Local 4 is inside the courtroom for the federal corruption trial of former Detroit Mayor Kwame Kilpatrick, Kilpatrick's dad Bernard Kilpatrick and his childhood friend Bobby Ferguson. Each day we bring you information from inside federal court as it happens.
9:12AM And the late morning starts continue. New rules at the courthouse have media and the participants of the Kwame Kilpatrick standing in the long lines with people coming in for naturalization ceremonies on Mondays and Thursdays. Once upon a time we could get in through the back door with courthouse employees which would cut waiting time down substantially. As a result of the change, lawyers and defendants in the Kilpatrick trial are having trouble getting into the courthouse in time.
9:17AM Video just comes on. Someone neglected to turn on the video and the court session has already started. Former Soave Enterprises Vice-President Kathleen McCann is being cross-examined by Bobby Ferguson's lawyer Susan Van Dusen.
Van Dusen is talking about Ferguson being one of largest minority contractors thus it wouldn't be surprising for his name to come up. "Surprising because we hadn't chosen him," says McCann.
Van Dusen is talking about how Inland was prepared to give minority contractor Charlie Williams a 20% cut of water contract 1368. The defense lawyer says it wasn't until 2002 that Williams opened an office and took on an employee.
McCann says they were intending to help Williams build a large minority contracting firm through mentoring. It was going to be an evolutionary process where the company would be built up over time.
Van Dusen talking about a "pass through" relationship where one company takes from another. Van Duson describing Williams's company relationship to Inland. Van Dusen saying that pass through companies were being viewed in the industry as minority fronts. McCann acknowledges she knows what Van Dusen is talking about. "That's why we wanted nothing to do with that," says McCann. Van Dusen says it puts no income into the hands and pockets of Detroit families.
Van Dusen saying that employing residents of Detroit puts money back into the economy of Detroit. McCann agrees.
It seems the lawyer and the witnesses are at an impasse when it comes to pass through companies. McCann refusing to agree with Van Dusen on this point.
Van Dusen asking Inland had no intent of using its employees under Williams’s payroll. McCann says her answer is no. She says it is very possible to help build a company without it being the way that Van Dusen is describing it.
Van Duson now bringing up Ferguson who had his own equipment, more than 200 employees, the company had been in business for over 40 years. McCann agrees with all of this. McCann also agrees that Inland offer to mentor Ferguson and that he made it clear that he was not in need of mentoring.
Van Dusen saying he wanted to join this project "on his own 2 feet" and he made it clear to you? "I think there were mixed messages around that, honestly," says McCann. Van Dusen says he wasn't willing to be a pass through company. "I think those sort of comments are self-serving drama," says McCann about Ferguson. Van Dusen asking if McCann if she was taken aback by Ferguson's strength and energy. McCann says she was not. "He (Ferguson) didn't want our help," says McCann.
9:35AM Van Dusen stressing that Ferguson wanted no part of being mentored or a minority front. McCann says again there were mixed messages.
McCann says they understood Williams was out and Ferguson was in and that he had employees and equipment. McCann says about Van Dusen characterizing a "revenue stream" as pejorative is not something she would agree with.
Van Dusen saying that Inland wanted to use Williams to pass money through back to Inland. It's not true says McCann. "I know it today. I know it then," says McCann about not wanting to use Williams as a pass through.
McCann acknowledges that they knew Ferguson had a lot of projects in his portfolio.
Van Dusen hands McCann a document, a company pamphlet for Ferguson Enterprises, and asks if she remembers Ferguson giving it to her. "it's vaguely familiar," says McCann.
Kwame and Ferguson are whispering throughout the cross-examination.
Van Dusen talking about the various projects was involved in. Lists many multi-million dollar jobs including MGM temporary casino, Compuware.
Judge Nancy Edmunds says it's not appropriate to just read this into the record if the witness has no recollection of it.
Van Dusen reading from Ferguson's pamphlet about the different equipment his company owns. Van Dusen says he was fully stocked and didn't need to lease any equipment from Inland. McCann says there could have been more equipment that he needed but "this is an impressive list of equipment, no doubt."
Van Dusen asks if witness aggrees that Ferguson's unwillingness to be a pass through as the source of continuing negotiations with Inland. McCann disagrees with the defense lawyer.
Van Dusen saying that Ferguson determined to have his employees on the contract. Van Dusen saying negotiations involved employees, equipment, insurance and that it related to everything that had to be worked out between the parties. Through it all, what Ferguson wanted says Van Dusen, not to participate as revenue stream participant but to get profit. McCann says they had a very difficult time getting to contract resolution that had appropriate terms.
These ladies are not getting each other at all.
McCann says they wanted Ferguson to participate and earn a profit. Says he wanted 3% of $50 million contract not of work he performed.