Desai takes the Fifth in bankruptcy case

Dr. Dipak Desai, the physician at the center of the hepatitis C outbreak, asserted his Fifth Amendment rights against self-incrimination more than a dozen times Tuesday during a sworn creditors examination in his bankruptcy case.

Trustee William Leonard Jr. cut short the examination after just 18 minutes after it became clear that Desai's lawyers would not let him testify under oath.

Afterward, Leonard said he would seek a judicial order to compel Desai to testify.

Desai, dressed in a black suit with an open collar blue shirt, answered only one question during the brief proceeding.

When attorney John Heisner, who represents Leonard, asked Desai whether he swore to tell the truth, he responded, "Yes," in a soft voice.

Desai entered the proceedings without an escort and appeared to have no trouble understanding that he was there to take the Fifth Amendment. His wife, Dr. Kusum Desai, who usually is at his side as he walks into court for his criminal proceedings, was not present.

Beyond answering that one question, Desai's criminal attorney Margaret Stanish repeatedly asserted his Fifth Amendment rights when he was asked questions, including one to state his full name.

Desai's bankruptcy lawyer John Hansen had previously sought to stop the sworn examination from moving forward, arguing that Desai would be unable to provide meaningful testimony about his finances.

Desai, 62, appeared confused and suffering from memory loss when Leonard and his lawyers first grilled him on April 3. He seemed to display a lack of understanding of the bankruptcy process and the state of his financial affairs.

But Chief U.S. Bankruptcy Judge Mike Nakagawa ordered the examination to continue on Tuesday.

Hansen warned Leonard and his lawyers in a letter last week that Desai would take the Fifth Amendment.

"Dr. Desai is particularly at risk because of your announced intention to 'test his memory' at the June 12 meeting," Hansen wrote. "That makes it clear that the intent of the trustee in continuing the meeting of creditors is to attempt to establish that Dr. Desai gave untruthful testimony and intentionally failed to cooperate at the April 3 meeting."

Last month, James Hill, another one of Leonard's lawyers, told Nakagawa that he thought Desai was feigning memory loss on April 3 to duck questions.

Hansen said it also was clear that prosecutors in the criminal case against Desai are closely following the bankruptcy proceedings looking for incriminating statements from the physician.

"Accordingly, it is self-evident that Dr. Desai is at risk of prosecution and self-incrimination if he testifies at the June 12 meeting," Hansen wrote.

In January, state medical experts found Desai competent to stand trial on criminal charges in the 2007 hepatitis C outbreak. The experts concluded that Desai had exaggerated cognitive impairments from two strokes.

Desai and nurse anesthetists Keith Mathahs, 75, and Ronald Lakeman, 64, each face 28 felony charges, including racketeering, insurance fraud and neglect of patients. They are to stand trial on Oct. 22.

The charges revolve around seven people who authorities say were infected with the potentially deadly hepatitis C virus at Desai's clinics.

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135.