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Men with briefcases. REUTERS Mike Segar

Judge orders new trial for ex-Jenkens lawyers

6/4/2012 COMMENTS (0)

June 4 (Reuters) - Two attorneys with the defunct law firm Jenkens & Gilchrist convicted last year of criminal tax evasion won the right to a new trial on Monday after a judge held that the verdict had been tainted by a juror who lied during jury selection.

U.S. District Judge William Pauley in Manhattan ordered new trials for former Jenkens partners Paul Daugerdas and Donna Guerin, as well as Denis Field, the former chief executive of accounting firm BDO Seidman.

However, he upheld the conviction of a fourth defendant, former Deutsche Bank broker David Parse, finding that his lawyers suspected the juror, Catherine Conrad, was not who she represented herself to be during jury selection but failed to bring the matter to the court's attention.

"Because 'justice must satisfy the appearance of justice,' courts need to ensure that tainted jury verdicts -- even those reached after long and costly trials -- do not stand," Pauley wrote. "But justice also demands that a defendant having reason to suspect juror misconduct not remain silent in order to secure a risk-free trial."

Pauley said her lies were "breathtaking" and included not disclosing the fact that she had been a lawyer and was subject to disciplinary proceedings.

Chris Gair, a lawyer for Daugerdas at Jenner & Block, said he was "absolutely" pleased by the decision.

A spokeswoman for the U.S. Attorney's Office in Manhattan declined comment. A lawyer for Conrad, Bobbi Sternheim, did not return a call seeking comment.

Daugerdas, once the head of Jenkens & Gilchrist's Chicago office, was convicted in May 2011 on 23 criminal counts of tax evasion and conspiracy, following a trial focused on his role in masterminding a $130 million tax shelter scheme.

The tax shelter investigation helped bring down Jenkens & Gilchrist, which dissolved in 2007 after agreeing to pay a $76 million penalty to the Internal Revenue Service.

'PATHOLOGICAL LIAR'

In a 64-page opinion, Pauley said Conrad made a "calculated, criminal decision to get on the jury that convicted Daugerdas, Guerin, Field and Parse. Pauley said he would have dismissed her had she revealed her suspension from the bar and criminal convictions for shoplifting, among other things. He called Conrad a "pathological liar and utterly untrustworthy."

During a February hearing, Conrad called attorneys "crooks," a statement that Pauley said could "only be understood as reflecting a pre-existing bias against lawyers."

The comment was a direct statement of bias against Daugerdas and the other defendants, Pauley said.

The judge suggested that Conrad's views on lawyers were connected to her own career as an attorney. In 2007, the New York Appellate Division, First Department, suspended Conrad after she failed to cooperate with an investigation into complaints alleging professional misconduct. The Appellate Division modified the suspension in December 2010, after Conrad acknowledged an alcohol problem.

In declining to grant a new trial to Parse, Pauley said that before jury questioning began Parse's lawyers knew that Conrad had been suspended from practice. They did not bring that and other facts about Conrad to the court's attention, Pauley said.

"Through this unfortunate concentration of events, Parse's attorneys permitted Conrad's egregious conduct to infect the largest tax fraud prosecution in U.S. history," Pauley wrote.

The Justice Department had not indicated whether it would pursue a new trial against Daugerdas, Gair said.

Mark Detert, a lawyer for Guerin at Stetler, Duffy & Rotert, said he still needed to review the decision, but "certainly the result is something I'm very pleased with."

Susan Brune, a lawyer for Parse at Brune & Richard, declined comment. A lawyer for Field did not respond to requests for comment.

The case is USA v. Paul Daugerdas et al, U.S. District Court for the Southern District of New York, No. 09-581.

For the prosecution: Nanette Davis, Stanley Okula, Jr, Jason Hernandez and Rachel Kovner of the U.S. Attorney's Office.

For the prosecution: Assistant U.S. Attorneys Jason Hernandez, Stanley Okula and Nanette Davis.

For Conrad: Bobbi Sternheim.

For Daugerdas: Chris Gair, Jenner & Block.

For Guerin: Mark Rotert, Stetler, Duffy & Rotert.

For Field: Alexandra Shapiro of Macht, Shapiro & Isserles and Caroline Rule of Kostelanetz & Fink.

For Parse: Susan Brune, Theresa Trzaskoma and Laura Edelstein of Brune & Richard.

(Reporting By Nate Raymond)

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