Coupon fraud case bogs down in court [El Paso Times, Texas]
(El Paso Times (TX) Via Acquire Media NewsEdge) Apr. 3--EL PASO -- A 3-year-old coupon fraud case against 11 El Paso executives is mired in federal court in Milwaukee, as both sides argue over the admissibility of thousands of documents.
The El Paso businessmen formerly ran International Outsourcing Corp. They want the judge overseeing the case to declare thousands of e-mails and other documents as inadmissable in court because they are privileged attorney-client papers.
Federal prosecutors want to introduce those same e-mails as evidence. They say the documents contain only details of the company's operations and its handling of the coupons, according to court filings.
A 25-count indictment against IOS and the 11 executives alleged that they defrauded grocery stores out of $250 million by redeeming coupons that were never used by customers. The indictment alleges IOS officials gathered the unused coupons from retailers and then submitted them for redemption.
After reviewing the documents, a U.S. magistrate judge has given the defendants until April 15 to restate why the documents are privileged information.
"From the court's extensive review, it is apparent that the defendants did not properly review all of the logs before submitting them to the court," U.S. Magistrate Judge Patricia Gorence wrote in her order. "Based on the problems with numerous log entries, the court is unable to properly determine as to whether the stated privilege does, in fact, apply." Among those indicted by the grand jury in Milwaukee were former IOS chief executive officer Chris Balsiger and James Currey, founding partner and CEO of Currey Adkins, an El Paso technology services company that did work for IOS. Both pleaded not guilty and are free on bond.
Their lawyers have said they did nothing wrong and that a rival coupon company is behind the charges.
IOS was a national coupon-redemption company that had its headquarters in El Paso and Juarez. The company sponsored some of the city's most-well known events, such as the Amigo Airsho and a college golf tournament. Balsiger was on several city boards and commissions.
Balsiger and Currey want the federal court to classify approximately 2,179 documents as work products that are inadmissable in court. Three other former IOS executives and co-defendants, Bruce Furr, Lance Furr and Steven Furr, are asserting attorney-client privilege on about 241 documents.
Most of the documents were exchanges between IOS officials and attorneys at the Scott Hulse law firm in El Paso.
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