State seeks reinstatement of charges against ex-trustees
By David Waite
Advertiser Staff Writer
A deputy attorney yesterday asked that theft charges against former Bishop Estate trustees Henry Peters and Richard "Dickie" Wong and developer Jeffrey Stone be reinstated, saying Circuit Judge Michael Town erred when he dismissed indictments against the three two years ago.
Deputy Attorney General Larry Goya told five substitute Hawai'i Supreme Court justices that Stone failed to prove his attorney-client privilege was violated when Stone's lawyer, Richard Frunzi, was called to testify before an O'ahu grand jury about a theft case the attorney general's office was attempting to establish against Peters, Wong and Stone.
Goya also argued that Peters failed to show that his attorney-client privilege was violated when Nathan Aipa, former Bishop Estate chief counsel, presented testimony to the grand jury. A contrary finding led Town to throw out a second theft indictment against Peters in December 1999, after Peters argued that Aipa effectively became Peter's personal attorney when he advised him on a natural gas investment that the trust and several individual trustees were about to make in the early 1990s.
Lawyers for Wong, Peters and Stone also argued in those cases that Frunzi "prejudiced" the views of jurors by announcing that he was testifying under a "crime/fraud exemption."
Attorneys are forbidden from revealing what their clients say to them except in cases where an attorney believes the client is committing a crime or fraud.
Peters and Stone were charged with theft in connection with the sale of Bishop Estate land under Kalele Kai, a Hawai'i Kai condominium, to Stone in 1995 for $21.9 million. Peters was accused of accepting a $192,000 kickback from Stone. Stone was indicted on charges of bribery, being an accomplice to theft and conspiracy. Those indictments were later dismissed.
In addition, Wong, his ex-wife, Mari, and Stone were charged with theft in a separate indictment stemming from the Kalele Kai sale. Town threw out that indictment because prosecutors "illegally bolstered" Frunzi's grand jury testimony.
Mari Stone was indicted on charges of conspiracy and hindering prosecution in 1999, in a case stemming from the sale of Bishop Estate property to Jeffrey Stone.
Goya said questions asked of Frunzi during the grand jury proceedings did not result in his giving answers that violated attorney-client privilege. Goya also said that Frunzi was only one of 21 witnesses who testified before the grand jury that returned charges against the Wong, his ex-wife and Stone.
But Wong's attorney, Eric Seitz, argued that Frunzi was essentially the only one asserting that Wong did anything illegal in the land sale.
The five regular Supreme Court justices recused themselves from hearing the matter because the Court is charged with filling vacancies on the board of Bishop Estate/Kamehameha Schools, which now calls itself Kamehameha Schools.
The stand-in justices were George Masuoka, Ronald Ibarra Daniel Kochi, Shackley Raffetto and Gary W.B. Chang.
Correction: Mari Stone was indicted on charges of conspiracy and hindering prosecution in 1999, in a case stemming from the sale of Bishop Estate property to developer Jeffrey Stone. Jeffrey Stone was indicted on charges of bribery, being an accomplice to theft and conspiracy. Those indictments were later dismissed. The charges were misidentified in a previous version of this story.
