The two Henry T. Nicholases
Last week began and ended on high notes, sort of, for the billionaire Orange County crusader behind some of California’s most recent tough-on-crime ballot measures. On June 2, an anti-gang proposition that he is backing with $1 million from his personal fortune qualified as the sixth state measure (pdf) on the Nov. 4 ballot. That was joined on Friday by number nine, the centerpiece of his years-long public safety campaign -- a proposed victims’ rights initiative (pdf) named for his murdered sister.
The days in between were, well, less triumphant. Indictments were unsealed Thursday by a federal grand jury in Santa Ana, accusing the tough-on-crime benefactor -- Broadcom Corp. co-founder and former chief executive Henry T. Nicholas III -- of securities fraud and multiple drug crimes.
But that sounds so staid. In fact, the 18 pages (pdf) of the more colorful of the two indictments describe a drug-fueled, power-crazed rock star of the tech world who stocked a secret cavern under one of his homes with prostitutes and spiked the drinks of clients and employees with ecstasy. Valium and vicoprofen allegedly gushed into his lairs after cohorts fraudulently obtained prescriptions from a new Oz of narcotics, the pharmacy at the Pavilions grocery store in Newport Coast, just south of UC Irvine (which is enjoying a $40 million Nicholas donation). There were, it is claimed, cocaine and methamphetamine, private “escorts,” death threats, cover-ups and payoffs. News stories have zeroed in on what would be the money shot, if the indictment were turned into an HBO movie: a private jet so thick with his (and his friends’) marijuana smoke that the pilot had to put on an oxygen mask. Nicholas comes off as the Elvis of semiconductors, but more unhinged than the King ever was. The Phil Spector of microprocessors, but without the self-control.
The drier 65-page securities indictment (pdf) alleges backdating of stock options without properly reporting the transactions to the Securities and Exchange Commission. Nicholas, currently out on $3.4 million bail, is due to appear for arraignment Monday in Santa Ana.
Meanwhile, lawyers and reporters are poring over the previously reported details of two lawsuits and a (sealed) divorce proceeding that add to the image of self-indulgent dot-com-era excess. Ironies jump off the pages of legal complaints and campaign donation reports. There is Nicholas’ support, for example, of the Orange County Sheriff’s “Drug Use is Life Abuse” program. Or the fact that, according to the Los Angeles Daily Journal, he checked himself out of the Betty Ford Center late last month in order to hang out at the federal courthouse in Santa Ana -- to avoid the “perp walk” past TV cameras. Or the shadowy YouTube video that appears to show Nicholas using drugs, according to prosecutors.
Might any of this stuff pose a campaign problem for his two latest anti-crime measures?
Short answer: Duh. As in, yes. Nicholas released a statement Monday through the new committee that from now on will be running the campaign, saying he is giving up an active role in the drive to pass the “Crime Victims’ Bill of Rights Act of 2008: Marsy’s Law.”
The news release from Mitch Zak, partner with Randle Communications and lead strategist for the campaign, shows why top communications experts get paid the big bucks: “During the last week,” it said, “legal issues arose affecting one of the initiative’s major supporters, Dr. Henry Nicholas.... Dr. Nicholas has proactively acted to help the campaign move forward without distraction.”
Legal issues indeed.
Much has been written in business pages and on tech-world blogs about Nicholas as the arrogant business and engineering genius who joined with his professor, Henry Samueli, to build Broadcom, then gave it all up in 2003 to try to save his marriage and dote on his kids. There has been political coverage, as well, of the mastermind and pocketbook behind Republican-sponsored laws that stand no chance in the Democratic-controlled Capitol but are routinely embraced by California voters.
But there has been very little cross-referencing, leaving a bifurcated picture of the man. As the criminal matters work their way through the courts there will doubtless be much more in the news about the Broadcom bad boy Henry T. Nicholas; here is an abbreviated sketch of the direct democracy Henry T. Nicholas.
He is the son of an alcoholic lawyer, according to Times stories. His mother divorced his father and married journalist-turned-screenwriter Robert Leach; Henry and his sister Marsalee grew up with their mother and stepfather in 1960s Malibu. He studied engineering at UCLA.
Marsy was a senior at UC Santa Barbara when her ex-boyfriend, Kerry M. Conley, shot her to death. Conley was convicted of second-degree murder and sentenced to 17 years to life in prison.
Leach, the slain woman’s stepfather, co-founded Justice for Homicide Victims in 1984, two years after California voters adopted Proposition 8, the Victims’ Bill of Rights. He remained president of the group for most of its existence until his death March 30. His widow (and Henry T. Nicholas’ mother), Marcella Leach, remains the group’s executive director.
Nicholas became suddenly rich and famous in 1998, when Broadcom went public and he and more than 200 of his employees became instant millionaires.
In 2000, he opened his wallet for Proposition 21, one of 20 measures on the March ballot, which increased punishment for gang-related felonies, carjacking, witness intimidation and drive-by shootings. It also authorized wiretaps for certain gang activities. California voters passed it overwhelmingly.
It was the latest in a string of tough-on-crime initiatives passed by voters who believed that the state’s justice system coddled criminals. The pendulum appeared to be swinging back by 2004, when Proposition 66 -- a measure to soften the decade-old three strikes law -- consistently polled ahead prior to the November election. But Nicholas pumped $3.5 million into the no-on-66 campaign in the final weeks before the election and helped defeat the measure.
In 2006, he donated to the campaign for Proposition 83, California’s version of Jessica’s Law. Key provisions include mandatory life sentences for many forcible sex acts on children, eliminating good-time and work-time credit for sex offenders, and requiring lifetime electronic monitoring of convicted sex-offense felons.
In speaking to The Times’ editorial board in favor of Proposition 83, state Sen. George Runner (R-Lancaster) said he understood the frustration many Californians felt at facing so many ballot measures election after election. But he said it paled in comparison with the frustration they feel at Democrats in the Legislature, who will not allow Republican anti-crime legislation to even get a hearing in Sacramento. He may have been right; voters passed Proposition 83 overwhelmingly.
This November’s ballot brings two Nicholas measures: The Safe Neighborhoods Act, an anti-gang initiative sponsored by Runner, appropriating hundreds of millions of dollars for crime-fighting programs, softening rules against hearsay and establishing a host of programs to deter crime and punish criminals; and Marsy’s Law, also known as the Victims’ Rights Act of 2008, to greatly restrict an inmate’s access to parole and to raise to constitutional levels many provisions adopted into law by voters 24 years ago.
Nicholas gave $1 million to the anti-gang measure, and, so far, $4.8 million to the initiative named for his sister.
That latter measure has obvious personal resonance with the billionaire, and not just because of his sister’s death. His mother has spoken of seeing Conley, the killer, in the grocery store, free on bail, shortly after Marsy Nicholas’ funeral. (Conley died in prison last year.)
Along the way, Nicholas donated $1,000 to George W. Bush’s first presidential campaign, $1.5 million to Gov. Arnold Schwarzenegger and his political committees, and $11,200 to former Gov. Jerry Brown’s successful 2006 campaign for attorney general. That latter donation seems out of place, but in fact Nicholas worked closely with Brown, then mayor of Oakland, to defeat Proposition 66.
So what becomes of the two most recent measures without the considerable financial support of Henry T. Nicholas? And how badly will Nicholas’ own criminal proceedings hurt the effort? And, just as an ironic twist, how will Nicholas’ alleged drug problems affect a campaign from the other side of the ballot-measure spectrum -- an initiative to end prison time for drug offenders? It wouldn’t directly help Nicholas, even if it passed, because he is charged with federal crimes in federal court. But it could make the next several months more interesting.
Runner has released a statement saying he intends to move full-speed ahead on the anti-gang measure. Assemblyman Todd Spitzer (R-Irvine), with whom Nicholas has worked to create and fund a crime victims’ memorial at the Capitol, has said the same about Marsy’s law.
California voters are a quirky bunch and hard to predict. They could sympathize with Nicholas as a suspected drug offender and go to the polls to pass the sentencing reform. Or they could sympathize with Nicholas as a crime victim’s brother and go to the polls and pass his two measures to toughen the lot of convicted criminals. Or all of the above. Or they could finally tire of legislating by initiative.
But don’t count on it.
Robert Greene is a member of The Times’ editorial board.
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