Sizemore Trial Archive

The Oregonian Cover Story: "Oregon tax activist Sizemore's spending clashes with law" Follow Racketeer Bill's money from his charities to his pockets! Date: 10/21/2008 Supreme Court Confirms Sizemore as Racketeer Court upholds multi-million dollar jury award NEWS RELEASE July 3, 2008 Salem - This morning, the Oregon Supreme Court unanimously upheld a lower court ruling confirming that Bill Sizemore engaged in fraud, forgery and racketeering in the signature gathering process. Sizemore’s organizations remain liable for a multi-million dollar jury award owed to tens of thousands of Oregon school employees. Additionally, the High Court confirmed the lower court’s finding that Sizemore ran a sham charity organization. Today’s ruling came after repeated efforts by Sizemore to avoid the $2.5-million judgment issued against his organizations by a Multnomah County jury in 2002. “It’s the end of the road for Bill Sizemore and his failed attempts to avoid justice,” says Larry Wolf, OEA President. “The Supreme Court has the final word and they have confirmed what we’ve known for years – Bill Sizemore is a racketeer who uses fraud and forgery to manipulate Oregon’s initiative system. Oregon voters should be very suspicious of any measure he puts forward now and in the future.” In 2002, the jury found that Mr. Sizemore had engaged in racketeering, fraud and forgery during the signature gathering process and a final judgment of approximately $2.5-million was entered against Mr. Sizemore’s organizations. The 2002 ruling originated from lawsuits filed by the Oregon Education Association (OEA) and American Federation of Teachers-Oregon (AFT-Oregon). In 2003, the court also entered an injunction limiting Mr. Sizemore’s ability to utilize the assets of those organizations. In 2006, the Court of Appeals denied Sizemore’s attempt to overturn the jury ruling and affirmed that his organization engaged in a “calculated course of criminal conduct” and “cynical, criminal manipulation of the democratic process.” Today, the Supreme Court affirmed the Court of Appeals findings. “Our goal has always been to defend the initiative process,” says Richard Schwarz, AFT Executive Director. “The day before our country celebrates the birth of American democracy, the Supreme Court has ruled that Bill Sizemore cannot abuse the democratic process and get away with it. It’s not a game.” On a related note, earlier this year Multnomah County Judge Janice Wilson ruled that racketeer Bill Sizemore willfully violated the 2003 court injunction against transferring funds from successor political committees for his political activities. In the May 2008 ruling, Judge Wilson rejected claims by Sizemore that he didn’t understand the injunction placed against him, ruling instead that he “chose to ignore” the court order by transferring assets out of his organizations for political activities. Read the full text of the Oregon Supreme Court's Ruling.   Date: 7/3/2008 FOR MORE INFORMATION CONTACT: Becca Uherbelau, 503-495-2119           NEWS RELEASE May 27, 2008 Portland – This morning, Multnomah County Judge Janice Wilson ruled that racketeer Bill Sizemore willfully violated a 2003 court injunction against moving funds around to pay for his political activities. Judge Wilson rejected claims by Sizemore that he didn’t understand the injunction placed against him, ruling instead that he “chose to ignore” the court order by transferring assets out of his organizations for political activities. In 2002, a Multnomah County jury found that Mr. Sizemore had engaged in racketeering, fraud and forgery during the signature gathering process and a final judgment of approximately $3.5 million was entered against Mr. Sizemore’s organizations. In 2003, the court also entered an injunction limiting Mr. Sizemore’s ability to utilize the assets of those organizations. Under the 2003 court order, Sizemore was prohibited from transferring assets out of his political committees until he paid off a trial court judgment to the Oregon Education Association and the American Federation of Teachers-Oregon. Instead, he has continued doing business under a new name, and used funds to pay for signature gathering operations. Judge Wilson found that both the Oregon Taxpayers Union and the chief petitioner committee for initiative petition 61 were successor organizations, and that the 2003 injunction applied to them. “Bill Sizemore’s continued attempts to turn Oregon elections into his own private shell game are finally catching up with him,” says Richard Schwarz, Executive Director of AFT-Oregon. “With this ruling, he should finally get the message that he can no longer play fast and loose with court orders and Oregon law.” As a result of today’s ruling, Sizemore will be forced to pay OEA and AFT-Oregon the same amount of money that he transferred out of his organizations. He is also on the hook for plaintiffs’ costs and attorneys fees. “Once again, Bill Sizemore is reminded that he must follow the law - like any other Oregonian,” says Gail Rasmussen, OEA Vice President. “We hope this ruling ends Sizemore’s long history of thinking and acting like he’s above the law.” The decision is just the latest in a long list of court orders against Sizemore’s attempts to circumvent the law. In February, attorneys for OEA and AFT-Oregon filed a fourth contempt charge, asserting that Sizemore fraudulently used a sham charitable organization to funnel money into his political activities—the same illegal practices that put him on the wrong side of the law in the first place. ###   Date: 5/27/2008 FAQ on Sizemore ruling: Why is Sizemore able to continue to avoid justice and file ballot measures? The courts did not prohibit Sizemore from engaging in political activities, so he continues to do so. He is, however, under court injunction against violating signature gathering laws, among other things. The injunction also prohibits Sizemore from raising and spending money through a PAC until the judgment is paid off. (no new paragraph), OEA and AFT have pending motions for contempt against Sizemore for violating this court injunction by raising and spending money through a political PAC. On a related note, OEA and AFT-Oregon continue to pursue payment of the original judgment while Sizemore continues to plead poverty claiming that he has no income or assets. However during court proceedings last year, Bill Sizemore disclosed information about his income and household finances in which he admitted that the Americans for Tax Research Foundation has been paying CBS Consulting, a firm operating under Cindy Sizemore’s name, $7,500 a month to design a website. ATRF is Cindy Sizemore’s only client. Additionally, ATRF has paid $2,500 a month for rent for the Sizemore family residence and additional amounts for a family vehicle, office space and equipment. Mr. Sizemore is legally obligated to pay the amounts owed to OEA and AFT, but he has consistently claimed he has little to no income. Mr. Sizemore has disclosed, however, that he receives $1,000 a month from his wife. Sizemore and his family are currently living in Klamath Falls. What is the status of the Sizemore case? The current status is that Bill Sizemore’s Education Foundation owes the Oregon Education Association (OEA) and American Federation of Teachers/Oregon (AFT-Oregon), more than $2.5 million in damages and nearly $1 million in attorney fees. Sizemore continues his attempts to appeal the judgment and overturn the verdict of a Multnomah County jury in 2002 that ruled his organization engaged in criminal racketeering, forgery, and fraud. The Oregon Supreme Court heard oral arguments on Sizemore’s appeal on September 10, 2007. In addition to the original case involving Sizemore and his Education Foundation, OEA and AFT-Oregon have pursued legal action against Sizemore personally. Sizemore has been held in contempt for violating the court’s injunction and the court awarded OEA and AFT a total of $125,000 to reimburse them for the attorney fees and costs necessary to bring the contempt action. Sizemore has now paid that amount to OEA and AFT. In 2007, OEA & AFT filed a new lawsuit against Bill Sizemore, his wife Cindy, and Nevada-based Americans for Tax Research Foundation (ATRF) for fraudulent transfer of funds and civil conspiracy. The lawsuit is based on evidence of the illegal transfer of funds among the defendants named in the suit and evidence of a conspiracy to defraud the plaintiffs. There is no question that it was the filing of this suit which compelled Sizemore to pay the $125,000 in attorney fees which had been awarded against him. OEA and AFT have filed a motion to hold Bill Sizemore in contempt for using funds from a charitable organization for political purposes. The contempt claim stems from evidence gathered during court proceedings in which Mr. Sizemore admitted that the Nevada-based Americans for Tax Research Foundation (ATRF) has been supporting the Sizemore household. This allows Mr. Sizemore to continue his work on ballot initiatives. This violates the court’s order which prohibits Sizemore from organizing a charitable organization and then using funds from that organization for political purposes. Sizemore insists that he's "winning." How can he make that claim? This is a very complicated set of cases, which makes it easy for Sizemore to spin straw into gold when talking to reporters. It should come as no surprise to anyone that Bill Sizemore continues to manipulate the truth in order to make himself look better. Sizemore used numerous organizations and worked very hard to hide his political activities. He created a complicated web that the courts and the lawyers are still working to unravel. But the fact remains that the original jury ruling of 2002 against Bill Sizemore's scheme stands. In October 2006, the Oregon Court of Appeals substantially upheld that ruling, stating in clear and unequivocal terms that the case is about Bill Sizemore's fraud, money laundering, and his "cynical, criminal manipulation of the democratic process." That doesn't sound like the court is siding with Sizemore. What happened when Sizemore appealed the original ruling? Did he win? No. In October 2006, the court rejected Sizemore’s first appeal to reverse the jury decision with one exception. The court reversed the lower court ruling regarding Sizemore’s intentional falsification of contribution and expenditure reports through his political action committee (Oregon Taxpayers United PAC) because it was not technically a violation of the criminal statute that the plaintiffs relied on. Nevertheless, the court upheld the $2.5 million jury verdict against Sizemore’s education foundation. Claiming this as a victory is simply a continuation of the cynical manipulation that the Court of Appeals noted to be Sizemore’s way of doing business. Let me get this straight - you're saying that Sizemore's conduct in connection to the political action committee was so egregious that the law didn't fit? That's right. This is the one area in which OEA and AFT-Oregon disagree with the court. The court ruled that while Sizemore's PAC did engage in intentional falsification of contribution and expenditure reports, current criminal law is not sufficiently broad enough to capture this misconduct and, therefore, the court had to amend the judgments against Oregon Taxpayers United PAC. We believe the law is broad enough, and filed a motion to reconsider on this point. But in December 2006, the Court of Appeals stuck by its original interpretation. Nevertheless, the Oregon Taxpayers United PAC remains liable for about $300,000 that the jury and court awarded to OEA and AFT/Oregon related to the racketeering activity in connection with falsifying signatures in the initial process of qualifying Measure 98. The judgment against the Oregon Taxpayers' United Education Foundation stands. What's the difference between the "Education Foundation" and the "Political Action Committee"? Both organizations were run by Sizemore for political purposes during the height of his initiative activities. For honest organizations, the political action committee runs political activities and, as such, has legal reporting and disclosure requirements about who contributes and what the money pays for. This is how voters get information about who is involved in ballot measures and who supports candidates. Charities like the "Education Foundation" operate under a different set of rules and reporting requirements and there are legal limits as to how much and what type of political work they can engage in. Also - and this is important for the fraud Sizemore perpetuated - contributors' names and contribution amounts are kept confidential. Evidence presented in the 2002 Sizemore trial made it clear that Sizemore blatantly ignored these laws and merged his organizations in order to hide money and mislead donors and the public. Refresh my memory - how was it proven that Sizemore ran fraudulent organizations? In the trial, former Sizemore employee Becky Miller testified that many charitable or educational "accomplishments" listed on the education foundation's legally required financial reports never occurred. She testified that on two occasions she had to manufacture materials because The Oregonian newspaper was demanding to see them. She testified that real records were rarely kept and that while she and other employees were listed as working for the educational foundation, in reality they spent 75 percent of their time on political activities. She testified that during her employment with the foundation, she also worked on Sizemore's 1998 campaign for governor, which is strictly prohibited under the laws governing charitable organizations. In addition, Miller testified that funds were channeled through the Education Foundation to Sizemore's signature gathering company, I & R Petitions, and to the political action committee. Even though required by law, these were never reported on contribution and expenditure reports. And the disappearance of Saul Klein remains a mystery. Klein was Sizemore's right-hand man in the signature gathering activity that the jury found to be fraudulent.  Mr. Klein gave one videotaped deposition for the trial, then disappeared. His whereabouts remain unknown. In 2003, based on the jury findings against Sizemore's education foundation and additional evidence that had been presented, Multnomah County Circuit Court dissolved the "Education Foundation" and prohibited it from further operations, calling it a "sham charity." This is the entity that still owes OEA and AFT-Oregon more than $2.5 million. Plus legal fees and interest. The legal fees are approaching $1 million. Date: 3/17/2008 Sizemore Breaks the Law…Again: OEA Sues On Thursday, attorneys for the Oregon Education Association (OEA) and the American Federation of Teachers-Oregon (AFT-Oregon) filed a lawsuit in Multnomah County Circuit Court against Bill Sizemore, his wife Cindy, and the Americans for Tax Research Foundation (ATRF) for fraudulent transfer of funds and civil conspiracy. The lawsuit is based on evidence of the illegal transfer of funds among the defendants named in the suit and evidence of a conspiracy to defraud the plaintiffs. Read the complaint (PDF). The new lawsuit stems from evidence gathered during court proceedings in which Bill Sizemore disclosed information about his income and household finances. The proceedings are part of the process to enforce a court-awarded money judgment against Mr. Sizemore. During the proceedings, Mr. Sizemore admitted that the Americans for Tax Research Foundation has been paying CBS Consulting, a firm operating under Cindy Sizemore’s name, $7,500 a month to design a website. ATRF is Cindy Sizemore’s only client. Additionally, ATRF has paid $2,500 a month for rent for the Sizemore family residence and additional amounts for a family vehicle, office space and equipment. Mr. Sizemore is legally obligated to pay the amounts owed to OEA and AFT, but he has consistently claimed he has little to no income. Mr. Sizemore has disclosed, however, that he receives $1,000 a month from his wife. The lawsuit asserts that Mr. Sizemore, his wife Cindy, and the Nevada based Americans for Tax Research Foundation have devised a complicated conspiracy to illegally funnel money to the Sizemore household. In a statement to the media, OEA President Larry Wolf said, “Mr. Sizemore continues to think and act like he is above the law. And now he’s enlisted the help of his wife and an out-of-state special interest group to assist in his continued unlawful schemes.” For more than a decade Bill Sizemore has attacked Oregon’s hard working educators and school employees. It’s been nearly six years since a jury found he engaged in racketeering, forgery and fraud and Sizemore has yet to make good on the multi-million dollar judgment that he owes to OEA and AFT-Oregon members. On a related note, attorneys for OEA and AFT-Oregon are pursuing contempt claims for Mr. Sizemore’s repeated violations of a court-ordered injunction barring him from raising and spending money through a political action committee until the judgment is satisfied. They argue that because of Mr. Sizemore’s ongoing course of conduct which violates the court’s order that Mr. Sizemore should be held in contempt and be required to serve as much as 6 months in jail. Date: 11/29/2007 Racketeer Bill Sizemore Back in Court In a continued attempt to avoid paying a multi-million dollar judgment issued against Bill Sizemore's organizations by a Multnomah County jury in 2002, legal counsel for racketeer Sizemore recently appeared before the Oregon Supreme Court. As a reminder, the 2002 jury found that Sizemore had engaged in a pattern of racketeering, fraud and forgery during the signature gathering process and awarded the OEA and AFT-Oregon over $2.5 million in damages and nearly $1 million in legal costs. Last October, the Court of Appeals denied Sizemore's attempt to overturn the jury ruling and affirmed that his organization engaged in a "calculated course of criminal conduct" and "cynical, criminal manipulation of the democratic process."  Sizemore's attorney did not dispute the facts which formed the basis for the jury findings. Instead, he appealed the 2002 ruling to the Supreme Court on legal technicalities. This week, during his oral argument in a session lasting just over an hour, Sizemore attorney Greg Byrne hinged his argument on whether OEA and AFT-Oregon were intended targets of the forgery, fraud, and racketeering findings against his client. Byrne also posed questions about the intent and scope of Oregon's racketeering laws and whether they applied in this case. On the point of intent, Byrne's statements were later refuted by attorneys representing OEA and AFT-Oregon, who cited the trial records in which Sizemore, when questioned whether it was his plan to have so many measures on the ballots in order to deplete the funds of his opponents, answered: "Yes, it was part of our strategy." Oddly, Byrne also asserted to the court that in "every one of these campaigns with paid signatures there are going to be forgeries." Sizemore is currently the chief petitioner for at least 45 separate Political Action Committees (PACs) and is seeking to put multiple measures on the 2008 ballot attacking public employees and schools. This past Friday, Sizemore submitted Contribution and Expenditure reports for his PACs to the Oregon Secretary of State. On these reports, out-of-state political financier Loren Parks gave Sizemore $500,000 to help put five measures on the 2008 ballot. In a recent statement to the media, OEA vice-president Gail Rasmussen said, "Bill Sizemore continues to look for a way out of paying the big bill owed to tens of thousands of hard-working Oregonians. He wants to continue to dodge justice, manipulate the initiative system, and line his own pockets with misbegotten money." Date: 9/12/2007 Judgments against Sizemore organizations unchanged Millions still owed for racketeering and criminal conduct. December 7, 2006 In the wake of the Oregon Court of Appeals ruling yesterday, Bill Sizemore's organizations still have a big bill pay to Oregon's union movement. Meanwhile, Sizemore continues to dodge justice, flout the law, and try to rebuild his signature-gathering profit center. "The jury declared and the courts continue to uphold that Bill Sizemore ran a sham organization and engaged in corrupt practices," says Gail Rasmussen, vice-president of the Oregon Education Association.  Yesterday's ruling came after repeated efforts by Sizemore to avoid paying the $2.5 million judgment issued against his organizations by a Multnomah County jury in 2002. Last October, the Court of Appeals denied his attempt to overturn the jury ruling and affirmed that his organization engaged in a "calculated course of criminal conduct" and "cynical, criminal manipulation of the democratic process." That ruling has not been overturned. But in October, the court also ruled that current state law is not broad enough to capture all of the fraud that Sizemore committed in the 2000 election, such as falsifying state contribution and expenditure reports and money laundering. The Courts agreed that Sizemore's political action committee committed these violations, but under the law, has no way to hold the PAC liable. The ruling yesterday was a clarification of that point, based on a "motion to reconsider" filed by the Oregon Education Association and American Federation of Teachers-Oregon. "In many ways, Bill Sizemore is a visionary," says Rasmussen. "He broke the law in ways the law did not anticipate." Regardless, the Oregon Taxpayers' United Education Foundation - the other branch of his organization - remains liable for the $2.5 million judgment in addition to $900,000 in attorney fees. The court dissolved the foundation after the jury ruling because it was nothing but a front group for Sizemore's political activities. Future court proceedings will determine the mechanism of how the judgment will be paid. In the meantime, the judgment increases by 9 percent annually, so the longer Sizemore avoids justice, the larger the final bill will be. "The truth will catch up with Bill Sizemore and he and his organizations will be held accountable for the fraud perpetuated on the Oregon voters," says Dick Schwarz, president of the American Federation of Teachers - Oregon. Meanwhile, Sizemore remains under investigation by the Oregon Secretary of State for violating signature gathering rules for the 2006 election and is currently circulating measures for the 2008 election. Date: 12/7/2006 Bill Sizemore's organization committed racketeering and "criminal conduct" The Oregon Court of Appeals ruled yesterday that the Multnomah County jury was right when they ruled in 2002 that Bill Sizemore's organizations engaged in fraud and racketeering in running his initiative empire. The appeal-brought by Bill Sizemore after a 15-member jury found his organizations had engaged in fraud, forgery, and racketeering in a 2002 civil trial related to initiative petitions-upheld most of the original findings and judgments against Sizemore's operations. The judgment includes more than $3 million in damages and attorney fees. Larry Wolf, president of the Oregon Education Association, says his organization's members are pleased with the ruling. "When our members began the path that led us to yesterday's ruling, they did not take it lightly," he said. "But the facts left us no choice. The evidence showed and now the Court of Appeals has affirmed, that Sizemore's organizations used fraud, forgery and racketeering to attack Oregon teachers, school employees, and funding for education while creating an initiative empire that was his own personal profit center." In Wednesday's ruling, the Court of Appeals did the following: • Affirmed the 2002 jury ruling that Bill Sizemore's education foundation and political action committee committed fraud and racketeering in petition-gathering for two ballot measures in the 2000 election. • Affirmed the 2002 jury ruling that Bill Sizemore's organizations engaged in fraud and racketeering designed specifically to force our members to spend resources fighting anti-worker measures in order to leave them powerless and unable to advance a positive agenda for school employees and public education. • Affirmed that Bill Sizemore's organizations engaged in "money laundering" by illegally moving money from a so-called education foundation into a political organization. • Affirmed that Bill Sizemore's organizations owe the members of AFT-Oregon and OEA more than $3 million. • Upheld the injunction against Bill Sizemore's Oregon Taxpayer's United from violating any election laws relating to signature gathering. Richard Schwarz of the American Federation of Teachers-Oregon, points out that Bill Sizemore is back on the street with several ballot measures for 2008. Meanwhile, he is under investigation by the Oregon Secretary of State for violating signature-gathering rules in 2006. "Whether Bill Sizemore can follow the rules and stay in the initiative business, however, remains to be seen," Schwarz said. "In 2002, Oregon voters spoke out loud and clear that they will not tolerate fraud in the initiative system. Yesterday, in a strongly worded ruling, the Oregon Court of Appeals agreed. The voters have spoken. The courts have spoken. We are all waiting to see whether Bill Sizemore and his associates are listening."   Date: 10/5/2006 Bill Sizemore Held Personally Liable for Fraud and Racketeering Convictions In August 2004, Multnomah County Circuit Court Judge Ann Fisher ruled that Bill Sizemore is personally liable for more than 3 million dollars awarded two years ago to the Oregon Education Association and the American Federation of Teachers (AFT)–Oregon, as the result of a joint civil lawsuit filed by the two organizations in 2001. In 2002 a 15-member jury found various organizations owned and/or operated by Bill Sizemore had engaged in patterns of fraud, forgery, and racketeering while placing initiatives on the Oregon ballot. The jury awarded OEA and AFT-Oregon damages because the two organizations were forced to spend funds fighting various measures that had been put fraudulently on the ballot (Oregon voters defeated the Sizemore measures). Sizemore was either the Executive Director or sole employee of the organizations involved. The County Judge ruling makes Sizemore personally liable for more than $3 million due from the 2002 civil lawsuit.   Sizemore’s immediate response was to declare that OEA and other public employee unions run not only Oregon state government, but the state’s legal system as well. “This is liberal, Multnomah County activist judges doing favors for public employee unions who essentially run the government in this state.” Sizemore says he has no money and will appeal the decision. This hasn’t been a good year for Bill Sizemore. Earlier this spring, a different Multnomah County Circuit Court Judge held him in contempt of court for actions he took after the original trial in violation of that judge’s rulings. In addition, none of Bill Sizemore’s various initiatives obtained enough signatures this summer to qualify for the November 2004 ballot, including one approved for circulation in March that banned public employees from joining unions, engaging in collective bargaining, and using a grievance process to resolve differences. Date: 8/20/2004 2002 Sizemore Racketeering Case - A Daily Log Below is an extensive log of events from the OEA/AFT-Oregon versus Oregon Taxpayers United (OTU) lawsuit from September 9-27, 2002. Week 1 Monday, September 9 - Day 1 This morning Judge LaBarre denied OTU/OTUEF/OTU PAC's request to dismiss OEA's and AFT's three counts of racketeering violations. OEA and AFT will now be allowed to present evidence supporting all three of their counts to a jury. The three counts are forgery on statements of sponsorship, forgery on initiative petitions, and filing false tax returns and campaign finance reports. Bill Sizemore, Executive director of OTU, did not make an appearance in court today, but is expected to attend the proceedings Tuesday. OTU and OTUEF have now admitted and agreed to stipulate that five individuals whose signatures appeared on the sponsorship petitions for Measures 92 and 98 did not sign those petitions and their signatures were forged. They also agreed that one other person whose signature appeared on the statement of sponsorship for Measure 92 did not sign it and her signature was forged. Jury selection began Monday afternoon and is expected to last through most of today. Opening statements could occur as early as Tuesday afternoon but may not begin until Wednesday morning. Tuesday, September 10 - Day 2 Jury selection was completed today. Jurors were sworn in and given initial instructions by Judge Jerome LaBarre and then excused for the evening. Opening statements will begin the day tomorrow, Wednesday, September 11, followed by testimony from a number of witnesses. Bill Sizemore, Executive Director of Oregon Taxpayers United, was reluctant to attend court the first two days of the trial while the jury was being selected. He is expected to be in court on Wednesday. Fifteen jurors were selected for the trial, which Judge LaBarre estimates will conclude on or around September 25th. At the end of all testimony, the court will randomly select and excuse three jurors. The remaining 12 jurors will then begin deliberations. Tuesday, September 11 - Day 3 With jury selection complete, day three of the trial began with opening statements from attorneys for the Oregon Education Association (OEA) and American Federation of Teachers (AFT-Oregon). Greg Hartman, representing OEA, outlined for the jurors the scope of the racketeering case. He advised jurors that evidence would be offered that demonstrated a consistent pattern of racketeering activities on the part of multiple enterprises, many of which are at the same office address with the same employees. Hartman said evidence would be offered on: Oregon Taxpayers United (OTU), Oregon Taxpayers United Political Action Committee (OTU-PAC), Oregon Taxpayers United Education Foundation (OTU-EF), I & R Petitions, Kline Campaigns and N.F.P. Bill Sizemore is the owner of some; the sole employee of others. Racketeering activities include forgery of signatures on statements of sponsorship for initiative petitions; additional forgery on the actual initiative petitions; and false filings of tax statements and other campaign contribution and expenditure records required by law. Jurors heard that the case was about corporate dishonesty and "playing fast and loose" with funds that were laundered through a charitable foundation, but ultimately used for political purposes. OEA is seeking $2,250,000 in damages; AFT is seeking $510,000. In the defendant's opening statement, attorney Greg Byrne introduced his client, Bill Sizemore, to the jury. (Sizemore did not attend the first two days of the trial while jury selection was occurring.) He acknowledged there had been forgeries on statements of sponsorship by an employee of Bill Sizemore's, however, indicated Sizemore was unaware of the forgeries. Byrne told jurors that by the nature of the business of signature gathering, forgeries on initiative petitions were "inevitable," but Bill Sizemore screened every sheet and was "diligent" to assure no forgeries occurred. Byrne told jurors that Contribution and Expenditure (C&E) reports were signed by Becky Miller, "number two person" of OTU-PAC and OTU-EF; and although Sizemore signed tax returns, he thought "they were OK." He concluded his remarks by saying an IRS agent in 1999 found "nothing wrong" as did the state Attorney General. Once opening statements were concluded, four witnesses took the stand. They included: Kris Kain, OEA president, who outlined for the jurors her background as an elementary teacher; the governance structure of OEA; the mission of the organization and who OEA represents. James Sager, OEA president 1997-2001, who discussed why the organization opposed Measures 92 and 98 on the November 2000 ballot; and how OEA Representative Assembly delegates allocated funds to defeat the measures. Scott Tighe, a manager in the Election Division of the Secretary of State's office, who outlined for the jurors how an "idea" becomes a ballot measure. Fred Neal, a manager in the Election Division of the Secretary of State's office, who outlined the regulations around the filing of state C&E reports. Day four of the trial is scheduled to begin at 9:15am, Thursday. Former OTU employee Becky Miller is expected to take the witness stand between 9:30 - 10:00am. Bill Sizemore is also expected to take the stand this week. Thursday, September 12 - Day 4 Becky Miller, former employee of Oregon Taxpayers United Education Foundation (OTU-EF), held the court spellbound from the witness stand for most of the day, Thursday. Miller, hired in March 1997 by Bill Sizemore, worked her way up from secretary/bookkeeper to the "Number 2" position in the organization prior to her departure in April 2001. In great detail she outlined how contributions from Oregonians and Oregon businesses to entities owned by Bill Sizemore were laundered through a Washington, D.C. corporation, Americans for Tax Reform. She indicated the purpose was to hide who was actually contributing to Sizemore campaigns in part "because they were afraid their business would be boycotted by the unions." A 990 reporting form from American Tax Reform outlined that in a single time period they sent Oregon Taxpayers United-PAC-$100,000; I & R Petitions-$65,000; and "Committee to Preserve Self Government"-$25,000; all mailed to the same address and office where OTU-PAC and OTU-EF are located. She indicated these were not included on C&E reports required by the State of Oregon. In addition, Miller testified that many charitable or educational "accomplishments" listed on OTU-EF financial reports (990/CT-12s) with a corresponding dollar amount never occurred. She testified that twice she had to manufacture materials because The Oregonian was demanding to see them. She discussed the improbability of multiple OTU-EF projects listed on a financial form for a one year period all costing the same amount to complete: $55,704 apiece. She indicated that records were rarely kept, but a booklet that took her a couple of days to write (300 copies made) was listed on another financial report as costing $19,000. She did not feel that was close to accurate and then went on to point out many other inconsistencies on OTU-EF documents. At one point she called the numbers on the financial forms "laughable" because "no one was really looking at the numbers." Miller testified that she and others were employees of the OTU-EF, but the reality was that in some years they spent 75% of their time on political, not charitable or education business. To that point she discussed how she spent a month working on Bill Sizemore's campaign for Governor in 1998 from her desk at the Education Foundation. Her time was listed on a report as an "in kind" donation, although she was not a volunteer and had been paid for her time by OTU-EF. She said she asked Sizemore about it and he indicated the "in kind" listing would show he had more support for his gubernatorial campaign than he actually had and would help bring in more money from outside contributors. While Miller was employed by OTU-EF, the IRS conducted an audit. Miller testified that she reviewed the minutes from the OTU-EF Board meetings and found them to be full of broad, political discussions. She indicated she rewrote the minutes, although she never attended any of the meetings, to eliminate the references to political discussions. She provided the doctored documents to the IRS who later informed OTU-EF they were "OK." She said, "Bill Sizemore was pleased with my work." She testified at length as to how funds were channeled through the Education Foundation to I & R Petitions and OTU-PAC and never reported on C&E Reports. At one point she indicated she had completed an "Agent Report" which earned her a $7,500 check from Bill Sizemore. She said the time she spent on the report was worth far less than the $7,500 she received. "Maybe $750," she said, but admitted to cashing the check. She also testified that Bill Sizemore wrote personal checks to himself for large amounts from OTU-EF, I & R Petitions and OTU-PAC. Miller testified that Sizemore needed money for a signature campaign run through his company, I & R Petitions. She indicated Robert Randall, a Portland developer now deceased, arranged with Sizemore to buy stock in I & R Petitions so his contributions would not have to appear on Contribution & Expenditure reports. She indicated it was just another way to "hide money." Miller outlined for the jurors the strategy discussed in 2000 at OTU offices to place seven measures on the ballot. She said, "Measure 95 (teacher salaries based on student test scores) was "designed for OEA to spend money opposing it." She added, "Inasmuch as OEA had the inability to spend money to stop all our agenda (seven measures), we had prevented advancement of their agenda by making them spend money to oppose us." On the subject of forged petitions, Miller testified that she herself had taken a petition of sponsorship to the county election office to make sure the signatures matched voter registration cards. She said her research led her to believe "every last one of them was forged." In return for her truthful testimony during the trial, Becky Miller acknowledged that federal and state authorities "won't prosecute me for what I say." In addition, OEA and AFT-Oregon have agreed "not to seek judgment against me in this case." Under cross-examination by attorney Greg Byrne, Becky Miller said she left Bill Sizemore's businesses because, "I felt guilty. I felt dirty. And I did wrong against the people of Oregon." The trial will resume Friday, September 13, with Becky Miller back on the stand for a short time. Bill Sizemore will then be called as a witness. Friday, September 13 - Day 5 Witnesses: -Becky Miller, former OTU-EF employee (cross-examination continued from Thursday) -Steve Middleton, Certified Public Accountant -Bill Sizemore, Executive Director of various OTU enterprises, owner of I&R Petitions Under continued cross-examination this morning, former "number two person" within the Sizemore operations, Becky Miller, reinforced much of her testimony from the previous day. Once again she expressed the position she found herself in, "My job was to protect a front -- that we were doing things correctly -- even though we were not." She referenced money laundered through Americans for Tax Reform; a payment for stock in I&R Petitions by Portland developer Robert Randall which was a "scheme" so that Randall's name wouldn't appear on Contribution & Expenditure reports; and her observations that Bill Sizemore was draining large sums out of I&R Petitions for his personal use while office bills went unpaid and staff worried about receiving a paycheck. She said, "Huge amounts of money were being spent by Mr. Sizemore. The money he was draining away from the organization was a huge volume, enormous, and we needed the money." She later added, "I felt he was funneling money into his own company for his personal use." The afternoon began with lengthy testimony by Steve Middleton, a certified public accountant, who explained to the jury that during the time that signatures were being gathered for a number of potential measures aimed at the November 2000 ballot, the OTU Education Foundation (a non-profit, charitable, education foundation) contributed substantial amounts of money to the political needs of OTU-PAC and I&R Petitions -- somewhere between 25 - 36 percent of the entire operation (somewhere between $245,775 - $349,149). This was based on an analysis of C&E reports, check book registers and other financial documents. At 3:25pm, before a large media audience, Bill Sizemore went to the witness stand where his memory continued to fail him throughout the remainder of the afternoon. Sizemore "couldn't recall" the cost range that he paid per signature in 2000. When pressed he thought 50-60 cents apiece. He was unaware of the details surrounding the signature gathering operations of Saul Klein even though he "met with him twice a week and talked to him on the phone frequently." He was "unsure" of the details around the Robert Randall stock purchase except to recall that he did approach Randall for the first time in 1999 to purchase 10 shares of stock in I&R Petitions for $150,000. Sizemore wasn't sure how many shares of I&R Petitions he personally owned, although he later volunteered: 40. Sizemore admitted that I&R Petitions had no assets other than his "expertise" and he received "consulting fees" from the company -- approximately $50,000 - $60,000. He later characterized his consulting fees as "sweat equity." He reported that he re-purchased the stock from Robert Randall for $100 -- and believed that event occurred just days prior to a scheduled deposition with OEA. Sizemore was shown six checks for $25,000 from Robert Randall and was asked whether those represented the $150,000 for stock purchase. He said, "Yes." He was then shown another $20,000 check from Robert Randall and asked what that was for. Sizemore couldn't recall but thought "maybe for more stock." When asked if he could produce any documents about the $20,000, Sizemore responded, "Nope." Sizemore was then shown the original document of incorporation for I&R Petitions and was asked whether it was accurate. After reading it carefully, Sizemore responded, "Yes." It was then pointed out to him by Greg Hartman, attorney for OEA, that the 1997 document showed another $150,000 from Robert Randall for 10 shares of stock in I&R Petitions. Sizemore was asked whether Randall owned 20 shares of stock or whether this earlier stock had been re-purchased by Sizemore as had been the case in 1999. Sizemore couldn't recall... and then volunteered that maybe the "deal had never been consummated." Sizemore was asked whether Robert Randall ever received any money for his investment in I&R Petitions and Sizemore said, "I&R Petitions was never a profitable company." Sizemore was shown the check register for I&R Petitions beginning in 1999 that outlined hundreds of thousands of dollars withdrawn for the personal benefit of Sizemore. Entries included approximately $50,000 payable to Bill Sizemore; $6,000 payable to Sizemore's wife; $20,000 to pay Sizemore's American Express bill; $15,000 for a tractor; $123,000 loaned to Sizemore's failing radio station; a number of checks to various contractors who were doing work on Sizemore's home and property; plus checks to pay for Sizemore's personal automobile. The total amount drained from I&R Petitions for Sizemore's own use was in excess of $200,000. Sizemore was asked why there were no tax returns available for I&R Petitions. Sizemore responded, "I&R Petition had no profits; so I didn't file tax returns." He added, "I believe we used the money for legitimate purposes." The trial resumes Monday, September 16, at 9:30am. Week 2 Monday, September 16 - Day 6 The civil lawsuit trial between the Oregon Education Association (OEA)/American Federation of Teachers-Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); and OTU Education Foundation (OTU-EF) entered its second week today. Bill Sizemore is Executive Director of OTU, OTU-PAC, and OTU-EF. He is sole employee, or full or part owner of other enterprises involved in the lawsuit, including: I&R Petitions, Petitions & Surveys, Inc., and KGGT, a radio station that features Bill Sizemore on a daily program. OEA and AFT-Oregon have charged that various OTU entities have engaged in a pattern of fraud and racketeering activities that caused them damage. OEA and AFT-Oregon are seeking close to $3 million in damages related to forgeries of signatures on petitions of sponsorship for potential ballot measures; forgeries on initiative petitions used to qualify measures for a ballot; and false filings of a series of federal tax documents and state Contribution & Expenditure (C&E) reports. Here is a summary of today's proceedings held in Courtroom 702, at the Multnomah County Courthouse, 1021 SW Fourth in Portland. Judge Jerome LaBarre is presiding. Judge LaBarre issued an order that prevents the parties involved in the case from speaking to the news media. This was issued based on complaints from both sides that the other party was providing testimony through the media. (On Friday, Judge LaBarre ruled that the news media had to "pool" their equipment -- allowing one television camera & microphone; one radio microphone; one still photographer. Bill McCall, representing Associated Press, volunteered to serve as a broker for the pool -- providing access to the media.) Witness: Steve Middleton, a Certified Public Accountant (CPA), who was a witness on Friday returned for a brief appearance to confirm that money transfers from OTU-PAC had not been reported on C&E reports based on his examination of the documents. Witness: Carol Bobo, a current employee of OTU Education Foundation (hired in September 2000) who characterized herself as "chief cook and bottle washer." She testified that she and Bill Sizemore are the only two employees who work out of the location where OTU, OTU-PAC and OTU-EF share the same address. She testified that her duties included phone contact with the public, opening mail, making bank deposits for both PAC and EF funds, paying rent and other bills, data entry, and other administrative duties. She indicated that she was on the EF payroll only; but was treasurer of the PAC and did work for both organizations. She admitted she did not document or separate the amount of time she spent working on EF and PAC activities; but did generate from her computer data for C&E reports. In addition, she was responsible for providing information to accountants who prepared tax returns. Bobo repeatedly volunteered that she worked "independently" from Bill Sizemore. "I do say 'Hello' in the morning," she said. Under repeated questioning, she did admit that Bill Sizemore was her boss and that they were the only two employees in the same office. Witness: Leesa Beaudoin, a former, short-term, OTU employee who worked from February - August 2000 sorting initiative petitions and serving as a bookkeeper to the radio station operated by Bill Sizemore. She testified that most of her job was sorting, reviewing and numbering initiative petitions. She indicated that "suspicious" petitions were either returned to Saul Klein, owner of Klein Campaigns, who worked directly with signature gatherers; or showed them to Becky Miller, Becky's husband Stewart, or Bill Sizemore -- who made decisions about whether to keep them or return them to Klein. She testified that after pointing out a "suspicious" petition to either Becky Miller or Bill Sizemore (she couldn't recall who it was), "I was told about the Roundtable." The Roundtable, she revealed, is a system for obtaining signature forgeries: 2 - 4 individuals take turns signing initiative petitions, changing ink colors, so the forgeries are less obvious. Witness: Terry Pancost, a tax-attorney, who educated the jurors in depth on what defines a non-profit, tax-exempt, public charity or private foundation and how that entity is eligible for 501-C3 status which allows contributions to be tax deductions on tax returns. OTU-EF has 501-C3 status. Pancost indicated that political work for candidates was prohibited. Becky Miller testified earlier that she spent a great deal of time working on Bill Sizemore's gubernatorial campaign in 1998 while on the payroll of the Education Foundation. In addition, he acknowledged that "insubstantial" work on initiatives was permitted (under 5% of the total); and in some limited cases 20% was allowable. He indicated, however, the EF had not completed the documents to earn the 20% designation. He also outlined for jurors that based on the data he was supplied, in 1997-98, the EF went over the 5% expense limit by $139,000; over the 20% limit by $120,000. In 1999-2000, the EF exceeded the 5% limit by $190,000 in excess expenses; and spent $131,000 over the 20% limit. Witness: Douglas Lovett, a CPA, who had OTU-EF as his client from 1997-August 2001. Lovett testified that he prepared the tax returns for OTU-EF, but was limited to the numbers supplied by his client. He did not conduct an audit to determine if the numbers given to him were accurate. He also indicated that he was not involved when the IRS conducted their audit. OTU-EF did not ask for his help for the IRS audit -- even though he was their accountant. Becky Miller testified earlier that she had doctored OTU-EF documents -- meeting minutes -- for the IRS audit. Witness: Paul Rundele, a self-employed attorney, who is also President and Chairman of the Board for OTU-EF. Rundele testified he met Sizemore in late '97 or early '98 and by late '98 was a member of the Board of Directors for OTU-EF. (He later noted that when he was added to the Board, he was also made President and Chairman.) Rundele testified that the Board was "advisory only" to Bill Sizemore and that they did not review financial documents as part of their responsibilities. When asked to outline for the jury the various educational or charitable projects accomplished by OTU-EF while he has served on the Board, Rundele couldn't "recall any projects that actually materialized." He noted that there were other Board members who may have had a closer interest in them, but when asked who they were he said, "I'd be hard pressed to tell names of other Board members." He admitted the Board consisted of 4-5 members and had met 7-8 times since he became Chairman. He recalled some political discussion during OTU-EF Board meetings, but believed most of that "took place before or after our education foundation meeting." An evening recess was called. The civil lawsuit trial is scheduled to resume at 9am, Tuesday, September 17th. Scheduled witnesses for Tuesday: Saul Klein, owner of Klein Campaigns and N.F.P. -- initiative petition signature-gathering businesses. This is reported to be a video of his deposition since Klein has no known address. Vicki Ervin, long-time election clerk for Multnomah County Eric Ormsby, an owner/operator in the signature-gathering business (also on video) Chris Lancefield, a signature-gather Dick Schwarz, Executive Director of AFT-Oregon Tricia Bosak, Assistant Executive Director (Center for Public Affairs), OEA Tuesday, September 17 - Day 7 Four witnesses testified today in the civil lawsuit brought by OEA and AFT-Oregon against various enterprises owned or operated by Bill Sizemore. OEA and AFT-Oregon have alleged fraud and racketeering activities by the various enterprises (including forgery of signatures on various initiative petitions and false filings of federal tax returns and state Contribution & Expenditure reports). Here is a summary today's proceedings in the Multnomah County courtroom of Judge Jerome LaBarre. Witness: Vicki Ervin, an 18-year Multnomah County election official. Recently retired, Ervin served as Director of Elections. Ervin educated jurors on the process of verifying signatures on initiative petitions in Multnomah County for qualification purposes for the state ballot. She outlined the limited number of days available to check signatures, the need to hire temporary help to accomplish the task and provided a description of the sampling process. She described the difficulty of matching signatures from a digitized voter registration card since "writing on a clipboard in a rush is much different than signing a voter registration card at your leisure." She testified that election clerks take signatures that can't be verified through several steps, but "I can't say they have a good eye for forgery." Witness: Saul Klein, owner of Klein Campaigns, N.F.P and On Contact, various companies that have collected signatures for Bill Sizemore over the years. Klein's testimony was offered to the court through a videotape of a deposition taken December 10, 2001. Sometime after the deposition, Klein disappeared from Oregon and could not be located for the trial. In several hours of taped testimony, Klein revealed under pressure that he worked almost exclusively with Bill Sizemore and his companies, I&R Petitions and Petitions & Surveys, Inc. Klein acknowledged he had signed a contract with I&R Petitions, but couldn't recall having a copy of the contract. Klein's focus was to collect signatures and turn them over to Bill Sizemore. Klein's memory failed quite often during the deposition. He couldn't recall why he folded Klein Campaigns or exactly when; nor could he remember what the initials N.F.P. stood for. He had trouble remembering the address of his businesses and whether they operated in Washington, or Oregon, or both. He had the same memory misfortune in discussions around signature forgery. At some points in his deposition, he claimed there were limited forgeries of signatures on initiative petitions; at other times he declared it "widespread, a constant menace." Klein discussed how petition circulators subcontracted their signature collections, hired "writers" to complete everything on a signature line (date, printed name, address, county) except the signature, and other nuances of signature-gathering in Oregon. Klein named several petition circulators who routinely forged signatures, including Dan Ricca. A few more times during the deposition, Klein reversed his opinion and said Ricca didn't forge... then Ricca forged for a limited time... then people who worked for Ricca were the forgers... then declared that Ricca's signatures were "OK." Klein revealed he met with Sizemore twice a week to turn over signature collections and spoke to him for approximately "20 minutes a day, five days a week." Klein spoke haltingly that he worked "diligently" to ferret out any forgeries before they were handed over to Sizemore. When asked who helped him, he listed four names. When asked what these four individuals did specifically to check for forgeries, Klein reversed himself yet again and allowed that "I don't think anyone specifically helped me." Klein testified that he himself earned 10 cents per signature collected by his crew and that Sizemore paid him a bonus of $18,000 - $25,000 for having a validity rate on signatures around 80 percent. When asked about signatures gathered by an individual that were suspected to be forged, Klein said he had pulled out 100 petition sheets signed by this individual before he turned them over to Sizemore. When asked what procedures he uses to check for forgeries, Klein replied, "It's Cosmic Rules on determining signatures on petition sheets." He reviewed a number of petition sheets, declaring some were suspicious, some in the "gray area," some "clear forgeries," some "definitely forged".... then summed them all up by saying he "couldn't say." He then outlined vast amounts of time he devoted to checking for signature forgeries each week. At one point during the deposition, Klein outlined the system for turning over the collected signatures to Bill Sizemore. He indicated meetings were held twice a week -- sometimes over lunch, sometimes at OTU offices. When asked who was present at the "turnover" meetings, Klein responded Frank Eisenzimmer, who had "some involvement with OTU, I don't know what," and Kevin Mannix. Mannix is the Republican candidate for Oregon Governor on the November 2002 ballot. Bill Sizemore was the Republican candidate for Oregon Governor in 1998. Of final interest is Klein's revelation that he has filed no tax returns for himself or two of his businesses: Klein Campaigns and N.F.P. He made no mention of tax documents for On Contact, his third business. Witness: Christopher Lancefield, a childhood friend of Saul Klein, who went to work for Klein in 1999 (but was involved in various initiative campaigns in 1996), testified that he and Klein worked with signature gatherers, and checked each petition sheet to verify the correct county, signatures of circulators on the bottom, and kept a total of the number of signatures. He indicated he and Klein spent less than a minute to "process" each sheet. Lancefield noted in the beginning they turned in a couple of thousand of signatures a week to Sizemore; then 20 - 30,000 per week later in the signature gathering season. He testified that neither he nor Klein checked for forgeries, except for "sometimes a quick glance, but that was about it." Lancefield described twice-a-week meetings in their small offices (half to a third the size of the courtroom), where signature collectors would crowd in to turn over their signatures and get paid. He and Klein would then rapidly go through the thousands of signatures and hand them over to Sizemore the next morning. Lancefield told jurors that Sizemore's company would "charge back" three times the price of a signatures on a single sheet (up to $3.00 apiece) if "they had to mark off a signature" because it was from a different county than what the sheet was labeled. Lancefield couldn't recall a single "charge back" by Sizemore for forgeries. Lancefield indicated he quit in February 2000 because he was "stressed out" and "having nightmares." When questioned he noted he was stressed out from dealing with the kinds of people who collect signatures and their problems... and he had nightmares that he "was going to jail." When asked why he might have nightmares he indicated Klein had asked him to sign petition sheets that had been left blank in the space where circulators are required to sign their name. Lancefield felt that was illegal. Finally, Lancefield was asked whether he was aware of any surveys where signature gatherers were asked to get voter's opinions. Lancefield replied it did not happen. In earlier testimony former Sizemore aide, Becky Miller, said that in 2000 the OTU-Education Foundation gave $25,000 to Saul Klein for signature gathering. She said OTU-EF listed the funds on financial documents as being spent on conducting a "survey," which never occurred. Sizemore then testified that he had intended for Klein to conduct a survey and in a follow-up news story in The Oregonian, 9/13/2002, Sizemore said "Saul Klein owes me a survey." Witness: Dick Schwarz, Executive Director of AFT-Oregon, wrapped up the day providing testimony on the structure of AFT-Oregon and its affiliates, how dues are determined, and so on. He will resume testimony tomorrow. The trial is scheduled to resume at 9am, Wednesday, September 18th. Scheduled witnesses include: Dick Schwarz, (continuation of testimony) Dave Thomas, Oregon State University Statistician, retired Jim Green, forensic document/handwriting expert Eric Ormsby, signature-gatherer (on video) Tricia Bosak, Assistant Executive Director (Center for Public Affairs), OEA Wednesday, September 18 - Day 8 The civil lawsuit trial between the Oregon Education Association (OEA)/American Federation of Teachers-Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); and OTU Education Foundation (OTU-EF) continued today. Bill Sizemore is Executive Director of OTU, OTU-PAC, and OTU-EF. He is sole employee, or full or part owner of other enterprises involved in the lawsuit, including: I&R Petitions, Petitions & Surveys, Inc., and KGGT, a radio station that features Bill Sizemore on a daily program. OEA and AFT-Oregon have charged that various OTU entities have engaged in a pattern of fraud and racketeering activities that caused them damage. OEA and AFT-Oregon are seeking close to $1,000,000 in damages which are tripled if the charges are proven in this case. Charges include: forgeries of signatures on petitions of sponsorship for potential ballot measures; forgeries of signatures on initiative petitions used to qualify measures for a ballot; and false filings of federal tax returns and state Contribution & Expenditure (C&E) reports. Witness: Dick Schwarz, Executive Director of AFT-Oregon Schwarz continued his testimony that began yesterday afternoon. He explained to the jury how dues were determined and spent; and offered great detail about the structure of AFT-Oregon and other affiliates (local, national, AFL-CIO, etc.). He read and explained the text of Measures 92 and 98 on the November ballot and then outlined in painstaking detail for the jury the catastrophic consequences to AFT-Oregon if the measures were to become part of Oregon's Constitution. In essence, Measures 92 and 98 would be virtually impossible to follow, resulting not only in the loss of payroll deduction for public employees for anything: dues, political contributions, health insurance, charities, car payments, and so on... but also would result in fines quadruple to the amount of money either contributed or spent. In addition to virtually causing public employee organizations to shut-down, Oregon would also lose its best tool for educating the public on issues -- the Voters' Pamphlet -- if Measure 98 were to pass. During cross-examination, Greg Byrne (the attorney representing Bill Sizemore's corporations) asked Schwarz what AFT-Oregon would do with the money if they won the case. Schwarz replied, "We don't discuss where money goes that we don't have." Byrne then worked another angle: "Do you think it is fair that only 100 members at a convention decide how everyone else's dues money is spent?" Schwarz answered, "Yes, since they are elected at the local level by secret ballot to represent the interests of the members." He added, "It's like Congress." Byrne halted his cross-examination. Witness: Robert Preston, a tax law attorney, who worked on the perimeter while the IRS was conducting an audit of OTU-EF in 1999. Preston began his testimony by outlining his experience in tax law, but indicated he had no particular expertise with non-profit corporations. He indicated that Paul Rundele (see Day 6 for a summary of his testimony) brought Bill Sizemore to his office to discuss an impending audit by the IRS on the 501-C3 status of OTU-EF. He also said that subsequent to that meeting he spoke to both Becky Miller and Bill Sizemore three to four times apiece on the phone. He read his notes for the jurors which outlined the concerns IRS Agent Angela Wright expressed in a meeting. The IRS agent was concerned about: loans from OTU-EF to OTU-PAC and Bill Sizemore; no record keeping; too few donors giving too much money; and too much political activity by OTU-EF. Preston then read a letter from the IRS subsequent to the audit that indicated that they were not going to contest OTU-EF's 501-C3 status, which allows full tax deductions for any contribution. When questioned Preston admitted he didn't know what records the IRS were provided nor had he reviewed them; he didn't know what instructions Becky Miller received from Bill Sizemore regarding the audit; he didn't know the legitimacy of the records submitted to the IRS; and he didn't know how cursory or thorough the audit was. He noted, "Audits can be either way." He did acknowledge it was unusual for a tax attorney not to be involved in an IRS audit, but "that's how OTU wanted it." Earlier testimony by former Sizemore aide, Becky Miller, indicated she doctored documents for the audit with Sizemore's approval. Preston advised the jurors, however, that it was likely OTU's operations would receive more scrutiny from the IRS in the near future. "After a case like this, the IRS will likely come back and revisit," he said. Witness: Dr. David (Dave) Thomas, a 31-year faculty professor at Oregon State University, whose specialty is statistics and statistical analysis. Now retired, Thomas is a consultant with the Oregon Secretary of State's office on statistical sampling of signatures to qualify measures for the ballot. Dr. Thomas summarized for the jurors the process for certifying signatures to qualify measures for the ballot and how statistical sampling works. He explained that in 2000, for a measure to qualify for the ballot it had to have 89,084 valid signatures. He noted that in 2000, 129,583 signatures were turned in for Measure 98. Of those, 35,621 were declared invalid by a sampling process conducted of 6,491 signatures by county election offices. Simple math showed that Measure 98 qualified with 93,962 signatures -- 4,914 more than were needed. However, Dr. Thomas testified that based on handwriting analysis of a statistical sample, Measure 98 only qualified due to massive forgery of signatures on initiative petitions. Dr. Thomas advised jurors that he took a valid sub-sample of the original signature sample (225 signatures) and sent them to forensic document/handwriting expert Jim Green. He advised jurors that it would take 13 forgeries within the sub-sample to eliminate Measure 98's qualification for the November ballot. Due to the time, a recess was called for the day, so stay tuned.... Dr. Thomas will continue his testimony at 9:30am, Thursday, September 19, 2002, in Courtroom 702 in Multnomah County Court, 1021 SW Fourth. Judge Jerome LaBarre is presiding. Witnesses Scheduled for Thursday: Dr. David Thomas (continuation of today's testimony) Jim Green, forensic document/handwriting expert Eric Ormsby, signature-gatherer (on video) Tricia Bosak, Assistant Executive Director (Center for Public Affairs), OEA Thursday, September 19 - Day 9 The civil lawsuit between the Oregon Education Association (OEA)/American Federation of Teachers-Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); and OTU Education Foundation (OTU-EF) went into its ninth day. OEA and AFT-Oregon have charged that various OTU enterprises have engaged in a pattern of fraud and racketeering activities that have caused them damage. Charges include: forgeries of signatures on petitions of sponsorship for potential ballot measures; forgeries of signatures on initiative petitions used to qualify measures for a ballot; and false filings of federal tax returns and state Contribution and Expenditure (C&E) reports. Bill Sizemore is Executive Director of OTU, OTU-PAC, and OTU-EF. He is sole employee, or full or part owner of other enterprises involved in the lawsuit, including: I&R Petitions, Petitions & Surveys, Inc., and KGGT, a radio station that features Bill Sizemore on a daily program. Witness: Dr. David (Dave) Thomas, a specialist on statistics and statistical analysis (continued from yesterday). Now retired, Thomas is a consultant with the Oregon Secretary of State's office and developed the statistical sampling methodology for verifying signatures to qualify measures for the ballot. Dr. Thomas reviewed the statistics he shared with the jury yesterday. In 2000, a constitutional amendment had to have 89,084 valid signatures on initiative petitions to qualify it for the ballot. Oregon Taxpayers United turned in 129,583. Of those, 35,621 were declared invalid by a sampling process conducted of 6,491 signatures in county election offices. Measure 98 qualified with 93,962 signatures -- 4,914 more than were needed. Dr. Thomas then reviewed the sub-sample of the original signature sample (255 signatures) which we sent to Jim Green, a forensic document/handwriting expert to check for the number of forgeries. Today he reminded jurors that 13 forgeries discovered in the sub-sample would have statistically meant that Measure 98 didn't have enough valid signatures to qualify it for the ballot. This morning, Dr. Thomas testified that forensic document specialist Jim Green found 13 signatures that were potentially forged -- plus two more that were highly probable. Statistically, 13 forged signatures in the sub-sample was comparable to 5,176 more forgeries -- meaning Measure 98 would have had only 88,786 valid signatures -- less than the 89,084 required. In addition, more invalid signatures (non-registered voters) were discovered in the sub-sample, reducing the number of valid signatures for Measure 98 to 85,999. Witness: Eric Ormsby, a signature-gatherer (on video) Ormsby's appearance was via taped excerpts of his September 12, 2001 deposition. After the deposition, Ormsby vanished. Ormsby acknowledged he ran a crew of signature gatherers and signed the petitions as if he were the sole circulator. He indicated he did not pay for signatures, but rather he paid "for friendship." He also revealed proudly that "you have to be entertaining to get signatures" and admitted that he once carried petitions for 15 different measures at the same time. Witness: James (Jim) Green, forensic document examiner/handwriting expert Green began his career as a patrol officer and served on SWAT and arson teams in Eugene before being trained by the U.S. Secret Service and Postal Inspection Crime Lab on forensic document examination and handwriting analysis. Green began by showing jurors signatures on petitions of sponsorship (requiring only 25 signatures). On an overhead projector, he demonstrated to jurors that signatures on five separate petitions of sponsorship (for five different potential ballot measures -- including Measures 92 and 98) were markedly similar. An audible gasp could be heard from jurors and courtroom observers when he stacked transparencies of the five different sponsorship petitions on top of one another. The signatures were EXACTLY the same -- one petition to another. He indicated this was consistent with someone tracing signatures because individual signatures are slightly different every time they are written. He testified this meant that in at least four cases the signatures were forged; but acknowledged the fifth could be false as well because it could have been traced from a letter, a credit card or another document. All five of the petitions of sponsorship were signed by the circulator -- Kelli Highley, a former secretary for OTU Education Foundation. (Highley pled guilty to forgery February 21, 2001. She also pled guilty to perjury for lying to a Grand Jury about the forgeries. In 1985 she also pled guilty to forgery on a Robert Randall check. Sizemore's attorney has stipulated there are forgeries on the petitions of sponsorship for Measures 92 and 98 -- but not to the extent that was revealed in court today.) Following this bombshell, Green walked jurors through the methodology of checking for forgeries with the sub-sample provided by Dr. Thomas, the statistician. He advised jurors that he only checked 220 of the 255 signatures provided in the sub-sample because he limited his study to 10 Oregon counties where the greatest numbers of signatures were gathered. Green demonstrated in great detail with multiple exhibits, how he reached the conclusion that of the 220 signatures he checked, there were 189 "consistent" signatures; 12 he was unable to compare (printed name appeared on petition, signature appeared on voter registration card); 6 that were not on file in county election offices (non-registered voters); and 13 he found to be "not genuine." Based on the number of inconsistent/not genuine signatures found among the 220 signatures; the probability was high of two more "not genuine signatures" in the rest of the sub-sample. Witness: Kelli Highley, former employee of OTU-Education Foundation, convicted of forgery on initiative sponsorship petitions circulated through various OTU enterprises. Like several other witnesses who provided testimony in this trial (Bill Sizemore, Saul Klein, Paul Rundele), Highley was unable to recall much of the past. Highley attributed her memory loss to a car accident a year ago. She remembered she had been a secretary in the OTU-EF office and what a few of her duties were. She vaguely remembered Saul Klein who worked with Sizemore's I&R Petitions in signature gathering. She recalled Becky Miller was her supervisor and that Becky complained only about how busy she was -- never about Bill Sizemore. Witness: Tricia Bosak, Assistant Executive Director for Public Affairs, OEA Bosak took the stand late in the day and provided jurors with an overview of the public affairs activities of the OEA -- lobbying, member involvement in politics, and member education on political issues. Using her excellent memory she informed jurors how OEA's budget was determined through the governance structure of the organization and she was able to list a number of activities where the Association had expenditures -- with most of her focus in the area of public affairs. Bosak educated jurors that most decisions that impact public education today are political ones. She then outlined for the jury what some of those issues are: school funding, teacher licensure, testing, safety issues, collective bargaining, the public employee retirement system and so on. Bosak was able to clearly explain to jurors the content of Measures 92 and 98: constitutional amendments that would have limited/prohibited payroll deductions for public employees. She explained why OEA opposed these measures; and what consequence they would have on the organization if they were to pass. She also demonstrated to jurors that OEA was forced to spend money on Measures 92 and 98 even prior to their qualifying for the ballot -- during the stage when the ballot titles were drafted in December 1998 -- almost two years prior to the 2000 election. Bosak's testimony was recessed at this point due to the lateness of the hour. Bosak will return to the stand at 9am, tomorrow, Friday, September 20. TOMORROW: OEA and AFT-Oregon expect to rest their case after Bosak concludes her testimony. Greg Byrne, attorney for the various OTU enterprises plans to conclude the defense in a day or a day and a half. In all likelihood Bill Sizemore will return to the stand tomorrow. Friday, September 20 - Day 10 The civil lawsuit trial between the Oregon Education Association (OEA)/American Federation of Teachers - Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); and OTU-Education Foundation (OTU-EF) and various John Does ended its second week today. OEA and AFT-Oregon have charged that various OTU enterprises have engaged in a pattern of fraud and racketeering activities (including forgery and false statements) that have caused the two education Associations to suffer damage. Three counts have been filed: forgeries of signatures on petitions of sponsorship for potential ballot measures; forgeries of signatures on initiative petitions used to qualify measures for a ballot; and false filings of state and federal tax returns and state Contribution & Expenditure (C&E) reports. Together the two education Associations are suing for close to $1,000,000 in damages; which is tripled if the racketeering charges are proven in court. Bill Sizemore is Executive Director of OTU, OTU-PAC, and OTU-EF. He is sole employee, or full or part owner of other enterprises involved in the lawsuit, including: I&R Petitions, Petitions & Surveys, Inc., and KGGT, a radio station that features Bill Sizemore on a daily program. Witness: Tricia Bosak, Assistant Executive Director for Public Affairs, OEA Bosak continued her testimony from Thursday afternoon. Today she outlined for the jury the extensive amount of time spent by OEA staff, legal counsel and others to prepare for the Measures 92 and 98 campaign in 2000. Under cross-examination from Greg Byrne, the attorney representing the various OTU enterprises, Bosak said that the defeat of Measures 92 and 98 in Election 2000 had ranked as first priority on the long list of measures on the November ballot. She discussed her service on the steering committee of a coalition composed of groups and organizations that included not only teachers, community college faculty, education support professionals, but also police, nurses and firefighters. She also informed the jury that groups like the League of Women Voters had opposed the measures. At the conclusion of Bosak's testimony, OEA and AFT-Oregon (the plaintiffs) rested their case. The defense called their second witness, Leesa Beaudoin. (The first witness for the defense, Kelli Highley, testified yesterday afternoon. Her testimony was allowed to occur out of sequence due to the nature of her injuries suffered in a car accident a year ago.) Witness: Leesa Beaudoin, a former employee of OTU, who worked for a short time on initiative petitions. Beaudoin was called as a witness earlier this week by OEA and AFT-Oregon. (For details about her earlier testimony, please go to Day 6.) Beaudoin reminded jurors that she worked for approximately six months at OTU offices "screening" initiative petitions. She told jurors today that she also looked for "unusual" signatures (although she had no professional training in that area) and on several occasions showed suspicious signatures to Becky Miller for advice as to whether to keep them or put them in a pile to be returned to Saul Klein. Klein worked with Sizemore's company, I&R Petitions in gathering signatures. Under cross-examination she remembered that Daniel Ricca, a signature-gatherer, was a likely signature forger, since it was his petitions that first led to her education on the "Roundtable" system by other OTU employees. The Roundtable references several signature-gatherers sitting around a table forging signatures on each other's initiative petitions. Witness: Bill Sizemore, Executive Director, employee, sole or part owner of the various OTU enterprises charged with fraud and racketeering by OEA and AFT-Oregon. Sizemore began his testimony at 11am before a "standing room only" crowd -- mostly media representatives. He took five to ten minutes to respond to each question from his attorney until the judge intervened and suggested shorter answers. (To this courtroom observer, Sizemore is the kind of individual who when asked what time it is, will respond not only with the history of the clock but also grandly provide great detail about his fine watch collection.) Sizemore told jurors he got a diploma from Portland Bible College, had been a house painter, in the retail carpet business for five years (no mention of it folding under financial duress), and a toy manufacturing business (no mention of it folding under financial duress). With a broad smile, he mimed a frisbee with special lights that looked like a flying saucer (the flagship of his toy business) whose marketing took him to Hong Kong and Europe. His attorney had to interrupt that monologue. Sizemore informed jurors about his family, his five children, his house, his 37 acres, the work he did on his home, the tractor he had to buy, and much, much more. He told jurors he formed three companies -- OTU, OTU-PAC and OTU-EF within a few months of each other. He then proceeded to lecture the jurors on his ideas for public policy -- less government, fewer taxes, fewer special interest groups (especially public employees) and so on. It was at this point that his attorney shifted questioning to details about the various OTU enterprises. And in the famous words of Butterfly McQueen, who played "Prissy" in the legendary movie "Gone With The Wind," "Oooohhh, Ms. Scarlett! I don't know nuthin' 'bout birthin' babies," Sizemore didn't know nuthin' 'bout forgeries, fraud, false C&E reports or anything else. At one point he remarked, "I forgot OTU existed or even had a bank account." Sizemore did recall that OTU-EF had a Board of Directors. However, he couldn't recall how many members, "somewhere between three and seven," he said. He called the board "advisory" and said they would come together to discuss the merits of various OTU-EF research projects. (Most of which never happened according to testimony by Becky Miller. Earlier testimony by Paul Rundele, President of OTU-EF and Chairman of the OTU-EF Board, indicated he didn't know the names of the other Board members.) Sizemore told jurors that he had no connection to people like Lon Mabon who dealt with social issues. He said, "We're involved in fiscal policy only," forgetting that he drafted a measure in 2000 that would mandate teachers pay be based on student test scores. He admitted at one point to having 21,000 financial donors; but then later summarized donors as living in 12 - 14 thousand households that are on his mailing list. He said he earned roughly $20,000 a year from OTU-PAC; $55,000 a year from OTU-EF and received no salary from I&R petitions. (Previous testimony by former Sizemore aide Becky Miller disputes that fact.) When asked by his attorney how he comes up with ideas for his measures, Sizemore said, "I generally write them myself." He added, "You know, I make up ideas by myself." With prompting from his attorney, Sizemore then told jurors that OTU-EF conducted thorough research and sponsored a tax conference that created a list of 22 "state priorities." Sizemore could not recall any contracts with N.F.P. or Klein Campaigns, a company he partnered with to gather signatures for his measures. He didn't remember many details of that partnership, but remembered he told Klein to "comply with the law" when gathering signatures. On the subject of forgeries, Sizemore expressed no knowledge of employees in his office forging signatures (Kelli Highly, Becky Miller). He told jurors, "Fighting forgeries is my mission in life -- we spent a lot of time looking for them." He then noted with sadness, "I'm sorry. I get so emotional when talking about forgeries." He blamed county clerks for not catching forgeries and announced that he brought three boxes of signature petitions with forgeries on them that had never been turned into the Secretary of State's office. He then crawled on the floor opening boxes, lifting out handfuls of petitions for jurors to see. Recess for lunch was called. After lunch Sizemore's responses to his attorney's questions were much shorter. He outlined for jurors the seven measures OTU sponsored in 2000. He lamented OTU had no money to promote the measures and "we only bought a page or two in the Voters' Pamphlet." He told jurors that he wrote amendments to Oregon's Constitution because if he didn't, "the legislature could go in the next day and change them." He didn't know much about Kelli Highley's work and indicated she had been hired by and worked solely with Becky Miller. He said he only learned of Higley's forgery on statement of sponsorship petitions when he was called before a Grand Jury in June 2000. Although earlier he had indicated he barely knew Highley even though there were only three people working in his office... he testified that when learning of Highley's forgeries he met privately with her and said, "Just tell me, Kelli. Just between you and me, just Bill. Did you do it?" He told jurors she told him she didn't do it. He told jurors that prior to the trial he had no idea that Becky Miller forged circulator signatures on petitions, forged his name on checks, or "fabricated" C&E reports. He said, "Becky and I didn't discuss C&Es." He also told jurors that he was so far removed from the foundation's tax returns, which he only "glanced at," that he didn't even recognize the name of his accountant on the witness list. He didn't know anything about false information on tax forms and blamed Becky Miller for any problems, even though he signed the returns. He disputed Becky Miller's earlier testimony that she worked on his campaign for Governor in 1998 from her desk at the OTU-EF. Sizemore said, "Becky begged to work on my campaign. We wouldn't let her. We then said she could do the C&E's as a volunteer. She didn't do it as an employee of the foundation." Miller testified that she was paid by OTU-EF for her work on Sizemore's gubernatorial campaign. He also disputed her testimony about a $25,000 check payable to N.F.P. -- the company that partnered with Sizemore to gather signatures. Becky Miller said earlier that the money was to pay signature gatherers. Today Sizemore said it was for a survey. He said Miller was supposed to have drafted the questions, but the survey was never done because the questions were never prepared. Sizemore said, "It just got lost and the survey was never done." He admitted that Saul Klein never reimbursed him the $25,000. Recess was called until 9am, Monday, September 23, when Sizemore will resume his testimony on the stand. Week 3 Monday, September 23 - Day 11 The civil lawsuit trial between the Oregon Education Association (OEA)/American Federation of Teachers-Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); and OTU-Education Foundation (OTU-EF) and various John Does began its third week today. OEA and AFT-Oregon have charged that various OTU enterprises have engaged in a pattern of fraud and racketeering activities (including forgery and false statements) that have caused the two education Associations to suffer damage. Three counts have been filed: forgeries of signatures on initiative statements of sponsorship for potential ballot measures; forgeries of signatures on initiative petitions used to qualify measures for a ballot; and false filings of state Contribution & Expenditure (C&E) reports and federal tax returns. Together the two education Associations are suing for close to $1,000,000 in damages; which is tripled if the racketeering charges are proven in court. Witness: Only one witness was on the stand today. It was Bill Sizemore -- Executive Director, sole employee, sole or part owner of OTU, OTU-PAC, OTU-EF and other entities including: I&R Petitions; Petitions and Surveys, Inc. (corporations formed for signature gathering on initiative petitions); and KGGT, a radio station in the Portland metropolitan area which features Sizemore in a daily show. Greg Byrne, the attorney representing the various OTU entities, resumed questioning Bill Sizemore after the weekend recess. Sizemore spent most of the morning denying any involvement or knowledge about fraud, forgeries, false C&E reports and tax returns. At one point he said, "I wasn't involved in C&E reporting. I don't think I've seen any for several years." He reiterated that he knew nothing about his employee, Kelli Highley, forging signatures on five, initiative statements of sponsorship until after she had been indicted. He denied knowing anything about photocopies of checks sent to Americans For Tax Reform in Washington, D.C. that were discovered in his files. He said they arrived one day in a plain envelope with no note inside. On the subject of his authorizing Becky Miller to rewrite OTU-EF Board minutes prior to an audit by the IRS to eliminate any references to discussions around political issues, Sizemore said, "Becky Miller did tell me about copies of the Board minutes... that we had notes all over them and scribbles. She indicated there were so many side notes they would be difficult to read and offered to edit out things about side conversations. She asked to clean them up and I said 'fine'." He then reiterated that the IRS audit of his books found nothing wrong. Bill Sizemore took issue with Becky Miller's description of his lifestyle as "luxurious." Sizemore told jurors that he and his family didn't take luxurious vacations -- he reminded jurors he had five children. He did say every summer the family did go camping in a tent and spent a week at a central Oregon timeshare. When Byrne asked why the unions were filing this lawsuit, Sizemore replied, "We are political opponents. After the last campaign, which they won, they decided to shut us up and make us go away." Cross-examination by Gene Mechanic, the attorney representing AFT-Oregon, followed. Mechanic walked Sizemore through C&E reports, tax returns and other financial matters related to the various OTU entities. During initial questioning on OTU cash flow, Sizemore said, "On a day-to-day basis I'm unaware of my business cash flow -- unless there is a problem." Mechanic then read into the record an earlier deposition from Sizemore who said, "I was informed on a daily basis on what the financial situation was." Mechanic then asked Sizemore if he knew that for four years OTU-EF had paid for a Safari minivan for Sizemore's personal use to the tune of approximately $20,000. Sizemore said, "Some was for business." Mechanic also showed that OTU-EF also picked up all the health insurance premiums for Sizemore and his other OTU employees. Despite Sizemore's protests earlier in the day that he hadn't seen a C&E for years, Mechanic showed him 29 C&E reports filed in 1996 and 1998 that all bore the signature of Bill Sizemore. Sizemore said the C&E's were prepared by Becky Miller and "I just barely glanced at them. I did not go through them." Mechanic then read into the court record an earlier deposition from Sizemore on the subject of C&E reports who said, "Well, I look on the front, the summary sheet, and then look at it overall for accuracy." OTU-EF Board minutes also provided Bill Sizemore lots of opportunity to contradict himself. Mechanic read aloud to the jurors segments of various Board Minutes that discussed a variety of initiatives, signature gathering drives, the need for fundraising, the need to elect conservative Republicans into the legislature, a special training for 30 signature gatherers who would earn $15/hour, and other initiative issues. Mechanic then showed Sizemore copies of the minutes that were provided for the IRS audit which omitted every reference to political issues outlined above. Sizemore then backtracked, "I don't recall this." And later, "I am not sure those were the Board Minutes. They may be something else." The documents were all labeled, "Minutes" or "OTU-EF Board Minutes." Mechanic then tackled the subject of tax returns. Sizemore was mostly evasive, but acknowledged that in five years OTU-EF was able to produce for the court only two products of "accomplishments" out of dozens listed on OTU-EF tax returns. One was a 2-page pamphlet for parents; the other was a 16-page brochure that discussed a property tax relief measure. Sizemore's tax returns show these dissimilar products cost exactly the same to produce: $19,058 each. Sizemore couldn't explain why. He blamed Becky Miller and his accountant for the problem. Sizemore's personal tax returns portrayed a different income level from what Sizemore had spun for the jury earlier. At that time Sizemore depicted his home as "dilapidated with a basement that fills with water." His portrayal that as a father of five children he didn't have extra money to spend vanished under the weight of his $213,691 income for 2000. Under cross-examination he admitted his home had six bedrooms, his children had attended private school, that his stable included a "world-class show stallion." However, he said the horse was loaned to him by a relative. More scrutiny of his financial records produced a series of responses from Sizemore, "I don't know." "I don't recall." "I've forgotten it's been so long." "I'm not sure." And, "Becky Miller did it." Later, Sizemore blamed an arson fire at the OTU offices for the loss of financial records. Under cross-examination by Greg Hartman, the attorney representing OEA, Sizemore admitted that in a single year he had drained $112,000 from I&R Petitions for his own benefit (tractor, personal credit card bills, checks to his wife, checks to his mother-in-law, private school tuition for his children, etc. -- much of it not appearing on any tax return. Sizemore told the jurors that he had a "zero tolerance for forgeries." He added, "We have never knowingly turned in forgeries to the Secretary of State." He referenced the three boxes of petitions he brought to court that were full of forgeries that he hadn't turned in. Hartman than walked Sizemore through the contents of the boxes: more than half were initiative petitions for measures that were dropped part way through the signature gathering process; another quarter were for measures that didn't "belong" to any Bill Sizemore campaign. Sizemore then admitted he didn't know if there were any forgeries "on those." The subject then turned to Leesa Beaudoin's (a former OTU employee) earlier testimony that Dan Ricca was a known forger. Sizemore denied Ricca was a forger and went to great lengths to say that Ricca had been "framed" by another guy. Sizemore was asked if Ricca still collected signatures for Sizemore. Sizemore said, "Yes." Hartman then showed Sizemore that 376 initiative petitions that were in the "forged" box were signed with Dan Ricca as the petition circulator. Hartman then said, "With a zero tolerance for forgeries, Mr. Sizemore, are you still saying that Ricca is not a forger?" Sizemore replied, "Yes." The trial resumes tomorrow, Tuesday, September 24th, at 8:30am with Bill Sizemore in the witness stand to answer questions from the jurors. Greg Byrne is expected to call several former OTU employees as witnesses before he concludes the defense. Closing statements are expected to begin mid-morning with the case going to jurors before the end of the day. Tuesday, September 24 - Day 12 The civil lawsuit trial between the Oregon Education Association (OEA)/American Federation of Teachers-Oregon (AFT-Oregon) vs. Oregon Taxpayers United (OTU); OTU-Political Action Committee (OTU-PAC); OTU-Education Foundation (OTU-EF) and various John Does entered its 12th day today. OEA and AFT-Oregon have charged that various OTU enterprises have engaged in a pattern of fraud and racketeering activities (including forgery and false statements) that have caused the two education Associations to suffer damage. Three counts have been filed: forgeries of signatures on initiative statements of sponsorship for potential ballot measures; forgeries of signatures on initiative petitions used to qualify measures for a ballot; and false filings of state and federal tax returns and state Contribution & Expenditure (C&E) reports. Together the two education Associations are suing for close to $1,000,000 in damages; which is tripled if the racketeering charges are proven in court. Witness: Bill Sizemore -- Executive Director of OTU, OTU-PAC, and OTU-EF; sole employee, or full or part owner of other enterprises involved in the lawsuit, including: I&R Petitions, Petitions & Surveys, Inc. (corporations formed for signature gathering on initiative petitions) , and KGGT, a radio station that features Bill Sizemore on a daily program. Sizemore returned to the witness chair this morning to respond to a large volume of written questions from jurors. This was the first time juror questions were being asked prior to Bill Sizemore screening them. Jurors are permitted to submit written questions after attorneys from both sides have finished their questioning of a witness. The questions are numbered, entered as exhibits and reviewed by attorneys for both sides before being returned to Judge Jerome LaBarre. Judge LaBarre then reads the questions to the witness one by one. In each and every case prior to today, Bill Sizemore (who sits next to Defense Attorney Greg Byrne), read each juror question prior to it being given to Byrne. This courtroom observer has found Sizemore's screening of juror questions to be a real irony. Sizemore has characterized his management style as "hands off" in his office, blaming everyone else for forgeries and false C&E reports and tax returns. His courtroom behavior, however, reveals a very different style -- very much "hands on." Jurors' questions were quite pointed. Responses by Bill Sizemore were long, rambling and often off-point. On at least five separate occasions Judge LaBarre had to stop Sizemore's soliloquies and direct him to go back and simply answer the question. This writer has noted each question below and summarized Sizemore's responses after each question. Actual quotes have been noted. Did Bill Sizemore ever personally check signatures for validity? (No, that wasn't his job.) Why didn't he follow-up on the $25,000 check he wrote to Klein Campaigns for a research project that never happened? (It got lost in the crush of work and he forgot about it.) Why hasn't I&R Petitions ever filed a tax return? (There were never any profits despite the fact that he paid himself more than $138,000 out of it in a single year.) Isn't that tax evasion? ("No.") Did Bill Sizemore give Becky Miller $7,500 to keep her mouth shut about where I&R money was going? (No. He gave her the money because they had "friendly relations" and she prepared an "Agent Report" for him.) Is it morally or legally right to ask someone else to sign your name on a check? (Yes. He was out of town and payroll had to be met.) Whose idea was it to rewrite the OTU-EF Board meeting minutes to delete all references to politics prior to submission to the IRS? ("I don't remember this clearly.") Was it part of your strategic plan to have so many measures on the ballot that it would dilute the amount of money of your opponents? ("Yes, it was part of our strategy.") Don't you think it's important to review the documents you put your name to? ("Yes. I'll look at our tax documents more closely in the future.") Who prepared C&E reports prior to Becky Miller? ("Lots of people." No names were provided.) What did you do with the checks that were made payable to just OTU? Were they deposited in the Foundation or PAC account? ("I can't recall.") Did I&R petitions prepare 1099 forms for Saul Klein and his companies? ("I don't recall.") Do you remember Becky Miller objecting to moving $50,000 from OTU-EF to I&R Petitions? ("I don't recall this incident clearly.") Does OTU, OTU-EF and OTU-PAC do background checks during the hiring process? ("No. If we continue in business we probably will.") Mr. Sizemore, your style of company directorship -- especially with signing important financial documents -- seems quite casual. It seems like no one at OTU takes full responsibility for the content of tax documents. Is that true? (Lots of double-speak, then finally, "Ultimately, it is my responsibility.") How did you do fundraising for OTU-EF and OTU-PAC? Did you do them in the same letter? Separate mailings? ("Sometimes we just did the PAC. Sometimes just OTU-EF. Sometimes we did them both but that wasn't normal.") In follow-up to juror questions, Attorney Greg Hartman, representing OEA, asked Sizemore about fundraising. Hartman said, "Do you recall a 1998 Measure 59 fundraising letter where you told donors there was 'good news'... that they could contribute to Measure 59 through the foundation, write off the entire amount of their contribution and their identity would be hidden?" Sizemore launched into more double-speak that was incoherent. Hartman, holding the fundraising letter in his hand, asked the question twice more and got the same incoherent responses. Finally Hartman admonished Sizemore to simply answer the question "Yes" or "No." With blood rushing to his face, Sizemore responded, "Yes. I did." Witness: Darrell Marc Trueb, former OTU fundraiser, testified that Becky Miller was professional, but could be rude and difficult to work with. He told jurors he once complained to Sizemore about Becky's arrogance, but Sizemore told him, "She's a little rough around the edges, but very bright." Witness: Dayna Batuso, former scheduler for Sizemore during his 1998 gubernatorial campaign. She testified that Becky Miller and Bill Sizemore were good friends and "she was in awe of him." She noted that "Becky liked to throw her weight around the office." Closing arguments began at 2pm. Greg Hartman, representing OEA, and Gene Mechanic, representing AFT-Oregon, each addressed the jury for an hour. Both Hartman and Mechanic pointed out the many inconsistencies and contradictions in testimony from Bill Sizemore and Becky Miller. Hartman outlined the thousands of forgeries found on petitions for Measure 98; and the Kelli Highley forgeries on multiple, initiative statements of sponsorships. He revisited with jurors the stock scheme that according to Becky Miller was cooked up to hide $150,000 in contributions to Sizemore's operations. He pointed out that Sizemore controlled Saul Klein's signature gathering operations -- even dictating the price that was paid per signature; and that Sizemore made no effort to ferret out forgeries on petitions that came through his door. Gene Mechanic reminded jurors of the many inconsistencies and falsehoods in the financial documents provided on state and federal tax returns and C&E reports. He acknowledged that perhaps Sizemore could forget about a $25,000 check to Saul Klein for "research" that never happened. But, how could Sizemore forget $150,000 in donations from Americans for Tax Reform in a single year? He reminded jurors that Sizemore said he couldn't recall who signed C&E reports before Becky Miller -- yet Sizemore signed 29 of them. Hartman and Mechanic urged jurors to send a message to OTU enterprises: Oregonians won't tolerate forgery in the initiative process. Greg Byrne delivered his closing argument to the jury. He admitted, "There's something fishy about those American for Tax Reform checks." And then noted, "If I&R did something wrong -- that's another lawsuit." He also informed jurors, "Those 990s may contain some things that are wrong. If it's a mistake, is that wrong?" Byrne even conceded that 22 - 23 (out of a total of 25) signatures on multiple, initiative statements of sponsorship were forged by OTU-EF employee, Kelli Highley -- including those for Measures 92 and 98. He asked jurors to review a number of exhibits and attempted to poke holes in the testimony provided by Becky Miller about doctoring OTU-EF Board minutes for the IRS audit. He told jurors that Bill Sizemore "lives under a microscope. No one has found anything wrong." He urged jurors to rule in favor of OTU enterprises. The trial enters its 13th day, Wednesday, September 25th at 9am. At that time there will be brief rebuttal to Bryne's closing arguments. Then the jury will receive instructions from Judge Jerome LaBarre and begin their del