Kilpatrick trial: Making payments to ease the pain

Federal corruption trial continues against former Detroit mayor Kwame Kilpatrick

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DETROIT - 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.

9:00AM Courtroom is full. Judge is entering the court. Everyone looks a little tired this morning- it's been a long week. Kwame Kilpatrick has good reason to feel a little somber today. Even though it's Friday, he has been prohibited from going home to Texas this weekend by his parole officer for falling behind on his restitution payments.

Watch: Billionaire businessman continues testimony in Kilpatrick trial

9:03AM Harold Gurewitz, lawyer for Kwame, is continuing his cross-examination of Tony Soave.

Soave confirms that MPS, a company he is involved in, generates somewhere between $35 to $50 million.

Gurewitz asking about an MPS executive who might have had access to the company jet. Soave saying it wouldn't be free, likely he would be charged for it. Soave saying that if he gave this Mr. Rickman the plane he could fill the plane any way he wanted to. Gurewitz asks if Kwame Kilpatrick was one of the first people that Rickman invited on the plane.

Looking at chart summary of flights. Soave saying that he can't tell from the log which flights were taken for personal purposes.

Gurewitz saying that city aviation tracked the flights and gave exact names at one point and that changed. Asks Soave if he knows when change occurred. Soave says he doesn't know. 

Asking about a flight on February 25th 2004 to DC. Saying that Kilpatrick went to DC to give testimony about blackout and asking if Soave knows about it. Soave says he doesn't know. 

Gurewitz asks about March 11th 2004 trip to Leesburg, VA, a suburb of DC, that Kilpatrick was on. Soave owns business interests there.

Gurewitz admits a page into evidence from the Soave Enterprises website about Brambleton.

Soave says Brambleton is a community of homes and a town center. Gurewitz reads that it is a 2,200 acre community 32 miles from DC. 

Soave remembers flying with Kwame to show him that development. Gurewitz says that Soave wanted to show him the development as an example of what could be done. Soave agrees. Gurewitz puts up a document that is a request for company plane for trip to Brambleton with passenger listed as Mayor Kilpatrick. Soave doesn't recognize it or know who would have submitted it. Soave saying that he remembers Kwame really liking one of the condo layouts at Brambleton. Gurewitz says that was in March 2004. Gurewitz says these trips follow blackout 2003.

Gurewitz asks if he remembers Mackinaw conference in June 2004, the 4th and 5th. Soave says he knows it and used to go. "I don't know why I used to go. I know why I don't go now. Too many politicians."

Soave says he went 3 or 4 times. Occasionally he took politicians with him including Brooks Patterson.

9:15AM in July 2004 there is a record of a flight from Detroit to East Hampton to Boston. July 24th was the date. Indicates the passengers as Kwame Kilpatrick, Dedans Milton and Sergeant Dwayne Love. Love testified earlier in the trial. He was part of the Executive Protection Unit for the former mayor and testified to travelling with him on private jets. At the bottom of the page it indicates Democratic Convention in Boston.

The request form shows approval signature of ALS- Anthony L. Soave. Soave agreeing that he thought the Democratic National Convention was an important event for Kwame to participate in. Gurewitz asks if he remembers promising to fly Kwame to political events. Soave says he doesn't remember but must have. Soave says he remembers Kwame being very involved in democratic politics. Now looking at chart log for May 19th 2006. Gurewitz asks about Dan Gilbert. Soave says he owns Quick and Loans and the Cleveland Cavaliers. Soave says he thinks he had a conversation with Kwame about talking to Gilbert about moving some of Quick and Loans back to Detroit. Vaguely recalls them going to a basketball together. Gurewitz says since that time some of Quack and Loans moved back to Detroit. Soave agrees: "Yes in a pretty significant way." Gurewitz asks if that trip was instrumental in the move happening. Soave says "I believe it was and I was happy to help."

Gurewitz now moves on to Naples, Florida. Asks about a condo and other properties owned by Soave there.

Gurewitz mentions Towers of Moraya Bay. Soave says it's a high rise, 72 units. Soave says there is also The Dunes there with 7 buildings and 600 units. also owns Regatta at Vanderbilt Beach. Bullotta objects. Judge says we've already been over this but Gurewitz says he is going somewhere different. Back to the flight log. Looking at a flight entry on round-trip from Detroit to Naples on December 27th 2006. Gurewitz asks if he remembers inviting Kwame on the trip. Soave says he remembers inviting him but not when.

Gurewitz asks if he wanted to show him the developments as something to emulate in Detroit. Soave says he remember showing him a few times.

Soave says he remembers talking to Kwame about how some similar condos could work in downtown Detroit between Ren Cen and Stroh's. 

9:31AM Soave using his hands a whole lot to gesture emphatically when answering Gurewitz questions. Soave saying that his financial people handled 1099s on the flights.

Gurewitz asking if the flights could have been a deduction for the company. Soave says he doesn't know. Soave does say that the financial people didn't want flights to be a political contribution.

So there was a concern that this could be viewed as a political contribution? Soave says they decided to handle it the way it was.

Soave agrees that an outside lawyer was hired to see if the flights could be viewed as a political contribution.

Gurewitz says that the company went on providing the use of the plane to Kilpatrick. Soave says he believes so.

Gurewitz asks if that's because the issue was resolved with his people. Soave says he doesn't know but they acted as they thought they should.

Soave says he didn't know at the time that logs of flights after 2006 were no longer being done.

Gurewitz asking about 2 NYC trips with Kwame. Asks if Soave went himself at any time on similar trips. Soave said that he did it more than once and agrees it was something he liked to do. "It was something I did often."

Soave agrees he told Kwame about the trips and took him willingly.

Now talking about those $10,000 floor seat NBA tickets he gave Kwame. Soave said someone contacted a broker for him for the tickets. He doesn't remember exactly how it happened. Soave says it was a big game that was nationally televised. "I wanted the mayor to be in the right seats. didn't want him in the 5th row."

Soave says "I liked Mayor Kilpatrick." He agrees he was generous with him. Soave says the former mayor had a lot to say about the things he was doing in the city.

Gurewitz says maybe that's not a good question. Soave agrees "yeah, that's not too good."

Soave still embarrassed about how much he paid for the basketball tickets.

Gurewitz pressing that the relationship he had with Kilpatrick included more than just friendship. Soave says Kilpatrick was a very likeable guy. "I liked the mayor." Soave says he wanted to keep him happy.

Gurewitz asks if because of the age difference Kwame respected his opinion. You'd have to ask him says Soave.

9:41AM US Attorney Michael Bullotta gets up to redirect. No cross from Ferguson lawyers.

Bullotta says "This will be over for you soon." Soave answers "I hope soon."

Bullotta going over memo from March 2002 from in-house attorney for Soave Susan Johnson.

Soave reads "Basically need to know what are the issues and what do we need to do to get the contracts through City Council."

Soave says he understands that people he needs to get through is Kilpatrick or purchasing.

Bullotta says you understood the contract was stopped somewhere. Yes that was the indication says Soave.

So you believed contract was being held? Yes says Soave that was the information I was getting.

Soave testified that he went to meeting with mayor by himself to ask what the hold up was.

Gurewitz objects. Judge overrules.

Soave says he doesn't remember the exact words but remembers Kwame saying he had the wrong sub-contractor.

Bullotta asks if Kwame appeared aware the contract was being held?

Defense objects.

Soave says Kwame didn't appear confused about the hold up. Soave says he told him he had wrong sub-contractor and that he needed Ferguson.

Soave says he knows that the contract was being held up. "He was the boss. It was in his hands."

Looking at the contract approval document. Bullotta points out signatures and says Kwame was boss. soave agrees.

Bullotta asks if he remembers another mayor having held up a contract. "No I did not."

Soave says he was very concerned about the Inland job. "It was a $50 million job."

Soave agrees there were many people concerned about their jobs on that contract. Soave agrees that he was concerned about his employees.

Bullotta asks about Charlie Williams being a minority front. Soave says he told Mike Rataj it was absolutely not true.

Bullotta asks about mentoring relationship if mentee usually has an established business. Soave says Charlie definitely had some skills.

Soave says that sometimes mentees have an established business and sometimes they don't.

Soave says that Williams had a lot of experience. He had run the DWSD twice.

Soave says he thought Williams "had a lot on the ball and I still do."

Williams went on to become Soave's partner at MPS. Williams is in charge of it. Soave says it is more than 100. "It's a nice company" says Soave.

Soave being asked about Bobby Ferguson's "you're only here because of me." Soave says at one point he did talk to Kilpatrick about Bobby when he asked if Bobby was still his guy and Kwame affirmed he was.

Soave says if the answer would have been different they probably would have taken action and worsened his work load. Soave says that ultimately they probably wouldn't have done any more work with him.

9:54AM Defense attorney Mike Rataj cross-examines for Bobby Ferguson.

Judge tells him she thinks this is last go round of questions.

Rataj says he wouldn't have asked any questions if Bullotta didn't. "I didn't have any control over him" says Soave

Rataj says he didn't know for sure that it was purchasing or the mayor holding up the contract. That's what I said says Soave.

Now looking at Johnson's March 2002 memo again. Rataj says if he knew if law department or finance had signed off on contract 1368. Soave says he does not know that.

On the approval document from June 2002. Signed off by law department at that point and not earlier.

On the memo it says that DWSD was telling Inland Waters to ask minority suppliers. That's what it says answers Soave.

Soave agrees he doesn't remember exactly what words were used in meeting with Kwame.

Rataj asks if Soave ever directly asked mayor at that April 2002 meeting if he was holding up contract 1368 and if so, why? "I never used those words, no" says Soave.

Rataj refers back to question from yesterday of it was usual in other cities for them to have preferred contractors. Soave agrees that it's normal.

Rataj says that at no point did Kwame says "Mr. soave if you do not use Bobby Ferguson you will not get any more work in Detroit." Soave says "No he did not use those words."

Soave saying about Williams not having employees or equipment, "In his case he was his company" says Soave about Williams.

Rataj says Williams did not have experience to get boots on the ground to get muddy on the ground. soave disagrees that he did not have any experience. "He ran DWSD."

Rataj says that's a different animal than going out in the field. Soave says that's your opinion. I thought he would be a good company to mentor and hopefully at the end it was going to be fruitful.

Rataj presses he didn't have any work experience to carry out provisions of 1368 for pipe rehabilitation. Ferguson says Rataj was the one who had the company to do the grunt work. Soave agrees that he was equipped to do that.

Rataj says Williams did not bring to the table what Ferguson could. Soave says he did not choose him.

Soave says Williams did have experience but not the equipment and the people.

10:07AM Soave see Gurewitz get up to cross-examine again so he shakes his head and goes "Oh-oh".

Gurewitz going back over meeting with Kwame and contract approval. Soave says he was told there was hold up in the mayor's office.

Soave says about mayor "maybe he had no control over anything. But I believed he did."

In April 2002, Gurewitz says that the mayor did not control the purchase department.

Bullotta objects. Judge sustains.

Gurewitz says he is done.

Judge thanks Soave. Soave says "Thank you folks" and he is gone.

10:11AM Next on the witness stand is Kathleen B. McCann. McCann was a VP at soave Enterprises. She ran contract 1368 and was the one who dealt directly with Bobby Ferguson and frequently complained about him to Soave. US Attorney Mark Chutkow questions McCann. We have a nice shot of McCann who looks composed but nervous in her blazer, green sweater and string of pearls. Bet she hoped never to have to be in the same room as Ferguson again. Sidebar is called. McCann waits patiently for questioning to begin. McCann says she currently works as CEO for United Road Services Inc. She says they move cars throughout the nation. Revenues of $300 million with a thousand employees. Joined United Road Services in January 2011. Before that she was a SVP with Soave Enterprises. Responsible there for beer distribution and was on the Board of Directors. Was responsible atone point for car dealerships and industrial services, including Inland Waters and MPS. 

McCann says she was a member of 5, including Mike Piesco, Mike Hollaback and Yale Levin. Worked with Soave Enterprises with 21 years. Before that was with Coopers and Lybrand as a CPA. McCann says that Inland Waters submitted bid for 1368 in 2001. McCann was executive liaison for Soave to Inland Waters. Witness says that there were 2 initial bids and Inland was low bidder on both. She was not typically responsible for putting together bids. Denis Ozust was primarily responsible for putting together bids. He was SVP at Inland. Witness says Insitu Form was a nationally known company that they had done work with for many years that they bid with. also bid with CJ Williams. Kathleen Levy at the time director DWSD put forward recommendation for contract approval. "Then it got stuck" says McCann. McCann says at time went on there was more urgency and they would ask when the contract would come. She says they had a lot of employees depending on revenue stream, equipment that had been invested in and employees would have been laid off without the contract. McCann says Inland chose Williams to be primary sub-contractor and there was a lot of excitement. He didn't have a lot of practical experience but he had been CEO of DWSD. There was a lot of potential for something of national scope. McCann says clearly someone who has skills in the public sector could be successful in private. They had not doubt he could be a successful leader. McCann says they trusted him and his judgment. McCann says they used Insitu Form for portion of contract involving specialized lining. McCann says that they knew eventually they would evolve operations so that the minority company established would become capable of doing the work. The expectation was that Williams would build up company, Inland would help him build crews and over time a company would be established to do it all. McCann says once contract got stuck it became clear there was a reason why. McCann says Soave met with the former mayor and was instructed to use Ferguson. McCann says it was envisioned that Williams would establish business in Detroit. McCann says the opportunity was significant, Williams had a great resume and had established credibility with his name. There were lots of contracts that required minority content. Would have been in a position to take advantage of these opportunities.

McCann says Williams was disappointed but they made a payment to him to ease the pain. McCann says they had continuing business with Williams. Soave was an investor in MPS Group, a minority business Enterprise. GM had come to them to invest and help mentor this company in the industrial space. Williams became an owner and is now CEO if MPS. Controlling owner with 52%. Before automotive meltdown, MPS made $55 million (up from an initial $6 million) according to witness. McCann says revenues now are more like $40 million. 

10:35AM Judge says this is a good point to take a 20 minute break.

10:41AM For someone who was desperate to be done with testifying, Tony Soave isn't rushing out of the courthouse building. He is sitting up front in the courtroom between his 2 lawyers listening to the testimony of his former employee Kathleen McCann.

Jurors seemed to love Soave. When Judge Edmunds told him he was done, he replied "You sure?" to laughter from the jurors. He nodded in acknowledgement to the jury as he got off the stand and several nodded back in return.

10:55AM Best part of the day bar none is the first floor snack shop during break. Ferguson's defense lawyer Rataj was holding court with a bunch of reporters expressing his displeasure at williams being painted as a viable contractor. "He had no equipment and no employees!" bellowed Rataj.

But better than that is Rataj telling us how he gets his agression out every morning by wrestling with his 70 pound bulldog. Awesome visual.

10:58AM Chutkow continues with McCann.

McCann says she started to have concerns with hold up in spring of 2002 within months of contract decision being made. McCann said she was assigned executives for industrial services portfolio for a few years. Doesn't remember any other contract being held up. Recalls 1368 being held up by the mayor's office.

Susan Van Dusen, lawyer for Fergusonj, objects about hearsay when Chutkow asks what happened in mayor's meeting with Soave. Sidebar disband.

McCann says "essential message was Williams was out and Ferguson was in" from Soave meeting with Mayor.

McCann says folks at Inland said they were familiar with Ferguson Enterprises.

McCann says Williams was very disappointed about getting ousted.

McCann says later in the spring 2002 she met Ferguson with Yale Levin, anothe EVP with Soave. they went to his offices on wyoming. It was an initial introduction. Ferguson told them about his family history and types of work he had done. Soave execs talked about the scope of their company and mentoring programs.

McCann says Ferguson clearly had a company with yellow iron. He made clear he had contracting expertise. One of the focuses was how much money would make on the contract. He seemed to want 3%. Not clear what he met. Levin thought he meant 3% of profits.

Defense objects to hearsay. Judge overrules.

McCann says the 3% was confusing to her. It was unusual. there was not a lot of "diving into detail in this conversation."

McCann says most contractors focus on top line and efforts they would provide. Not her recollection that was what Ferguson did.

3% of $50 million contract is $1.5 million.

McCann says there were a number of different ways that Ferguson's companies could contribute to contract. It took them a long time to get to how the contract would be executed. There were lots of discussions between Inland and Ferguson about how 20% minority target would be met.

McCann describes interactions with Ferguson as "difficult."

McCann did not understand the 3%. It was a nonsensical focus says the witness. Ultimately there was work that they could have Ferguson do.

McCann says normally when sub-contractor could do $10 million of work, they will be aggressive about getting it done. Not that way with Ferguson. McCann perceived Ferguson as difficult, "substance over form." It happened repeatedly that the actual movement of getting contract to actual place would take a long time.

McCann says "we were essentially in a forced marriage". She says they did their best to get the contractual arrangements to satisfy their arrangement with the city of Detroit.

McCann says the forced marriage was with Ferguson who had been selected for them by the former mayor.

Chutkow asks for sidebar for upcoming topic.

Kwame is sitting back in his navy velvet jacket and red and white plaid tie. Very Christmasy. Bobby is in a camel colored suit.

11:14AM Chutkow asking about Mackinaw policy conference in June 2002. McCann went to conference as did Ferguson. They spoke about the breakdown of the contract. It was general conversation about what it would be- they identified percentage of dig up work for Ferguson to do. The target that had originally been allocated to Williams.

Looking at memo from Inland to DWSD on December 4th 2001. Lists IWPC (Inland Waters) 35% of contract, Insitu Form for 30%, CJ Williams for 20%, Superior Engineering 5%. Willie McCormick, L. D'Agostini and Superior Contraction listed for a shared 10% of the contract.

At the policy conference on Mackinaw, she ran into people from the mayor's office including Derrick Miller. Ran into him at an event at one of the island's hotels. The mayor was there as well as was Ferguson. Miller asked how negotiations with Ferguson were going. Miller brought it up. McCann says it made her uncomfortable. It was a very public setting. They were concerned that Williams had been replaced and that competitors may use this to get contract rebid. Conversation did not seem appropriate to her. Mccann says it was the first time she experienced this type of conversation.

McCann says it was well know that Inland bid was 15 to 40% less than next bidder. Inland was very nervous about losing this contract to other bidders based on the delay.

McCann says she took notes about conference. Once meeting was done, she called Soave and Levin and voiced her concerns from conference.

McCann says their pricing info on the bid publicly published. If the contract were rebid, Inland would have been at a distinct disadvantage. McCann says it's not uncommon from municipalities to ask people to submit sealed bids. They are then ranked.

McCann says that her concern was that the contract was not yet done and a mayoral cabinet member asking about it let her know again that the negotiations had to be done before conference concluded.

McCann says mayor is very friendly. Saw him at the conference and he told her "Bobby is a good guy." She said they were working on it meaning working to get Bobby his $10 million worth of work.

Witness says she met with Insitu Form to see how they could fit Ferguson in the project. McCann says she met with regional executives at Insitu form about Ferguson. The Inland folks worked it out with Insitu Form- the ultimate goal was to get Ferguson Enterprises work and then revenues for that work.

Witness says she talked to Ferguson about work he had to do to get paid. "Actions speak louder than words," says McCann. They wondered how serious he was about actually doing work.

McCann says they had a concern they would be unable to meet minority requirement as promised to city of Detroit. they still did not have meaningful work from FEI because basic contracts had not been signed.

Most interactions were between Ozust from Inland and Ferguson. McCann says that sometimes she inserted herself.

McCann says there was more difficulty with Ferguson than with other contractors. She says many of the normal clauses were hard to get over with Ferguson. Ferguson resisted insurance clauses. Finally, in early 2003, a contract with Ferguson was signed. McCann says problem was that they couldn't give him revenue without signed contracts.

11:34AM McCann says they offered to mentor him but Ferguson was not interested in being mentored. Williams, however, had been enthusiastic to come into opportunity to work with Soave companies. To learn the business from the other side was appealing to him.

On Ferguson's work performance, McCann says there were a number of challenges. One incident they received something from the city of Detroit stating not to give the sub-contractor more work until he got caught up. Also some of the billings by Ferguson were faulty.

Looking at an Avoid Verbal Order from the city of Detroit on August 19th 2004 to Dennis Oszust of Inland. Advises Inland to have Ferguson work stopped until issues for restoration are resolved.

Document has a deficiency list of at least 7 different locations.

McCann says Ferguson was upset that he was unfairly blamed for the activity. McCann says not uncommon for people to have complaints. "He felt he was being a scapegoat."

Witness says Ferguson took credit for Inland contract 1368 despite not being on the bid. McCann says his theme was disrespected and did not get the credit he deserved. That he could have picked anyone and he picked Inland. it was a recurring theme.

Ferguson told them that at the sinkhole at 15 mile in Sterling Heights Inland was only there because of him.

McCann says she took notes of their conversation. "We had a sense that some day we would be telling the story and we had to have documentation."

"We knew the risk of losing work was hanging over our heads," says McCann.

McCann was wondering if they were being crippled intentionally because they were not working on Ferguson's threat. "There was a constant threat."

McCann says that her company was instructed make sure Ferguson works for anything payment. Inland employees told "To stay within the handrails" and not pay for no show work.

McCann says she stayed closer to this contract than she would have otherwise. this particular circumstance rose to another level so she was more meticulous about note taking.

Witness says Soave met with mayor because he was concerned about stop work order. "He was worried there was another message there." Soave told McCann after the meeting that Ferguson was still their sub-contractor.

McCann says she knows some Insitu form employees talked to the mayor about Ferguson. One such employee was a Paul Jorgensen. Jorgense indicated to McCann that the mayor told him that "Bobby was the guy."

Ferguson wanted a portion of profits from 15 mile of sinkhole- 20% of revenues and associated profit. McCann says it was an emergency, a huge chasm in the ground, and specialized crews were brought in. Ferguson ultimately disappointed in the revenues that came in for the job- the whole job was worth $50 million.

Chutkow submits some documents into evidence.

11:51AM Looking at email from Dennis Oszust on September 17th 2005 to McCann. There is a hold up to an amendment to the sinkhole project because it's waiting for executive approval. Oszust says he will settle outstanding issues with Bobby. McCann believes the issues had to do with how much profit Ferguson was going to earn on that job.

Email from October 11th 2005 from Oszust to McCann. About amendment #4 being held up until Ferguson is satisfied. An Insitu executive had talked to Kwame about the hold up.

Ferguson called McCann and Oszust for a meeting after Kwame's re-election. Ferguson told them that he was dissatisfied with historical relationship. He was not going to go forward in the same circumstances. He had a litany of complaints including being disrespected, not being given credit for getting Inland work, having to sign a note for cash flow, upset by conversations of Levin and Soave with administration about Ferguson. McCann says it was a disturbing meeting for her. The fact that "Inland still had a sword hanging over their head" and Ferguson acting like he had full power over Inland getting work.

Ferguson was still upset about getting so little on 15 mile sinkhole. Inland had talked to Mercado about Ferguson on the sinkhole. And Mercado said don't worry about Bobby just do the work well. Inland reported back to Ferguson who told them it was just a smokescreen and "You act like Victor has ever made a single decision there, ever."

McCann agrees that she was concerned about the contracts and that is why she kept relationship.

12:01PM Judge calls for a 5 minute break.

12:15PM Susan Van Dusen for Bobby Ferguson cross-examines. It's been some time since we heard from Van Dusen.

Van Dusen asks if McCann was a CPA, an auditor for City Management and eventually rose to become part of Soave's executive team. Correct says McCann.

McCann agrees that she oversaw Industrial Services portfolio at Soave that included Inland.

McCann says that what makes Soave work so well is that there is a group of individuals with different expertise. General support for all the businesses in the portfolio.

Van Dusen congratulates McCann on rising through the corporate hierarchy. "I've been fortunate" says McCann.

Van Dusen asks if she was an overseer on the contract. McCann agrees that she was.

McCann also agrees that she had other duties at Soave.

Van Dusen says contract didn't take up majority of your time? McCann agrees.

Video angle just changed and we have the best shot yet of the courtroom as it's pulled out to reveal more of the witness stand.

Van Dusen asking about Dennis Oszust who was a SVP at Inland. McCann said he had a high level of responsibility on the contract.

Van Dusen says Oszust would bring you up to date on certain things? Correct says McCann.

McCann also agrees that Oszust gave her the majority of the "nitty gritty" on the contract.

Van Dusen making point that most of info on Ferguson interactions would come from Oszust and another Inland executive.

Van Dusen asking about McCann's interview in May 2010 by FBI special agent Bob Beeckman. Van Dusen says that McCann provided an unusually large number of documents related to 1368. McCann agrees that she provided the documents.

Van Dusen publishes a document from Kathleen Leavey of the DWSD from December 19th 2001. Says that the Board of Water Commissioners has authorized her to enter into contract with Inland Waters.

McCann says the document is from early in the process.

Van Dusen points to Project Management portion of document. Says it is "contnigent upon city council approval."

McCann agrees that city council ultimately needs to approve all these contracts.

12:28PM Van Dusen says so it was incorrect when you said that the mayor was responsible for the contract.

Chutkow objects and judge sustains.

Van Dusen says it's probably reasonable to say that your memory of events in 2010 with Beeckman about events 8 years earlier might be better today. McCann says she has the same documents so it may be similar.

Van Dusen asks if you wanted to be as thorough as possible with Beeckman. McCann says "I wanted to be as honest as possible."

Van Dusen hands document to McCann about interview with Beeckman. In the interview, McCann told the FBI that the mayor had to approve the contract.

Judge calls for a sidebar.

McCann agrees that she reviewed her statement to FBI recently.

McCann says she doesn't know if "nits and lice" were conveyed to the government. Not sure what she means by that but it sounds disgusting.

Van Dusen asks if she is familiar of fact that in February 2002 Oszust informed McCann that he had provided DWSD with some documents. McCann looks perplexed so Van Dusen hands the document to her.

Van Dusen says that in February Oszust was furnishing required documents to DWSD. McCann agrees.

Van Dusen says so it looks like approval process was in place? McCann says that she sees that he did it on that day.

Van Dusen says Inland even submitted invoice for payment in March 2002. McCann says she wasn't aware of that. She doesn't have any detail on it.

12:45PM For the billionth time, we are looking at signature page on the back of Inland's contract from June 26th 2002. Van Dusen states that the approval process culminated with this approval by city council. Van Dusen says this keeps with first document from December 2001 that stated city council approval.

So mayor has no authority on approval asks Van Dusen? McCann says it was our understanding that the contract had to go through the mayor before it got to city council.

Van Dusen says contract has to go through budget office? McCann says she is not intimate with every step of the process.

Had to go to law department? McCann says "sounds reasonable."

Van Dusen says not a single one of those departments is part of mayor's office? McCann says that is my understanding but i lack intimate familiarity.

McCann says there were people on her team did have familiarity and that after Soave met with team and things got moving it seemed to prove their conclusion.

McCann says that the Inland folks who have knowledge of the process. McCann mentions Dennis Oszust.

So its Dennis Oszust who told you that the contract was being held up? McCann says "it was obvious to everyone that we didn't have a contract. So we knew it wasn't done. And we didn't know why not so we concluded it was in the mayor's office."

McCann says ultimately decision was made to check with the mayor. She says there was enough concern that the contract wasn't let yet. "It seemed like a long process."

So Dennis was anxious? "Everyone was anxious," says McCann.

McCann says there was concern that the current contract was almost up and that they didn't have 1368 yet.

So Van Dusen says Oszust had to come up with reason for bosses why contract wasn't done?

Van Dusen basically saying that Oszust was getting pressure from higher ups as to why the contract wasn't happeneing so he just pointed at the mayor's office.

Van Dusen says she is moving on to a whole new chapter so this might be a good place to stop. Judge agrees and dismisses jury.

12:57AM Flurry of activity at defense table as Van Dusen returns. Bernard Kilpatrick seems somewhat agitated. He and Ferguson exchange some words. Kwame looks like he is talking to Van Dusen about that cross-examination.

Court resumes Monday morning at 9AM.

About the author

Alexandra Harland is a Princeton undergrad and has a masters degree in International affairs with Columbia. A Montreal native, she worked with the Daily Telegraph newspaper for a few years before transitioning to TV, when she worked at ABC News with Peter Jennings. Alexandra has also worked in newsrooms in both Detroit and Boston. 

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