Jury Sees Video of CEO's Posh Apartment
N E W Y O R K, Nov. 25, 2003 -- It turns out that $6,000 shower curtain is inthe maid's room.
Jurors in the Tyco International corporate larceny trial learnedtoday during a video tour of the $18 million company-ownedapartment where former Chief Executive Officer Dennis Kozlowskistayed when he was in New York City.
The 15-minute tape, recorded in May 2002 and July 2003, shows asumptuously appointed duplex occupying the 10th and 11th floors of950 Fifth Ave. Besides the purchase price, prosecutors say, some$14 million was spent to renovate and furnish it.
Entry to the lavish flat was through a 20-foot-by-20-foot foyerdecorated with $500,000 worth of hand-painted birds, according toJohn Taylor, Tyco's director of construction for five years untillast June.
The video tour guide was Mariola Tarnachowicz, the Kozlowskis'former housekeeper. As the camera moved through the apartment,Tarnachowicz identified the rooms and several objects pointed outby Assistant District Attorney Consuelo Fernandez.
Art, Fancy Curtain
The videotape shows at least a dozen paintings, including aMonet and a Renoir, a $2,200 wastebasket, as well as thenow-infamous $15,000 umbrella stand. The stand is a sculptedterrier on its hind legs with a brass ring through its paws to holdumbrellas.
Tarnachowicz, who made more than $80,000 the year before Tycofired her last May, pointed out the $6,000 shower curtain. Thecurtain, in a gold-and-burgundy floral pattern, was in the maid'sbathroom.
Tarnachowicz said one had to go through at least two doors tosee the curtain, raising the possibility that Kozlowski never sawit after it was in the apartment.
She also said Kozlowski never lived in the corporate apartmentand stayed there infrequently. Sometimes he was there one or twodays out of a week, sometimes for a month, and occasionally hewould show up just to change clothes.
The former maid also said she often had been treated like aguest in the Kozlowskis' homes and had invited them to her own homefor dinner. Tarnachowicz said she once cooked a large meal ofPolish food for Kozlowski.
Kozlowski's wife, Karen, sitting in the audience, started weeping. "Shesaid some very nice things about us," she said later. "For once,it's nice to hear."
The former CEO said he also appreciated the things Tarnachowiczsaid about him. "She's very nice," he said. "She's been likefamily to us."
Unauthorized Bonuses
Kozlowski, 56, and Tyco's former chief financial officer, MarkSwartz, 43, are on trial in Manhattan's state Supreme Court chargedwith grand larceny and enterprise corruption. They are accused ofstealing some $600 million from Tyco. Each faces up to 30 years inprison if convicted.
Prosecutors allege that Kozlowski and Swartz stole $170 millionby taking and hiding unauthorized pay and bonuses, raiding companyloan programs and forgiving loans to themselves. They say thedefendants made another $430 million on their Tyco stock by lyingabout the conglomerate's financial condition from 1995 into 2002.
Defense lawyers say Kozlowski and Swartz earned all the benefitsthey got from Tyco and that all the appropriate overseers knewabout their compensation and loans.
After the pricey shower curtain and umbrella stand made newslast fall, they quickly became symbols of executive greed.
Prosecutors apparently hope those objects and other excessesallegedly paid for by Tyco have a negative impact on the jury.
Defense lawyers blunted the effect of testimony by Taylor andTarnachowicz by asking both whether Kozlowski or Swartz had everasked them to charge either of the executives' expenses to thecompany, or lie about any expenditures.
Taylor, who had worked on properties for both executives, saidthey had not.
"Did Dennis ever ask you to lie to anyone about anything?"Stephen Kaufman, Kozlowski's lawyer, asked Tarnachowicz.
"No, he didn't," she replied.
The trial resumes Monday.