Dirtiest Trials of the Twentieth Century
692
Transcription
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
694
1 M O R N I N G S E S S I O N
2
3 (The following takes place in the absence of the
4 jury.)
5 THE COURT: Good morning.
6 MR. TRABULUS: Good morning.
7 THE CLERK: Jury entering.
8 (Whereupon, the jury at this time entered the
9 courtroom.)
10 THE COURT: Good morning, members of the jury.
11 Please be seated.
12 Permit me to compliment
you on getting here ahead
13 of time. Now, that's what I call responsibility and
14 efficiency.
15 Thanks very much.
16 You may proceed, Mr. White.
17 MS. SCOTT: The government calls Dr. Bradley
18 Fischman.
19 THE CLERK: Please raise your right hand.
20
21 B R A D L E Y F I S C H M A N ,
22 called as a witness, having been first
23 duly sworn, was examined and testified
24 as follows:
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
695
1 THE CLERK: Please state your name and spell your
2 last name slowly for the record.
3 THE WITNESS: Bradley Fischman.
4 F I S C H M A N.
5
6 DIRECT EXAMINATION
7 BY MS. SCOTT:
8 Q Good morning, Dr. Fischman. Can you tell us what you
9 do for a living?
10 A Dentist.
11 Q Where do you practice?
12 A Great Neck,
New York.
13 Q How long have you been a dentist?
14 A 27 years.
15 Q Do you know Bruce Gordon?
16 A Yes.
17 Q Can you see him in the courtroom today?
18 A Yes.
19 Q Please state who he is by indicating what he is
20 wearing and where he is sitting?
21 MR. TRABULUS: Identification conceded, your
22 Honor.
23 THE COURT: Very well.
24 Q How do you know Bruce Gordon?
25 A He was a patient.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
696
Fischman-direct/Scott
1 Q I am showing you Government's Exhibit 622, which
2 consists of two checks.
3 THE COURT: Is that for identification?
4 MS. SCOTT: That's for identification.
5 Q Do you recognize those?
6 A No. They are made out to me. I never handle the
7 checks in my office.
8 Q Does it appear that they are handled by the person
9
who regularly does handle the checks?
10 A Yes, they have our stamp on the back, made out to us
11 and they are appropriate for the work done.
12 Q What are those amounts?
13 A $1,500 and $2,500.
14 MS. SCOTT: I offer Government's Exhibit 622,
15 your Honor.
16 THE COURT: Any objection?
17 MR. TRABULUS: No objection.
18 THE COURT: Government's Exhibit 622 in
19 evidence.
20 (Government's Exhibit 622 received in evidence.)
21 Q What are the dates indicated on those two checks?
22 A 4/14/92 and 12/10/92.
23 Q What is the name of the person or entity that made
24 out the checks to you?
25 A Who's Who Worldwide Registry, Inc.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
697
Fischman-direct/Scott
1 Q And that's on both checks?
2 A Both checks.
3 MS. SCOTT: Thank you. No further questions.
4
THE COURT: Anything?
5 MR. TRABULUS: Very briefly.
6
7 CROSS-EXAMINATION
8 BY MR. TRABULUS:
9 Q Good morning, Dr. Fischman.
10 You were paid for performing dental services on
11 Mr. Gordon; is that correct?
12 A Yes.
13 Q And you believe those are the two checks used to pay
14 that; is that correct?
15 A Yes.
16 Q As you sit here today, do you know whether or not the
17 corporation itself took a tax deduction for that?
18 A I have no knowledge.
19 Q Or do you know whether or not it is simply regarded
20 as a loan to Mr. Gordon?
21 A No knowledge.
22 MR. TRABULUS: Thank you.
23 MS. SCOTT: Nothing further.
24 THE COURT: You may step down, Doctor.
25 Please call your next witness.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
698
Fischman-cross/Trabulus
1 (Whereupon, at this time the witness left the
2 witness stand.)
3 MR. WHITE: Your Honor, the government calls
4 Joyce Grossman.
5 THE COURT: Do you want to raise your right
6 hand.
7
8 J O Y C E G R O S S M A N ,
9 called as a witness, having been first
10 duly sworn, was examined and testified
11 as follows:
12
13 THE COURT: Please be seated.
14 State your full name and spell your last name.
15 THE WITNESS: Joyce Grossman, G R O S S M A N.
16 THE COURT: You are the only witness I ever
17 permitted to wear a hat, Ms. Grossman in a court building,
18 do you know that?
19 THE WITNESS: Really?
20 THE COURT: You have made history.
21 I would not ask you to remove it. If you were a
22 man I would certainly do that. And it is not because of
23 any gender bias at all.
24 THE WITNESS: Thank you.
25 THE COURT: You may proceed.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
699
1 MR. WHITE: Thank you, your Honor.
2
3 DIRECT EXAMINATION
4 BY MR. WHITE:
5 Q Ms. Grossman, can you tell us how old you are?
6 A 71.
7 Q Tell us where you live?
8 A In California, Los Angeles.
9 Q How long have you lived there?
10 A About 46 years.
11 Q Do you work?
12 A Yes.
13 Q What do you do?
14 A I am an interior decorator.
15 Q And does your interior decorating business have a
16 name?
17 A It is my name, Joyce Grossman interiors.
18 THE COURT: You have to pull the microphone a
19 little closer and keep your voice up, Mr. Grossman.
20 THE WITNESS: Yes, I will.
21 Q Are you married?
22 A Yes, I am.
23 Q Is your husband Dr. Grossman who testified here
24 yesterday?
25 A Yes, he is.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
700
J. Grossman-direct/White
1 Q Now, do you know a man named Bruce Gordon?
2 A Yes, I do.
3 Q How do you know him?
4 A He is my brother.
5 Q Now, are you testifying here today pursuant to a
6 court order granting you immunity?
7 A Yes, I am.
8 Q Tell us your understanding of that court order, and
9 what it means?
10 A That anything I say today will not be held against
11 me.
12 Q Are you familiar with a company known as Who's Who
13 Worldwide Registry?
14 A Yes, I am.
15 Q Did you and your husband invest in that company?
16 A Yes, we did.
17 Q Now, prior to the time that you invested, did you or
18 your husband have any discussions regarding your
19 investments with Mr. Gordon?
20 A Yes, we did.
21 Q And who handled that, those discussions with
22 Mr. Gordon?
23 A Primarily my husband.
24 Q How much did you and your husband invest in the
25 company?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
701
J. Grossman-direct/White
1 A $125,000.
2 Q Can you tell us approximately when you made that
3 investment?
4 A In the summertime of 1990.
5 Q Can you tell us in general terms how that investment
6 was structured?
7 A Well, the funds were to come from our family trust
8 and my husband's retirement plan.
9 Q And the $125,000, was that to be repaid to you?
10 A Yes.
11 Q Were you to have any ownership interest in the
12 company?
13 A 25 percent.
14 Q Who owned the remaining 75 percent?
15 A Bruce Gordon.
16 Q Now, from the time you invested right up until today,
17 has your percentage ownership of the business ever been
18 greater than 25 percent?
19 A No, it hasn't.
20 Q And when you invested, what was your understanding of
21 what role you and your husband were to have in the
22 management or financial affairs of the company?
23 A No involvement, except as a silent partner.
24 Q Now, were you ever consulted in advance regarding
25 business decisions of the company?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
702
J. Grossman-direct/White
1 A No, I was not.
2 Q Mrs. Grossman, let me show you
3 Government's Exhibit 582 for Identification; if you can
4 look that over.
5 (Handed to the witness.)
6 Q Now, do you see a signature on that document?
7 A Yes, I do.
8 Q And does that appear to be your signature?
9 A Yes, it is.
10 MR. WHITE: Your Honor, may I just have one
11 moment to speak with Mr. Trabulus?
1
2 THE COURT: Sure.
13 (Mr. White confers with Mr. Trabulus.)
14 MR. WHITE: Your Honor, the government would
15 offer Exhibit 582 as a business record of Who's Who
16 Worldwide.
17 MR. TRABULUS: No objection.
18 THE COURT: Government's Exhibit 582 in
19 evidence.
20 (Government's Exhibit 582 received in evidence.)
21 MR. JENKS: Mr. White, it is offered only against
22 Mr. Gordon?
23 MR. WHITE: Correct.
24 MR. JENKS: And Mr. Reffsin.
25 MR. WALLENSTEIN: I don't think it is offered
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
703
J. Grossman-direct/White
1 against Mr. Reffsin.
2 THE COURT: Who is it offered against,
3 Mr. White?
4 MR. TRABULUS: Your Honor, I would offer it in
5 favor of Mr. Gordon.
6 MR. WHITE: Mr. Gordon.
7 THE COURT: Okay.
8 Q Mrs. Grossman, let me show you Exhib
it 582-A. Is
9 that simply an enlargement of 582?
10 A Yes.
11 MR. WHITE: Your Honor, the government offers
12 582-A.
13 THE COURT: Any objection?
14 MR. TRABULUS: No objection.
15 THE COURT: Government's Exhibit 582-A in
16 evidence.
17 (Government's Exhibit 582-A received in
18 evidence.)
19 Q Now, Mrs. Grossman, do you recall specifically ever
20 signing that letter, Exhibit 582?
21 A No, I don't.
22 THE COURT: 582 is a letter?
23 MR. WHITE: Yes.
24 THE COURT: What date?
25 MR. WHITE: It is dated January 10th, 1990.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
704
J. Grossman-direct/White
1 Q Now, Mrs. Grossman, did you prepare that letter?
2 A No, I did not.
3 Q Was it typical that you or your husband would be sent
4 Who's Who Worldwide documents for your signature?
5 A Yes. But I don't recall anything as early as this.
6 Q Now, if you could read along on the copy in front of
7 you, while I read the first paragraph aloud.
8 It is dated January 10th, 1990. The addressee is
9 Bruce Gordon, 99 Seaview Boulevard, Port Washington, New
10 York, 11050.
11 Dear Bruce:
12 We have now created a new corporation in New York
13 State known as Who's Who Worldwide Registry, Inc., parens,
14 called the Corporation, close parens. I have been issued
15 and am holding 75 percent of the shares of the
16 Corporation.
17 Do you see that, Mrs. Grossman?
18 A Yes, I do.
19 Q Now, did you or your husband have anything to do with
20 the incorporation of Who's Who Worldwide in New York
21 State?
22 A No, we did not.
23 Q Did you ever personally own 75 percent of the shares
24 of the corporation?
25 A No, I did not.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
705
J. Grossman-direct/White
1 Q Did you or your husband or any of your family
2 entities ever own 75 percent of the shares of the company?
3 A No, we did not.
4 Q Now, if you could follow along while I read the third
5 paragraph.
6 As majority shareholder, and in view of my great
7 geographic distance from the corporation's headquarters in
8 New York, I grant you full authority to operate and manage
9 the corporation's affairs, and to unilaterally make all
10 relevant business decisions. This grant of authority
11 includes the right to vote my shares as you see fit. In
12 addition, if you should find it desirable in advancing the
13 corporation's interests, I authorize you to state to third
14 parties that you are the owner of my shares in the
15 corporation.
16 Affectionately, Joyce Grossman.
17 Do you see that, Mrs. Grossman?
18 A Yes, I do.
19 Q To your knowledge, were you ever the majority
20 shareholder?
21 A No, I was not.
22 Q And did you ever authorize your brother, Mr. Gordon,
23 to state to third parties that he was the owner of your
24 shares?
25 A No, I did not.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
706
J. Grossman-direct/White
1 Q Did you ever grant voting control of the shares that
2 you and your husband, and your family trust owned to
3 Mr. Gordon?
4 A No, I did not.
5 Q And the letters dated January 10th, 1990, to the best
6 of your recollection, have you or your husband invested in
7 the company in January of 1990?
8 A No. It wasn't until the summer of that year.
9 Q Now, Mrs. Grossman, let me show you Exhibits 585 and
10 586, which are already in evidence.
11 (Handed to the witness.)
12 Q Now, Mrs. Grossman, those are Who's Who Worldwide
13 stock certificates; is that correct?
14 A Yes.
15 Q And if you look at Exhibit 585, it indicates that on
16 January 23rd, 1990 these certificates -- this certificate
17 was issued to you; is that correct?
18 A That's what it says.
19 Q Were those issued to you in January of 1990?
20 A No, they were not.
21 Q Did you ever own 75 percent of the company?
22 A No, I did not.
23 Q When was the first time that you saw these stock
24 certificates?
25 A The first time I remember, I believe it was in your
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
707
J. Grossman-direct/White
1 office.
2 Q And do you remember approximately what year that was?
3 A Last year.
4 Q 1997?
5 A Yes.
6 Q Mrs. Grossman, let me draw your attention to December
7 of 1992. Did you or your husband receive any compensation
8 from Who's Who Worldwide around that time?
9 A Yes, we did.
10 Q Tell us what you received?
11 A Two checks from Who's Who, amounting to $400,000,
12 less taxes.
13 Q And tell us what your understanding was of what that
14 payment was for.
15 MR. TRABULUS: Objection, your Honor,
16 understanding.
17 THE COURT: What does understanding mean? Was
18 she told what the payment was for? Did the checks have on
19 it, or the letter accompanying it have any information?
20 MR. WHITE: I will ask her.
21 Q Did you have any discussions with Mr. Gordon
22 regarding what that payment was for?
23 A No, I did not.
24 Q Had you previously performed any work for Mr. Gordon
25 for Who's Who Worldwide?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
708
J. Grossman-direct/White
1 A Yes, I did.
2 Q Tell us what work you had performed?
3 A Decorating services.
4 Q What had you decorated?
5 A His office in Lake Success, and later on his
6 condominium, and after that the penthouse in Manhattan.
7 Q Now, did you ever have any discussions with
8 Mr. Gordon regarding his compensation in Who's Who
9 Worldwide?
10 A Not any discussion. I didn't want to make any money
11 off my brother. I told him that the first project, which
12 was at Lake Success, that I did alone, with my husband
13 helping me somewhat, that I wouldn't charge him anything.
14 He would pay cost price for everything. And that's
15 exactly what happened.
16 In fact, I arranged for him to pay the sources
17 directly.
18 MR. JENKS: Judge, I am going to object as the
19 response not being responsive to the question.
20 THE COURT: Let me hear the question,
21 Mr. Reporter.
22 MR. WHITE: Your Honor, I agree it is not
23 responsive. I believe the witness misunderstood the
24 question.
25 THE COURT: Strike out the answer as not being
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
709
J. Grossman-direct/White
1 responsive.
2 Q Ms. Grossman, we will focus on the decorating in a
3 moment. Let me ask you about another topic.
4 Did you have any discussions with your brother
5 regarding what compensation he was receiving from Who's
6 Who Worldwide?
7 A Absolutely not.
8 Q Did you ever discuss with anyone at Who's Who
9 Worldwide Mr. Gordon's compensation?
10 A No, I did not.
11 Q Did you ever discuss any written compensation
12 agreement with any Who's Who employee?
13 A No.
14 Q Did you ever
verify for any employee that there was a
15 written agreement?
16 A No.
17 Q Compensation agreement, no?
18 A No.
19 Q Now, let me direct your attention to the summer of
20 1993.
21 Is it correct that Mr. Gordon's son passed away
22 at that time?
23 A Yes, it is.
24 Q Did you give or loan Mr. Gordon any money in
25 connection with his son's funeral expenses?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
710
J. Grossman-direct/White
1 A No, I did not.
2 Q Let me show you Government's Exhibit 425, and its
3 attachments, which are already in evidence.
4 (Handed to the witness.)
5 MR. WHITE: Your Honor, that is one of the
6 documents which was previously passed out to the jurors.
7 Q Now, Mrs. Grossman, if you can turn to the second
8 page of that document, which is 425-A. And that's a
9 pro
missory note; is that correct?
10 A That's what it looks like.
11 Q It is dated July 25th, 1993; is that right?
12 A Yes.
13 Q The amount of the loan reflected is $15,000?
14 A Yes.
15 Q Did you ever make the loan to Mr. Gordon that is
16 reflected on this note?
17 A No, I did not.
18 Q Now, aside from when you met with your own attorney
19 or met with the government in connection with this case,
20 have you ever seen that document before?
21 A No.
22 Q You can put that away now.
23 Let me again focus your attention on late 1992.
24 Did you have any discussions at that time with
25 Mr. Gordon regarding his purchasing a home?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
711
J. Grossman-direct/White
1 A Yes.
2 Q Tell us what your discussions were?
3 A He told me that he was looking for a condominium to
4 purchase, and asked if I would be interested in helping
5 him decorate it.
6 Q Did you have any role in decorating a condominium?
7 A Yes, I did.
8 Q Is that the one at Hummingbird Road in Manhasset?
9 A Yes, it is.
10 Q Can you tell us what work you performed?
11 A We did the floor plans, color selection, furniture
12 selection, as well as household items, as well as dishes,
13 linens, etcetera.
14 Q Can you tell us how it was that you were paid?
15 A I invoiced him at the manufacturer's cost, plus ten
16 percent.
17 Q What was the ten percent for?
18 A For my partner's salary, and our business expenses
19 pursuant to the project.
20 Q And the actual suppliers of the furniture and other
21 merchandise, who actually paid them?
22 A We did.
23 Q So, you were paid by Who's Who Worldwide and you paid
24 them?
2
5 A That's correct.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
712
J. Grossman-direct/White
1 Q Now, Mrs. Grossman, let me show you Exhibits 600
2 through 609 for Identification.
3 (Handed to the witness.)
4 Q Can you tell us what those are?
5 A They are progress payments.
6 Q To Joyce Grossman Interiors?
7 A Yes.
8 Q Was that on your work on the Hummingbird condominium?
9 A Yes.
10 MR. WHITE: The government offers 600 through
11 609.
12 MR. TRABULUS: May I have a brief voir dire, your
13 Honor?
14 THE COURT: Yes.
15 MR. TRABULUS: Thank you.
16
17 VOIR DIRE EXAMINATION
18 BY MR. TRABULUS:
19 Q Mrs. Grossman, I believe you were asked a question by
20 Mr. White as to whether or not you were paid, your company
21 was paid by Who's Who Worldwide?
22 A That's correct.
23 Q Is that correct?
24 Now, these checks which were just shown to you
25 and which are in front of you, were not checks from Who's
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
713
J. Grossman-direct/White
1 Who Worldwide, are they?
2 A Publishing Ventures.
3 Q And these are the checks by which you were paid; is
4 that correct?
5 A Yes.
6 MR. TRABULUS: Thank you, your Honor. No
7 objection.
8 THE COURT: Government's Exhibit 600 through 609,
9 is it?
10 MR. WHITE: Yes, your Honor.
11 THE COURT: In evidence.
12 (Government's Exhibits 600 through 609 received
13 in evidence.)
14
15 DIRECT EXAMINATION (cont'd)
16 BY MR. WHITE:
17 Q New, Mrs. Grossman, from reviewing those checks, can
18 you give us an approximate figure how much you were paid
19 on the decorating services at the condominium?
20 A My fee or the merchandise?
21 Q I am sorry, the total of those checks.
22 A It is about 200,000.
23 Q Mrs. Grossman, let me show you Exhibit 610, which is
24 already in evidence.
25 (Handed to the witness.)
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
714
J. Grossman-direct/White
1 Q Now, Mrs. Grossman, have you ever seen that document
2 before?
3 A No, I haven't.
4 Q Now, if you can turn in there to the page that
5 begins, list of equity security holders, which is the
6 lower right-hand corner of the enlargement, which is
7 610-B.
8 Now, if you look on that page, it indicates that
9 you are the 75 percent shareholder of Who's Who Worldwide
10 Registry and that your husband is a 25 percent
11 shareholder.
12 Is that information accurate?
13 A No, it's not.
14 Q If you can turn to that page, which is the upper
15 right-hand corner of Exhibit 610-B.
16 Again, it indicates there that you are the 75
17 percent shareholder and your husband is a 25 percent
18 shareholder; is that accurate?
19 A No, it's not.
20 Q Now, did you ever have a discussion with Mr. Gordon
21 regarding his statements about your ownership interest in
22 the company?
23 A Only at the very beginning, when he suggested that
24 for our investment he would receive 15 percent interest.
25 And I protested and said that's ridiculous. We weren't
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
715
J. Grossman-direct/White
1 going to be doing anything. I didn't want anything. And
2 he said, no, you would have 25 percent.
3 Q Now, did there come a time that Mister -- you learned
4 that Mr. Gordon said that you owned more than 25 percent?
5 A Only when the law cases, the legal cases involved.
6 And not before that.
7 Q And after you learned that did you have a discussion
8 with Mr. Gordon about what he had said?
9 A Yes.
10 Q Tell us when this took place approximately?
11 A Last year.
12 Q 1997?
13 A Yes.
14 Q And where was this conversation? Where did this
15 conversation take place?
16 A In his present home.
17 Q Tell us what was said?
18 A I asked him how in good conscience he could say I
19 owned 75 percent of his company?
20 And he answered, well, don't you?
21 And I said, what are you saying?
22 And he said, I have bad advice.
23 MR. WHITE: Your Honor, I have no further
24 questions.
25 THE COURT: Cross-examination.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
716
J. Grossman-direct/White
1 MR. TRABULUS: Thank you.
2 MR. WHITE: Do you want to leave that there or
3 will you not need this?
4 MR. TRABULUS: You can take it away.
5 THE COURT: Do you want to remove the lectern
6 also, unless you need it.
7 Do you want to use it?
8 MR. TRABULUS: The easel? No. It is not
9 necessary. Actually the blackboard.
10 I will take it.
11
12 CROSS-EXAMINATION
13 BY MR. TRABULUS:
14 Q Good morning, Mrs. Grossman. I should have
15 introduced myself before. But we did speak very briefly
16 yesterday during the break; is that correct?
17 A Yes.
18 Q I just told you that I was Mr. Grossman's lawyer; is
19 that correct -- Mr. Gordon's lawyer, excuse me.
20 That's the last time we spoke?
21 A Yes.
22 Q The last answer you gave where you said you had a
23 conversation with Mr. Gordon, and he said that I had bad
24 advice, it was a little ambiguous as I understood it, and
25 I wish you would clarify it. When he said "I" did you
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
717
J. Grossman-cross/Trabulus
1 understand him to be referring to himself, or was he
2 referring to you?
3 A I don't understand why you don't understand what he
4 said. I said he said I had bad advice.
5 Q I meaning you or I meaning himself? Are you putting
6 it in quotes?
7 A Quotes.
8 Q So you understood him to say that he had bad advice
9 as opposed to you having bad advice?
10 A That's correct.
11 Q And my question didn't offend you, did it?
12 A I thought it was very explicit, my answer.
13 Q Okay.
14 Now, you are angry at your brother, are you not?
15 A No, I am angry at you for not understanding.
16 Q I hope you understand when I ask you questions, I am
17 trying to make things clear for the jury. I may make a
18 mistake. If something comes to me and I don't understand
19 it, it may be my limitations, but I want to be sure the
20 jury has an understanding as well. I will try to clarify
21 things. Can you accept that?
22 A Of course.
23 Q All right. That's the way we will proceed.
24 Now, Ms. Grossman -- Mrs. Grossman, excuse me.
25 You said this was your signature; is that correct?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
718
J. Grossman-cross/Trabulus
1 A Yes, it is.
2 Q Now --
3 THE COURT: This is what?
4 MR. TRABULUS: This is Exhibit 582-A. And I will
5 be referring to that rather than the 582, so everyone can
6 see what we are talking about.
7 Q Now, do you have any recollection at all as to when
8 you signed it?
9 A No.
10 Q Now, when you signed it, there was printing on it,
11 the words were on it; is that correct?
12 A I have no recollection of signing that.
13 Q Well, do you ever have any recollection of being sent
14 a blank piece of eight and a half by 11 paper with an
15 arrow telling you to put your signature at exactly a
16 particular place, and then to turn it over to Who's Who
17 Worldwide? Did anything like that ever happen?
18 A I don't recall.
19 Q Do you remember that? Wouldn't that be a little odd?
20 A At that particular time there was no reason for me to
21 try to remember dates or items, because I didn't know we
22 were going to be in these circumstances.
23 Q I think we can agree, can we not, that when this was
24 signed, it was after January 10th, 1990? We can agree to
25 that?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
719
J. Grossman-cross/Trabulus
1 A I don't remember ever signing it or seeing that piece
2 of paper, although I admit that that is my handwriting.
3 Q Did you say you don't admit or you do admit?
4 A I do. That is my signature.
5 Q If it is your signature, and you put it on the
6 original piece of paper, can we agree that it was after
7 January 10th, 1990. I think you indicated you had not
8 even made the investment yet as of January 10th.
9 A That's right.
10 Q And if you had been given this document back on
11 January 10th, 1990, certainly it would have been very
12 strange at that point, you were not in a position at that
13 time to be signing these documents?
14 A That's correct.
15 Q There did come a point of time when you did get
16 documents from Who's Who Worldwide, when you would sign
17 them and return them; is that correct?
18 A Occasionally that would happen. But mostly my
19 husband would sign them.
20 Q It would mainly be your husband?
21 A Yes.
22 Q And when they would come would they be given -- would
23 your husband receive them and sometimes give you a
24 document or two from a packet and then have you sign it?
25 A Yes.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
720
J. Grossman-cross/Trabulus
1 Q And then it would go back?
2 A Yes.
3 Q And, of course, some of these would be bank
4 documents?
5 A Yes.
6 Q And some would relate to credit card accounts?
7 A Yes.
8 Q And did anybody explain to you why you would be
9 signing something relating to a bank document?
10 A I questioned Bruce.
11 Q And what did he tell you?
12 A Myself. And he said that it was only as a protection
13 in case something happened to him that I and perhaps my
1
4 sons would be available to carry on his business.
15 Q And the credit card documents as well? Did you sign
16 documents relating to that?
17 A Yes.
18 Q And when you signed these documents, was there
19 anything under your name, like a title?
20 A I don't recall.
21 Q Well, when you say you don't recall, is it that today
22 you don't recall one way or another, or did you not know
23 this at the time?
24 A I guess I didn't notice.
25 Q Okay.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
721
J. Grossman-cross/Trabulus
1 Certainly when you signed bank documents, you
2 were not signing documents relating to your own personal
3 bank accounts; is that right?
4 A That's right.
5 Q You understood when you were signing them, you were
6 signing them in some sense relating to your relationship
7 to Who's Who?
8 A Yes. And I did question it at that time.
9 Q Okay.
10 Did you ask Mr. Gordon why a title would appear
11 if it did --
12 A I wasn't as concerned about a title, but as to why I
13 was signing bank documents for a business I had nothing to
14 do with.
15 Q Okay.
16 Now, did you ever -- did Mr. Gordon ever ask you
17 in signing a document, not to read it?
18 A No, he never did.
19 Q Did Mr. Gordon ever tell you, we are going to be
20 sending over some documents, and I just want you to sign
21 it, and you don't have to bother looking at it; did he ask
22 you that?
23 A No.
24 Q Did your husband ever tell you that Mr. Gordon asked
25 you not to look over any document?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
722
J. Grossman-cross/Trabulus
1 A Absolutely not.
2 Q So, as far as you knew, if
you signed a document and
3 returned it, or had it returned to Mr. Gordon or Who's
4 Who, Mr. Gordon would have no reason to believe that you
5 had not looked at it; is that correct?
6 A That is correct.
7 Q Now, I think you testified that you never gave
8 Mr. Gordon the authority to vote your shares?
9 A That's correct.
10 Q Have you ever given anybody authority to vote shares
11 that you owned of anything?
12 A I have never owned any shares of anything.
13 Q Again, not to pry too much in your personal affairs,
14 but do either you or the family own any stocks in the
15 family trust perhaps?
16 A Yes.
17 Q And do you ever get proxy statements?
18 A Yes.
19 Q And proxy statements are where the management of the
20 company or maybe somebody else asks for your authority to
21 vote the share; is that correct?
22 A I throw them away.
23 Q These are written forms, and you understood if you
24 wanted to give the authority you would simply write in the
25 form and mail it back, and you would not have to talk to
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
723
J. Grossman-cross/Trabulus
1 anybody about it, you would simply do it?
2 A I would not do it.
3 Q But you --
4 A The reason I threw them away is because I didn't
5 understand anything about the situation.
6 Q So, you didn't want to give your authority to vote
7 the shares over to some management that you didn't know
8 anything about; is that correct?
9 A That's correct.
10 Q In fact, you did own, you and I should say your
11 family trust, and your husband's defined benefit plan, I
12 think we have no disagreement that they owned, and
13 certainly in the beginning, 25 percent; is that right?
14
A That's correct.
15 Q Now, is it fair to say that you and your husband had
16 agreed and understood that Mr. Gordon would basically be
17 running this company?
18 A That's right.
19 Q And that it was going to be something -- I think you
20 said you were going to be basically silent partners?
21 A Yes.
22 Q Is it fair to say that you did get involved to a
23 certain extent, but basically as Mr. Gordon requested?
24 A Involved how?
25 Q Well, did there come a point in time that Mr. Gordon
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
724
J. Grossman-cross/Trabulus
1 came to California, and either at that point or beforehand
2 told you that he was interested in opening up an office in
3 California?
4 A Yes. But my involvement was strictly on a decorating
5 basis.
6 Q From California?
7 A Yes.
8 Q Did you recommend a real estate broker to Mr. Gordon,
9 other than the one he used, but a real estate broker in
10 order to find leased space for an office?
11 A Yes.
12 Q And Mr. Gordon then went to another real estate
13 broker, a Mr. White, Darren White?
14 A I remember Darren.
15 Q C.B. Realty, or something like that?
16 A Yes.
17 Q And do you remember Mr. Gordon -- withdrawn.
18 Do you recall there was actually plans made for
19 the space?
20 A Yes, my company made the plans.
21 Q Do you recall also that Mr. Gordon was interviewing
22 people possibly to work in that space?
23 A Yes.
24 Q He came with his company, with people from his
25 company out there?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
725
J. Grossman-cross/Trabulus
1 A Two other people.
2 Q And you have a son named Michael; is
that correct?
3 A Yes.
4 Q He is successful in business; is he not?
5 A Fairly successful. He is a salesman.
6 Q Do you recall Mr. Gordon discussing with you the
7 possibility of Michael coming into the business?
8 A Yes, he did.
9 Q Did Mr. Gordon tell you that his own sons,
10 Mr. Gordon's own sons, were not really suited to operate
11 in a business -- to operate in a business at all?
12 A Yes.
13 Q And he thought that Michael might be?
14 A Yes.
15 Q And did he discuss with you that he, Mr. Gordon, was
16 getting on in years, and was looking forward -- was
17 looking to eventually getting out of the business or
18 simply being a consultant?
19 A Yes.
20 Q And he was considering having Michael run the
21 business?
22 A Yes.
23 Q Now, based on those discussions was Mr. Gordon
24 seriously suggesting the possibility that the business
25 would pass through his hands to Michael's?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
726
J. Grossman-cross/Trabulus
1 A Michael wasn't interested.
2 Q But this is somebody that Mr. Gordon was suggesting,
3 correct, even though Michael wasn't interested?
4 A It wasn't a serious discussion. It was a top of the
5 head discussion.
6 Q It was something he brought up?
7 A Yes.
8 Q Mr. Gordon brought up?
9 A Yes.
10 Q And because Michael was not interested you regarded
11 it as a top of the head discussion; is that right?
12 A That's what it was.
13 Q Now, I assume since you don't remember signing this,
14 that you don't remember whether any other documents
15 accompanied it or were signed with it when you signed it?
16 A That's correct.
17 Q Now, if this were sent back to Mr. Gordon, you would
18 have no reason for thinking that Mr. Gordon wouldn't be
19 able to rely on it, would you?
20 A I never thought about it. I never saw that until I
21 was in the -- my lawyer's office.
22 Q Now, when you say you never saw it -- when you say
23 your lawyer's office, which lawyer?
24 A Mr. Picard.
25 Q Okay.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
727
J. Grossman-cross/Trabulus
1 When you say you never saw it until you were in
2 Mr. Picard's office, is it fair that you never focussed on
3 it until you were in Mr. Picard's office?
4 A You can say that. I never saw it.
5 Q If you signed it, presumably you didn't sign it with
6 your eyes closed; is that right? You probably did see it
7 if you signed it? You may not have paid any attention to
8 it?
9 A I can tell you, I never saw that.
10 Q When
you say you never saw it, are you suggesting
11 that maybe you didn't sign it?
12 A That's my signature. I don't know.
13 Q Did you ask anybody to do a handwriting analysis on
14 it?
15 A I think a handwriting analysis was done. It was
16 indicated that that is my signature, and I am saying it is
17 my signature.
18 Q Okay.
19 Do you know who did the handwriting analysis?
20 A Someone in the government.
21 MR. TRABULUS: Your Honor, I would call for
22 production of the handwriting analysis, if there was one.
23 THE COURT: Was there a handwriting analysis done
24 of this signature?
25 MR. WHITE: No, your Honor. Analysis was done on
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
728
J. Grossman-cross/Trabulus
1 this document, but not a handwriting analysis.
2 MR. TRABULUS: Okay.
3 Q Now, did there come a point in time when you learned
4 that there had been a raid on the witness, on the Who's
5 Who?
6 A Yes.
7 Q Now, did there also come a point in time when there
8 was a message on your answering machine in California from
9 Mr. Gordon that he needed money right away to hire an
10 attorney in connection with that? Do you recall that?
11 A No, I do not.
12 Q Do you recall loaning or sending money to an attorney
13 in connection with that?
14 A I never sent any money to an attorney.
15 Q Do you recall sending $15,000, or asking somebody
16 else to send $15,000?
17 A No, I did not.
18 Q Do you recall any instance in which you loaned
19 $15,000, or paid $15,000, and Mr. Gordon repaid you
20 $18,000 on that loan afterwards?
21 A No.
22 Q Okay.
23 Were there occasions when you came to New York
24 and visited the premises of Who's Who?
25 A Yes.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
729
J. Grossman-cross/Trabulus
1 Q And when you visited those premises, which ones did
2 you visit?
3 A The one in Lake Success.
4 Q And did you also visit the condominium in Manhasset,
5 200 hummingbird?
6 A Yes.
7 Q How many times had you been there?
8 A Twice.
9 Q Did you see that there was an office there?
10 A Yes.
11 Q And can you describe what you saw by way of the
12 office?
13 A A desk, a computer, all the equipment that an office
14 has.
15 Q Okay.
16 Did you see Mr. Gordon working there?
17 A He was showing me the entire physical space.
18 Q Now, you participated in -- your company decorated --
19 A Yes.
20 Q -- the condominium?
21 Did Mr. Gordon discuss with you what the
22 condominium was going to be used for?
23 A He was going to live there, entertain there, and that
24 was it.
25 Q Did he talk about members of Who's Who possibly
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
730
J. Grossman-cross/Trabulus
1 staying there?
2 A He mentioned it briefly.
3 Q Did he talk about people being brought in from out of
4 town, perhaps employees staying there while they were
5 being trained?
6 A Yes.
7 Q Now, let's go to the penthouse facility in Manhattan.
8 Your company also participated in decorating
9 that?
10 A Yes.
11 Q Is that right?
12 And were there discussions as to what that was
13 going to be used for?
14 A Entertainment.
15 Q Entertaining whom?
16 A Out of country or out of the city clients for
17 networking and business.
18 Q When you say clients, you mean people who were
19 members of Who's Who Worldwide?
20 A Yes.
21 Q And were you aware of any instances in which that
22 occurred, parties, cocktail parties, receptions?
23 A I heard about two of them.
24 Q Okay.
25 Now, the testimony you had, your conversation of
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
731
J. Grossman-cross/Trabulus
1 the testimony you had with Mr. Gordon at the place he was
2 living, your reaction -- withdrawn.
3 His response was when you asked him, how could
4 you say that I was a 75 percent shareholder? His
5 statement to you was, weren't you?
6 A Uh-huh.
7 Q And he indicated to you at that point that he thought
8 you were?
9 A That's all he answered, in quotes, aren't you, end
10 quote.
11 Q And you say he said that he had bad advice?
12 A Yes.
13 Q And did you ask him what the advice was?
14 A I said, what do you mean?
15 He said, I don't want to discuss it any further.
16 Q Did you understand him to mean -- withdrawn.
17 Now, you indicated you are testifying under a
18 grant of immunity.
19 Mrs. Grossman, is it fair to say that you don't
20 believe you committed any crime or did anything wrong?
21 A Absolutely not.
22 Q Absolutely not, you did not commit any crime?
23 A I did not commit any crime.
24 Q And I am not saying you did.
25 And your husband also, he was also testifying
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
732
J. Grossman-cross/Trabulus
1 under a grant of immunity?
2 A That's correct.
3 Q And is it fair to say that you have the same view as
4 to him, that he absolutely did not do anything wrong?
5 A That's correct.
6 Q Now, there came a point when you and your husband
7 were sued by a bankruptcy trustee; is that correct?
8 A That is correct.
9 Q And is it fair to say that the bankruptcy trustee
10 alleged that you and your husband, along with Mr. Gordon
11 controlled Who's Who and some other companies?
12 A I guess they alleged that.
13 Q And the allegation was that some monies from Who's
14 Who were misapplied to yourself or other companies? Do
15 you recall that allegation, or something to that effect?
16 A The bottom line was --
17 Q I am not asking the bottom line.
18 A I am not aware of anything else, except for the
19 bottom line.
20 Q I am just asking whether or not -- and I am not
21 saying it was right -- but that you were accused by the
22 trustee of engaging in wrongdoing along with your husband
23 and Mr. Gordon relating to the assets of Who's Who; is
24 that fair to say?
25 A
I really don't know.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
733
J. Grossman-cross/Trabulus
1 Q Okay.
2 Did you understand that the trustee was alleging
3 that you and your husband together were -- or you and the
4 trust, and so forth, owned all of Who's Who?
5 A Yes.
6 Q And that allegation was something that you wanted to
7 refute; is that correct?
8 A That's correct.
9 Q And, indeed, when Mr. Picard showed you 582, your
10 lawyer in the bankruptcy, that was something which he
11 showed you in connection with whether or not that
12 allegation was true or not; is that right?
13 A That's correct.
14 Q You have no reason to believe -- withdrawn.
15 We know this was signed after January 10th --
16 THE COURT: What is this?
17 MR. TRABULUS: I am sorry, 582. And I am showing
18 her 582-A.
19 Q We
can agree that this was signed after January 10th?
20 A Since I don't recall any of the wording in that, or
21 my having signed that particular letter --
22 Q Do you think it might have been signed January 10th,
23 1990?
24 A I can't really tell you. I don't recall ever seeing
25 that letter.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
734
J. Grossman-cross/Trabulus
1 Q Okay.
2 You have absolutely no idea as to when it was
3 signed?
4 A That's correct.
5 Q Do you recall when the last time was that you signed
6 stuff and sent it back to Mr. Gordon?
7 A No. I signed very few things.
8 Q And do you remember, was there a point in time when
9 that stopped?
10 A I can only guess.
11 Q What is your guess?
12 A When we started receiving legal documents from
13 Backenworth and Grossman, from approximately that time, or
14 just before then.
15 Q Mrs. Grossman, did you also help on buying art work
16 for the offices of Who's Who?
17 A Yes, I did.
18 Q You helped select that artwork?
19 A I purchased it all.
20 Q Okay.
21 And do you know how -- was that paid with Who's
22 Who's money, do you know?
23 A Yes.
24 Q And did Mr. Gordon go with you when you purchased it?
25 A No. My husband did.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
735
J. Grossman-cross/Trabulus
1 Q Did you also -- at the penthouse did you see artwork,
2 decorations and urns, did you see fairly expensive looking
3 artwork?
4 A I selected it.
5 Q Was there stuff there that you didn't select as well?
6 A Yes, there was.
7 Q Can you just describe what some of that was.
8 A Important glass pieces from Italy, and imported. And
9 other accessories.
10 Q When you say important, you mean high quality?
11 A Lovely things.
12 Q And that was in the facility that you understood to
13 be used for entertaining, networking and so forth?
14 A Yes.
15 MR. TRABULUS: No further questions.
16 THE COURT: Anybody else want a
17 cross-examination?
18 MR. GEDULDIG: A few questions, your Honor.
19
20 CROSS-EXAMINATION
21 BY MR. GEDULDIG:
22 Q Mrs. Grossman, between the period of 1990 and
23 approximately 1995, were you misled by your brother --
24 MR. TRABULUS: Objection, your Honor.
25 THE COURT: Can I hear the question again,
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
736
J. Grossman-cross/Geduldig
1 please?
2 MR. GEDULDIG: I have not finished.
3 THE WITNESS: May I ask who you are?
4 Q My name is Martin Geduldig,
and I represent the lady
5 with the dark hair?
6 A Who is she?
7 Q One of the defendants in this case with your brother,
8 she is charged in crimes involving Who's Who.
9 Have you ever seen that lady before?
10 A No.
11 Q Okay.
12 The question I was going to ask you is this:
13 Between the period of 1990 and 1995, were you misled by
14 your brother regarding your ownership position, the stock
15 that you held the percentage that it represented, in the
16 ownership position of Who's Who Worldwide?
17 MR. TRABULUS: Objection.
18 THE COURT: Sustained. I don't understand what
19 that question means. Therefore I am thinking that perhaps
20 the witness doesn't.
21 Do you mean were there false representations
22 made? What do you mean by misled? Was she given the
23 wrong address for the office? What do you mean by
24 misled?
25 Q
Were you misled by your brother regarding the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
737
J. Grossman-cross/Geduldig
1 percentage of stock that you believed to own in the
2 company Who's Who Worldwide?
3 MR. TRABULUS: Objection, your Honor.
4 THE COURT: Did your brother ever make a
5 representation to you with respect to how much stock you
6 had in the company?
7 THE WITNESS: Did he verbally tell me?
8 THE COURT: Verbally and in writing.
9 THE WITNESS: Not until all of this came to pass
10 in the lawyers' offices, or the prosecutors' offices, did
11 I ever see anything. He never said anything to me.
12 THE COURT: All right.
13 Q Did you not testify on direct examination that your
14 brother told you that you would have a 25 percent interest
15 in the company, and you expressed the thought that you
16 didn't want any
interest in the company at all?
17 A That was at the very beginning, before we even
18 invested anything.
19 Q Was that in 1990?
20 A Yes.
21 Q And your brother insisted that you take an interest,
22 a percentage of the stock in the company?
23 A Yes.
24 Q And he told you it would be 25 percent?
25 A Yes.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
738
J. Grossman-cross/Geduldig
1 Q And that was in 1990?
2 A Yes.
3 Q And it came to pass that you believed in fact you
4 owned through your husband or through the pension plan
5 that you and your husband had, or through the trust fund
6 that you and your husband had, you came to believe that
7 you owned 25 percent of the stock in Who's Who; is that
8 correct?
9 A Yes.
10 Q And did not your brother tell you that you owned 25
11 percent of the
stock in Who's Who?
12 A He never repeated it. It was a one time
13 conversation. And that's what I assumed until all this
14 came to pass.
15 Q And thereafter, did you learn that representations
16 were made by your brother that you, your husband, or the
17 pension plan, or the trust that you and your husband
18 controlled were claimed to own 100 percent --
19 MR. TRABULUS: Objection, your Honor. May we
20 approach?
21 THE COURT: All right. Come up.
22
23 (Whereupon, at this time the following took place
24 at the sidebar.)
25 MR. TRABULUS: Your Honor, I am going to object
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
739
J. Grossman-cross/Geduldig
1 to this entire line of questioning by Mr. Geduldig,
2 because frankly, the evidence that this witness gave was
3 not in any respect against his client. The only things
4 she testified to that remotely pertained to his client
5 would be entirely favorable, tending to show the
6 legitimacy of the operation of Who's Who Worldwide.
7 What he is trying to do is to set a stage, set
8 the stage for the argument down the road that my client,
9 Mr. Gordon lied to his own sister, and therefore you can
10 assume that he lied and took advantage to his own client.
11 And frankly, I don't believe it is a proper use of the
12 cross examination here. Really, I don't think he should
13 be permitted to do this.
14 THE COURT: That raises some interesting issues.
15 Number one, whether a defendant who is not
16 expressly incriminated by the testimony of a witness has a
17 right to cross-examine that witness. And my opinion is
18 that any lawyer in the case does have a right to
19 cross-examine. If you have any authority that says that
20 they do not -- I think it is discretionary on my part, and
21 I will certainly let him do that.
22 If the purpose is to show that Mr. Gordon
23 misrepresented things to people, and, therefore, is likely
24 to misrepresent things to his own employees, I will let
25 him try to do that. They are part of this case. And as I
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
740
J. Grossman-cross/Geduldig
1 mentioned in the motion to sever, that it sometimes is
2 advantageous to be in the case with a major player when
3 you have a minor player, sometimes very advantageous.
4 MR. WALLENSTEIN: My sentiments exactly.
5 MR. JENKS: Judge, what appears -- Edward Jenks
6 for the corporations.
7 What appears to be developing here, and I believe
8 what Mr. Trabulus is complaining about, is a set of
9 antagonistic defenses are beginning to develop, at least
10 through Mr. Geduldig at the current moment, and namely,
11 that Bruce Gordon made misrepresentations to everyone, and
12 their clients were misled along with the rest of the
13 family members and never intended to defraud anyone in the
14 substantive mail fraud or conspiracy to commit mail fraud.
15 Essentially, I think all the employees, what
16 Mr. Trabulus is complaining of, is antagonistic defenses
17 in the case.
18 MR. TRABULUS: That's true.
19 MR. LEE: If I can say something.
20 Winston Lee, for Laura Weitz. Mr. Geduldig
21 jumped up before I could say I have some questions. But I
22 also intend to ask Mrs. Grossman some questions. I wanted
23 everyone to be aware of that.
24 MR. TRABULUS: Your Honor, we have here basically
25 propensity evidence being developed by co-defendants
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
741
J. Grossman-cross/Geduldig
1 against my client. It is like a 404(b) type situation.
2 What the government elicited from her is relevant
3 to the evidence that the government was trying to prove.
4 But I don't believe it should be admissible for the issues
5 which the defense is seeking to raise it. I understand
6 your Honor has the discretion to permit them to question
7 witnesses, but we are talking about the particular
8 questions going on here. They are trying to develop
9 propensity evidence against my client in support of an
10 antagonistic defense.
11 THE COURT: I was thinking about that,
12 Mr. Trabulus, about 404(b). However, we are talking about
13 cross-examination and untruthfulness.
14 Truthfulness is always a prime reason to
15 cross-examine and bring out questions. So, it may be that
16 another ancillary purpose, if he did lie to his own
17 sister, that he would lie to anybody. I can't prevent
18 that.
19 MR. TRABULUS: It seems to me they are calling
20 negative character witnesses before we call any character
21 witnesses.
22 I agree there would be a basis to cross-examine
23 Mr. Gordon on these things if he were to testify because
24 his truthfulness can be brought in. But we are getting to
25 a situation here of what amounts to character evidence,
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
742
J. Grossman-cross/Geduldig
1 and very prejudicial, because it is his own sister being
2 used as a negative character witness on truthfulness.
3 I submit, your Honor, it is not proper and highly
4 prejudicial, specifically when being used as clearly an
5 antagonistic defense, which is now emerged.
6 MR. WHITE: Your Honor, Mr. Trabulus is talking
7 about propensity evidence and 404(b). This is direct
8 evidence of the tax charges against Mr. Gordon.
9 Based on what Mr. Geduldig did yesterday with
10 Dr. Grossman, and what he started to do today with
11 Mrs. Grossman, it sounds that he is just going over the
12 transactions that she has already testified about, and
13 clearly relevant, and Mr. Trabulus didn't object to on the
14 tax charges. He has to live with it. It is not
15 propensity or 404(b) evidence.
16 THE COURT: It is also -- there is also
17 documentary evidence, where your client said that the
18 Grossmans owned more than 25 percent of the stock. And
19 some of it is signed by him.
20 MR. TRABULUS: No question, and signed by
21 Mrs. Grossman.
22 THE COURT: That's in the case.
23 MR. LEE: Your Honor, relevance is motivation to
24 testify, and prejudice and bias, which I think whatever
25 the individual parties' reasons are, it is relevant, the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
743
J. Grossman-cross/Geduldig
1 motivation to testify, and bias.
2 THE COURT: To testify against her brother?
3 MR. LEE: To testify as she had testified,
4 whether it is prejudice or bias.
5 MR. TRABULUS: At this point I would move to
6 sever from Mr. Geduldig's client.
7 MR. GEDULDIG: You are asking me to get out of
8 the case, or you want to get out of the case?
9 MR. TRABULUS: I just don't think we ought to be
10 tried together.
11 THE COURT: I would like to look into this
12 question of antagonistic defenses further, so I will
13 reserve decision on that.
14 Anything else now?
15 MR. TRABULUS: Nothing else.
16 MR. WHITE: The only thing I can say is I know I
17 can refer your Honor Zafiro versus U.S.
18 THE COURT: I don't know. I need all the help I
19 can get.
20 MR. WHITE: Z A F I R O, versus U.S. It is a
21 Supreme Court case, which says -- on severance, your
22 Honor, where it says the claimed basis for the severance
23 is antagonistic defenses. It has to be so antagonistic
24 that it means to convict one you have to acquit the
25 other. And that's not the case here.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
744
J. Grossman-cross/Geduldig
1 MR. JENKS: That's exactly the case, because the
2 way Mr. Geduldig is handling the defense is going to be
3 like this: He is going to say that there may have been
4 all sorts of misrepresentations made concerning the mail
5 fraud, but the employees were not aware of the
6 misrepresentations, the misrepresentations were made by
7 Mr. Gordon and not the employees. Gordon's defense by
8 Trabulus on the mail fraud I assume is there was not a
9 mail fraud period, there was no misrepresentations made,
10 it was maybe puffery, but that's all. So that is striking
11 the defenses you maintain in that Supreme Court case.
12 MR. TRABULUS: If there were any
13 misrepresentations it was made initially by the employees,
14 and Mr. Gordon was not aware of it.
15 THE COURT: I do not believe at this point that
16 there are antagonistic defenses, if there are any, that it
17 rises to such a level that it calls for any severance.
18 And I will take a look at the law. As I said I will
19 reserve decision.
20 Let's proceed.
21
22 (Whereupon, at this time the following takes
23 place in open court.)
24 Q Mrs. Grossman, let me try to rephrase the question I
25 was about to ask you.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
745
J. Grossman-cross/Geduldig
1 There came a point in 1990, either through
2 conversations or letters, where you came to believe that
3 you and your husband, either personally or through your
4 trust, or your pension plans, owned 75 percent of the
5 stock in Who's Who; is that right?
6 A 1990?
7 Q Yes. Roughly May of 1990?
8 A 75 percent?
9 Q Did I say that? 25 percent, I am sorry. That you
10 owned 25 percent of the stock of Who's Who?
11 A 25 percent, yes.
12 Q And thereafter you came to learn -- withdrawn.
13 And that 25 percent stock ownership was a
14 representation you learned about through conversations, or
15 through letters, telephone conversations or face to face
16 with your brother; is that right?
17 A The 25 percent?
18 Q Correct.
19 A Correct.
20 Q And years later you came to learn that there were
21 representations made by your brother that you or your
22 husband either personally or through the trust and pension
23 plan that you had owned 100 percent, or 75 percent of the
24 stock in Who's Who; is that right?
25 A We saw it in the papers we were shown, right.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
746
J. Grossman-cross/Geduldig
1 Q My question to you is: Were you misled by your
2 brother regarding the percentage of the stock that you and
3 your husband personal or through your trust or pension
4 plans owned in the company, Who's Who?
5 MR. TRABULUS: Objection.
6 THE COURT: Sustained.
7 Q Did you believe you had any active role to play in
8 the operation of Who's Who from roughly 1990 to roughly
9 1995?
10 A None whatsoever.
11 Q Did you come to learn that there were representations
12 made that you personally did have a role
to play in the
13 operation of that company?
14 MR. TRABULUS: Objection.
15 THE COURT: Learn in what way?
16 Q Through documents or through conversations with your
17 brother.
18 THE COURT: One at a time.
19 Q Did you learn through documents that you viewed at
20 your lawyer's office?
21 MR. TRABULUS: Objection. Relevance.
22 THE COURT: I didn't hear the end of the
23 question.
24 MR. TRABULUS: I am sorry.
25 Q That you had a role to play in the operation of Who's
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
747
J. Grossman-cross/Geduldig
1 Who?
2 MR. TRABULUS: Objection.
3 THE COURT: Sustained.
4 MR. GEDULDIG: Nothing else.
5 THE COURT: Mr. Lee, did you have any questions?
6 MR. LEE: Yes. Thank you, Judge.
7
8 CROSS-EXAMINATION
9 BY MR. LEE:
10 Q Good morning, Ms. Grossman.
11 My name is Winston Lee, L E E. I am an attorney,
12 and I represent a person by the name of Laura Weitz, a
13 salesperson employee of Who's Who Worldwide Registry. Do
14 you understand that?
15 A Yes.
16 Q Now, you recall when Mr. Trabulus was asking you some
17 questions, you responded that you recall that there came a
18 time when a bankruptcy trustee was alleging that your
19 ownership of Who's Who was greater than it really was, he
20 was alleging perhaps a 100 percent ownership or
21 involvement by you and your husband; is that correct?
22 A I never really read all the documents, but I
23 understand that.
24 Q That is what this bankruptcy trustee was alleging as
25 far as you and your husband was concerned, that your
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
748
J. Grossman-cross/Lee
1 involvement was greater than what it really was; is that
2 correct?
3 A Yes.
4 Q In your mind it was an unjust accusation on the part
5 of this trustee against you and your husband, correct?
6 A Correct.
7 Q And in your mind, the person who placed you in that
8 position, where you were unjustly accused of something,
9 doing something you did not do, that person was your
10 brother, Bruce Gordon, correct, as a result of his actions
11 that you were placed in that position; is that correct?
12 A Are you asking me how I feel about it?
13 Q Yes.
14 A I don't feel anything like that. I feel that the
15 trustee was out to close him down and take anybody along,
16 that had anything to do with the company.
17 Q You feel that the trustee was acting on accurate or
18 inaccurate information when he made these accusations
19 against you and your brother?
20 A I think they would have used anything they could to
21 close him down and take anybody along with him that they
22 could.
23 Q And there are claims against you and your husband,
24 they were based upon what? What was the basis upon which
25 they brought you into the bankruptcy proceedings? What
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
749
J. Grossman-cross/Lee
1 was the basis for doing that?
2 MR. TRABULUS: Objection.
3 THE COURT: Sustained.
4 MR. LEE: I have no further questions, your
5 Honor.
6 THE COURT: Anybody else?
7 MR. WALLENSTEIN: Yes, your Honor.
8
9 CROSS-EXAMINATION
10 BY MR. WALLENSTEIN:
11 Q Good morning, Ms. Grossman.
12 My name is John Wallenstein, and I represent
13 Martin Reffsin; do you know that name?
14 A I heard of it.
15 Q Have you ever met Mr. Reffsin?
16 A No, I have not.
17 Q Have you spoken to Mr. Reffsin?
18 A No, I have not.
19 Q Ever have any business dealings with Mr. Reffsin?
20 A No, I have not.
21 Q You understand Mr. Reffsin was an accountant doing
22 accounting work for your brother and his companies; is
23 that correct?
24 A Correct.
25 Q How long have you been in business, Ms. Grossman?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
750
J. Grossman-cross/Wallenstein
1 A Over 30 years.
2 Q How many employees have you had over that time on
3 average?
4 A Not together, at one time?
5 Q Yes.
6 A Over the years, about six, seven.
7 Q And on the average, how many employees do you have at
8 any one given time?
9 A One.
10 Q And does your company operate as a corporation?
11 A No.
12 Q Do you employ an accountant?
13 A Yes.
14 Q And is that the same accountant that your husband
15 uses?
16 A Yes.
17 Q And your husband operates a dental practice; is that
18 correct?
19 A Yes.
20 Q And that involves both the professional end, the
21 dental end of it, and the business end of the practice; is
22 that correct?
23 A What does?
24 Q His operation of his dental practice, it is a
25 business, isn't it?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
751
J. Grossman-cross/Wallenstein
1 A Yes.
2 Q Okay.
3 Both of you are the trustees of a family trust?
4 A Yes.
5 Q And the beneficiary of that trust are other than
6 yourself, but other people are the beneficiaries of the
7 trust?
8 A When my husband dies, I am the beneficiary, and vice
9 versa, and we both die, the children are.
10 Q Your children are the beneficiaries of the trust?
11 A Yes.
12 Q And you and your husband are the beneficiaries of his
13 retirement plan?
14 A He is.
15 Q He is?
16 A Yes.
17 Q And is it fair to say between the trust and the
18 retirement plan, your business and your husband's
19 business, that there is several hundred thousand dollars
20 to be taken care of?
21 A Yes, on retirement.
22 Q And that has been the case for many years; is that
23 correct?
24 (No response.)
25 Q And that's the case for many years; is that correct?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
752
J. Grossman-cross/Wallenstein
1 A Yes.
2 Q And particularly the time between 1990 and 1995, the
3 trust and the retirement plan controlled assets of several
4 hundred thousand dollars, and you and your husband were
5 the administrators of those plans; is that correct?
6 A That's correct.
7 Q And during that time you also operated a fairly
8 successful decorating business?
9 A Yes.
10 Q And approximately how many corporate clients did you
11 have in that time period?
12 A You mean how many of my clients own corporations?
13 Q Let me rephrase the question. It is a bad question:
14 During that time period how many of your clients
15 were corporate clients as opposed to individuals wanting
16 to decorate their homes?
17 A Half were corporate clients.
18 Q Approximately what is that number?
19 A Most were attorneys.
20 Q What is the number, that's the question?
21 A Half a dozen.
22 Q Okay.
23 In the period, say 1980 to 1990, approximately
24 how many business people did you have as clients?
25 A A dozen.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL
COURT REPORTER
753
J. Grossman-cross/Wallenstein
1 Q Was it unusual -- withdrawn.
2 Other than the work that you did for your brother
3 and his companies, had you ever had occasion on other
4 times, or for other clients, to receive corporate monies
5 for the decoration of personal residences or personal
6 offices?
7 A Sometimes.
8 Q Would you say that that was not unusual?
9 A It happened occasionally.
10 Q You got a business check from somebody, right?
11 A Yes.
12 Q Okay.
13 Did you question --
14 A No, I didn't.
15 Q Let me finish my question, and then you can say, no,
16 you didn't.
17 Did you question those people as to why they were
18 using business funds as opposed to personal funds, for the
19 purchase of any particular item?
20 A No, I did not.
21 Q When you came to New York to assist your brother in
22 the decorating of the offices in Lake Success, did you
23 physically see those offices?
24 A Yes.
25 Q There were people working there and it was an office;
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
754
J. Grossman-cross/Wallenstein
1 is that correct?
2 A Yes.
3 Q And when you visited the condo and decorated the
4 condo, it was your understanding that there would be a
5 business purpose for that as well; is that correct?
6 A Yes.
7 Q In fact, you received business checks for the
8 payments that he made to you for the condo; is that
9 correct?
10 A Yes.
11 Q And with respect to the decoration of the penthouse,
12 you understood there was a business purpose for that as
13 well?
14 A That was almost entirely business.
15 Q And you received business checks for purchases in
16 connection with that as well?
17 A Yes.
18 Q Am I correct that you did not charge a fee for
19 yourself for the decoration of Lake Success or the
20 penthouse?
21 A That's correct.
22 Q And for the condo, you took ten percent, just so your
23 junior partner could be paid; is that correct?
24 A That's correct.
25 Q And when you took the funds for the decoration of the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
755
J. Grossman-cross/Wallenstein
1 penthouse and Lake Success they were business checks -- I
2 am sorry -- they were business checks that were used for
3 the purchase of items for those locations; is that
4 correct?
5 A That is correct.
6 Q Would it be fair to say that when you got the
7 $400,000, or what was left of it after taxes at the end of
8 1992, you considered that to be in some respects repayment
9 for services rendered?
10 A That's right.
11 MR. WALLENSTEIN: Thank you, Mrs. Grossman.
12 No further questions, your Honor.
13 THE COURT: Anything else?
14 MR. WHITE: Yes.
15
16 REDIRECT EXAMINATION
17 BY MR. WHITE:
18 Q Mrs. Grossman, do you recall Mr. Trabulus asking you
19 whether Mr. Gordon had ever asked you not to read a
20 document that he sent you?
21 A I remember the question.
22 Q And your answer is that, no, Mr. Gordon had not done
23 that; is that right?
24 A That's right.
25 Q If Mr. Gordon had specifically asked you not to read
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
756
J. Grossman-redirect/White
1 a document that he wanted you to sign, would that have
2 aroused any suspicion in you?
3 A Of course.
4 MR. WHITE: No further questions, your Honor.
5 THE COURT: Anything else?
6 MR. TRABULUS: Yes, very briefly.
7
8 RECROSS-EXAMINATION
9 BY MR. TRABULUS:
10 Q Mr. Wallenstein asked you some questions about other
11 work you had done for other clients.
12 Let me ask you, the budget for the work you did
13 on the condo, the Lake Success offices, the penthouse, was
14 that typical within the range that you would have spent
15 for facilities of that type?
16 A Absolutely.
17 Q So, it is nothing unusually lavage for a business
18 facility?
19 A That's right.
20 Q Let me ask you, some of the things you saw in the
21 penthouse facility, the urns, the crystals, do you know if
22 they were paid by using an American Express cards that
23 Mr. Gordon was allowed to use?
24 A You mean the items I did not purchase?
25 Q That's correct.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT
REPORTER
757
J. Grossman-recross/Trabulus
1 A I have no idea as to that.
2 MR. TRABULUS: Thank you, that's all.
3 THE COURT: Anything else?
4 You may step down, Ms. Grossman.
5 (Whereupon, at this time the witness left the
6 witness stand.)
7 THE COURT: Members of the jury, we will take a
8 ten-minute recess. Please do not discuss the case and
9 keep an open mind. Please recess yourselves.
10 (Whereupon, at this time the jury leaves the
11 courtroom.)
12
13 (Whereupon, a recess is taken.)
14
15 THE CLERK: Jury entering.
16 (Whereupon, the jury at this time entered the
17 courtroom.)
18 THE COURT: Please be seated, members of the
19 jury.
20 You may proceed.
21 MS. SCOTT: Your Honor, the government calls
22 Jeanne Dietrich.
23 THE CLERK: Please raise your right hand.
24
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
758
1 J E A N N E D I E T R I C H ,
2 called as a witness, having been first
3 duly sworn, was examined and testified
4 as follows:
5
6 THE CLERK: Please state your name and spell your
7 last name slowly for the record.
8 THE WITNESS: My name is Jeanne Dietrich,
9 D I E T R I C H. First name, J E A N N E.
10
11 DIRECT EXAMINATION
12 BY MS. SCOTT:
13 Q Good afternoon, Ms. Dietrich.
14 A Good afternoon.
15 Q Can you tell us what you do for a living?
16 A Yes. I am employed as a physical scientist with the
17 Internal Revenue Service National Forensic Laboratory in
18 Chicago.
19 Q And what are -- how long have you been doing that
20 job?
21 A I have been there just a little over eleven years.
22 Q What are your responsibilities?
23 A We routinely examine document evidence to try and
24 determine how and when it was produced, if there were any
25 alterations done to it, the method of typewriting or
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
759
Dietrich-direct/Scott
1 printing, things like that.
2 Q Now, what was your job before you went to work at the
3 IRS?
4 A I worked at the Chicago Police Department Crime
5 Laboratory as a drug chemist.
6 Q How long did you do that?
7 A Approximately four and a half years.
8 Q And what education have you had?
9 A I have a bachelors of science in chemistry from
10 Illinois Benedict College which is in Lisle, L I S L E,
11 Illinois.
12 THE COURT: Do you want to move back a little
13 from the microphone? You have a very good strong voice
14 and it comes over well.
15 Q What other training have you had to prepare you for
16 your job?
17 A I have had quite a bit of in-house training at the
18 Internal Revenue Service lab with the document examiners
19 there, and also with the examiners at the U.S. Secret
20 Service laboratory and the Bureau of Alcohol Tobacco and
21 Firearms.
22 Q And what did that training consist of specifically?
23 A Primarily the concentration was on ink analysis,
24 which allows you to identify ink formulation, and the date
25 of production. Also various other document examining
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
760
Dietrich-direct/Scott
1 techniques, developing indentations, examining alterations
2 or obliterations, identifying typewriting, printing
3 processes.
4 Q Now, when you described identify indentations, what
5 do you mean by that?
6 A Indentations come about when, for instance, you write
7 on the top sheet of a pen and paper, you leave
8 indentations on the writing and the sheets underneath. We
9 can develop that writing and determine what it says, or
10 match it up with other entries we have in our documents.
11 Q Now, are you affiliated with any organizations as
12 part of your job?
13 A Yes, I am. I belong to both the American Academy of
14 Forensic Scientists, and the Midwestern Association of
15 Forensic Scientists.
16 Q How do you keep up with friends in your field?
17 A Most of those organizations holds annual meetings,
18 and workshops and seminars that concentrate on the field
19 and document examination.
20 Q Have you ever been qualified as an expert in forensic
21 document examinations?
22 A Yes.
23 Q How many times?
24 A Approximately 15 times.
25 Q Where have you been so qualified?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
761
Dietrich-direct/Scott
1 A Well, in U.S. district courts throughout the country,
2 and also in the state court in California.
3 Q Have you ever been rejected as an expert?
4 A No.
5 MS. SCOTT: I offer Ms. Dietrich as an expert in
6 forensic examination techniques.
7 MR. TRABULUS: No objection.
8 THE COURT: I qualify her as an expert in
9 forensic examination techniques, did you say?
10 MS. SCOTT: Yes.
11 Q Now, I am going to show you Government's Exhibits 582
12 through 588.
13 582 through 586 are in evidence, and 587 and 588
14 are stipulated --
15 MS. SCOTT: Your Honor, the government stipulated
16 that these are promissory notes executed by Bruce Gordon.
17 MR. TRABULUS: Of the organizations indicated on
18 the notes, yes.
19 THE COURT: You are offering those documents?
20 MS. SCOTT: Offering 587 and 588 in evidence.
21 THE COURT: Any objection?
22 MR. TRABULUS: No.
23 THE COURT: Government's Exhibits 587 and 588 in
24 evidence.
25 (Government's Exhibit 587 received in evidence.)
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
762
Dietrich-direct/Scott
1 (Government's Exhibit 588 received in evidence.)
2 THE COURT: You say they are promissory notes
3 signed by Bruce Gordon?
4 MS. SCOTT: Yes, Publishing Ventures, 587, and
5 588 is on behalf of Sterling Who's Who.
6 THE COURT: Very well.
7 Q Ms. Dietrich, have you seen these documents before?
8 A Yes, I have.
9 Q How do you recognize those documents?
10 A When I examine these I place my initials on the
11 bottom corner of each document.
12 Q What tests did you perform on those documents?
13 A Well, I perform a series of different examinations
14 that include an ink analysis, indentation examination. I
15 examine the printing processes, the typewriting and the
16 paper itself that the documents were made of.
17 Q What is an ink test?
18 A An ink examination is designed to identify a
19 particular ink formulation, and the manufacturer, and
20 determine when we can, if we can, when the particular
21 formulation was first manufactured, determine how many
22 different types of ink we have on our series of documents,
23 and determine, you know, how they were produced using that
24 ink.
25 Q And what is the purpose of discovering the time of a
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
763
Dietrich-direct/Scott
1 particular ink formulation?
2 A Well, by identifying the ink formulation that perhaps
3 was not manufactured until a
date that is after the date
4 that is on the document, we can tell that the document
5 could then not have been made until a certain time frame.
6 Q And how many ink tests have you performed in your
7 career?
8 A Oh, probably thousands.
9 Q And taking a look at Government's Exhibit 584 in
10 front of you, and actually, I will ask you to look at 583,
11 and I am showing you Government's Exhibits 583-A and
12 584-A.
13 Do Government's Exhibits 583 and 584-A contain
14 true and accurate enlarged representations of 583 and 584?
15 A They appear to.
16 MS. SCOTT: I offer Government's Exhibits 583-A
17 and 584-A.
18 THE COURT: Any objection?
19 MR. TRABULUS: No.
20 THE COURT: Government's Exhibits 583-A and
21 584-A, in evidence.
22 (Government's Exhibit 583-A received in
23 evidence.)
24 (Government's Exhibit 584-A received in
25 evidence.)
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
764
Dietrich-direct/Scott
1 Q Now, looking at Government's Exhibit 584, what was
2 the result of your ink test on that document?
3 A There is actually two different ink formulations on
4 that document. One is a blank ball pen ink. The other is
5 a black non-ball pen ink -- I take it back. They are two
6 black ball pen inks, but two different formulations.
7 The one used to create the Bruce Gordon
8 signature, use an ink formulation not available until
9 1993.
10 Q If you look at the date of the document, what is that
11 date?
12 A January of 1990.
13 Q Now, if you take a look at the minutes of the
14 meeting, that would be Government's Exhibit 583, what was
15 the result of your ink test on that document?
16 A It was actually the same formulation as the one I
17 spoke about, a black ball pen ink not manufactured until
18 1993.
19 Q What can you tell us about the inks on the other
20 documents?
21 A There were four other formulations I found on the
22 entries of the other document, and all of those four
23 matched ink available in 1990.
24 Q Just because the inks were available in 1990, does it
25 mean that the documents were signed in 1990?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
765
Dietrich-direct/Scott
1 A No, they could be signed any time after the inks
2 become available.
3 Q Now, can you tell the jury what an indentation test
4 is?
5 A Yes. As I said before, just for example, if you
6 write on the top sheet of a pad and paper, it leaves the
7 indentations of the writing on the sheets underneath. And
8 we can develop those indented impressions. And the
9 results of the examination comes out like a transparency
10 sheet.
11 With that transparency then, you cannot only read
12 the entries you have developed, but if you have other
13 documents to match up the writing with, you can actually
14 lay it right on top, to determine if the indentations you
15 developed came from a particular entry on a document you
16 have.
17 Q How many indentation tests have you performed in your
18 career?
19 A Again, probably thousands.
20 Q Now, looking at Government's Exhibit 585 and 584,
21 what was the result of your indentation test on 585?
22 A On Exhibit 585 I developed indentations, that the
23 first entry was a Richard Grossman signature. I matched
24 up that signature as coming from the Richard Grossman
25 signature on Exhibit 584.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
766
Dietrich-direct/Scott
1 MS. SCOTT: Is this going to work?
2 THE COURT: Go ahead.
3 Q You were saying the signature on 584, this signature,
4 matched an indentation that you found on this document
5 here?
6 A That's correct.
7 Q And can you indicate -- withdrawn.
8 I am showing 585-B. Do you recognize that?
9 A Yes.
10 Q What is that?
11 A Actually the transparency created from the
12 indentation analysis.
13 Q And which document does that transparency represent?
14 A This is from the examination of
15 Government's Exhibit 585.
16 MS. SCOTT: I offer Government's Exhibit 585-B,
17 your Honor.
18 MR. TRABULUS: No objection.
19 THE COURT: Government's Exhibit 585-B in
20 evidence.
21 (Government's Exhibit 585-B received in
22 evidence.)
23 MS. SCOTT: I would ask the Court's permission to
24 publish it to the jury?
25 THE COURT: Yes.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
767
Dietrich-direct/Scott
1 (Whereupon, the exhibit/exhibits were published
2 to the jury.)
3 MS. SCOTT: I need to add also, because it has an
4 unusual surface, it can't be removed from inside the
5 sleeve.
6 Q While the jury is examining 585-B, can you tell them
7 where on Government's Exhibit 585 you found the
8 indentation of Richard Grossman's signature?
9 A It appeared approximately where the
10 Government's Exhibit -- well, maybe more in the middle
11 than the Government's Exhibit sticker.
12 Q Is that over here?
13 A Well, a little higher and more toward the middle.
14 Q The upper left-hand corner of the exhibit?
15 A Approximately, I would think.
16 MS. SCOTT: I would like to give the jury a
17 moment to take a look
at the transparency as it goes
18 around.
19 THE COURT: What does this mean in lay language?
20 THE WITNESS: Your Honor, that means that when
21 this particular signature was executed --
22 THE COURT: What signature?
23 THE WITNESS: The Richard Grossman signature on
24 Government's Exhibit 584 --
25 THE COURT: Government's Exhibit 584 is a waiver
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
768
Dietrich-direct/Scott
1 of notice of special meeting dated January 3rd, 1990; is
2 that correct?
3 THE WITNESS: Correct.
4 THE COURT: There is a signature, Richard
5 Grossman on that.
6 THE WITNESS: Correct.
7 THE COURT: And what happens after that?
8 THE WITNESS: By the indentations I found, that
9 indicates that this document was physically on top of
10 Exhibit 585 when the Richard Grossman signature was
11 executed.
12 Q By that you mean this document, which is now marked
13 as 584-A, would have been on top of 585?
14 A Exactly.
15 Q For this signature, the Richard Grossman signature,
16 to be written on the upper left-hand corner?
17 A Correct.
18 Q Now, taking a look at Government's Exhibit 582, what
19 was the result of your indentation test on that document?
20 A Actually I developed some more indentations on the
21 first one. I think I only mentioned the Richard Grossman
22 signature.
23 Q Yes.
24 A Is that correct?
25 Q Yes, going back to Government's Exhibit 585, the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
769
Dietrich-direct/Scott
1 stock certificate, what else did you find on that
2 document?
3 A I also found an entry that reads Richard, sign as
4 secretary on all six, and then the 6 was in parenthesis,
5 and certified and sent back.
6 Q Now, approximately where on that stock certificate
7 did you find that indentation?
8 A That was approximately right in the center.
9 Q So, it would be about here, in the middle of the
10 document (indicating)?
11 A I would say yes.
12 Q I am pointing out the center of 585-A to show where
13 that indentation was located.
14 A Yes.
15 Q Did you find any other indentations on that document,
16 585?
17 A No, just that entry on the Richard Grossman
18 signature.
19 Q Okay.
20 I will turn your attention now to
21 Government's Exhibit 582.
22 What was the result of your indentation test on
23 that document?
24 A On this document I developed an indentation in the
25 lower left corner that read: Joyce must sign. And the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT
REPORTER
770
Dietrich-direct/Scott
1 must sign was underlined a couple of times.
2 Q Are you saying you found it right about here?
3 A Approximately, yes.
4 Q And that's the lower left-hand corner of
5 Government's Exhibit 582.
6 A Yes.
7 Q And I am showing you Government's Exhibit 582-B.
8 Do you recognize that?
9 A Yes, I do.
10 Q What is that?
11 A This again is the transparency that was developed
12 from the indentation exam of Government's Exhibit 582.
13 MS. SCOTT: I offer Government's Exhibit 582-B.
14 THE COURT: Any objection?
15 MR. TRABULUS: No.
16 THE COURT: Government's Exhibit 582-B in
17 evidence.
18 (Government's Exhibit 582-B received in
19 evidence.)
20 MS. SCOTT: I would also like to publish this
21 exhibit to the jury as well, your Honor.
22 THE COURT: Yes.
23 (Whereupon, the exhibit/exhibits were published
24 to the jury.)
25 Q Once again, you stated that that indentation is in
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
771
Dietrich-direct/Scott
1 the lower left-hand corner of the document?
2 A Yes.
3 Q What is the meaning of that result?
4 A That indicates to me that there was another piece of
5 paper, perhaps a note that was on top of
6 Government's Exhibit 582 when that particular entry was
7 written.
8 Q And the entry being, Joyce must sign?
9 A Yes.
10 Q And did you ever find a piece of paper that said,
11 Joyce must sign, on it?
12 A No, I did not.
13 Q Taking a look at Government's Exhibit 584, did you
14 perform an indentation test on that document?
15 A Yes, I did.
16 Q What was the result of that test?
17 A Again, I found a note on -- an entry in
the lower
18 left-hand corner, an entry that said, must sign, and
19 underlined. I also developed two different Richard
20 Grossman signatures.
21 Q I am showing you Government's Exhibit 584-B.
22 (Handed to the witness.)
23 Q Do you recognize that?
24 A Yes, I do.
25 Q What is that?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
772
Dietrich-direct/Scott
1 A This is the transparency from the indentation
2 examination of Government's Exhibit 584.
3 MS. SCOTT: I offer Government's Exhibit 584-B.
4 THE COURT: Any objection?
5 MR. TRABULUS: No.
6 THE COURT: Government's Exhibit 584-B in
7 evidence.
8 (Government's Exhibit 584-B received in
9 evidence.)
10 MS. SCOTT: Once again, I would like to publish
11 that exhibit for the jury, your Honor.
12 THE COURT: Yes.
13 (Whereupon, the exhibit/exhibits were published
14 to the jury.)
15 Q Ms. Dietrich, can you tell us where you found the
16 indentations on 584.
17 A Yes. The must sign entry was approximately in the
18 lower left corner. The two Richard Grossman signatures
19 are on the right side, about in the middle.
20 Q Approximately this area?
21 A Yes.
22 Q The middle of 584.
23 What does that result suggest to you?
24 A It suggests that there was at least one, if not
25 three, pieces of paper, on the top of Exhibit 584, when
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
773
Dietrich-direct/Scott
1 those three entries, the two Richard Grossman signatures
2 and the must sign entry, were written.
3 Q Did you ever see the documents that contained the
4 original Richard Grossman signatures and the must sign,
5 that you found the indentations of on
584?
6 A No. I could not match up the signatures with any of
7 the documents I had. I did not have that note at all.
8 Q Just for clarification, which of tests you performed,
9 between the ink test and the indentation test which did
10 you do first?
11 A We always do the indentation test first.
12 Q Why is that?
13 A To do the ink examination test we have to move small
14 little plugs from the document. We do any other
15 examinations first so we don't interfere with the results
16 when we do the ink exam.
17 Q You mentioned other tests you performed on the
18 documents. Can you briefly describe what those are?
19 A Yes.
20 First of all, I looked for watermark on the
21 paper, that is a mark put in during the manufacturing
22 process of the paper, the two stock certificates had
23 Weston, W E S T O N, bond water marks on it, information
24
from the manufacturer indicating that that water mark has
25 been around since about 1920. So that provided me with no
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
774
Dietrich-direct/Scott
1 dating information other than it has been available for 70
2 some years.
3 The other sheets did not have a water mark. I
4 did look at the printing process, they were all done with
5 what is known as an ink jet printer. I tried to identify
6 the type style, which I kind of came up with a general
7 type style, but nothing in particular, nothing specific,
8 because of a lack of enough letters to be able to identify
9 a specific type style.
10 MS. SCOTT: Thank you.
11 I have no further questions.
12 THE COURT: Cross-examination.
13 MR. TRABULUS: Thank you.
14
15 CROSS-EXAMINATION
16 BY MR. TRABULUS:
17 Q Good morning, Ms. Dietrich. Just a couple of
18 questions for clarification.
19 I believe you testified there was an ink used on
20 one -- on two of the documents, two of the signatures that
21 was not available until sometime in 1993; is that correct?
22 A Yes.
23 Q And specifically, you prepared a report in connection
24 with your examination, is that right?
25 A Yes, I did.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
775
Dietrich-cross/Trabulus
1 Q And the date on which that ink was first
2 manufactured, according to your report was January 4,
3 1993?
4 A Yes, sir.
5 Q Basically what you testified to was that with regard
6 to the various documents signed by Richard Grossman, it is
7 consistent with all them being signed pretty much on a
8 stack, with note it is indicating, must sign, or something
9 like that; is that fair enough?
10 A Yes, that is generally how you get the indentations.
11 Q The document that has the signature Joyce Grossman,
12 you also developed an indentation on that and it said must
13 sign?
14 A Specifically it said, Joyce must sign.
15 Q Joyce must sign?
16 A Yes.
17 Q And another one had Richard Grossman's signature and
18 it said must sign; is that right?
19 A Yes.
20 Q Can you tell us if the two must signs were in the
21 same handwriting?
22 A I am not a handwriting examiner, so, no.
23 Q Were they both underlined?
24 A Yes.
25 Q In a similar way?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
776
Dietrich-cross/Trabulus
1 A As similar as an underline can be.
2 Q I believe you said one of them had a couple of
3 underlines?
4 A Yes, that's true, one had two underlines, and one had
5 one.
6 Q So they are not impressions of the same writing, must
7 sign, two separate entries?
8 A Two separate.
9 MR. TRABULUS: No further questions. Thank you.
10 THE COURT: Anything else?
11 MS. SCOTT: Nothing further from the government.
12 THE COURT: You may step down.
13 Please call your next witness.
14 (Whereupon, at this time the witness left the
15 witness stand.)
16 THE COURT: Do you want to remove these
17 documents.
18 MR. WHITE: We will take this one, your Honor,
19 but this one here will be referred to.
20 THE COURT: All right.
21 MS. SCOTT: The government calls Steven Adler.
22 THE COURT: Rise, please, and raise your left
23 hand.
24
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
777
1 S T E V E N A D L E R ,
2 called as a witness, having been first
3 duly sworn, was examined and testified
4 as follows:
5
6 THE COURT: Please be seated.
7 State your full name and spell your name,
8 please.
9 THE WITNESS: Steven Adler, S T E V E N,
10 A D L E R.
11 THE COURT: You may proceed.
12
13 DIRECT EXAMINATION
14 BY MS. SCOTT:
15 Q Good morning, Mr. Adler.
16 A Good morning.
17 Q Tell us what you do for a living.
18 A I am an attorney.
19 Q What kind of law do you practice?
20 A Mostly real estate and corporate law.
21 Q Who do you work for?
22 A My own practice, law practice.
23 Q How long have you had your own law practice?
24 A Since 1992.
25 Q Do other people work for you in your business?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
778
Adler-direct/Scott
1 A I have one assistant, yes.
2 Q How long have you had your assistant?
3 A Since last July.
4 Q So, you have had your assistant about six or seven
5 months?
6 A That's correct.
7 Q Now, where do you work?
8 A I work out of my apartment, which is at 2250
9 Broadway. I have my office in the apartment, in
10 Manhattan.
11 Q And what kind of services do you provide?
12 A Well, I do real estate transactions for clients, I do
13 some corporate work for clients. That's essentially it.
14 Q What services do you perform for them?
15 A I do contracts, I do closings, I work with mortgage
16 lenders. I draft documents, negotiate agreements, typical
17 commercial law matters.
18 Q Do you know Martin Reffsin?
19 A Yes, I do.
20 Q How do you know him?
21 A Before I had my own practice, from 1990 to 1992, I
22 worked for a real estate developer in Long Island City,
23 named Louis Evangelista.
24 THE COURT: How do you spell Louis?
25 THE WITNESS: L O U I S; Evangelista.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
779
Adler-direct/Scott
1 E V A N G E L I S T A. I was his in-house counsel for
2 that two-year period. And Mr. Reffsin was his accountant,
3 and spent a lot of time working in the office. And we
4 worked together on many matters.
5 Q Do you know Bruce Gordon?
6 A I did some work, legal work for him several years
7 ago, and I met him once, yes.
8 Q And when was that legal work performed?
9 A In early 1994.
10 Q Now, what -- who gave you that assignment in 1994?
11 A Mr. Reffsin contacted me and asked me to prepare
12 legal documents.
13 Q What specifically was your assignment?
14 A I had to -- he described Who's Who business, the
15 Who's Who business, and the investment by
Mr. Gordon's
16 sister and brother-in-law in it, and said the investments
17 had been made several years before, but they had never
18 documented the investment transaction. So, it was my job
19 to prepare some corporate minutes and some promissory
20 notes.
21 Q What did you do with these documents after you
22 drafted them?
23 A I forwarded them to Mr. Reffsin.
24 Q You say this was in March of 1994?
25 A Approximately.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
780
Adler-direct/Scott
1 Q Now, I am showing you Government's Exhibit 671.
2 Do you recognize that?
3 (Handed to the witness.)
4 A Yes. That's a copy of the fax that I sent to
5 Mr. Reffsin transmitting drafts of the documents I had
6 prepared.
7 MS. SCOTT: I offer Government's Exhibit 671.
8 THE COURT: I wish you would designate it for
9 identification. We have hundreds of documents. At least
10 for my edification, I would appreciate each lawyer saying
11 if it is not in evidence yet, for identification.
12 MS. SCOTT: I offer what is now as
13 Government's Exhibit 671 for Identification, I offer into
14 evidence.
15 THE COURT: Any objection?
16 MR. WALLENSTEIN: No, your Honor.
17 MR. TRABULUS: No, your Honor.
18 THE COURT: Government's Exhibit 671 in
19 evidence.
20 (Government's Exhibit 671 received in evidence.)
21 MS. SCOTT: Now I request permission to publish
22 it to the jury.
23 THE COURT: Yes.
24 (Whereupon, the exhibit/exhibits were published
25 to the jury.)
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
781
Adler-direct/Scott
1 THE COURT: What is the date on that exhibit?
2 THE WITNESS: The date is March 30th, 1994.
3 Q Going through that exhibit, Mr. Adler, can you tell
4 the jury what each page is.
5 A The cover sheet is my fax cover sheet with my heading
6 at the top.
7 The next page, the next two-pages are a draft of
8 promissory, a promissory note.
9 The two pages after that are the draft of the
10 different promissory note.
11 Q Any date on the two promissory notes?
12 A Yes, the first one is dated January 31st, 1993. And
13 the second one is dated May 31st, 1993.
14 Q Please continue.
15 A Then there is a draft of a letter from Joyce Grossman
16 to Bruce Gordon, one page.
17 There is a one-page waiver of notice of special
18 meeting of the board of directors of Who's Who Worldwide
19 Registry ink.
20 Q Can you tell us the date on that document?
21 A The date on that is January 3rd, 1990.
22 Q I am sorry, the document just prior to that, what was
23 that?
24 A That was a promissory note -- no, I am sorry, it is a
25 letter from Joyce Grossman to Bruce Gordon dated January
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
782
Adler-direct/Scott
1 10th, 1990.
2 Q And following that --
3 A The waiver of notice of the minutes of special
4 meeting.
5 Then there is the minutes of special meeting of
6 the board of directors of Who's Who Worldwide Registry
7 ink.
8 Q Is there a date on that document?
9 A It says that the meeting was held January 9, 1990.
10 Then following that there is a waiver of notice
11 of special meeting of the board of directors of Publishing
12 Ventures ink, with the date of January 13th, 1993; and the
13 minutes of that meeting, that's the next page, a one-page
14 document stating the meeting was to have taken place on
15 January 31st, 1993.
16 Following that is a one-page waiver of notice --
17 THE COURT: You have to slow down a little bit,
18 Mr. Adler.
19 THE WITNESS: Sorry.
20 Following that is a one-page waiver of notice of
21 special meeting of board of directors of Sterling Who's
22 Who, Inc. the date of that notice -- of that waiver, is
23 May 10th, 1993.
24 Following that there is a one-page document,
25 minutes of special meeting of board of directors of
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
783
Adler-direct/Scott
1 Sterling Who's Who ink, with the date of May 14th, 19,
2 1993.
3 And that's that.
4 Q Thank you.
5 Now, you say that the request for -- the request
6 you received from Mr. Reffsin to create these documents
7 came in early 1994; is that correct?
8 A That's correct.
9 Q How were you paid for your service?
10 A I was given a check for $1,500 by Mr. Reffsin after I
11 completed my work.
12 Q And I am showing you Government's Exhibit 671-A for
13 Identification.
14 (Handed to the witness.)
15 A This is a photocopy of a deposit slip, in which I
16 deposited the $1,500 into my checking account.
17 MS. SCOTT: I offer Government's Exhibit 671-A.
18 THE COURT: Any objection?
19 MR. TRABULUS: No objection.
20 MR. WALLENSTEIN: No objection.
21 THE COURT: Government's Exhibit 671-A, or Abel,
22 in evidence.
23 (Government's Exhibit 671-A received in
24 evidence.)
25 Q How do you know that that deposit slip represents a
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
784
Adler-direct/Scott
1 deposit for a payment you received from Mr. Reffsin?
2 A Because I wrote it in my own handwriting, $1,500,
3 M. Reffsin, legal fee, which is my typical way of dealing
4 with deposits. I write the amount of the deposit -- I
5 mean I write the source of the deposit right on the
6 deposit slip, so I have it for my own reference.
7 Q Now, Mr. Adler, can you tell us whether the check for
8 $1,500 was a check issued -- withdrawn.
9 Do you remember who made out the check for $1,500
10 that you received?
11 A Well, I don't have a specific memory of the check,
12 but I am fairly careful and accurate in entering my
13 deposits. And if I wrote M. Reffsin legal fee, it is
14 because I would have gotten the check from Mr. Reffsin.
15 If it was someone else I would have written their name on
16 it.
17 Q And the dates that you have read off the documents
18 that you created for Mr. Reffsin and Mr. Gordon, can you
19 tell us who told you those dates to place on the
20 documents?
21 A Obviously those dates are substantially earlier than
22 I prepared them. The reason I did that is at
23 Mr. Reffsin's request. He indicated the transactions had
24 taken place in those early years. And as is fairly
25 typical when you have a transaction within a family on an
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
785
Adler-direct/Scott
1 informal basis, they often could not generate the
2 paperwork at the time the transaction is to take place.
3 So I was asked as I have been asked to do in other places
4 is to prepare the documents as of the time the
5 transactions I was told took place.
6 Q Were you told the exact dates that the transactions
7 occurred?
8 A I probably wasn't. I was probably told the month in
9 general. I notice going through this again, I made the
10 date of the notice of the meeting several days before the
11 day of the minutes of the meeting, which would just show
12 that the notice came before the time of the minutes, which
13 is a standard practice, to show that it was done in proper
14 order.
15 MS. SCOTT: Thank you.
16 I have no further questions.
17
18 CROSS-EXAMINATION
19 BY MR. TRABULUS:
20 Q Good morning, or perhaps good afternoon, or right at
21 the cusp there, Mr. Adler.
22 I am Norman Trabulus. I am Mr. Gordon's lawyer.
23 I think you indicated that you met Mr. Gordon
24 only once; is that correct?
25 A That is correct.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
786
Adler-cross/Trabulus
1 Q Is that was at the offices of Who's Who?
2 A Yes, it was.
3 Q Okay.
4 Was that after the things you have just been
5 testifying about?
6 A Yes. It was after, Mister --
7 Q You don't need to answer any further.
8 At the time that all these things that you
9 testified about happened, you had not had a meeting with
10 Mr. Gordon?
11 A That is correct.
12 Q And had you spoken to Mr. Gordon before meeting him
13 at that time?
14 A No.
15 Q And so, at the time that everything you are talking
16 about happened, you had never met nor spoken to
17 Mr. Gordon; is that correct?
18 A That is correct.
19 Q And the only thing you ever heard from Mr. Gordon or
20 his business affairs came from Mr. Reffsin; is that
21 correct?
22 A Yes.
23 Q I think you mentioned it is not at all atypical in a
24 business that is owned by family members to have a lack of
25 documentation; is that fair to say?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
787
Adler-cross/Trabulus
1 A Yes, that has been my experience.
2 Q And have there been many times that years after the
3 fact you have put together sets of minutes, corporate
4 minutes of meetings, and so forth?
5 A Yes, it happened many times.
6 Q Nothing improper about that?
7 A Correct, as long as it reflects what took place at
8 the time.
9 Q And your understanding of what took place at the time
10 came from Mr. Reffsin; is that correct?
11 A Yes.
12 Q Not from Mr. Gordon?
13 A That is correct.
14 Q That's the same with regard to promissory notes, you
15 could have a situation where money was lent earlier, and
16 no note written to reflect it, or a note can be written, a
17 term we use as lawyers to memorialize what happened
18 before?
19 A Yes.
20 Q And that's okay?
21 A Yes, that's okay.
22 MR. TRABULUS: No further questions.
23
24
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
788
Adler-cross/Wallenstein
1 CROSS-EXAMINATION
2 BY MR. WALLENSTEIN:
3 Q Good afternoon, Mr. Adler.
4 A Good afternoon.
5 Q I am John Wallenstein, I am Martin Reffsin's lawyer.
6 How long have you known Mr. Reffsin?
7 A I met him in 1990 when I started working for
8 Evangelista.
9 Q And during the period between 1990 and today how many
10 occasions have you had to work with Mr. Reffsin?
11 A Well, I worked extensively with him while we were
12 both employed at Evangelista's office for a two year
13 period. After that time when I left Evangelista, I set up
14 my own law practice. Mr. Reffsin and I were friendly. He
15 indicated he would try to get me legal work from clients
16 that he knew, and he did that on a number of occasions.
17 Q Approximately how many times did he refer legal work
18 to you?
19 A Well, there was this matter. There was at least one
20 other matter I remember, a bottling company. I did some
21 legal work for them. In addition, I handled the purchase
22 of his residence by Mr. Reffsin. I handled that for him.
23 Q When did Mr. Reffsin contact you for the first time
24 with respect to this matter that you are testifying about
25 today?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
789
Adler-cross/Wallenstein
1 A I don't have an exact memory. But since this fax was
2 sent out March 30th, 1994, probably shortly before that.
3 It was a relatively small assignment, and there was not
4 lengthy discussions about it. He told me to prepare, and
5 I would have prepared it.
6 Q Did he tell you specifically what documents to
7 prepare, or did he tell you what transactions had occurred
8 and leave to you what documents were necessary?
9 A No. There was fairly specific instructions as to
10 what was needed. He told me it was a family transaction.
11 They had never created the necessary documents. It was a
12 later date now, but it was necessary. And he asked me to
13 prepare them and describe the transactions.
14 We probably had some discussions back and forth
15 about what would be needed, and then I prepared the
16 documents. They were in draft form.
17 My fax to him at March 30th at the bottom lists
18 what I am transmitting, and it says any comments or
19 questions, implying if they are not correct they have to
20 be revised.
21 Q When did the meeting with Bruce Gordon take place in
22 relation to the fax of March 30th?
23 A It took place afterwards. I remember the work had
24 been completed. Mr. Reffsin said that --
25 Q Mr. Adler, my question is when did the meeting take
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
790
Adler-cross/Wallenstein
1 place.
2 A I am sorry.
3 Q Lawyers make traditionally the worst witnesses.
4 A I am sorry.
5 Q Did you meet with Gordon on one occasion or more than
6 one occasion?
7 A One occasion.
8 Q After March 30th of 1994?
9 A Yes.
10 Q And when Mr. Reffsin first contacted you with respect
11 to this particular document preparation, was that the
12 first time that you became aware of the existence of Who's
13 Who, or did you know about it before then?
14 A It was the first time.
15 Q And how long was your discussion with Mr. Reffsin?
16 A There were probably several phone calls, I don't
17 remember exactly, in which he told me, would have told me
18 what he needed. I might have called back to ask questions
19 as to putting the documents together. So it was a
20 dialogue between us to get the documents in the right
21 form.
22 Q Do you know -- withdrawn.
23 And did he ever tell you that he had any interest
24 in Who's Who, or Publishing Ventures, other than the fact
25 that he was their accountant?
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
791
Adler-cross/Wallenstein
1 A He never told me anything of that sort.
2 Q And did he indicate to you that in fact these
3 meetings that you were memorializing with these documents,
4 did he tell you he was present at any of the meetings?
5 A No, he did not.
6 Q Did he indicate to you in the course of your
7 discussion that the information that he was relaying to
8 you came in fact from Bruce Gordon or other corporate
9 officers?
10 A Yes.
11 Q You indicated you had worked with Mr. Reffsin since
12 about 1990?
13 A That's correct.
14 Q Did Mr. Reffsin indicate to you in the course of your
15 discussions or your preparations of the documents that
16 Gordon was the source of the information that Reffsin was
17 supplying to you?
18 MR. TRABULUS: Your Honor, not an objection, but
19 a limiting instruction, if any such statement was made by
20 Mr. Reffsin as to what Mr. Gordon may or may not have told
21 you, it is not admissible as to the truth against
22 Mr. Gordon.
23 MR. WHITE: Objection to that. I think there is
24 a basis --
25 THE COURT: Overruled, based on whatever the
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
792
Adler-cross/Wallenstein
1 conspiracy count is.
2 Q Can you answer that?
3 A What was the question again?
4 MR. WALLENSTEIN: May the reporter read back the
5 questions?
6 THE COURT: Yes.
7 (Whereupon, the court reporter reads the
8 requested material.)
9 A The answer is yes.
10 Q Thank you, Mr. Adler.
11 Now, it is correct, is it not, that memorializing
12 prior transactions even years later is a standard practice
13 in corporate law?
14 A Yes, particularly in closely held situations,
15 where -- such as this, where family members are involved.
16 Q Would you say it is fairly typical in your experience
17 that family members who own corporations together don't
18 bother with the niceties of documentation until it becomes
19 necessary at some point?
20 A That's very common, yes.
21 Q And would it also be common to say that approximately
22 at this time, the end of March, 1994, there was a
23 bankruptcy proceeding and there was documents necessary
24 for that?
25 A
I was unaware of any bankruptcy proceeding mentioned
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
793
Adler-cross/Wallenstein
1 here.
2 Q Did you at sometime learn that there was a bankruptcy
3 proceeding?
4 A This morning.
5 Q Did you perform any other services with respect to
6 this particular matter at or around March or April of
7 1994?
8 A Not that I remember. There was a number of
9 documents. I got paid a $1,500 fee for it. It is
10 possible that there may have been other documents, but I
11 do not remember.
12 Q The $1,500 fee that you testified on direct, your
13 deposit slip indicates that the source of the check was
14 Mr. Reffsin; is that right?
15 A That's right.
16 Q And the check itself is not here, and you have not
17 seen it, I presume, since sometime in 1994; is that
18 correct?
19 A That is correct.
20 Q And is it fair to say that you do not know recollect
21 as to whether it was Mr. Reffsin's check or some other
22 entity?
23 A Well, I don't have the exact memory, but given my
24 practice I would have put on my deposit slip the source of
25 the check.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
794
Adler-cross/Wallenstein
1 Q Well, the legal services that you performed with
2 respect to these documents were not for Mr. Reffsin
3 personally, or any entity that he had an interest in; is
4 that correct?
5 A To my knowledge, that's correct.
6 Q In fact, you were performing the services on behalf
7 of Who's Who Worldwide and Publishing Ventures; is that
8 correct?
9 A Well, those entities, or Mr. Gordon, for that
10 business group.
11 Q You knew it was Gordon's -- Gordon's businesses as
12 opposed to Reffsin's businesses; is that right?
13 A Yes, I knew that.
14 Q Is it possible that the reason you received a check
15 from Mr. Reffsin was that your fee was lumped into some
16 other monies that Mr. Reffsin had received from
17 Mr. Gordon, so Mr. Reffsin cut you his check out of
18 whatever proceeds he received from Mr. Gordon or his
19 entities?
20 A It is certainly possible.
21 I had no contact with Mr. Gordon. I wanted to be
22 paid, and discussed my fee with Mr. Reffsin, and we
23 probably reached the number of 1500. He forwarded a check
24 to me, which was not unusual to me, because he was the
25 only person I had dealt with.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
795
Adler-cross/Wallenstein
1 Q Now, you don't know in fact whether the source of
2 those funds was Mr. Reffsin's personal funds or some
one
3 else?
4 A I don't know as a fact.
5 Q Now, you indicated that you had worked with
6 Mr. Reffsin since 1990 on several different matters, and
7 rather extensively the early 90's; is that correct?
8 A Yes, in connection with my employment by Louis
9 Evangelista.
10 Q During the course of that time did you have the
11 opportunity to observe Mr. Reffsin and the manner he
12 worked?
13 A Yes, I did.
14 Q Did you ever have the feeling that Mr. Reffsin was
15 other than 100 percent honest with and/or his clients?
16 A No, I did not.
17 Q Did you ever get the feeling or any kind of
18 indication from any source that Mr. Reffsin was doing
19 anything underhanded or dishonest?
20 A No.
21 Q Did you ever discuss with Mr. Reffsin at any time the
22 manner in which he practiced vis a vis the laws or the
23 rules, or the regulations of the Internal Revenue Service,
24 or the practices of certified public accountants?
25 A Yes, I did. He and I were in a similar situation.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
796
Adler-cross/Wallenstein
1 We were both working for a real estate developer that was
2 failing, having a lot of legal problems and accounting
3 problems. We had to deal with it. We were conscious of
4 the fact that we had to keep ourselves clean. It was an
5 important issue to both of us. We were both very
6 concerned about our moral standards and our professional
7 reputations.
8 Q Did you ever have the occasion to discuss
9 Mr. Reffsin's reputation with anyone else?
10 A No.
11 Q Was your opinion, however based on your personal
12 observation of Mr. Reffsin and your discussions with him,
13 that everything he did was open and aboveboard and in
14 compliance with the law; is that correct?
15 A That's correct.
16 MR. WALLENSTEIN: Thank you, Mr. Adler.
17 No further questions, your Honor.
18 THE COURT: Anything else?
19 MS. SCOTT: Yes.
20
21 REDIRECT EXAMINATION
22 BY MS. SCOTT:
23 Q Now, Mr. Adler, in these documents in which you
24 memorialized meetings and agreements, was it represented
25 to you by Mr. Reffsin that these meetings and agreements
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
797
Adler-redirect/Scott
1 had actually occurred?
2 A Not necessarily, because you have this informal
3 intrafamily situation, people don't normally sit down and
4 hold a board meeting when two or three family members own
5 a corporation. They don't actually go through those
6 formalities. People don't act that way in real life.
7 Nevertheless, that's the way the world needs to
8 see the documents, so you have waivers of notice of
9 meeting, you act like a meeting took place. The important
10 thing is the substance of what took place.
11 Q And was it your understanding from what Mr. Reffsin
12 told you that the substance of the agreements was
13 something that had actually occurred between the parties?
14 A Yes, that reflected the economic arrangements that
15 the family members had made.
16 Q And, so, when you drafted the documents, you believe
17 that these documents accurately represented the agreement
18 that existed between all the interested parties; is that
19 correct?
20 A Yes.
21 Q You believed that because of what Mr. Reffsin told
22 you; is that correct?
23 A That is correct.
24 Q Now, you mentioned that you would have clarified on
25 your deposit slip the source of the check used to pay you;
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
798
Adler-redirect/Scott
1 is that correct?
2 A I would have indicated it, yes.
3 Q Now, by the source of the check, do you mean the
4 payor of the check?
5 A Yes. The printed name at the top of the check.
6 MS. SCOTT: Thank you. No further questions.
7 MR. TRABULUS: Very briefly.
8
9 RECROSS-EXAMINATION
10 BY MR. TRABULUS:
11 Q Mr. Adler, in the course of performing, drafting
12 contracts and performing legal services for business type
13 clients, have you ever had an occasion to draft a document
14 which reflects after the fact an agreement that something
15 occurred as of a certain date?
16 A I don't understand the question.
17 Q I will rephrase the question, I am sorry.
18 Is it fair to say on certain occasions people in
19 business relations enter into business agreements as of
20 certain dates?
21 A Yes.
22 Q And that would be an agreement that would be entered
23 into after the date that it is as of? Is that fair to
24 say?
25 A You are touching a touchy subject here, you know,
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
799
Adler-recross/Trabulus
1 lawyers being asked -- I am going beyond exactly what you
2 asked me.
3 Q I don't want you to go beyond what I asked you, but
4 it can be lawful to enter into an agreement whereby
5 something is kind of changed retroactively? In other
6 words, you agree as of a certain date in the past the
7 relations between you were a certain way? Is my question
8 too general?
9 A It is too general and touching on a very difficult
10 subject. The idea is that that would have had to have
11 been the arrangement as of the date you made it and it
12 would not have changed since, that's the important thing.
13 Otherwise the lawyer is getting into a very difficult
14 area.
15 Q Can you have people between themselves agree,
16 clients, or parties to an agreement, between themselves
17 agree that as between themselves they have agreed to
18 change the relation as it originally existed, but make the
19 change as of an effective date? Can that be done?
20 A Certainly parties can make an arrangement and change
21 the arrangements later. It becomes a real question for
22 the lawyer, if I had any sense that that was taking place
23 I would have to inquire further and probably speak to the
24 client itself to see if that was what was actually going
25 on.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
800
Adler-recross/Trabulus
1 Q I am not suggesting that that is not what you were
2 told in the first instance, but that can be done --
3 A Certainly people can change relationships, that's the
4 normal business relationships.
5 Q There -- it is reflected by a document which is
6 backdated in your experience?
7 A Not in my experience. That would be improper.
8 Q Would it be improper if the people agreed that they
9 would agree that their relations would have been different
10 as of an earlier date?
11 A You are getting into something that as of an attorney
12 I would have to very carefully inquire. I would probably
13 want to create a document pass of the original date, and
14 at a later date create a different document showing a
15 change was made if in fact their relationship had changed.
16 Q When you say this is a difficult area for an
17 attorney, you are saying some fine lines are here?
18 A I am saying some important ethics issues arises and a
19 lawyer has to be very sensitive to that.
20 Q I am not suggesting in any way, shape or form you
21 crossed any line you shouldn't have had.
22 Would it be fair to say in your experience
23 clients may not be aware of some of the niceties that a
24 lawyer is aware of?
25 A Yes, one of the functions of a lawyer is to raise
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
801
Adler-recross/Wallenstein
1 these for clients.
2 MR. TRABULUS: Thank you.
3
4 RECROSS-EXAMINATION
5 BY MR. WALLENSTEIN:
6 Q Mr. Adler, in response to Ms. Scott's questions on
7 redirect, you indicated that the substance of the
8 documents which you prepared came from Mr. Reffsin; is
9 that correct?
10 A The information was given to me by Mr. Reffsin;
11 that's correct.
12 Q Is it also fair to say that Mr. Reffsin indicated to
13 you or that you knew at the time that the information that
14 Mr. Reffsin was relaying to you came to him through
15 Mr. Gordon?
16 MR. TRABULUS: Objection to form, your Honor.
17 THE COURT: Overruled.
18 A Yes. The information -- Mr. Reffsin did indicate to
19 me that the substantive information had been given to him
20 by Mr. Gordon.
21 MR. WALLENSTEIN: Thank you very much.
22 No further questions.
23 THE COURT: Anything else?
24 MR. TRABULUS: Just one question.
25
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
802
Adler-recross/Trabulus
1 FURTHER RECROSS-EXAMINATION
2 BY MR. TRABULUS:
3 Q The question that Mr. Wallenstein just asked you,
4 when he said -- you said you were told or knew at the time
5 that the information came from Mr. Gordon, is it fair to
6 say you were told?
7 A I was told. I had no direct knowledge because I had
8 not spoken to Mr. Gordon.
9 THE COURT: Anything else?
10 MR. WALLENSTEIN: No, your Honor.
11 THE COURT: You may step down.
12 (Whereupon, at this time the witness left the
13 witness stand.)
14 THE COURT: Please call your next witness.
15 MR. WHITE: Your Honor, the government calls
16 Johan Strom.
17 THE COURT: Step up and raise your right hand.
18
19 J O H A N S T R O M ,
20 called as a witness, having been first
21 duly sworn, was examined and testified
22 as follows:
23
24 THE COURT: Please be seated.
25 State your full name and spell your name.
HARRY RAPAPORT, CSR, CP, CM OFFICIAL COURT REPORTER
803
1 THE WITNESS: Johan Strom. J O H A N is the
2 first name, Strom, S T R O M is the last name.
3 THE COURT: You have to speak up. Pull the
4 microphone closer to you.
5 THE WITNESS: Johan Strom, J O H A N. Last name
6 Strom, S T R O M.
7 THE COURT: You may proceed.
8 MR. WHITE: Thank you, your Honor.
9
10 DIRECT EXAMINATION
11 BY MR. WHITE:
12 Q Mr. Strom, can you tell us how you are employed?
13 A Concierge at the front desk at the building 250 East
14 54th Street.
15 Q And the name of that building the, Mondrian,
16 M O N D R I A N?
17 THE COURT: What is it?
18 MR. WHITE: M O N D R I A N.
19 Q How long have you been the concierge there?
20 A The opening of the building, 1993.
21 Q What year?
22 A 1993.
23 Q Tell us what your duties are as concierge?
24 A We make sure anybody coming in the building are the
25 people living in the building or their guests. We take
HARRY RAPAPORT, CSR, CP,
CM OFFICIAL COURT REPORTER
804
Strom-direct/White
1 care of their dry cleaning, packaging, any service we can
2 do for the tenant in the building.
3 Q What are your responsibilities with respect to dry
4 cleaning and packages?
5 A People come, we log it and accept it. The tenant
6 comes into the building, we ask them if