With just nine months before he goes to trial on criminal charges, R. Allen Stanford wants to hire a new set of criminal defense lawyers, as one of his current lawyers says he has disagreed with Stanford over trial and pre-trial strategy.
Stanford, who was chairman of Stanford Financial Group (SFG) in Houston, filed a motion on March 30 asking Senior U.S. District Judge David Hittner of the Southern District of Texas to substitute Michael Essmyer as Stanford's lead attorney, replacing Kent Schaffer, and to substitute Bob Bennett for George McCall "Mac" Secrest Jr. All are Houston lawyers.
Hittner scheduled a hearing on the motion for today, but he noted in his order setting the hearing that any substitution of counsel will be unconditional, and will not be grounds for a continuance. He wrote in bold print in the order that "[a]ny counsel who anticipates entering this case on behalf of Mr. Stanford must be present."
He also ordered Stanford, who is in federal custody pending trial, to attend the hearing. Stanford has pleaded not guilty to fraud and conspiracy charges related to an alleged conspiracy to defraud investors who bought about $7 billion in certificates of deposit sold through the Stanford International Bank Ltd.
If Hittner approves of the substitution, the Essmyer-Bennett team would be the fifth configuration of criminal defense lawyers representing Stanford since he was indicted in June 2009. Houston's Dick DeGuerin, a partner in DeGuerin & Dickson, represented Stanford at the time he was indicted. But after Hittner allowed DeGuerin out of the case on Sept. 15, 2009, Hittner appointed the Federal Public Defender's Office after determining that Stanford does not have money immediately available to pay for private attorneys. Two days later, Hittner added Schaffer to the team. And after the Federal Public Defender's Office was taken off the team, Hittner in October 2009 added Secrest, a partner in Bennett & Secrest, to the defense team to work with Schaffer.
Now, Schaffer notes, Stanford "has reached an agreement with two new lawyers."
Schaffer, a partner in Bires & Schaffer in Houston, says he and Secrest have had some difficulties over pre-trial and trial strategy with Stanford.
"There were things that he wanted us to do ... that we felt we should not for a number of reasons," Schaffer says.
Essmyer, a partner in Houston's Essmyer, Tritico & Rainey, says Stanford "simply wanted a change of counsel."
While Schaffer declines to elaborate on any sticking points, he acknowledges that change of venue is one issue that was the subject of debate with his client.
Essmyer says it's "highly likely" Stanford will seek a change of venue. However, Schaffer says he's not convinced that's a good move, considering that back in 2004 Hittner changed the venue of Enron figure Lea Fastow's trial to Brownsville. Fastow, the wife of former Enron Corp. chief financial officer Andrew Fastow, pleaded guilty in 2004 to one misdemeanor charge of filing a false tax return, and Hittner sentenced her to the maximum of 12 months in federal prison and one year of supervised release.
"Brownsville -- I can't think of a worse community to try a case of a former billionaire," Schaffer says about the prospect of a trial for Stanford in the border city of Brownsville.
Schaffer also says it takes a lot of money and time to properly build evidence supporting a change of venue motion.
The federal government "takes no position" on Stanford's motion to substitute counsel, but maintains that substitution of counsel should not be the reason for a change in the trial date, Stanford alleges in his March 30 motion.
Assistant U.S. Attorney Gregg Costa of the Southern District of Texas, who is prosecuting United States v. Robert Allen Stanford, et al., declines comment.
Neither did DeGuerin and Secrest. Bob Bennett of Houston's Bennett Nguyen Joint Venture, also did not return a call before press time on April 1.
Meanwhile, Schaffer reports that on March 30, insurance companies holding SFG's directors' and officers' policies paid him and Secrest in full. Schaffer says the payment reimbursed them for more than $200,000 in expenses, and paid their fees. He declines to say exactly how much they were paid.
"It was a respectable amount," he says.
The insurance company payment came after Hittner issued a preliminary injunction in January that ordered two insurance companies to advance defense costs to SFG executives facing criminal charges and civil litigation. In March, a panel of the 5th U.S. Circuit Court of Appeals modified Hittner's injunction, affirming the order "only insofar as it provides for coverage until a court determines otherwise."
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