August 1, 1994 - Part 2
August 1, 1994 - Part 2
(13:15:31) Mr. KATsANos. I have no idea. I would have to concur with my colleagues here, and I'd have to reflect that when I was a reporter, I would have loved to 'have bad the job of covering the RTC. It is, because of the staff here, because of the people within the RTC, one of the easiest a emergencies to cover. One reporter once referred to it as not a very challenging agency. It's like shooting dead fish floating in a barrel of water. It's an exceptionally easy agency to cover. Senator MURRAY. Because you can get information quite easily? Mr. KATSANOS. You can get information from RTC staff and from RTC contractors. You can get information from congressional staff, and that's not unique to the RTC. It's just that since it is such a visible organization with such a controversial job with so many different players involved, it's a simple job as far as a reporter is concerned. Senator MURRAY. I will go back one more time, Mr. Ryan. You did say that leaks can really be a problem in terms of fraud and abuse. Mr. RYAN. Yes, they can. Senator MURRAY. Thank you. The CHAIRMAN. We're going to excuse Mr. Ryan just for a moment. Senator Hatch. OPENING COMMENTS OF SENATOR ORRIN G. HATCH Senator HATCH. Thank you, Mr. Chairman. Ms. Kulka, prior to your employment at the RTC you worked for the Office of Thrift Supervision. Is that right? Ms. KuLKA. That's correct. Senator HATCH, While you were at OTS you were involved in the Kaye, Scholer settlement. Right? Ms. KuLKA. That's correct. Senator HATCH, Working on the Kaye, Scholer settlement at OTS, you bad dealings with Bernie Nussbaum and his law firm because they were representing Kaye, Scholer. Is that correct? Ms. KuLKA. I never met Mr. Nussbaum in that context. I had dealings with other of his partners, that's correct. Senator HATCH. But you did work with his law firm. Given your negotiations with Kaye, Scholer in that case, is it your opinion that 51 Mr. Nussbaum may have developed a view that you were tough or aggressive? Ms. KULKA. I try to review back how I handled the negotiations on the financial aspects of that settlement, sir, on the note that represented the payments Senator HATCH. I . had not criticizing you. Ms. KuLKA. -and I behaved in that case as I do in any other, I really don't know what someone would characterize. Senator HATCH. In your deposition, when you were basically asked that question, you said I hope so because that's your job. Right? Ms. KULKA. Yes, sir. Senator HATCH. You said you were "pretty tough" in negotiations. I commend you for it. I don't have any problem with that. I think you also characterize yourself as assertive. Ms. KULKA. Yes, sir. Senator HATCH. When you were hired as General Counsel of the RTC, that was in January 1994, 1 believe. Is that right? Ms, KuLKA. That's correct. Senator HATCH. When you were hired by the RTC, you were interviewed by the Treasury people as well. Is that right? Ms. KULKA. That's correct. Senator HATCH. Mr. Nussbaum never interviewed you? Ms. KuLKA. No. Senator HATCH. As General Counsel you were in charge of all the legal work at the RTC overseeing what, about 500 attorneys or lawyers? Ms. KuLKA. Yes, I think that's correct, sir. Senator HATCH. You mentioned there came a time in January 1994, when the RTC needed to hire an outside counsel to assist in the investigation of Madison. Right? Ms. KuLKA. That's correct. Senator HATCH. The RTC, based on the recommendations of the Senior Counsel and Assistant General Counsel, decided to hire the firm of Pillsbury, Madison, and Sutro. Ms. KULKA. Yes, sir. Senator HATCH. Is it not true that you were informed that Jay Ste Stephens was one of the two partners from Pillsbury, Madison who might head up the investigation? Ms. KuLKA. That's correct. Senator HATCH, You were made aware that jay Stephens was a former U.S. Attorney in the District here. Ms. KULKA. That's correct. Senator HATCH. You discussed the necessary requirements and decided that a former U.S. Attorney should be hired, Ms. KuLKA. There were aspects of the case that made that helpful Senator HATCH. Right. After your own questioning of the Senior Counsel and Assistant Counsel, the RTC selected Mr. Stephens sometime toward the end of January. Is that right? Ms, KuLKA. Mr. Stephens' firm, sir, yes. Senator HATCH. His firm but, in essence, he became one of the counsel. Ms. KuLKA. That's correct. 52 Senator HATCH. Is it accurate to say when outside counsel is hired, the counsel reports to the RTC and the RTC retains final authority over decisions the outside counsel makes on whether to pro- ceed with litigation in any particular case? Ms. KULKA. Absolutely. Senator HATCH. That's my understanding, and is that the rela- tionship that the RTC entered with Mr. Stephens? Ms. KuLKA. Yes, sir. Senator HATCH. Is the RTC's hiring of outside counsel made public? Ms. KULKA, It depends on the circumstances. Senator HATCH, With regard to Fiske and civil jurisdiction when you say "it depends on the circumstances," what does that mean? Ms. KULKA. It depends on whether making anyone aware of the fact that we've hired counsel can affect our strategy in our litigation. Senator HATCH. So, you might withhold that Ms. KULKA. You might withhold it or you might publish it. Senator HATCH. Most of the time it's published, OK. To the Fiske civil jurisdiction, do you recall, shortly after having hired Mr. Stephens, having learned of the Independent Counsel's charter and its arguable grant of civil jurisdiction? Ms. KULKA, I actually think I may have been aware of that before the firm was retained. Senator HATCH. Is it true you bad discussions with Mr. Fiske concerning the scope of the Independent Counselship? Ms. KULKA. I think they were more casual than that. Senator HATCH. But, nevertheless, discussions. Ms. KuLKA. Tangentially.