The Demoulas Trap
Secret tape recordings. Clandestine meetings. Fake identities. Nothing was off-limits when supermarket tycoon Telemachus Demoulas’s desperate legal team hatched its plan to squeeze Paul Walsh.
It was a muddy spring day when a two-bit lawyer and his private-eye sidekick met in a secluded glade deep inside the pastoral Forest Hills Cemetery in Jamaica Plain. They sat on a granite bench under the Citizen Soldier statue, an 1867 memorial to Roxbury’s Civil War dead, a spot where they hatched schemes to dig up dirt for their clients.
Their assignment on that April day in 1997 was to get the drop on flamboyant Superior Court Judge Maria Lopez, who was making things difficult for their increasingly desperate patron, supermarket tycoon Telemachus Demoulas. Her recent rulings were about to cost Telemachus’s family $1 billion in assets. She had to be stopped.
Kevin Curry and Ernest Reid were likely a little desperate themselves. A former lawyer in state Attorney General Robert Quinn’s patronage-heavy regime, Curry had worked for two decades with Reid, a self-styled Mickey Spillane who drove a big blue Impala loaded with antennas and made it up as he went along. They apparently snaked into the Demoulas case through a Lowell lawyer who tipped them off to the high anxiety in Telemachus’s camp. For two years the pair stoked their client’s paranoia, and used smoke and mirrors to explain their lack of real progress. But now they had to deliver something hard and fast—or they were out. Their options were dwindling: They needed to flip the clerk.
Back in 1995, Lopez’s then clerk, Paul Walsh, had helped write the latest decision in the endlessly contentious Demoulas supermarket case. It was the final step in the judge’s doing the unthinkable: She had ordered Telemachus’s side of the family to turn over stores and stock it had hidden and stolen over nearly two decades from the addled widow and spoiled children of Telemachus’s late brother, George. What’s more, the Supreme Judicial Court had recently affirmed Lopez’s handling of the 1995 hearing, rejecting Telemachus’s appeals that she had prejudged the case based on an earlier jury trial that also went against Telemachus. The whole thing was all but over.
But Curry had other ideas that would keep the meter running toward the $140,000 or so in fees he and his partner would ultimately collect. If he could get Walsh to turn on Lopez and admit that she had decided the winners before the case began, the Superior Court might grant Telemachus a new trial in front of a new judge.
The plan was simple but creative. Curry had learned that Walsh had his sights set on a job overseas in corporate law. With Reid’s help, he decided to confect Walsh’s dream position and lure him to a fake interview. They’d spring the trap in Nova Scotia—where secret tape recording is legal—and get Walsh talking about the Demoulas case. Then they’d use whatever stuck to the wall to go after Lopez.
Curry and Reid had no idea the plot they were hatching in the cemetery would roil the Boston legal community for the next decade. They only knew they had a frantic client, and this muddy road looked like the last avenue left. They easily sold it to Telemachus Demoulas’s only son, Arthur T., who was scrambling for options from the family bunker in Tewksbury. Then they headed north.
Paul Walsh arrived at the Citadel Halifax Hotel in Nova Scotia’s capital on June 5, 1997, buoyant about his sudden prospects for moving up in the world. A corporate headhunter, a guy named Reid, had called out of the blue and described Walsh’s dream job: in-house counsel for a London-based global firm with offices in Boston and Bermuda. He gave Walsh a plane ticket and $300 cash for the trip.
In the hotel conference room, Walsh was welcomed by a man dressed all in black. The man handed him a business card that read “Kevin P. Concave, director of operations” for a company called British Pacific Surplus Risks Ltd. I put out the fires, he explained.
Concave told Walsh he was an expatriate who had fled to Canada to dodge the Vietnam War. “We’re both a pair of Irishmen,” he said. “The last guy Reid sent me weighed 300 pounds, had yellow teeth and a Dutch-boy haircut. You’re a good-looking guy. We’re going to get along.”
Later, Walsh would testify, Concave wandered into some weird territory, mentioning not wanting to work with lesbians or gays. At one point, after Walsh said he enjoyed surfing in Costa Rica, Concave launched into an odd riff about dark-skinned and light-skinned blacks. Concave wondered if Walsh had observed whether darker blacks were poorer in Costa Rica. Walsh blinked back confusion and said he hadn’t noticed.
Finally, they started talking business. Concave focused on Walsh’s writing skills and the preparation of the complicated Demoulas decision, which Walsh had sent to Reid as an example of his work. But then their conversation drifted again: Concave wanted to know what Walsh thought about Lopez as a judge and as a person, and about her Cuban ancestry.
Walsh said he had written the Demoulas decision alone, and then foolishly he cut up several judges, including Lopez, for being lazy. Afterward, Walsh headed back to Boston, blithely unaware that “Concave” was Kevin Curry, a lawyer with offices on Congress Street.
Once home, Curry presented the harebrained subterfuge as a smash hit. He debriefed Arthur T. at a needlessly furtive meeting on a hillside near the Demoulas headquarters. Walsh said he’d written the Demoulas decision “word for word,” Curry gushed, and that Lopez had predecided the case’s outcome. “I think we got him,” he said.
The Demoulas family’s Greek tragedy began in a neighborhood grocery store in Lowell. Telemachus and his brother, George, got rich after expanding the family supermarket into a chain in the ’50s and ’60s, and after George’s sudden death in 1971, the avuncular Telemachus dutifully tended the finances of George’s wife and four children. He bought them liquor stores and expensive condos. Then an innocuous inquiry from a state auditor in 1987 unraveled nearly 20 years of familial perfidy. It was eventually shown that some of the documents Telemachus had his brother’s family sign had stealthily transformed the 50-50 business into a 90-10 one.
George’s sons sued “Uncle Mike” for fraud, and the civil case mushroomed into the costliest and nastiest in state history. One cousin punched another in the back of the courtroom. At one point, a lawyer heaved a law book across the room when a ruling didn’t go his way.
But the Walsh affair took the case to new depths. It blared the question seldom asked in even a whisper in legal circles: How low can you go?
Gary Crossen entered the Demoulas fray in the summer of 1991, not long after a stint with the U.S. Attorney’s Office. His first assignment for Arthur T. was a long-shot case in federal court, making claims that family foes had bugged the Demoulas headquarters. The headline-grabbing move—one of the key witnesses was a former stripper—temporarily diverted attention away from the grubby fraud case against Telemachus. But a jury quickly shot it down.
Crossen took command of the Walsh affair a few days after Nova Scotia. None of Demoulas’s attorneys really trusted Curry—one of them dismissed him as a “bottom dweller”—so Arthur T. looked for more-seasoned litigators to turn Curry’s handiwork into something usable. Crossen fit the bill perfectly. A partner in the old-line firm of Foley Hoag & Eliot, he was a former ethics adviser to Governor William Weld, and head of the judicial nominating commission that screens lawyers seeking appointments to the bench. He also had a decade’s worth of experience running undercover operations. For all of this, Arthur T. was willing to pay top dollar: Foley Hoag ultimately took in between $1 million and $2 million from the case.
Crossen was paired with Richard Donahue, a graybeard who had once served as president of the Massachusetts Bar Association and chairman of the Board of Bar Overseers (BBO), the legal profession’s discipline committee. He was close to the Kennedy family and had made a fortune as president and chief operating officer of Nike. A distraught Telemachus had hired him to coordinate courtroom strategy and handle PR. But mostly, he got out of Crossen’s way.
The notion that Lopez had predetermined the result of the case before her, if true, would be a clear demonstration of judicial misconduct. Crossen viewed it as “troubling and important,” with alluring potential as a legal strategy. Though not everyone on the Demoulas legal team agreed, just maybe the issue could be used to force a new trial.
A fast, fateful decision was made. Crossen would pull a second job-offer ruse, but he’d take it up a notch: a new, higher-ranking executive from British Pacific, at a meeting that would take place at the Four Seasons in New York City (where secret taping is also legal). Sure, it was high-risk but, well, the game was already under way, and the client seemed to like where it was going. And besides, anyone got a better idea?
Donahue appeared to make a fateful decision of his own—to defer to Crossen’s experience in running undercover investigations and to disregard concerns about the plan voiced by members of his own team. Edward Barshak, former president of the Boston Bar Association, was serving as a consultant to Telemachus’s lawyers. He had strong reservations about Curry’s character and argued against continuing the British Pacific caper at all. Ultimately, Crossen and Donahue ignored those concerns. Big money was on the table. “We have a client and the client wants to proceed and it’s necessary to at least pay some attention to the client,” Donahue later said. “Otherwise, you won’t have any.”
A fortnight after Nova Scotia, a Mercedes limousine picked Walsh up at LaGuardia. He was ushered into a suite at the Four Seasons and greeted by a man named Peter O’Hara, whose card said he was a general manager at British Pacific. He told Walsh the catastrophic-risk insurance company was looking for new blood. After some job interview small talk, the discussion swerved into the Demoulas case. O’Hara—really Peter Rush, a former U.S. Secret Service agent with a tape recorder strapped to his back—peppered Walsh with questions. Walsh conceded that Lopez had decided early on who was telling the truth, but he added that she had been fully engaged, participating in an editor-reporter kind of way and discussing the evidence as it came in. “I think she kept some sense of open-mindedness,” Walsh said.
This wasn’t what Crossen, sequestered in the next room, was looking for. Not at all. He needed Walsh to say unequivocally that Lopez had her mind made up in advance. O’Hara pushed harder. Of the final 84 questions, nearly half concerned the Demoulas decision. Another six concerned a certain letter that had supported Walsh’s application to the Massachusetts bar. Such character reference letters are supposed to come from someone who knows the applicant personally, but because one of Walsh’s sponsors backed out at the last minute, this one was signed by a friend of a friend. O’Hara’s questioning about it struck Walsh as strange, but he’d talk about whatever O’Hara wanted if it would get him and his young wife on a plane to London.
Burly and baby-faced, Walsh grew up in a close blue-collar household in Milton, the seventh of eight children and youngest son of plumber-nurse parents. His high-energy mother, Margaret, was the stationmaster of a bustling house where the trains ran on time, and on a budget. Eating out meant an annual visit to the old European Restaurant in the North End. But his grandparents had a summer house in Marshfield, and after learning to surf there, he caught the travel bug. His passion for surfing would eventually take him around the world, from Nantucket to Hawaii to Costa Rica. He found himself inexorably drawn to exotic cultures.
As a teenager Walsh spoke with an intractable and stigmatizing stutter that held him back until his senior year, when his sister Meg, then at nursing school at Boston College, found out about a speech program in Woburn. Walsh commuted two hours a day for a month of intensive therapy. For the first time, he felt he was learning something useful about the impediment, studying breathing techniques that made it easier to unclog his speech and coordinate his thoughts and enunciations. “People would say, ‘Hey, slow down.’ But it’s much more complicated than that.”
After high school, Walsh went on to BC in 1986, stringing together student loans to cover his tuition. In his freshman year, a classmate from Milton High asked if he and his friends were interested in blind dates. Well, semiblind—she showed them the girls’ pictures. Walsh zeroed in on an attractive girl of Filipino descent named Jackie Fangonil. “I’ll take that one,” he said. Their relationship began in fits and starts, and fully blossomed that spring and later that summer on Nantucket. They married in 1994. “She’s smart and fun and Asian,” he says now. “I was intrigued by her.”
Jackie was a go-getter. She set her sights on law school at BC and encouraged Walsh to do the same. “You really think I could do that?” he asked. “In case you haven’t noticed, I stutter, and lawyers do a lot of talking and presentations. Haven’t you seen the movies?”
Jackie just laughed and told him to think about it. As the notion grew on him, he decided to try to use his disability to his advantage. He got into Suffolk University Law School, writing an essay about how his struggle to surmount his stutter defined who he was.
He took on law school like it was the dawn-to-dusk landscaping summer job he had worked for several years. He did his work and drank beer on Friday nights and eventually tiptoed into the moot court classroom. After graduating in 1993, Walsh couldn’t find work with any of the Ivy-dominated firms in Boston, and took a Superior Court clerkship that exposed him to both the city’s best lawyers and the inner workings of the judicial process. He re-upped for a second year and joined Lopez for the final phase of the long-running Demoulas case. When the clerkship ended, he applied to all the major firms involved in the case but was turned down cold. Eventually Lopez helped Walsh land a job at the small Boston firm of Sullivan & Associates, housed above a cigar store squeezed between a flower shop and a Freedom Trail trolley stop on Park Plaza.
But the routine stuff Sullivan had Walsh tackling at Boston Municipal Court was a chilling glimpse of an unappealing future where practicing law devolved into squabbles over bad checks and broken contracts. He began thinking about combining his vocation with his curiosity about different cultures: a job as in-house counsel at an overseas firm that wanted to get something done and not just shuffle papers around.
During a meeting in Ed Barshak’s office on June 23, 1997, members of Arthur T.’s defense team grasped at straws. There were starkly different views of Walsh’s value: Crossen felt the New York material was an 8 out of 10, but Barshak saw it as “zero or less than zero.” Most team members preferred to seize on rumors of Lopez’s fraternizing with Robert Gerrard, counsel for the other side of the Demoulas family, at the Charles Restaurant, a Beacon Hill bistro owned by Lopez’s husband, Boston Phoenix publisher Stephen Mindich. A month later, after Lopez angrily rejected Barshak’s motion to withdraw herself from the case because of her alleged socializing, Crossen and Donahue went after the clerk again.
In late July, Reid, still in character as a headhunter, notified Walsh that the job was his, but for a final perfunctory interview. It was scheduled for Saturday, August 2, at the Four Seasons in Boston.
Walsh showed up ahead of time and calmed himself down on a bench in the nearby Public Garden. This was to be the entrée into the world of international business he’d daydreamed of for years.
When “O’Hara” ushered him into a fifth-floor suite, Walsh noticed he was more solemn this time, less affable. Something was up. He revealed himself as Peter Rush, then introduced the other man in the room as Richard Donahue, a lawyer for the Demoulas family. Then Crossen joined them, and it hit Walsh in the gut: He’d been set up.
Walsh reeled, as two of Boston’s go-to attorneys began threatening to reveal embarrassing admissions he had made during his supposed job interviews. He was at a total loss. No British Pacific? No Peter O’Hara? No job? And just what had he said during those earlier meetings? His brain whirred. Then he remembered all the inquiries about his questionable bar-application letter. Was that really such a big deal? He looked at the two baleful lawyers across from him. They seemed to think it was.
“We are here to get to the truth [about Lopez],” Crossen said.
As the confusion and humiliation set in, Walsh’s stutter kicked up. “B-b-bastards!” he yelled as he rushed out.
“It was a shattering thing. I just wasn’t thinking straight and I was struggling to keep my shit together,” Walsh says now. He stumbled up Boylston Street to the law office over the cigar store, where he found the firm’s founder, Robert Sullivan, at his desk, doing some Saturday morning paperwork. Sullivan tried to calm Walsh down. Walsh called Jackie, who rushed to the law office to find her husband pacing and wondering, What’s going to happen to my life?
By the end of Walsh’s disjointed story of betrayal, Sullivan concluded that the kid needed more than a lawyer; he needed the best lawyer Sullivan knew.
Harry Manion is the rare trial lawyer who may be as good as he says he is. A heavyset man who talks seamlessly and with boundless confidence, he was exactly what Paul Walsh needed: someone authoritative to tell him he hadn’t done anything wrong, and wasn’t going to be disbarred by sundown.
On the afternoon that Walsh’s world crumbled, Manion spoke to Sullivan and then did some quick legwork. He reached out to a Suffolk County prosecutor he trusted, who urged him toward the U.S. Attorney’s Office: “Less leaky,” the prosecutor confided. Manion got in touch with Mark Pearlstein, then first assistant U.S. attorney, who saw the situation as a job for the FBI.
A few hours later, Walsh was sitting across from Manion in a poolside cabana at Manion’s Framingham house. The former clerk was still agitated about his traumatic meeting, as well as the obvious surveillance on the Commonwealth Avenue Mall near his apartment—guys in Hawaiian shirts carrying clunky cell phones. Jackie was especially upset.
As dusk descended, Manion slowly talked Walsh off the ledge. Then he told him his options came down to two extremes: Do nothing, and hope it goes away. Or strike back.
“First, though, are there skeletons in the closet to worry about here?” Manion asked. “Any bad surprises down the road for both of us?” He was okay with the minor things from the sham interviews—the bar letter and smart remarks about lazy judges—but, he said, “I need to know: You got a broad stashed? Doing coke in clubs? I gotta know because they are going to use it against you. They’re ruthless and enormously well-financed.”
“You’re looking at what you’ve got,” Walsh replied. “There’s nothing. Some high school beer-drinking. That’s it.” Finally, he added, “I can handle anything they’ve got.”
Manion studied Walsh for a moment. “No turning back,” he warned. “Once the toothpaste is out of the tube, no fuhgeddaboudits. It’s become a very serious assault on a sitting judge.”
They hooked up with the FBI that Monday and provided an account of what had happened. After taking it all in, the agents asked Walsh to think about wearing a body wire.
Two weeks later, Walsh was wired up and ready to see where Gary Crossen would take them all. The strategy was to get him talking about the consequences of Walsh’s not cooperating and to produce hard proof that the New York meeting had indeed been taped, which could be viewed as evidence of a conspiracy.
After some phone tag, Crossen agreed to meet with Walsh at Foley Hoag’s offices in One Post Office Square. A little after 8 a.m. on August 20, the square’s park resembled a scene ripped from John LeCarre: A man in a plain dark polo watched the building’s entrance from a bench across the street; FBI agents watched him.
Once inside, Walsh sat down opposite Crossen in a windowless conference room with deep rugs and a long mahogany table. This was a big-league law firm, the kind that rejected Walsh over and over. No cigar stores in sight.
“I think what you guys did to me is despicable,” Walsh began. “I just couldn’t imagine doing something like that to another attorney. If in fact you do have tapes…then I probably am ruined. And I wanna hear what’s on the tapes before I can make any kind of decision.”
Crossen, sensing danger in Walsh’s focus on the secret taping, became evasive. “At some point in time you oughta hear the tapes,” he agreed. “Today is not that point in time.” Pressed again by Walsh, he snapped back, “Okay, that is just not going to happen, okay?”
“It just doesn’t seem right, it just doesn’t seem fair to me,” Walsh said.
Crossen softened briefly and then inched forward. “Well, you may not like the way we approached this,” he said, “but…that’s life in the fast lane, Paul….What I want is a candid conversation with you about, ahem, the predisposition issue…that she decided the case in advance. That’s what I want.”
Crossen was edging closer and closer to an incriminating quid pro quo: You give us what we want, and we go away. Then, with Walsh’s hidden recorder rolling, Crossen hung himself by tying his objective to a threat: “If there is a way for Paul Walsh to deal with this, that’s, that’s, ahem…not harmful to your career, it probably is for you to have the candid conversation with me…an acknowledgement that the judge was way out in front on a determination of the facts here, that she predetermined it.” (Crossen and Donahue maintain they never threatened Walsh.)
Walsh wasn’t about to concede anything until he heard the tapes from the sham British Pacific interviews. The meeting broke up with neither side yielding. But the next day, Crossen agreed to play a short segment of the New York interview and summoned Walsh back to Foley Hoag. Once again Walsh wore a wire into a conference room, where he was surrounded by a menacing circle of Demoulas lawyers and detectives. Unsurprisingly, the three-minute snippet Crossen played focused on Walsh’s Achilles’ heel—his admission that his bar-application letter had come from a lawyer he didn’t know. Walsh listened to “Peter O’Hara” ask him about the letter: “And actually you didn’t know him, but he knew a friend of yours? You don’t see that as a problem, do you?”
At the time of the recording, Walsh had not. It had been just another job interview question that went nowhere and meant nothing. But now, inside Foley Hoag, surrounded by well-heeled adversaries, Walsh did indeed see it as an issue. “So, you aren’t bluffing,” he said.
“No. We aren’t bluffing,” Crossen replied. “The train is ready to pull out of the station, okay?” he warned. “Um, I’m gonna respectfully suggest to you, okay, that you try to block out Monday and come visit us.”
In truth, the road was a dead end, and the lawyers had to know it. Most of the Demoulas defense team had already decided the Nova Scotia information was unreliable at best, and the New York meeting, useless. But Crossen and Donahue were desperate enough to bluff with a pair of deuces, in the hopes it would get them back in the courts. At that point, who knew where it could go?
A few days later, Walsh left a message for Crossen that he was going out of town and would call when he returned.On August 29, the FBI served grand jury subpoenas on Ernest Reid and Peter Rush, a.k.a. Peter O’Hara. Crossen, the former assistant U.S. attorney, must have deduced instinctively that his former legmen at the FBI had been monitoring him. He’d been beaten at his own game.
As the story seeped out of Suffolk County Courthouse and into the Globe, Manion took center stage—right where he liked to be. He held a packed press conference in his office—“a complete zoo,’’ he happily recalls—where he and Walsh explained their side of the story, and how the FBI and U.S. Attorney’s Office were investigating the case. Mike Wallace of 60 Minutes called, Manion remembers, and said, “We’re gonna lead with you, Harry. It’s a great story. All you need to do is give it to us exclusively.”
Manion reluctantly held his fire, persuaded by the FBI’s desire to keep things under wraps until the investigation was over, and by Walsh’s not wanting to be seen as a publicity hound. Then, slowly, the white-hot story fizzled. By October 1997, Walsh and Manion’s high hopes were dashed when U.S. Attorney Donald Stern recused himself because Crossen had once held a high post in the office. From there, the case was punted to the Department of Justice (DOJ) in Washington, where an internal scuffle broke out. Two DOJ committees and then–FBI Director Louis Freeh reportedly pushed for prosecution. But Crossen’s allies also flexed their muscle. Department records list correspondence from colleagues such as former U.S. Attorney Wayne Budd and former Suffolk County DA Ralph Martin. Another sponsor was former Governor Weld, who once called Crossen “the greatest and the straightest.” (The department recently refused a long-standing Freedom of Information Act request to release the leniency letters, on the basis they were part of personnel and medical files whose disclosure would “clearly” constitute unwarranted invasions of privacy.)
Four years after the gripping Foley Hoag meetings, in the final hours of Janet Reno’s term as attorney general in 2001, the lawyers escaped indictments. Despite the tape-recorded evidence, the cases were dropped.
It looked like another clean sweep for lawyers with the right connections and deep pockets. Crossen had resigned his position on the judicial nominating commission, but everything Walsh had gone through ultimately seemed like a waste.
Nearly a year later, when a formal ethics complaint against Curry, Crossen, and Donahue was filed with the Board of Bar Overseers, Walsh remained wary. Boston’s legal community has a reputation for favoring big firms over the little guy, and the pedigreed defendants insisted their actions were nothing more than the zealous defense every client deserves.
The board’s counsel, however, saw the case as a clear-cut example of misrepresentation and deception and came down hard on the Demoulas lawyers. Last year, after 25 days of testimony spread over nearly two years, the BBO hearing officer said Crossen and Donahue’s actions bordered on “outright extortion.” She noted that because of their accomplished careers, they “should have known better than to involve themselves in Curry’s seamy ruse.” Donahue did himself no favors with tone-deaf wisecracks during his testimony, joking about how they put the bad news to Walsh “as cold as a stepmother’s kiss right on his cheek.” In the end, the hearing officer determined the most powerful aggravating factor was the trio’s total disregard for how their actions would affect Walsh. She called for disbarment for all three. This October, the full board affirmed the recommended punishments for Crossen and Curry, but cut the ailing 79-year-old Donahue slack for playing a more passive role, calling for a three-year suspension. Crossen and Curry are expected to appeal to an unsympathetic Supreme Judicial Court; the board’s counsel, meanwhile, is considering appealing the leniency of Donahue’s penalty.
“Shit, they were going to run me over,” Walsh says now. “I decided early on I wasn’t going to let them.”
Walsh can still recall the excitement after Nova Scotia, the humiliation in Boston, the tense thrill of wearing a wire. His mind goes back easily to the sweet moment when he felt the ground shift beneath Crossen, leaving the seasoned prosecutor as clueless as Walsh had been when he went into the Four Seasons in Boston in his new blue Brooks Brothers suit. But the moment that sears still is the ride home with his parents just before all hell was about to break loose at Manion’s press conference. Walsh showed his mother the affidavit outlining the entire affair. “Read this while you’re sitting down,” he told her. He could see she didn’t understand it at first. But when she finished, she looked at him wanly and began to cry.
Walsh soon found solace in the birth of his three sons and a delicious twist of fate. A year after his dream job seemed to have vanished forever, he landed a position with a Needham-based high-tech firm with far-flung offices. By 2000, he was in Hong Kong—overseas, exactly where the imposters from British Pacific had said he would be.