Blagojevich's Defense Fund Is Empty: Who Will Pay for His Trial?

The fund former Illinois governor Rod Blagojevich has been using to pay his defense lawyers is officially gone. After his arrest on Dec. 9, 2008, the fund, originally established to support his campaign efforts, had approximately $2.6 million. He then began using the money to pay his legal fees. Now it is empty. Two final payments, totaling $75,693.94, were issued Friday morning, Aug. 13, according to Public Access to Court Electronic Records. "There's nothing left. Everything was paid this morning," says Michael Dobbins, clerk of the U.S. District Court for the Northern District of Illinois.

The former governor's campaign fund, called the Friends of Blagojevich (FOB) fund, has been a focal point of his trial. Federal prosecutors allege that much of the attempted extortion, bribery, racketeering, wire fraud and other charges surrounding Rod Blagojevich and his brother Robert were contemplated for the purpose of growing the FOB fund. Defense attorneys for both brothers have hotly disputed that contention.

What does that mean for the Blagojevich defense? The former governor could go to Judge James Zagel, who is presiding over the case, and ask for public assistance through the Criminal Justice Act's (CJA) Federal Defender Program, which can provide court-appointed attorneys "any time prior to sentencing," according to the CJA attorney plan for the U.S. District Court for the Northern District of Illinois.

However, as of Friday, lead defense attorney Sam Adam Jr. said he had no plans to resign from the case. "Of course we will [still be his lawyers]," Adam said via a text message. "If [Judge James] Zagel stopped payment we would still be his lawyers! That is insulting. If you are in a case, you do your best throughout the case for as long as the trial lasts. Money is not the goal, providing the best representation is." He later added, "I have never backed out of any case because of money or lack of money, once I'm in."

Rod Blagojevich's defense team is already being paid at public-defender rates, with several senior attorneys like Adam and his father Sam Adam receiving $110 an hour, while some of the other attorneys on the defense team are being paid at $50 to $75 an hour, according to defense attorney Sheldon Sorosky. "The money was not what we were focused on," Adam Jr. said. "Come on. I've got a jury out that for the first time in Illinois a governor may be found not guilty of public corruption. I'm not thinking about the money we were paid and who got what."

Lawyers have an ethical obligation to continue when a jury is deliberating since to do otherwise would "severely prejudice the jury against a client," says Lance Northcutt, adjunct professor and assistant director for advocacy at the John Marshall Law School. "It's very common in these situations, where an attorney is so invested in the case, they will make reasonable accommodations rather than bolt as soon as the money runs out," Northcutt says. "The reality, at this stage, is Judge Zagel isn't going to let them withdraw while the jury is still out. I don't think there is a chance that would happen anyway." Still, Sam Adam Jr. and the rest of the defense's legal team may have to consider remuneration sooner rather than later. "I think it will be a bigger issue if it's a hung jury and the government says we will retry the case," Dobbins says, referring to his week's notes from the jury indicating their difficulty reaching unanimity on most of the charges. "At some point he's [Rod Blagojevich] going to have to look at how's he's going to have to cover this."

Indeed, if the jury returns with a decision on just two counts and remains hung on the remaining, the government, led by U.S. Attorney Patrick Fitzgerald, could choose to bifurcate the case and retry Rod and his brother on the counts the jury couldn't decide. If that happens, taxpayers could end up paying for both the government's case and the defense team, if the Blagojevich brothers seek and receive public defenders.

Why were the Blagojevich brothers able to tap into the FOB funds for their defense in the first place? After the siblings were indicted in April 2009, the fund was transferred to the U.S. District Court. Originally, federal prosecutors sought to secure the campaign fund, arguing that it was "established on behalf of Rod Blagojevich to support his campaign efforts so that he could maintain and influence a racketeering enterprise designed to personally enrich Rod Blagojevich and his family, and, as part of the enterprise, his interest in the FOB funds." But Zagel sided with the legal defense team and allowed the defense attorneys to be paid out of the campaign fund. "It has been one of our few victories in court," said Sorosky last week.

Robert Blagojevich served as the FOB fundraising chairman for several months, beginning in August 2008. Before his indictment in April 2009, the government had released $50,000 from the Blagojevich campaign fund for Robert's defense team. But going the public-defender route is something Robert is unlikely to do. "I've been paying my own legal bills," he told TIME on Friday. "And it's a lot. I won't say how much, but I took out a second mortgage on my home [purchased for $867,997 in 2002 in Nashville], liquidated my IRA and my wife's IRA to try and pay for this." His defense attorneys filed a motion to have Robert Blagojevich's current legal tab, totaling more than $350,000, paid by the Blagojevich campaign fund in June, but they have not received any of the requested amount.

If the former governor turns out to need a public defender, he would, as would his brother, have to submit a financial affidavit listing all of his assets. The court would then determine whether he could afford his own attorney and decide if there is enough equity in his home and whether his property could be taken, Dobbins says. Rod Blagojevich's 3,800-sq.-ft. (350 sq m) home on the north side of Chicago was assessed at $700,980 in 2009, up from $424,331 in 2008, according to the Cook County assessor. The home is listed in the name of his wife Patti. It too is controversial. Prosecutors say the property had thousands of dollars of work done for free by Rezmar, a development company run by Tony Rezko, a political fundraiser now serving time on several counts of fraud and bribery.

The couple also have a two-bedroom condo in Washington under Rod's name. It was assessed by the District of Columbia at $479,480 in 2010. But there's a complication: if the jury finds Rod Blagojevich guilty on two or more of the 24 counts of racketeering or the conspiracy to commit racketeering, the government can try to recoup "ill-gotten gains" made during the alleged criminal activity and put it back into public coffers. With such a forfeiture, Rod Blagojevich might not be able to use his homes as collateral at all.