The federal judge overseeing the Paul Manafort trial took another shot at special counsel Robert Mueller’s team Thursday afternoon, even after conceding earlier in the day that a criticism he leveled at prosecutors on Wednesday was erroneous.
The prosecution spent about 40 minutes Thursday afternoon questioning a bank employee about Manafort’s unsuccessful effort to get a $5.5 million construction loan on a Brooklyn brownstone, only to have Judge T.S. Ellis III suggest that the issue was unworthy of such extensive discussion at the trial. Notably, Ellis made the remark with the jury present.
“You might want to spend time on a loan that was granted,” the judge scoffed as prosecutor Uzo Asonye sat down after concluding his questioning of Citizens Bank employee Taryn Rodriguez.
That prompted Asonye, who had sat down, to jump back up.
“Your honor, this is a charged count in the indictment,” the prosecutor said.
“I know that,” Ellis shot back.
The tense exchange was just the latest example of Ellis making comments that could lead jurors to question the prosecution’s case or its tactics in the tax- and bank-fraud trial that opened last week.
Ellis even acknowledged that one of his prior remarks was out of line, telling the jury early Thursday that he “may well have been wrong” the day before when he slammed the Mueller team for allowing an expert witness from the IRS to remain in the courtroom while other witnesses were testifying.
Typically, witnesses aren’t supposed to hear anyone else’s testimony in a trial so they don’t influence each other, but Mueller’s team got Ellis’ permission during the trial’s opening arguments last week to have the IRS agent in the court on a regular basis.
“This robe doesn’t make me anything other than human,” Ellis told the court on Thursday morning after instructing the jury to forget what he had said to the Mueller team about the IRS witness. “You’ve got to put that aside.”
Mueller’s team has been frustrated by repeated slapdowns from Ellis during the Manafort trial — now in its eighth day. Before court started on Thursday morning, they filed a written motion to formally protest how they had been called out over the IRS witness.
The Mueller team asked Ellis to explain to the jury that the prosecution had done nothing wrong and cited a transcript of the first day of the trial last week showing that prosecutor Uzo Asonye specifically asked that witnesses be excluded “with the exception of our expert and our [FBI] case agent.” The judge and the prosecutor went on to discuss Michael Welch by name and his expertise. And the judge unmistakably approved the exception.
“The Court mistakenly faulted the government for permitting IRS revenue agent Michael Welch, the government’s expert witness, to remain in the courtroom during the proceedings, when in fact on the first day of trial the Court had expressly granted the government’s motion to do so,” prosecutors complained in their motion. “The Court’s reprimand of government counsel suggested to the jury — incorrectly — that the government had acted improperly and in contravention of Court rules. This prejudice should be cured.”
Ellis chastised Asonye in court on Wednesday moments after he called Welch to the stand. “It’s my clear recollection … that I wasn’t admitting experts,” Ellis said. “You need to ask specifically. You’re going to go ahead now, I’m going to permit that, but I want you to remember that.”
Asonye responded that prosecutors would “check the transcript,” but it was their belief that they specifically asked for permission to allow expert witnesses like Welch to remain in the courtroom despite the usual prohibition.
“Well, let me be clear: I don’t care what the transcript says,” Ellis snapped, before backing down a little. “Maybe I made a mistake. But I want you to remember don’t do that again. When I exclude witnesses, I mean everybody. Now, it may be that I didn’t make that clear.”
The judge’s tone suggested he was disturbed by the prosecutors’ actions, although he eventually declared, “It’s not a big deal.”
In their letter, Mueller’s team said that the judge’s action left a “negative impression” of them. “The Court’s sharp reprimand of government counsel in front of the jury on August 8 was…erroneous. And, while mistakes are a natural part of the trial process, the mistake here prejudiced the government,” Mueller’s team wrote, asking Ellis to tell jurors he was mistaken and the prosecution did nothing wrong.
Before the jury came in Thursday but after the session began, Asonye asked Ellis to address the issue. The judge snapped, “Alright, I’m going to take care of that.”
The judge’s slap at the prosecution on Wednesday over the expert witness issue was just the latest in a series of rebukes he’s delivered to Mueller’s squad in recent days over topics ranging from body language to excessive informality to efforts to introduce visual imagery of Manafort’s lavish lifestyle. The prickly exchanges have clearly begun to grate on the prosecution team, which has sometimes protested verbally in court, but did not formally lodge a written objection before Thursday.
On Wednesday, Ellis scolded prosecutor Greg Andres for responding to the court’s questions with terms the judge considered too casual, like “yeah” or “yup.”
“Be careful about that,” he told Andres. “This is not an informal proceeding.”
Andres slipped up again moments later, offering a “yup” in response to another question from the judge.
“I beg your pardon?” Ellis intoned, his irritation evident.
“Yes, judge,” Andres answered.
Ellis has sometimes faulted defense attorneys, but that has been more rare. On the other hand, the prosecution has been doing most of the heavy lifting thus far as the government presents its case. With prosecutors pledging to finish presenting their evidence by the end of the day Friday, the defense’s opportunity to call witnesses should come next week.
Mueller team turns back to bank fraud charges
Prosecutors turned Thursday morning back to the bank fraud charges against Manafort, calling a mortgage assistant who handled his 2015-16 application for a loan on a Manhattan condominium he owned with his wife and one of his daughters.
Melinda James, an assistant at Citizens Bank, testified that Manafort signed documents declaring the Howard Street condo as a second home used as a residence for their daughter Jessica and then-husband Jeffrey Yohai. Manafort also stated that he didn’t have any other mortgages on a wide swath of real estate he owned.
But Mueller’s team noted documents showing Manafort had also filed tax returns declaring the property, located in New York’s SoHo neighborhood, as a rental for 365 days a year that had been listed on Airbnb. Prosecutors also presented insurance and financial documents detailing debts Manafort had on his other properties.
In her testimony, James said that while considering the loan she discovered on the website Streeteasy that the property was available for rent, even though Manafort billed it as a home for his family. She explained that the bank and the loan underwriters would have made different calculations if they believed Manafort was renting out the condo or that he had other mortgages on his properties.
During cross-examination, the defense again pointed the finger at its No. 1 bogeyman, star prosecution witness and former Manafort aide Rick Gates. Defense attorney Jay Nanavati noted that the Citizens Bank loan went through a “months-long application process” and that the individual who sent the bank insurance documents suggesting there were no other outstanding loans was Gates.
Gates also called the bank to assuage doubts about a loan that the bank had flagged as a potential obstacle to mortgaging the Howard Street property, James testified. He told the bank that they were not moving forward with that loan.
“It was not until you got a telephone call from Mr. Gates later that day that things went off the rails, correct?” Nanavati asked.
“I guess — if you call it off the rails,” James said.
Nanavati also noted that even if Manafort’s 2015 and 2016 tax returns displayed the Howard Street property as a rental property for the entirety of those two years, those returns wouldn’t have been filed until after the Howard Street mortgage application Manafort was filed and approved.
However, Asonye pointed out that Manafort was copied on an email where Gates provided the allegedly misleading information saying there was “no mortgagee” on Manafort’s other properties. The prosecutor also suggested it was bizarre to think Gates was unilaterally trying to trick the bank.
“As far as you know, did Mr. Gates received one penny from this cash-out refinancing?” Asonye asked.
“No,” James replied.
“Who got the money?” Asonye asked.
“Mr. Manafort,” James said.
Airbnb’ing Manafort’s condo
Prosecutors also called senior Airbnb executive Darin Evenson to testify that between January 2015 and April 2016 the Howard Street home was available for rent on the popular site, billed as an “Amazing Full Floor Loft in Soho.”
There were a couple of breaks in its availability, though, Evenson said. One involved the apartment coming off the rental site on Feb. 26, 2016, just days before the mortgage went through. The apartment popped back onto the site one month later, the Airbnb official said.
Evenson, a retired Navy Seal, did acknowledge that the company had no indication Manafort himself was ever considered a “host” on the platform. Instead, Manafort’s then-son-in-law, Yohai, was listed as the contact.
Manafort and his wife Kathleen ultimately closed on the $3.4 million loan on March 4, 2016 — less than four weeks before he was named the Trump campaign’s convention manager for the Republican National Convention.