Lawyers Defend Rigases’ Use of Company Planes

Attorneys for the Rigas family Tuesday defended their use of Adelphia corporate aircraft for golf trips to Pebble Beach and board meetings in Cancun, Mexico, arguing that the planes were used mostly for business.

Lawyers for the government had portrayed the Rigas family as having abused the corporate jets. They focused on Timothy Rigas, who they said used a company Gulfstream to squire actress Peta Wilson to the Caribbean and for golf junkets to Hilton Head, S.C.

Adelphia Communications Corp. founder John Rigas, sons Timothy and Michael and another former Adelphia executive, Michael Mulcahey, are standing trial in U.S. District Court in Manhattan, accused of looting the nation’s fifth-largest cable company before it collapsed in 2002.

All have pleaded not guilty to bank and wire fraud and making false statements to the Securities and Exchange Commission.

Under cross-examination, the manager of Adelphia’s three planes, George Cretekos, said he had no idea which trips were for business or personal purposes and that the company had no established method to distinguish between the two.

In testimony to a grand jury in 2002, Cretekos had said, “It seemed inappropriate for me to ask Mr. Rigas, ‘Why are you going on this trip?’ I didn’t feel it was appropriate to pry into their affairs.”

Adelphia’s two jets were typically used 400 times a year, he said, and a smaller, propeller-driven plane was used about 200 times.

Attorneys for the defense attempted to link each trip to a business purpose, including Timothy Rigas’ trip with Wilson to Montego Bay, Jamaica, noting that the flight continued to San Juan, Puerto Rico, where Adelphia owns an interest in a cable system.

The defense emphasized compassionate uses of the jets, noting that three Adelphia employees were flown to hospitals for cancer treatment and one was flown to her father’s side after a stroke.

Cretekos admitted that he, his wife and his daughter also used Adelphia aircraft at least 63 times, often for personal purposes, including golf trips. Cretekos said he attempted to reimburse Adelphia $2,000 for the trips, but his check was not accepted. The defense sought to damage Cretekos’ credibility, questioning him about a $15,000 raise and a $23,000 bonus paid to him by the current management of Adelphia in January, a month before he began cooperating as a witness for the government.

The current management of Adelphia is hoping to bring the company out of bankruptcy protection this year and has sued the Rigas family and other board members, hoping to recover some of the losses to the company.