Tyco Defense Gets Edge After Mistrial

The mistrial of two former Tyco International Ltd. (TYC) executives on Friday gives the defendants the important advantage of knowing the testimony against them before they build their next strategy, legal experts said.

Although former Tyco Chairman Dennis Kozlowski (search) and ex-finance chief Mark Swartz (search) still face a tough fight in a second trial, the experts said information that the defense team gleaned from the first proceeding gives them a new edge.

"It does give an advantage to the defense," said Abraham Abramovsky, a Fordham University Law School professor. "The witnesses testimony is frozen. Any variance at a futt could be called into question.

He said defense lawyers can now "go over chapter and verse" the testimony given during the six-month-long trial and try to raise reasonable doubt about witnesses' statements when they return to the stand.

On Friday a New York judge granted a mistrial on the 12th day of jury deliberations in the case against Kozlowski and Swartz, who were accused of looting the conglomerate of $600 million in one of the biggest corporate corruption cases in U.S. history.

State Supreme Court Judge Michael Obus ended the case after after an apparent holdout juror received a threatening letter. New York's district attorney vowed to retry the case at the earliest opportunity.

The case drew wide public attention as testimony revealed Kozlowski's lavish spending. Jurors heard he paid $5 million for a diamond ring, $6,000 for a shower curtain and $2 million to fete his wife in Sardinia, Italy, for her 40th birthday.

Although 11 of the 12 panelists ended up favoring conviction, some experts had warned during the trial that the state might lose because the case was too long and complicated.

Michael Connolly, a partner with Mintz Levin, said that while the defense has the advantage of having a preview of the government's case, the state now has the opportunity to streamline its side of the trial.

"I think a fair amount of overkill played into the defense's hands," Connolly said. However, he pointed out that even with the trial's complexities, the state came close to winning. In the next round, he said, there might not be another holdout.

But Ivan Fisher, a prominent criminal defense lawyer, said the mistrial has given the defense team the powerful weapon of knowing the other side's hand. In the first trial, he said, the defense gave little away as Kozlowski put on no witnesses and Swartz only one, himself.

"They (defense) can now put on a more compelling case," Fisher said.

Defense attorneys had pressed all week for a mistrial, arguing that media exposure of one juror prevented the panel from reaching a fair verdict.

The 32-count indictment against the former Tyco executives accused them of an array of charges of securities fraud, grand larceny and corruption.

Prosecutors said the men illegally used Tyco as their personal piggy bank, but defense attorneys said all payments to the men were approved by the company.

Kozlowski and Swartz built Tyco into one of the world's largest conglomerates by acquiring hundreds of companies in industries such as plastics, valve making and printed circuit boards.