A federal jury deadlocked Friday on securities and bank fraud charges against Michael J. Rigas, the former chief operations officer of Adelphia Communications Corp., ending the trial of a case that federal prosecutors said involved some of the most egregious misuse of a public company's money in recent memory.
Rigas, 50, was acquitted Thursday of conspiracy and wire fraud in a partial verdict that included the convictions of his father, Adelphia founder John J. Rigas, and his brother Timothy J. Rigas on multiple charges of fraud and looting the cable company to fund personal expenses.
Jurors told U.S. District Judge Leonard B. Sand in a note Friday that they were unable to agree on 15 securities fraud and two bank fraud charges against Michael Rigas, despite two weeks of deliberations.
Sand then brought the jurors into the courtroom and told them to go home. "Thank you. God bless. You're discharged," he said.
John Rigas, the former chief executive, and Timothy Rigas, the former chief financial officer, were convicted of conspiracy, bank fraud and wire fraud. A fourth former Adelphia executive, Michael C. Mulcahey, was acquitted on all charges.
The Rigas case is apparently not over. U.S. Attorney David N. Kelley said his office plans to retry the case against Michael Rigas. "We're going to go forward," he said, declining to comment on the jury's decision.
Michael Rigas was silent as he exited the Manhattan courthouse. His attorney, Andrew J. Levander, said the deadlocked jury "was a good result for us, but unfortunately the government may retry the case."
During the trial, which lasted more than four months, prosecutors alleged that the Rigases siphoned off $100 million to fund personal extravagances, hid $2.3 billion in debt and systematically deceived investors about Adelphia's subscriber growth and its bottom line. The firm, the fifth-largest cable concern in the United States, sought bankruptcy protection in 2002.
Sand has scheduled a Sept. 21 hearing to discuss sentencing issues for Timothy, 47, and John Rigas, 79, and to set a new trial date for Michael Rigas.
All three cases have been complicated by a recent U.S. Supreme Court decision that calls into question the way the federal sentencing guidelines would apply to this and other cases. Without the Supreme Court decision, both John and Timothy Rigas would probably have faced two decades in prison, legal experts said, but now it is not clear how much time they might receive. The most serious charge they were convicted of, bank fraud, carries a maximum of 30 years in prison, and none of the counts are subject to mandatory minimums.
During the trial, the government built an extensive case against John and Timothy Rigas, but offered less evidence tying Michael Rigas and Mulcahey to the alleged misdeeds. While John and Timothy routinely billed the company for expenses including golfing trips, multiple cars, condominium fees and a masseuse, Michael reimbursed Adelphia for personal expenses, according to witnesses and evidence. The government's star witness, former finance vice president James R. Brown, described multiple conversations with John and Timothy Rigas about allegedly fraudulent filings and accounting tricks, but had little to say about Michael Rigas.
The jurors, who departed the courthouse together, declined to comment on their decisions, except for one woman who declined to give her name. "I don't feel bad for the Rigases," she said.
Elizabeth Carballo, who was a juror until she broke her ankle and was dismissed, said she was surprised the panel got hung up on Michael Rigas. "I thought there wasn't enough evidence" to convict him, she said.
Of John Rigas, who has prostate cancer and sometimes seemed confused during the trial, Carballo said, "He's a sick man and you feel for sick people, [but] the witnesses didn't help him in that situation."
Staff writer Lauren Bayne Anderson and staff researcher Richard Drezen contributed to this report.