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Updated July 3, 2003, 4:58 p.m. ET

Lawyers spar over whether novelist gained from wife's untimely demise
Katherine Kayser testified Thursday about pension plan payments made to Michael Peterson after his wife's death.

DURHAM, N.C. — Less than six months after Kathleen Peterson died at the bottom of a blood-soaked stairwell, her husband tapped her 401K, pension and company savings plans for about $347,000, jurors learned Thursday.

The evidence, coming on the third day of Michael Peterson's first-degree murder trial, is part of the prosecution's effort to show that the author and former newspaper columnist gained financially from his wife's death.

Durham District Attorney Jim Hardin Jr. told jurors in his opening statement Tuesday that Michael Peterson also stands to benefit from a $1.4 million life insurance policy, assuming he can avoid going to prison for life and can bypass legal challenges from Kathleen Peterson's first husband and an adult daughter.

Michael Peterson in court Thursday

Katherine Kayser, an employee in the human resources department at the corporation where Kathleen Peterson worked, testified for the prosecution that Michael Peterson was paid $94,455 from his wife's pension plan on Feb. 11, 2002. A week earlier, he received $29,360 from Kathleen Peterson's 401K retirement plan. By May of that year, Michael Peterson had received three payments totalling $223,000, money his wife had saved in the company's deferred compensation plan.

But on cross-examination, defense lawyer Thomas Maher used a calculator, large notepad and Nortel Networks personnel records to argue that Kathleen Peterson was worth more alive than dead.

Had she not died, he argued through questioning, Kathleen Peterson would have continued to earn $145,000 a year, receive stock options and benefit from continued contributions by her comany to her 401K and pension plans. He also noted that Peterson and his children lost the health insurance benefits that came with her job.

Prosecutors also used the Nortel witness, their fifth witness in three days, to establish that Kathleen Peterson had been exercising stock options during the year before she died. The suggestion, which Hardin stressed in his opening statement, was that the Petersons were having financial difficulties and were liquidating assets to pay bills.

Using prevailing stock values, however, Maher showed that Kathleen Peterson could have enjoyed a net profit of $677,000 during 2001 by selling 22,600 shares of vested stock she had held since 1994. In reality, she exercised a much lower amount and had not exercised any options between March 2001 and her death on Dec. 9, 2001.

After court concluded for the holiday weekend, defense lawyer David Rudolf told Courttv.com that Peterson applying for his wife's company benefits in January 2002 wasn't so unusual. That was the month he posted a $850,000 bond to get out of jail after his indictment.

In other testimony Thursday, Durham firefighter Jayson Crank told jurors he observed what appeared to be dried blood on the front door of the Peterson home. He was the fourth prosecution witness to testify about seeing dried blood, which has emerged as a key issue. Prosecutors believe Peterson killed his wife some time before calling 911 and reporting that she had accidentally fallen down a flight of stairs.

As with the three other witnesses, the defense brought out during Crank's cross-examination that the firefighter never mentioned dried blood during his first written police statement, only later.

During Crank's testimony, the defense entered into evidence transparent, plastic sandals that Kathleen Peterson was wearing the night she died. It was not clear how the defense, not police crime scene technicians, came to possess the sandals or what their significance would be to the defense's case.

Caitlin Atwater cried during the testimony of a firefighter.

As the defense projected a photograph on an overhead scene, Caitlin Atwater, Kathleen Peterson's daughter from her first marriage, broke down in tears in the first row of the gallery. The photo depicted Kathleen Peterson lying on her back in a pool of blood at the bottom of the stairs.

The trial is being broadcast by Court TV. Testimony resumes Monday at 11 a.m.

 


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