Squabbling Jury Deadlocks on Charges Against Rubino

Amid signs of vicious infighting, jurors weighing the fate of former Budget Director Ronald S. Rubino told a judge Wednesday they were deadlocked in the first criminal trial to stem from the Orange County bankruptcy.

At the end of the fifth day of deliberations, Judge J. Stephen Czuleger told the jury of 11 women and one man to return today and spend at least one more hour in a final attempt to reach a unanimous verdict.

After jurors left the courtroom, Czuleger told lawyers in the case that he might have to declare a mistrial.

“If we don’t get any requests” from jurors who may have questions and “after any reasonable period of time, we’ll hang this jury,” Czuleger said.

As prospects for a hung jury grew, details emerged in court Wednesday that jurors had been bickering for nearly a week, in one case prompting a juror to leave the jury room last week “in a huff,” Czuleger said. The juror was “reluctant to return,” but later rejoined the others, the judge said.

Czuleger also said there were reports of jurors “ganging up on other jurors” and some personality clashes, but said the panel seemed to have resolved most of these “silly conflicts.”

One indication of the jury’s rancor came in a note sent to the judge.

“Do we as a jury have to prove to each other why we feel [Rubino] is not guilty or need to prove why he is guilty? We are hung up on this,” the forewoman wrote.

Czuleger responded that jurors had a duty to discus the facts and the law with other panelists but had no obligation to prove anything. The prosecution, he said, had to prove beyond a reasonable doubt that Rubino was guilty of the money-skimming charges.

Juror No. 9 appeared to be fighting back tears during the afternoon session.

Earlier in the day, Czuleger told the lawyers that he had received a note from Juror No. 9 about “personality differences among some of the jurors.” A resident of Orange, Juror No. 9 is a reference technician for the Tustin Unified School District, where she has worked since last year.

After receiving the juror’s note, Czuleger instructed the panel to put aside their differences. Their task, the judge said, was “far too important for you to engage in personal difficulties.”

The judge told jurors that they would be unfair to both sides in the case if they allowed personal conflicts to hinder their deliberations.

If the judge eventually declares a mistrial, prosecutors will have to decide whether to retry Rubino on two counts of helping then-Treasurer-Tax Collector Robert L. Citron skim $93 million in interest earnings belonging to cities, school districts and other government agencies.

One legal expert said a mistrial in the Rubino case could prompt prosecutors to reexamine their bankruptcy-related cases against other county officials.

“They’d better have stronger [evidence] than they have here, or they aren’t going to have positive results,” said Laurie L. Levenson, a former federal prosecutor and associate dean of Loyola Law School in Los Angeles. “It’s a wake-up call.”

During the three-week trial, prosecutors contended that Citron and Rubino agreed to distribute 7.85% in interest earnings to the 200 outside agencies in the county-run investment pool and siphon the remainder to a county reserve account--the Economic Uncertainty Fund--to generate additional income for the county.

Citron and Rubino plotted the diversion, prosecutors said, because Citron’s assistant treasurer, Matthew Raabe, was worried that investors might be startled by the unusually high interest that Citron’s investments were earning and withdraw their money from the pool.

But Citron, testifying as a prosecution witness , said he never told Rubino about the diversion. Rubino said that he never knew about the diversion scheme and that he was only following his superiors’ orders and county policies when he suggested that the additional interest be placed in the reserve account.

Rubino’s is the first criminal trial to emerge from Orange County’s bankruptcy. Citron is awaiting sentencing after pleading guilty to six felony counts of misappropriation and fraud. Raabe is expected to go to trial in January on the same fraud and misappropriation charges.

Citron’s inaccurate bets on interest rates caused the investment pool to suffer a $1.64-billion loss in the fall of 1994, triggering the largest municipal bankruptcy in U.S. history. The diversions were unearthed later by investigators.

In court Wednesday, jurors sent several notes to the judge indicating the confusion that has surfaced behind closed doors during the past week.

In one note, panel members asked if they had to find that Rubino simply knew about the transfer of funds or if he had to know that the transfer was illegal.

After consulting with prosecutors and the defense attorney, Czuleger summoned jurors to court and read this response: “Mere knowledge of the transfer of funds,” without anything more, is not a criminal act.

“If Rubino knew that the transfer of funds was unlawful and acted in a way to further the unlawful purpose of Robert Citron, it may be criminal if all other elements of the offense are met,” the judge wrote.

In previous instructions, the judge has said that to convict Rubino, jurors must find that “Rubino knew that the crime charged was being committed, knowingly did some act for the purpose of aiding, promoting, encouraging or instigating the crime, and did so with the intention of causing a crime.”

In a separate note, the panel asked if Rubino would have been guilty of a crime if he suspected that Citron was diverting interest and set up the Economic Uncertainty Fund anyway.

Czuleger responded that “actions which inadvertently aid a crime or mere knowledge that a crime is occurring and failing to stop it are not crimes.”

After reading Czuleger’s clarification of the law, jurors sent out a note at 3:16 p.m. stating that “the previous note you just gave back to us does not help and we still are a ‘hung jury.’ ”

Czuleger summoned jurors to the courtroom and told them that if they didn’t reach a verdict, the case may be retried and another panel “will likely face the same difficulties.”

“I ask you to keep an open mind,” the judge said. “It’s the court’s preference to have a verdict. . . .”

But Levenson of Loyola Law School said a mistrial could allow district attorney’s officials to strengthen any future prosecutions by giving them a chance to ask jurors where their case failed.

And she cautioned that personal bickering among jurors did not kill chances for a unified decision. Jurors in the federal trial involving the police beating of motorist Rodney G. King reached verdicts despite personal clashes, Levenson said.

* CITRON SENTENCING: Ex-treasurer will learn his fate in November, a judge said. B1