Rigases’ Lawyers Launch Defense

The defense in the fraud and conspiracy trial of Adelphia Communications Corp. founder John Rigas and his sons began presenting its case after prosecutors called their final witness.

With the trial in its 14th week in federal court in New York, lawyers for Rigas, 79, called a hospital administrator from his hometown of Coudersport, Pa., to testify to his good character and honesty. David Acker, chief executive of Charles Cole Memorial Hospital, said Rigas recruited physicians and promoted rural hospitals while serving almost three decades as a board member of the facility.

“I think John Rigas is one of the finest men I’ve ever met,” Acker told federal jurors in New York. “He’s a man of honor, and his reputation for truthfulness is excellent.”

On cross-examination, prosecutors peppered Acker with questions about his financial relationship with Rigas and Adelphia. Rigas and his sons Michael and Timothy are accused of hiding $2.3 billion in debt, stealing $100 million and lying about operations and revenue at Adelphia, the fifth-biggest U.S. cable company.

Acker said he and his family stayed two nights at Rigas’ condominium in Cancun, Mexico, in April 1998. Rigas told Adelphia that Acker stayed 14 nights. The company reimbursed Rigas $4,858, according to documents shown jurors by Assistant U.S. Atty. Judd Lawler.

Prosecutors completed their presentation to the jury after questioning their 16th witness, consultant Robert DiBella, who summarized his analysis of Adelphia’s books. Adelphia sought bankruptcy protection in June 2002.

The trial began March 1, and U.S. District Judge Leonard Sand has admitted about 1,050 exhibits into evidence.

The Rigases and former Adelphia Assistant Treasurer Michael Mulcahey are charged with conspiracy, bank fraud, securities fraud and wire fraud. Before prosecutors formally rested their case, Sand denied motions by the defendants to dismiss various charges in the 23-count indictment and a bid by John Rigas for a separate trial.

Mulcahey, 46, is expected to testify in his own defense as early as today.

Prosecutors say the Rigases looted Adelphia to buy company stock and debt, repay margin loans and cover other personal expenses. Defense attorneys say the Rigases, who left the company in May 2002, had intended to repay what they owed.

Acker, an attorney, testified that he did outside legal work for Adelphia on real-estate transactions before taking over the hospital eight years ago. He said on cross-examination that he and Adelphia’s former general counsel, Daniel Milliard, his former law partner, borrowed $205,000 from Adelphia in 1989.

The five-year revolving term note required repayment by 1994, Acker said. Adelphia agreed orally to extend repayment for several years, he said. Adelphia’s public disclosures showed that the loan balance was $152,000 in December 1999. Acker said that Milliard made all payments on the loan.

Acker also testified on cross-examination that he took several trips on Adelphia’s corporate jets without reimbursing the company, including one to West Palm Beach, Fla.