Plasmacell-C device.

  Because Bill’s character flaws and his total worth were cited in public divorce papers, they ended up in the newspaper and being batted around by neighbors and former business associates, which further upset his children and close friends.

  Reporters were also using the divorce file to track down Sue and question her, so she had the records sealed. However, some of the documents still remain today in the archives of an Alameda County courthouse, where they were filed as part of Horowitz’s several lawsuits against Bill and Baxter Healthcare, which were still pending when he was murdered.

  Bill McLaughlin’s slaying rocked the tiny bedroom community of Balboa Coves, where residents were rattled that such an incident could happen within the perceived safety of the gates. This was the kind of place where the well-off moved to get away from the dangers of urban life and the riffraff that went with it.

  “People came there to avoid getting their front door kicked down and shot,” Dave Byington, the retired homicide sergeant, recalled recently.

  But this case also had an air of intrigue and mystery. The shots were fired at close range, and the shooter left behind the bullet casings, which the police saw as a clue because the killer must have known that he (or she) had left no fingerprints on the shells. Early on, however, the police kept these details secret, which left the neighbors frustrated by the lack of cold, hard facts.

  “No information is available, so everybody is guessing,” Stan Love, a leader of the homeowners’ association, told the Los Angeles Times. “It sounds like somebody was mad at [Bill].”

  The impact of the incident wasn’t contained by the chain-link fence surrounding Balboa Coves—the entire city of Newport Beach was buzzing about it.

  “It was big news in Newport,” Byington said. “He’s a millionaire. Initially they were truly shocked because this just doesn’t happen in Newport. . . . It was fodder for the local papers’ front page forever.”

  Bill’s neighbors were, in fact, living under a false sense of security. The police figured that the killer used the shiny pedestrian-access key to get in. Then, after dropping it, he must have escaped via the abutting Newport Channel, in a car driven by an accomplice, by jumping the fence and running away, or through the pedestrian gate, left purposely ajar. In those days, all you had to do to get through the main entrance gate was punch in a simple code and drive in.

  It didn’t take detectives long to determine this was no random killing. Because so few people had copies of the keys the killer had left behind, detectives were pretty confident within a day or so of the murder that this was an inside job. So they promptly started surveilling both of Bill McLaughlin’s homes in Newport Beach, where they watched Nanette come and go—and they kept an eye out for any suspicious characters to show up.

  CHAPTER 6

  Sandy Baumgardner met Kevin McLaughlin at a Memorial Day party in 1989. She met Nanette about five weeks after Kevin’s accident in 1991. And after Thanksgiving dinner with the McLaughlins in 1993, Sandy dropped a note to Kevin, saying, If you want to get fish tacos, let me know. They began dating on and off after that, and she’d since become very close with the family.

  Sandy recalled recently that Kevin was good-looking, with a cute personality, noting that his brain injury had affected his time perception and speech, but not his overall ability to think.

  By the Saturday night after the murder, the police had cleared the Balboa Coves house for the family to return, so the McLaughlin clan gathered in the den with Nanette and a couple of Bill’s best friends from college to process what had happened. Nanette sat at the bottom of the staircase. Sandy and Denis Townsend stood next to Nanette, while Don Kalal and Kevin sat on a couch.

  “We were so shocked,” Sandy said. “Our wheels were all turning.”

  Thinking Nanette needed consoling, the group tried to comfort her with small talk, but she didn’t seem to want or need it. Nanette said she was going to continue to sleep at the beach house.

  “She didn’t seem very emotional,” Sandy said, and “for whatever reason, she seemed to be clingy with me.” Sandy couldn’t put her finger on what Nanette was feeling that night, but she kept catching Nanette staring at her in “kind of a needy way. She always struck me as very insecure.... If I were to speculate, she was trying to lure in a supporter, someone on her side.”

  Sandy called her father back to give him an update. As she was describing Nanette’s odd behavior, he said, “Let me give you some sage advice. You stay away from that woman.”

  Her father’s comment put her off a bit, because now that she was approaching thirty, she didn’t feel she needed his advice, even though he was a former special agent criminal investigator in the U.S. Air Force. But Ken Baumgardner didn’t need to see Nanette’s odd demeanor for himself. He’d had suspicions about her already.

  “He’d always told me that she was a little too aloof,” Sandy said.

  Bill had apparently complained to Ken about Nanette’s lack of involvement in his kids’ lives and in McLaughlin family get-togethers that past year.

  “My dad’s impression of her from the get-go was that her background didn’t add up—the whole story about the basketball scholarship and [being a] child prodigy,” Sandy said. “His impression was that she was a gold digger with two little kids, trying to find a rich guy to latch onto.”

  Sandy’s father told her that he’d never discussed his impressions with Bill because he felt it wasn’t his place. Sandy hadn’t said anything to Bill about her perceptions either. However, she, Kim, and Jenny often joked among themselves about Nanette’s antics and malapropisms, mocking her boasts that she’d scored a very high score on the Law School Admission Test (LSAT), for which the best possible score was only a fraction of the number she cited.

  Nanette also told them she’d graduated early from high school in Phoenix after playing on the basketball team, then got a basketball scholarship to attend Arizona State University (ASU). There was some photo floating around of her playing basketball, Sandy said, but the girls didn’t believe much of that talk either.

  “The tongues would wag behind the scenes when Bill wasn’t in earshot,” she said. “Kim and Jenny just couldn’t stand sitting at the table with her. It was eye-rolling time, because Nanette would try to hijack the conversations and it was usually to talk about her kids or that she could bench-press four hundred pounds.” If everyone else started talking, “she would just sort of pout.”

  To Kim, Jenny, and Sandy, Nanette never seemed very cerebral, which was a marked and rather disturbing contrast to Bill.

  “Nanette didn’t have much intelligent to say at the dinner table or anything, and my dad was a real smart, bright man, and he would love to philosophize and pontificate,” Kim McLaughlin Bayless recalled recently. “People would come to our dinner table to discuss business with him because he was very well-respected in our community and with our friends, and he liked to take risks.... I thought it was odd that Nanette didn’t take part in many of those conversations. She didn’t really say much at all. Maybe she was intimated by us kids, I’m not sure.”

  Other than the obvious physical attraction, Bill’s adult children just didn’t get what he saw in Nanette. But he’d never said a harsh or critical word about her, and he spoke just as highly of her kids as he did of his own.

  Nanette wanted to go grocery shopping that Saturday evening to buy some food for the beach house, so Sandy went with her to Lucky’s, still trying to support the woman she assumed was grieving and eventually would need some comfort. She figured Nanette’s flat affect was just a mask to cover deeper emotions.

  The poor thing, she’s going to explode.

  Looking back later, Sandy said that Nanette seemed “kind of glazed over. It was almost an act.” But at the time, San
dy was simply puzzled by it.

  “At the very least I expected her to be, by that time, upset that her kids had been so close to that kind of danger.”

  Sandy just nodded as she listened to Nanette engage in what seemed like “pointless banter.” Nanette said nothing about Bill’s death, and made “robotic-like” conversation about her own situation as she threw a box of cereal into the shopping cart for the kids, who were still staying with her ex-husband.

  “What am I going to do?” Nanette asked rhetorically. “I just don’t know what to do next.”

  But there was no needy hug, and no emotional explosion.

  Well, that was a goddamn waste of time, Sandy thought as she left the store. There is something wrong with her.

  The next morning, Sue McLaughlin went to pick up her oldest daughter, Kim, from the airport. When Kim arrived at the house after her ridiculously long flight from Japan, she met Kevin halfway into the foyer, dropped her duffel bag, and embraced him. Then she grabbed him by the arms and looked him in the eye.

  “Oh, my God, Kevin, what happened?” she asked. “What do you know about these keys?”

  But Kevin just shook his head. He had no idea who had left them in the door and on the mat.

  CHAPTER 7

  As soon as they cleared the crime scene, Detectives Bill Hartford and David Szkaradek drove to Santa Barbara that Saturday to interview Jacob Horowitz.

  Horowitz gave them an alibi for the night of the murder, saying he’d gone to the barber, then to Vons, and returned home to spend the evening with his wife.

  The detectives explained that they’d found documentation of the complex legal battle between the two former partners, and they’d traveled up the coast to question him. The litigation, they said, seemed like a pretty good motive to kill Bill.

  Asked if Bill had ever threatened him, Horowitz said, “Way back in ’82, he said, ‘If you don’t do this . . . I’ll sue you,’ which he did.”