Split Verdict in Theft Trial of MEM Executives

Easton, Northampton County - There is a split verdict in the theft trial for two Lackawanna County businessmen.

Robert Kearns and PJ McLaine have been on trial this week at the Northampton County courthouse in Easton.

Prosecutors accused the men of pocketing more than $832,000 from taxpayers in Bethlehem Township.

Just after 6:00 PM Friday night, after nearly eight hours of deliberations, jurors returned their verdict.

They found both men guilty on one count of theft by failure to make required disposition of funds. Both men were found not guilty on two lesser counts. They were another count of theft and criminal conspiracy.

Both men left the courthouse minutes later surrounded by their family and friends.

"This is what we felt from day one, that they took possession of these monies, they were for a designated purpose and when the time caem, they didn't have the money to deliver," District Attorney John Morganelli said. "They used the money for their own business purposes and wrote large checks to themselves."

Kearns and McLaine ran a company known as "MEM," Municipal Energy Managers. They got the money from Bethlehem Township after promising to purchase the township's streetlights from PPL and maintain them in 2007. Prosecutors said they never did any work.

Defense lawyers said this case belonged in civil court and vow to appeal.

"If they actually believe that he (McLaine) committed the theft, then they had to believe that he conspired with Mr. Kearns but they found him not guilty of the conspiracy so it's kinda like a perplexing verdict to me," defense attorney Paul Walker said.

"The jury obviously wrestled with whether or not this was a criminal case just by the length of their deliberations and the three times they reported being at an impasse," defense attorney James Swetz said.

Northampton County was the first county to criminally charge the two businessmen but the district attorney says he's already been contacted by Lehigh, Bucks and other counties and they were just waiting to see how this case panned out.

"I think ou're going to see more charges filed by other counties and I think the troubles for Mr. McLaine and Mr. Kearns are really just starting," Morganelli said.

Both men face up to seven years in prison.

They are scheduled to be sentenced on March 15th.