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Q&A: Latham's Sean Berkowitz on winning acquittal in accounting fraud case

3 minute read

Signage on the exterior of the building where law firm Latham & Watkins LLP is located in Manhattan, New York City, U.S., August 17, 2020. REUTERS/Andrew Kelly

(Reuters) - Defendants facing federal fraud charges rarely go to trial –fewer still are acquitted – but an engine company executive accused of a multi-million dollar accounting fraud is now among them.

Sean Berkowitz, the global chair of Latham & Watkins' complex commercial litigation practice, represented Power Solutions International Inc founder Gary Winemaster in a four-week criminal trial earlier this summer. Prosecutors had accused the former CEO of causing PSI to overstate its revenue by millions of dollars through what they said were fraudulent sales.

On Sept. 20, U.S. District Judge Robert Gettleman in Chicago found Winemaster and two co-defendants, represented by Burke Burns & Pinelli and McGuireWoods, not guilty on all counts.

Berkowitz recently spoke with Reuters about trying the case before a judge instead of a jury, and his client's unusual decision to take the stand.

This conversation has been edited for clarity and length.

REUTERS: Fraud defendants fare better at bench trials than jury trials. Why are there so few?

BERKOWITZ: Both the prosecution and the defendant need to agree, which rarely happens. The U.S. Attorney's Office in Chicago, as a matter of policy, doesn't agree to bench trials. The judge also needs to agree.

REUTERS: Why a bench trial in this case?

BERKOWITZ: Largely because of COVID and the uncertainty about when Mr. Winemaster could get a trial date. He wanted to exercise his right to a speedy trial and because of the suspension of jury trials, we weren't able to get that done.

REUTERS: What was challenging about this trial?

BERKOWITZ: The government had over 20 witnesses. They had access to an unlimited amount of resources. The company had acknowledged certain facts that implicated my client in wrongdoing, and so we had an uphill battle.

REUTERS: How did you defuse that evidence?

BERKOWITZ: We did it brick by brick for eight transactions, each of which were complicated in their own right. As you would expect in any situation, there were emails that could be read in a number of different ways, and the way that we approached it was to attack each transaction and provide context around it.

REUTERS: It's unusual for a defendant to take the stand. Why did your client?

BERKOWITZ: My client has a forceful personality and I don't think, even if we didn't want him to testify, we could have kept him off the stand. He's been wanting to tell his story for years and this was his opportunity.

REUTERS: Anything else you would say about the trial?

BERKOWITZ: It is rare to have a federal criminal trial, and it is even more rare for young lawyers to get the experience that they got in this case. It was a great team effort, which you need in a case that is this sprawling and large.

Jody Godoy reports on banking and securities law. Reach her at jody.godoy@thomsonreuters.com

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