Week seven came to an abrupt end. It was a short week, only two and a half days, and it will be the first of three short weeks. How does that play out? The defense may be eager to get on with it, to show their side, but the delays have to work against the prosecution, if only just a little bit. In the brick-by-brick mechanics of building a case, flow and continuity mean a lot. Reasonable doubt can thrive in the gaps because if we think about anything long enough, we’ll inevitably doubt what we thought we knew. Now there’ll be at least a week between Martin and McVay.
This week, Jim Parkman was frustrated in his attempt to make Martin come crashing down, bringing Leif Murphy with him. And a drumbeat continued. Three CFOs, indicted co-conspirators, have all told a very similar story, and said they had first hand knowledge that Richard Scrushy was behind the fraud. And the close proximity of Scrushy, chairman of the board and CEO, to numerous events that were being played out in a company sagging under the weight of fraud, is starting to take its toll on a landscape where the defense will have to navigate its way out of the cloud, and they’ll have to do it with very little margin for error. Besides Scrushy’s meeting with Leif Murphy, when the fraud came into his office, there was the interruption of the meeting between Martin and a crying Diana Henze, there was the by-request meeting with Livesay, and the one with Martin and Bill McGahan. Code words? It wouldn’t take much. If the “know nothing” defense is abandoned and he is a victim of his omnipresent persona, in the company, it will be hard to say that he missed this one, that he was busy that day, that month, or that year.
But yet there are still doubts, waters muddied by contractual adjustments, the “bad management” theory, and a rogue’s gallery of indicted co-conspirators. All of that and the defense’s case looms on the horizon.
I wrote this week that whereas Livesay shared an insider view of the fraud machine, and Owens gave a view of the frantic last days of a company coming apart at the seams, the peek we got through Martin was closer to one of the many subtexts of this trial. That’s the ongoing impression that many insiders and outsiders have of the pre-investigation culture of HealthSouth, a place where fear, intimidation, mistrust and betrayal have become the norms, business as usual, while maintaining a public image of smiling athletes, inspirational shows the face of and an early darling of the face of success in the healthcare sector. But I caution that it is a subtext, some very good things prevailed. Some bad things too. And the complexity has all met together on the warp and weft of the courtroom.
