Some information in this story has been corrected from what was originally published.
Judges on the U.S. Fourth Circuit Court of Appeals hearing an appeal of South Carolina banker Russell Laffitte’s 2022 conviction for bank fraud questioned attorneys Wednesday about the unusual late-hour dismissal of two jurors during Laffitte’s trial.
At least two of the judges seemed skeptical of the actions of U.S. Judge Richard Gergel, who dismissed the jurors and substituted two fresh ones, and questioned whether Gergel’s actions in the case of at least one excused juror had violated Laffitte’s constitutional rights.
Gergel had questioned the juror out of the presence of Laffitte’s lawyers. Laffitte attorney Billy Wilkins told the three appeals court judges that while Laffitte’s lawyers waived his right to be present during the judge’s questioning of that juror, the lawyers did not waive their right to be present when Gergel made the decision to release that juror had been violated. That was a violation of Laffitte’s consitutional rights, Wilkins said.
Assistant U.S. Attorney Katie Stoughton, arguing after Wilkins, disagreed. She said the government believes that the record shows Laffitte’s trial attorneys waived any challenge to the judge’s finding that the juror needed to be excused.
At Laffitte’s trial, just 50 minutes after Gergel excused the two jurors and replaced them with alternates, the newly-constituted jury found Laffitte guilty of six counts of conspiracy, bank and wire fraud and misapplication of bank funds.
The dismissed jurors may have been holding out for Laffitte. One of them told Gergel she was feeling pressured to change her vote, according to court records. At that point, around 8:30 p.m. with a long holiday weekend looming, the jury had been deliberating more than 10 hours.
A Laffitte brief in the case before the appeals court judges said, “This appeal arises from an extraordinary criminal case in which the district judge’s (Gergel’s) actions during jury deliberations created a fundamental defect in the trial and violated an innocent defendant’s basic rights.”
A government brief in the case noted that if Gergel had improperly dismissed the two jurors, it was harmless error. And “ overwhelming evidence supported Laffitte’s guilt on all six counts,” the brief said.
The government’s brief also said that defense trial lawyers failed to raise timely or appropriate objections to Gergel’s removal of the jurors, and in any case, their removal “did not affect Laffitte’s substantial rights.”
The verdict against Laffitte ended a three-week trial that also put disgraced attorney and now-convicted murderer Alex Murdaugh in the spotlight. Evidence in the case showed that Laffitte, then president and CEO of Palmetto State Bank, had conspired with Murdaugh to misappropriate millions of dollars in clients’ funds. Murdaugh had steered the money toward Laffitte’s bank. The trial was held in federal court in Charleston.
Laffitte was sentenced to seven years in federal prison by Gergel.
Murdaugh pleaded guilty in federal court to numerous financial crimes and was sentenced to 40 years in federal prison. Murdaugh is now appealing that sentence as cruel and unusual punishment, saying it is far more than other white collar crime cases.
The judges on the appeals court panel — Steven Agee, Toby Heytens and Stephanie Thacker — could uphold Laffitte’s conviction, decide the juror issue was an error but rule it “harmless,” or grant Laffitte a new trial.
The case was argued in Richmond, Va.
Laffitte is now an inmate at Coleman federal prison, a low security institution, in Florida. His release date is April 20, 2029.
Arguing to uphold the verdict were assistant U.S. Attorneys Katie Stoughton and Emily Limehouse.
Besides Wilkins, John Nieman Jr. argued for Laffitte. Columbia attorneys Mark Moore and Michael A. Parente also represent Laffitte. Laffitte’s attorneys at his trial, Bart Daniel and Matt Austin, no longer represent him.
A state grand jury has indicted Laffitte on state charges similar to the federal charges on which he was found guilty. The state charges are pending.
No date for a trial on Laffitte’s state charges has been announced, according to the S.C. Attorney General’s office.
(Editor’s note: This story has been corrected to say the specific objection that Laffitte’s attorneys had to Gergel’s dismissal of one juror was that Laffitte’s lawyers were not present when the juror was dismissed.)
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