Updated Mar 4, 3:13 PM; Posted Mar 4, 1:05 PM
Attorney Donald Watkins arrives for the closing arguments for the Richard Scrushy trial at the Hugo Black Federal Courthouse in Birmingham, Ala, Wednesday, May 18,2005. Tamika Moore bnThe general counsel for the waste-to-ethanol company Masada testified Monday that he had been optimistic about selling the company to Waste Management.
On the witness stand, David Minkin, a lawyer from Atlanta, said a Washington lobbyist the company hired to make connections with that waste disposal giant led Masada's leadership to believe their prospects were good.
Minkin was the second defense witness called by Donald Watkins, Sr., who is on trial on federal bank fraud and wire fraud charges. According to prosecutors, Watkins and his son, Donald Watkins, Jr., duped former professional athletes, including retired NBA star Charles Barkley, out of millions. The defendants, who are representing themselves, have insisted Masada continues to be a viable company.
Prosecutors have said Watkins misled investors, telling them that a sale of Masada to Waste Management was in the offing long before Watkins and his colleagues had even met with Waste Management officials.
The prosecution has argued, too, that Watkins continued to say a sale was imminent, even after Waste Management had shown little interest in buying their company.
On the witness stand Monday morning, Minkin said a Texas-based lobbyist Ben Barnes gave the Masada company leadership hope for selling the company to the waste disposal giant. Masada entered an agreement with Barnes in April 2011 to make connections at Waste Management.
"Ben was very enthusiastic and felt he could introduce Masada to the highest levels within Waste Management," Minkin said.
But it was unclear how much Watkins's representations to investors were based in aspirations rather than facts. In April 2011 emails to Masada staff and investors, Watkins said Barnes was already in discussions with Waste Management to buy Masada.
However, Masada records and emails introduced into evidence show Masada didn't yet have a contract with Barnes when Watkins sent that email, and the company didn't meet with Waste Management to make its pitch until August 2012.
On cross-examination, Assistant United States Attorney Kyle Hankey sparred with Minkin, comparing Minkin's testimony Monday to a deposition he'd given to the Securities and Exchange Commission.
Minkin had told the SEC that Barnes had been hired to pitch Masada to other waste disposal companies, in addition to Waste Management, but in court Monday morning, he insisted their focus had been on Waste Management alone.
On the stand, Minkin argued that the prosecutor was using "literal words" to describe his previous testimony, and he insisted that his testimony Monday wasn't inconsistent with his previous statements.
"Is there a difference between the 'literal words' that you stated to the SEC and the truth as you apparently define it?" Hankey asked. Minkin said he didn't understand the question.
The exchange between the two lawyers devolved into an argument over semantics. At one point, Hankey asked Minkin whether it was important for the company to be truthful when communicating with investors.
"What does 'truthful' mean?" Minkin asked the prosecutor.
Testimony in the trial will resume Tuesday morning.
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