Some Enron news for you:
A U.S. Supreme Court decision does not undo any of the convictions against former Enron CEO Jeffrey Skilling, but his case should still be sent back to a Houston judge for resentencing, an appeals court said on Wednesday.
Last June the Supreme Court ruled that one of the theories behind Skilling’s 2006 jury conviction for conspiracy — the honest-services fraud theory — should not have been used in instructions given to the jury. The high court sent the issue back to the 5th U.S. Circuit Court of Appeals to determine if the use of the theory invalidated any of the charges.
In a ruling filed Wednesday afternoon the 5th Circuit said it found the error “harmless” and affirmed the convictions. See the document below.
Skilling will still be resentenced by U.S. District Judge Sim Lake, however, based on a prior ruling from the appeals court that the Houston judge applied federal sentencing guidelines improperly.
You can see the ruling here. Tom Kirkendall, who has followed the appeals process for Enron defendants a lot more closely than I have and who has been a consistent critic of their prosecution, was unimpressed.
What is most striking about the Fifth Circuit’s decision is its utter vacuity. For example, the decision contends that there was “overwhelming evidence” that Skilling committed securities fraud by engaging in fraudulent accounting in regard to several Enron units. But the decision fails to cite any of the supposedly “overwhelming evidence” and doesn’t even address the rather important point that the prosecution did not accuse Skilling of falsifying any of Enron’s accounting. In fact, the prosecution didn’t even put on any expert evidence that Enron’s accounting for the allegedly misleading disclosures was wrong, much less false. This tortured logic took this Fifth Circuit panel six months to generate?
Tom says that Skilling is now also able to pursue an appeal of his conviction on grounds of prosecutorial misconduct, so this matter is still far from settled. The news story says that former Enron CFO Andy Fastow is scheduled for release from prison later this year, which will be around the time of the 10th anniversary of Enron’s collapse.