Phase Two in Jackson/Schaffel Civil Trial Set to Begin in Two Weeks – MB#315

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Phase Two in Jackson/Schaffel Civil Trial Set to Begin in Two Weeks – MB#315 JULY 17 2006 – A split verdict in the Schaffel v Jackson / Jackson v Schaffel civil trial came down Friday (July 14). The jury awarded Schaffel $900,000 and Jackson $200,000. Before this lawsuit, Michael Jackson’s financial managers found that Schaffel had yet to be paid roughly $472,000 for his cut from the profits of two Jackson specials which aired in Fox in Feb 2003. Many observer of the trial were on the verge of being completely stunned that Schaffel would get a dime over the approx. $500,000 he was initially owed considering the evidence presented by Jackson’s attorney, Thomas Mundell, detailing what looked like Schaffel’s numerous financial illegalities. The Judge split the case up into two phases. As it turns out, only one of Jackson’s claims against Schaffel was heard by the jury in the first phase. The rest of Jackson’s claims for damages are scheduled to be heard in approx 2 weeks by the Judge during the accounting phase. According to Jackson spokesperson and General Manager, Raymone Bain, Schaffel was offered what he was owed before the trial. But Schaffel didn’t want that. Instead, he wanted $6 Million initially. Needless to say, Jackson said hell no to making Schaffel the $6 Million man. Schaffel filed a lawsuit. Jackson’s lawyers brought in a forensic accountant to go through all of the financial dealings with Schaffel. What they found is that Jackson, not Schaffel, was the one who was owed money based on shady actions taken by the “ex-leech” during his employ for the megastar. Consequently, Jackson filed a counter-suit. When the jury’s verdict was announced Friday, we all thought that was the end of the case. However, the case itself isn’t over. Jackson’s attorney plan to convince the Judge in the case to rule in his client’s favor during the second phase of the trial based on the documentation they have of Schaffel’s financial misdeeds. A press release from Bain confirms that the remaining claims yet to be heard by the Judge exceed the amount Schaffel was awarded by the jury. The following statement was released after the verdict Friday:

In round 1, the jury awarded Mr. Schaffel $900,000. However, the jury also awarded Mr. Jackson $200,000, plus interest, for Mr. Schaffel’s fraud, conversion and breach of fiduciary duty. Says Tom Mundell, Lead Defense Counsel, “This was a great result for Michael. The judge divided the trial into two phases. In this first phase, the jury heard all of Schaffel’s claims and one of Michael’s claims. In about two weeks, the judge will hear testimony on the rest of Michael’s claims against Schaffel. The value of Michael’s remaining claims exceeds the small net amount in Schaffel’s favor from Phase 1 of the trial, and we are confident that when Phase 2 is concluded, the overall judgment will be in Michael’s favor.” (see Jackson Spokesperson Releases Statement – July 14 2006)

Considering Schaffel was originally trying to get $6 Million dollars from Jackson, the $700,000 (900,000-200,000) Schaffel has been awarded so far is paltry. And he still has to pay his lawyer, Howard King…unless he tries to stiff him too. __ “I was like ‘what the hell?’ “__ What is probably the most disturbing part of the trial are some of the comments made by certain jury members after they rendered their verdict. A few of them thought Jackson was a child molester and used unfounded, sketchy innuendo from Schaffel, with zero evidence, to give Schaffel an extra $300,000 he seemingly doesn’t deserve. Unlike in criminal cases, only 9 jurors have to agree on a particular verdict. To quote from one of many email response we’ve gotten about the issue thus far, “When I heard about the jury verdict I was like ‘what the hell?’ ” That sentiment isn’t lost on me. Jurors say they fought over the issue of Schaffel claiming he delivered $300,000 to a phantom ‘Mr. X’ in Argentina. At least one juror and the jury foreman said they were “disturbed” by the claim and believed “something unpleasant” happened but that they didn’t want to know about it (see Jackson lawsuit jury awards money to ex-associate and pop star). Now remember, there was no evidence of this claim other than Schaffel’s word. There were no financial transactions from any of Schaffel’s accounts to substantiate the claim, as testified to by the forensic accountant, reports the AP. There was no corroboration from other witnesses as to what Schaffel actually did in Argentina or when he did it…or if he even went there on Jackson’s behalf to do anything in the first place. Schaffel didn’t even provide the jury with the name of this alleged person, their age, or what the money was supposedly for. He also provided different stories as to why he was in South America to begin with. He claimed he was in South America to deliver $300,000 to ‘Mr. X’. Then he claimed he was there to help Jackson adopt some kids. Never did find out which version of the story he finally stuck to. There was also a discrepancy as to where he got that money. He claimed he got it out of a Brazilian bank account. Then he claimed he already had it in a safe. Never did find out which version of that story he finally stuck to either. But these jurors “believed something happened” because they wanted to believe something happened. They already thought Jackson was a child molester. And to many, it appears as if they awarded Schaffel money based on his shady, half-assed allegation because it fit with their preconceived notion about Jackson’s character. The only problem with that is that jurors are supposed to follow the law and base their verdicts on the evidence presented at trial. I guess the type of substantial evidence presented by the forensic accountant and the documentation wasn’t enough to conquer the fears and suspicions of those who really couldn’t care less other than looking for a reason to punish Jackson for some imagined wrong they think he’s done. I wouldn’t be surprised to see someone accuse Jackson of practicing witchcraft. Ah, good ole’ 1692. Good times, man! Good times. Aside from being a dangerous precedent, the verdict is also infuriating to some Jackson supporters who see the comments from a few jurors as a slap in the face to the superstar, especially after they were made well aware of Schaffel’s financial wrongdoings. It essentially didn’t matter that the facts showed no substantiation of the $300,000 claim. Extrapolated, it means it didn’t matter to them that Jackson was acquitted on all counts last year or that accusations from 1993 were all but demolished – as much as they could be without the 1993 accuser, Jordan Chandler, being subjected to cross-examination. According to press reports, the jurors who felt uneasy about Jackson also admitted Schaffel wasn’t such a credible witness. So some observers, myself included, are still baffled as to the logic behind their verdict. On the flipside, at least three jurors wanted to award Jackson more money and flat-out said they believed Jackson was a “victim of exploitation”. Two of them didn’t want to give their names and the other gushed about the charity song after hearing it. She, Cathleen Yancey, said there was at least one juror that was totally adamant in their opinion against Jackson. From the report:

Two jurors who refused to give their names said in interviews that they felt Jackson was a victim of exploitation by Schaffel and that he should have been awarded more money. … Yancey, a student at Brigham Young University, said she wanted to award Jackson more than the $200,000 but that one of the jurors was adamant ”and was the most opinionated.”(see Jackson lawsuit jury awards money to ex-associate and pop star)

If the adamant juror mentioned by Yancey was also the foreman, or if they agreed with the foreman, it’s not difficult to understand why they would believe Schaffel’s unfounded claim. What’s also peculiar is that some jurors asked if they could see the video for the charity song “What More Can I Give”; the same song which has been tied up by Schaffel’s side-dealings and this civil suit Of the song, Yancey told the Associated Press, “It’s so great. I think it should be out. There’s a lot that would have to happen for it to be released. But I think it should be out” (see Jackson lawsuit jury awards money to ex-associate and pop star). Yeah, no kidding. __Monies yet to be paid?__ The accounting phase of the civil trial is coming up soon. Information about the transactions of Schaffel will be further delved into. The forensic accountant discovered numerous instances where Schaffel had taken money out of a business account created around the charity song ‘What More Can I Give’, and put into his own personal accounts. One of the claims alleged by Schaffel is that he gave Jackson $500,000 after the Sept 11 attacks in 2001 when Jackson supposedly showed up in front of his house in a bus with his family. Jackson flat out denied this allegation. The public learned from a 2002 Vibe Magazine interview, he and his family were in New Jersey after the Sept 11 attacks (see Vibe Mag: MJ Interview (March 2002)). Jan Goren, the forensic accountant charged with investigation Schaffel’s many financial transactions, testified that Schaffel’s claim is unsubstantiated. According to his findings, the supposed $500,000 was simply transferred by Schaffel from one account to another. It wasn’t given as cash to anyone. In fact, Schaffel took that half a million dollars out of the Neverland Valley Entertainment business account and put it into his own personal money market account. Jackson’s attorneys showed jurors checks and documents of the transaction, according to the Associated Press (AP). Despite ridiculous comments by two jurors after the verdict, the forensic accountant also found numerous false claims Schaffel made for money. One such claim was the mysterious $300,000 to a phantom ‘Mr. X’ in Argentina mentioned earlier. From the AP article dated July 12 titled “Forensic accountant challenges plaintiff’s claims against Jackson”:

Jan Goren, who showed jurors how he traced millions of dollars through the various bank accounts of F. Marc Schaffel, also said he found no substantiation for a $300,000 payment Schaffel claimed he provided to a mysterious “Mr. X” in South America on Jackson’s behalf. (see Forensic accountant challenges plaintiff’s claims against Jackson)

As first mentioned in MJEOL Bullet #314, Goren confirmed that “there is no check, no moneys leaving a bank…no bank statements, no ledgers” showing this $300,000 anywhere. He went on to say, “My conclusion on this is it is not a valid claim” (see Forensic accountant challenges plaintiff’s claims against Jackson). When you hate ‘Jacko’, who the hell needs a VALID claim? Ok, I’ll cut the sarcasm right now. Moving on. Probably one of the most egregious issues (as if they all aren’t) revolve around the issue of Schaffel backdating checks to get money out of the NVE business account AFTER he was fired. Schaffel admitted he received a letter of termination Nov 15 2001. So what did he do? He backdated at least 18 different checks to get money out of the NVE business account for his own selfish reasons; like to pay his rent, utilities and lord knows what else he used the money on. The sum he was alleged to have siphoned was over $750,000. Schaffel would only cop to about $200,000 of that, according to reports. And when confronted with evidence by Jackson’s attorney, he claimed Jackson was going to pay his rent and utilities for 6 months anyway. Yeah right. That would be like an ex-employee of a bank robbing the place, getting caught, then claiming his employer was going to give him a raise before he got fired, so he went ahead and took the money. Another area in Jackson’s case concerned Schaffel side-dealing to get hundreds of thousands of dollars by selling the rights to the charity song ‘What More Can I Give’; rights he didn’t own, nor had permission to do anything with. The Japanese company reportedly scammed by Schaffel, Music Fighters, wired the money into the NVE business account. After which, Schaffel promptly transferred the money from the business account to his own bank account according to reports. He used it as a down payment for his million dollar house in Calabasas, California. The problem with that is he made a pesky little agreement to make sure that any proceeds generated from anything related to the charity song be for charity only. I guess he can claim he was donating to the ‘Schaffel Salvation Army’…or the ‘Church of St. Schaffel’…based in a million dollar house in Calabasas…it only costs a hundred dollars and one betrayed friend to join. As for the trial, it gives new meaning to the phrase ‘it ain’t over ‘til the fat lady sings’. In Schaffel’s situation, I suppose ‘it ain’t over ‘til the fat man cries’. Maybe he can flee to South America…in a hot air balloon…and live with ‘Mr. X’ and the Latinboys…until he can find someone else to betray. And maybe he’ll take those paranoid, know-nothing jurors with him. Stay tuned. -MJEOL

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