Livent founders sentenced to prison terms

TORONTO – Garth Drabinsky has been sentenced to seven years in jail while partner Myron Gottlieb received a six-year term for orchestrating an accounting fraud at Livent Inc., their theatre company that produced such lauded fare as Kiss of the Spider Woman and Showboat.

The sentence was handed down by Ontario Superior Court of Justice Mary Lou Benotto, the same judge who found the two men guilty of fraud and forgery in March.

The Crown was seeking eight to 10 years in prison for the co-founders of Livent, who were convicted of running the fraud at the theatre company over a number of years. More than $500-million was raised from investors based on false financial statements between 1993 and 1998 that understated expenses, sometimes by millions of dollars in a single quarter.

Lawyers for Drabinsky and Gottlieb had asked for conditional sentences or house arrest, with community service that could include lectures at business and theatre schools across the country.

Some 50 spectators, lawyers and court staff were in the downtown courtroom on Wednesday to see how this most recent chapter of the 10-year-old saga would end.

Drabinsky’s lawyer Edward Greenspan had cited his client’s childhood bout with polio among the reasons jail would not be an appropriate punishment.

The men also received letters of support from notables including theatre luminaries Christopher Plummer and E.L. Doctorow, and business heavyweights Seymour Shulich, Joseph Rotman and Peter Godsoe, which were presented to the judge.

White collar criminals in Canada are usually granted bail while they appeal, in contrast with those convicted in the United States. Conrad Black, for example, remains incarcerated in a Florida prison pending a Supreme Court review of his fraud convictions in Chicago.

In another sharp contrast with the U.S. justice system, it took ten years for the Livent case to reach this stage. In 1999, Drabinsky and Gottlieb were charged with fraud by the U.S. Attorney’s Office in the Southern District of New York, shortly after the company received a cash injection from a group of investors including Hollywood mogul Michael Ovitz. But in 2002, the RCMP moved in with its own charges in Canada, which placed the U.S. indictment on indefinite hold.