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VOL. 123 | NO. 126 | Friday, June 27, 2008

Questions Remain Unanswered in Ford-Lee Case

By Andy Meek

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Joseph Lee

With a federal corruption case pending against him, Joseph Lee walked into the office of Kendall Investigations in Knoxville and met with former FBI special agent Kendall Shull. It was Oct. 16, 2007, and Lee – the former president and CEO of Memphis Light, Gas and Water Division – was there in an effort to clear his name. He had traveled to Knoxville to take a polygraph test at Shull’s office. Lee’s attorney, Robert Spence, said this week he had planned to somehow publicize the results of the polygraph – which Lee passed – to defend his client against federal bribery charges.

But he never got the chance.

Edmund Ford Sr.

Prosecutors Tuesday dropped their case against Lee and former Memphis City Councilman Edmund Ford Sr. The two men were indicted in July in a federal corruption probe that alleged they were part of a favor-swapping scheme.

Memphis Mayor Willie Herenton said Thursday he believed prosecutors dropped the case against Ford and Lee to focus on an investigation and possible indictment of the mayor. Read more about Herenton’s remarks at www.memphisdailynews.com.

Trial by ordeal

Lee stood accused of allowing Ford to rack up some $16,000 in unpaid bills to the utility company. The leniency was allegedly in return for Ford’s support of Lee’s selection by the council in 2004 as head of MLGW, among other things.

Ford was acquitted by a jury in a separate corruption case last month. About a week or so after the former councilman was acquitted is when prosecutors first tipped their hand about a possible dismissal of the case against Ford and Lee.

In the first case against Ford, prosecutors at least had undercover videotape shot by Joe Cooper, a former member of the Shelby County Board of Commissioners. Cooper recorded encounters with Ford during which he paid the councilman cash supplied by the FBI allegedly to secure Ford’s vote for a billboard zoning case.

There has been no indication that prosecutors had similar recordings in the case against Ford and Lee. Most of what they apparently did have was unpaid bills – unpaid bills that eventually got paid. Ford paid off his debt to the utility company in March 2007, a few months before he was indicted with Lee.

Spence told The Daily News that prosecutors first brought up the idea of dropping the case in a series of phone conversations a few weeks ago.

“He’s obviously ecstatic about the case being dismissed,” Spence said, referring to Lee. “But he’s certainly conflicted emotionally. His reputation has been tarnished by the events that led up to the indictment and then including the indictment. He is happy and somewhat angered by this ordeal.”

Prosecutors are not publicly addressing their motives for dropping the case. The only reason given in the motion to dismiss the indictment is that it is “in the interest of justice.”

An iron curtain

The MLGW case traveled a long, complicated and highly publicized path over the past year. And the result of Lee’s polygraph makes at least one thing clear: The full picture of a scandal that put Memphis in the national spotlight is not likely to be known.

The polygraph test offers one reason. It was administered by Shull, who was the former polygraph supervisor for the FBI. He asked the former MLGW head just two questions.

The first question: “Did you ever have an agreement or understanding of any kind with Edmund Ford regarding his utility accounts?” The second question: “Did you and Edmund Ford at any time have an agreement or understanding of any kind regarding leniency of his utility accounts?”

Lee’s answer to both questions was “No.” Based on details of his polygraph report, the test found no deception in Lee’s responses. That’s one of three results the test would have shown – either “No deception indicated,” “Deception indicated” or “No opinion.”

Polygraph results generally are inadmissible in court. But the results may have been part of the reasoning last month behind Spence’s public statement that he felt he had a sound basis to file a motion to dismiss the charges against Lee.

Some insight

At least one television news report this week about the dismissal of the case against Lee and Ford mentioned Lee’s polygraph. What was not mentioned is another prominent public figure to whom Shull administered a polygraph and who reportedly passed the test: former Atlanta Mayor Bill Campbell.

Shull administered a polygraph exam to Campbell in 2004, when Campbell was facing his own public corruption indictment. Campbell passed that test, according to news accounts from that time.

But the test only focused on corruption charges in the indictment against Campbell. And even though Campbell and Lee passed the lie detector test given by Shull, they did not meet the same fate.

A jury went on to find Campbell guilty in 2006 of the charges in his indictment that concerned filing false tax returns and underreporting income. Whether the defense Lee would have presented would have been materially stronger is a matter of speculation.

‘Put up or shut up’

Outside the Downtown federal building last month – the same week Ford was acquitted in the first corruption case – Spence did not indicate that discussions with prosecutors about a dismissal had begun. After a status hearing in the case that day, Lee’s attorney spoke mainly about his impending August trial date.

Spence said he had reviewed “thousands and thousands” of documents from the utility company over the past year and guessed a trial would last two or three weeks.

“But we’re going to go right at them,” Spence said of federal prosecutors. “We’re going to ask them to put up or shut up. We’re still looking for what the government has that led them to believe a crime was committed.”

With Ford’s acquittal in May and this week’s dismissal against Ford and Lee, federal prosecutors now have effectively lost two local corruption cases in a row. But prosecutors in the U.S. Attorney’s office for West Tennessee are moving on – in more ways than one.

Assistant U.S. Attorney Tom Colthurst, one of the local prosecutors who tried Ford’s first case, is leaving the West Tennessee office this month to work in the U.S. Attorney’s office in San Jose, Calif.

Larry Laurenzi, the other main prosecutor and familiar courtroom presence during Ford’s first case, is now the acting U.S. Attorney for West Tennessee and because of that likely will not have the same direct role in the courtroom.

His shift into the position of acting U.S. Attorney was the result of David Kustoff resigning in March as U.S. Attorney for West Tennessee.

PROPERTY SALES 39 202 12,960
MORTGAGES 25 110 8,113
BUILDING PERMITS 114 645 30,579
BANKRUPTCIES 37 122 6,186