Prosecutors aimed to illustrate Michael Jackson's severe financial problems Tuesday, part of an effort to prove the pop star's motive to hold his alleged victim's family hostage.
Jackson was spending $20 million to $30 million more every year than he earns, forensic accountant John Duross O'Bryan testified in the singer's child molestation trial.
"There was an ongoing cash crisis, not enough cash to pay bills," Duross O'Bryan testified.
The prosecution had said it would rest its case Tuesday, but appeared to be behind schedule.
Before the financial testimony, District Attorney Tom Sneddon called sheriff's Sgt. Steve Robel to the stand to undermine the testimony of Jackson's ex-wife Debbie Rowe (search).
Rowe, the mother of two of Jackson's children, had unexpectedly praised Jackson as a good father and a generous and caring friend. She denied prosecution claims that her statements in a video meant to rebut the damaging Martin Bashir documentary on Jackson were scripted by the Jackson camp.
Asked what Rowe said to him in their year-ago interview, Robel said, "She referred to Michael as a sociopath and his children as being possessions."
The detailed analysis of Jackson's multimillion-dollar empire was brought into the trial over vehement objections from defense attorneys who said it was irrelevant to the case and was based on hearsay statements contained in memos from various financial advisers.
Judge Rodney S. Melville (search) instructed jurors that they were not to consider the accounting figures "for the truth of the matter" but merely to show how the expert reached his conclusions.
Under questioning by Deputy District Attorney Gordon Auchincloss, Duross O'Bryan traced Jackson's assets and liabilities from 1999 to 2004.
The witness said he obtained only one balance sheet, from June 30, 2002, and it showed Jackson with a net worth of negative $285 million. He said this included assets of $130 million and liabilities of $415 million.
He said the balance sheet was prepared on a tax basis and assets listed might actually have higher values.
He said he formed his opinions by reading through boxes of memos exchanged by Jackson's financial managers over the years, and he told of a warning to Jackson that if his overspending continued he might be forced to sell off his two greatest assets, the catalogue of his own songs and the Sony-ATV catalogue which contains rights to the works of numerous other artists, including the Beatles.
But the witness said that even selling the catalogues would be problematic because that would incur a huge tax liability.
Defense attorney Thomas Mesereau Jr. (search) said the catalogue was worth $1 billion in 2003, and there have been estimates it's now worth between $4 billion and $5 billion.
Mesereau clashed with the accountant, suggesting in several questions that he underestimated the value of Jackson's stake in the Sony-ATV catalogue and had not considered lucrative offers available to Jackson as an entertainer.
"Wouldn't it be relevant if you knew Mr. Jackson could accept one opportunity and solve (his liquidity problem) in a day?" Mesereau asked.
"If it could be solved, why wasn't it?" the accountant replied.
Duross O'Bryan testified that as of February 2003, the month that the Bashir documentary aired on television, Jackson had $10.5 million in unpaid vendor invoices and only $38,000 in cash in bank accounts.
He also said Jackson owes Bank of America at least $235 million on a loan and a line of credit.
The testimony was offered to show that Jackson was in deep financial trouble when the documentary was aired and brought down a storm of criticism on the star for a statement in which he said he allowed children to sleep in his bed, although he insisted it was non-sexual.
Prosecutors are trying to show that Jackson had banked on the documentary as a way to re-energize his career and that it exploded in his face.
The negative fallout made the pop star frantic, prosecutors contend, driving him to organize efforts at damage control, including recording videos for a program in which his reputation could be salvaged. They maintain he tried to do this by holding captive the family of the boy he allegedly molested and forcing them to participate in the so-called rebuttal video.
The accountant testified he was aware Jackson negotiated with the Fox network to get $7 million for the rebuttal video.
"Let's say he has the opportunity to make a documentary that will generate $7 million," Mesereau said. "That $7 million is not going to make much of a difference" in Jackson's liabilities.
"No, it's not," the witness agreed.
"And it wouldn't be worth committing a crime, would it?" asked Mesereau.
The question was ruled argumentative and there was no answer.
Jackson, 46, is accused of molesting a 13-year-old boy at his Neverland ranch in February or March 2003, giving him alcohol and conspiring to hold the accuser's family captive to get them to rebut the documentary.
The Associated Press contributed to this report.