by Steven Gore
Gage gazed out of the window while doing his own calculation. “If Braunegg’s firm got thirty to forty percent, that would be fifteen or twenty million. Even if they had a few million in expenses, they made out like bandits in slam-dunk cases.”
“Slam-dunk? I thought these cases are more complicated than that.”
Gage looked back at Alex Z. “If Peterson can prove a criminal case to a jury beyond a reasonable doubt, then even a second-or third-rate attorney can reach a preponderance of the evidence in a civil trial. It’s not that hard to tip the scales, especially when the defendants all have fraud convictions.”
Alex Z’s eyes widened. “You mean a guy driving on a suspended license facing a four-hundred-dollar fine can’t be convicted unless the jury finds him one hundred percent guilty beyond a reasonable doubt, but Mr. Burch could be wiped out based on fifty-one percent to forty-nine percent?”
“Pretty close.”
Alex Z threw up his hands. “That’s absurd.” He looked down, shaking his head, then up at Gage. “I see what Braunegg gets out of it, but what about Peterson?”
“Peterson can use Braunegg to take advantage of civil discovery rules that force defendants into depositions. The smart thing is for Jack to take the Fifth. He could do it secretly in front of the grand jury. But he knows if he did it in a deposition, Braunegg would leak it to the media.”
Gage cringed as he imagined the press stationed on the sidewalk in front of Burch’s house, and the humiliation inflicted by cameras riveted on his car window as he drove from his underground garage.
But there was something worse: “In a criminal case, a jury can’t hold it against you if you take the take the Fifth; in a civil trial they can. Braunegg would crush Jack with it.”
“But I thought they delayed—”
Gage shook his head. “There’s no way a judge would delay the civil case until the criminal trial is over. A lot of the shareholders are elderly. The court will want them to get their money back, not die waiting.”
“Well, then Mr. Burch should just let himself be deposed. Maybe once everyone hears the truth that will be the end of it.”
“It’ll only make things worse. Not only will Peterson assume Jack is lying, but it’ll give Matson a chance to adapt his story to Jack’s defense. In fact…” Gage imagined Braunegg and Peterson forehanding Burch back and forth like a tennis ball on an imaginary red clay court at a very real old boys’ club. “Braunegg can tailor his questions to what Peterson is forcing out of witnesses at the grand jury.”
Alex Z drew back. “That’s not right. Grand juries are supposed to be secret.”
“Only in theory.”
“But I thought Peterson was a straight shooter. NFL and all that.”
“Sports build muscles, not character. How many times do you think Peterson held a blocker, tripped a half-back, forearmed a quarterback, took a penalty rather than let the other side score? You think any coach ever complained? The only thing a coach ever said to him was, ‘Don’t get caught next time.’”
“And Braunegg?”
“A calculating little scavenger.”
CHAPTER 44
Franklin Braunegg was just biting into a BLT when Gage pulled up a third chair to his table for two at the Hidden Valley Country Club. Over the years, Gage had watched Braunegg try to transform himself from a personal injury street fighter into a white-collar sophisticate, but he only ended up looking slick. Eyes too predatory. Hair dyed too dark. Too many rings on his clawlike hands.
“Where’s your pal, Peterson?” Gage asked, glancing at the half-eaten Cobb salad across the table from Braunegg.
Gage knew the answer. He’d spotted an FBI agent driving Peterson away a few minutes earlier.
“Hadda go inta the offish,” Braunegg said, trying to chew and answer at the same time. Braunegg swallowed hard, then took a sip of ice tea. “How ya doing, Graham?”
“I’m a little concerned about a friend of mine.”
“So I heard.”
Gage tilted his head toward the parking lot. “From Peterson?”
“A little bird.”
“I think Peterson would find that description insulting.”
Braunegg laughed, spitting out a piece of bacon that landed in Peterson’s abandoned salad.
“So what do you want?” Braunegg asked.
“I want you to lay off Burch. Withdraw your subpoena and don’t name him as a defendant for a few months.”
“Not possible.” Braunegg sucked on his teeth. “I’ve got a thousand plaintiffs who want his head. And, of course, his money, which he has a lot of. I need to keep the clients happy. Happy clients are grateful clients. Grateful clients refer friends and family.”
“But that’s not how you got SatTek.”
Braunegg shrugged. “I don’t know how we got it. The case just came in. Maybe the shareholders saw me on FOX News and liked my spiel.”
“I don’t think so,” Gage said, finally repaying the wink.
“What are you suggesting?” Braunegg’s face flared. “I don’t need to sit here—”
“Then get up.”
Braunegg threw his napkin onto his plate, but didn’t rise.
“Peterson fed you SatTek just like he fed you your last three securities fraud cases.”
“I’d like to see you prove it.”
“No you wouldn’t. That’s the last thing you want me to do.”
Braunegg glanced around the restaurant. Gage imagined that he was worried that members seated near them had noticed his loss of control in throwing down his napkin.
“You want to take a little walk?” Gage asked.
Braunegg signaled a waiter and signed his tab, then Gage led him out to the parking lot.
“So what if Peterson sent over the plaintiffs,” Braunegg said, as they stood next to Gage’s car. “It’s not a crime.”
“That depends.”
“Depends on what?”
“What else got put on your tab besides an overpriced salad and whether he also sent over grand jury material.”
“You’d have a hard time proving either one.”
“Not so hard.” Gage leaned in close, pointing at Braunegg’s chest. “You’re too flashy. It’s the reason why you never did well in trial. You show your hand too soon, no self-control.”
Braunegg drew back. “Look, Gage, I don’t have to stand here and take this shit from you.”
“First you don’t want to sit, now you don’t want to stand. Which is it?”
“How about just show me your cards and let’s get this over with?”
“I talked to Hackett. Matson isn’t cooperating with you. I talked to Granger’s lawyer and Granger wasn’t cooperating with you, either.”
Braunegg remained silent. His face set. Not sure where Gage was headed.
“Read over your complaint. You have allegations in there that could’ve only come from Matson and Granger. And only Matson was talking—and not to you.”
“Like what?”
“The alleged connection between Burch and Fitzhugh. That went from Matson to Peterson to you.”
Braunegg blanched like he just got caught stuffing jumbo shrimp into his wife’s purse at a cocktail party.
“And that’s all you want? We hold off of Burch? Why not just go to the press? Take a shot at making us pull out of the case? You might even get Peterson fired.”
“Because somebody else would take it over and I’d just have to come up with a way to lean on them—and I don’t have time. And it doesn’t help me to end Peterson’s career. Another U.S. Attorney would just come into the case and we’re back where we started.”
Braunegg looked toward the parking lot exit, as if there was a street sign in the distance to tell him which way to turn, then decided to call for help. “I’ll talk to my partner.”
Gage pulled out his business card, wrote a telephone number on the back, then handed it to Braunegg. “This is the telephone number of Kenny Leals at the New York Times. You can
either call me in one hour agreeing or call him in two hours explaining. Do yourself and Peterson a favor. Call me in one.”
Gage had driven less than a mile away from the Hidden Valley Country Club when his cell phone rang.
“You’ve got a deal. Two months. But someday the shoe’s going to be on the other foot,” Braunegg said. “What goes around comes around.”
There was only one type of person Gage hated more than liars: people who thought in clichés. They couldn’t help but lie to themselves.
“No it won’t and no it doesn’t.”
“You better watch your back.”
Not another one. Better answer in a way he understands.
“You couldn’t sneak up on the dead.”
CHAPTER 45
I think we’ve got a leak from the grand jury in the SatTek case,” Peterson told United States Attorney Willie Rose at the weekly meeting of the senior staff in the windowless conference room on the eleventh floor of the Federal Building.
Spread around the table along with Peterson, as head of Securities Fraud, were the chiefs of Major Crimes, White Collar, Organized Crime, Anti-Terrorism, and the Drug Enforcement Task Force. All of them looked at Rose with uncertainty. The first black federal district judge in the Eastern District of California, Rose had resigned a year earlier to assume leadership of what the press called the “troubled” U.S. Attorney’s Office for the Northern District of California. And while each knew they had been promoted as part of Rose’s solution to the troubles, they all feared becoming vehicles for his political ambition.
“If we had somebody in Congress with balls enough to sponsor a constitutional amendment,” Rose said, “we’d get rid of the stupid thing. We don’t need a damn grand jury to tell us we have a case. We tell them. It’s a waste of our time and taxpayers’ money.” Rose tossed his pen onto his yellow legal pad, then looked over at Peterson. “Why do you think you’ve got a leak?”
Everyone at the table, and their assistants sitting behind them, alerted like golden retrievers. Peterson wasn’t a guy who said whatever happened to flit through his mind. If he raised an issue, he’d thought about it.
“We’ve had two grand jury targets murdered and one who barely survived.” Peterson glanced around at the others. “Some of you know him, Jack Burch. The dead ones are a chartered accountant in London named Fitzhugh, and Edward Granger, a venture capital guy who we had just told the grand jury would be coming in to testify as a cooperating defendant.”
“I thought Burch was road rage,” Rose said.
“That’s the party line, but I’m not sure. The later shooting that I thought was road rage wasn’t. It was domestic. The wife thought hubby was having an affair with a woman he jogged with in the mornings. But even if we set that aside, we have Fitzhugh and Granger. It’s like somebody is trying to contain the case and somebody in the grand jury is tipping them off.”
The tension in the room ratcheted up.
Rose shifted into cross-examination mode. “What’s your evidence?”
“It’s less evidence than a pattern. Shortly after I introduce the case to the grand jury, Burch and Fitzhugh get hit. Then we tell them that Granger is about to cooperate and he gets taken out.”
“What about Matson?”
“Nobody’s bothered him and he says he’s not afraid.”
Rose peered over at Peterson as if the solution was obvious. “Doesn’t that tell you that he’s somehow in on it?”
Peterson shook his head. “I’ve spent a lot of time with him. He doesn’t have the balls.”
“Then what?”
“My guess is that there’s something we don’t know that connects Burch, Fitzhugh, and Granger that’s separate from Matson, and somebody doesn’t want it to come out.”
“Who were the stockbrokers?” asked Lily Willison, the leader of the Organized Crime Division, known as Mainframe because of her computerlike memory.
“Northstead Securities in San Diego. Kovalenko. Yuri.”
Willison looked toward the ceiling, searching her mental database, then back at Peterson. “He’s as gangedup as they come. Just like his dead brother. Maybe he’s the one trying to contain this thing.”
“I considered that,” Peterson said. “But as far as we can tell, Kovalenko’s only connection to SatTek was pump and dump. And he isn’t afraid of doing a couple of years. He won’t get involved in murder just to save himself a short vacation in minimum security. And even if it is him, the information about who to target had to come from somewhere.”
“Why not just ask the court to impanel another grand jury…” Willison hesitated, her face flushing. She swallowed, then finished the question, voice rising to a squeak. “And start over?”
The question hung in the air like a raised sledgehammer. Everyone knew, Willison most of all, that she was about to get thumped.
“Let’s back up,” Rose said, setting up the blow. “How many indictments has that grand jury issued?”
“Fifty, sixty, something like that,” Peterson said.
Willison’s interlaced fingers began to dig into the backs of her hands.
“How many defendants altogether?”
“Two hundred or so. Maybe more. They did two racketeering indictments with about thirty defendants each.”
Rose looked at Willison, then swung down. “Are you ready to disclose grand jury misconduct to two hundred defense lawyers? Ready to answer two hundred motions to dismiss? Maybe a hundred speedy trial motions? Maybe even a bunch of grand jury abuse motions? When we don’t even know for sure what happened?”
Willison shook her head, but held his gaze.
Rose reached for his pen, then began drumming it on the conference table, looking from face to face, lowered eyes ducking guilt by association.
“I see there aren’t any volunteers for a little motion exercise.”
Rose exhaled. It was moments like these that reminded him how much easier life was on the bench. He took the U.S. Attorney appointment only to get his name in the media to set up a run for governor, and planned to kick it off with Burch’s indictment and a no-one-is-above-the-law-time-to-get-the-big-time-lawyers press conference. But grand jury problems were messy. The public wouldn’t understand and the mess would slop back onto him.
Rose glanced at Peterson. “You and I need to visit the chief judge. Anybody have anything else?” Rose paused, then looked around the table. “No? Then we’re done.”
The chief judge cleared his calendar for the meeting, and later that day Peterson called Zink into his office.
“The chief judge authorized an investigation. I told Rose you’ve done great work on the case and you’re in the best position to connect the dots. He agrees.”
Zink settled into a chair across from Peterson. “Thanks for the vote of confidence, but this could spin out of control. You think any of the grand jurors will go to the press if they get wind of what we’re doing?”
“Only one I can think of.”
“Number Six?”
“Yeah, Number Six,” Peterson said. “And just wait until we have one grand jury investigating another. They’ll be giving me funny looks, wondering if we’re going after them, too.”
“Where do you want to start?”
“The attendance records and notebooks. They’re required to store their notes at the clerk’s office when they’re not in session. Let’s see who was present at each hearing and what they wrote. But let’s be careful we don’t focus too much on Number Six. Being a runaway doesn’t mean he’s the one. It’s a huge jump from being a little hyperactive to fingering people for hits.”
Zink glanced up in the direction of the grand jury room. “How will I get the notebooks?”
“The chief judge is sending an order to the clerk. He authorized you to make copies each evening after they’ve been collected. But you have to give the copies back to the clerk when your investigation is done. Same with the attendance records.”
Peterson paused, leaned back, and looke
d up toward the ceiling.
“I wonder if it’s just SatTek or if this guy, if it is a guy, is also doing this in other cases.” He glanced at Zink. “How about you get me the other indictments? I’ll find out if anything hinky happened in those cases. Maybe not murders, but witnesses knowing they’re about to be subpoenaed or targets getting advance warning of their indictments and making a last-second run. Maybe this guy shops his wares around to everybody.”
“Will Rose back you if this blows up?”
“Not if he wants to get elected governor. He’d never get past the primary.”
By the time Peterson arrived at Zink’s office the following morning, Zink had profiled each of the twenty-three grand jurors and posted leads from the jurors’ notebooks on a cork board tacked to the wall.
“I’ve got it reduced down to the three most likely,” Zink began after Peterson sat down next to his desk. “Number Six, Number Thirteen, and Number Twenty-two.”
Zink stepped to his chart, using a Bic pen as a pointer. “Number Six. Not only does he summarize everything, but he makes margin notes of his opinions. His favorite word is ‘asshole’…” Zink paused for a moment. “And he most often applies it to you.”
Peterson shrugged.
“He never liked you as a football player and is thrilled you never made it into the hall of fame. And he doesn’t like Matson, thinks he’s a scumbag. He wrote that he wishes this was a capital case and that he’d like to blow the brains out of anybody who was part of the scheme.”
“So he’s in the postal worker category.”
“Exactly. Number Thirteen maybe is just unlucky. He got caught talking about a case in the hallway. They all do it one time or another. The grand jury clerk told me she overheard the chief judge reading him the riot act. The guy was real upset. He begged to stay on. Maybe he became resentful enough to want to sabotage the whole thing.”
Peterson shook his head as if to say that this investigation would be going nowhere. “Another weak candidate.”
Zink nodded, then tapped Number Twenty-two. “But here’s a contender. What got my attention is that he wrote down Kovalenko’s patronymic not as ‘B-o-r-i-s-o-v-i-c-h,’ but as ‘B-o-r-y-s-o-v-i-c-h,’ old style. I figured he’s got a Russian background. And bingo. His family name was Toshenko. When his grandparents got to Ellis Island in the early 1920s, the immigration people anglicized it to Thomas.”
