updated 3/15/2004 4:35:41 PM ET 2004-03-15T21:35:41

The judge presiding in the fraud trial of the Rigas family on Monday said prosecutors had made "an egregious error" and a motion for a mistrial would be appropriate.

In questioning former Adelphia Communications Corp. director Dennis Coyle last week, the government had sought to show that Rigas-owned businesses incurred debt guaranteed by Adelphia, even though the businesses did not fulfill some financial requirements for such guarantees.

Coyle testified that management led him to believe any entity incurring debt under the arrangements had to meet standards on leverage and operating cash flow. Individually, the Rigas-owned entities did not have sufficient operating cash flow to meet those standards.

However, on Thursday Coyle conceded that publicly filed credit agreements covering the borrowing arrangements said that the tests applied collectively to all the businesses involved, including Adelphia, which had much greater operating cash flow.

On Monday, Coyle testified that he first realized Thursday that his understanding of how the tests worked was wrong.

"The fact that the government made an egregious error is very unfortunate and would appropriately be dealt with on a motion for a mistrial," U.S. District Judge Leonard Sand told lawyers before jurors arrived in court Monday. He added that he was not suggesting what the outcome of such a motion would be.

Former Adelphia chairman John Rigas, two of his sons, and former Adelphia executive Michael Mulcahey face charges of fraud and conspiracy in an alleged effort to loot the company and mislead creditors, investors and the public. All four have pleaded not guilty.

John Rigas was not in court Monday. He was at the Mayo Clinic in Rochester, Minn., for bladder-cancer treatment following an appointment there last week. He is expected to be out Tuesday as well.

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