Prosecutor Blames Fundraiser

Jury Told Cost of Clinton Event Spiraled Out of Control

LOS ANGELES, May 11 -- David F. Rosen deliberately and illegally underreported the costs of a star-studded Hollywood fundraiser for Hillary Rodham Clinton's 2000 Senate campaign, federal prosecutors said Wednesday at Rosen's trial here.

Rosen, who was Clinton's finance director at the time, intentionally underreported the cost of the August 2000 gala by two-thirds, prosecutor Peter R. Zeidenberg told jurors in his opening statement. Rosen did so, the prosecutor said, because as the price of the gala began to spiral out of control, "he knew that there was going to be outrage in the campaign and at headquarters."

Rosen, 40, faces five years in prison on each of three charges related to what prosecutors called an egregious underreporting of the fundraiser, where Cher, Michael Bolton and Melissa Etheridge performed and A-list celebrities such as Brad Pitt and Muhammad Ali attended.

The case centers on Peter Paul, who was a partner of Stan Lee, the comic-book legend. The two ran a short-lived Internet venture, Stan Lee Media, which not only let Rosen use its offices to plan the gala but also agreed to underwrite its cost.

Paul, a convicted felon on bail on an unrelated criminal case in North Carolina, is not expected to testify.

The gala, an unofficial kickoff to the 2000 Democratic National Convention, actually cost more than $1 million, not the $400,000 reported to the Federal Election Commission, Zeidenberg said.

He told jurors Rosen "lied directly to the compliance officer of the Clinton campaign" -- the person responsible for reporting campaign costs and contributions to the FEC -- when questioned why some of the costs were dramatically decreasing. Rosen, the prosecutor said, told the official that Cher had dropped out of the event, lowering costs, including a private jet, that her appearance would have created.

But Cher performed at the event, the prosecutor said, promising to show a video of her singing. "David Rosen knew Cher was going to be there and he also knew the compliance officer in D.C. wasn't going to be there, so how was she going to know the truth?"

Rosen's defense is expected to argue that he had no way of knowing that the figures he reported were wrong because he relied on information given to him by Paul and others.

The case is being closely watched because of possible implications for Clinton, who faces reelection next year and is considered a potential candidate in the 2008 presidential race.

On Monday, Judicial Watch, a conservative group that has dogged Bill Clinton and his wife for years, filed paperwork in Washington urging the Senate ethics committee to investigate the Rosen case. The group complained that Clinton had to have known the gala cost much more than was reported.

But in court here, Zeidenberg's comments would seem to dampen any enthusiasm Clinton's detractors might have in using the case as fodder. "You'll hear no evidence that Hillary Clinton was involved in this in any way, shape or form," he said.

The trial, expected to last two to three weeks, was scheduled to continue Thursday with the defense's opening statement.