Monday, February 21, 2005
While the criminal prosecution of Bernie Ebbers will be concluding soon, the civil securities fraud class action against WorldCom, its directors, and various banks involved in the company's finances will have to wait a little bit longer before it can begin. As discussed on Jurist, U.S. District Judge Denise Cote has postponed the trial until March 17 to give the attorneys a chance to interview the witnesses from the criminal case -- most likely, former CFO Scott Sullivan, who was the architect of the fraud and key witness in the criminal prosecution of former CEO Ebbers. Sullivan has been kept under wraps by the U.S. Attorney's Office prior to the trial, to ensure that Ebbers did not gain any "free" discovery of Sullivan's testimony through the civil case. Now that Sullivan (and others) have testified, that stricture is gone and the civil attorneys can pursue their case, which involves broader issues than just Ebbers' involvement in the fraud.
Jurist also notes that Judge Cote has said the trial will be concluded by July, less than the nine months projected by counsel. Unlike most criminal cases, the judge in a civil case can speed things along more easily. It will be interesting to see if the case even goes to trial, given the propensity for such actions to settle (the judge refused an earlier settlement negotiated by the parties as being unfair to the banks named as defendants). (ph)