Adelphia Employee Testifies on Properties

Adelphia Communications Corp. never received legal title on some real estate it purchased in 1994 from the company’s founder, John Rigas, and entities owned by his family, an Adelphia employee testified Tuesday.

John Rigas, his sons Timothy and Michael Rigas and a fourth executive, Michael Mulcahey, are on trial in Manhattan on charges of fraud and conspiracy.

They are accused of misleading Adelphia creditors and investors and orchestrating a scheme that allowed the Rigases to use Adelphia, the nation’s fifth-largest cable television company, as a “personal piggy bank.” They have pleaded not guilty.

On Tuesday, prosecutors exhibited three 1994 contracts selling Adelphia different pieces of real estate.

Adelphia never received title on two of the properties in the contracts, which John Rigas signed on behalf of both the buyer and the seller, said Charles Raptis, former assistant to John Rigas and still an Adelphia employee.

The title on another Coudersport, Pa., property that Adelphia bought from a Rigas-owned entity for $115,000 wasn’t conveyed to Adelphia until March 1, 2004, nearly 10 years after the sale agreement, Raptis said.

The company’s headquarters formerly were in Coudersport but are now in Greenwood Village, Colo.

Earlier in the day, Adelphia won a federal judge’s approval of a settlement with its former telephone and Internet subsidiary.

Under the accord approved by U.S. Bankruptcy Judge Robert Gerber in New York, Adelphia will drop an $842-million claim, pay $60 million and buy $39 million of telecommunications services over five years from TelCove Inc., a former unit reorganizing in a separate bankruptcy. TelCove will drop as much as $1 billion in claims against Adelphia.

The settlement removes an obstacle to the companies’ efforts to come out of bankruptcy proceedings and complete a split that was hampered by their insolvency.

Associated Press and Bloomberg News were used in compiling this report.