Rigas Attorneys Chip Away at Analyst

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New York -- Defense attorneys for four former Adelphia Communications Corp. executives grilled a Morgan Stanley Dean Witter & Co. cable analyst Monday, trying to establish that the more than $2 billion the Rigas family borrowed (which Adelphia was liable for) had little impact on the investment community’s perception of the MSO.

Former Adelphia chairman John Rigas, his sons -- former chief financial officer Timothy Rigas and former executive vice president of operations Michael Rigas -- and former director of internal reporting Michael Mulcahey are on trial for 24 counts of conspiracy, wire fraud, bank fraud and securities fraud. All four men have pleaded not guilty.

On Monday, John Rigas’ lawyer, Peter Fleming, focused on two reports Morgan Stanley analyst Rich Bilotti issued in 2002.

In the first, issued in February 2002, Bilotti estimated that basic-cable, high-speed-Internet, telephony and digital-cable revenue for Adelphia would be $3.1 billion in 2001, growing to $5.6 billion in 2006.

In the second report, issued March 28, 2002 (the day after Adelphia revealed in a conference call with analysts that it may be liable for $2 billion the Rigas family had borrowed), Bilotti estimated that revenue at the MSO would be $3.1 billion in 2001 and $5.4 billion in 2006.

However, defense attorneys didn’t ask Bilotti what effect the disclosure had on his estimates for other financial metrics, such as cash flow.

Court was adjourned at 1 p.m. Monday in observance of the Passover holiday.

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