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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Criminal Action No. 04-cr-103-REB UNITED STATES OF AMERICA, Plaintiff,

NORMAN SCHMIDT, GEORGE ALAN WEED, CHARLES LEWIS, MICHAEL D. SMITH, Defendants. _______________________________________________________________ REPORTER'S TRANSCRIPT TRIAL TO JURY - VOLUME XV _______________________________________________________________ Proceedings before the HONORABLE ROBERT E. BLACKBURN, Judge, United States District Court for the District of Colorado, commencing at 8:55 a.m., on the 24th day of April, 2007, in Courtroom A701, Alfred A. Arraj United States Courthouse, 901 19th Street, Denver, Colorado. APPEARANCES WYATT B. ANGELO, MATTHEW KIRSCH, Assistant United States Attorneys, 1225 Seventeenth Street, #700, Denver, Colorado, appearing for the Government. Suzanne M. Claar, Official Reporter 901 19th St. Denver, Colorado, 80294-3589 (303)825-8874 PROCEEDINGS REPORTED BY MECHANICAL STENOGRAPHY TRANSCRIPTION PRODUCED BY COMPUTER

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APPEARANCES (Continued) PETER R. BORNSTEIN, 1600 Broadway, #2350, Denver, Colorado, THOMAS J. HAMMOND, 1544 Race Street, Denver, Colorado, appearing with Defendant Schmidt. THOMAS E. GOODREID, 1801 Broadway, #1100, Denver, Colorado, appearing with Defendant Weed. RONALD GAINOR, 6414 Fairways Drive, Longmont, Colorado, appearing with Defendant Lewis. DECLAN J. O'DONNELL, 777 Fifth Street, Castle Rock, Colorado, RICHARD N. STUCKEY, 2150 West 29th Avenue, #500, Denver, Colorado, appearing with Defendant Smith.

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P R O C E E D I N G S (Proceedings resumed at 8:55 a.m.) THE COURT: Very well. Thank you, and please be seated. Mr. Schmidt, good morning. Good morning.

MR. SCHMIDT: THE COURT: MR. WEED: THE COURT: MR. LEWIS: THE COURT: MR. SMITH: THE COURT: MR. ANGELO:

Mr. Weed, good morning. Good morning, your Honor. Mr. Lewis, good morning. Good morning, your Honor. And Mr. Smith, good morning. Good morning. Counsel, good morning. Good morning, your Honor. Good morning, your Honor.

MR. BORNSTEIN: THE COURT:

And ladies and gentlemen generally, good Is his present

I note that we are shy Mr. O'Donnell.

circumstances or whereabouts known, Mr. Stuckey? MR. STUCKEY: No, your Honor. I suspect it's an I-25

I checked my office.

They didn't have a call from

I thought perhaps he had called in to your chambers but he So he might be on I-25

sometimes doesn't carry his cell phone. without the cell phone.

Mr. Kirsch asked me whether his presence would be required for the, I guess, next step he would like to take which is presentation of the death certificate regarding the deponent,

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Mr. Herbert.

I said no, we wouldn't need him for that. Very well. Thank you for your report. The

THE COURT:

I-25 illness apparently has reached epidemic proportions.

It

has infected my usual courtroom deputy clerk, Mrs. Ginny Kramer, and one of our jurors, Mrs. Antrillo, who, because of her ankle and foot, is being transported on a daily basis by a taxi courtesy of the court and she has not yet arrived either. Very well. We convene and proceed deliberately outside

the presence and hearing of the jury to consider business requested by counsel. Mr. Kirsch. MR. KIRSCH: THE COURT: MR. KIRSCH: Good morning, your Honor. Good morning. Your Honor, we simply wanted to ask the Thank you.

court to make a finding, for the purposes of the record, that Mr. Herbert was in fact -- is now dead at the time of the trial, and that therefore it is proper for us to continue to proceed by way of videotape deposition. My understanding is that each of the defendants in this case is willing to stipulate to that fact. And assuming that

they confirm that, we would simply ask the court to make that finding for the purposes of the record. I also wanted to just inform the court about how we intended to proceed through the rest of the deposition. to play it mostly straight through. That is

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In advance of beginning the publication, we distributed a proposal to the defense attorneys that omitted a few sections that were essentially housekeeping matters during the deposition, tape changing, and that sort of thing. Again, it's my understanding that the defense -- the defendants are all agreeable with the proposals that we have made in that respect. And therefore we have instructed the

technician to at the appropriate points upon which the parties have agreed pause the deposition or pause the DVD, advance it to the next section, and then begin playing it again. Finally, with respect to any exhibits that are discussed during the deposition, it's our proposal that any party who wants to offer exhibits at trial do so at the conclusion of the deposition and allow the court then to rule on them. I can further inform the court that the government does not expect to need to offer any exhibits at the conclusion of the deposition. Any exhibits that are discussed during the

deposition we intend to offer through later witnesses, if they have not already been admitted. THE COURT: Thank you. The government has articulated

for the court and the defendants essentially two principal stipulations, the second of which has two subparts. The first proposed stipulation, as I understand it, would permit the court to find and conclude that the video

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deponent, Gary Herbert, Esquire, is in fact deceased, and was deceased before the commencement of this trial, making him unavailable within the meaning of the Rules of Criminal Procedure, and thus validating the propriety of the broadcast of this preservation video deposition. The second stipulation with two subparts, as I understand it, focuses on the videotaped deposition and aspects of it. The first subpart, as I understand it, involves the stipulation approving the redaction to the broadcast of the videotaped deposition to eliminate irrelevant and superfluous excerpts. And allowing the government's technician to control

and conduct the broadcast accordingly. The second part of that second proposed stipulation would permit counsel for the defendants at the conclusion of the broadcast of the video deposition to offer in evidence those exhibits which were discussed or offered during the video deposition itself. That is my understanding of the government's proposed stipulations. Is my understanding correct from the perspective

of the government? MR. KIRSCH: THE COURT: sequentially. It is, your Honor. Thank you.

Then let's query the defendants

On behalf of Mr. Schmidt, do you understand the

stipulations and are they acceptable to you?

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MR. HAMMOND: THE COURT:

Yes to both, your Honor. Same questions on behalf of Do you understand these

Thank you.

Mr. Lewis -- strike that.

Mr. Weed.

stipulations and are they acceptable to you? MR. GOODREID: THE COURT: I do, and they are, your Honor. To Mr. Lewis, do you understand

Thank you.

these stipulations and are they acceptable to you? MR. GAINOR: THE COURT: We do, your Honor, and we accept them. And lastly but -- on behalf of Mr. Smith,

do you understand these stipulations and do you accept them? MR. STUCKEY: Yes, your Honor. With one addition, if I

might bring this up to the court.

I would request that --

first, regarding Mr. Herbert being deceased, we told the jury or read to the jury, just as your Honor stated. I am fearful the

jurors will have question if we discuss the Herbert letters and Herbert this and Herbert representation and whatnot as to why somebody primarily maybe Mr. Smith, or any of the defendants, didn't call Mr. Herbert to ask further questions that might have been asked or omitted in this deposition. THE COURT: Thank you. I will treat that as a third

stipulation to be reviewed and discussed momentarily. As to the two stipulations proposed by the government, now accepted and approved by the defendants, the court receives, accepts, approves, and orders implemented effective forthwith the terms and provisions of those two stipulations. And all

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parties shall proceed accordingly. Now, with respect to the third stipulation proposed by Mr. Stuckey on behalf of Mr. Smith, which is that the court inform and instruct the jury of the fact of the death of Mr. Herbert. Is that understood and accepted by the government? It is, your Honor. By Mr. Schmidt? Yes, your Honor.

MR. KIRSCH: THE COURT:

MR. HAMMOND: THE COURT:

By Mr. Weed? It is understood, your Honor, but it's That is that there is some

MR. GOODREID:

objected to on this basis.

suggestion, I think it comes up in the deposition, I don't recall it specifically, but there is an implication that a person is dying is more likely to tell the truth than not. So I

object on the basis that's bolstering testimony of the deponent. THE COURT: Is the stipulation, the third stipulation

proposed by Mr. Stuckey now under consideration understood by and acceptable to Mr. Lewis? MR. GAINOR: We understand it, your Honor, but after

listening to Mr. Goodreid's position, I would join it on his objection. THE COURT: And I know your position, Mr. Stuckey.

Counsel, can we stipulate as to the date of Mr. Herbert's death, and if so, what is it, please? MR. KIRSCH: I will get that in one moment, your Honor.

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Your Honor, according to the death certificate, the date of death is May 12th, 2006. THE COURT: Is that proposed fact and date of death Mr. Hammond.

opposed by any one or more of the defendants? MR. HAMMOND:

Your Honor, I don't have any particular

problem with establishing the fact that Mr. Herbert has died. THE COURT: My question is very narrow. I understand that, and that's why I am --

MR. HAMMOND: THE COURT:

Is that in fact the date of the deponent's

MR. HAMMOND:

I believe that is his death.

What I

don't see is what the particular relevance is of the date of his death. He was obviously alive when they took the deposition. I don't know why we have to go belabor it

Subsequently he died. further. THE COURT:

Now, Mr. Goodreid, back to your objection.

Is it your representation to the court that the fact that Mr. Herbert is moribund is discussed during the deposition, during his testimony? MR. GOODREID: with the court. Well, your Honor, I have to be honest I

I don't recall that specifically came up.

remember it was in the air.

I don't know if we talked about it

beforehand in the deposition. When the court would hear me on it, I have an alternative suggestion.

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THE COURT:

And I will. Mr. Weed would have no objection to

MR. GOODREID:

simply stating to the jury that Mr. Herbert is giving his deposition because he is presently unavailable. takes -- that would take away my objection. THE COURT: Well, transforming this from a Federal I think that

Court to the United Nations, I am tempted to appoint an ad hoc committee. No, I am not.

There is a Motion to Amend Mr. Stuckey's stipulation rather than advising the jury that Mr. Herbert is in fact deceased and providing them with the unopposed date of his death, to simply instructing the jury that Mr. Herbert is unavailable for purposes of this trial. Any objection to that proposed amendment. author of the initial stipulation, Mr. Stuckey? MR. STUCKEY: None, your Honor. We are with the United First by the

We agree with it. THE COURT: Any objection on behalf of Mr. Schmidt? No objection, your Honor.

MR. HAMMOND: THE COURT: MR. GAINOR: THE COURT: MR. KIRSCH:

Or on behalf of Mr. Lewis? No objection, your Honor. Any objection by the government? No, your Honor. We believe that would be

THE COURT:

Then the Goodreid amendment is approved,

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and at the propitious time, perhaps immediately subsequent to the broadcast of the video deposition, the court will inform and instruct the jury that the videotaped -- the broadcast of the videotaped deposition was necessary due to the unavailability of Mr. Herbert at trial. Mr. Hammond. MR. HAMMOND: Your Honor, I brought this up a few days And we shall proceed on that basis.

ago with your clerk, and it's just a housekeeping matter, and that is tomorrow I am set for sentencing before Judge Krieger at eight o'clock. Given what happened yesterday, I am not sure I am hoping to

that I will say I can be done in half an hour. be done within an hour.

I am asking the court's indulgence to

perhaps start at nine o'clock. THE COURT: May we proceed with Mr. Bornstein at the

helm for that anticipated one-half hour? MR. HAMMOND: your Honor. We might very well be able to do that, I don't know who is

We had divided witnesses.

going to be first up in the morning. THE COURT: Let's do this.

That was my concern. I am going to defer further

consideration of this request until this evening when we will know much better where we are. MR. HAMMOND: I just wanted to bring it up for the

court's attention so you know where I am at. THE COURT: And I appreciate the FYI once again. Thank you.

MR. HAMMOND:

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THE COURT: prepared to proceed.

Now, I don't know whether the jurors are Let us recess to determine that. Please

don't wander far from the courtroom.

And perhaps, Mr. Stuckey,

you could investigate the whereabouts and circumstances of Mr. O'Donnell. MR. STUCKEY: I will inform Mr. O'Donnell of the

amended stipulation we have here unless he makes some reference to Mr. Herbert's death at some point. THE COURT: And assuming arguendo that Mr. O'Donnell is

not present and prepared to proceed momentarily, may we continue to proceed in his absence? MR. STUCKEY: I was not in the case during the He was. However, it's just a movie.

deposition, your Honor. So I guess I have no -THE COURT:

For a minute I thought it was Santa Claus.

That's due to ocular degeneration attendant to insenescence. We are in recess. Thank you.

(Recess at 9:10 a.m., until 9:15 a.m.) THE COURT: Thank you, and please be seated.

Madam clerk, I am advised that the jurors are present and prepared to proceed. Would you please escort and show them

into the courtroom and jury box, and thank you. And Mr. O'Donnell, good morning. MR. O'DONNELL: Yes. I apologize. The highway was

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THE COURT:

We had a number of people suffering from

the freeway disease this morning. (Jury in at 9:15 a.m.) THE COURT: Thank you, and please be seated. Very

I have already bid everyone else in the courtroom a good Ladies and gentlemen of the jury, good morning. THE JURY: THE COURT: Good morning. While you have been waiting, we have been

morning.

We are now intact, present, and presumably prepared to

proceed, and if so, the government may resume its broadcast of the Gary Herbert video deposition. MR. KIRSCH: THE COURT: Thank you, your Honor. You are welcome.

(The videotape deposition of Gary Herbert was played). THE COURT: Excuse me. Could you stop the broadcast,

THE JURY: THE COURT:

We don't have it. Madam clerk, if you will display it to the

MR. GAINOR: THE COURT:

And it's not on this screen as well. Other than that, Mrs. Lincoln, how was the

Very well.

The government may resume the broadcast of

the video deposition. (The videotape deposition of Gary Herbert was played.)

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THE COURT:

Thank you, ladies and gentlemen.

A

propitious time for us to take our midmorning recess, preparatory to which please store your note-taking materials for now across the hall, and be, of course, ever mindful of the important rules that govern your conduct as jurors in this trial. We will be in recess for fifteen minutes. (Recess at 10:30 a.m., until 10:50 a.m.) THE COURT: Thank you, and again please be seated,

ladies and gentlemen. Very well. The government may resume the broadcast of

this video deposition. (The videotape deposition of Gary Herbert was played.) MR. KIRSCH: We have about two minutes left on this

I know the technician is trying to start it for the last I am not sure what the issue is, but we will

two minutes.

attempt to address it as soon as possible. THE COURT: Thank you.

During this hiatus, ladies and gentlemen, I would instruct and inform you that periodically there have been lapses or hiatuses in the broadcast. Those are not due to technical

difficulties but due instead to the stipulation of the parties approved by the court to spare you of having to watch what in essence is unnecessary, irrelevant, and superfluous information. Please be advised.

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MR. KIRSCH:

Your Honor, can I have just a moment to

THE COURT: MR. KIRSCH:

Thank you.

You may.

Your Honor, the problem appears to be with I apologize for the delay.

the computer that we are using. Excuse me.

As I bean my co-counsel.

We do have another laptop that ought to be able to play the video as well. If I could have a minute or two to swap And if that fails, we would propose

those out, I would do that.

simply offering a reader for the last two minutes of this disk in the hopes that then the next disk would then again work. THE COURT: Very well. Leave is granted as requested.

Frankly, I am relieved that I am not being beaned. Ladies and gentlemen, during this time, this hiatus, you of course may stand and stretch within reason. MR. KIRSCH: THE COURT: THE JUROR: MR. KIRSCH: Thank you, your Honor. Ms. Antrillo, please be especially careful. Yes, sir. Your Honor, I believe we are ready.

Apparently the decrepit government computer gets hot enough that it was beginning to warp the DVD. So we substituted a different

copy of the DVD, and hopefully no permanent damage to the first copy. THE COURT: Very well. Perhaps under the heading of

too much information, the government may now resume the

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broadcast of this video deposition. (The videotape deposition of Gary Herbert was played.) THE COURT: Very well. Would you interrupt the broadcast, please. We have arrived at our noon recess, and I

smell pizza, for whatever that is worth. We shall be in recess as concerns this trial until this afternoon at 1:15 p.m., to facilitate lunch in inclement weather. During this extended noon recess, please store and leave behind your note-taking materials in your suite, ladies and gentlemen, and of course, be ever mindful of the rules that govern your conduct as jurors in this trial. We are in recess until 1:15 p.m. (Lunch recess at 12:00 p.m., until 1:20 p.m.) THE COURT: Good afternoon. And thank you. Please be

seated, ladies and gentlemen. And very well, when prepared, the government may resume broadcast of this video deposition. MR. KIRSCH: THE COURT: Thank you, your Honor. You are welcome.

(The videotape deposition of Gary Herbert was played.) THE COURT: something similar. MR. KIRSCH: THE COURT: That is correct, your Honor. If you are quick and careful, you can stand I presume we are changing disks or

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and stretch, ladies and gentlemen. (The videotape deposition of Gary Herbert was played.) THE COURT: and stretch. MR. BORNSTEIN: MR. KIRSCH: May counsel do it too? Ladies and gentlemen, if you want to stand

Your Honor, I think this one may actually

be the court's system. THE COURT: Here, we go, blame the judge again. Again,

Madam clerk, your technical assistance, please. if you would please be seated. And we may now resume the Thank you.

broadcast of this video deposition.

(The videotape deposition of Gary Herbert was played.) THE COURT: Ladies and gentlemen, time for our

midafternoon recess of fifteen minutes, during which please store your note-taking materials, as you have been otherwise required periodically by the court, and of course, be sensitive to the important rules that govern you as jurors in this trial. We are in recess for fifteen minutes. (Recess at 3:00 p.m., until 3:20 p.m.) THE COURT: Thank you, and again please be seated,

ladies and gentlemen. And if prepared, the government may resume broadcast of the Herbert video deposition. (The videotape deposition of Gary Herbert was played.) THE COURT: It appears that the broadcast of the

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Herbert video deposition is now complete. MR. KIRSCH: THE COURT: Yes, your Honor.

Is that correct?

Thank you.

Ladies and gentlemen, please be further

advised and instructed, that the broadcast of this video deposition is necessary because Gary Herbert, the deponent, is unavailable to testify during this trial. Thank you.

Now, counsel, pursuant to the parties' stipulation which has been approved by the court, does any party now seek to offer in evidence any exhibit that may have been identified, offered, or discussed during the Herbert video deposition? government? MR. ANGELO: THE COURT: The government does not, your Honor. Mr. Schmidt? No, your Honor. Thank you. The

MR. HAMMOND: THE COURT:

Mr. Weed? No, your Honor. Thank you.

MR. GOODREID: THE COURT: MR. GAINOR: THE COURT: MR. GAINOR: THE COURT:

Mr. Lewis? If I may have a moment, your Honor. Counsel, you may. No, your Honor. And Mr. Smith? Yes, your Honor. Thank you. Thank you.

MR. O'DONNELL: May I? THE COURT:

I am waiting.

We are waiting.

I will

conjugate no further.

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MR. O'DONNELL:

We move to the admission of And those are the same as

Government's Exhibit No. 901 and 902.

the Smith exhibits -- as the attorney letter and the -- the two attorney letters, I believe 901 and 902, which would be -- start with this one -- the Herbert deposition page 164, offered by myself and chimed in by the prosecutors at pages 202 and 203 of the exhibit -- or of the deposition, and that's the June 21st, 2002, letter by Gary N. Herbert, attorney at law, addressed to Michael D. Smith, and it was thoroughly discussed during the deposition. THE COURT: Mr. O'Donnell, you said or implied that

Herbert government deposition Exhibits 901 and 902 had been marked as Smith exhibits. MR. O'DONNELL: actually. This one. This one involves an indefinite pronoun for Is that correct?

It's actually -- this one is 902,

THE COURT:

which I can't conveniently or quickly tether a noun. MR. O'DONNELL: THE COURT: exhibits? Okay.

My question is, are they marked as Smith's

Either one or both of them? Yes.

MR. O'DONNELL: THE COURT: exhibits? MR. O'DONNELL:

And how are they marked as Smith's

C.

Exhibit 902 is the same as Smith

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THE COURT:

I am talking about trial exhibits.

You are

talking about Smith deposition exhibits corresponding with government's deposition exhibits; is that correct? MR. O'DONNELL: THE COURT: notebook? MR. O'DONNELL: THE COURT: Yes. Are they? May I consult with -Yes. Yes, I am, Judge.

Are they marked in your trial evidence

Not only may you, I insist. The particular one is No. -- trial

MR. O'DONNELL: Exhibit No. 3, Smith. THE COURT: Smith Exhibit 3.

Defendant Smith has offered in evidence

Any objection by the government? No, your Honor. Any objection on behalf of Mr. Schmidt? No, your Honor.

MR. ANGELO: THE COURT:

MR. HAMMOND: THE COURT:

On behalf of Mr. Weed? Your Honor, may I have a moment? I just

MR. GOODREID:

want to be clear that we are talking about Smith 3 and not Government 901 and 902; is that correct? THE COURT: That is correct. May I have a moment? You may.

MR. GOODREID: THE COURT:

Thank you.

MR. GOODREID: THE COURT: MR. GAINOR:

No objection, your Honor.

Or by Mr. Lewis? No objection, your Honor.

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THE COURT:

Very well.

Smith Exhibit 3 for

identification admitted in evidence, with leave to publish. MR. O'DONNELL: Norm L. Sirak letter. The next one would be Smith No. 4, the

And I believe that is our trial It is our

deposition -- that's our trial deposition No. 4. deposition Exhibit No. D1.

And it is -- that's all we need.

I can point out where we talked about it in the deposition and identified it, et cetera, but I don't think we need that at this point. THE COURT: It is my understanding that defendant Smith

is offering Smith Exhibit 4. Any objection by the government? MR. ANGELO: There is, your Honor. There hasn't been a

foundation established for the purposes of this particular exhibit that Mr. Smith relied upon it. Secondly, your Honor, I would note for the court that this in effect constitutes an unendorsed expert witness, which we object to. And it is also hearsay. Objections by or on behalf of Mr. Schmidt? No objection, your Honor.

THE COURT:

MR. HAMMOND: THE COURT:

On behalf of Mr. Weed? No, your Honor.

MR. GOODREID: THE COURT: MR. GAINOR: THE COURT:

On behalf of Mr. Lewis? No, your Honor. Response to the government's objection by

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Mr. Smith? MR. O'DONNELL: The hearsay objection we believe would

be a -- that is provided as, quote, part of the program with accumulated evidence that we have to date. this have come in quite readily. Many exhibits like

They have been identified as

part of the program as in issue in this case. It was addressed to Gary Herbert, attorney for the company. It was then sent out to my client. And we will

connect it up when he testifies that he received it and relied upon it. The handwriting on there was identified as Mr. Michael Smith's handwriting, so that he could get the proper address and phone number so that he could actually contact Norman Sirak to make sure it was genuine. That will be connected up later.

At this time, your Honor, we think that the objections on balance should be overruled. THE COURT: MR. ANGELO: Reply by the government. I need not reply, your Honor. We will

stand on our objection. THE COURT: Smith's Exhibit 4. Mr. O'Donnell, your recollection or offer of proof as to the date of investment by Mr. Smith. MR. O'DONNELL: THE COURT: Excuse me. Date of what? Indulge me momentarily while I review

The date that Mr. Smith invested in the

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program. MR. O'DONNELL: it was February. It antedates this substantially by --

Of '02. Then the following objections are

THE COURT: sustained.

Rule 401 and 402, 801(c), and 702.

And for now, Smith Exhibit 4 is not admitted in evidence. Further proffers on behalf of Mr. Smith, Mr. O'Donnell? MR. O'DONNELL: our -- oops, wrong book. Yes, your Honor. Excuse me. We then turn to E in

The exhibit that I am It is not

discussing now, your Honor, is No. E, Smith Exhibit. listed as a trial exhibit.

We thought that the deposition

exhibits would stand as trial exhibits because -THE COURT: Do you have the exhibit in paper form which

may now be marked as a Smith trial exhibit? MR. O'DONNELL: THE COURT: Yes, I do.

If you would, please. Next in order would be 33, your Honor,

MR. O'DONNELL: Smith 33. THE COURT:

And again for the record it coincides with

which Herbert deposition number or letter utilized by Mr. Smith? E? MR. O'DONNELL: E. There is also attached to it the

fax transmission verification report that it was sent to Mike Smith at --

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THE COURT:

Well, let's not testify through counsel

concerning perhaps important substantive information in an exhibit not yet identified. I presume you are offering Smith Exhibit 33 consisting of two pages? MR. O'DONNELL: THE COURT: Yes, your Honor.

And Smith Exhibit 33, as we have noted,

corresponds with Smith Herbert deposition Exhibit E; is that correct? MR. O'DONNELL: THE COURT: MR. ANGELO: first, your Honor? THE COURT: You may. Thank you. And then I will suppose that E, yes, as in elephant.

Any objection by the government? If we can take a look at the exhibit

Counsel, all of you may. you insist that I do the same.

Mrs. Kramer, if you will stand by on my behalf, please. Thank you. Any objection by the government? MR. ANGELO: Only as to that portion we offered Exhibit

No. 33, formerly Exhibit E, which is the fax header, your Honor. The dates do not correspond. The actual letter itself, which is

represented by Exhibit No. 33, we have no objection to. THE COURT: Any objection on behalf of Mr. Schmidt? Yes, your Honor, on the grounds of

MR. HAMMOND:

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foundation. THE COURT: Any objection on behalf of Mr. Weed? No, your Honor.

MR. GOODREID: THE COURT: MR. GAINOR: Mr. Hammond. THE COURT:

On behalf of Mr. Lewis? Yes, your Honor. Same grounds as cited by

Response on behalf of Mr. Smith? As to the header, we don't mind

MR. O'DONNELL:

redacting that, your Honor. THE COURT: Well -As to the foundation, I think it's been

MR. O'DONNELL:

thoroughly discussed and verified by the deponent, which we have listened to now for a day and a half, and that the further use would be as to -- was there a hearsay objection? hearsay. THE COURT: Sh, no. There wasn't. I always talk too Nobody said

MR. O'DONNELL: much. MR. GAINOR: well. MR. O'DONNELL:

I will be quiet.

We do interpose a hearsay objection as

I grabbed a big book to see where that

one is where you don't have to have hearsay if it's designed to create activity on the part of a certain party, which would be my client, and that's what it was, and it was part of the program also.

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That's the Norman L. Sirak letter. THE COURT: Mr. O'Donnell, the stream of consciousness

technique was only effective by the poet T.S. Eliot in The Love Song of J. Alfred Prufrock. Perhaps you ladies and gentlemen are familiar with it. Any further response? MR. O'DONNELL: THE COURT: Oh, from me?

Yes. It would be a non-hearsay item that was

MR. O'DONNELL:

designed to create activity on the part of my client, and he did rely on it, and he did use it, and it was given to him for that purpose. THE COURT: The court's ruling taken under advisement

concerning Smith's Exhibit 33. Any other proffer by defendant Smith related to the Herbert video deposition? MR. O'DONNELL: hand, your Honor. THE COURT: Any other exhibits? Oh, hang on. The exhibits that you have in your

MR. O'DONNELL: THE COURT:

I have cleverly bought time to more closely

review Smith Exhibit 33 so as not to further delay or inconvenience the jury. MR. O'DONNELL: Oh, okay. Then the only other one we

have, your Honor, would be our J13, Smith J, page 13.

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THE COURT:

And how will it be marked as a Smith trial

MR. O'DONNELL: THE COURT:

I have got that here.

34, I presume? 34, Judge. I will put that on right

MR. O'DONNELL:

now, and I will bring it to you or I will have the clerk brought to you. THE COURT: Before you have it brought to me, if you

will circulate it among curious counsel. And is this the last deposition exhibit to be offered for consideration by Mr. Smith? MR. O'DONNELL: THE COURT: Yes. Then let's do this.

Thank you.

Counsel, we can do this at the close of business today, and you will have the benefit of the court's ruling at that same time or bright and early tomorrow morning. And with that, Mr. O'Donnell, I am going to ask that you be seated. And I inquire of the government if it is prepared to proceed, it may call its next witness. MR. ANGELO: Brittain. THE COURT: Thank you. If you will come forward We are, your Honor. We would call Steven

Mr. Brittain, good afternoon. to be sworn by the court.

To accomplish that, if you will come

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forward and stand in this open area in front of my bench, please. About there is fine. I am going to administer the oath. and raise your right hand to be sworn. If you will face me

And thank you.

May I have your attention in the courtroom. (Stephen Brittain was sworn.) THE WITNESS: THE COURT: witness stand. Yes, Judge. Please be seated in that

Thank you.

And again good afternoon. Good afternoon.

THE WITNESS: THE COURT:

As you testify, sir, please use the

microphone in front of you, and by its peculiar design, a speaking distance of about six to eight inches works best. THE WITNESS: THE COURT: Okay.

Thank you. DIRECT EXAMINATION

BY MR. ANGELO: Q Would you state your first and last name and spell both,

please? A Q A Q A Stephen W. Brittain, S-T-E-P-H-E-N, B-R-I-T-T-A-I-N. Mr. Brittain, where do you currently reside? In Palm Springs, California. What do you do in Palm Springs? I have a business called Senior Benefits Insurance and

Financial Services.

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Q A Q A Q A Q A

Stephen Brittain - Direct What kind of products do you sell through that? Mainly annuities and life insurance. Mr. Brittain, do you know the defendant Mike Smith? Yes. How long have you known him? Since about '98, '99. Can you describe your relationship with Mr. Smith? Um, one of the agents who worked out of my office found a

product that Mr. Smith sold, and asked if I would let him sell it, and that's how I met him. I never met him face-to-face

until a few years later, but my communication with him was in relation to getting companies to sell product. Q A And have you in fact met Mr. Smith at his home before? Yes. The Jeff Bedelady from Spokane, one of the guys worked

in my office, had moved up to Spokane, and I went up for his wedding. Q A Q A Q That's the first time I met him.

Have you stayed at Mr. Smith's house? Yes. Do you consider yourself a friend of his? Yes. Do you recall Mr. Smith addressing with you in the year of

2002, a potential investment? A Q Yes. Concerning an investment in medium-term note trading, or do

you recall?

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Stephen Brittain - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q Yes. Okay. And what do you recall about what he told you about

that initially? A Well, I -- with -- on this deal I didn't really listen to it Mike was a friend of mine. Jeff, who worked in my

a lot.

office, was -- they told me it was a good deal. MR. HAMMOND: grounds of hearsay. THE COURT: MR. ANGELO: And response? Your Honor, among other things, I would Your Honor, I will have to object on

cite to the court Krohn, as well as 801(d)(2)(A) for Mr. Smith. THE COURT: Mr. Smith? MR. ANGELO: THE COURT: I am at this time, your Honor. Very well. That being the proffer, ladies Well, are you limiting the proffer to

and gentlemen, please be instructed the objection is overruled, but you may consider this question and answer only as it pertains to Mr. Smith, and to no other defendant. so instructed. Thank you. And you are

Where are we in the exchange? MR. ANGELO: THE COURT: BY MR. ANGELO: Q A What did Mr. Smith tell you about this? He told me it was a program that was going to be in the I can re-ask the question, your Honor. If you would, please.

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Stephen Brittain - Direct banking industry, and that it was a chance for us to make some nice money without any risk. And the returns were going to be

very nice, and the fact that he would be watching it very closely himself. Q Now, were your initials conversations with Mr. Smith about

this by telephone? A Q Yes. And over how long a period of time did you discuss this

potential investment with Mr. Smith by telephone? A He had mentioned it a couple of times. Most of my dealings

were not with Mike.

Most of my times when I did call the

business I did with him was done talking to Jeffrey. Q A Okay. And sometimes Mike would get on say, hi, how is it going, And when that happened,

and thanks for business you sent me.

which wasn't that often, it would come up again, hey, I still have that program, do you want to hear more about it. probably three or four months. Q Now, let me ask the clerk to show you what's been marked as So it was

Government's Exhibit No. 530. A Q Yes, sir. Now, Mr. Brittain, do you recognize what Government's

Exhibit No. 530 is? A Q Yes. How do you recognize it?

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A

Stephen Brittain - Direct It's a contract I signed to purchase the -- to go into the

investment. Q A Q A Q All right. And the investment is in what entity?

In capital Holdings. And what was the date of your signature on that document? August 22nd. Mr. Brittain, can you tell us, please, where you received

the contract document from? A It came from Mike Smith. He sent it to me in the mail, and

I filled it out and sent it in. Q Now, did you in fact meet with him face-to-face before

signing this contract? A Q Yes. And with respect to that meeting, can you describe it for

us, please? A I went up to Mike's. There was another business venture

that he wanted me to look at, and he told me, bring me up, take a look at it. I told him I probably wouldn't be interested, and

he said, take a little time, I want to show you the other thing I am talking to you about. And that's -- then went to that meeting, told him I wasn't going to do it. After the meeting, he said, how about

giving me an hour to sit down with you and show you this. I was tired of meetings. I had trusted Mike and Jeff

like I said earlier, and I said, tell me a little bit it, and

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Stephen Brittain - Direct more or less because they thought it was a good deal, and knowing my relationship with Mike and Jeff, I said, okay, let's do it. Q A Q Give me a couple of weeks to get the money together.

You didn't ask a lot of questions at that time? No. Now, after that particular meeting as you described

face-to-face with Mr. Smith, how long after that did you sign the contract that's been marked as Government's Exhibit No. 530? A Within a couple of weeks because I had to get the money from I filled

another location and the check cleared a certain bank. the application out for checking. MR. ANGELO:

Your Honor, at this time I move for the

admission of Government's Exhibit No. 530. THE JUROR: THE COURT: accepted. Again, I am sorry. Again, your apology is appreciated and

On behalf of everyone, though, we request a more

clever ring tone. The government has offered Government's Exhibit 530 in evidence. Any objection by any one or more of the defendants? MR. HAMMOND: THE COURT: Brief voir dire, your Honor?

Very brief, yes. EXAMINATION

BY MR. HAMMOND: Q Sir, as you look through the exhibit -- it is 11 pages,

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Stephen Brittain - Direct there are a number of places in the lower right-hand corner that have been in I should. initialed? A Q I don't believe so. Did you at some point get the contract back with the When you signed the contract, were they

initials? A Yes. MR. HAMMOND: THE COURT: On that basis, I don't object.

By any one or more of the other defendants?

Hearing none, Government's Exhibit 530 for identification admitted in evidence, with leave to publish. MR. ANGELO: Thank you, your Honor. We would ask that

the first page be published at this time. THE COURT: BY MR. ANGELO: Q Mr. Brittain, do you see that on the screen in front of you Very well. Thank you.

now? A Q Yes. Mr. Brittain, the date of your contract is August 23rd of

'02? A Q A Q Um-hm. Is that the date that you filled out the paperwork? No. I signed it on the 22nd. And with respect to that contract, and looking at

Okay.

that date, can you tell me how long before the time that you

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Stephen Brittain - Direct signed this contract you first discussed this investment with Michael Smith? A Like I say, it was a few weeks before that. When I got back

from that meeting where I decided to do the deal, I had to get my money out of an insurance policy, which came due in a few weeks. Q I am referring to telephone conversations now. What was the

first time, in relation to this contract, you recall this investment being discussed with Mr. Smith? A After I went back from the -- made the decision in Spokane,

went home, got the money, he sent me the paperwork, and I filled it out. Q I think I talked to him one once or twice. I am probably not being clear at this point.

I am sorry.

Looking at the date of this contract, which is what? A Q A Q The 22nd. Of what year? August 22nd. Okay. How long before you signed this contract did you

first discuss with Mr. Smith this potential investment by telephone? A Probably the day before because he sent me the application

and wanted me to, you know, fill it out, and he was going to walk me through how to fill out. MR. ANGELO: lead at this point. Your Honor, I am going to ask under 611 to

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Stephen Brittain - Direct THE COURT: Leave is granted, subject to additional objection. BY MR. ANGELO: Q Mr. Brittain, do you recall telling us you first discussed

this investment with Mr. Smith by telephone approximately five months before you signed the contract? A I said that earlier. It was in March when I talked to Mike

about the program. Q A And I am sorry if I misunderstood you. I said that earlier. I talked to him back when I first

talked to Mike about it, it was March. Q A Of what year, please? Of 2002. It was about four or five months before I signed

the contract. Q Now, you said to us that Mr. Smith said that he was going to

closely oversee this program? A Q Yes. What exactly did he say to you about how he was going to do

that? A Q There were a couple of other investments that I was in -We don't know about those. We want to know what he said

about this one. A It has reasons to it. The fact that we had some trouble

with those.

I didn't want -- I just wanted to make sure that

this was going to be safe.

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Q A

Stephen Brittain - Direct And what did Mr. Smith say he was going to do? Based on the other problems we had, I asked him, I said,

Mike, is this going to be safe this time, and he said, yeah, I will be involved in it, I will be taking care of it, the money will be in a U.S. Bank, and the money will be accounted for, da, da, da, da, da, da. I said, Mike, I don't need all that. You are going to

be handling it, you are going to make sure the money is there and it's not going to be run off with this time. Q A Q And you took that on faith? Yes, I did. Now, prior to the time that you signed this contract,

Government's Exhibit No. 530. A Q Um-hm. Did Mr. Smith ever talk to you about the existence of a

cease-and-desist order in Nebraska with respect to a related company called Smitty's Investments? A Q A Q A Q No. Would that have been important to you? Yeah. Do you know what a cease-and-desist order is? Oh, yeah. And prior to the time that you signed this contract, did

Mr. Smith ever tell you that one of the persons associated with Capital Holdings had a conviction for felony theft?

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Stephen Brittain - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q A Q A Q A Q A No. Would that have been important to you? Yes. How much did you invest? Total? Um-hm. 70,000. And what was -- was there more than one investment? Yeah. It was 50 on the first, and then a couple of weeks

later I sent another 20. Q Now, at the time that you talked with Mr. Smith about this

investment in Spokane, did he mention to you whether there was a limited time period for this particular investment program? A When we went into it, it was for a 13-month period. Is that

what you are asking? Q A Q A Q If that's what you recall. Yes. It was for a 13-month period.

Not longer than that? No, 13 months. And at the time that you first talked with Mr. Smith about

this, did you in fact -- or did he in fact tell you that he would tell you when to get out? A Q A Um-hm. Is that a yes? Yes, sir.

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Q

Stephen Brittain - Direct Did he explain to you how widely this investment was being

marketed? A He didn't -- he said it was going to be done mainly for It wasn't going to be put out to everybody.

friends and family.

And that was about it. And it was not -- I didn't -- and I usually have agents under me, and he didn't ask me to ask anybody else to sell or myself to sell. Q So it was just a small lot.

Did he mention the name of any famous people that you

recognized in conjunction with this investment? A There was a bunch of names, and I am terrible on names. But

I am not a hundred percent sure, but Bill Bradley. Q A Q A Q Who do you know Bill Bradley to be? Basketball player. Did you know him to be a senator at one point as well? Also a senator. Now, after you made your initial investment, I think you

said that you added another $20,000 to it? A Q A Yes. And what made you feel comfortable about doing that? Well, the original that was going to be -- it was going to It

be originally 70, but like I said, I had to get the money. came from two different sources. And the one check came in

first and the other check came in later. that.

So I just waited for

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Q

Stephen Brittain - Direct Let's take a look, if we can, at Government's Exhibit No.

5 -- excuse me -- 531, I believe, your Honor. A Q A Q A Okay. Do you have that document in front of you? Yes, I do. What is that document? It's a copy of a check at Capital Holdings from me dated

August 22nd, 2002. Q A Q A And when you executed this check, what did you do with it? I mailed it in. And to whom did you mail it? Um, came in a self-addressed envelope. I just put it in

there to Norm Schmidt.

I made a copy, and anything I do with

Mike I always send them a copy of everything I do. Q And do you know where that self-addressed envelope came

from? A I am assuming it came from -- no, I don't. It either came

from Mike because I went through Mike's office one night for the paperwork. Q So I assume it came from Mike's office.

If you went through Mike's office for the paperwork, did you

consistently receive paperwork from that office? A I had sent always -- anything with Mike I had done I sent

everything to him, and everything back and forth through our offices. So I assume everything came to him or he at least had

a copy of everything going to him.

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Stephen Brittain - Direct MR. ANGELO: Your Honor, at this time we move for the admission of Government's Exhibit 531. THE COURT: defendants? Hearing none, Government's Exhibit No. 531 marked for identification admitted in evidence, with leave to publish. MR. ANGELO: THE COURT: BY MR. ANGELO: Q After investing your $70,000, did you take any monies out of Thank you, your Honor. You are welcome. Any objection by any one or more of the

the investment? A Q A No, sir. Why not? I was letting it build to its maximum it could build in a

13-month period. Q And what was your understanding of the rate of return that

you would be receiving on that investment? A Nine percent. Originally it was ten, and then it was

changed to nine. Q A Q A Nine percent per what? Month. And did you have plans for the growth of that money? It was to give back some of the stuff I had lost. My kids'

education fund and all that stuff. Q Did you receive a phone call from Mike Smith in March of

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Stephen Brittain - Direct 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 BY MR. O'DONNELL: Q A Q A Q Good afternoon, sir. Good afternoon. We have not met before today, have we? No, sir. And we have a person here who yourself being a friend of 2003? A Q Yes. And what was the purpose of the phone call as he explained

it to you? A He was letting me know that there was an unforeseen problem He was on top of it.

in Capital Holdings, but not to panic yet.

He would keep me abreast of what was going on. Q A Did he suggest to you that you get out at that point? Yes. MR. ANGELO: THE COURT: I have no other questions, your Honor. Very well.

Examination on behalf of Mr. Smith by Mr. O'Donnell. MR. O'DONNELL: THE COURT: Thank you, Judge.

You are welcome. CROSS-EXAMINATION

Mr. Smith's? A Q Yes, that's correct. Okay. And you have had dealings with him previously. Are

you still doing business with Mr. Smith?

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Stephen Brittain - Cross 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A Q Yes. What's the nature of your business? You mentioned

annuities? A I sell life insurance, life insurance, and annuities through

different insurance carriers. Q A Q How long have you been in that field? Since 1970. And in that field, do you place some of your insurance

through a company that Mr. Smith works for? A Yes. Not that he worked for. In our industry we have He

tiered structure, higher up the ladder, bigger contracts. has what's called the marketing contract.

If I want to sell for He has the He

him, he pushes me up whatever level he feels.

highest level, and he doesn't actually work for the company. is an agent for them. just one company. Q A You do a substantial amount of business with Mr. Smith? Not as much as I used to, and that's because things slow

So I work with different companies, not

down and laws changing in California and stuff like that. Q In the field you are in, the insurance field, you are aware

of the concept of an insurable peril or not? A That's not as much as in the life insurance industry as it

is in something else. Q A Okay. But what I basically do is I set down with families and show

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Stephen Brittain - Cross them how to use life insurance and annuities as a safe guaranteed investment with a nice steady rate of return, and that is it. And they have accessibility to life insurance. mainly about that person having to die. either you live or die. So it's

So that's the risk,

If you live, you have cash to spend. So that's mainly

If you die, your family has the cash to spend. what I do. Q

And of course you have no control over the insurable peril

of death? A Q A Q No. That's what I was getting at. No. Along that line, I wanted to ask you if you knew in the

program that you joined through Mr. Smith, was there insurance represented to you as being available? A Q Yes. And in that regard, did he show you a letter from an

attorney by the name of Gary Herbert? A Q There was a letter showed, yeah. Okay. And if you could look at Smith Exhibit No. 3, please.

Do you have that before you? A Q A Yes, I do. To whom is that letter made out? Mr. Smith. Who is it addressed to?

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Q A Q A Q

Stephen Brittain - Cross And who is it from? Gary Herbert. Do you know him to be a licensed attorney? No. I don't know him at all. Do you remember the contents of the letter at all as

Okay.

you sit here today? A Q No, sir. Okay. But you knew that there was six layers of possible

insurance on this program; is that correct? A It was never explained to me that way. Mike just told me As soon as it gets And

there was going to be an insurance policy.

in, he will send me a copy of the dec pages, which he did. that was it. It was like $280 each so. That's all I know.

Like I said, to make the deal even safer, there would be some type of insurance. Q Okay. The follow on that I need to pursue is with your Did you know at this time that there Let's say you were trading on Do you

knowledge of insurance.

would be no insurance for losses.

the stock market and you happen to lose money. understand that or not? A

The type of insurance that I do, like I said previously, is There is different types of insurance. That's

life insurance.

more into the casualty and other side of the industry, which is totally a hundred percent different, and I do not understand that side at all.

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Stephen Brittain - Cross But there is risk. And if you are asking about stock, there is risk in the stocks, whereas with my life insurance program, there is no risk. It's all guaranteed. But I do not

understand the law on the $200 million policy. Q Well, I guess I have to ask it this way. Did you know or

understand that if there was a business trading loss in a marketplace, that that could not be insured? A No. When Mike said that he was -- that we were going to

lower the interest rate to have the insurance, which, like I said, it was a good return to start with, whatever Mike and Jeff were going to do, I was going along with the whole ride anyway. But the insurance was to make the program that much safer. That's all I know. discussion on it. Q Okay. The discussions that you had with Mr. Smith regarding We didn't get into a lot of hassle or

this program, apparently you did not do your own due diligence, but you relied on Mr. Smith's due diligence; is that correct? A Q A That's correct. And Mr. Schlabach I think was involved in that also? I met John once, and I didn't know John real well, but John John was going to help Mike keep track of it.

was involved. Q A Q

He is pretty much in the accounting end; is that correct? Correct. And then if Mike had known about a felony theft conviction

of somebody, do you think he would have told you?

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Stephen Brittain - Cross MR. ANGELO: Objection, your Honor.

Foundation, state

THE COURT: BY MR. O'DONNELL: Q

Sustained.

Do you know Mike Smith well enough to know his reputation in

your community, the insurance community? A Um, I know Mike from doing business from what I have. I

never had any problems with Mike.

Mike is probably the best I

have ever seen at putting materials together. I mean he puts out, when you contract with him, he gives you the right materials, beautiful materials to work with. I never heard a bad thing about Mike at all. I do business with him. That's one reason

Because he does a very good, you know,

from the life insurance side, it's very quality work. MR. ANGELO: Objection, your Honor. We are mixing

apples and oranges here.

If Mr. O'Donnell is trying to be a

character witness, he can ask his reputation in the community. He is mixing both. THE COURT: The objection is sustained under Rule

BY MR. O'DONNELL: Q And do you know Mike's -THE COURT: interruption. BY MR. O'DONNELL: Excuse me. And Rule 405. Excuse the

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Q

Stephen Brittain - Cross With regard to that, do you know Mike's reputation in the

insurance community as a reputation rather than just as your personal dealings? A Um, I am in California. Mike is in Washington. Mike does a

whole lot more, and the people who work with Mike up there do a whole lot more than I get down in California. far away. He does seminars and everything there, and has been in California to help me out. I never heard any problems or a bad Because it's so

thing about him with all the people you go to school with or anything like that and all the seminars we go to. Q I was trying to build up to the following question. Does he

have a good reputation for honesty? A As far as I know, yes. MR. ANGELO: Honor. Objection. Foundation at this point, your

I haven't heard enough to let me or have me feel

comfortable that he has a foundation for answering the question. THE COURT: after. Well, you can do this either before or

And now we will challenge Mr. O'Donnell to clean up. For now the objection is overruled and the testimony is

admitted under Rule 104(b). MR. O'DONNELL: THE COURT: May I continue? Thank you.

You may.

MR. O'DONNELL: BY MR. O'DONNELL:

Thank you, Judge.

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Q

Stephen Brittain - Cross With regard to telling you when to get out of the

investment -THE COURT: Mr. O'Donnell, excuse me. This now

requires you to ask how it is that this man knows of the reputation of Mr. Smith for honesty. Otherwise, the

government's objection is well taken and will be sustained. MR. O'DONNELL: BY MR. O'DONNELL: Q A How do you know about his reputation for honesty? Mike has asked me to come to different schools, to see I am not Thank you, Judge. Thank you.

different opportunities with different investments. the only person there he asked to come. people in our industry that was there.

There was a lot of That's why I know from

there were other people that meet him with as to his reputation. Like I say, I had no problems with Mike at all. MR. ANGELO: Objection, your Honor. I am going to ask He is talking

that the answer be stricken.

It's unresponsive.

about a matter of opinion rather than reputation. THE COURT: Well, I will sustain your objection on

grounds of relevance at this point and under Rule 405. BY MR. O'DONNELL: Q With regard to the other people that you were at meetings

with, were you able to gain what they thought of Mike's reputation? A Like I said, nobody ever said anything bad about him. It

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Stephen Brittain - Cross was always positive. It was always good. there.

That's why we were

Mike always put on a high-quality program. THE COURT: Sir, excuse me. You are going to save us a

awful lot of time and trouble if you listen carefully to counsel's question and answer only the question he asked you. In some instances the questions may be initially answered with a simple yes or no, and then counsel will supplement the examination. THE WITNESS: THE COURT: Thank you, sir.

Mr. O'Donnell. Thank you, Judge.

MR. O'DONNELL: BY MR. O'DONNELL: Q

Follow on, if I may, while you are at these meetings and

seminars, were you able to tell from people in your industry what they thought of Mike's reputation? A Q A Yes. And what was that? Like I said, Mike -MR. ANGELO: Objection, your Honor. The question has

to be narrowly confined to what he knows about the reputation, not the specific answers or statements. THE COURT: Sustained. Mr. O'Donnell, we are doing

business strictly under Rule 405. MR. O'DONNELL: THE COURT: I understand, your Honor.

Very well.

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Stephen Brittain - Cross MR. O'DONNELL: I thought I was there. I must continue, Judge. BY MR. O'DONNELL: Q Thank you.

I must say that

When you are answering this question, and this is

Mr. Stuckey's last question, the question is not what you know and not how you personally see it, but the reputation in his community, i.e. the insurance people that deal with him. know what that reputation is? A Q Yes. Can you tell us, what is his reputation in his industry Yes or no. Do you

community? A With my dealings, and with everything I have been to,

everybody thought very highly of him, and thought he did a very good act. MR. ANGELO: Objection, your Honor. That answer is

again relying upon a different animals which is his dealings rather than reputation. THE COURT: Relevance under Rule 401, 402, and of The objection is

course, the 405 is implicated adversely. sustained. BY MR. O'DONNELL: Q

Is it fair to say that you do not know his reputation, you

only know your personal dealings? A Q Yes. Based on your personal knowledge, do you -- can you describe

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Stephen Brittain - Cross Mike's opinion and your personal opinion from your own personal knowledge? MR. ANGELO: Your Honor, that's a compound question. I

think we need a simple question here. THE COURT: The form of the question is objectionable.

If you will simply deconstruct that, and ask one question at a time, please. MR. O'DONNELL: BY MR. O'DONNELL: Q Can you tell us from your own personal knowledge your Okay.

opinion that would describe Michael Duane Smith? A Mike in my opinion is a quality person who does good work He has done me right

for what I am looking for in my business. on every deal I have ever done.

Treats my clients right, and So I have a very

gives me the materials I need to work with.

good opinion of Mike in my professional opinion. Q Thank you. With regard to the famous people, did Mike Smith

mention to you the name Tom McMillan? A It could have been Tom McMillan. It was some famous person. Could have been Bill Like I said earlier, Bill

Bradley.

Bradley stuck in my mind. Q A Q A

McMillan could have been said too.

Could he have said that as being Tom McMillan? It could have been, sir. I couldn't hear you. I could have got it confused. He could have said that. He

Cas