Taking Down the Lion: The Rise and Fall of Tyco's Dennis Kozlowski (28 page)

Summations

Good faith = no criminal intent. No criminal intent = no crime.

The most critical element the prosecution had to prove was criminal intent. When Justice Obus instructed the jury, he told them that “in order to establish that a defendant acted with the requisite larcenous state of mind, the People must prove that the defendant did not act under a claim of right made in good faith. That is that he did not believe that he had authority to take the property. The defendant does not have the burden of proof in taking the property he acted under a claim of right made in good faith. Rather, the prosecution must prove beyond a reasonable doubt that the defendant knew he did not have authority to take the property.”
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In his summation, Mark Swartz’s attorney Charles Stillman told the jury that when they looked at all that had been presented over the prior months, “[t]hat evidence will be—perhaps better said, the lack of evidence demonstrates that the District Attorney has failed entirely to meet its burden of proving beyond a reasonable doubt that [the defendants are] guilty of any crime.”

Stillman said, “My shorthand way of saying that to you now is good faith equals no criminal intent. In other words, as I said when we first spoke back in January, no criminal intent means no crime.”
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Deliberations

The jury was charged and deliberations began on Thursday, June 2, 2005. On Friday, June 17, 2005, the jurors sent a note to the judge stating that they had reached a verdict.

Part Four

Inglorious Ending

Eighteen

05A4820

The jury returned with guilty verdicts—lots of them. Dennis Kozlowski was found guilty of twenty-two of twenty-three felony counts. Mark Swartz was found guilty of the same, plus one additional count of grand larceny. It was Friday, June 17, 2005. It had been three years and two weeks since Kozlowski’s life began its downward spiral—since the sales tax indictment and his ouster from Tyco.

The newly convicted former executives were allowed to leave the courthouse the day the verdicts were handed down. Justice Obus said, “Under all the circumstances I’m satisfied at least for the period of time that the defendants will not be a flight risk, and that it is appropriate to allow them at liberty on the bail that has been posted, at least for this adjournment.”
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Sentencing

Supreme Court, New York County

Manhattan Criminal Courthouse, 13th Floor

100 Centre Street

New York City, New York

September 19, 2005

Kozlowski and Swartz, by then the white-collar version of Butch Cassidy and the Sundance Kid, returned to court on September 19, 2005. In the courtroom where they spent much of the prior three years, the former CEO and CFO of Tyco International were sentenced for the crimes of which they were convicted.

Justice Obus addressed Kozlowski and Swartz in turn. He said, “L. Dennis Kozlowski, you are before the Court for sentencing following your conviction after trial to 12 counts of grand larceny in the first degree, one count of conspiracy in the fourth degree, one count of violation of general business law, and eight counts of falsifying business records in the first degree.”

The Court:
Does Mr. Kozlowski wish to make a statement?

Defendant Kozlowski:
Yes, your Honor. I have a very brief statement to make. First of all, I want to thank your Honor and all of the Court personnel for the many courtesies that have been shown to my family, my friends and to me in these proceedings which have run a span of three years. I hope your Honor concludes from the 130 letters you have received from people from all walks of life have provided you with an accurate picture of who I really am as opposed to the person portrayed at times in this courtroom and in some parts of the media. I also hope that in deciding what sentence to impose your Honor not only considers the verdict, but also considers all the positive things I have done in my life. Your Honor, I recognize the sentence will include incarceration. I ask you to please be as lenient as possible. Thank you very much.

After Kozlowski addressed the court, Mark Swartz also made a brief statement:

Defendant Swartz:
Your Honor, I never thought I would be in the position I am today, nor did I ever fear, and the reason is I always hold myself to a high standard of integrity, honesty. Every day I tried to make my family and me proud of the man I am. The assistant District Attorney was correct on one matter, and that is you have heard directly from me in two trials as to my views on my actions and the reasons for my actions. And in this very courtroom every word I said was the complete and honest truth. I ask you in making your decision on my sentence to consider my actions, the reason for my actions, and I also ask you to return me to my family as soon as possible because I do consider it a relationship of vital importance. And I have been fortunate in the continued support I received from my wife, parents, in-laws, kids, family friends and attorneys, and it’s that continued support that I’ll be forever grateful for. Thank you.

The defense legal teams submitted briefs in which they requested imposition of the minimum sentences allowable under New York law. Minutes before Kozlowski and Swartz were sentenced, Assistant DA Heimer opposed those requests, specifically in regard to Kozlowski, and stated, “The People recommend that the Court impose on Dennis Kozlowski the maximum consecutive prison sentence authorized by law.” The Manhattan DA’s office, in effect, asked for a sentence of 300 years (a maximum sentence of twenty-five years for each of the twelve counts of grand larceny to be served consecutively). Assistant DA Donnelly addressed the court with regard to Swartz, saying “It is our recommendation that this Court sentence Mark Swartz to the maximum sentence permitted by law.”

Justice Obus, after having presided twice over the prosecution of Kozlowski and Swartz, stated before imposing sentences:

The Court has sat in this room with defendants and their families and their supporters, of course with counsel during two trials for large portions of the last two years and is cognizant of the ordeal this process has been and the pain the sentences to be imposed will undoubtedly cause to defendants and to others. That is inevitable in a matter like this. And while again I do not necessarily view the defendants’ conduct in quite as stark terms as do the People, it is the Court’s responsibility to impose sentences that are commensurate with the magnitude of the offenses in question.

Justice Obus added, “I will note for whatever it is worth, I do not view the defendants as security risks . . .”

After the People and the court had spoken, Kozlowski and Swartz faced the moment that they had no doubt feared since being indicted three years earlier. The court explained that prison terms imposed on the grand larceny counts would be the controlling sentences, as they were the most severe: “I’m imposing indeterminate sentences on each of those counts involving the unauthorized compensation to the defendants of an indeterminate term of imprisonment of eight and one third to 25 years.”

Justice Obus ordered that the prison sentences be served concurrently and stated that the Department of Corrections would decide where the men would serve their time. In addition to imposing the maximum indeterminate prison sentences, the court ordered Kozlowski and Swartz to pay restitution to Tyco in the amount of $134,351,397—the total amount they were convicted of stealing from the company. Of the total, $97 million was apportioned to Kozlowski and $37 million to Swartz, although they were jointly and severally liable for the full amount. In addition, Swartz was ordered to repay an additional $1.2 million on a separate count of grand larceny for which Kozlowski was not charged.

On top of the prison sentences and restitution, Kozlowski and Swartz were ordered to pay criminal fines in the amounts of $70 million and $35 million, respectively. The criminal fines may very likely have been the largest ever imposed on individuals by the State of New York.
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Kozlowski said that as quickly as possible, he paid the ordered restitution to Tyco in full, and that he also paid in full the criminal fines due to the Manhattan DA.
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The newly sentenced soon-to-be inmates requested bail during the pendency of their appeals, but those requests were denied.

Inmate 05A4820

Kozlowski and Swartz were taken into custody as soon as the sentences were imposed by the court. Kozlowski recalled that “we were immediately cuffed and remanded. I was taken out the back door of the courtroom and directly to The Tombs, [a New York State prison,] which is by the courthouse. I was processed at
The Tombs. The sentencing was at 11:00 [am] and I was processed until around 1:00 [pm]. They took my mug shot, I was fingerprinted—they used electronic fingerprinting. After I was processed, I was placed in a cell at The Tombs for a couple of days.”
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From that day forward, Dennis Kozlowski would be known to the State of New York as inmate 05A4820.

After spending two days at The Tombs, Kozlowski was moved at around 4:00 am to Rikers. Kozlowski said, “I hung out at Rikers for a couple of hours and then I was put on a bus and taken to Downstate, where I had to be processed again.”
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Downstate Correctional Facility is a maximum security New York State prison in Fishkill, about seventy-five miles due north of New York City.
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Kozlowski was at Downstate for eight and a half months.

“I was in a cell by myself. It was maximum security, so everyone was in a cell alone,” he explained. “I was allowed out of my cell for one hour every day. I never went outside—not for eight and a half months. I was allowed to have books so I spent most of my days reading. I had no access to a telephone—not for eight and a half months.”
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Kozlowski said, “I was allowed to have visitors seven days a week. I had a lot of visitors. [My daughter] Cheryl would write letters to me and let me know who was coming to see me.” Kozlowski said inmates were permitted to request new underwear and socks every nine months, which he did. “That seemed to trigger the move from Downstate,” he said.

Kozlowski recalled that he was given about thirty minutes notice before he was moved. “Two COs [corrections officers] told me at 8:00 am that I was being moved. It was easy to pack,” he remembered. “I was shackled and chained, and handcuffed. They put a black box over the cuffs and locked the black box to the chain around my waist. It’s a miserable way to travel,” he said. “I was in a van with two COs—I was the only inmate in the van. I asked as soon as I was put into the van where I was going to go. The orders were in a sealed envelope that could only be opened after we left the prison. The COs opened the envelope but didn’t tell me where I was going. I think it was about a three hour drive and we ended up at Mid-State.”

After he was unloaded from the van, Kozlowski was processed again, just as he had been at The Tombs and Downstate.
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Mid-State Correctional Facility

When he arrived at Mid-State in late May of 2006, Kozlowski settled into the cell in the protective custody unit where he would sleep for the next six and a half years. “I could never have imagined I would be there that long,” he said.
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During his years at Mid-State, he was assigned the job of doing laundry for the inmates in his unit, and
he became the self-appointed “laundry czar,” for which he was paid about a dollar a day. Like all prisoners of the State of New York, he wasn’t allowed to touch money; his earnings went into an account from which he could purchase items from the prison’s commissary.

Kozlowski saw many inmates come and go from the protective custody unit. There was a transgendered inmate whose clothing made his laundry duties a little more interesting.
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Rapper Ja Rule, aka Jeffrey Atkins, was in June of 2011 placed in the same unit where Kozlowski was housed. In an interview he gave to the
New York Daily News
in February of 2012, Ja Rule said, “I was studying for my GED and Koz came in and talked to me and said, if you need any help, let me know.” Ja Rule told the journalist that Kozlowski encouraged him to go to college and to study business. The rapper also said that former New York State Comptroller Alan Hevesi was serving time in the same unit with him and Kozlowski. Hevesi, who was convicted in a pay-for-play scandal that involved the New York State Common Retirement Fund, was paroled after nineteen months. Ja Rule was released from Mid-State in February of 2013 after serving his sentence for weapons possession. He immediately served three additional months in another facility for federal tax charges and was released in May of 2013.
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While he served his time, there were two suicides in Kozlowski’s unit at Mid-State. “I found one of the guys,” he recalled, “when I delivered his lunch. I looked into his cell and saw the guy had cut his wrists. He used one of the plastic razors they let us use to shave. There was blood everywhere. It was one of the worst things I saw in prison.”
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Kozlowski passed the years at Mid-State doing laundry, reading hundreds of books, tutoring other inmates, and taking advantage of every prison program available to him. He also taught himself to paint—an interesting choice of hobbies, considering the consequences he suffered as a result of his venture into the world of fine art. Kozlowski said he lived for visits and for mail call. “I wrote and received hundreds of letters,” he said. “From my friends, from family, from students, and from strangers. Every time the
60 Minutes
or
American Greed
episodes ran, I received dozens, maybe even hundreds of letters from people I didn’t know.”
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During the years he was in prison, which had not yet ended at the time of this writing, Kozlowski was strip searched more than 1,200 times—and counting. He wrote of the practice: “Nothing you ever read prepares you for the experience of being stripped naked in front of strangers who then examine every crevice and orifice of your body. I’ve never heard of contraband (illegal substances and/or weapons) brought into a prison in so obvious a way. The essential purpose of the strip search is to humiliate someone fortunate enough to enjoy a visit from a family member or friend.” Kozlowski opined that “[e]very judge who declared the strip search constitutional should, just once, be commanded to strip, spread, bend, and lift while naked.”
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Kozlowski wrote of his time at Mid-State: “It’s difficult to see violent criminals and child molesters come and go here (serving 2 to 3 years) while my life passes by.”
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In February of 2011, Kozlowski wrote, “My 65 1/2 months in a NY State prison suck. It’s the toughest of all tough places I’ve ever found myself. I’m far from happy, but I constantly seek to be at peace.”
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Kozlowski’s second wife filed for divorce in July of 2006, a couple of months after he arrived at Mid-State. The divorce was finalized two years later.
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During his lengthy prison sentence, Kozlowski had a lot of time to reflect on his life and all that had happened since he was a boy growing up in Newark, New Jersey.

The Punishment

“The length of the sentence was a complete surprise,” Kozlowski said. “I was expecting, worst case, up to five years.”
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“There was an article in one of the papers that day—maybe the
Wall Street Journal,
that said five years was probably the longest sentence we’d receive,” Kozlowski recalled. “I knew there would be prison time. I knew after the guilty verdicts there’d be a prison sentence. I checked with my legal team and other attorneys. They thought the worst case scenario would be an eighteen-month sentence. We were offered a two-year plea deal at the beginning of the trial. I had absolutely no warning that the sentence would be as severe as it was.” As he remembered the moment the judge pronounced the sentence, he said, “It was shocking.”
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