Broad Grilled Over Apparent Inconsistencies
Taking the stand Wednesday in a highly contentious lawsuit, billionaire businessman Eli Broad came under a brief--but intense--cross-examination in which opposing attorneys grilled him over apparently inconsistent testimony.
Attorneys representing Jeffrey M. Gault, a former partner whom Broad is suing for breach of contract, hammered at the high-profile philanthropist for giving differing accounts under oath about his personal business discussions with Gault.
In morning testimony under questioning from his own attorney, Broad gave detailed accounts of several conversations in which he and Gault fashioned a partnership arrangement. SunAmerica, of which Broad is chief executive, hired Gault, himself a multimillionaire, in 1990 to scout out potential real estate deals.
Broad, 66, described how he met Gault, 55, and the terms of their agreement--even recalling specific phrases such as “deal flow” and “investment opportunity.”
But Gault’s attorneys seized on those words and attempted to show that Broad had contradicted himself. As a dramatic flourish, they used a large video screen to display portions of an October 1998 deposition in which Broad said he “did not recall” any conversations with Gault.
“When you gave testimony last year, were you aware of the penalties for perjury?” Gault’s attorney Raymond Riley asked Broad, who answered in the affirmative.
Pointing to the video screen, Riley responded: “Is that testimony true?” Broad replied: “Yes.”
The charged cross-examination capped an otherwise low-key day of testimony by Broad, who was making only his third appearance in court since 1957. His company filed suit against Gault and is asking for $126 million in damages.
SunAmerica hired Gault in 1990 to scout real estate investments for its growing portfolio. But after one investment went awry, Gault and SunAmerica terminated their exclusive arrangement in October 1994.
The company sued Gault a year later, claiming that he concealed information on two real estate ventures before the termination. Gault invested in the properties, which included the Buena Park Mall in Orange County, along with the Chicago-based Pritzker family, which owns the Hyatt hotel chain.
Gault acknowledges that he knew about the properties while he worked for SunAmerica, but he argues that they were not ripe for investment until after the 1994 termination.
Meanwhile, his attorneys say Broad is pursuing the suit, which has dragged on four years, partly out of ill feelings toward their client.
Yet during a morning break in Wednesday’s proceedings, Broad vehemently denied that characterization.
“They’re trying to portray this as a blood feud, and that’s nonsense,” he said. “I have no animus with Jeff Gault. I happen to like Jeff Gault.”
While on the stand, Broad even praised his onetime business partner as having negotiating savvy, effective networking skills and an outgoing nature.
Broad said he decided to testify at the trial, which began Oct. 12, because it would “look very bad” if he didn’t. The case is being heard by Superior Court Judge Judith C. Chirlin, who will decide the outcome.
The billionaire also said Gault’s attorneys’ attempt to make him look like a liar were grounded in desperation, not fact. He adamantly denied committing perjury.
“They . . . have a weak defense,” said Broad, who used a football analogy. “They are throwing a lot of Hail Marys out there.”.
Broad’s appearance in the fourth-floor courtroom downtown drew a packed crowd. Among the spectators were Gault and his wife, Adele. Gault declined to comment.
Broad is scheduled to take the stand again this morning.
