vitapro

Sept. 9, 2005, 10:18PM Judge acquits 2 men convicted in VitaPro kickback scheme

RESOURCES WHAT THE JUDGE SAID

From U.S. District Judge Lynn Hughes' ruling: * The key witness: Lied because he had a secret deal with prosecutors * Retrial: If his decision is overturned, the defendants should get a new trial.

A federal judge has overturned the 4-year-old bribery convictions of a former Texas prisons director and a Canadian businessman, ruling that the prosecution's key witness lied to curry favor with a federal prosecutor in Louisiana.

U.S. District Judge Lynn Hughes late Thursday acquitted James "Andy" Collins, former executive director of the Texas Department of Criminal Justice; and Yank Barry, owner of VitaPro, a company that made a soy-based meat alternative fed to inmates.

The judge ordered that should the U.S. Attorney's Office successfully appeal his decision, Collins and Barry will get a new trial.

Hughes' decision comes four years after the pair's convictions because of delays in obtaining a trial transcript so that the defense could file a motion seeking the acquittal. The court reporter suffered a nervous breakdown and the transcript was filled with errors, according to Hughes' opinion.

A federal jury in August 2001, found that Barry paid two $10,000 bribes to Collins in return for pushing a no-bid contract with VitaPro to feed its product to Texas prisoners. The two were convicted on bribery, conspiracy and money laundering charges.

Hughes overturned the convictions, ruling that the government's key witness, Patrick Graham, lied during the trial to please then- Assistant U.S. Attorney Jim Letten in the Eastern District of Louisiana.

"Graham had a secret deal with the United States Attorney for the Eastern District of Louisiana that ó in exchange for his testimony in numerous cases ó the U.S. Attorney would not prosecute him for his crimes in Louisiana and would even seek a sentence reduction for his crimes in other states," Hughes wrote. "With this motivation, Graham conveniently knew all sorts of information about nefarious dealings in other districts."

Graham and his brother, Michael, were key witnesses in Letten's prosecution of former Louisiana Gov. Edwin Edwards and former Houston Mayor Fred Hofheinz on corruption charges. Letten is now U.S. Attorney for the Eastern District of Louisiana.

Edwards was sentenced to 10 years on racketeering charges and was sent to prison. Hofheinz pleaded guilty to failing to report he was the victim of an extortion attempt, and federal prosecutors dropped felony charges that he paid bribes to win a state contract.

Charges of misconduct

Kent Schaffer, one of Barry's attorneys, charged that the secret deal between the Graham brothers and federal prosecutors in Louisiana represented prosecutorial misconduct "in its highest form."

"They wanted Gov. Edwards so bad that they were willing to do anything and everything it took to get him. And they got him. But along the way, they blew their credibility with the court," Schaffer said Friday.

Nothing about the deals was ever put in writing, he said. "The judge was very troubled about it," Schaffer said, "because these (plea agreements) are supposed to be very transparent." Even local federal prosecutors were ignorant of the deals, he added. Letten did not respond to a request for comment. "I do want to say that I know Jim Letten both personally and by reputation, and he is an extraordinary public servant and a very honorable man," Chuck Rosenberg, interim U.S. Attorney in Houston, said Friday.

Rosenberg said he had not decided whether to appeal Hughes' acquittal order. "We are studying the decision and weighing our options," he said.

Even if the 5th U.S. Circuit Court of Appeals overturns Hughes' decision, defense attorneys believe they are ensured a new trial. "What Judge Hughes is saying is that, even if the 5th Circuit reinstates the conviction, we still get a new trial," said Schaffer. "The 5th Circuit can't take away the new trial." He added that he does not believe the government would try the case again.

Hughes said Patrick Graham's testimony was "riddled with contradictions," and that he concocted testimony to match documents shown him by FBI agents.

The opinion says Graham has a reputation for dishonesty and that he is "a thief and a tax evader." Hughes signed a $35 million civil- fraud judgment against Graham in 1995.

Attorney Bill Habern, who has represented Graham in other cases, said that, despite the court's opinion, the jury apparently found Graham's testimony credible.

Theft, tax case convictions

Graham also was convicted of theft in 1997 for accepting a $150,000 payment to break a man out of prison and of tax evasion in 1998 for failing to pay taxes on $5 million.

After Hughes was assigned the VitaPro case in 1999, he ordered the surrender of all records of immunity agreements, payments or government interventions made on behalf of the Graham brothers. In the opinion, Hughes said, "while other agencies were forthcoming, Letten resisted. He wanted to keep his deal with Graham secret." Austin attorney William White, who represented Collins, said, "I think the judge summed up Patrick Graham as a liar, a cheat and a thief."

Austin attorney William White, who represented Collins, said his client is "going to be happy to get on with his life." "This has affected his family greatly, and has affected him personally and professionally," White said. "He's hoping this will vindicate him in some way." Collins currently lives in Dallas, his lawyer said.

Barry is living in the Bahamas working in real estate development, said Michael Ramsey, another of his attorneys. "He's ecstatic and feels like he's finally been vindicated," Ramsey said. Barry and Collins had remained free on bond during the appeal process.

harvey.rice@chron.com

steve.mcvicker@chron.com

This article is: http://www.chron.com/cs/CDA/ssistory.mpl/ metropolitan/3347316