A late October trial date for the Gold Country Lenders fraud case is in question, after the defense attorneys for Chief Executive Officer Phil Lester and Chief Financial Officer Susan Laferte file a motion for a continuance.
Superior Court Judge Candace Heidelberger heard extensive arguments from both sides during a hearing Friday, but chose to hear further arguments in chambers and indicated she would issue a ruling next week.
“This case has been dragging on for a very long time,” she said, adding that she did not want to grant a continuance unless it was absolutely necessary, but that she also did not want to run the risk of having a jury verdict reversed due to a claim that she abused her discretion as a judge.
The case, being tried by California Deputy Attorney General Maggy Krell, has been marked by significant delays since Lester and Laferte were arrested in September 2012, then were indicted in mid-January 2013 by a criminal grand jury.
Lester and Laferte allegedly defrauded investors of millions of dollars over a period of eight years.
They each face 61 counts — one count of using a scheme to defraud, 50 counts of offering securities for sale by means of an untrue statement or omission of a material fact and 10 counts of fraud from an elder adult.
Lester’s first court-appointed counsel, Ken Tribby, resigned in July 2013. Heidelberger subsequently appointed Mary Beth Acton to replace Tribby; Laferte is represented by Greg Klein.
Heidelberger had set the trial date for Oct. 28, with motions to be filed by Oct. 3, with a trial readiness conference set for Oct. 10 and jury selection on Oct. 21.
Acton filed a motion to continue the trial on Aug. 25, arguing that she has not had enough time to adequately prepare his defense despite having been appointed — as Heidelberger noted — nearly 14 months ago.
Acton said she received nearly 390,000 pages of additional discovery in February, bringing the total in the case to nearly 865,000 pages.
She alleged in the motion that some items still are missing and she still is compiling a list of what the defense team needs.
Acton also told Heidelberger that there have been issues with expert witnesses, including one expert’s recent surgery.
“The prosecution has had four years to prepare its case,” Acton wrote. “It has support staff and law enforcement to assist. It also has direct and continuous access to all of the original documents … The defense, on the other hand, has not had the pleasure of such amenities.”
Acton also said in her motions that several of the alleged victims have not provided court-ordered tax returns and other financial documents, writing, “the alleged victims are, in part, responsible for any delay.”
The defense also alleged in the motions that “significant” pre-trial publicity might have compromised the defendants’ right to a fair trial.
The motion specifically points to coverage in The Union of the case, including the disclosure of defense costs associated with the trial.
The cost of the trial, and a state Senate bill that would have reimbursed the county for its costs, but which died in committee, was also the subject of a recent front-page article in the San Francisco Chronicle.
“The pre-trial publicity has risen to such a prejudicial level that the defense may have to file for a change of venue,” Acton wrote.
In her opposition to the continuance request, Krell argued the defense has had adequate time to prepare, and noted that nearly all the alleged victims are older than 60 — 14 older than 73 and six older than 80.
“The prosecution of these defendants has been pending for nearly two years,” she wrote. “The delay prejudices the prosecution as the health of our victims deteriorates and the memories of witnesses fade.”
To contact City Editor Liz Kellar, email firstname.lastname@example.org or call 530-477-4229.
“This case has been dragging on for a very long time.”
Superior Court Judge Candace Heidelberger