New York, Sept. 24: There is no question that Mark A. Belnick, a star litigator who helped Congress track down missing millions in the Iran-Contra affair, made some costly errors in judgement while he was general counsel at Tyco.
At best, he relied on assurances of the company’s top two executives about his compensation — foolishly, in retrospect; at worst, as Tyco now claims, Belnick is simply a crook.
Tyco says Belnick participated in a grand conspiracy that looted the company of hundreds of millions of dollars. Prosecutors and regulators accuse him of hiding how much money he borrowed from the company.
The accusations have left friends, colleagues and much of the New York legal and business community struggling with whether Belnick went over to the dark side, seduced by money proffered by L. Dennis Kozlowski, Tyco’s hypnotic former chief executive.
Championing Tyco is David Boies, the lawyer who handled the antitrust prosecution of Microsoft and Al Gore’s failed effort to force a recount in the 2000 presidential election. Belnick is represented by Reid Weingarten of the Washington law firm of Steptoe & Johnson, who is also representing WorldCom’s former CEO, Bernard J. Ebbers.
Tyco’s lawsuit paints Belnick as part of a web of impropriety that allowed top executives to steal hundreds of millions of dollars and dole out money to other employees and perhaps even to a member of the board, thereby encouraging others to keep quiet. Tyco wants Belnick to return all the money he was paid while general counsel.
Belnick’s lawyer has a response to every charge brought by Tyco — and indeed to those brought by the Securities and Exchange Commission and New York prosecutors. Weingarten says Belnick lost a power struggle with Boies and some of the company’s directors over who would run the investigation of what happened at the company.
If Belnick were a part of a conspiracy, Weingarten said, his debts would have been forgiven, like those of other recipients of millions of dollars in company loans.