Friday, December 17, 1999

Peters theft charge
dismissed by judge

By Rick Daysog


A state judge today tossed out a theft charge against former Bishop Estate trustee Henry Peters.

But Circuit Judge Michael Town left open the possibility that the state attorney general's office could seek new criminal indictments against the 58-year-old former state House speaker.

Town also threw out perjury and accomplice-to-theft charges against Peter's co-defendant, local developer Jeffrey Stone. The judge did not dismiss a commercial bribery charge against Stone.

Peters, who resigned from the trust on Monday, said he was pleased by the decision. He said he hopes the state will not seek to re-indict him now that the criminal charges against him have been thrown out twice.

Last year, a grand jury indicted Peters for theft for his role in a controversial Bishop Estate land deal in Hawaii Kai. However, Town dismissed the charges in July due to improper testimony by Stone's former attorney Richard Frunzi, who recently pleaded guilty to federal money laundering charges.

"That's two strikes already," Peters said. "They don't need a third strike."

Town will hold a Jan. 18 hearing to decide whether the state could seek new indictments against Peters and Stone.

Town's decision to throw out the theft and accomplice-to-theft charges was based on improper testimony by the estate's former chief counsel, Nathan Aipa. According to Town, Aipa violated Peters' attorney-client privilege when he testified before the grand jury about Peters' personal investments in McKenzie Methane Inc., a controversial Texas methane gas company in which the estate held a large investment.

Peters' lawyer, Renee Yuen, had argued that Aipa's discussion of the McKenzie Methane deal tainted the grand jury process.

Lawrence Goya, senior deputy attorney general, said he will file a motion requesting Town to reconsider his ruling. Goya said the state will continue to pursue its criminal case against Peters and will file court papers requesting that Town's dismissal order be entered without prejudice, meaning that the state could re-indict Peters for the theft charge.

"Obviously, we respectfully disagree with the court," Goya said. "The court seems to be looking at issues which, at least in our minds, do not come into play."

John Edmunds, Stone's lawyer, said he plans to ask that the charges be dismissed with prejudice, a move that could end the criminal case against his client. Edmunds said he would ask permission to file an interlocutory appeal of Town's decision not to dismiss the commercial bribery charge against Stone.

Edmunds said that Town's dismissal of the perjury charge represents a "landmark due-process" decision. Edmunds had argued that state prosecutors improperly cut off the grand jury testimony of a key witness, local developer Glenn Okada, who was about to exonerate Stone.

"How ironic that they were indicting Mr. Stone for perjury, and now the judge says, 'You, the attorney general, got in the way of the truth,'" Edmunds said.

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