June 9, 1999
Portland, Maine

Capping an ordeal which has taken her from operating the wave-slapped Old Orchard Beach Pier and its pungent smell of cotton candy and salt water taffy to a federal prison after her conviction on multiple counts of fraud and conspiracy, Catherine Duffy Petit was sentenced to 15 years and eight months in a federal penitentiary Tuesday.

U.S. District Court Chief Judge D. Brock Hornby told Petit that she committed a "grievous crime" before sentencing her to the lowest term he could have under federal sentencing guidelines. Assistant U.S. Attorney Donald Clark had asked that Petit be sentenced to the maximum of 19 years and 10 months.

"What you done or allowed to have done was grievously wrong and injured scores of innocent people," Hornby told Petit. "No denials, excuses or explanations can change that. The jury verdict overwhelmingly supported the evidence that was presented in your trial."

Standing in the faded orange jumpsuit provided by the Cumberland County Jail, Petit broke down at times during the nearly five-hour sentencing process, particularly when she addressed the court for the first time in her criminal ordeal. She asked for an immediate appeal to be filed on her behalf.

She apologized to victims of the fund-raising, her family and friends, singling out co-defendant Paul Richard and his family. Richard was sentenced to 14 years Wednesday.

"Paul Richard never took any action to deceive or get money from anyone. He does not deserve nor does his actions warrant a long incarceration," Petit told Judge Hornby.

Telling Judge Hornby that she did accept some responsibility for events that spiraled out of control in her effort to fund litigation costs for her 14-year lawsuit against Key Bank, Petit also was adamant in her assertion that the bank had tied her in legal knots since she filed the suit in 1986 and backed her against a wall.

"The Key Bank case is no longer just about the Old Orchard Beach Pier and me being wronged," she said. "It has become a vehicle of deceit in which a lot of decent people have been harmed."

Petit was particularly scathing in her assessment of the government’s reliance on the testimony of Thomas Blackburn and James Erskine and their use of Donald Shields as an informant. All three- along with Robert Paradis, Greg O’Halloran and Armand Pelletier – pleaded guilty to felony charges in exchange for sentencing leniency.

"I pray that those that are hiding under the skirts of the government don’t fool the court," she said.

In addition to her prison time, Petit was ordered to forfeit nearly $164,000 and any assets tied to the offenses and to make restitution of nearly $8 million to investors who were not repaid.

A packed courthouse listened on as Judge Hornby imposed the sentence. As befitted a Petit-related legal gathering, a number of Maine lawyers with various interests were on hand to watch the proceedings.

As they are at every Petit-related legal matter, attorneys for Key Bank were also in attendance. The bank made a $1.75 million offer to settle the case with the trustee of Petit’s bankruptcy estate last week.

Petit filed a motion last month saying that Assistant U.S. Attorney Donald Clark, the lead prosecutor in her criminal conviction, intervened in her bankruptcy case.

Despite Clark's assertion that he wants victims of Petit’s fund-raising to be reimbursed, Clark called the attorney of a creditor in Petit's bankruptcy in April and told him that he should accept Key Bank’s settlement offer, Petit alleged. Many of the government’s named victims are creditors in the bankruptcy case.

Petit also alleged that Clark committed a number of prosecutorial misconduct offenses. Judge Hornby dismissed the motion because Petit had filed it pro se while she was still represented by counsel.

Many creditors have balked at the settlement offer, saying that it would only pay attorney’s fees and allow Key bank to buy its own lawsuit for pennies on the dollar. Should a jury return a verdict for the plaintiff, the suit has been valued as high as $66 million before punitive damages and 94 percent interest is tacked on.

Also in attendance were a number of Key Bank lawsuit investors who were listed in the government’s criminal complaint as victims. Many wrote letters of support for Petit to the judge and some were prepared to speak. However, only in a violent crime are victims allowed to speak.

Petit attorney David Beneman asked Judge Hornby to make a recommendation that she be sentenced to the federal penitentiary in Danbury, Connecticut. The judge agreed, and also ordered that she spend three years on supervised release following her term.

Judge Hornby also urged those who believe that Petit is the victim of a conspiracy to prevent her Key Bank case from going to trial – as the Maine Supreme Judicial Court said it should in 1996 – should not blame her conviction and sentence on anyone but Petit.

"Some will say that another injustice has been done to Catherine Petit," he said "but they are wrong. If they do, they did not listen to the evidence and the jury’s decision."

Judge Hornby also acknowledged that Petit is probably the victim of an injustice, saying, "based on your past litigation, it seems that you were wronged."

However, he added, it did not justify her actions, despite the seeming obsession she had with her Key Bank case, Judge Hornby added.