Judge grants Leatherwood break in bond

“We may as well say it, the school district lost money”

Without actually entering a formal plea at an arraignment held in Gunnison District Court Tuesday, January 7, the defense attorney for Cannon Leatherwood appeared to indicate that his client would be willing to pay restitution to the school district for money he was accused of stealing. Leatherwood, the former Gunnison RE1J Watershed School District information technology director is facing eight felony counts of theft related to the alleged embezzlement of more than $411,000 from the district.

 

 

Well-known Denver defense attorney Forrest Lewis, who is representing Leatherwood, offered two motions for District Judge Steven Patrick to consider related to a supplemental discovery and Leatherwood’s $100,000 cash-only bond.
In asking for the supplemental discovery, Lewis told Judge Patrick that the information that could come to light through the discovery is “really important” to his client’s defense. If Leatherwood is found guilty on the seven Class 3 felony counts and one Class 4 felony, he could face more than 90 years in prison.
Assistant District Attorney Jessica Waggoner told Judge Patrick she had serious concerns about the prosecution’s, or the school district’s, ability to comply with the motion for supplemental discovery, which requests financial records from the breadth of the six years during which Leatherwood was allegedly directing school district funds to phony companies for equipment that was never supplied.
“We’re not a civil litigation firm that would do that kind of investigation,” Waggoner said. “The discovery would require hours and hours of the school district’s time. It’s not just something the district could just pull up.”
She also told Judge Patrick the district had agreed not to alter or destroy any of the records presently available, but couldn’t guarantee all of the records being requested would be available or accurate, since Leatherwood was in charge of keeping some of those records.
Judge Patrick asked for Waggoner to respond to the motion in writing by February 17 and asked the defense to provide a response the following week. A ruling on the motion will follow.
Most of the arraignment, however, was spent discussing the merits of the defense’s request for a reduction in the $100,000 cash-only bond, which Lewis referred to as “unreasonable under the circumstances.”
He pointed to cases in which defendants were charged with violent crimes and were held on much smaller assurity bonds, as opposed to the more restrictive cash-only bonds.
“It’s so far outside the box we feel that the court has to take some action,” Lewis said.
But Waggoner argued that the school district was concerned about a flight risk after Leatherwood began liquidating his assets shortly after he was released by the school district. She also claimed Leatherwood had failed to appear in a Denver court in August 2013 and explained that there are confirmed violations of trust in Leatherwood’s past.
On one occasion after Leatherwood was arrested for driving under the influence in Denver, he forged the school district’s half of a work-release agreement with the Denver Sheriff’s Office. “When I took over as superintendent I didn’t even know we had a work release,” Superintendent Doug Tredway said after the arraignment.
Waggoner also pointed to the missing money and suggested Leatherwood could use it to flee with once he is released on a reduced bond.
“Any thought that my client has a mattress full of money should be far from anybody’s mind. He’s sitting here in chains and a red suit,” Lewis said. “Where does that kind of money go? I don’t know. But if he had the kind of money being suggested and he wanted to flee, he would have posted that cash bond and been gone. He doesn’t have that kind of money.”
Lewis argued that Leatherwood has a wife and two young children who he wouldn’t leave and even had an interest in paying back the money stolen from the school district. Lewis asked the court to reduce the bond to $50,000 cash-only or an assurity bond that would allow Leatherwood to participate more actively in his own defense and possibly look for gainful employment on the Front Range, where his prospects of employment would be better, to continue supporting his family.
“This is a kind of case where it’s important for him to be out on bond to assist in his defense,” Lewis said. “There are some complex accounting issues here … that frankly I need his help with and I need him out on bond to do that. I also think this is a case in which the court is entitled to, and the court would want to have, as clear a picture as possible available to them at sentencing and what some sentencing alternatives might be.
“That can only happen if he bonds out and explores other opportunities to try to find real opportunities to make the district whole,” Lewis continued. “It’s a long way to go to make the district whole, considering the allegations in this case. I don’t know if those will be the final numbers or not. I don’t think so. But [Leatherwood] wants to present a picture of what he might be able to do in terms of trying to make some restitution back to the district.”
In making his case for the reduced bond, Lewis suggested the fee that would normally go to a bondsman would be held by the court and then turned over to the school district directly if Leatherwood failed to appear in court, as a down payment on restitution.
In an apparent admission that his client had stolen money from the district, Lewis said, “We may as well say it, the school district lost money and we’d like to pay that back to the taxpayers as quickly as possible.”
Waggoner argued that it was impossible to put a value on the crime Leatherwood is charged with. “At this point in the allegations, it’s $411,147.50, not to a company, not to a corporation, not to just anybody, but to the school children of this community. To the people that are going to be the future of this community. It’s impossible to put a value on the harm that he has caused.”
She also recoiled against the idea “that this is a victimless crime, a statement that can’t even be responded to,” and went on to say, “This is a lot of money that has not been found and it is somewhere. [Leatherwood] does have access to it or did at some point. There are a number of family members implicated in discovery who have been involved in this, so the family support is obviously a concern.”
Lewis responded, “I never said this was a victimless crime. You never heard that from me. What I said was that we’ve got to get some money back to the district and that’s what we’re working on. That includes paying the cash bond to the court. That includes liquidating some of [Leatherwood’s] assets. That includes getting a job so he can start a payment schedule back to the court. That’s what he intends to do. So we never said it was a victimless crime. We feel it’s very important for some of that money to go back to the taxpayers as quickly as possible.”
Judge Patrick stopped short of applying the bond schedule as Waggoner had suggested and ultimately reduced the bond to $50,000 cash or assurity, but required Leatherwood to submit to drug and alcohol testing and report to the court at 8 a.m. every day, barring any departure from the county under the current circumstances.  
Leatherwood will return to court February 12 to enter a plea, which means the criminal trial could start around August 12.

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