The goal of defence lawyers in their cross examination of Chris Craib has been two-fold. First, destroy the credibility of the former Livent controller who testified that he witnessed Garth Drabinsky openly discuss plans to manipulate the companys financial results at a meeting in April 1998. Second, convince the judge overseeing the case that Craib is involved in a complex and wide-ranging conspiracy to frame Drabinsky and his former partner Myron Gottlieb for the alleged accounting fraud that ultimately destroyed the once well-respected theatre company.
That conspiracy theory took a not entirely unexpected twist earlier today as Brian Greenspan, the defence lawyer representing Gottlieb, accused Livents lawyers at Toronto-based law firm Stikeman Elliot LLP of altering evidence to prop up its claims against the Livent founders. And Greenspan has the tapes to prove it.
Transcripts of an extensive interview with Chris Craib about that now-infamous April meeting have been altered to eliminate Craibs assertion that Gottlieb was not at the meeting, Greenspan told the court. Greenspan played audiotape excerpts of Craibs interview with Robert Webster, Livents executive vice-president, and Stikeman lawyers Patrick OKelly and Peter Howard. In the tape, Craib is asked if Gottlieb attended the meeting and he clearly replies: Myron was not at the meeting.
But that is not in the interview transcript, Greenspan pointed out. There are 2,000 questions asked to you and the other members of the finance department but that is the only Q&A not transcribed, Greenspan said.
Greenspan played another taped excerpt from the interview where Craib is asked about the Friday-night meeting. Craib corrects the interviewers and says he believes they are referring to the Friday afternoon meeting with Garth and Gord. But in the transcript, Gord has not been included, leaving the impression that it was not a meeting limited to two participants, and opening the door to the idea that Gotlieb could have also been in attendance, Greenspan suggested.
Two times they are trying to put Myron at a meeting that he was not at, Greenspan said.
I have no knowledge of this, Craib replied.
No knowledge of this? You are part of it. Part of the effort to frame Mr. Gottlieb, Greenspan shot back.
Greenspan cited a third and more troubling example when comparing Craibs transcript of his interview with Stikeman Elliot with an affidavit filed by Webster in Livents lawsuit against Drabinsky and Gottlieb. In the transcript, Craib says that when Drabinsky and Gottlieb began discussing plans to manipulate the companys first quarter financial statements: I wasnt taking notes, I wasnt doing anything. However in Websters affidavit that phrase is transformed into I wastaking notes.
The Webster affidavit is a lie, Greenspan said.
I cant speak to that, said Craib.
Stikeman Elliot has changed your evidence. Did they have your permission to change your evidence? Greenspan asked.
No. I dont have any part of this, Craib replied.
As I said earlier, the allegations are not altogether surprising. Gottlieb originally made them in a $50-million civil suit that named a group of prominent Stikeman lawyers, Michael Ovitz, the accounting firms of Deloitte & Touche and KPMG as well as Craib and Maria Messina, Livents former chief financial officer as defendants. In the 2006 lawsuit, Gottlieb accused Stikeman and others of carrying out a concerted and planned scheme to manipulate documents and information” in an attempt to show that he attended that April 1998 meeting.
In their statement of defence, Stikeman called Gottliebs assertions highly implausible. They did not address how the errors appeared in either the transcript or the affidavit but argued that the suit should be dismissed since it is impossible to argue that you are the innocent victim of a conspiracy that led to criminal charges until a court finds you not guilty of those charges. A judge agreed and dismissed the suit late last year.
Thats not the only discrepancy between the transcript of Craibs interview with Webster and the Stikeman lawyers and other evidence regarding that April 24 meeting, Greenspan said. In handwritten notes Messina made about her phone conversation with Craib following the meeting she notes a number of alleged accounting manipulations that were discussed.
One of the manipulations allegedly involved adding $1 million to Livents foreign exchange accounts. However, Craib said in his interview that April 24 was too early to be discussing foreign exchange accounts, Greenspan pointed out.
What you say is a total contradiction with the telephone conversation you had with Maria Messina on April 24, Greenspan said.
Its very complicated, but I did say this in my transcript, Craib replied.
Its very complicated because the notes of April 24 are a complete fiction, Greenspan fired back. There were no notes. She was taking notes of a meeting you did not attend.
Greenspan continued to insist that Craib fabricated his testimony about attending the April 24, 1998 financial manipulation meeting with Drabinsky and Eckstein. After all, why would Craib not correct Messinas mistaken impression that Gottlieb attended the meeting? Craib previously testified that on May 4, 1998, Messina came into his office, trembling and in obvious physical distress and asked him to type a memo from her handwritten notes where she pleaded with Drabinsky and Gottlieb to reconsider their plan to manipulate the companys financial results.
First Im with a woman who is trembling and crying, Craib replied. Im confused as well and I assumed she talked with Myron because in the first sentence there is a reference to that.
So you let her send something that was wrong, Greenspan replied.
Mr. Gottlieb was not at the meeting, correct, Craib said.
The irony is that the first quarter of 1998 was the last quarter that prosecutors allege there was even an attempt to manipulate Livents financial statements. And ultimately, Drabinsky never went through with most of the alleged manipulations that were discussed at the meeting. Instead, Ovitz insisted the Livent managers take a $27.5 million write down as part of his deal to buy a controlling stake in the company. The deal was announced shortly after that April 24 meeting.
Afterwards, Gottlieb tried to reassure Messina about new management learning about the alleged manipulations and told her that Drabinsky and Gottlieb would be in charge of the companys financials for some time after the takeover. Gottlieb allegedly told her that the second quarter will still be ours, Messina said. However, in her testimony at the trial, Messina said that she misspoke and said Gottlieb was referring the first quarter.
Messina corrected her story because it was a ridiculous assertion that had been concocted by Craib and Messina to implicate Gottlieb, Greenspan said. I suggest to you that it was a story that you and Maria Messina were cooking up to cover the wrongdoing you were involved in, Greenspan said.
No sir, Craib said.