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Michael Hiltzik: Nicholas Agonistes

July 17, 2010 |  2:23 pm

The collapse of the federal cases against Henry T. Nicholas and other executives of Broadcom is only one of the many high-profile debacles attributed to prosecutorial misconduct in the last year or two.

As my Sunday column reports, the need to rein in bad habits learned in the post-9/11 anything-goes atmosphere prompted Atty. Gen. Eric Holder to order up new pretrial guidelines for prosecutors, codified in a memo by then-deputy Atty. Gen. David Ogden. 

The cases that have drawn federal judges' wrath make fascinating but depressing reading. For example, here is Judge Ricardo Urbina's blistering opinion in the Blackwater case. On the other side of the coin, not every defendant can win on a prosecutorial misconduct claim. Former KB Homes CEO Bruce Karatz tried it to win dismissal of his own criminal case, also involving backdated options. Federal Judge Otis Young slapped him down in this ruling, and Karatz was convicted on four felony counts in April.

The column begins below.

Connoisseurs of salacious gossip about the rich and famous must have found themselves in pig heaven in June 2008, when federal prosecutors went after the billionaire Henry T. Nicholas III.

The indictment charging that he was part of a huge stock option manipulation scheme at Broadcom Corp., the Irvine high-tech company he co-founded, was only the beginning.

The lagniappe was a second indictment related to his personal lifestyle: allegations of his purchases of illegal drugs and his hiring of prostitutes on a heroic scale, his construction of an underground drug den, his consumption of marijuana in such volume that the pilot flying Nicholas and his entourage aboard a private jet to Las Vegas had to don an oxygen mask.

A year and a half later, the whole federal case had gone to hell.

Read the whole column.

-Michael Hiltzik

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