Upheld Verdicts
The U.S. Court of Appeals in New Orleans reviewed his case in 2011 and determined there was “overwhelming evidence” presented at trial to convict Skilling without the flawed legal theory. The appellate court upheld the verdicts against Skilling and ordered the trial judge to recalculate his term, as the appeals court previously had determined that sentencing guidelines were improperly applied.
Skilling has served more than six years for his conviction on 19 counts of conspiracy, fraud, insider trading and lying to auditors. He is expected to receive the standard 15 percent sentence reduction given all federal prisoners for good behavior, as well as a one-year credit for completing an inmate substance-abuse program.
Skilling’s lawyers had been pressing Lake for a new trial on claims prosecutors improperly withheld evidence Skilling contends might have undermined testimony by a key witness against him, former Enron Chief Financial Officer Andrew Fastow.
Trial Testimony
Skilling claims Federal Bureau of Investigation agents didn’t turn over notes of their early interviews with Fastow, in which Fastow’s account of his dealings with Skilling and other Enron executives allegedly differed from his trial testimony. Skilling’s attorneys have argued in hearings and court papers that these notes could have been used to undermine Fastow’s credibility with jurors, who knew Fastow had cut a deal with the government in exchange for leniency.
Fastow pleaded guilty to securities and wire fraud in 2004 and forfeited almost $24 million stolen from Enron through side partnerships he created. He testified extensively against Skilling at trial and was sentenced to six years in prison, four years less than he’d agreed to serve in his plea deal with the government.
Enron used Fastow’s off-books partnerships to hide billions of dollars in losses and debt, distorting the company’s true financial performance and inflating its share price. When the partnerships were revealed, Enron’s stock nosedived, plunging the company into insolvency in a matter of weeks.
More than 5,000 jobs and $1 billion in employee retirement funds were wiped out overnight when the company filed for Chapter 11 bankruptcy protection in December 2001.
The case is U.S. v. Causey, 4:04-cr-00025, U.S. District Court, Southern District of Texas (Houston).