Saturday, November 6, 2004

Enron Barge Trial

A story in the Houston Chronicle (Nov. 6) discusses the sentencing phase of the Enron/Merrill Lynch barge trial.  A key Issue being argued to the jury is the amount of the loss caused by the barge deal, which the government pegs at $43.8 million and a defense expert estimated at $120,000.  The disparity shows once again that accounting and loss estimation are a less-than-exact science.  The loss provisions of the Federal Sentencing Guidelines state that the amount of loss is only an estimate and need not be exact.  The article reports that

The judge also asked the jurors to consider what kind of leadership or managerial role each man had, whether they abused a position of trust at the bank, whether there was more than minimal planning involved, and whether they used sophisticated methods.

Two defendants, former Enron finance executive Dan Boyle and former Merrill Lynch executive William Fuhs, opted out of the Blakely sentencing phase of the case, apparently ceding any right to have a jury decide the factual issues at sentencing.  The post-Blakely world will include arguments on the severity of the sentence triggered by the jury's factual finding, if that is indeed where the Supreme Court takes the Federal Sentencing Guidelines.  According to the story,

Thomas Hagemann, attorney for [former Merrill Lynch banker Daniel] Bayly, told jurors their decisions could alter "whether Mr. Bayly goes to prison for 15 years or not at all." But prosecutor John Hemann told jurors that it is the judge, not the jury, that will decide the punishments and they are to consider the facts before them and not be swayed by attempts to garner sympathy.

(ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2004/11/enron_barge_tri.html

Enron, Sentencing | Permalink