ATHENS - There are some famous names on the witness list for the Jim Donnan trial, and four of them took the stand Monday.
Tommy Tuberville (former Auburn football head coach now at Cincinnati) testified about his investment in a failed company that the federal government said was a Ponzi scheme. So did Billy Gillispie (former Kentucky basketball coach), Mark Gottfried (current N.C. State men’s basketball head coach) and Dennis Franchione (former Alabama and Texas A&M football head coach).
The prosecution is expected to rest its case Tuesday after spending about a week presenting numerous investors in GLC. Donnan, 69, is charged with 41 counts related to fraud. His attorneys say Donnan was duped by ex-partner Gregory Crabtree, who has pleaded guilty to one charge of conspiracy and faces five years in prison.
Gillispie lost about $1.7 million due to his investments in GLC. Franchione has paid Gillispie to help offset that, leaving Gillispie’s losses at around $700,000.
“There was zero risk, because there was no chance for me to lose any principal, was what I was told time and time again,” Gillispie said on the witness stand.
Tuberville testified that Donnan didn’t pressure him into anything. Tuberville and his wife ended up investing $1.9 million, although how much he got back or lost wasn’t made clear during questioning.
“It wasn’t a forceable sell, like, ‘you’ve gotta put money in this,’ ” said Tuberville, who has known Donnan for about 20-25 years. “(Donnan said), ‘Don’t take my word for it, call Dennis Franchione and feel him out because he’s been in it for awhile.’ And that’s what I did.”
Franchione said he remains friends with Donnan despite losing more than $1.174 million. They first met when they were assistants at Kansas State in 1978, and they’ve remained friends ever since.
“I have known Jim a long time, believed in him and trusted Jim,” Franchione said.
Franchione testified that Barry Switzer (the legendary former football head coach) and Tuberville called him to seek information on the deal. Switzer ended up investing, and his son-in-law testified Monday.
Despite the huge financial loss, Franchione said he remains friends with Donnan, and they still talk and “exchange ideas."
Gottfried testified Monday that Donnan sold GLC, the company, as a good investment, comparing it to his time at Oklahoma working with Switzer.
“It was kind of like the oil wells, they were already pumping, they were already making money, it was a great opportunity to join in,” Gottfried said.
At the time Gottfried was an ESPN analyst, in between head coaching jobs at Alabama and N.C. State. (The man who replaced Gottfried on an interim basis at Alabama, Philip Pearson, is now an assistant coach at Georgia.)
Gottfried testified that he has known Donnan since 1988, having met through Gottfried’s uncle, Mike, who was a football coach at Pittsburgh and other schools. Donnan first reached out to Gottfried about GLC via a phone call and sold it as a good chance to make money.
“That it was a good investment opportunity and that there were a number of other coaches involved, that it was pretty much no risk, and it was a great opportunity to make some money,” Gottfried testified.
Gottfried testified that Donnan informed him that Tuberville, Gillispie and Franchione were investors. Gottfried did not talk to those coaches about his investment but respected them and Donnan enough to make the investment. Gottfried also discussed the investment with Athens businessman Kevin Price while attending the funeral for Jim Harrick’s wife. Price was an active investor in GLC.
Gillispie said that in 2009 he was looking for a business opportunity, and was referred to Donnan by a friend. So the two spoke, and Gillispie testified that it sounded like “a safe investment.”
“The most important thing to me was you’re not going to lose any money,” Gillispie said. “The principal is never going to be lost. I asked (Donnan) how long this was going to last. He said, ‘I don’t know exactly how long this is going to last.’ But he always guaranteed me that no principal was going to be lost, so that’s why I (continued) to invest with him.”
Gillispie initially saw a payoff on his first investment of $200,000. But he remembered where he was — an airport in Washington, D.C., after a golf trip to Congressional Country Club — when Donnan called to say GLC was running into some trouble.
“He said, ‘The thing’s in the ditch right now. We’re gonna be able to work it out. You’re going to be able to get back your principal,’” Gillispie testified.
Gillispie did receive a payment of $110,000 later. But when GLC imploded, Gillispie was one of the many investors who had a massive net loss.
Tuberville and Gillispie, who had lunch together at Fuzzy’s restaurant in Athens before their testimony, provided some moments of levity on the stand.
Tuberville, asked by a prosecutor whether he came into some money in late 2008, answered, “I got an exit fee from Auburn, yes sir.” There were a few laughs from the gallery.
A few minutes later, defense attorney Ed Tolley was going over Tuberville’s moves — Auburn to ESPN to Texas Tech to Cincinnati — and Tuberville interjected, “It’s hard to keep up with us.”
When Gillispie, who was fired from Texas Tech in 2012, took the stand and was asked for his vocation, he answered with a smile, “I’m not currently doing anything right now.”