Blogs & Comment

Drabinsky Final Argument – 9: Messina’s Flip-Flop or Flip-Not?

During the trial there was a great deal of time spent cross examining Maria Messina about her testimony at the US Securities and Exchange Commission. By all accounts, the testimony did not go well. The CFO initially told US regulators she first learned about the fraud sometime in the second quarter of 1997. Her lawyer abruptly ended the interview and the next day she returned to the SEC offices and said she actually knew the company’s financials were materially mis-stated in October of November 1997
The reason for the switch – Livent had sold US$125 million in bonds in October and if Messina had known about the alleged fraud before that sale, she would have opened herself up to much greater regulatory and criminal liabilities.
Defence lawyers say that “flip-flop” proves that Messina is a liar who cannot be trusted.”Messina’s calculated perjury of her knowledge of irregularities is startling enough,” the defence argues. “Her evidence at this trial conpounded that perjury.”
The fact that members of the “Accounting Five” appeared to give evidence in support of that lie, or pleaded the fifth to avoid contradicting Messina shows that the group were co-ordinating their scripted testimony, the defence argues. “It is bad enough that members of the accounting five lied before the SEC of that they refused to testify to protect the lies of Messina. It is bad enough taht the brazenness of their lies were transparently exhibited by the way they changed their stories as they changed jurisdictions. What is worse is the way they were handled and controlling their testimonial attendance. Webster was both paying for and controlling this charade.”
Fair enough. There is just one problem. Prosecutors argue that Messina did finally come clean with the SEC and US Justice Department and finally pled guilty to criminal and civil charges that included the bond offering.