Mike McQueary was called as a witness in a hearing for three former Penn State officials accused in a cover-up of the scandal. He told the judge that the late Hall of Fame coach had told him over the years that "Old Main screwed up" - referring to university administrators - in response to the allegations against Sandusky.
Former Penn State president Graham Spanier, retired university vice president Gary Schultz and ex-athletic director Tim Curley are accused of failing to tell police about a sexual abuse allegation involving Sandusky and then trying to cover it up. They have proclaimed their innocence.
McQueary testified about a specific exchange in the week before Paterno's firing in November 2011.
He recalled the head coach as saying that the school would come down hard on McQueary and try to make him a scapegoat. Paterno advised McQueary not to trust the administration or then-university counsel Cynthia Baldwin, the former assistant coach testified.
A Penn State spokesman said Monday the university would not comment on the legal proceedings. The Associated Press left a message for a Paterno family spokesman.
The hearing, which could last several days, began Monday after being delayed for months because of a legal dispute about the role played in the case by Baldwin, who had accompanied the administrators to their grand jury appearances.
The judge must determine whether there's enough evidence against the ex-officials to send the case to trial. The three are charged with perjury, obstruction, endangering the welfare of children, failure to properly report suspected abuse and conspiracy. Those charges include allegations of hiding evidence from investigators and lying to a grand jury.
McQueary has testified that he saw Sandusky and a boy engaged in a sex act in the locker room shower 2001 and within days reported it to Paterno, Curley and Schultz.
Curley and Schultz have said McQueary never reported that the encounter was sexual in nature, while Spanier has said Curley and Schultz never told him about any sort of sex abuse of a boy. They said they had believed that Sandusky and the boy were engaged in nothing more than horseplay.
Sandusky is serving a 30- to 60-year prison sentence after being convicted last year of sexually abusing 10 boys. He maintains his innocence.
Curley and Schultz were charged in November 2011, when Sandusky was arrested, and accused of perjury and failure to report.
Spanier was forced out as president at that time, and he was charged a year later when more counts were added against Curley and Schultz. He remains a faculty member on administrative leave.
Paterno died in January 2012. His family has vehemently denied accusations that he covered up allegations against Sandusky, the once highly-regarded defensive coordinator.