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The Honolulu Advertiser
Posted on: Tuesday, January 4, 2005

Trial reset for May 10 in Unity House case

By Jim Dooley
Advertiser Staff Writer

The criminal trial of former Unity House, Inc. executives Tony Rutledge Sr. and his son, Aaron Rutledge, was postponed for five months yesterday and is set to begin May 10 in federal court.

The trial was delayed by last month's seizure of Unity House by Internal Revenue Service agents and the filing of new criminal charges against the Rutledges.

Chief U.S. District Judge David Ezra set the new trial date and ordered the government to turn over to defense attorneys documents justifying the seizure of Unity House and the freezing of its estimated $42 million in assets.

Those records, filed under seal last month, include a sworn declaration from IRS agent Greg Miki as well as numerous exhibits cited by the U.S. Attorney's office as evidence that Unity House assets were at risk if left under the control of Unity House management, including the Rutledges.

Special U.S. Attorney Ted Groves argued that some of the material should remain under seal because of a continuing federal grand jury investigation. Ezra said he would review the records privately to determine if the government's arguments were valid.

Ezra said the seizure of Unity House was "clearly an extraordinary matter" that he had seen in just "a handful of cases" around the country.

The government made a similar seizure during its criminal investigation of the financial collapse of Enron Corp., Ezra said.

The judge closed the courtroom to the public yesterday to take up a final motion dealing with grand jury evidence related to a government effort to disqualify Tony Rutledge's attorney from the case.

Reach Jim Dooley at 535-2447 or at jdooley@honoluluadvertiser.com