Deliberations begin in Arledge’s trial|[03/23/07]

Published 12:00 am Friday, March 23, 2007

JACKSON – A federal jury began deliberating this morning the fate of Vicksburg attorney Robert C. Arledge, accused by the federal government of knowingly filing false claims for payment from a pair of diet-drug settlement trusts.

After two hours of closing arguments by prosecutors and Arledge’s defense team Thursday, U.S. District Judge David Bramlette allowed jurors to recess and return this morning to begin deciding on whether Arledge is guilty of some or all of 24 counts of mail and wire fraud, conspiracy on both and money-laundering.

Arledge was accused in a May 26 indictment charging 34 counts. But 10 of the money-laundering counts were withdrawn, and Bramlette ordered jurors Thursday to ignore evidence and testimony on those charges.

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Rina Tucker Harris of the U.S. Department of Justice shrugged off during closing arguments the defense’s claim that Arledge did not participate in a scheme to fraudulently secure fen-phen payments for undeserving claimaints.

&#8220He ignored what was going on in his own office,” she said. &#8220He turned a blind eye. This case shows the defendant knowingly participated in filing false claims.”

Arledge surrendered to federal authorities in Jackson May 29, four days after FBI agents raided his home while he was away.

Prosecution witnesses have included people who have pleaded guilty to receiving settlements from the fund based on falsified claims. The defense position is that Arledge didn’t know the information was false and that prosecutors have failed to prove he did.

Arledge’s attorneys maintain he had no &#8220financial incentive” to knowingly file false fen-phen claims since he had already made millions in litigation. Furthermore, they’ve argued, others who have testified for the government and who have been convicted and sentenced for fraud or conspiracy acted independently of Arledge.

&#8220Why would Arledge take a risk on this scam when he’s made millions in legitimate claims?” lead defense attorney Karl Koch of Baton Rouge asked jurors Thursday. &#8220Why would a human being take a chance like that? If he’s guilty, he’s going to be running for the hills so fast. He’s going to be quiet.”

While working for Jackson law firm Schwartz & Associates, Arledge was part of a group of attorneys in 1999 that entered agreements allowing fee allocations, assigning responsibilities during fen-phen litigation and fixing percentages owed to them for each claim processed and approved. The attorneys called themselves &#8220the cartel,” the government has said. He is the only attorney charged.

To receive settlements, plaintiffs were required to show they had been prescribed Pondimin or Redux, and they were awarded different cash amounts, up to $250,000, depending on the extent of their medical conditions and the proof submitted to support their claims.

Promidin and Redux were used in a combination called fen-phen that was prescribed to treat obesity. They were pulled from the market in 1997 after research revealed they could cause heart problems.

Attorneys and other witnesses involved in helping process fen-phen claims have testified many claims originating from Schwartz & Associates appeared to have been fake, but that they could not prove Arledge was involved in the scheme to fraudulently collect fen-phen money.

&#8220The government hasn’t proven any of those charges,” Koch said. &#8220Robert Arledge is a good man.”

Assistant U.S. Attorney Harold Brittain argued that Arledge must have known that some of his own employees were involved in falsifying documents.

&#8220Mr. Arledge was in the middle of this for two years,” he said. &#8220I think that brings him out of the ‘mere presence’ definition.”

Another one of Arledge’s attorneys, Robert McDuff of Jackson, told jurors they cannot find Arledge guilty by association.

&#8220Merely being negligent, careless and foolish is not enough to be guilty of a crime,” he said. &#8220Justice is not doing what I call the wrong thing for the right reason. The proof is not there.”

In 2002, Arledge made an unsuccessful run for the judgeship of Warren County Court and Youth Court. He subsequently sought the job of prosecuting attorney for Warren County, first by gubernatorial appointment and then as a candidate for election. He did not receive the appointment and withdrew his candidacy before the election.