TOKYO — Legal professionals defending former Nissan director Greg Kelly, the American accused of conspiring to hide Carlos Ghosn’s huge paychecks from the general public, took their first crack at cross-examining a key state witness final week and argued that prosecutors had violated Japan-U.S. extradition legal guidelines by setting a lure to arrest the Tennessee govt on Japanese soil.

Kelly’s authorized group tried to poke holes within the case by displaying the witness to have a defective reminiscence and by casting doubt on the extent of Kelly’s involvement in alleged schemes to cover Ghosn’s pay.

In the meantime, as that trial continued in Tokyo, a separate case kicked off simply south of the capital in Yokohama, the place Nissan Motor Co. is suing Ghosn for almost $100 million in damages over allegations of economic misconduct and misappropriation of funds. Because the second case started, Ghosn issued an announcement from Lebanon, the place he’s dwelling in self-imposed exile, denouncing the claims as having “completely no basis.”

The separate trials underscore how Nissan continues to be struggling to place the Ghosn scandal into the rearview mirror almost two years after the Nov. 19, 2018, arrest of its hard-charging chairman.

On that day, Ghosn and Kelly have been nabbed by Japanese authorities inside hours of one another after touchdown in Japan for enterprise conferences. Kelly’s U.S. lawyer stated prosecutors lured Kelly to Japan underneath false pretenses as an alternative of going by way of correct channels.

On the time, Nissan govt Hari Nada, working with Japanese prosecutors underneath a plea-bargain deal, referred to as Kelly at his house close to Nashville, telling him he was wanted in Japan for pressing enterprise. Nada even had Nissan rent a constitution jet to fetch him.

“It is a violation of the U.S.-Japanese extradition treaty,” Kelly lawyer James Wareham stated. “He was lied to by a non-public actor who was performing on the course of the state of Japan.”

Wareham contrasted that with the dealing with of two People at the moment combating extradition to Japan, the place they’re accused of serving to Ghosn escape from home arrest in Tokyo to flee to Lebanon on the finish of 2019. These people have been first picked up by U.S. authorities and fought extradition in courtroom. Despite the fact that the U.S. State Division has dominated they are often despatched to Japan, the matter is underneath continued evaluation.

“Kelly by no means bought that,” Wareham stated. “He by no means bought the State Division’s examination. He by no means bought his day in courtroom.

“Worldwide legislation has been violated, and there is likely to be cures.”

Kelly is accused of conspiring with Ghosn to hide greater than $80 million in deferred compensation when Ghosn was Nissan chairman and CEO. At Kelly’s legal trial, his Japanese lawyer took intention at Toshiaki Ohnuma, one other plea bargainer and witness for the state.

Ohnuma, who took the stand in September and is predicted to maintain testifying into December, says he was personally concerned in exploring varied cost schemes for Ghosn and in the end helped arrange a deferred compensation association that prosecutors say broke the legislation.

However the courtroom testimony to this point has not proven that any of Ghosn’s underlings settled on a method to disburse the funds as a result of they could not appear to discover a authorized manner that would not require disclosure.

Apart from Kelly, who was a senior human sources govt with Nissan, a small military of different executives and managers was wrapped up within the work, in accordance with courtroom testimony.

That rising image has opened an as-yet-unanswered query as to why the American govt was singled out for Japanese prosecution.

Ohnuma’s testimony final week revealed a lower than bulletproof reminiscence about a number of particulars, together with such issues as how a lot Kelly actually knew in regards to the cost schemes, specifics of Ghosn’s pay and what precisely Kelly’s position was behind the scenes. Ohnuma stated he adopted Kelly’s orders to discover varied routes of paying Ghosn a part of his remuneration so it might not need to be disclosed.

Ohnuma stated he felt among the avenues explored have been unlawful however that he could not object.

“He was my superior,” Ohnuma stated of Kelly. “I needed to comply with his instruction. Now, I remorse it.”

Ohnuma testified that Kelly instructed him Ghosn was involved about disclosing the complete sum of his remuneration, in search of to keep away from public scrutiny not solely in Japan, but in addition in France. Ghosn, who was concurrently head of Nissan and alliance companion Renault, was delicate in regards to the measurement of his pay in each international locations, the place extra modest govt compensation is the norm, even for very top-tier enterprise leaders.

Each Kelly and Ghosn deny the costs. However whereas Ghosn fled Japan for Beirut, past the attain of Japanese extradition legislation, Kelly stays in Japan to face trial. The proceedings are anticipated to run by way of July, and Kelly, now 64, may very well be sentenced to as much as 15 years in jail if discovered responsible.

Prosecutors allege Ghosn’s underlings started scrambling to cover his pay in 2010, the 12 months Japan modified its company reporting guidelines to require executives with huge pay packages — these greater than ¥100 million ($950,000) a 12 months — to reveal particular person compensation. Ghosn had been the item of some public criticism for pulling certainly one of Japan’s highest salaries and needed to keep away from public criticism, they are saying.

By Ohnuma’s telling, Ghosn was receiving round $15.2 million a 12 months on the time, and the preliminary aim, he testified, was to convey the publicly disclosed sum right down to round $8.6 million, within the perception that determine can be extra palatable to Japanese sensibilities.

From then on, Nissan officers investigated other ways to pay Ghosn much less within the public’s eye, whereas sending him the stability by way of different channels, Ohnuma stated. Whether or not any such plans have been ever truly mounted and finalized is prone to be a pivotal level of competition in Kelly’s trial, as will the extent of the manager’s private involvement.

Ghosn faces two extra breach-of-trust prices for which solely he’s indicted. He’s accused of improperly siphoning thousands and thousands of {dollars} from Nissan for his personal non-public use. The Nissan civil trial that opened final week is an try to assert damages.

Nissan filed in February after Ghosn fled Japan earlier than his legal trial might begin.

“The authorized actions kind a part of Nissan’s coverage of holding Ghosn accountable for the hurt and monetary losses incurred by the corporate on account of his misconduct,” the automaker stated on the time. It famous that it was stepping up its claims in opposition to Ghosn following his “unlawful flight from justice.”

Ghosn’s protection lawyer stated final week that Nissan is stalling on offering proof to show its case. As a result of the courtroom continues to be ready for Nissan to supply extra documentation, and since the protection must translate the paperwork into English for Ghosn’s evaluation, the subsequent listening to will not be till March 19.

Nissan is in search of $95 million in damages, an quantity that covers the roughly $87.4 million the corporate acknowledges owing Ghosn in deferred compensation, stated Ghosn’s lawyer Nobuo Gohara. That compensation, which was by no means paid out, is the crux of the primary set of allegations leveled in opposition to each Ghosn and Kelly two years in the past.

“Sadly, there isn’t a prospect that Ghosn’s legal trial might be held in Japan,” Gohara stated. “So this civil swimsuit is the place the place we are able to solely discover out in regards to the fact of this case.

“This civil swimsuit revolves round precisely the legal circumstances in opposition to Ghosn that Nissan is making an attempt to show,” he stated. “This swimsuit accommodates many overlaps with issues that ought to have been mentioned in a legal trial.”