Former auditor pleads guilty in bribe case

Published 12:01 am Wednesday, January 16, 2008

OXFORD (AP) — To hear him tell the story, former state Auditor Steve Patterson was unwittingly involved in a judicial bribery conspiracy and by the time he realized what was going on it was too late.

Patterson pleaded guilty Tuesday to conspiring with prominent attorney Richard ‘‘Dickie’’ Scruggs and others in an attempt to bribe a state court judge.

The alleged conspiracy, one of two alleged bribery cases swirling around Scruggs and other politically connected attorneys, was an attempt to secure a favorable ruling in a dispute over $26.5 million in legal fees from Hurricane Katrina litigation.

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Patterson, a heavy set man with wavy salt-and-pepper hair, wore a dark suit and cowboy boots when he appeared before U.S. District Judge Neal Biggers Jr. in federal court for the about 45-minute sentencing hearing.

A 56-year-old Democrat who resigned as state auditor in 1996 after allegedly lying on state documents to avoid paying taxes on a car tag, Patterson asked to address the court.

‘‘I stand here a very blessed man, judge. My family and my church have stood by me through this whole thing,’’ he said.

Patterson was indicted in November along with Scruggs, Scruggs’ son, Zach, and attorneys Timothy Balducci and Sidney Backstrom on charges they conspired to pay north Mississippi Circuit Court Judge Henry Lackey at least $40,000 for a favorable ruling in the fees case. The government said Lackey informed federal authorities of the alleged bribe overture and cooperated with investigators.

‘‘I never set out to corruptly bribe a judge,’’ Patterson told the court. ‘‘However, I do understand that once I joined it and the cat was out of the bag, I was a coconspirator.’’

Patterson pleaded guilty to conspiring to bribe an elected state official. The charge carries a maximum sentence of five years in prison and a $250,000 fine. However, Assistant U.S. Attorney Bob Norman said that in exchange for Patterson’s cooperation, prosecutors will ‘‘take the position that he was a minor participant,’’ which could help him get a lesser sentence.

A message left for Scruggs’ attorney, John Keker, was not immediately returned.

Patterson is the third person to plead guilty and agree to cooperate with authorities since the indictment was made public Nov. 28.

Balducci, who has said he delivered $40,000 in cash to the judge, was the first to take a plea deal. Tuesday’s hearing introduced some new details and names.

It all began when Scruggs and a group of his legal associates known as the Scruggs Katrina Group brokered a deal with State Farm Insurance Cos. and were to split the legal fees.

But the Jackson-based Jones, Funderburg, Sessums, Peterson & Lee firm, which worked on some of the cases, said it was shortchanged. The Jones firm sued.

Around March of last year Scruggs and the others began to discuss ways to influence the outcome of the fee dispute, Norman claimed.

Scruggs knew that Balducci and the judge were friends and Scruggs ‘‘asked Balducci to explore the possibility of corruptly influencing the judge,’’ according court records.

Balducci told the judge he would consider it a ‘‘personal favor if the judge would resolve the lawsuit in favor of Scruggs and the Scruggs firm,’’ Norman told the court.

The judge called the FBI. Then in September, while working undercover, the judge ‘‘tested the coconspirators’ intent by asking for $40,000 in cash,’’ according to court records.

Investigators allegedly intercepted phone calls between Balducci and Patterson in which they discussed the alleged bribe attempt.

After making cash payments, the judge gave Balducci a court order contrived to appear as if the judge was complicit in the scheme, according to Norman and court records.

On Oct. 18, ‘‘Balducci was surveilled entering the Scruggs law firm after leaving Judge Lackey’s chambers. Balducci left the (order from Lackey at Scruggs’ office) and picked up a check for $40,000 together with documents designed to conceal the true nature of the payment,’’ Norman told the court.

The investigation has also expanded to another case. Joey Langston, a Booneville attorney who once represented Scruggs in the Lackey bribery case, pleaded guilty last week to conspiring to influence Hinds County Circuit Judge Bobby DeLaughter to rule in Scruggs’ favor in a case dating back to 1994. DeLaughter has not been charged with any wrongdoing and he denies accepting any type of bribe.

A new name was also introduced in court Tuesday, though prosecutors said P.L. Blake is not charged with a crime. The FBI apparently recorded a telephone call in which Patterson told Balducci that Blake, a longtime Scruggs associate, ‘‘was confident that Scruggs would take care of Patterson and Balducci,’’ Norman said.

Blake has reportedly been associated with Scruggs for years, offering consultation on the multimillion dollar lawsuits in tobacco and asbestos cases that made Scruggs one of the wealthiest plaintiffs lawyers in the country.

No telephone listing could be found for Blake in Mississippi. A message left at the home of a P.L. Blake in Alabama was not immediately returned.