Prosecution Wraps Case In Trial Of Seifert, Early

After a shaky first week, prosecutors gained some ground last week in the trial of Shona Seifert and Thomas Early, putting a string of executives on the stand who turned on their former colleagues. Later in the week, the defense began making its own case. Seifert and Early are accused of orchestrating a massive timesheet inflation scheme while at Ogilvy & Mather in an attempt to claw back a $3 million revenue shortfall on the $1 billion White House Office of National Drug Control Policy account. Both have pled not guilty.

Seifert’s courtroom demeanor changed somewhat as testimony dragged into its eighth day. In the first week, she was cheerful and upbeat. Last week she seemed more subdued and serious, as she whispered with her counsel and with her husband, John Seifert, a current Ogilvy employee who has been in court every day. Early remained a stoic and expressionless presence in the courtroom.

Here are highlights from four days last week in downtown Manhattan’s U.S. District Court (the court was closed on Friday):


Ogilvy’s former national broadcast director, Peter Chrisanthopoulos, surfaced in public for the first time in 14 months to describe a stormy meeting with former finance director Early and former senior partner/New York media director Ray Simko. A fuming Early said that if they didn’t start ballooning their timesheet records on ONDCP, their bonuses might be in jeopardy, Chrisanthopoulos testified. “He was angry and yelling,” he said of Early. After five minutes, “Ray got up, angry, and opened the door, walked out, and I followed him. Ray said, ‘What a jerk! What an ass!’ He would have to tell [former U.S. media director] Larry Cole about this.” Still, Chrisanthopoulos said he instructed his assistant and others to over-report their hours on ONDCP. Account executive Mabel Chin took the stand and described how she and executives in Ogilvy’s print department planned to bury a $300,000 overspend on an IBM account by billing the extra labor to ONDCP and inflating next year’s bills for IBM. “The overall [IBM] budget has been padded to cover the overage,” she wrote to her colleagues in an e-mail. “It looks like new product.”


Jon Swallen, Ogilvy’s former director of media research (now director of research at TNS Media Intelligence), illustrated the sub-rosa nature of the scheme by recounting a stilted conversation he had with former Ogilvy strategic planning director Bob Zach in 1999. Zach, he said, asked him to “reflect” on his timesheets for ONDCP, which had not met the “target” of 50 percent of his time. Swallen said he wanted Zach to say directly if he wanted the numbers to be faked. “No matter how hard I pushed … I was only going to get certain replies” from Zach, Swallen said. But Swallen said he got the message and redid all his old timesheets. A government accountant then testified that despite having the account beginning January of 1999, the agency did not manage to submit its first bill until September. When it did, the accountant said, the voucher—consisting of more than 10,000 sheets of paper—was riddled with errors, crossed-out text, white-out, “re-billing” efforts and correction tape. It took 360 hours to decipher it, the witness said.


Patrick Sullivan, a former agent for the Government Accountability Office, described how he ambushed Seifert in her office in September 2000 in order to interrogate her about the agency’s billing. Seifert told him she was “shocked” at the allegations, Sullivan said, and that “she had never heard of any discussion … that there was any shortfall [in the agency’s revenue on the business]. … It was the first she had heard of that.” Early told him a similar story the next day, he said. The jury had heard multiple witnesses in the previous week discuss how the shortfall was identified months earlier. The jury also got a look inside Seifert’s desk calendar. One entry, for 5 p.m. on Dec. 21, 1999, read simply: “See Tom early re financial issues f/up.” No explanation was given for “f/up.” The defense successfully persuaded the judge to delay the trial for a day so one juror could attend the Grammy Awards.


After finishing with its witnesses, the prosecution rested its case, and defense lawyers opened theirs. They called Lily Pu, former director of strategic planning on ONDCP, who described the account as a demanding, high-profile assignment and praised Seifert. “I don’t think I’ve ever worked with someone who is more inspiring,” she said. Seifert never approached her about timesheets and never gave directives regarding timesheets at meetings, she said. Pu pointed to Al DiOrio, whom she described as sloppy and overweight and not fitting into the Ogilvy culture. “He was the guy that always talked about timesheets,” she said. Ogilvy senior partner, account director Margaret Bessette echoed those sentiments about Seifert. On cross-examination with both witnesses, the prosecution intimated that Seifert’s skills at inspiring her staff might have been what allowed her to get them to doctor their timesheets. Former ONDCP director Alan Levitt was also called as a defense witness. He lauded Ogilvy and Seifert. “Ogilvy was superb. If I could hire them again, I’d do it in a heartbeat,” he said. He also painted former ONDCP accountant Richard Pleffner, the man who reported Ogilvy’s alleged billing inconsistencies, as an unreasonable bean counter loathed by the agencies doing anti-drug work.

The trial continues on Tuesday morning.