Dra­bin­sky has been pun­ished enough, lawyer says

The Hamilton Spectator - - BUSINESS - LINDA NGUYEN

Garth Dra­bin­sky has paid his debt to so­ci­ety and shouldn’t be pun­ished again for his role in the Livent En­ter­tain­ment fraud scan­dal, his lawyer said Wed­nes­day as On­tario’s se­cu­ri­ties reg­u­la­tor be­gan open­ing sub­mis­sions in its long-run­ning case against the dis­graced theatre mogul.

Dra­bin­sky, who has a vis­i­ble limp and was us­ing a walker, de­clined to comment on his way into the hear­ing room at the On­tario Se­cu­ri­ties Com­mis­sion, which launched its reg­u­la­tory cases against him and two Livent ex­ec­u­tives in 2001. Those cases were put on hold while crim­i­nal charges against the three worked their way through the courts.

“The gen­tle­man that is sit­ting in this room to­day is not the gen­tle­man you heard about in the course of those pro­ceed­ings,” lawyer Richard Shek­ter told the OSC’s three-mem­ber panel.

“He has ac­knowl­edged cul­pa­bil­ity, he feels ter­ri­ble about what he did and he has made it his life mis­sion to fix it and to con­trib­ute to Cana­dian so­ci­ety.”

Dra­bin­sky, whose fame grew af­ter pro­duc­ing hits such as “The Phan­tom of the Opera,” “Joseph and the Amaz­ing Tech­ni­color Dream­coat” and “Show Boat” was found guilty of two counts of fraud in 2009 and sen­tenced to a four-year prison term for his role in a kick­back scheme that cost in­vestors an es­ti­mated $500 mil­lion. “He has served hard time,” Shek­ter said. The OSC is seek­ing to ban Dra­bin­sky from act­ing as a di­rec­tor or of­fi­cer of a pub­lic com­pany and act­ing as or be­com­ing a reg­is­trant in On­tario.

Pamela Foy, se­nior lit­i­ga­tion coun­sel with the OSC, told the hear­ing that Dra­bin­sky is “not the vic­tim” and that the pur­pose of the sanc­tions is to pro­tect in­vestors and cap­i­tal mar­kets as well as de­ter oth­ers from com­mit­ting sim­i­lar crimes.

She said a ban would not im­pede Dra­bin­sky’s abil­ity to earn a liv­ing as Shek­ter sug­gested be­cause he can work as an em­ployee. Dra­bin­sky is al­ready work­ing on a new mu­si­cal, “Sousatzka,” which de­buts Satur­day in Toronto.

But Shek­ter told the panel such penal­ties would be “un­mit­i­gated overkill” and Dra­bin­sky should be per­mit­ted to trade his own in­vest­ments and run a fam­ily com­pany that would help him min­i­mize taxes and pre­pare es­tate plan­ning.

“You don’t have to be a ge­nius to un­der­stand that what hap­pened to Mr. Dra­bin­sky is more of a de­ter­rent, both per­sonal and gen­eral, than any­thing this panel can im­pose,” he said.

Shek­ter plans on call­ing seven wit­nesses to tes­tify on Dra­bin­sky’s be­half, in­clud­ing Geoff Beat­tie, who pre­vi­ously man­aged pri­vate hold­ing com­pany Woodbridge; Richard Sturs­berg, for­mer head of English lan­guage ser­vices at the CBC; and for­mer fed­eral Court of Ap­peal jus­tice Allen Lin­den.

Two dozen let­ters from var­i­ous sup­port­ers in­clud­ing Onex Corp. founder Ger­ald Schwartz and Four Sea­sons founder Isadore Sharp will also be sub­mit­ted to the panel, Shek­ter said.

Two other men were also charged and con­victed in the Livent scan­dal.

Gor­don Eck­stein, who was the vice-pres­i­dent of fi­nance at the theatre pro­duc­tion com­pany, pleaded guilty in 2007 to fraud. He was given a con­di­tional sen­tence of two years less a day, in­clud­ing a year of house ar­rest.

My­ron Got­tlieb, who co-founded Livent along with Dra­bin­sky, was con­victed of fraud, sen­tenced to five years in prison and re­leased on pa­role in 2012.

Dra­bin­sky ar­rives at hear­ing.

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