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Are We Nearing the End of Livent's Never Ending Trial?

In some ways, attending the criminal fraud trial of Garth Drabinsky and Myron Gottlieb these days feels like watching the last Lord of the Rings. Like the movie, the case is long and features epic battles between two formidable opponents And like the end of the last movie, just when you thought it might end it keeps going and going.

Earlier today, defence lawyers wrapped up their cross examination of John Beer, one of the KPMG investigators, who searched the offices of Drabinsky and Gottlieb and seized documents prosecutors maintain show that the Livent founders masterminded the alleged accounting fraud at the once successful theatre company. Prosecutors will not call any more witnesses. But that is not the end of the trial.

Court will resume tomorrow so prosecutors can introduce several documents relating to Gottlieb. The trial will pause again on Wednesday to allow lawyers to attend funeral services for former Ontario Chief Justice Charles Dubbin.

But with the prosecution case all but completed, there is still no indication whether the defence will call any witnesses of its own or whether Drabinsky and Gottlieb will testify in their own defence. Perhaps defence lawyers are waiting to see if they can get a read on how the normally inscrutable Madame Justice Mary Lou Benotto has reacted to their questioning of Beer and his fellow KPMG investigator Gary Gill regarding their efforts to secure the documents that now make up the bulk of the prosecutions case.

After a week of testimony about the KPMG investigation, it is clear that if new Livent managers, or the much-maligned lawyers from Stikeman Elliott LLP, had wanted to plant the damning documents found in Drabinskys office, they certainly had the opportunity. After all, as was pointed out by Edward Greenspan, the defence lawyer representing Drabinsky, the KPMG search was far from perfect.

Gill and Beer testified that they searched Drabinsky and Gottliebs offices on August 11 th. Gill finished the search of Gottliebs office without Beer on August 12 thsince Beer had to travel to British Columbia for another unrelated assignment that day. As a result, the search was rushed, Greenspan suggested.

If this was a police search, I would agree with you 100%, Beer replied. But this was not a police search. We didnt have the opportunity to do that at the time, we just didnt have the time.

There was no gun to your head, Greenspan replied. The only time constraints were your own in that you had to leave for British Columbia the next day.

I dont disagree with that, Beer replied.

Beer and Gill initialed some of the documents they discovered in the offices. However, other documents were not initialed, Beer told the court. Sometimes Beer or Gill merely initialed the folder where the documents were found. Ideally, it would have been more prudent for investigators to have initialed every page of every document they found and placed them in sealed boxes to be catalogued as evidence, Greenspan suggested.

Initialing the back page of a multiple page document does not prevent someone from adding or replacing pages to that document, does it? Greenspan asked.

No, it does not, Beer replied.

And initialing the front of a file folder does not prevent someone from adding or subtracting documents to that folder, does it? Greenspan continued.

No sir, Beer replied.

Greenspan went on to suggest that documents could have been added or subtracted to Drabinskys office even before KPMG began their investigation. You are in no position to state that a document that you signed on August 11 thwas actually in the office on August seventh, eighth, ninth or 10 th, Greenspan stated.

Thats correct, Beer replied.

Those documents were eventually moved to a locked storage room on the second floor of Livents offices. Unlike the sixth floor executive offices, there was no guard stationed at the door, and access to the room was only monitored by a log book that people in the room were supposed to sign. Greenspan noted that several people had keys to the room and the honour system was used with the log book with people choosing to sign it or not.

Tell me, through your years of experience in law enforcement, and I know you have a lot of years of experience, was it customary for the RCMP to grant access to the evidence room using an honor system?

The answer to that is no, Beer replied.

But Greenspan was less successful in his attempts to get Beer to concede that it was a Stikeman Elliott lawyer who discovered a document listing more than $21 million in accounting problems from 1997 that had been moved into 1998. Gill testified that he found the document in one of the two brown leather briefcases next to Drabinskys desk. In previous testimony, former Livent controller Chris Craib testified that he saw Drabinsky take the document from his briefcase and wave it at Gordon Eckstein, Livents former senior vice president of finance and administration, during an argument.

Greenspan suggested to both Gill and Beer that it must have been Stikeman Elliott lawyer Patrick OKelly who found the document. In his testimony last week, Beer asserted that OKelly had nothing to do with the discovery of the document. Today, he said he was absolutely certain that OKelly did not find the document.

Neither Brian Greenspan, the lawyer representing Gottlieb, nor the judge had any questions for Beer. With the testimony of the last of the prosecution witnesses now completed the trial may soon be over and the judge may soon render her verdict. More than 10 years after the alleged accounting fraud at Livent and nearly six months after this trial began this case is beginning to look like another fantasy movie: The Never Ending Story.