Rigases Rest Their Case

Adelphia Communications Corp. founder John Rigas and son Michael decided to rest their case last week without taking the witness stand.

Former Adelphia assistant treasurer Michael Mulcahey chose to address the jury, taking the witness stand last Wednesday (June 2). His direct examination by attorney Mark Mahoney is scheduled to resume Monday.

Accused of looting billions from Adelphia, the Rigases — former chairman and CEO John, former executive vice president Michael and former CFO Timothy, who did not rest his case — and Mulcahey have been on trial since March, facing 24 counts of fraud and conspiracy.

Peter Fleming, the attorney for John Rigas, told U.S. District Court judge Leonard Sand last Wednesday that Rigas rested his case but reserved the right to call additional witnesses “designated as joint defense witnesses” later in the trial.

Fleming called a character witness to the stand last Monday. David Acker, the CEO of Charles Cole Memorial Hospital, based near Adelphia’s former headquarters in Coudersport, Pa., told jurors John Rigas “is one of the finest men I’ve ever met.”

Prosecutors elicited some damaging testimony from Acker during his cross-examination. Acker testified Rigas allowed him and his wife to stay at a Rigas family-owned condominium in Cancun, Mexico, for two nights in 1998.

Prosecutors told jurors that Rigas billed Adelphia $4,858 for a 14-night stay at the condominium, even though Acker used the condo for two nights, according to Bloomberg News.

Mulcahey’s attorney spent much of the day on June 2 painting a sympathetic picture of Mulcahey, tracking his small-town roots and his rise up the ranks at Adelphia. He joined the MSO in 1991 as director of investor relations.

Mulcahey described to jurors how he was a blood donor; how he and his wife hosted exchange students and city children from New York at their rural home; and how he had once worked part-time as a housepainter to help make ends meet.

Moving on to his work at Adelphia, Mulcahey told jurors he helped implement a “cash management system” at Adelphia in 2001, which prosecutors have alleged the Rigas family used to steal money from the company.

As to the CMS system, Judge Sand gave jurors instructions that could benefit Mulcahey and the Rigases.

“The government does not contend in this case that there is anything inherently wrong or unlawful with a cash-management system, with co-borrowing, or co-mingling,” Sand told jurors. He also said: “The government does contend that the alleged failures to disclose with respect to those was unlawful.”

Closing arguments in the trial could begin as early as this week.