Judge rejects prosecution witnesses in McCullough theft trial

Prosecutors trying former Allegheny County Councilman Charles McCullough took a hit Wednesday when the judge hearing his criminal case ruled that two expert witnesses they wanted to call could not testify.

Common Pleas Senior Judge Lester G. Nauhaus said that neither of the experts the prosecution called had any more knowledge on the issues before him than he did. Therefore, it was up to the court to make a decision on Mr. McCullough’s actions, and not the witnesses.

Mr. McCullough is charged with 23 counts, including theft and misappropriation of funds, in his handling of a trust account for an elderly widow named Shirley Jordan, who had accumulated about $14 million.

The prosecution has alleged that Mr. McCullough used Ms. Jordan’s money for his benefit while he served as her power of attorney and co-trustee in 2006 and 2007. The judge drew a distinction between poor financial management and criminal actions.

“He may well be a crummy lawyer,”Judge Nauhaus said. “It doesn’t make him a criminal.”

Assistant district attorney Aaron McKendry on Wednesday called to the stand an estates and trust lawyer who reviewed the Jordan trust to testify as an expert about how her affairs were handled.

Martin Hagan told Judge Nauhaus that the foundation Mr. McCullough created in Ms. Jordan’s name was not the best way to handle her money. Instead, he suggested, her funds should have gone into a charity remainder trust.

But Judge Nauhaus stopped him.

“I believe there’s a difference between criminal activity and malpractice,” he said. “It may well be Mr. McCullough committed malpractice. You need to show me there’s fraud involved in choosing the charitable foundation.”

Mr. McKendry argued that Ms. Jordan’s foundation wasn’t supposed to be created until after the woman died, and therefore, by the foundation’s early

creation, Mr. McCullough abused his position.

“It was criminal when it’s not what Shirley Jordan wanted and not what Shirley Jordan authorized,” added assistant district attorney John Fitzgerald.

But Judge Nauhaus countered that the prosecution had not presented any evidence showing Ms. Jordan disagreed with the creation of the foundation. He noted, too, there has been no evidence showing whether the woman was incapacitated. Later in the day, Mr. Fitzgerald noted that Ms. Jordan was not declared to be incompetent until 2008 — after the allegations at issue in the case.

Next, Mr. McKendry attempted to call investigator Kevin Flanigan, who reviewed law firm billing statements, also to testify as an expert.

Again, Judge Nauhaus cut him off, telling him that he could read the bills the same as Mr. Flanigan. When Mr. McKendry tried to argue that the billing amounts were too high, and showed Mr. McCullough was benefiting, the judge interrupted.

“The fact that it’s exorbitant is not a crime,” Judge Nauhaus said. “In order for it to be theft, as far as I’m concerned, he has to be lining his own pocket. Show me something he benefited from.”

The investigation of Mr. McCullough began after the Post-Gazette reported in April 2007 that Ms. Jordan had donated $10,000 to each of five political candidates, and that she didn’t approve the checks. They were handed out by Mr. McCullough.

Judge Nauhaus noted during discussion on the issues that he was not referring to those five checks in his criticism of the case.

“I can understand your theory with the five checks perfectly,” he said. “I don’t understand your theory with everything else.”

The trial is now on hold until May 8 based on scheduling issues. Prosecutors told Judge Nauhaus they have only one witness left — and possibly will recall another — before they rest their case.