What to Expect From the Second College Basketball Corruption Trial

Michael McCann
What to Expect From the Second College Basketball Corruption Trial

Last October, a federal jury in Manhattan sent shockwaves through the closely-tied worlds of college basketball and sneaker companies. It convicted Adidas director of global marketing James Gatto, Adidas consultant and basketball organizer Merl Code and client recruiter Christian Dawkins of wire fraud and conspiracy. The verdict established that payments designed to lure elite high school basketball into attending Adidas-sponsored college basketball programs are not only blatant violations of employment contracts, university honor codes and NCAA rules, but they are also crimes.

Felonies, in fact.

In March, U.S. District Judge Lewis Kaplan sentenced Gatto, Dawkins and Code to prison sentences lasting either nine months (Gatto) or six months (Dawkins and Code). The sentences will not begin unless and until the defendants’ appeals play out without success. Still, for a basketball executive to be sentenced to prison for arranging for a “bribe” to a high school player is a startling development in American sports. Such payments had occurred for decades without criminal ramifications, but that has now changed—much to the approval of the NCAA. Armed with the convictions of Gatto, Dawkins and Code, the NCAA knows that certain types of recruiting infractions have become grounds for criminal charges. This means that NCAA amateurism rules have become much more threatening and thus more deterring of wrongful conduct.

On Monday, prosecutors from the U.S. Attorneys’ Office for the Southern District of New York will begin their second college basketball corruption trial in Manhattan’s Thurgood Marshall Courthouse. Structurally, the case is similar to the first one. It involves allegations of fraud, conspiracy and bribery in college basketball and the two defendants—Dawkins and Code—are holdovers from the first trial. This time around, however, the focus is much more on bribes to coaches than on bribes to players and their families.

Another key difference is the identities of the schools that are implicated by allegations. In the first trial, Louisville and Kansas were mainly at issue. This time around it’s South Carolina, Oklahoma State, Arizona, USC and two unnamed schools that are believed to be Creighton and TCU. Monday’s trial, which is expected to last three weeks, could lead to revelations that are damaging to those schools and that make them susceptible to NCAA sanctions.


Understanding the key factual claims against Code and Dawkins


The case against Dawkins and Code began in September 2017 when the two men faced multiple charges for fraud, conspiracy and bribery. The charges were contained in two criminal complaints. In the first complaint, Dawkins and Code were tied to co-defendant Gatto. The trio was accused of hatching a scheme with college coaches to bribes recruits and their family members. In the second complaint, Dawkins was initially tied to four co-defendants: Lamont Evans (initially an assistant coach at South Carolina and later at Oklahoma State), Emanuel “Book” Richardson (assistant coach at Arizona), Tony Bland (assistant coach at USC) and Munish Sood, (a registered investment advisor). Evans, Richardson and Bland have all been fired from their coaching jobs and, as explained below, have all reached plea deals with prosecutors. The FBI’s investigation into college corruption took place from 2015 to 2017, meaning wrongdoing relevant to the criminal charges occurred within that time span.

Dawkins and Code are accused of conspiring to bribe Evans, Richardson, Bland and at least two other coaches who are unnamed in the pleadings—“Coach-1” is believed to be Creighton assistant coach Preston Murphy and “Coach-2” is believed to be TCU assistant coach Corey Barker. Both Murphy and Barker have been placed on administrative leave by their schools and are linked to possible $6,000 bribes. All of the coaches are accused of accepting bribes in exchange for pursuing a particular purpose: encourage their players to hire Dawkins and Code as financial advisors when they pursued the NBA. The coaches, prosecutors stressed, “had influence over the student-athletes at their schools, including with respect to guiding those student-athletes through the process of selecting agents and other advisors when they prepared to leave college and enter the NBA.”

Dawkins, who is in his mid-20s, is viewed as the mastermind. As prosecutors tell it, the Michigan native with ties to AAU basketball aspired to become an influential figure within the basketball world but was unable to gain a foothold through his work for NBA player agent Andy Miller and Miller’s agency, ASM Sports. Dawkins went on his own, and invented a formula of sorts for quickly amassing influence. Dawkins, along with business partner Sood, realized that assistant coaches would not only accept bribes, but they would also be willing and able to direct elite players to hire Dawkins’s fledgling sports management company. That company was called LOYD (“Live Out Your Dreams”).

Code, 45, was crucial to this plan and to LOYD’s prospects. A former starting point guard at Clemson in the 90s and the son of a prominent South Carolina attorney, Code was well-positioned to influence coaches, along with players and their families. Code had the kind of access, gravitas and polish that the younger and less-experienced Dawkins lacked. As an Adidas consultant, Code interacted regularly with coaches and players at the high school and college levels. He also served in a similar position for Nike years earlier. Dawkins is accused of transmitting illicit monthly payments worth thousands of dollars from his company to Code.

To illustrate the defendants’ alleged acts of bribery, Dawkins is accused of bribing Richardson at least $20,000 in 2017. In exchange, Richardson agreed to “steer” elite basketball players at Arizona to hire Dawkins and Sood.

This was not the most sophisticated criminal enterprise ever hatched. Basically, it involved one person paying another person to influence a third person.


Understanding the alleged crimes committed by Code and Dawkins


The charges against Dawkins and Code are far-reaching. Each defendant faces six counts, including those for bribery and conspiracy to commit bribery. To that end, Dawkins and Code are accused of willfully and knowingly conspiring with others to funnel tens of thousands of dollars to coaches who work for universities that receive federal benefits. Such benefits include financial student aid, grants, subsidies, insurance and other forms of federal assistance commonly provided by the government to universities. The government subsidizing almost every college in America is one way that prosecutors attempt to identify a sufficient nexus between federal criminal law and payments involving private individuals, private companies and private universities.

During the trial, prosecutors will reference specific instances of alleged bribes. One instance will be March 3, 2016 meeting in South Carolina that involved Dawkins, Sood, Evans and an unnamed cooperating witness. In this trial, a cooperating witness will be someone who has agreed to testify against Dawkins and Code in exchange for favorable treatment by prosecutors. One cooperating witness in the college basketball corruption probe is Pittsburgh-based financial advisor Marty Blazer, who aided the FBI as part of his own plea deal. During this meeting in South Carolina, the group allegedly discussed how “Evans could direct and influence certain student-athletes that Evans coached at the University of South Carolina to retain the services of Dawkins, Sood and the cooperating witness.”

Another instance will be a July 29, 2017 meeting arranged by Code at the Cosmopolitan Hotel in Las Vegas. The meeting also involved Dawkins and Bland, and centered on how Bland could steer USC players to Dawkins in exchange for payment. SI’s Jake Fischer and Jon Wertheim have uncovered extensive details on Dawkins’s activities in Vegas that day, and the role played by an undercover FBI agent who went by the name Jeff DeAngelo. DeAngelo posed, convincingly, as a New Jersey real estate magnet that wanted to invest in Dawkins’s company. Unbeknownst to Dawkins and Code, DeAngelo was the lead investigator in the government’s investigation into the two men. As explained below, DeAngelo could become important to Dawkins’s defense.

The government’s case also includes three counts for honest services wire fraud. This type of fraud occurs when an employer is deprived of its intangible right to employees providing their “honest services.” Here, Dawkins and Code are accused of devising a scheme to deprive the colleges that employed the bribed coaches of those coaches “honest services.” In other words, Dawkins and Code are thought to be criminally responsible for luring coaches into accepting bribes in contravention of their employment contracts, university codes of conduct and NCAA rules. The victims, then, are those coaches’ employing universities.

As a point of context, honest services wire fraud has been used to prosecute Lori Loughlin, Felicity Huffman and other parents who were nabbed by the FBI in Operation Varsity Blues. The parents are accused of bribing college water polo, tennis and other sports’ coaches. In turn, the coach reserved a spot on the college team for the parents’ child and also manipulated the college’s admissions process to ensure that the bribing parent’s child was accepted. The same “honest services” concept that applies to Dawkins and Code also applies to Loughlin and Huffman; the defendant allegedly bribed the coach, and because the coach was bribed, he or she failed to furnish “honest services” to their employing college.

Honest services wire fraud also requires a finding that the defendants used interstate wire communications to advance their plot. The government contends that telephone calls, texts emails and bank wire transfers establish that Dawkins and Code engaged in the requisite interstate wire communications to bribe coaches.

Lastly, Dawkins and Code are accused of conspiring to violate the Travel Act. This law makes it a crime to willfully and knowingly travel across states, and to use the interstate postal service, to carry out an unlawful activity. Dawkins and Code flew across the country to partake in meetings where they allegedly bribed coaches.


The power of the government’s case: straightforward in design and evidence-based in application


U.S. Attorney Geoffrey Berman and other prosecutors from the Southern District of New York are no doubt confident they will prevail in this college basketball fraud trial, just like they won the first one. Part of their confidence reflects the relative simplicity of the case and the high probability that jurors will understand the facts. This is not a complicated or confusing litigation involving inaccessible theories of law, nor is there substantial doubt as to whether payments to coaches took place. Prosecutors will tell jurors the trial is fundamentally about illegal bribes that harmed universities. If jurors agree, they will probably not find “reasonable doubt” and will instead be inclined to convict Dawkins and Code.

To advance that narrative, prosecutors will rely on the testimony of cooperating witnesses. Most of the defendants charged in the college basketball corruption probe have cut plea deals with prosecutors. They have agreed to plead guilty to one count of bribery and provide useful information, including electronic evidence and bank records. The defendants with plea deals have also agreed to offer testimony that can be used against the remaining defendants and potentially also be used to charge additional persons. In return, prosecutors agree to recommend that the defendants who admit responsibility receive lighter prison sentences from the sentencing judge. Evans, Richardson, Bland and Sood have all pleaded guilty. This almost certainly means that prosecutors will directly or indirectly deploy them against Dawkins and Code. The coaches will corroborate what prosecutors say happened—the meetings, the payments, the scheduling, the goals, the wire transfers, all of it. They will thus play instrumentals roles in getting jurors to believe the government’s storyline.

Other potential witnesses could also play important functions. For example, Arizona head coach Sean Miller and LSU head coach Will Wade were recently notified that they may be compelled by subpoena to testify in the trial (as explained below, per a ruling on Friday, both men are no longer expected to testify). There are likely other head coaches and persons in college basketball that have received similar notifications. These witnesses are not accused of wrongdoing but may have partaken in conversations, emails or texts with bribed assistant coaches, Dawkins or Code. Some of those conversations may prove advantageous to the prosecution. For instance, if a bribed assistant coach tried to convince his head coach about how wisely Dawkins and Code would advise their players, that conversation would help prosecutors establish that the bribed assistant coach acted in furtherance of the bribe—and thus deprived his university of his honest services.

The playing of audio recordings will also be damning evidence. It’s clear from the government’s complaint and accompanying documents that prosecutors are in possession of recordings of phone conversations involving Dawkins and others. These recordings could reflect poorly on players and coaches who are not defendants. Although attorney Michael Avenatti is not part of the trial, he recently tweeted claims surrounding topics that might surface in the trial. For instance, Avenatti accuses Phoenix Suns center Deandre Ayton and his mother, Andrea Ayton, of taking bribes from persons connected to Nike in connection with Ayton playing at Arizona during the 2017–18 season. It’s unclear if Avenatti, who faces extortion charges for allegedly attempting to shakedown Nike, is telling the truth or has verifiable evidence to support this accusation. The trial, however, could help to corroborate or refute the accusation, especially if Richardson (the former Arizona assistant coach) was somehow connected.

Prosecutors are also advantaged by their success rate. The U.S. Attorney’s Office for the Southern District of New York is considered by many attorneys to be the preeminent office of federal prosecutors. Also, federal prosecutors secure trial convictions between 85% and 95% of the time. Having already been convicted in the first trial, Dawkins and Code are keenly aware of the talents of federal prosecutors from the Southern District of New York. Nonetheless, and barring a last-minute plea deal, they will go to trial on Monday for a second time and hope for a different outcome.


Forecasting the defense arguments and legal strategies


As implied above, Dawkins’s and Code’s lead attorneys—Mark Moore (a former federal prosecutor) and Steve Haney, respectively—face long odds. Federal prosecutors win roughly nine out of every 10 trials and prosecutors from the Southern District of New York are especially formidable. The defense attorneys also recognize that Dawkins and Code face the possibility of significant prison time if they are convicted. While Dawkins and Code would not be sentenced to anywhere near the maximum (decades of prison time), they could more realistically face in the ballpark of three to five years in prison.

Keep in mind, there is a different presiding judge this time around: U.S. District Judge Edgardo Ramos. While Judge Kaplan was relatively lenient in his sentencing of Dawkins, Code and Gatto, there’s no guarantee that Judge Ramos would adopt the same approach. He, like Judge Kaplan before him, would have vast discretion in determining sentences should Dawkins and Code be convicted.

At the same time, Dawkins and Code will face a different set of jurors than in the first trial. The jury in the first trial was clearly not an ideal one for Dawkins and Code since none of the jurors found reasonable doubt in the government’s case. Heading into the second trial, the defense attorneys will use the voir dire process, where defense attorneys and prosecutors can question prospective jurors for potential biases, in hopes of identifying more pliable jurors. The defense attorneys will pay particular attention to jurors’ views about whether bribes in the context of college basketball can constitute crimes. Expect those attorneys to learn from the first trial in terms of the backgrounds and demographics of its jurors. The attorneys will try to select a group of jurors that will be relatively skeptical of the government’s case or at least open minded to the defense’s perspective.

To that point, a key defense for Dawkins and Code will be to ridicule the idea that paying a coach to influence players constitutes a crime. While such a payment probably violates a coach’s employment contract, his or her university honor code and NCAA rules, those are mere private, civil violations and they do not carry the frightening possibility of a prison sentence. For the government to assert that such payments are also crimes is unprecedented and, as the defense attorneys will plead to jurors, indicia of vast government overreach.

Along those lines, bribing a school’s coach is not the same as bribing a public official, which is indeed a crime because of its adverse public implications. While a bribed public official could damage society at large and the public’s faith in government, a bribed coach’s harm is limited to encouraging a player to consider hiring one particular sports management firm over another.

Similarly, the attorneys might ask jurors to consider that if Code had walked up to a coach and handed him $10,000 in cash to influence players, there likely would be no finding of wire fraud. This is because there was no interstate communication in that scenario. If that scenario is not a crime, why should adding a mere wire transfer of funds that cross state lines states or a text sent between states trigger such a radically different outcome?

The defense attorneys will likely introduce evidence, including recordings, that undermine the government’s depiction of Dawkins and Code as engaged in bribery. Similarly, they will attempt to exclude damning evidence on account of it being overly prejudicial or misleading. The attorneys will also characterize Dawkins’s and Code’s conduct as law-abiding. To that point, earlier this month the defense attorneys requested permission from Judge Ramos to subpoena “two current men’s basketball coaches.” Those coaches are believed to be Miller and Wade. Both coaches were expected to testify that they knew Dawkins and that he did not bribe them. They might have also testified that corruption is commonplace in “big time” college basketball. On Friday Judge Ramos agreed with prosecutors that such testimony would be irrelevant and inadmissible “good acts” evidence under Federal Rules of Evidence 402 and 403. Generally speaking, evidence that a defendant happened to have been honest in some of his or her business dealings is not relevant as to whether the defendant engaged in the specific types of fraud alleged by prosecutors. Stated differently, even if Dawkins did not bribe Miller and Wade, that doesn’t mean he didn’t bribe the assistant coaches mentioned earlier. Likewise, Miller and Wade acknowledging that corruption is frequent in college basketball would not refute the particular accusations against Dawkins. As a result, neither Miller nor Wade will likely be called to testify in the trial

Alternatively, the defense attorneys might try to favorably recast any admissible evidence of seemingly-illicit payments. The attorneys could contend that those payments are perfectly (lawful) marketing and recruiting expenses and are commonplace in the competitive world of sports management consulting. Further, as defense attorneys tried to argue in the first trial, prosecutors can be accused of trying to criminalize NCAA violations. The attorneys will highlight well-traveled arguments against amateurism and economic unfairness to college athletes. To that point, the defense attorneys might stress that use of fraud and similar laws to prosecute persons in college basketball goes well beyond the original intentions of those laws, many of which were designed to prosecute members of the mafia who had also committed violent offenses.

The defense attorneys will also object to the contention that schools have been deprived of honest services from their coaches. The government’s proposed paradigm features the college as the victim. For example, USC was allegedly victimized by Bland taking a bribe to influence players. One concern with this paradigm is its lack of limiting principle. Coaches are influenced in their interactions with players through numerous external forces, be they sneaker companies with whom coaches have endorsement deals, networks that broadcast games, boosters and influential alumni. A “bribe” may not always appear as cash or wired payments. Sometimes it appears as a consulting opportunity. Other times it comes in the form of heightened access and enlarged prominence. Inducements of the less obvious kind can be just as effectual.

There are still other possible defenses. Dawkins’s attorneys have requested consent from Judge Morales that they can argue entrapment. As detailed by Fischer and Wertheim, Dawkins and his company, LOYD, struggled until the not-so-fortuitous involvement of Blazer (the cooperating witness) led to substantial facilitation by DeAngelo (the undercover FBI agent who posed a rich investor seeking to invest in Dawkins’s ventures). DeAngelo wined and dined Dawkins, and supplied with him needed funding. He also introduced Dawkins to another undercover agent who was posing as a wealthy investor that similarly feigned enthusiasm in Dawkins’s plans. While this fake courtship progressed, numerous hours of Dawkins’s phone conversations were recorded. Dawkins’s attorneys have learned that DeAngelo is accused of wrongfully spending government money on gambling while posing undercover.

Dawkins’s attorneys would like to be able to argue that the case against him was constructed through deceit and orchestrated by an undercover agent who himself was engaged in wrongdoing. Entrapment, however, would be difficult to establish. Even if DeAngelo encouraged Dawkins to bribe coaches, Dawkins was (allegedly) already predisposed to doing so. Normally entrapment requires a finding that law enforcement’s conduct would have induced a typical, reasonable person to commit a crime that they would not have otherwise committed. The prosecution would argue that Dawkins was far along in plans to bribe coaches before DeAngelo appeared on the scene. Prosecutors also signal that, should Dawkins attempt an entrapment defense, they intend to introduce evidence that led to Dawkins being convicted in the first trial (the Federal Rules of Evidence generally restrict prosecutors from introducing evidence of a defendant’s past crimes, but that is possible in limited situations, including when relevant to evaluate a defendant’s predisposition to commit a crime).


The trial’s aftermath and the NCAA


If Dawkins and Code are convicted of the charges, they will appeal their convictions, just like they appealed the convictions from their first trial. Should Judge Ramos adopt a similar mindset to Judge Kaplan, Judge Ramos would not order Dawkins and Code to prison until their appeals have been heard.

Similar to how the convictions from the first trial likely scared off people who had planned to bribe high school basketball stars, a conviction in the second trial would probably scare off people from attempting to bribe coaches for influence with players. From that lens, the big winner should Dawkins and Code be convicted would be the NCAA and its system of amateurism.

However, if Dawkins and Code are found not guilty (or if there is a hung jury, meaning jurors are split on whether to convict or find not guilty, and it will be up to prosecutors to decide to retry the case), the government’s case would suffer a significant setback. It could signal that jurors believe the government has overreached and that NCAA amateurism rules should not be used to advance criminal prosecutions. Then again, prosecutors would assert that a loss in the second trial should not take away from the win in the first trial nor should it take away from prosecutors securing plea deals with most of the defendants, who agreed to acknowledge that they broke the law.

Meanwhile, the third trial for the college basketball corruption probe is scheduled to take place in June. Clothing executive Rashan Michel will stand trial accused of plotting with fired Auburn University associate head coach Chuck Person to direct college players to use Michel's clothing service. U.S. District Judge Loretta Preska will preside over Michel’s trial in Manhattan. Last month Person and his legal team negotiated a plea deal where he agreed to plead guilty to conspiracy in exchange for the other charges being dropped and a reduced sentence recommendation by prosecutors. Person will be sentenced in July and is expected to face up to two and a half years. It’s possible, of course, that Michel could reach a plea deal before the June trial—and he may be more inclined to do so if the government prevails in the second trial.

Turning to potential NCAA infractions, the NCAA has not yet punished schools that are implicated in the college basketball corruption probe. That makes sense since if the NCAA punished schools while the investigation and prosecutions were occurring, certain witnesses who have been helpful to the government may become less helpful. They could worry about the prospect of the NCAA punishing them or their schools. That said, expect the NCAA to review potential punishments of schools once the trials are over. The NCAA can—and almost certainly will—rely on information gathered through the trials.

Michael McCann is SI’s legal analyst. He is also Associate Dean of the University of New Hampshire School of Law and editor and co-author of The Oxford Handbook of American Sports Law and Court Justice: The Inside Story of My Battle Against the NCAA.