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.
It's a gloomy day at the courthouse and there is one person here who has cause to be gloomier than the rest. Last night, Michigan Department of Corrections officials went to Kwame Kilpatrick's mother's home on LaSalle Street here in Detroit.
Kwame is back on a tether for failing to disclose a $2,000 gift in December from Chicago pastor Corey Brooks. Kilpatrick was shown on a Chesterfield Township Wal-Mart surveillance video counting out the received funds. He kept $800 and sent the rest to his family in Texas.
No more trips back to Texas for Kwame who is not allowed to travel as a result of violating his parole. So if he's not at the courthouse for the trial or meeting with his lawyers, he's hanging at his mother's house. Last night Kwame tweeted: "Can't count all the blessings, words of encouragement and well wishes I've received 2night. Thank U ... Love yall back! #djangochained4now."
9:03AM Video is on and there is Kwame sitting at the defendants' table. He's standing up and I'm looking for the tether. Can't say that I see anything but he is wearing long suit pants. Kwame seems in surprisingly good spirits as he talks his lawyer Jim Thomas. So we got a new court order today that pretty much prohibits media from talking to trial counsel anywhere on the 8th floor where Judge Nancy Edmunds's courtroom is. That was the unofficial understanding before the order but seems there was a spectacular showdown of sorts between a reporter and one of the defense lawyers yesterday that resulted in us all receiving the order this morning.
9:11AM Still waiting for things to get started. Can only assume the delay has something to do with the crazy traffic due to all the flooded roads.
9:15AM Judge just came in and says that the delay has to do with bad traffic problems. Jurors are entering the courtroom. We will be continuing with Kwame's lawyer Jim Thomas's cross-examination of star witness Derrick Miller. Judge addresses a clarifying instruction for the jurors. Wants to clarify law for 501c4 tax exempt organizations like the Kilpatrick Civic Fund. She says that donor lists for 501c4s are not required by law to be disclosed to the public. Thomas continues his cross. Talking about April 2001 when Miller was vice-chair of the Civic Fund. Looking at the newspaper article from August 29th 2001 about homeless shelter operator Jon Rutherford’s $50,000 donation to the Civic Fund. Thomas says that before the article came out Miller met with Kilpatrick and lawyer William Phillips on how to handle the story. Thomas says that the Kilpatrick administration would be aware of stories before they appeared because often journalists/reporters would call for comment on their stories. Miller acknowledges they were aware of the story before it came out and there were discussions about it. Thomas says was it your testimony that there was not going to be a disclosure about the amount or who gave to the Civic Fund. Miller says yes they discussed that. Thomas says because it is not required by law to disclose donors. Thomas and Miller butting heads about his direct testimony. Thomas saying he is only asking about the news story and not the mayoral debate. US Attorney Mark Chutkow objects to line of questioning. Thomas is saying that he is attempting to address inconsistencies in the witness's testimony in what would seem to be an attempt to impeach him. We've got a mini sidebar going on with Chutkow, Thomas, prosecutor Michael Bullotta and the judge. Thomas says that Rutherford's company DPR Management LLC was disclosed on April 26 2001 as having donated $40,000 to the Civic Fun d by someone in the Kilpatrick administration. Thomas says the 990 form was filed which are typically used to disclose certain info to the government related to money coming in. Also the list of people contributing. Thomas says it wasn't a secret for the government because it was filed. It was filed for the state.
"It wasn't meant to be filed. It was a mistake," says Miller. Thomas says Miller also talked in his direct testimony about Rutherford's company DPR donating to Next Generation Detroit. Thomas says that Miller was shown exhibit #8 which was withdrawn by the government because it is no longer relevant. Thomas says Miller testified under oath that the check went to Next Generation Detroit. Thomas says that Kwame asked him for that money. Thomas asks if miller sees the word "Generation PAC". Miller says he does not. Thomas says Miller testified that he thought this was something affiliated to Kilpatrick. Miller says he did. The check was withdrawn by the government yesterday because they realized that Next Generation Detroit had nothing to do with Kwame. Thomas trying to prove that Miller is just going along with anything the government is putting out there.
9:35AM Thomas says that didn't you say that this contribution was around the time Kwame was running for mayor and that the $34,000 was the limit for campaign donations. Thomas asks if he didn't try to make a link. "During my testimony I might have inferred," says Miller. Thomas asks "Are you going to apologize?" "I can apologize if that's what you would like," says Miller. Chutkow objects that Thomas is being argumentative. Judge sustains. Miller says it's not true that Generation PAC, Kwame's organization, and Next Generation Detroit are the same. Miller saying that he doesn't know if the check was cashed. It's obvious that Miller didn't notice the mistake. Thomas clearly trying to point out that either he is trying to please prosecutors or he is not paying close enough attention to factual detail in his testimony. Thomas says Miller was originally charge by feds with racketeering in December 2010. Miller says he doesn't remember all the charges.
"Are you telling me as you sit here today that you don't remember that racketeering was one of the charges," says Thomas. "If that's one of the charges, ok," replies Miller. Thomas incredulous that Miller would require him to confirm what the charges against him were. Verbal exchanges between Miller and Thomas are getting pretty heated. Thomas asks where miller was when he first knew he was indicted. "I believe I was in Virginia," says Miller. Miller says he thinks he heard through his attorney. Thomas says Miller hired an attorney before December 2010 because he knew he was being investigated by the feds. Miller agrees. Thomas says that on July 2010 Miller had several interviews with feds. Miller acknowledges that this is true. Thomas asks if the meetings with agents were attempts to avoid being charged. "Not necessarily, no," says Miller. Thomas asked if Miller or his lawyer talked with feds. Miller says both. What about Tim Cook or Mark Talley asks Thomas. Miller says it is himself who is quoted in the documents. On Detroit Building Authority, River Front Conservancy, DWSD, Baby Creek, Miller says it is he who talked about all these Thomas says that prior to talking with feds, Miller entered into Castigar agreement with them. Required him to tell the whole truth and even volunteer information if they hadn't asked.
Thomas says feds were attempting to evaluate if Miller could be a good witness in this current case. Miller agrees. Thomas says feds asked questions about things they wanted to hear about. Correct says Miller. Thomas says Miller had a hope to make a deal in exchange for his testimony. Miller saying that he isn't sure what his strategy with his attorney was. "Are you hiding behind client attorney privilege?" asks Thomas. Miller says his personal intention was to see what the feds had and what they knew. Says those were his intentions. Thomas asks about how he figured out those intentions over 5 interviews in July and August 2010. Asks if feds told him he was in trouble. Miller says they told him they were investigating him and where he improperly took cash for influence. Thomas asks if they told him they were interested in having him testify against Kwame. Not at that time says Miller. But he says they did ask questions about him.
9:55AM Thomas asks if Miller knows Dedan Milton. Miller says yes. Miller says he wasn't in touch with Dedan in the summer of 2011 and hadn't been in touch with him for some time. Miller says he is aware Milton went to prison but didn't know the length of time. It was 4 years.
Chutkow asks for a sidebar. And now we have a juror who took a quick bathroom break. Possibly TMI. Thomas gets ready to start but judge says we are still missing a juror. Thomas asks after first 5 meetings with government if Miller didn't get indicted. Miller says he has to see the indictment to know an exact date. Thomas asks if he knew feds were seeking indictment before it came. Miller says yes. Thomas asks if the feds told him that they thought he was lying and they didn't see any merit in calling him as a witness. Miller says no. Miller says it was a major undertaking at the time. Thomas says you know they had the power to send you to prison. Miller says yes. "And you're telling me you have no recollection of talking your way out of it?" asks Thomas. Thomas says he is asking about Miller's state of mind in the 5 conversations. Miller says he was feeling that he could go to jail , yes. Thomas says you were hoping to get something in return. Miller says that his attorney said that his trouble could be minimized. Thomas says meetings broke off after 5th interview. Miller says yes. Because government decided they didn't want to use you as a witness? That's not true says Miller. Thomas says you wanted to talk to them honestly about everything that occurred? "Not entirely," says Miller. He acknowledges that he was not completely honest with the feds. Thomas says you knew it was a crime to lie to an agent. Miller says his understanding of the Castigar was that he could minimize things "There were things I left out in the interview, yes. As related to your client in particular, yes," says Miller.
Miller says he was trying not to expose Kwame and that when he was asked about certain things he didn't tell the whole truth. Thomas says according to Castigar agreement, if Miller lied it could be used against him. Thomas says that miller was just trying not to get caught lying. Thomas says Miller didn't even mention Jones Lang Lasalle and Kwame until October 2011. Miller agrees. In direct testimony, Miller told the court about kicking back part of his own kickback from the real estate firm to Kwame. Thomas says after his 5 initial meetings, he was indicted. Miller says yes along with Kwame and others.Thomas says what is clear is that in October 2011, you are feeling the jeopardy more fully. By this point, Miller has been indicted and trial dates are being schedules. Thomas saying that Miller feeling significant chance he might go to jail on racketeering charges. "On all the charges, yes," says Miller. Thomas says it must have been on his mind that 5 initial meetings with feds netted him nothing but an indictment. Thomas says he must have wanted to do more to minimize his exposure.
10:15AM August 25th and September 12th 2011, Miller meets again with the feds. And then again in October and November 2011. Thomas takes a document and shows Miller all the dates he met with the feds. Miller says last time he talked with feds the trial was ongoing. Moving on to Karl Kado. Miller agrees that Kado was looking to do better in terms of Cobo opportunities. Thomas asks if Miller recalls a 2001 conversation with Conrad Mallett, Kilpatrick and Karl Kado talking about contributing to the campaign. Miller can't seem to recall. Thomas refers him back to an interview Miller had with feds on July 15th 2010 where he was asked about the meeting with Mallett, Kilpatrick and Kado. Miller says he can't recall. Miller now recalls the discussion about Kado funding campaign before Kilpatrick was mayor .So this is before Kilpatrick could have done anything for Kado? Yes says Miller. Miller remembers being sent by Kilpatrick to pick up something from Kado. Thomas says Kado gave you $10,000 in cash. Yes says Miller. Miller says he took it back to the campaign and he gave it either to Christine Beatty or Kwame. Thomas says you have no idea if that money went into the campaign or not. No says Miller. Thomas asking how much money Kado gave to Miller. Miller says there were several other times and sometimes it was $10,000, other times it was $5,000 to $10,000 in cash. Miller says it was in cash, at Cobo and the denominations were hundreds. Miller agrees that at the time he was Chief Administrative Officer and that Lou Pavledes was at Cobo for awhile before he was replaced by Glenn Blanton. Thomas asking about second time he got money from Kado how it was packaged and who was running Cobo Hall. Miller says he can't recall. "I was compromised," says Miller about when he told the feds about the cash from Kado.
10:30AM Judge calls from 20 minute break.
10:53AM Seems that Kwame keeps messing with his tether. "This thing is like sandpaper!" Kwame was overheard saying. Can't imagine that is comfortable at all. Apparently the jurors are not very engaged today. It may be that 4 days of Miller on the stand is too much for them. Thomas taking up his cross again. Miller says he changed his job position in January 2006. As Chief Administrative Officer, miller agrees that his office on the 11th floor. Miller says he knows who Warren Evans was, the former Wayne County Sheriff. Miller agrees that he wasn't in the mayoral offices. Thomas asks when Miller first took money improperly. "I can't recall exactly when," says Miller. Was it Jones Lang Lasalle or some other person asks Thomas. I can't recall says Miller. Karl Kado could have been the other person. Miller agrees that he knew what he was doing was wrong when he took cash. Talking about Time Cook and Jones Lang Lasalle. Cook was a real estate broker. Miller had a sales license. Thomas says Miller engaged in a scheme with Cook to do lucrative city business. Mark Talley was with Jones Lang Lasalle. Cook, Talley and Miller met at a bar at the Antheneum hotel where it was suggested that Jones Lang Lasalle do a city deal. After Talley got his commissions, Cook would get his cash and then Miller would get his from Cook. Miller agrees that he was hiding the money that he was making from this deal. Miller agrees that he, Talley and Cook split commissions three way. Thomas says the deal changed and Talley got cut out and that the commission got split 50/50 between Cook and Miller. Miller says he doesn't know if that was true but that there was a falling out between Talley and Cook. "Are we unclear here?" asks Thomas. "I'm just making sure you're clear," answers Miller. Thomas says that Miller and Cook decided to cut Talley out of the deal. No replies Miller. Miller says that whatever came in he relied on cook to tell him. Thomas says Cook was a good friend of Miller's. Miller says he was friends with Cook but not good friends. Miller concedes that he was good enough friends with Cook to sit in a bar and scheme with about cutting Talley out of a deal. Now talking about local real estate businessman Robert Shumake of Inheritance Capital Group. Thomas asking about an under the table transaction with Shumake relating to GM real estate. Miller says it wasn't under the table. Miller says when Shumake first approached him it wasn't about Miller making some money. Thomas says that GM was trying to save money tax wise through the land deal. Miller agrees that so. Miller also agrees that he was in a unique position in the city to help Shumake. If GM sells that property, it's off their tax books so it behooved them to sell it and lease it back. Thomas says Miller knew all this when he talked to Shumake about getting city pension fund financing for the transaction. Miller agrees. Miller says Matt Cullen were friends and agrees that he kept from him that Shumake was interested in the GM property. Miller also concedes that the friendship did not stop him from helping Shumake so he could get paid. It was a $50 million sale and lease back deal says Thomas. It was large, yes says Miller. Miller saying that initially he had no expectation to get money from the deal.
11:15AM Thomas says Miller talked to Shumake and told him he had a chance with the deal and that he wanted money. "I want a commission. I want money," says Thomas about Miller telling Shumake. "After I left city government, yes," says Miller. Miller again saying he didn't have any expectation initially. But once he was leaving his job, he talked to city counsel John Johnson if there was a cooling period where he couldn't make money from city pension fund deals. When city counsel said it was ok, Miller went ahead with getting money from Shumake. Thomas asks if Miller recalls talking to Jeff Beasley and Dedan Milton about the deal. Miller says he does not. Thomas says the pension funds approval of the transaction is done before the deal goes through. I believe so says Miller. Miller says he did not tell Shumake he was going put in a good work with the pension fund board. Thomas says you said this in direct testimony. Miller said he did not. Miller says he may have introduced him to someone on the pension fund boards but he never talked on his behalf to the boards.
11:20AM Thomas saying that Chutkow asked Miller if he had introduced Shumake to anyone on the pension board and he said no. And now says Thomas he is saying he did. Thomas says that there is an inconsistency there. Miller said he didn't introduce in conjunction with the deal but it was just a general introduction. Thomas also saying that he said in direct testimony that he did put a good word in for Shumake with pension fund but now he is saying he didn't. Thomas hands miller a document to look at and Miller barely glances at it. Takes of his glasses puts them in his breast pocket and looks to judge for help with Thomas. Judge tells him to look over the document so Miller does. Miller rolls his eyes when he answers Thomas's next question. This is all getting a little confusing. Judge says Mr. Thomas just ask the question. "Does this refresh your recollection," asks Thomas. "As to what?" asks an irritated Judge Edmunds. On June 14th 2007, the city pension boards conditionally approved the deal. Miller didn't leave city government until the fall of 2007. Thomas says you know that Shumake had to be a know person to the boards before the deal was conditionally approved. Yes says Miller. Thomas says without the deal, Miller wouldn't make any money. Miller says when he was working for the city, if he introduced Shumake with the pension fund boards "it's just cuz I did." Thomas asks if Tim Cook was involved in the Shumake deal and if he got a commission of $50,000. Miller agrees that Cook got $50,000 "for providing information." Thomas says you gave that to Cook without any expectation of anything coming until after you left city of Detroit. Thomas says you got $500,000 as a result of a closing in December 2007. What would you call it? "A commission," says Miller. Thomas says that 6 months before the deal closes Miller interested in the deal for his commission. Thomas says he wouldn't have paid Cook $50,000 if he didn't have an expectation of commission while he was still working for the city of Detroit. "The months tend to blur," says Miller about the timing. "Well I want to unblur it," says Thomas.
Miller says it did cross his mind before he left the city and that's why he went to city counsel. "If he had told me I couldn't do it, I wouldn't have done it," says Miller. Thomas says he wants to talk about semantics. Miller says the possibility about getting commission did occur before he left the city because he want to talk to counsel. Miller says there was no clear understanding with Shumake about getting a commission. At some point before leaving, Miller says he did talk to corporation counsel about it. Sidebar called.
11:40AM Thomas grinning, "I have a good question for you." Asks if Miller had any understanding with Shumake at any point in time. Yes says Miller. Miller says he is not clear on the timing. "I don't know exactly." Miller says there was a possibility of getting a commission of 1percent on a $5 million deal. Thomas says miller had a disagreement with Shumake over commissions. Yes says Miller Thomas says you had a disagreement in public. Yes says Miller. Thomas says that the public disagreement was over commissions because Miller had a clear understanding over what he wanted out of the deal. Judge tells Thomas and Miller once again not to speak over each other. Thomas says that Shumake and Miller got into a physical confrontation outside of Mosaic restaurant that people saw. Miller says he didn't touch Shumake. "I was hot," says Miller. He agrees that it had to do with commission. Thomas asking about Cityvest. Miller says it was his company to help businesses. Thomas asks if Miller put any money into Cityvest when he was working for Detroit. No says Miller. Thomas says the Shumake commission was for Miller and not Cityvest. Miller says the commission didn't go to Cityvest. Thomas says Miller set up Atrium Financial to receive the commission to avoid people knowing about it. Miller says that is correct. Thomas says that Miller didn't want to be affiliated with the deal because he was working with the city of Detroit at the time. Miller says he didn't want it to come under scrutiny and did not want pension fund board members to know. Thomas says a lawyer set up this corporation for Miller so he could hide the $500,000 plus commission. The attorney in question was Shikha Hamilton, a friend married to another friend. Miller agrees that he wanted Hamilton to be associated with the company and not him. "Atrium Financial was nothing but a corporation that was a lie," say Thomas. Miller says he thought there was possibility of deals that Atrium could do in the future. Thomas says Miller's intention is that Hamilton perpetuate the lie. "She's a lawyer and you got her to do it," says Thomas. "I don't know if I got her to do it or she just did it," says Miller. Chutkow objecting again. Judge overrules objection but says we are dragging on with this. Thomas says feds subpoenaed Atrium Financial for records. Thomas says he did not give Hamilton $5 or $6 thousand, she was paid a salary. Thomas saying that Miller and Hamilton cooked up a false promissory note. Taking a look at a document that is for 2007-2008. Miller says he typed it up after Grand Jury subpoena of Atrium Financial records. Thomas says this was to hide the Shumake commission and that Miller did not want to put it as income in Cityvest because it would have been taxed. Miller agrees. Millers says the promissory note was intended to do all the things Thomas talked about. "To mislead? To misinform? To misdirect?" asks Thomas. Yes says Miller to all of it. Thomas asks if he paid Hamilton to do the note or he told her she was in trouble so had to do it. Miller says that's not true. Miller says he never got money from Adamo or Jim Stapleton or Mike Farrell.
12:00PM Judge says we are taking a 5 minute break
12:10PM Court back in session and lawyers go straight into sidebar. Now Thomas talking about Andrew Park and Dominic Pangborn and the SCAN project. Miller says he was Chief Information Officer at the time. Thomas says you saw that as opportunity. Miller says he didn't. But you got money from them. Miller says he did. Thomas says this was another instance of Miller figuring out a way to make money. Miller asked about when Kwame asked him to get money from Park and Pangborn. Miller says he thinks it was when he left city government but he is not sure. Thomas says so the idea was to hide the transaction. Miller says it was. Miller says he can't remember if Asian Village was up and running at the time. Miller says he met Kwame in the bathroom at Asian Village. Miller says Park may have given him the cash in the Dragon Room but he can't recall. Thomas asks about room furnishings and if people were in the restaurant. Miller can't recall. Miller agrees that he called Kwame on the phone and called him to come to the restaurant. "For the record, Mr. Kilpatrick is a pretty big guy," says Thomas. Thomas says Kwame is a big guy who is recognized when he walks down the street. So Thomas says, you bring Kwame to a restaurant? So you call Kwame to this place where he sent you to to do this inappropriate thing? Yes says Miller. Thomas says no one other than you can corroborate this is true. Miller agrees with that. Miller doesn't know if had received the SCAN funds at this point. Thomas is saying so Kwame came to the restaurant with his security staff and you gave him money? Yes says miller. Thomas saying that Miller asked Kwame to go to the bathroom because there were no security cameras there. Thomas asks for a moment to have a glass of water. Thomas says Miller entered into his plea agreement with the government in September 2011. Thomas asking if Miller knew there was a deadline on the agreement. I believe so says Miller but doesn't know why deadline was placed there. Miller agrees that plea agreement was drafted by the government. Thomas asking if feds told Miller he had to plead before he testified. Not that I recall says Miller. Thomas saying that Miller won't be sentenced until after his cooperation. Miller says yes.
12:30PM Thomas says that Miller has multiple counts against him and that Judge Emunds could stack the time when sentencing him. Miller aware of this. "You knew you were looking at basketball scores for sentence," says Thomas. Yes replies Miller. Thomas says family is most important thing in your life. "There are a lot of things important to me," says Miller. Miller says he knew that charges were coming. "You saw the government as a train at the end of the track and unless you got out of the way you would get hit," says Thomas. "Yes I will be testifying in hopes that i will get a sentence reduction," says Miller. Miller says his attorney does not agree with sentencing guidelines. Edmunds says that subject is not appropriate. Thomas says the fact that government is still able to put him in jail for more time beyond the plea agreement is still a concern. Miller agrees. Miller's racketeering charges have been eliminated. Miller understands that the maximum sentence is 10 years. So Thomas says he has minimized his exposure without racketeering charges. The guidelines call for 41 to 50 months. Thomas says you have in your mind that's there. "I have in my mind the best possible outcome," says Miller. Miller says he does have in his mind that the government can recommend less time and he hopes that happens. "Cooperation is cooperation. If they are happy or sad that's up for them to decide," says Miller. Thomas says won't you be disappointed if the government doesn't recommend a reduction. Yes says Miller. Miller says it's up to the government "to determine if his cooperation has been cooperative," says Miller. Thomas says Miller is hoping that his cooperation will make the government happy so that they recommend a reduction to the judge. Miller admits this is true. Thomas is finally done.
12:42PM Lawyers go into sidebar. Judge Edmunds says we are done for the day. Reminds jurors not to talk about the case and bids them a good weekend. Bobby Ferguson's lawyer Gerald Evelyn will begin his cross-examination of Miller Monday.