The_Info_Web/10 - PEOPLE/(A-G)/Cornelius Blackshear.md

category	tags	summary
Law Enforcement & Legal	Person PROMIS INSLAW	Cornelius Blackshear was a U.S.

Cornelius Blackshear was a U.S. Trustee in the U.S. Attorney's Office for the Southern District of New York who later became a U.S. Bankruptcy Court Judge for the Southern District of New York. He became a key figure in the allegations surrounding the attempted conversion of INSLAW's bankruptcy case and a subsequent alleged cover-up.

Blackshear initially testified in a deposition on March 25, 1987, that William White, the U.S. Trustee for the District of Columbia, had told him that Thomas Stanton, Director of the Executive Office of U.S. Trustees (EOUST), had tried to pressure White to convert INSLAW's Chapter 11 reorganization to a Chapter 7 liquidation and to have Harry Jones assigned to White to effect the conversion. Blackshear also stated that Stanton had never contacted him about detailing Jones, but he thought Stanton might have approached Jones directly. This testimony supported Inslaw's primary allegation of a plot to liquidate the company. However, after speaking with White, Blackshear realized he was mistaken and had confused Inslaw with the UPI case, about which White had told him the IRS had pressured him to join a motion to convert. Blackshear then prepared and signed, with the assistance of his attorney (an Assistant United States Attorney in the Civil Division of the U.S. Attorney's Office for the Southern District of New York, named in the report as James Garrity), an affidavit recanting his deposition testimony, stating that he had confused the cases. He also gave a second deposition repeating his new recollections. During the Office of Professional Responsibility (OPR) investigation, Blackshear essentially repeated his recanting statements, maintaining that White had not told him Stanton pressured him to convert Inslaw, and that he had confused Inslaw with UPI. He did, however, disagree with White regarding a conversation about the possible assignment of Harry Jones to Washington, believing White had told him Stanton planned to bring Jones to Washington, while White maintained Blackshear told this to White. Blackshear also denied discussing with Anthony Pasciuto at a social gathering that he was sorry for his conduct or had given false testimony in his recantation to avoid hurting people.¹

The recantation

Blackshear first swore on March 25, 1987, that White told him Stanton wanted the Inslaw case converted. The House Judiciary Committee reported that Judge Jane Solomon told its investigators that on March 18, 1987, Blackshear gave her an identical account, and that Pasciuto swore to the committee that Blackshear described Stanton's attempt to pressure him at a January 1987 luncheon.² The Bua report states that Blackshear and the other luncheon guest, Judge Lawrence Pierce, do not remember anything being said about Inslaw.³

White had been deposed shortly before Blackshear and had testified that Stanton exerted no pressure. When White learned that Blackshear had testified differently he telephoned him and told him he was mistaken. The Bua report states that James Garrity, then an Assistant U.S. Attorney in the Southern District of New York, represented Blackshear and accompanied him to the deposition. The next day Garrity received a call from Roger M. Cooper, the DOJ trial attorney defending the Independent Handling claims, who said he believed Blackshear's testimony was wrong and that DOJ was concerned that something should be done to correct the error; Cooper did not suggest what the correct testimony would be. Garrity spoke to Blackshear, who said that after speaking with White he had become convinced he had made a mistake, and the two prepared the recanting affidavit, which Garrity sent to Cooper.⁴ The House committee dated the affidavit March 26, 1987, and wrote that it was "highly questionable how the Department could ethically represent both itself and Judge Blackshear in the INSLAW litigation," because Garrity was a Department attorney at the same time as he represented a key witness for the plaintiff.² The Bua report wrote that these facts indicated conduct consistent with the good faith effort expected of attorneys.⁴

What the recantation left standing: Blackshear continued to maintain that White told him the IRS pressured White to move to convert the UPI case, and he disagreed with White about a conversation concerning the assignment of Harry Jones to Washington. In a sworn statement to House investigators on January 25, 1991, he said his earlier information was hearsay, largely from Pasciuto, and said of the choice between his account and White's: "it would become a credibility question." The House committee headed that part of its report "Judge Blackshear's statement to committee lacks credibility."² Pasciuto claimed that Blackshear had admitted giving false testimony in the recantation to avoid hurting people; Blackshear denied it.³

The Associated Press reported in May 1988 that Pasciuto's attorney, Gary Simpson, quoted Blackshear in a March 17 letter to the Justice Department as saying, "I felt less people would be hurt if I just bailed out," and "I thought that by changing my story I would hurt less people."⁵ Bason accepted Blackshear's original testimony as true and found the recantation an honest mistake; in January 1991 he filed a complaint with the Judicial Council of the Second Circuit stating that Blackshear recanted "not because of an honest mistake but because he made a conscious choice to testify falsely."⁶ DOJ's Office of Professional Responsibility, in a report of March 31, 1989, credited the recantation. The Bua report wrote that "[t]his series of contradictory statements can only be described as troubling," that "[a]t best, it reveals a rather malleable witness," and that "there simply is not sufficient evidence to prove (by any standard) that Blackshear lied when he recanted his deposition testimony."³

Bankruptcy Judge Bason, in his findings, chose to believe Blackshear's original testimony and found his recantation to be the result of an "honest mistake." However, several years later, in January 1991, Bason filed a complaint against Blackshear with the Judicial Council of the Second Circuit Court of Appeals, stating that he now believed Blackshear recanted not due to an honest mistake but because he made a conscious choice to testify falsely. The OPR, however, credited Blackshear's recantation, noting that he had no apparent motive to lie about the matter. The Senate Permanent Subcommittee on Investigations (PSI) found Blackshear's recantation implausible, noting that he had stated on four occasions prior to his recantation that White told him about pressure from Stanton to convert the Inslaw case. The PSI also found no evidence to support Blackshear's explanation that he had confused Inslaw with the UPI case. The Special Counsel's investigation concluded that there was insufficient evidence to prove that Blackshear lied when he recanted his deposition testimony. The report acknowledged the confusion arising from Blackshear's various statements but attributed it to poor memory rather than intentional misstatements. The Special Counsel found no reason why Blackshear, a sitting bankruptcy judge, would commit perjury and jeopardize his career.¹

Footnotes

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1. U.S. Department of Justice. Report of Special Counsel Nicholas J. Bua to the Attorney General of the United States Regarding the Allegations of Inslaw, Inc. March 1993, pp. 192-194, 195-197, 209-210 and 215-231. ↩︎

2. U.S. House of Representatives, Committee on the Judiciary. The INSLAW Affair. H. Rept. 102-857, 102d Cong., 2d sess., September 10, 1992, Part V, pp. 73-77 (affidavit of March 26, 1987; Garrity; January 25, 1991 statement; heading of section V.B). ↩︎

3. U.S. Department of Justice. Report of Special Counsel Nicholas J. Bua to the Attorney General of the United States Regarding the Allegations of Inslaw, Inc. March 1993, pp. 192-194, 195-196, 209, 215-223. https://archive.org/details/doj-oip-inslaw-1993 ↩︎

4. U.S. Department of Justice. Report of Special Counsel Nicholas J. Bua to the Attorney General of the United States Regarding the Allegations of Inslaw, Inc. March 1993, pp. 229-230. https://archive.org/details/doj-oip-inslaw-1993 ↩︎

5. Associated Press, "U.S. Probing Possible Perjury in Inslaw Case," Los Angeles Times, May 6, 1988, Part IV, pp. 9, 12. https://www.newspapers.com/image/404305287/ ↩︎

6. U.S. House of Representatives, Committee on the Judiciary. The INSLAW Affair. H. Rept. 102-857, 102d Cong., 2d sess., September 10, 1992, Part V.D, p. 78 (Bason's complaint of January 2, 1991). ↩︎