Wednesday, April 13, 2005

Scrushy - Three Less to Deal With

Yesterday, the court eliminated three of the charges faced by Scrushy, the perjury counts.  But this may be insignificant in that Scrushy still faces 55 counts including hefty penalty charges like securities fraud and money laundering. Is this why the Justice Department is not upset about this ruling?  (See Wall Street Journal)  Or is it because they are glad to just move on with the trial?

In some respects it is better for the government to have this ruling now, prior to significant evidence coming in on the perjury counts.  If there were more evidence on these now dismissed counts, then the defense might have a stronger case, if Scrushy were convicted, in claiming that his convictions were tainted by the improper evidence.  ("spillover effect").  Having the counts eliminated now removes what could be a significant appellate argument  should a conviction occur.

The government's 19 page response here, on the defense motion regarding improper cooperation between the SEC and the DOJ, was telling in that it seemed to ignore the defense request for an evidentiary hearing. Although some may consider this court ruling significant and something that may have impact on other similar cases (see quote from Professor Pam Bucy in the Wall Street Journal), this may also be a very narrow ruling that is fact specific.   This may not be a situation that a judge is saying that the SEC and DOJ can't communicate, but rather a situation of the DOJ first telling the court that there was no cooperation and later the court hearing from a witness that there was such cooperation. (See the defense motion here).  We await the Court's ruling to fully access this issue. But in the interim, the trial moves on and Scrushy still has ample allegations to contend with.  See more here.


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