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USA v. Peterson, Et Al. Trial, Week 2

Tuesday, September 15, 1998.

Houston, Texas.

Day 4 of trial - Testimony continues

Court watchers in the U.S. District Court of Judge Ewing Werlein, Jr. yesterday got a preview of things to come as an insurance company representative testified in the first criminal case to be brought against psychotherapists for implanting false memories in their patients. For the first time since the opening of the trial on September 8, courtwatchers heard about memories of alleged severe childhood abuse involving sexual abuse, cannibalism and torture in satanic cults.

Most of the testimony concerned the bills for insurance coverage of Lynn Carl and her two children at the former Spring Shadows Glen, a Houston mental health facility that has since been closed by Texas authorities but which has reopened under new ownership as Memorial Spring Shadows Glen. Last year, Carl won a $5.8 million dollar malpractice suit against the defendants for employing highly suggestive techniques to implant false memories of satanic abuse. The present criminal trial seeks to demonstrate that the defendants, five former staff members of Spring Shadows Glen, deliberately implanted the memories to justify hundreds of thousands of dollars paid out in claims from generous or unlimited insurance policies held by seven patients.

The criminal trial is expected to last 2-3 months. Watch here for more continued and detailed coverage as events unfold.

Wednesday, September 16, 1998.

Houston, Texas.

Day 5 of trial - FBI Analyst Testifies

Debra Taylor, an FBI financial analyst, testified on the fifth day of the criminal trial against Spring Shadows Glen administrator George Jerry Mueck, psychologist Judith Peterson, psychiatrists Richard Seward and Gloria Keraga, and therapist Sylvia Davis. She testified that insurance companies paid $679,262 for treatment of Lucy Abney and her two daughters, Karen G. and Catherine S.; nearly $1.5 million for Lynn Carl and her two children, B.J. and Kristi; and more than $1 million for Mary Shanley, all former patients at Spring Shadows Glen from 1991 to 1993. The hospital has since been sold and is now called Memorial Spring Shadows Glen.

In her testimony, Taylor said that 80 percent of the insurance money, $2.9 million, went to Spring Shadows Glen rather than to the defendants. Her analysis covered payments to Spring Shadows Glen, Seward, Keraga and Peterson Psychological Associates, an organization headed by Peterson and Davis. Under cross-examination she said that her analysis did not list payments to a few therapists who treated the patients but who were not charged in the case.

Several of the seven former patients involved in this case are expected to testify about the therapy they received at Spring Shadows Glen, a private psychiatric hospital. The testimony is expected to include the fact that patients now believe that their recovered memories of satanic ritual abuse, cannibalism, torture and human sacrifices were suggested and encouraged by therapists.

This summary is based on a Houston Chronicle article by Mark Smith, "Insurance payments to clinic outlined in false memories trial" 9/16/98

A list of civil cases brought against therapists associated with the dissociative disorders unit at Spring Shadows Glen is available.

Important News Update

The following people have been named as unindicted co-conspirators in the case: Bennett Braun, M.D., Roberta Sachs, Ph.D., and Corydon Hammond, Ph.D. All three have been mentioned in FMSF newsletters in the past, and extracts containing relevant information may be viewed via the links below:

Bennett G. Braun, M.D. served as Medical Director of the Dissociative Disorders Program at Rush North Shore Medical Center, Rush-Presbyterian-St. Luke's Medical Center, Skokie, Illinois. Dr. Braun and Rush-Presbyterian settled a lawsuit brought by Patricia Burgus for $10.6 million last year. Most recently, the Illinois License Board has brought action to remove Braun's license. That hearing will be on September 28, 1998.

Roberta Sachs, Ph.D. was the Director of Training at the Dissociative Disorders Unit at Rush-Presbyterian-St.Luke's Medical Center.

Corydon Hammond, Ph.D. is a Professor at the University of Utah School of Medicine.

Thursday, September 17, 1998.

Houston, Texas.

Day 6 of trial - Shanley Testimony

Mary Shanley, a former patient at Spring Shadows Glen Hospital, testified about her treatment there during day six in the federal criminal trial against Judith Peterson and four other hospital workers who are accused of collecting fraudulent insurance payments by convincing patients that they suffered mental disorders brought on by satanic cult abuse. A former teacher in Illinois, Shanley testified that although she went to Spring Shadows Glen for what she thought would be a short stay, she was there for more than two years.

Shanley told the jury that she was sent to Spring Shadows in 1991 by therapists in Illinois to be 'deprogrammed' from the effects of a satanic cult. Her then 9-year-old son was also sent to the hospital and also evaluated by Judith Peterson whom Shanley was told was a deprogramming expert. She did not see her son at any time while she was in the hospital, and today they are estranged.

Shanley said she was told that she would have "to get worse before you would get better." She said that the "deeper you got into therapy, the more difficult it was to determine what was true and not true." She testified that she was medicated with Prozac, an antidepressant, Xanax, an antianxiety drug, and Inderal. She said that if her blood pressure became too low, she was given high amounts of salt and she bloated up. Fluid retention is a common reaction to too much salt, but Shanley testified that a therapist told her that it was a "body memory" of a pregnancy when she was in the cult.

Several former patients are expected to testify about their treatment at Spring Shadows Glen dissociative unit between 1991 and 1993. They are expected to describe recovering memories of cannibalism, torture and human sacrifice. The unit has since closed and the hospital is now known as Memorial Spring Shadows Glen.

Defense attorneys claim that neither the treatment nor the costs of that treatment at Spring Shadows Glen were out of line because thousands of patients were similarly diagnosed and treated during the late 1980s and early 1990s.

The trial will resume on Tuesday, September 22.

This summary is based on a Houston Chronicle article by Mark Smith, "Woman kept at hospital two years for ‘deprogramming,’ she testifies." 9/17/98. Another account follows:

The Case of Mary Shanley

The trial, which until now had primarily concerned accounting matters and insurance policies, began to take on a more human face when testimony concerning the case of Mary Shanley began. Shanley's friend, Meredith Schreiner took the stand first to testify to the deterioration she witnessed in Shanley and in Shanley's marriage over the course of her treatment. Schreiner, who approached the stand with a cane, was a compelling witness and the courtroom was silent throughout her testimony. Mary Shanley herself took the stand after Schreiner.

Mary Shanley, 47, is a small, attractive woman. As she took the stand, defendant Judith Peterson pulled her chair into the aisle up close to the witness stand. Throughout Shanley's testimony, Peterson glared at Shanley with a fixed, hard, cold stare. "That's some stare!" remarked one court watcher. Until now, Peterson has sat at the defense desk taking copious notes. Her back has generally been to the jurors.

Mary Shanley is one of six children raised in Colorado by two alcoholic parents. She received her B.A. degree in elementary education and, in 1979, married Joe Shanley. In 1981, she gave birth to Ryan, her son and only child. Shanley took a maternity leave to care for her son immediately following the birth. Also following the birth, Shanley began to experience what she referred to as "blackouts." She was subsequently diagnosed with seizure disorder. She had a toxic reaction to the first drugs prescribed.

Shanley’s husband, Joe was an alcoholic. In 1984, the Shanleys joined a Marriage Encounter Group comprised of other couples dealing with alcoholism. Here they met William and Meredith Schreiner. According to Schreiner's testimony, both Shanleys were wonderful parents. Shanley was teaching elementary school and Joe was working for Motorola at the time. Despite their difficulties, Schreiner testified that the Shanleys had a close relationship. They lived in a Chicago suburb. The Shanleys and the Schreiners generally met at least once a week.

In 1987, Shanley had a hysterectomy. Shortly after the hysterectomy, Shanley was attacked in a hallway by one of the parents at her school, her face scratched. Joe Shanley was not supportive to his wife after the attack. And he was unhappy that the couple had lost the capacity to have more children. Shanley began to fall into a depression that deepened noticeably and rapidly, according to Schreiner. Some of the depression seemed to be related to the hysterectomy, and to the fact that Mary had been contacted by the lawyer for a daughter she had given up for adoption. The pregnancy was the result of a violent rape when Shanley was nineteen.

In 1989, Shanley re-established a prior relationship with a therapist associated with Alexian Brothers Hospital outside Chicago. She sought treatment for depression, anxiety, and panic attacks from the therapist, who was in training. As part of her treatment, Shanley was put in group therapy. In the group. there were frequent reports of physical and sexual abuse. Shanley began to have nightmares about abuse which her therapist insisted were memories of real abuse though Shanley said she could remember no such events from her childhood. In addition, Shanley began to have episodes which her therapist said were symptoms of "dissociation," probably the result of having been severely abused in a satanic cult. Despite the fact that the therapist ought to have been aware of Mary’s seizure disorder and that several physicians had diagnosed the seizure disorder as "reactivated" in 1989, no additional medical tests were administered. Furthermore, Shanley's real life problems received little attention in the therapy.

At one time, the therapist shared these beliefs that Shanley had been abused in a cult with a psychiatrist at Alexian. The psychiatrist disagreed and refused to participate in treatment that proceeded from this assumption. The psychiatrist, however, made no further attempt to interfere with Shanley's treatment.

In 1990, the therapist made arrangements for Shanley to enter Forest Hospital, though Shanley's first therapist was also involved in her continuing treatment. Again without adequate medical testing, and despite the fact that Shanley's seizure disorder was entered on her admission chart, Shanley's treaters diagnosed her as "dissociative." Over time, as Schreiner testified, Mary's condition worsened. Shanley was eventually diagnosed as suffering from MPD and told she had been a member of "satanic cult." Shanley’s husband, Joe, also became utterly convinced by the treaters that his wife was a member of a satanic cult.

Shanley’s treaters referred her to the Dissociative Disorders Unit of Rush-Presbyterian St. Luke's Hospital on the grounds that the staff there were recognized experts in the treatment of satanic cult victims. Shanley’s therapist in particular referred Shanley to Roberta Sachs, one those named as an unindicted co-conspirator in the Houston trials. In the first five minutes of the intake interview, Sachs diagnosed Shanley as suffering MPD as a result of cult abuse. She justified this diagnosis on the basis of "finger signals." The Dissociative Disorders Unit at Rush was filled to capacity, but Shanley was hospitalized at Old Orchard. Though under separate management, Old Orchard was in the same building as Rush-Presbyterian and Shanley was treated by unindicted co-conspirators Dr. Bennett Braun and Roberta Sachs until she could be admitted to Rush-Presbyterian. The facilities were so close that when Shanley was admitted to Rush-Presbyterian it was simply a matter of taking an elevator to another floor.

According to Schreiner’s testimony, Shanley called her friend from Rush in April of 1990 to ask for help in getting out of the facility. Schreiner contacted Joe Shanley who informed her that, under her doctor’s orders, no one was to contact Mary. Schreiner did not follow up and she did not hear from Shanley again until Thanksgiving of 1993. Schreiner testified that she wondered if Shanley had died.

Shanley remained at Rush-Presbyterian until February of 1991. She was given high dosages of medications prescribed by Braun, including high dosages of Inderal, a heart medication. Sachs’s therapy with Shanley consisted of thrusting upon her the diagnosis of MPD and encouraging Shanley to get in touch with her alters. Sachs hypnotized Shanley and urged her to get in touch with her alters by reacting to photographs from magazines. In addition, both Braun and Sachs had numerous sessions with Shanley in which Shanley was encouraged to name other contacts from the cult. These included friends, other teachers, people from her church and her social life, Shanley testified. Braun had little interest in her or her case except when she was forthcoming with these names or he wanted to prescribe additional medication, according to Shanley. Little or no attention was paid to Shanley’s seizure disorder or to any of her real life issues such as the impact of her hysterectomy or contact from her daughter’s attorney, the attack in a school hallway, her husband's drinking or the impact of these upon Shanley’s marriage.

In February of 1991, Sachs asked Shanley to meet with Dr. Corydon Hammond who was in Chicago to attend a conference. Hammond asked Shanley a number of questions that absolutely mystified her, including a series of questions about the Greek alphabet. He asked her, for instance, if she knew any letters of the Greek alphabet. When Shanley named "Gamma" Hammond diagnosed her as having a cult alter that was a danger to herself, her therapists, and other patients. Shanley was flown to Spring Shadows Glen to be "deprogammed" without knowing her destination and without an opportunity to say good-bye to her husband.

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