Ghosn's new legal team directs blame at Nissan

TOKYO — As embattled former Renault-Nissan Chairman Carlos Ghosn heads into his fourth month locked in a Japanese jail, his lawyers are mounting a reinvigorated legal offensive that focuses the blame on Nissan.

The new narrative hints at conspiracy with a simple message: The case is "not normal."

Ghosn, held in a Tokyo detention center since his Nov. 19 arrest on financial misconduct charges, replaced his legal team this month to spearhead a more aggressive defense as the case heads to trial. The team came out swinging in its first press conference last week.

Junichiro Hironaka — nicknamed the Razor for his cutting questions — blamed Nissan for his client's legal troubles. Hironaka said disputes over Ghosn's compensation and other financial dealings were an in-house corporate concern.

"It seems to me that this is Nissan's internal problem," Hironaka said. "It hasn't caused any specific problems or dangers and hasn't caused any damage to anyone. Nissan is supposed to handle this internally, but somehow the company has brought the case to prosecutors. In principle, prosecutors should not get involved in civil cases, but they did."

Hironaka said Ghosn's prosecution is tarnishing Japan's global image by rattling the confidence of the country's international business community and by highlighting Japanese legal practices that are sometimes out of sync with those in other Western democracies.

"This case has sent shock waves through the world, and it is a huge problem for Japan's business development on the whole," Hironaka said. "This case also raises questions about Japan's justice system. This is a good opportunity to bring Japan's system in line with international standards."

Ghosn dumped his previous lawyers partly because they were not aggressive enough and partly because they disagreed over messaging and direction, according to a person familiar with Ghosn's thinking. Ghosn has been telling his side through jailhouse media interviews, describing his arrest as part of a Nissan coup to block his efforts to merge the Japanese automaker with Renault.

Japan's Asahi newspaper reported last week that Nissan asked the Paris office of law firm Latham & Watkins last year to draw up a defense strategy against a full management integration.

A person familiar with the situation said the law firm was engaged to conduct scenario planning on future directions for the alliance, not to actually implement any such plans.

Ghosn is better able to plan a defense these days.

After his final indictments came down in January, the rules of his detention changed. He now has the right to refuse interrogation by prosecutors and can meet with his lawyers for prolonged periods.

In the weeks after his initial arrest, prosecutors could question him for hours each day in the absence of his attorney. Ghosn can also receive visitors now, including family members — though such visits are typically restricted to once a day for 15 minutes.

Prosecutors have slapped Ghosn with three indictments, two for allegedly misreporting tens of millions of dollars in deferred compensation and a third concerning alleged breach of trust.

Ghosn, 64, faces up to 10 years in prison if found guilty. Hironaka said the trial would likely start after summer.

Ghosn's attorney also suggested wider political pressures were weighing on the case.

"I don't think this investigation was decided only by the prosecutors concerned," Hironaka said.

He added: "I doubt the Japanese government has little interest in this case. I think the powers that be of Japan must have steered this into the current direction. Nissan could have dealt with this case internally through various procedures, but instead they jumped all that and brought the case directly to prosecutors. That is not normal."

Prosecutors, in addition to indicting Ghosn, have also indicted Greg Kelly, an American director at Nissan who is accused of helping Ghosn hide the deferred compensation. Kelly, who was released on bail Dec. 25, is represented by a different attorney. He also maintains his innocence.

Nissan spokesman Nicholas Maxfield said the Tokyo Public Prosecutors Office began an investigation into possible wrongdoings during Nissan's internal probe.

"The sole cause of this chain of events is the misconduct led by Ghosn and Kelly," he said. "Nissan's investigation uncovered substantial and convincing evidence of misconduct, resulting in a unanimous board vote to dismiss Ghosn and Kelly as chairman and representative director."

Nissan says it has uncovered further misconduct by Ghosn since November. It maintains that its focus is on improving corporate governance to prevent repeated misconduct.