By Camilo Smith
By Craig Malisow
By Jeff Balke
By Angelica Leicht
By Jeff Balke
By Sean Pendergast
By Sean Pendergast
By Jeff Balke
Assistant U.S. Attorney Abe Martinez "held out until the night before trial to give us our discovery requests," says Brown. "Six hundred audiotapes. How could we possibly listen to 600 audiotapes the night before trial?"
Although Judge Werlein granted the defense team a two-month extension, DeGuerin recalls there was other exculpatory information he requested that the prosecution was never forced to hand over. Specifically, DeGuerin says he attempted to obtain a caveat letter that had accompanied several sets of profit-and-loss statements for fake companies that John Clifford claimed to own. Clifford had ordered Brown to combine the numbers and send the figures out to potential clients. Brown says the numbers were part of Clifford/Francis's plan to show that Brown had a predisposition to commit a crime, something the government needed to establish to proceed with its entrapment plan.
"He gave me financial statements for four fake companies to combine with Neal's," says Brown, adding that he didn't know that the businesses didn't exist. "And all I did was add up the numbers Francis gave me. It's not like I made them up."
When Clifford ordered Brown to send out the new numbers to the potential clients, Brown decided to include a caveat letter stating that he could not verify the figures. But when the documents were presented as evidence in court, there was no caveat letter to be found. Without the letter, says DeGuerin, it appeared that Brown was attempting to play fast and loose with the numbers.
"In discovery, they didn't give us the caveat letter," says DeGuerin. Its existence was proved only during DeGuerin's cross-examination of Jackson, Brown's former boss. The judge then ordered the prosecution to produce the evidence. The defense eventually received the documents, and the Brown trial ended in a hung jury. Three months later federal prosecutors decided against retrying Brown, and the charges were dismissed.
When word of Operation Lightning Strike surfaced in the media, Sharon Hogge had a feeling she knew some of the people involved, but the former U.S. Navy engineer never thought she would be one of them.
During the time that Francis was under cover as businessman John Clifford, Hogge was working in Houston as vice president of marketing and sales for Automaker. As a small high-tech robotics company, Automaker was struggling to land government contracts like the one it had won from the U.S. Army to build two robots to weld military machinery. Those contracts never materialized, and in March 1994 Automaker had to liquidate its assets. Hogge left the company before it went out of business, but following her departure, she heard rumors that the authorities were investigating allegations that Automaker had defrauded the government by filing false billing claims. Out of curiosity, Hogge decided to attend the auction, and she immediately identified some of the others in attendance as federal agents.
"It was pretty clear," she says. "They were all young and fit. All the other guys were older and wearing coveralls and looking to buy machine tools."
As the auction proceeded, the sleek-looking blond struck up a conversation with a couple of agents who asked if she'd be willing to come by their office and answer some questions. Hogge said she'd gladly help with their investigation. "The first day I went in to talk with the agents," remembers Hogge, "they took me back through two locked doors, and you sit in this little tiny room, like a little bitty library. The only way out was through the fifth-floor window. Francis was there. I knew of him from the news reports. The agents were all wearing guns. Sometimes I thought the easiest way out [of the mess] would have been for them just to have shot me. And I still feel that way at times. I wish they had just killed me that day, and it would have been over with."
After several sessions with the agents, Hogge began to worry that she had become a target herself. She decided she'd better get herself an attorney, so she contacted DeGuerin. "She was giving [the FBI] the names of people who knew about various things that were going on at Automaker," says DeGuerin. "It got pretty complicated, and she got kind of worried dealing with these folks. They kept telling her nothing was going to happen to her, but she was worried. So she comes to me, and I tell them that either she gets immunity or all bets are off."
Following DeGuerin's ultimatum in September 1996, a federal grand jury indicted Hogge along with Dan H. Stinger and James B. Morris, the former Automaker chief executive officer and operations manager, respectively. The essence of the 11-count indictment was that the trio had defrauded the government by billing the Department of Defense and the Department of Energy for work on robotics projects that hadn't even started yet. If convicted, Hogge faced up to 40 years in prison and $2 million in fines.
Key to the prosecution's case was its contention that Automaker had billed for mechanical drawings that didn't exist. The defense insisted the drawings did exist, and that they had been seized by the FBI. By the time the trial started, the blueprints still had not been produced. In fact, a former employee of Automaker testified -- under threat of prosecution -- that the drawings had never been done, but that he had been instructed by his bosses to say that they had.