Scrushy Doesn't Testify at His Trial
Defense Rests In Fired CEO's Fraud Case
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Thursday, May 12, 2005
BIRMINGHAM, May 11 -- Richard M. Scrushy's defense rested Wednesday without the fired HealthSouth Corp. chief taking the stand to deny charges that he directed a $2.7 billion fraud at the rehabilitation chain.
After calling more than 20 witnesses to rebut prosecution claims that Scrushy was at the heart of the scheme, defense lawyers told the judge they were finished with their case.
"Your honor, at this time the defense rests," said Scrushy attorney James W. Parkman III.
Prosecutors grinned broadly as Parkman walked away from the podium; so did the defense. Jurors looked at each other with surprised expressions.
U.S. District Judge Karon O. Bowdre excused jurors after the defense announcement, saying prosecutors needed time to discuss possible rebuttal evidence and she needed to confer with both sides.
The decision on whether Scrushy should testify was a calculated gamble either way: Without him taking the stand, jurors won't get to hear his explanation of how he failed to detect a fraud that the defense says went on for years without his knowledge.
But Scrushy could have been hit with a blistering cross-examination, including questions about secretly recorded tapes that prosecutors contend prove he knew of the crime.
In a statement to reporters, Scrushy attorney Donald Watkins said the defense team "unanimously concluded that we are comfortable with where the case stands and there is no need for further witnesses."
Prosecutors contend Scrushy led subordinates in a conspiracy to overstate HealthSouth earnings for seven years to make it appear HealthSouth was meeting Wall Street forecasts. Scrushy made about $249 million from the accounting scam, a prosecution witness testified.
The defense blames the fraud on the 15 former HealthSouth executives who pleaded guilty, including all five finance chiefs who served under Scrushy, the company's primary founder.
The final defense witness compared Scrushy to Michael Jordan and Bill Gates as the defense tried to show the fired chief executive was worth the millions he made while building HealthSouth into an industry leader -- despite the huge fraud he is accused of leading.
Free on $10 million bond, Scrushy is the first chief executive tried under the Sarbanes-Oxley corporate reporting law, passed in 2002 in response to a string of corporate frauds. He also is charged with conspiracy, fraud, money laundering and obstruction of justice.
