This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 03 ROME 002284 
 
SIPDIS 
 
DEPARTMENT FOR EUR/WE, IRL 
 
E.O. 12958: DECL: 05/22/2018 
TAGS: PGOV PHUM PHUM PHUM IT ITPGOV ITPGOV
SUBJECT: BERLUSCONI,S TRIAL SEPARATED FROM CO-DEFENDANTS; 
STAGE SET FOR "GUILTY BY ASSOCIATION" VERDICT 
 
REF: A. ROME 1971 
 
     ¶B. ROME 1835 
     ¶C. ROME 737 
                       CONFIDENTIAL 
 
PAGE 02        ROME  02284  01 OF 03  221737Z 
     ¶D. ROME 355 
 
CLASSIFIED BY: A/DCM THOMAS COUNTRYMAN, REASON 1.5 (D). 
 
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SUMMARY 
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¶1.  (C)  A MAY 16 COURT DECISION TO SEPARATE THE PROSECUTION 
OF PRIME MINISTER BERLUSCONI FROM OTHER DEFENDANTS IN A 
CORRUPTION TRIAL WILL STRING OUT LEGAL PROCEEDINGS AGAINST 
THE PM AND CERTAINLY EXACERBATE DOMESTIC POLITICAL BATTLES 
AND INSTITUTIONAL STRUGGLES BETWEEN THE GOVERNMENT AND 
JUDICIARY.  THE EXPECTED GUILTY VERDICT AGAINST BERLUSCONI'S 
CO-DEFENDANTS SETS THE STAGE FOR A "GUILTY-BY-ASSOCIATION" 
VERDICT AGAINST THE PRIME MINISTER HIMSELF.  BUT NONE OF THIS 
SHOULD HAVE A DRAMATIC IMPACT ON ITALY'S UPCOMING EU 
PRESIDENCY OR RUPTURE BERLUSCONI'S COALITION GOVERNMENT, 
WHICH WE STILL THINK WILL BE THE FIRST ITALIAN POSTWAR 
GOVERNMENT TO SERVE ITS FULL FIVE-YEAR TERM.  AT MOST, IT MAY 
IMPEDE BERLUSCONI'S ABILITY TO PERSUASIVELY BROKER THE 
BACKROOM DEALS THAT ARE PART AND PARCEL OF EU SUMMITS, BUT WE 
EXPECT MOST FELLOW EU LEADERS WILL CONTINUE DEALING WITH HIM 
MUCH AS THEY HAVE.  THE COURT'S DECISION AND THE EXPECTED 
GUILTY VERDICT MATTER MOST TO ITALY'S POLITICIANS; MOST OF 
THE PUBLIC IS INDIFFERENT.  END SUMMARY. 
 
--------------- 
THE PROCEEDINGS 
--------------- 
¶2.  (U)  ON MAY 16, THE MILAN TRIBUNAL CONSIDERING THE "SME" 
JUDICIAL BRIBERY CASE AGAINST PM SILVIO BERLUSCONI DECIDED TO 
                       CONFIDENTIAL 
 
PAGE 03        ROME  02284  01 OF 03  221737Z 
SPLIT THE TRIAL.  THE CASE STEMS FROM THE 1985 PROPOSED SALE 
OF THE THEN-STATE-OWNED SME FOOD HOLDING COMPANY.  BERLUSCONI 
IS ACCUSED AS AN ACCESSORY TO JUDICIAL BRIBERY IN COMPLICATED 
JUDICIAL PROCEEDINGS ARISING FROM THE EVENTUAL SALE.  (NOTE: 
THE CASE WAS BROUGHT AGAINST HIM BY THE MILAN COURT IN 1995, 
SOME TEN YEARS AFTER THE ALLEGED CORRUPTION OCCURRED.  END 
NOTE.)  CESARE PREVITI, DEFENSE MINISTER IN THE FIRST 
BERLUSCONI GOVERNMENT, FORZA ITALIA PARLIAMENTARIAN, AND A 
FORMER LAWYER TO THE PM, IS A CO-DEFENDANT, ALONG WITH SEVEN 
OTHERS.  DURING THE SCHEDULED MAY 16 HEARING, BERLUSCONI'S 
LAWYERS REQUESTED YET ANOTHER DELAY OF THE TRIAL (THE SIXTH), 
DUE TO GOVERNMENT DEMANDS WHICH, THEY CLAIMED, MADE IT 
IMPOSSIBLE FOR BERLUSCONI TO APPEAR. 
 
¶3.  (SBU)  PRESIDING JUDGE LUISA PONTI SUGGESTED THAT 
BERLUSCONI BE TRIED SEPARATELY FROM THE OTHER DEFENDANTS TO 
AVOID HAVING HIS SCHEDULING CONFLICTS FURTHER DELAY THE 
PROCEEDINGS AGAINST THE OTHERS.  THUS, THE TRIBUNAL 
DETERMINED, THE CASE AGAINST THE EIGHT CO-DEFENDANTS WILL 
PROCEED; THE NEXT HEARING, AT WHICH PROSECUTOR ILDA 
BOCCASSINI IS EXPECTED TO PRESENT HER CONCLUDING SPEECH, IS 
SET FOR MAY 23.  THE PRIME MINISTER'S TRIAL, MEANWHILE, WILL 
BE CONDUCTED AT ITS OWN PACE, IN KEEPING WITH THE PM'S 
SCHEDULE -- BEFORE THE SAME TRIBUNAL.  IT MUST, HOWEVER, 
START FROM SCRATCH, AS IT IS TECHNICALLY A NEW TRIAL. 
(COMMENT:  IRONICALLY FROM A U.S. PERSPECTIVE, THE SAME 
TRIBUNAL CAN CONSIDER THE CASE, EVEN IF THE REMAINING 
DEFENDANTS ARE FOUND GUILTY.  AS U.S. DEFENSE ATTORNEYS TELL 
US WHEN VISITING ITALY, THEY WOULD NOT WANT TO DEFEND A CASE 
HERE.  END COMMENT.) 
 
                       CONFIDENTIAL 
 
PAGE 04        ROME  02284  01 OF 03  221737Z 
------------ 
THE REACTION 
------------ 
¶4.  (SBU)  THE CENTER-LEFT IMMEDIATELY WELCOMED THE 
MAGISTRATES' DECISION, SAYING IT ALLOWS JUSTICE TO RUN ITS 
COURSE WITH DUE CONSIDERATION FOR THE PRIME MINISTER'S 
SCHEDULE.  FORMER MANI PULITE (CLEAN HANDS) PROSECUTOR AND 
LEADER OF THE "ITALY OF VALUES" PARTY ANTONIO DI PIETRO 
CAPTURED THE OPPOSITION VIEWPOINT ELOQUENTLY:  THE DECISION, 
HE SAID, SAFEGUARDS THE DELICATE FUNCTION WHICH BERLUSCONI IS 
ABOUT TO ASSUME WITH THE EU PRESIDENCY WHILE ALLOWING JUSTICE 
TO RUN ITS COURSE.  AT THE SAME TIME, IT GUARANTEES 
PROSECUTION OF THE SME CASE, PERMITTING THE CITIZENS TO KNOW 
THE TRUTH AS SOON AS POSSIBLE, PERHAPS IN TWO-THREE WEEKS. 
PARLIAMENT NEED NO LONGER CONSIDER THE "LODO MACCANICO" 
(PROPOSAL TO PROVIDE "TEMPORARY IMMUNITY" BY SUSPENDING CASES 
AGAINST HIGH GOVERNMENT OFFICIALS WHILE IN OFFICE).  AND 
ABOVE ALL, THE CITIZENS WILL UNDERSTAND WHO WAS THE 
INSTIGATOR OF ALL THE CASES, WHETHER THE SME CASE OR THE 
"LODO MONDADORI" CASE (IN WHICH BERLUSCONI ASSOCIATE PREVITI 
WAS RECENTLY FOUND GUILTY OF BRIBING JUDGES AND SENTENCED TO 
11 YEARS IN PRISON; HE IS APPEALING THE VERDICT.)  AND THIS, 
DI PIETRO CONCLUDED, WILL HAVE POLITICAL CONSEQUENCES ALSO 
FOR BERLUSCONI.  (COMMENT:  AS NOTED IN 02 MILAN 259, DI 
 
                       CONFIDENTIAL 
 
                           CONFIDENTIAL     PTQ2711 
 
PAGE 01        ROME  02284  02 OF 03  221737Z 
ACTION EUR-00 
 
INFO  LOG-00   NP-00    AID-00   AMAD-00  CIAE-00  INL-00   DODE-00 
      SRPP-00  DS-00    EB-00    VC-00    TEDE-00  INR-00   IO-00 
      LAB-01   L-00     VCE-00   AC-01    NSAE-00  NSCE-00  OIC-02 
      OMB-01   OPIC-01  PA-00    PM-00    PRS-00   ACE-00   P-00 
      SCT-00   SP-00    STR-00   TRSE-00  USIE-00  PMB-00   DSCC-00 
      PRM-00   DRL-01   G-00     NFAT-00  SAS-00     /007W 
                  ------------------699B60  221737Z /38 
P 221731Z MAY 03 
FM AMEMBASSY ROME 
TO SECSTATE WASHDC PRIORITY 0058 
INFO EUROPEAN POLITICAL COLLECTIVE 
AMCONSUL FLORENCE 
AMCONSUL MILAN 
AMCONSUL NAPLES 
 
C O N F I D E N T I A L SECTION 02 OF 03 ROME 002284 
 
SIPDIS 
 
DEPARTMENT FOR EUR/WE, IRL 
 
E.O. 12958: DECL: 05/22/2018 
TAGS: PGOV PHUM PHUM PHUM IT ITPGOV ITPGOV
SUBJECT: BERLUSCONI,S TRIAL SEPARATED FROM CO-DEFENDANTS; 
STAGE SET FOR "GUILTY BY ASSOCIATION" VERDICT 
 
PIETRO IS NOT A LEFTIST EXTREMIST; HE IS IN FACT A CENTRIST. 
HOWEVER, HE CONSIDERS BERLUSCONI A "MORTAL ENEMY" OF 
DEMOCRACY AND THE LEGAL SYSTEM.  END COMMENT.) 
                       CONFIDENTIAL 
 
PAGE 02        ROME  02284  02 OF 03  221737Z 
 
¶5.  (SBU)  NOT SURPRISINGLY, THE CENTER-RIGHT -- MOST VOCALLY 
THE PRIME MINISTER HIMSELF -- SEES THINGS DIFFERENTLY.  IT 
VIEWS THE MOVE BY THE TRIBUNAL AS YET ANOTHER EXAMPLE OF 
BLATANT ACTION BY A POLITICIZED JUDICIARY TO MANIPULATE THE 
JUDICIAL SYSTEM TO ACHIEVE WHAT THEY CANNOT AT THE BALLOT BOX 
-- DESTRUCTION OF THE CENTER-RIGHT GOVERNMENT, INDEED THE 
ENTIRE CENTER-RIGHT POLITICAL STRUCTURE.  CENTER-RIGHT 
REPRESENTATIVES CHARGE THAT, BY SPLITTING THE SME TRIAL, THE 
MAGISTRATES GUARANTEED THAT THE TRIAL OF BERLUSCONI'S 
CO-DEFENDANTS WOULD CONTINUE, LEADING TO AN EXPECTED GUILTY 
VERDICT, PRESUMED BY ALMOST ALL ITALIANS TO BE IMMINENT. 
THEY ASSERT THAT THIS IS A DELIBERATE ATTEMPT TO REFLECT THE 
"GUILT" OF OTHERS ONTO THE PRIME MINISTER, EVEN AT THE RISK 
OF JEOPARDIZING HIS EFFECTIVENESS WHILE ITALY HOLDS THE EU 
PRESIDENCY.  AS FORZA ITALIA DEPUTY AND FORMER INTERIOR UNDER 
SECRETARY CARLO TAORMINA SAID WHEN THE DECISION WAS MADE 
 
SIPDIS 
PUBLIC, "IT WILL GRAVELY PREJUDICE THE (PRIME MINISTER'S) 
CASE."  HE ADDED THAT A GUILTY VERDICT WOULD "CERTAINLY" BE 
ISSUED IN THE CASE AGAINST BERLUSCONI'S CO-DEFENDANTS, 
BECAUSE "IT IS THE MILANESE SYSTEM."  (COMMENT:  MAGISTRATES 
IN MILAN HAVE A PREDOMINANTLY LEFTIST ORIENTATION; THEIR 
NUMBER INCLUDES SOME WHO SPEAK OF A SACRED OBLIGATION TO 
PURSUE "DEMOCRATIC REVOLUTION" THROUGH THE COURTS.  END 
COMMENT.) 
 
--------------------------------- 
MEANWHILE, BACK AT THE PARLIAMENT 
--------------------------------- 
¶6.  (U)  IN THE MEANTIME, BERLUSCONI CONTINUES TO PRESS FOR 
JUDICIAL REFORM AND THE REINSTATEMENT OF PARLIAMENTARY 
                       CONFIDENTIAL 
 
PAGE 03        ROME  02284  02 OF 03  221737Z 
IMMUNITY (ABOLISHED IN THE AFTERMATH OF ITALY'S CORRUPTION 
SCANDALS).  THAT REQUIRES A CONSTITUTIONAL AMENDMENT, 
HOWEVER, AND IS A MONTHS-LONG PROCESS.  WHILE THERE IS SOLID 
AGREEMENT IN HIS MAJORITY COALITION ON THE NEED FOR REFORM, 
THERE IS SOME DIFFERENCE IN THE DETAILS.  DEPUTY PRIME 
MINISTER GIANFRANCO FINI (NATIONAL ALLIANCE), FOR EXAMPLE, 
HAS DEMURRED PUBLICLY THAT "WE CANNOT GO BACK TO TEN YEARS 
AGO" (I.E., FULL PARLIAMENTARY IMMUNITY, SUGGESTING SOMETHING 
LESS MIGHT BE ACCEPTABLE).  THERE ARE BOTH CONSENSUS WITHIN 
THE MAJORITY AND INDICATIONS OF SUPPORT FROM PRESIDENT CIAMPI 
FOR THE SO-CALLED "LODO MACCANICO" PROPOSAL TO SUSPEND TRIALS 
FOR THE FIVE HIGHEST INSTITUTIONAL FIGURES (PRESIDENTS OF THE 
REPUBLIC, CONSTITUTIONAL COURT, SENATE, AND CHAMBER OF 
DEPUTIES, AND THE PRIME MINISTER) WHILE THEY ARE IN OFFICE. 
IF SUCH A LEGAL PROVISION WERE TO PASS, THE BERLUSCONI TRIAL 
WOULD BE SUSPENDED UNTIL HE NO LONGER HELD OFFICE.  (NOTE: 
WE PRESUME, ALTHOUGH IT IS STILL UNCLEAR, THAT THE STATUTE OF 
LIMITATIONS WOULD ALSO BE SUSPENDED FOR THE INTERVAL.  END 
NOTE.)  CENTER-RIGHT CRITICS COMPLAIN, HOWEVER, THAT THE 
ACTION BY THE MILAN TRIBUNAL RENDERS FURTHER DISCUSSION OF 
THE LODO MACCANICO MEANINGLESS, AS BERLUSCONI WILL BE 
EFFECTIVELY TRIED "IN ABSENTIA" AT THE CONTINUING TRIAL OF 
THE SEVEN CO-DEFENDANTS. 
 
--------------------------------------------- 
SO, CAN BERLUSCONI EFFECTIVELY MANAGE ITALY'S 
EU PRESIDENCY?  AND WILL THE COALITION HOLD? 
--------------------------------------------- 
¶7.  (C)  WITH APOLOGIES TO VON CLAUSWITZ, LEGAL PROCEEDINGS 
IN ITALY ARE OFTEN POLITICS BY OTHER MEANS.  THE PROSPECT OF 
A GUILTY VERDICT -- WHETHER DIRECT OR BY ASSOCIATION -- 
                       CONFIDENTIAL 
 
PAGE 04        ROME  02284  02 OF 03  221737Z 
AGAINST PRIME MINISTER BERLUSCONI HAS THE OPPOSITION 
SALIVATING AND HOPING TO TRANSLATE IT INTO ELECTORAL GAINS IN 
MAY 25-26 LOCAL ELECTIONS.  THE INTEREST OF THE "ECONOMIST" 
AND OTHERS ASIDE, HOWEVER, AND SOMEWHAT CONTRARY TO WHAT WE 
MIGHT EXPECT, WE HAVE YET TO SEE THAT BERLUSCONI'S LEGAL 
TRAVAILS MAKE A DIFFERENCE TO THE ITALIAN ELECTORATE.  THE 
PRIME MINISTER CONTINUES TO EVOKE STRONG FEELINGS IN 
ITALIANS, AND THEY HAVE ALREADY DECIDED WHAT THEY THINK OF 
HIM; WE SEE LITTLE EVIDENCE THAT THIS TRIAL, WHATEVER ITS 
OUTCOME, WILL CHANGE MANY MINDS. 
 
¶8.  (C)  THE JUDICIAL PROBLEMS MATTER MORE ON THE 
INTERNATIONAL SCALE, TO THE EXTENT THEY IMPEDE BERLUSCONI'S 
ABILITY TO LEAD EFFECTIVELY ITALY'S EU PRESIDENCY AND ADVANCE 
U.S. INTERESTS.  WE DO NOT SEE THE IMPACT HERE TO BE THAT 
GREAT, EITHER.  IT IS TRUE THAT BERLUSCONI IS MORE DISTRACTED 
BY THE NEED TO ATTEND TO HIS JUDICIAL AFFAIRS, BUT HE IS A 
MAN OF GREAT ENERGY AND IT DOES NOT SEEM TO CAUSE EITHER 
DISRUPTION IN COALITION MANAGEMENT OR LACK OF ATTENTION TO 
ISSUES WHICH DEMAND IT.  HE ALSO HAS MANY ABLE SUBORDINATES, 
FROM FINI TO FOREIGN MINISTER FRATTINI TO INTERIOR MINISTER 
PISANU AND MORE.  SOME SUGGEST A GUILTY VERDICT, WHETHER 
DIRECT OR BY ASSOCIATION, MIGHT WEAKEN HIS STATURE VIS-A-VIS 
HIS EUROPEAN COLLEAGUES DURING THE PRESIDENCY.  THAT PROBABLY 
 
                       CONFIDENTIAL 
 
                           CONFIDENTIAL     PTQ2712 
 
PAGE 01        ROME  02284  03 OF 03  221737Z 
ACTION EUR-00 
 
INFO  LOG-00   NP-00    AID-00   AMAD-00  CIAE-00  INL-00   DODE-00 
      SRPP-00  DS-00    EB-00    VC-00    TEDE-00  INR-00   IO-00 
      LAB-01   L-00     VCE-00   AC-01    NSAE-00  NSCE-00  OIC-02 
      OMB-01   OPIC-01  PA-00    PM-00    PRS-00   ACE-00   P-00 
      SCT-00   SP-00    STR-00   TRSE-00  USIE-00  PMB-00   DSCC-00 
      PRM-00   DRL-01   G-00     NFAT-00  SAS-00     /007W 
                  ------------------699B65  221737Z /38 
P 221731Z MAY 03 
FM AMEMBASSY ROME 
TO SECSTATE WASHDC PRIORITY 0059 
INFO EUROPEAN POLITICAL COLLECTIVE 
AMCONSUL FLORENCE 
AMCONSUL MILAN 
AMCONSUL NAPLES 
 
C O N F I D E N T I A L SECTION 03 OF 03 ROME 002284 
 
SIPDIS 
 
DEPARTMENT FOR EUR/WE, IRL 
 
E.O. 12958: DECL: 05/22/2018 
TAGS: PGOV PHUM PHUM PHUM IT ITPGOV ITPGOV
SUBJECT: BERLUSCONI,S TRIAL SEPARATED FROM CO-DEFENDANTS; 
STAGE SET FOR "GUILTY BY ASSOCIATION" VERDICT 
 
OVERSTATES THE CASE; THERE IS LITTLE TO SUGGEST IT WILL 
AFFECT MANAGEMENT OF BASIC PRESIDENCY RESPONSIBILITIES OR THE 
OVERALL RELATIONSHIPS BETWEEN BERLUSCONI AND HIS COUNTERPARTS 
                       CONFIDENTIAL 
 
PAGE 02        ROME  02284  03 OF 03  221737Z 
(FOR BETTER OR WORSE).  INDEED, THE FRENCH DCM TOLD US ON THE 
DAY OF THE DECISION TO SPLIT THE CASES THAT IT WAS IRRELEVANT 
TO HIS GOVERNMENT, PROVIDED BERLUSCONI PAID ATTENTION TO EU 
MATTERS WHILE ITALY HELD THE PRESIDENCY.  IT MIGHT IMPACT ON 
BERLUSCONI'S ABILITY TO BROKER THE LAST-MINUTE, BACKROOM 
DEALS OF WHICH EU SUMMITS ARE MADE, BUT AGAIN, WE THINK THE 
LIKELIHOOD IS MINIMAL. 
 
¶9.  (C)  WILL THE GOVERNMENT STAND?  WE THINK IT WILL, AND AS 
OF NOW WE CONTINUE TO PREDICT IT WILL BE THE FIRST POST-WAR 
GOI TO COMPLETE ITS FIVE-YEAR TERM.  WHILE THERE MAY BE 
DIFFERENCES AMONG SOME COALITION PARTNERS AS TO HOW BEST TO 
REFORM THE JUDICIARY, OR THE SPEED AT WHICH THAT REFORM 
SHOULD PROCEED, AS WELL AS ON ISSUES COMPLETELY UNRELATED TO 
THE JUDICIARY, WE SEE VIRTUAL UNANIMITY IN THE BELIEF THAT 
THE MAGISTRACY IS HIGHLY POLITICIZED AND THAT IT SEEKS TO 
ACCOMPLISH POLITICAL "REVOLUTION" THROUGH THE JUDICIAL 
SYSTEM.  THIS WILL NOT BE THE ISSUE THAT BREAKS THE COALITION. 
 
¶10.  (C)  A GUILTY VERDICT WOULD BE EMBARRASSING, BUT IT 
WOULD NOT HINDER THE GOVERNMENT'S IMAGE OR PROGRAM. 
RELATIONS WITH THE OPPOSITION WILL REMAIN AT LOGGERHEADS, AS 
THEY WILL WITH THE JUDICIARY -- BUT BOTH ARE FRUITLESS NOW. 
(BERLUSCONI ANNOUNCED ON MAY 22 THAT HE WANTED TO SPEED 
CONSIDERATION OF THE GOI'S JUDICIAL REFORM PROPOSALS, 
INCLUDING SEPARATION OF CAREER TRACKS FOR PROSECUTORS AND 
JUDGES -- ANOTHER GAUNTLET FLUNG AT THE MAGISTRACY.)  THE 
GOVERNMENT RECOGNIZES THE DRAWBACKS, AND PERHAPS ABOVE ALL 
THE DISTRACTION, OF SUCH A VERDICT, AND THAT IS WHY 
BERLUSCONI, SENATE PRESIDENT PERA, CHAMBER PRESIDENT CASINI, 
UNION OF CHRISTIAN DEMOCRATS (UDC) SECRETARY FOLLINI, AND 
                       CONFIDENTIAL 
 
PAGE 03        ROME  02284  03 OF 03  221737Z 
NORTHERN LEAGUE SECRETARY BOSSI AGREE THAT SOME FORM OF 
IMMUNITY/SUSPENSION OF CASES AGAINST THE PRIME MINISTER IS 
IMPERATIVE.  BUT WHATEVER THE VERDICT, BE IT AGAINST HIS 
ASSOCIATES OR AGAINST HIM PERSONALLY, BERLUSCONI WILL RESPOND 
THE SAME WAY:  HE WILL CHARGE THAT IT IS A POLITICAL DECISION 
BY A POLITICIZED JUDICIARY, DECLARE HIS INNOCENCE, FILE AN 
APPEAL -- AND MOVE ON.  HE IS, UNDER ITALIAN LAW, INNOCENT 
UNTIL ALL APPEALS ARE EXHAUSTED.  THE OPPOSITION WOULD HOWL 
-- BUT THEY DO A LOT OF THAT ANYWAY.  WOULD IT AFFECT ITALIAN 
VOTES IN THE 2004 EUROPEAN PARLIAMENT ELECTIONS OR THE 2006 
NATIONAL ELECTIONS?  MAYBE -- BUT WE WOULDN'T BET ON IT. 
SKODON 
 
                       CONFIDENTIAL 
 
> 
 2003ROME02284 - Classification: CONFIDENTIAL