Prosecutors Trip Up in Dallas Political Bribery Case

DALLAS (CN) – Federal prosecutors Tuesday rested their bribery case against Dallas County Commissioner John Wiley Price after the judge angrily chewed them out for endangering their case by failing to deliver evidence to the defense on three occasions.

For eight weeks, prosecutors have portrayed Price, 66, as a self-interested crook who took more than $950,000 in cash, cars and real estate from political consultant Kathy Nealy in exchange for support for her clients, and more than $200,000 in cash from a clothing store operated by Price’s assistant Dapheny Fain and an art gallery operated by his friend Karen Manning. Nealy will be tried separately; Fain is being tried with Price.

Price is accused of hiding the bribes and failing to report them on state-mandated financial disclosure statements or in his federal tax returns.

Price was charged in July 2014 with conspiracy to commit bribery concerning a local government receiving federal benefits, conspiracy to defraud the IRS, six counts of deprivation of honest services by mail fraud, and three counts of subscribing to a false and fraudulent income tax return.

For the first several weeks of trial, prosecutors called a steady line of FBI agents, Price’s acquaintances, county contract bidders and fellow county commissioners to build their case to the jury.

They stumbled badly last week when defense attorneys began asking about the missing evidence. The latest batch of missing documents pertains to a suite Nealy held at the American Airlines Center and a condominium unit she had nearby.

Assistant U.S. Attorneys Walt Junker and Nicholas Bunch have apologized for the errors, but say the missing evidence was not pertinent to the case.

U.S. District Judge Barbara Lynn was not swayed Tuesday, lamenting her loss of confidence in prosecutors’ ability to turn over evidence to the defense, calling the failure “terribly inappropriate and very disappointing.”

Lynn wanted their boss, U.S. Attorney for the Northern District of Texas John Parker, to explain the errors to her in court. Parker is in Washington, D.C. this week, so his deputy, Assistant U.S. Attorney Chad Meacham, bore the brunt of her frustration. He told the judge his office has “fallen short” on the mistakes.

“We take our discovery obligations very seriously,” he said.

Lynn swatted down prosecutor Junker when he said the errors resulted from the large amount of evidence from the six-year investigation, telling him that that is not the defense’s problem.

“The scope of this investigation and prosecution is of the government’s making, not the defense’s,” she said. “Difficult as it is, the government is obligated to staff the case.”

Price’s attorney, Shirley Baccus-Lobel of Dallas, disagreed with the statement that the missing evidence had no impact on the defense. She said the documents show Price participated in construction work at the condominium and support their argument that the two friends did things for one another.

Price moved for acquittal Tuesday, repeating the argument that prosecutors have failed to show that the financial transactions between Nealy and Price were bribes.

The defense has had to recall certain prosecution witnesses since last week, as they go through the missing evidence.
Fain also moved for acquittal Tuesday. Her attorney, Thomas W. Mills with Mills Williams in Dallas, told the judge he believes there has been “prosecutorial malfeasance and negligence” in the bungling of evidence.

He said there is no proof that “we are going to get what we should get.”

Mills said prosecutors failed to prove Price and Fain “worked together to do anything illegal” and failed to prove she made false statements to law enforcement.

“It wholly failed to provide sufficient evidence of a conspiracy: it failed to put on evidence that any income was actually received by Commissioner Price from Ms. Fain, which negates the argument of concealment and the requirement that such income should have been disclosed on Commissioner Price’s tax returns,” a 12-page memorandum in support of the motion for acquittal states. “The prosecution put on no evidence to prove that Ms. Fain possessed the criminal intent necessary to enter into and carry out a conspiracy to defraud the I.R.S. with Commissioner Price or that she did any overt acts to further such conspiracy.

Fain gave her opening statement Tuesday. Her attorney Marlo Cadeddu disputed prosecutors’ claims that Price was paid bribes by the clothing store, Man Made Sales. She said Price loaned Fain more money than she ever paid back to him, making the store a “burden” on him, not a benefit.
The government’s star witness, political consultant Christian Campbell, testified in March that Price would nudge companies who wanted his support on their county contract bids to hire Nealy, who then passed bribes on to him.

Campbell was indicted with Price, Nealy and Fain and took a deal, pleading guilty to one count of bribery in 2015.

Campbell also testified in 2016 against former BearingPoint executive Helene Tantillo, who was sentenced to six months in federal prison by an Austin jury. She was convicted of making false statements to the FBI, that a $10,000 increase in consulting fees paid to Campbell was going to charity. Prosecutors in that case said the money went to Nealy in the company’s bid on a county records digitization contract in 2004.

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