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Ex-Juror Arrested, Forced to Testify in Bid for New Tax Shelter Case Trial

A juror who helped convict four defendants in a 10-year tax shelter scheme said she lied about her background to make herself “more marketable” to serve on the panel.

Catherine Conrad, who was Juror No. 1 in the trial of Paul Daugerdas, a former lawyer at the defunct law firm Jenkens & Gilchrist, and three others, testified in a hearing in Manhattan federal court today that she failed to disclose that she’s an alcoholic and a suspended attorney with numerous arrests for crimes including shoplifting and driving under the influence of alcohol.

Daugerdas and the other defendants convicted in May at the end of a 10-week trial have asked U.S. District Judge William Pauley to order a new trial based on Conrad’s lies and omissions about her past during jury selection. Pauley ordered her arrested this morning after she telephoned a judge’s clerk in Manhattan federal court to say she wasn’t going to obey a court subpoena requiring her to testify today.

“I know I served and I know I did my civic duty,” Conrad told Pauley near the end of her testimony today. “I know my disclosures would definitely not have allowed me to serve as a juror.”

Two-Day Hearing

Pauley is holding a two-day hearing to determine whether to throw out the convictions and order a new trial. Conrad was granted immunity for her testimony today, after invoking her constitutional right not to incriminate herself. Pauley released Conrad at the end of 3 1/2 hours on the stand.

Jurors convicted Daugerdas on more than 20 criminal counts, including conspiracy, multiple counts of tax evasion and attempting to impede the Internal Revenue Service. He faces more than 20 years in prison.

The defendants claim Conrad wouldn’t have been permitted to serve on the jury if she’d told the truth about her background. Her presence on the panel deprived them of a fair trial, they said.

Frequently during her testimony today, Conrad defended the verdict reached by her and the other jurors in the case, which she called “fair and just and unbiased.”

‘Shocking Disregard’

Conrad, who said her primary practice had been personal injury law, was indefinitely suspended from practicing law in 2007 after a panel of judges found her behavior showed “a shocking disregard for the judicial system.”

She told Pauley that part of her motivation to be on the jury was that she missed being in the courtroom and was eager for the intellectual challenge of the case.

During jury selection, Conrad said she lived in Bronxville, New York, in her father’s home, rather than an apartment in the Bronx that defense lawyers claim is her real residence. And Conrad testified today that she lied about owning her home, rather than renting.

“I thought that would seem more juror-marketable,” she said.

The jury also returned guilty verdicts for Denis Field, the former chief executive officer at accounting firm BDO Seidman LLP; Donna Guerin, a Jenkens & Gilchrist lawyer; and David Parse, who worked for Deutsche Bank AG (DBK) unit Alex. Brown Inc. a second former Alex. Brown accountant, Robert Craig Brubaker, was acquitted.

Letter to Prosecutor

Defense lawyers asked for a new trial after Conrad sent a May 25 letter to Assistant U.S. Attorney Stanley Okula praising the prosecution team and discussing the jury’s deliberations.

In the letter, Conrad described herself as “the nerdy person with the ‘Susan Brune’ glasses, I was always head down taking notes!” Susan Brune is a lawyer who represented Parse in the case.

Conrad wrote that she “held out for two days” to convict Parse of a conspiracy charge, then “had to throw in the towel.”

Conrad denied Gair’s suggestion today that the letter to Okula was “flirtatious” and said she hadn’t specially chosen a “Love” stamp for the postage.

Under Gair’s questioning, Conrad said she had stolen a bag of shrimp from a convenience store while drunk. On another occasion she punched a police officer in the stomach as he arrested her for drunk driving. At the time of the Daugerdas trial, there was an outstanding warrant for her arrest issued in Winslow, Arizona, after she was arrested for an altercation with her husband and failed to appear in court.

Conrad didn’t disclose any of those incidents in response to juror questions asking about arrests and convictions, she said.

‘Career Criminal’

Conrad also admitted she didn’t tell the judge that her husband had been convicted of crimes including check fraud, weapons possession, harassment and burglary. He served seven years and seven months in prison for auto theft, Conrad testified.

“Your husband is a career criminal, isn’t he,” Gair asked Conrad.

“So are most attorneys,” she answered, prompting laughter from some in the courtroom.

The case is U.S. v. Daugerdas, 09-CR-581, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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