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US Tyco Corp. Corruption Case Ends in Mistrial - 2004-04-02

A judge has declared a mistrial in the corruption trial of two former executives of manufacturing conglomerate, Tyco International. The trial ended on the twelfth day of jury deliberations.

New York State Supreme Court Justice Michael Obus, who oversaw the six-month trial, said he had no choice but to declare a mistrial, because of the intense outside pressure on one of the jurors.

The mistrial is a setback for prosecutors and raises the possibility of a retrial of Tyco's former Chief Executive Officer Dennis Kozlowski and former Chief Financial Officer Mark Swartz. They are accused of looting the company of $600 million.

Mr. Kozlowski's attorney, Stephen Kaufman, told reporters his client was disappointed with the turn of events. "We are disappointed because of events that occurred outside the courtroom that this case did not reach verdict," he said.

New York University law professor Seth Lipner says a retrial is a virtual certainty. He says if this case is retried, prosecutors have the advantage.

"In some ways I think the prosecution made some mistakes early on in this case. And I think if they re-did it, they would have an advantage in they're unlikely to repeat those mistakes," he said. "So I think that the chance to do it again, often favors the prosecution especially in a case like this where the evidence seems overwhelming."

Signs the jury deliberations were breaking down surfaced last week. Notes from the jury to the judge indicated that one juror was at odds with the rest on a verdict. The trial was thrown into further turmoil when a juror, identified as juror number four, was reported to have flashed an "OK" hand gesture towards the defense in the courtroom.

Defense lawyers then asked for a mistrial, saying the juror was being pressured by the media and possibly by other jurors to change her position. Media reports say the judge's decision to declare a mistrial was largely dependent on a threatening or coercive letter that this juror was said to have received recently.

The trial against Mr. Kozlowski and Mr. Swartz comes amid a string of high-profile corporate corruption cases. Home design businesswoman Martha Stewart and her broker were convicted last month of conspiracy and obstruction of justice for her sale of stock in biotechnology firm, Imclone. Recently, federal prosecutors have brought criminal charges against former executives of communications company, Worldcom and energy trading firm, Enron.

Professor Lipner from New York University says Friday's mistrial ruling will not have much effect on these other corruption cases because they filed in federal court, instead of state court such Tyco's.

"Most of those cases are brought in federal rather than state court. And for a number of reasons the government in federal court has a greater advantage than prosecutors in state court," he said. "State law tends to not be as condemning of this kind of behavior. And the state prosecutors sometimes lack the resources that federal prosecutors have."

The judge in the Tyco trial has set a hearing for next month for lawyers from both sides to meet for discussions on the next step.